The sun., 1903-09-16
RETALIATE, SAYS BALF0UR.
NE TELISWHl ENGLAND SHOl'L ID
MAKE TARIFF CHANGE.
lie Says That In Order 10 Maintain Their
Trade supremacy They should DO
Ia Foreign Nations what They DO 10
Each Other-Mistaken Policy In Past.


Each Other-Mistaken Policy In Past.
Special Gable Dsspdtch to The SUN.
LONDON Sept, l8.-Prime Minister Balfour
has issued a pamphlet entitled Economic
Notes on lnsular Free Trade II is
practically republication OF a series Of
notes which he circulated privately among
his colleagues in the Cabinet early in August
and amounts to statement Of his fiscal
policy.
he declares that he approaches the sub
Ject from the free trade viewpoint, although
the free trade is not, perhaps always that
which is regarded as orthodox in the'House
OF Commons or on the platform: in other
words. he is not exactly Cobdenite
After a general discussion OF economic
forces the Premier points out what he
regards as two errors on the part of those
who worked in the cause of fiscal reform
half a century ago.
They failed to foresee," he says, shat
the world would reject free trade, and
failed to take full account of the CONNER
| cial probabilities of the Britt ish Empire.
IF they had been right on the first point
II free trade had indeed become the uni
versal creed, no controversy about our
commercial relations with any fiscaly indie
pendent community could possibly have
| arisen.
IF, on the other hand they had succeeded
| in giving us imperial free trade, the pro-
| tective tariff tendencies Of foreign nations
! would in the long run have been but of
| secondary importance These double
errors have established insular free trade,
with its inevitable limitations, and left us
| bearing all the burden, but enjoying only
| half the advantages which should attach
| to the empire"
| This line of thought leads Mr. Balfour
to the salient question as to whether a
fiscal system suited to free-trade nation
in world of free traders remains suited
| in every detail to free-trade nation in
world Of protectionsist.
| Discussing the various phases Of the prob
lem now before the country and citing one
or two imaginery cases of economic de-
pendence, he urges that in actual fact Great
Britain is hampered by foreign tariffs, yet
| is able in spite Of them, to carry on an ex-
port trade which increases rather than di
! mnishes and IN import trade of ofunexampled
| magnitude.
The point to be considered, says the
| Prime Minister, is not the momentary
position of trade, but its tendency. British
| trade absolutely may have increased, but
! it's rate of increase on the whole has ser
ously diminished.
In some important departments no in
crease is perceptibe' in others there are
symptoms Of decay. If the tide Of inter-
| 10 in
portion to the growth Of wealth of the
| people Is it because of the ope ration OF
| some inevitable law?
Mr.. Balfour thinks not. but because it
has been made impossible by the operation
| Of hostile tariffs. National industries,
he says. have not been allowed to become
mutually supplementary; they have been
compelled to become mutually exclusive
| Fiscal contrivances have forced them out
Of cooperative into competitive channels
After discussing the question Of the in
Jury which tariffs working in alliance with
| modern trade combinations may infict
and tentally condemning the system
of Government bounties to a nations
industries such as that Of Germany to
the shipping trade the Premier goes into
delails as TO injuries which foreign pro-
| lection is calculated TO infiict on Great
| Britain ns a free-trade country and then
says'
1T see ln. TO me to be clear that we are
bound to seek some mitigation, and that
in one direction only can We hope TO find it.
The source of all the difficulty being the
protective tariffs imposed by tiscaly indie
| pendent communities, it is plain that we
can secure no concession in the direction of
freer exchange except by negotiation and
thar our negotiations can but appeal to
self int crest or in the case of our colonies
to self interest and sentiment combined.
"Now, on the free trade theory, self
interest should have prevented these
tariffs originally from being imposed,
but il did not and II the argument failed
before powerful vested interests were
created il is hardly likely TO I've effective
now.
-Tho only alternative is to do to foreign
| nat ions what they always do to each OF her,
and instead Of appealing to economic
theories, in which they wholly disbelieve,
to use fiscal Inducements, which they
thoroughly understand
I'VE alone, among all the nations, are
unable to employ this means of persuasion,
not because in our hands il need be nef
foctual, but because in obedience TO a princi-
pie we have deliberately thrown it away. The
principle to which we pay this strangely
incongruous rbute is. of course. the prin-
ciple of free trade. But what a curious
view of free trade, II implies that the
object which these fiscal Inducements are
intended to attain is increased free trade
not hing else,
And yet simply because the fiscal in
duccment may, if II fails Of its effect but not
otherwise, involve duties not required for
revenue purposes, or in certain cases even
carry with il some element Of protection to
home indust ries. we are to turn away from
il a. from an accurSed thing. This seems
TO me an nextraordinary piece of foolishness
Mr.. Balfour regards himself as in har-
mony with the true spirit of free trade
when he pleads for freedom to negotiate
that the freedom Of exchange may be- in
creased and that il should not be- difficult
to devis. a method of turning il TO the
most useful account
! "If were proved to be wrong, my opinion
on the fundamental question, says the
Premier, would remain unchanged. Where
we fail others may succeed, IL cannot be-
right for country with free trade ideals
| TO enter into competition with protect iOnis