Year: 1879




the House OF Lords two days since, show
that there is small section of the leaders
of English thought who are beginning TO
question the soundness of the free trade
policy which has been pursued since 1916.
We need not have waited for the late debate
on agricultural distress in the House OF
Lords and the recent discussion OF the
same subject in the Coblen Club to find
symptoms OF weakening OF English opln-
ion on the question of free trade, which
for twenty or thirty years seemed IRE
versibly settled There could not be
stronger evidence of the rising distrust
and misgivings than is furnished in the
June number of that vehicle Of vigorous
discussion, the Nineteenh Century. In which
two eminent statesmen and thinkers-Eari
Grey and Mr.. Lowe have strong articles
in defence of free trade. Champions OF
such note and mark do not come into the
arena for the defence of cause which Is
rot felt to be in danger. There is un-
questioIIably tendency in England, the
great free trade country OF the world, to
reopen this important question and submit
it to further discussion.


It deserves to be noted down that no
English statesman who ranks high either
for ability or Official position has exhibited
any symptoms Of vacillation as to the
soundness of the free trade policy. Not
even Lord Beaconsfield, who poured forth
! such torrents of invective against Sir
Robert Peel when, as the conservative
Prime Minister, Peel went over to the camp
of the free traders, has uttered a
word of distrust in these recent dis
cussions, and Sir Stafford Northcote, the
present Chancellor of the Exchequer, stands
firmly by the free trade policy. Its assail-
ants are men who have never established
any title to respect as thinkers on economi-
cal questions. With all the ablest English
statesmen and financiers on one side, and
mere neophytes and sentimentalists ar
rayed against them on the other, the re-
suit of the new free trade discussions cam
not be considered as doubtful. We believe
that British policy is immovably fixed on
the basis of commercial freedom.


1t is absurd to expect from free trade con-
sequences which its intelligent advocates
never promised. They never pretended
that it was a guarantee against commercial
crises, those most remarkable phenomena
of the modern financial world. One of
these great trade convulsons visited Eng
land in 1S47 and another in 1866, but no.
body at those dates was absurd enough to
ascribe them to free trade. On both occa-
sions they led to vehement discussions of
the merits and dement's of Sir Robert
Peel's Bank act OF 1874, which did
such catastrophes, and those assaults upon
the Bank act were pertinent to the occasions
which gave rise to them Commercial
crises are result of the modern system of
credit. They hinge upon the modern
method Of conducting trade through the
agency of banks. All merchants deposit
their funds in bank, which makes its
profits by loaning out at interest the de-
posits it receives without interest, or at a
lower rate Of interest than it pays to its de-
positors. The consequence is that bank,
though perfectly solvent, can never meet
all it's obligations on the instant. 1t regu-
lates its business on the average calls likely
to be made upon it for paying depositors !;
! but if sudden distrust or alarm impels
them all to demand payment at the same
time the bank is unprepared, and the fears
OF the merchants that they will not be able
to meet their engagements causes a panic
which leads to general infringement Of
business. Such crises have no relation to
free trade or protection. They occur in every
country which makes use of banking facili-
ties quite irrespective of its general CON-
mercal policy. AS the advocates of free
trade never professed to regard it as pre-
ventive of commercial crises it is mere
shallow absurdity to raise an outcry against
free trade If a country is visited with trade
crisis of unusual length and severity The
United States and Germany, which are
protectionst countries, have recently been
as heavy sufferers as England from CON-
mercial stagnation.


Neither is free trade guarantee against
the distress occasioned by bad harvests.
The grain crops of England have been de-
ficient for the last four or FIVE seasons and
this is the main cause of agricultural dis
tress in that country. To be sure, in q
country which excludes foreign grain by
high duties the shortness of crop is
partially compensated by high prices.
But this is benefit only to the
producers of grain, and is great evil
to the mass OF the population who
have to pay famine prices for their food.
The free importation of breadstuffs keeps
the food of the English people at moderate
prices, even after the worst harvests. The
great body OF consumers is benefited, and
the depression Of agriculture is due to un-
propitious seasons and not to free trade.
The repeal of the Corn laws has really
proved Il great benefit to British agriculture.
Cheap food has made low wages suffice for
] the snbsistence of the vast man U fact uring