arrest the growth of a morbid enthusiasm, lest it assume too formidable dimensions.1 But such a happy consummation is only possible when the true sequence of phenomena ending in the popular expression of a grievance is well understood by those whose business it is to inquire into them. There are many influences which oppose the redressing of such grievances. Sometimes such an influence resides in the interests of a party. We doubt not but what the proposed reversal of our partial free-trade system will be bitterly opposed by the national Liberal party. But it will be for the electorate to decide what course of trade will best promote the interests of the country. Again, take any medicinal drug or poison. So long as it remains upon the shelf of the druggist, it produces no effects. But bring it into relation with the various tissues of the body organism, and what results? All kinds of local and other effects. All the effects, then, that we can think of, are brought about by certain principles acting upon those surrounding conditions which are favourable to the development of their beneficial or evil consequences. Free trade is no exception to this general rule of principles. But where the great difficulty presents in the elucidation of economic phenomena is in the multiple effects which a single principle induces. This is because the surrounding conditions of the operating principle vary in this branch of industry, as

.

1 It might be adduced that free trade was promulgated to counteract Chartism. Cobden's dictum that "free trade was to save us from tyranny at one end and anarchy at the other," may be brought forward as a support to this view. Still, this view does not preclude another one-viz., that out of the disaster of the times a section of the community grasped the opportunity to promote a selfish end.

compared with those of that other one; in our dealings with one nation as contrasted with our dealings with another. Thus innumerable minor influences spring up to modify its action. But not only do these surrounding conditions vary, at any particular period, in all places, and in all industries, they also vary from time to time in each industry, and in our trade relations with all the nations of the world.

Thus do we meet face to face with the difficulties of unravelling the definite results of a complicated principle, on each occasion when we desire to estimate its especial influence. It is impossible in many instances to obtain such definite results, because some of the effects interact, and it is beyond our means to calculate the influence of such interaction. Hence the perils of trusting to mere figures; hence the dangers of founding reliable conclusions upon trade statistics. What we can only hope to achieve is to ascertain the main operation of the principle, without being able to precisely determine its intensity. And for this reason it has appeared to us the better course to follow the late Professor Cairnes's advice,1 and deduce tendencies first, and afterwards observe by signs and figures the influence of their operation. This is a course diametrically opposed to that pursued by the free-traders. They take their figures and facts and argue from them. On the other hand, it is the usual procedure to place such facts and figures in a subordinate position, and make them express the influences of tendencies which are originally assumed to be in existence. It seems to us that the

1 In the 'Logical Method of Political Economy.' Macmillan & Co. P. 105, Lect. III., "Economic problems not susceptible of exactness."

free-traders themselves do not care to inquire into the nature of these tendencies.

Such, then, is the hopeless nature of the task of estimating the exact result of each definite action of free trade. Perhaps it is by this circumstance that the freetraders have been enabled so long to satisfy their followers with a list of those general assertions, which appeal to an ideal state,1 but are very far from being compatible with the practical experience of those data, whose existence they ignore. If economical problems are solved as purely "ideal" problems; if the data involved are not then in existence, but only supposed to be so, or ought to be so, from the ideal economist's point of view, then it is quite certain there must be confusion between the theory of political economists on the one side, and its practice on the other. Such confusion cannot be present without disaster; and it must inevitably terminate in a war of opinions, where the public will learn that the abstract conclusions to which the "ideal" economists have ascended, are based upon no supports which present experience can afford them. In short, that the free-trade school of economists are no longer in touch. with what is going on in the commercial world; that they have left it in disgust at the wickedness of man; and that they argue in an abstract economic sphere of their own fanciful construction.

1 Cf. what Sir Robert Peel stated with reference to the adaptability of free trade to old and established interests on the one hand, and to young and growing states on the other. "If we had to deal with a new society, in which . . . complicated interests. had found no existence, the true abstract principle would be, 'to buy in the cheapest market and to sell in the dearest. And yet it is quite clear that it would be utterly impossible to apply that principle in a state of society such as that in which we live. . . .'

134

CHAPTER VI.

THE RELATION OF FREE IMPORTS TO THE HOME MARKETS.

"For himself, he had no hesitation in denying that the Corn Laws had anything to do with the existing distress in some of the manufacturing districts, or that they even contributed to produce it. It was not logical, or a legitimate mode of reasoning, to say that because Government came forward with a measure which, in their opinion, had a tendency to alleviate the present distress, to soothe the feelings of the sufferers, and to show a sympathy with their sufferings, that therefore they looked upon the Corn Laws as the cause of the distress. His opinion might perhaps be worth little upon this subject, but he must frankly and openly say that he did not look upon the Corn Laws as the cause of the present distress."—(May 2, 1826.)

"The evil under which the country now (1826) laboured arose from over-trading and a want of credit." 2

IMPORTANCE OF DISTINGUISHING BETWEEN

OVER-PRODUCTION-THE FALLACY OF

APPARENT" AND "6 REAL"

REDUCING PRICE OF BREAD

TO EXTEND LABOUR EXPOSED THE COMPLAINT OF THE MANUFACTURERS TO BE ON EQUAL TERMS WITH THE FOREIGNER COBDEN SAID THEY MUST HAVE BREAD AS CHEAP AS THEIR RIVALS HAVE IT DID SUCH A PROCEDURE BRING ABOUT EQUALITY? THE FOREIGNER STILL RETAINED THE MEANS OF INDUCING INEQUALITY OUR PRESENT COMMERCIAL SURROUNDINGS NOT IN ACCORDANCE WITH COBDEN'S ANTICIPATIONS-FREE TRADE WAS TO IMPROVE AGRICULTURE: IT HAS DESTROYED IT-FREE TRADE WAS TO SWAMP FOREIGN MARKETS WITH BRITISH GOODS-ITS REACTION HAS STIMULATED FOREIGN PRODUCTIONS.

§ 15. The moral influence of free trade in extending our trade-circulation with foreign markets.-Free trade 1 Huskisson's Speeches, vol. ii. pp. 556, 557. 2 Idem, ii. 567.

induced its due proportion of prosperity indirectly. Let us see the nature of the process by which that conclusion is reached,

Before free trade was ever introduced, our markets were from time to time overstocked; demand was overestimated; there was an excess of supply resulting from over-production. Now the sorts of this over-production are two,-1, A real over-production, ensuing upon the manufacturer's anticipation of larger markets; and 2, An apparent over-production, consequent upon the demand failing to consume that supply which past experience justified the manufacturer in producing. Unless the causation of over-production is strictly considered, the reader is apt to give his adhesion too hastily to certain views. It is in the nature of prejudice to snap at support. Oftentimes one single argument is sufficient to convince the unwary and those who have not given time and thought to the subject. But in economy it is a good rule to follow-"Be not fascinated by appearances. The argument is, on the surface, a taking one. Be on your guard lest you be deceived by those appearances." Let us give an instance of this. Suppose (and this actually occurred during the free-trade agitation) that, in the treatment of the causation of overproduction, an advocate states the case as follows:"You are convinced of the presence of a larger supply than there is demand to consume it. How comes about

1 Or, as M'Culloch put it, the cause of the glutted state of the markets resided in the miscalculation of the manufacturers - Political Economy, p. 202; where he also states "that those who investigate the history of industry, in this or any other country, will find that a period of peculiar prosperity in any one branch is the almost uniform harbinger of mischief."