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influence of a universal free trade ?1 The manufacturers were haunted by the vision of wealth; Cobden was spurred on by the dream of a better state of the affairs of the world, to be induced primarily by free trade. And it is curious, that neither of them had the interests of their country singly at heart. For we have it, on Cobden's own authority, that there was not one of the manufacturers, in 1837, but thought that free trade would destroy agriculture.2

But, in spite of their original opinion, the manufacturers pursued their own ends without regard to the adverse influence of their policy upon agriculture; while Cobden, in his endeavour to fraternise nations (which, as it seems, have not been attracted by the gentle insinuations of the free-trader), left his country's trade upon a dangerous, because insecure, basis.

His final object, however, was a meritorious one. It was nothing short of destroying the springs of war. Meanwhile, in the first step which is being taken towards this goal, the free-trade nation is nearing the brink of ruin. But perhaps the free-traders, who are also cosmopolitans, look upon this disaster with equanimity, and as if it were in the ordinary course of events, because it is an effect of free trade. And the free-trade principle, in their hands, is sacred.3 "It

1 In this connection, let us remember the influence which the people of all countries were, in Cobden's opinion, to possess upon the powers which ruled them. It is well known that Cobden visited the United States and France. What was the effect of those visits? Did the cause of universal free trade gain by them?

2 P. 49.

3 Cf. Cobden, pp. 187 and 188, where "free trade is something more than a remedy for present evils."


cannot do any harm to the nation, because it was intended to do good to it."

§ 18. What the action of free trade depends upon.— Now the free-traders may be reminded of a very simple fact known to science, that the principle of free trade in itself is just as harmless, contains as many virtues, can create as much good or evil, as any other principle, when not in action. Only do we become aware of its virtues and vices when it is brought into relation with surrounding conditions. As it is in their nature to vary, and not in that of the principle, and as they determine its action, it follows that the operation of the principle tends to fluctuate. Now all are ready to admit that the surrounding conditions of our trade markets to-day are not what they were in 1850 downwards to 1866; and hence, that the effects of the principle of free trade have changed. But if they have changed, the change must either be to our benefit or the reverse. The free-trader argues that it still acts (but with less force) for our good.1 The protectionists, on the other hand, assert that all those phenomena predicted of old by the Tory party have come to pass; that the turning-point of an artificial prosperity has been passed; and that free trade, which is nothing more than a system of free imports, is the source of the depression of our agriculture and manufactures.2 But

1 Sir T. H. Farrer in 'Free Trade v. Fair Trade,' chap. xi.

2 Lord Penzance (various articles in the monthly journals); Mr Howorth ('Times,' Jan. 7, 1886); Mr Sampson Lloyd (letters published in 1882); Mr F. T. Haggard (three letters to Professor Bonamy Price, 1887); Mr Howard Vincent (on the public platform, and in Parliament).

there is no doubt that free trade is now acting with less intensity (assuming, for the moment, the freetraders' conclusion to be correct) than formerly. Then what is the cause of that less intensity of action? Clearly, it is in the nature of a counteracting cause. What the free-traders have to consider, even on their own supposition, is not merely whether the action of free trade is prosperous, however small the degree of prosperity may be. It is not sufficient to say that free trade is not so prosperous now, for in this way you conceal the real issue of the problem from view. The real issue depends upon the relation of a less degree of prosperity now with a greater degree of prosperity formerly. This is the plain statement of the case. And the question to be considered is, obviously, whether the counteracting force, which has already caused a diminution of an unparalleled prosperity, will be able in future to destroy that remnant of prosperity which the freetraders imagine (we think vainly J) still remains. This is the anticipation; it is upon this that you must build up a more secure policy. For the longer that counteracting force acts, and the more intense it becomes—no one can possibly deny it—the more we are losing, and will continue to lose, ground. But does the free-trader fondly hope that the intensity of this counteracting force will be arrested? Does the reader suppose that the surrounding conditions of foreign markets, and of our own even, will stand still to enable the free

1 The free-traders admit the existence of depression; they admit also that it is increasing. Still, even with these admissions, they assert that free trade yet benefits the nation! How do such harmonise their opinions with Cobden's "free trade to raise up a real and permanent prosperity"?

trader to trade prosperously at the expense of protective nations ?1

It is an unfortunate thing for the science of political economy that three forces, all tending more or less to increase production, promote circulation, and stimulate enterprise, should have come into operation almost simultaneously. It is unfortunate, because it is wellnigh impossible to award each force its proper share in the causation of the prosperity which ensued upon their combined operation. But if it is difficult to calculate the exact effect of each cause, it is easy enough to define generally the manner in which they operated. Everybody will agree as to the way in which the increase to the currency acted. But perhaps there will be some demur to the distinction, which we take to be a capital one, now going to be made between the operation of the railway system and the action of free trade. Both of them increased demand. But the distinction which we make between these increments to the original demand is this. The increased demand brought about by the railway we call a "normal" increase, because it was effected in a proper and legitimate way. In this it is comparable with all those discoveries which tend to increase production while they lessen the amount of labour spent upon it. But the "increase" which free trade accomplished we call an "artificial" increase. A

1 Some countenance may be given to this hope from a recent utterance of the President of the United States. An opinion is entertained in this country that Mr Cleveland is a free-trader. The policy he enunciates is just the policy of our own Huskisson, and nothing more. It amounts to "making trade more free under protection." Were he styled a limited free-trader, much misunderstanding would be removed.

demand, not in the ordinary course, was created for British goods in foreign markets by overstocking them with cheaper articles than the foreigner was able to produce. Such a demand was not a stable demand. And to have legislated upon the anticipation that it would be for ever a constant and a stable demand was to legislate upon what had no foundation in any except a prejudiced fancy. The British manufacturer saw the opportunity presented to him of being able to undersell his rivals on the Continent. It turns upon the nature of this "underselling" as to whether the demand would or would not be a stable one. It was brought about, on the solicitation of the manufacturers, by an Act of Parliament which repealed the Com Laws. By this Act the State assisted1 the manufacturer to produce his commodities at less cost. He was therefore enabled to sell his goods at a cheaper rate abroad.

It was in this way that Cobden and the manufacturers met the real or assumed encroachments of their foreign rivals. If real, it is quite obvious that Cobden, in his endeavour to further the fraternisation of peoples, forgot, in his frenzy to reach his goal, the obligations which international morality (had he considered this branch of international science) would have imposed upon him. But the lesson which Cobden desired to

1 To meet this true statement of the nature of the change, the freetrader asserts that prices before 1846 were "artificial" ; they became "natural"—i.e., reduced to the level of external markets—byfree trade. But against this may be said : 1. The improper currency, before 1846, made prices unnatural. 2. On the supposition that the protective system tended to keep prices higher than they would be under free trade, how can prices now be called natural when checks are still in existence, and used by other nations, to prevent prices from reaching the level of a universal free trade?

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