New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1904-12-27
CHANGE OF BASE.
Possibility of a Surprise Budget Soith
Tariff for ReUenae.
London, December II.

Gsczi question has become a matter OF revenue
Whether Free Trade remains the source OF
British prosperity IS a WORKOUT policy IN
suited TO modern conditions. It does not yield
sufscient rerenues 10 meet the requirements
of Increased national expenditures. In this
way the United Kingdom Is confronted. In Pres
ident Cieveiand's phrasing, with "a situation,
not q theory" WheE the inQuigitive English
man at any time during the last forty years
has asked the experienced American whether
the United States whils prosperous under pro-
lection. might not have been better off under
Free Trade. the answer has been a decisive
one The revenue conditions since the Civil
War have made Free Trade on English lines
impossible In America Income taxation. death
and estate duties and at least one-halt Of the
sources Of revenue available for the British
Treasury are excluded under the Constitution
and the State system from the Treasury re-
ceipts at Washington. The American tariff
may be lowered or raised but the conditions Of
English Free Trade finance cannot be repro
duced at Washington without the creation OF
an enormous deficit In nquidating current ex-
psnses. The practical question now asked by
thoughtful men In England is this: "Can this
country go on without having fresh sources of
financial supply" There has been q vast in
crease Of national expenditures since Cobden's
time and there does not appear to be any pros
pect OF reducing them Forty years ago direct
taxation was q subordinate source Of revenue,
and the duties and taxes tobacco. wines.
EpiritH, beer, tea and few other articles were
sufficiently remunerative to enable the Chan
cellor Of the Exchequer to balance his annual
budget. The relations between direct and in
direct taxation have been transformed; the in
come tax. instead Of being a resource available
IN war time, IS at the rate Of a shilling to the
pound In time of peace, and the burdens Of the
nFT na and 6efa
of the empire fall heavily. with almost crushing
effect, upon people with moderate incomes. The
situation requires the creation Of new sources
Of revenue. Direct taxation IS exhausting bust
ness interests and all except the rich taxpay-
ers- The theory of Free Trade may be good,
bad Or Indifferent, but the times have changed
since Cobdens day, and more money is needed
fer the Treasury-and from sources OF
supply.
What the tariff retormers saying IS
that the government ought to convert the fiscal
question into a revenue issue MI Austen
Chamberlain has received during the last few
weeks. in accordance with the practice of the
Treasury officials. estimates of the receipts and
expenditures approximately they viii stand
wher his Budget speech is delivered. The Prime
Minister has probably considered these forecasts.
and possibly the Cabinet has discussed them.
The leading tariff refornaers profess to have
some hope that the Chancellor of the Exchequer
VIII deal with the situation in practical spirit
They say that the military and naval expendi-
lures cannot be cut down without exposing the
nation and the empire to serious risks; and that
even # a million or more be saved by re-
trenchmenf the gain viii be wiped out by in
creased outlay for education involved by recent
legislation. They are assuming with a good
deal of confidence that he will decline to take
the responsibility for adding another penny or
possibly twopence. to the income tax and in
crsasing the duties tea, wines, or other ar
ticles ordinarily within the scope OF indirect
taxation They give him credit for the courage
re7qired for proposing material enlargement
Of the schedules Of import duties, and defending
the recommendation on the ground that national
eSpenditu es cannot be met by ordinary meth
cas- OF Free Trade finance. but that more reve-
nue must be found without reference to eco
nprrlic theories. If the Prime Minister supports
him. there viii be a new issue before the coun-
Try. It will be a tariff for increased revenue
pshen direct taxation has been carried In time
OF peace as far as Is safe or equitable and when
retrenchment is inpracticable without sacri-
hcing the security Of the empire and the inter
eSts Of national education.
The advocates Of this policy do NOT deny thar
budget Of this kind would involve Reputation
os the pledges repeatedly given that the present
Parliament win not be called upon to take I'D
The tariff question, and that the fiscal policy
cannot be changed without an appeal to the
country They VIII be satisfied If the necessity
Tor new sources Of revenue be frankly explained
ard new schedule of import duties be pro-
posed: and they win expect a general election in
the spring and autumn on the issues Of a tariff
for revenue and colonial conference They adj
nit that the government viii probably be de-
tested on these issues but contend that the
I will
stable. They are confident that Liberal gov
erpment committed to the PRINCIPLES Of Free
ITaoe finance cannot last long, since II will find
reHenchment OF national expenditures imposs-
bic and the burdens Of increased direct taxa
ton intolerable. With Mr. BaIfour and Mr.
Chamberlain leading a compact well organized
Opposition united on the question of tariff re-
FORM they forecast a short life for the Free
Trade Ministry, let the Prime Minister be who
ne may ana IN a second election they are con-
naent that there viii be decisive victory for
an enlarged revenue tariff and q free and omen
conference, from which preferential trade with
the colonies will be evolved. This without
doubt is the programme of some Of the most
lnnuenral tariff reformers. They start with the
assumption that the country must be convinced
tsat tariff is necessary for revenue purposes
and that the working classes can be reconcred
70 It when they understand that national edu-
cation and the safety of the empire make II
necessary: and when II is provided there ,,ilI
resources for preferential trade with the
colonies, reciprocity conventions with America
and other countries and retaliation against Ger
many, II so strong weapon be needed.
For the sideiight which It throws on the
future trend Of tariff reform policy. the leading
article IN The Standard" is more imnortant
than M. chamberlains Limehouse speech That
9pprnai mas been silent on the fiscal question