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FREE TRADE v. PROTECTION.

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FREE TRADE v. PROTECTION. The American papers have this week been publishing some interesting contributions which the Xew York Associated Press has received from a special correspondent, who has been pursuing an independent investigation as to the effects of the McKinley Tariff upon the export trade of European countries. The returns quoted are most instructive, and the effect of the Tariff will soon prove so oppressive to the poor classes in America that it is certain a change in the law will be made After the next Presidential election. It has been ascertained that the totals of English exports to the United States for the last three months of 1891, for which figures are obtainable, show an actual increase over the figures of the same months of the previous year. The Protection- ist Consul-General of the United States at London, the Hon. J. C. Xew, contends that the exports of the materials for manufactur- ing the cheaper grades of goods which are used by the working men have not decreased, but have increased, while the exports of such goods as silks, fine worsted, dress goods, fine woollen and goats' hair, have fallen off, which goes to show that the effect of the Tariff Act has been a benefit rather than a hardship to labourers in the United States." From an analysis of the returns it will appear that this statement is in- correct. While the trade in the lower qualities of woollen gooch," says the report, ,-will perhaps cease, high-class woollen goods will always be exported, as rich Americans will insist on having them." Again, speak- ing of the She Sell manufactures, the correspondent says, Recently there has been a perceptible improvement in their condition, as far as the more valuable kinds of goods are concerned. The lower priced articles are affected, however, very greatly. High-cl ass goods always find a ready market in the States, or elsewhere, and it is believed that the tariff in force in the States at the present time has had a more disastrous effect upon German wares than upon the Shef- field cutlery. Upon the lower priced goods, Sheffield as well as German, the tariff has operated prejudicially." At Dundee the general opinion expressed was that the effect of the McKinley tariff in that city and the sur- rounding district had been in the linen trade to cause manufacturers to use much smaller sized yarns, and to send to America much higher oriced goods. The new tariff falls with pro- hibitive force upon the more useful ordinary domestic linens." These extracts seem to us to prove conclusively that it will be the work- ing men of America that the tariff will affect, while it will but\lightl}" touch the wealthy. The object of the McKinley Tariff Act was supposed to be to prCitJct and nurse the home industries of the States. It was found im- possible by the Americans to compete with the cheap labour market of Europe. For instance, a penknife made in Sheffield and sold in England for sixpence, could be exported to the States and sold there for seven pence. A penknife of similar design anI quality could not be manu- factured in America for less than ninepence. Ko American, however patriotic, would be willing to pay ninepence for an Amercan pen- knife, when he could buy an equally good one of English make for seven- pence. What the McKinley Tariff did was to put a tariii 011 every imported article. Thus a duty of threepence would be placed on every Sheffield penknife, and the English manufacturer, who could before sell it for sevenpence, could not now sell it for less than tcnpenoe. As the American manufacturer does not pay the tariff, he can still sell it for ninenence, and thus undersell the English manufacturer. The benefits of the system seem so obvious that at first one is apt to wonder how we in this country ever became Free Traders. Mr. Xcw. however, admits that there is a difference between this country and the States in this matter. This (/.< England) is a free (trade) country, he says," "because the the English arc manufacturers, and not pro- ducers, ° and they necessarily have to get their supplies from other countries. Manufacturers here must sell everything they make, and the adverse interest of our country is only because of a desire to protect home mannfactureo and develope home mar- kets, and because a home market means for America mouths to feed g,nd bodies to clothe." This is the American protectionists' argument in a nutshell. -Security is better than opu- lence," said Adam Smith, and it is well, says the American, to make sacrifices in order to protect home manufactures and develope home markets." This sounds very well, but there are two things that must be taken into con- sideration. First, it may be impossible, even with a protective tariff, to develope home markets." A leading tinplate manufacturer told the correspondent that it would never pay the Americans to manufacture their own tinplates. Another told him that it had been ascertained by a deputation, who went out there to inquire, that they cannot possibly establish profitable tinplate works, unless they put on such prices for their manufactures as would be burdensome to their customers." The cor- respondent is also told in Dundee that to erect works in America (to manufacture jute goods), in the opinion of the Dundee manufacturers, would be a risky enterprise." It is not at all certain, therefore, that the Tariff will help to ■' develope home markets." In the second place, it should be remembered that protection costs something. In the case of the imaginary pen- knife, it will cost twopence, that is, the differ- ence between the English and the American selling price. The question now comes, Who pays this difference ? It is not the English manufacturer, for if he pays threepence tariff he will charge threepence more for the pen- knife. It is not, therefore, the manufacturer but the consumer that has eventually to pay the difference. Nor will the tariff affect English trade, except temporarily. We find from the returns which we have been quoting that only certain localities and certain industries will be -affected. For instance, we find that though the Welsh tinplate trade and the Glasgow manufac- tures will be very much impaired, the trade of the country generally shows an increase. Nor need our tinplate manufacturers be alarmed. They had, as a large Liverpool exporter said, "sufficient fore- sight to get twelve months' stock landed before July 1st," and, therefore, they can afford to wait this year and do little or nothing else," aud by that time he feels confident that the Bill will be revised, even if not rescinded. Even if the Bill be not rescinded, the tinplate exporters will find, as the Leeds manufacturers have, that there are other markets which arc open to -English goods. In Leeds," so the report says, 41 at the beginning of the year, trade was greatly depressed by the tariff, but the Leeds manu- facturers say they have built up a trade with their own Colonies and with Italy, which com- pensates them for the loss in the United States." We feel confident that this will be the experi- ence of every enterprising manufacturer. The American consumer, then, will have finally to pay the tariff, and this explains why it is that the Protectionist Consul-General seeks to prove that the" Tariff Act has been a benefit rather than a hardship to labourers in tte United States." We have already shewn that the Act will affect the working man more acutely than any. England will continue to supply America with high-priced luxuries, but the cheap German wares and domestic goods will now be supplied by American producers. If such goods could be supplied as cheaply by the American as the English manufacturer, the consumer would have no cause to grumble. But, as a matter of fact and experience, this is not the case, and the consumer will have to suffer from the difference of price. Granted that the protection of native industries means for America mouths to feed and bodies to clothe," are the Americans willing to pay the price ? The recent elections show that they are not. The elections were fought on the Tariff Act, and the protectionists were beaten all along the line. Even the farmers, who had hitherto been the main supporters of protection, discarded it now that it affected their own pockets. The Americans are unwilling that nine-tenths of the population should be taxed for the benefit of the remaining one-tenth. The protectionists may talk of public spirit and of the glory of sacrificing the individual for the common good, but the average citizen will see that his self-sacrifice means the enrich- ment of his manufacturing neighbour. The Act will not, therefore, be long endured, and it is almost certain that after the next pre- sidential election it will, at all events, be con- siderably modified. Even in a self-sustaining country like the United States, protection must necessarily be an evil. The present prosper.ty of the States is in spite of, not on account of, protective tariffs, and only affords another proof of the vast resources of that great country. Were its trade freed from the crutches, which impede the progress of every healthy state, the prosperity of the States would increase by leaps and bounds, with a vapidity unoarallelled in modern times. L v L

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