Ottawa and After
THE results of Ottawa have been hailed in some quarters as a triumph, in others as a disaster. The plain fact is that it is far too soon to decide which they are. The Conference has quite definitely achieved something. It did not break down, though the discussions. between this country and Canada brought it very near . to that point more than once ; the responsibility for that did not lie with our own delegates. Some tariffs are to be increased, others are to be reduced, but details of many of the projected changes are withheld and the agreements are complicated by quota arrangements not involving tariffs, but interfering none the less with the natural flow of trade. That the Dominions, particularly Canada and Australia, will gain substantially by the preferential access to the British market guaranteed them for at least five years is pretty certain. Whether any commensurate advantage will accrue to this country is much more doubtful.
The truth is that when the Ottawa Conference opened the whole affair was a leap in the dark and now the leap has been taken the darkness remains. It remains partly because some of the most important facts about the agreements reached are still unpublished, and partly because there can be no certainty that arrangements which result not in an increase of trade but in an artificial diversion of trade will not do some or all the contracting parties more harm than good. Too nice a computation of profit and loss on the part of each several member of the Commonwealth would be out of place, for the negotia- tors at Ottawa were, after all, members of a family, and though Mr. Bennett proved himself as hard a bargainer in relation to Great Britain as he ever could have in relation to the United States or France, it was still possible for Mr. Bruce, the former Prime Minister of Australia, to say with truth at the end of it all that more important than the agreements actually concluded was the spirit underlying them. For the aspiration for closer Imperial unity is to be welcomed, even though the expression given to it at Ottawa be based, as we are convinced it has been, on a fallacious assumption. The Commonwealth is not held together by economic ties and never will be. The sentiments of this country towards France, Germany. or Italy bear no kind of relation to the amount of trade we do with each of them respectively. Nor is there any ground for supposing that if as a result of the Ottawa agreements we buy rather more from Canada and less from foreign countries, and similarly sell rather more to her and rather less to foreign countries (which, as a whole, will tend to buy less from us because we buy less from them) the spirit animating individual Canadians and individual Englishmen towards one another will be affected in the least degree. The solidarity of the Commonwealth rests on quite other bases than ephemeral and experi- mental trade pacts. Not a great deal could have been done to strengthen it at Ottawa. A great deal might have been done to imperil it, by an excess of national self- seeking. That danger has been avoided, and the negative success therein involved should not go unrecognized.
The broad question to be asked is whether the Ottawa agreements as a whole make for freer or more fettered trade, and in particular whether they will send this country into the coming World Economic Conference, and into negotiations with individual States, tied by commitments that will preclude it from entering into free trade or low tariff arrangements that might be practicable and desirable. There is no question that we have left Ottawa so tied. We have pledged ourselves to the different Dominions not to reduce our 10 per cent. duty on a wide range of imports without their consent, thus making entry into such a customs union as Holland and Belgium are evolving impossible. We have undertaken to impose new duties on a wide range of foodstuffs, including wheat, butter, cheese, dried milk, fruit and eggs. We have committed ourselves categorically to the principle of raising the price of frozen meat, and undertaken to limit supplies from foreign countries for the benefit of Australia and New Zealand. In return we are to enjoy various preferences, still undisclosed, in Canadian markets, and others, already specified, in other Dominions. Few of these arrangements are cIear-cut, and some are definitely perplexing. The arrangement, for example, Whereby the Governments of this country and the several. Dominions will discuss means for giving British producers the opportunity of reasonable competition in Australian and Dominion markets on the basis of relative costs of production, but subject to special consideration for industries not fully established, challenges acute con- troversy in every line, and the right accorded to British manufacturers to be heard before the Dominion tribunal which finally fixes the schedules may mean a good deal or next to nothing. What is more important, it is clear that the Canadian concessions to Great Britain may as easily take the form of an increase of duty on foreign imports (as Mr. Bennett proposed in London in 1930) as of a reduction in the duty on British imports. Till Canada's intentions in that respect are known it will be impossible to determine whether the result of the Con- ference has been on balance an increase or a reduction of tariffs.
All that can be said yet with any confidence of the Ottawa agreements is that they will divert a certain amount of trade—no figures worth putting on paper can be cited—from foreign countries to British and Dominion traders. On a short view that may seem all advantage. On a long view the prospect may be very different. A self-contained Commonwealth is the ideal of the short- sighted. If the world, including the Commonwealth, is to prosper, trade must take an ever wider range, impeded less and less by such restrictions as protection and preferences and prohibitions and quotas. The British Delegation at Ottawa, and in particular Mr. Baldwin as its leader, deserve the appreciative gratitude of their fellow-citizens for the sustained efforts they exerted from first to last to keep the ideal of lowered tariffs continually in the foreground. They only partially suc- ceeded. The gospel of tariff reduction makes little appeal to the present administration in Canada, and in a confer- ence there must be both give and take. As result of the Ottawa Conference we are not free in our tariff negotiations with foreign countries, and shall not be for at least five years. But the restrictions imposed at Ottawa are limited. There is nothing, for example (except the most-favoured-nation clause, which has nothing to do with Ottawa at all) to prevent us from offering a reciprocal all-round 10 per cent. tariff agreement to any country that chooses to accept. That, or something like it, is the goal at which this country ought now immediately to aim. The inunin- ence of Ottawa kept everything in flux. Now that Ottawa is over, yielding results that inspire neither great enthusiasm nor great apprehension, the larger field lies open. Our statesmen (and once more we look with special hope to Mr. Baldwin), will prove their mettle by the degree of resolve they manifest to grasp the opportunity before them. The world, not the Common- wealth, is now their field of action.
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