CORN-DUTIES AND THE PRICE OF WHEAT.
[TO THE EDITOR OP THE "SPECTATOR."] SrE,—Efforts have been made in your columns (June 20th, July 11th, August 15th) to show that the price of wheat in France differs from that in England by the amount of the French import-duty. This is com- paring the prices in different localities at the same time, whereas we want to find out the effect of a duty on prices in one and the same locality,—i.e., prices should be compared in the same locality at different times. It is wrong, therefore, to base arguments on the French compari- son. It can, however, be proved that the whole of an import- duty is not paid by the consumer. If possible, assume that the whole of an import-duty of 10s. is paid by the consumer of wheat. Let the price before the imposition of the duty be 25s., then on our assumption the price after the imposition of the duty will be 35s. Owing to the increased price the con- sumption will be less. For the same reason the home producer will increase the amount grown in the country. The foreigner will still receive his old price. and will therefore send into the country the same amount as before. We thus have (1) a diminished consumption; (2) an increased home production; (3) the same imports as before, which is absurd. Therefore the whole duty is not paid by the consumer. In the same way, it can be shown that the foreign producer does not pay the whole duty. Therefore the amount of the latter is provided partly by the consumer and partly by the foreigner. May I suggest that two most important arguments against Protection have not been brought into sufficient prominence First, the politicians cannot be trusted to impose duties fairly; secondly, changing duties mean uncer- tainty, which is the worst possible enemy to any industry. I venture to think that you could do Free-trade greater service by urging these arguments than by suggesting that if the British farmer had been wise enough to grow early potatoes, &c. (or even to make jam), there would have been no agricul-
tural depression.—I am, Sir, &c., J. C. L
Previous page
