teach, the foreigner has learnt in another way.

He uses State influence; so did we. But he uses it for the purposes of retaliation. Who commenced the illegitimate procedure of underselling, with State assistance, the foreigner in his own market? It is to little purpose to say that England acted as she did to make trade free. The world is not so shallow-brained as not to perceive that what England did made her manufacturers rich. And thus the lesson the foreigner has learnt from England is to make his goods cheap, not by reducing the cost of production, for that is a process which would interfere with the equable progress of his country's internal trade, but by granting a bounty. The manufacturers of England have been foiled by the duties imposed upon their goods in the markets of the foreigner; they are undersold in neutral markets by means of the bounty system. Thus have they been checked. Under present conditions they cannot advance on the commercial chess-board. Unless they recede, what will prevent them from being irretrievably ruined ?2

When, then, a new element is introduced in the conduct of our trade and commerce, unless it is a legitimate one, such as the discovery of the shuttle or the application of steam, it becomes a serious question from the very first, whether or not it may be the starting-point of a series of foreign retaliations? The merchant of

1 The reader must calculate the different results of universal free trade upon rich and poor countries respectively.

2 But recently an agreement has been entered into on the question of the sugar bounties. By means of the foreign sugar bounties, the British consumer acquired his sugar cheap. But this "cheap" sugar threw our labour out of employment. If the agreement is ratified, the price of sugar will be raised to the British public.

England asked for assistance in order that he might ruin, perhaps, the foreign manufacturer. That was in 1846. But now foreign manufacturers apply to their respective States for precisely that same assistance which the Englishman succeeded in obtaining when the Corn Law was abolished, but in a different form. They have their internal markets protected by efficient 1 duties; they are also assisted in neutral markets by means of a bounty.

What real difference exists between these two forms of State assistance? Both of them had the same objects in view. But while one succeeded for a time only, the other bids fair to maintain its efficiency so long as its principle endures. Free trade created for the English merchants an artificial demand in foreign markets; but after that demand was brought into existence, it could exercise no control over it. Foreign countries might or might not protect their manufacturing industries. Cobden thought they would not be able to develop them under the new system. It has happened that all nations (with one or two exceptions) have become strictly protective. The consequence is, that foreign demand for British manufactured goods is continually decreasing, as well absolutely as relatively.

It is upon this ground, therefore, that we base the distinction between a "normal" and an "artificial" demand. The railways operated in a legitimate fashion

1 From the fact that such duties have been raised during recent years, it appears that foreign statesmen lay more stress upon the employment of labour than upon cheapness of price.

2 As matter of pure theory, the free-trade demand is merely an "increased” demand. Experience determines whether it shall be an artificial or a normal one. If universal free trade existed, it would be a

by facilitating transit. Free trade, on the contrary, acted by altering the principle on which our trade with foreign nations was conducted. Nothing could interfere with the improvement in our internal trade by the railway system; and the manufacturers possessed through it, had they been content with an equable progress of their trade, a legitimate means of lowering prices and of their competing more advantageously in foreign and neutral markets. But free trade lost us all control over our industries. Thus it happens that the course which those industries shall take is dictated by the foreigner. Even under this dangerous condition the free-traders comfort themselves with the maxim that, if the foreigner can produce more cheaply than we can, we must divert our labour and capital from less to more remunerative sources. When we reach the last of that imaginary series of remunerative trades in this country, it will be time, we think, even for the free-trader to pause and consider where, after the next commercial disaster, our labour and capital are to be applied.

There is another point in connection with this distinction between a "normal" and an "artificial” demand which will attract the reader's attention. It refers to the influence of these respective sorts of demand upon the growth of our trade and commerce. There is nothing to interfere with the progress of our trade when demand is increased in a normal fashion. If we look back upon the effect of the discovery of the shuttle, we find that the whole of our manufacture was

"normal" demand; but other nations being protective, it becomes "artificial."

raised thereby to a larger volume. But though it experienced this accession in size in a shorter time than a consideration of its past advance warrants,1 the additional increment was maintained, while the subsequent course of our trade in manufacture suffered from just the very same rises and falls which previously had characterised it. This continued till Huskisson's improvements in our intercourse with foreign nations; and all these were based upon the system of reciprocity.

But compare the sudden increase in the growth of our trade when the three factors leading to prosperity all began to operate, with (1) the moderate increase consequent upon the introduction of the shuttle; and (2) the alterations which Huskisson effected in our commercial code. You will observe a vast difference. This, however, is in some degree reduced when you take away the shares of the railway and increased currency. What remains properly belongs to free trade. And what the original intensity of this force was may be roughly derived from an examination of the exports between the years 1850 and 1875.2

This fitful increase induced by free trade, like all other sudden operations in nature, could not be a per

1 We regard this result of the shuttle discovery as a transformation. The seeds of improvement were inherent in manufacture. The bud had only to open and display the leaf.

2 Allowing free trade a third part, for the purpose of illustration, of the increased exports, there is due to it £51,000,000 per annum up to 1873. In 1864 our whole trade, under protection, would have been something more than £73,000,000, and in 1869 something more than £78,000,000. This is calculated from the rate of increase of our export trade up to 1842, and does not include the advance which the gold discovery and railway extension brought about.

manent increase. You cannot expect an export trade all at once to more than double itself, and very soon to become more than quintupled, and to retain for any length of time the higher level to which it was forced from above, not gradually elevated from below. Sudden changes are foreign to the normal and stable growth of trade, just as those changes are indicative of danger in other spheres of natural operations. To ensure stability, you must progress slowly and steadily.1 No better illustration of this principle can be afforded than that derived from the acquisition of knowledge. But the contrast of this “fitful” increase, sure to occur under free trade, with the "steady" increase under protection, was not undertaken by Cobden and the free-trade manufacturers. There was no room for contemplation of this sort in Cobden's busy brain. For his imagination led him into far different regions of thought than those immediately concerned with the safety and security of trade progress. He contemplated the supremacy of British manufactures. He believed that the world of commerce would fall prostrate before the idol of free trade which he had unveiled. He dreamt dreams of a higher and better state of things. But all his schemes. were shadows; they were void of substance.2 There must be always a period of transition between the origi

1 The sudden growth induced by free trade I compare with the growth of a mushroom. It assumed large dimensions in a short time. But the springs of its nourishment being attracted by other organisms, it decays as rapidly as it developed.

2 Instead of attending to the scarcity of the sources which fed our manufactures, he merely contemplated a sudden growth. He pandered to a temporary demand, without regard to any future influence of his measure upon labour. Huskisson, on the contrary, protected the springs of labour.