Evening star., 1934-10-14
BY FRANK II. SIMONDS.

PRESIDENT ROOSEVELT ana the
speech of Neville Chamberlain,
Il chancellor Of the exchequer,
have together served to call
attention once more to the ap-
parent contrast between the progress
Of recovery in England and America.
For a considerable time critics of the
domestic administration have been
pointing to the foreign example and
arguing that abroad the Old Deal has
been more successful than the New at
home.
All such comment ignores the mai jor
factor in British recovery, which is
necessarily absent in the American
scene. In the crisis of 1881 the
British abandoned not only the gold
standard but also their policy of free
trade. For century the British mar
ket had been open to foreign goods
and raw materials alike and in many
fields domestic production had been
destroyed by foreign competition.
When, however, Britain reverted to a
tariff, then there was opened to do
mestic production a new field of ac-
tivity. For the time being there was
created an economic frontier. There
was a great new demand to be sup
piled, and to satisfy that demand it
was necessary to build factories and
employ additional labor. There was
then boom which could only follow
the opening up of fresh market.
That boom did not extend to the
branches of British production de-
Dandaof tho x1rOrII
and iron, textiles and shipbuilding re-
manned in approximately the same
state Of prostration as before, or at
best showed a rate of improvement
not different from that of similar in
dustries in other countries. Un-
employment in these branches of
national industry remained constant
and considerable. But it was offset
by the expansion in the new fields.
U. S. Conditions Different.
Patiently, no such resource was open
to the United States or to any other
large country, for all had followed
protectionist policies. In these coun-
tries domestic production already mo-
nopolized the home market in all the
fields in which foreign goods or raw
materials were competitive with do
mestic. The fact that the British
raised their tariffs did not therefore
open the way to any reprisal. Ameri-
can goods were, for example, excluded
from the British market where they
competed with British and this in
sured an increase in British produc-
ton. But, since British goods we're
already excluded from the American
market, no domestic gain could bal
ance the foreign loss
The figures are themselves eloquent
of what took place. Between 1929
and 1888 British exports shrank by
81 300, 900, ,000-but British imports
by S2.700,000, ,000 BY contrast, while
American exports dropped of by
$4,000, 100000. American imports fell
by only s3,100,000,000. On balance,
British exports had been reduced by
$500, 100000 less than imports. The
drop in American exports, on the other
hand, was S800,O00,OO0 more than
that in imports. All of which means
simply that the British we're recaptur-
ing their home market and substi-
tuting domestic business for foreign
while the Americans were faced by a
decline in exports due to the multiple
cation Of tariff barriers and a decline
in domestic production due to a
shrinkage in local consumption.
OF course, this process cannot go
on Indefinitely and Chamberlain him
self, in another recent speech, asserted
that Britain must henceforth. expect
an unemployment total of 1000 900
for an indefinite period. Industrially,
the British have thus taken up the
slack. Agriculturally, on the con-
trary, there is still vast opportunity
for domestic expansion. When the
British went out for free trade, they
abandoned their fields for their fac
tories and undertook to exchange
manufactured goods for foodstuffs.
Now that they have abandoned free
trade they will have to expect fur
ther shrinkage in foreign purchases
of their goods.
Training for Farms.
They can, of course, offset this re-
duction by raising their own food. But
this change will take much longer
time than the industrial tranSforma-
ton which is now nearly completed
For it will be necessary to train a
new generation to the farms. In the
long run, however, it is by no means
that additional employment
in agriculture will counterbalance the
permanent elimination of a consider
able portion of the workers in coal,
iron and shipbuilding industries.
the men trained to these
permanently depressed industries will
have to be supported, since they cam
not be absorbed.
The British problem will be made
the easier by reason Of the fact that
the population of the British Isles
is already stationary and is destined
to decline at an increasingly rapid
rate during the next few years. Eng
land is thus changing from one
sided to a balanced economy. Under
pressure and because of the shrinkage
in the foreign markets for her man
ufactures she Is undertaking to read
just herself to do her own manufac-
turing and to raise her own food.