plicity of opinions, whether mutual free trade would diminish trade jealousies and national antipathies. But there are certain data we can use in arriving at a judgment on this matter. Our markets for manufacture are much larger than the markets of the foreigner for other commodities. Which market, then, has the most advantages? Suppose that a free trade did exist between two nations, and the one received more than she gave, there would be a difference to pay. It might be paid in securities, or it might be discharged at some future time by exports, or the debt might be allowed to remain and the interest alone paid, and that in one or the other or both of the above-mentioned methods. Would such a trade policy be the source of jealousy and animosity on the part of the indebted nation?

Let us take one other supposition. In the period between 1850 and 1866 our manufacturers grew enormously rich at the expense of other nations. There are many who think that our manufacturing prosperity was due to free trade alone.1 But while such was not the cause, let us suppose that foreign public opinion is to this effect: "Had free trade been mutual, England's gain would have been doubled, perhaps trebled, by our markets being open to her. Could we hope to equal so gigantic a success? No. Our means are unequal. The inequality would be against us under free trade. But under her partial system of free trade we shall make our conditions in the course of time equal, by

1 When free trade began to operate in favour of manufacture was towards the end of her period of prosperity. It did not actually benefit her during the first stage of prosperity. We must, however, regard the "moral" influence of the policy on that stage.

protecting our industries; and eventually unequal, by encroaching upon her markets. Then the inequality being in our favour, we shall be able to repay a part of our old debt."

We take this to be the attitude of protective nations towards free-trade England. It is as clear that only on such lines could they ever hope to discharge the capital of their debt, as it is clear that, had they become free-traders, they certainly would have increased it.

What has been the reaction of this free-trade policy on ourselves? It has tended to make things as cheap as possible;1 to favour consumption while it depresses production.

The old trade maxim was to curtail imports; the free-trade maxim is "increase them." The protectionist said, "Let us supply ourselves as far as we possibly can;" the free-trader rejoices that our markets are open to the produce of the world. But as the progress of our trade phenomena under protection has become seriously altered under free trade; as, instead of advancing exports to meet the wants of an advancing population and relatively stationary imports, we are face to face with stationary exports (without any reference to an annual increment of 374,000) and increasing imports,-certain new theories of the prosperity of our trade have been framed in defence of the free-traders. Thus the protectionists were wrong in inferring the state of the nation from the condition

1 But not equally. Though the tendency exists, other forces are brought into operation to counteract it. Thus an irregular state of prices is brought about.

of our export trade. Thus Sir Robert Peel was wrong. On this point the free-traders of to-day must allow their illustrious convert to be no trusty authority. The freetrade view, to meet the altered state of affairs, is that the prosperity of our trade is to be measured not by exports alone, but by exports and imports combined. The free-traders are thus enabled to give in glowing terms a very favourable description of the prosperity of our "whole trade." "If we can afford to import to so large an extent, and thus make our trade more prosperous, surely it is a sign rather of our growth than decadence."

But it may be remarked here, so that the reader may keep the true course of events clearly in view, that there are two ways of regarding these excessive imports. We may relate them to the capital or to the labour of the nation. Taking the latter relationship first, we find that the present produce of our labour is too small to pay for all our imports. But we might very well employ more labour. And a certain proportion of our labour is displaced by the free admission of commodities which we could produce ourselves. Hence we must pay for the surplus amount, beyond what is met by the produce of present labour, with capital or the interest of capital. This capital is the result of past labour hoarded up and invested to a large extent in foreign securities, and then we arrive at the free-trade explanation of international debts. Such are "merely deferred exchanges of labour." In this way the late Professor Bonamy Price explained why it was that our imports continued excessive. We are thus spending some of the capital of our foreign securities at the same

time that we are consuming the interest of the rest, in exchange for the produce of foreign labour.1 But the Professor saw no reason to complain of such a state of things. We acquired capital, or the representative of capital, in bygone ages. That was a sign of prosperity. But now we are not even paying for our imports with the produce of present labour; we are consuming capital; and this is called also a sign of prosperity. But what says the labouring interest of the country? "Foreign exchanges have come to affect the capitalist's interests: those who can afford to pay acquire commodities at the cheapest possible price, but they pay not the labour of this country but that of a foreign one. But we could, and did under protection, (and under protection trade was made as free as it could be made, with reference to surrounding conditions), produce all those, or most of those, foreign commodities we now consume at the expense of the national labour. The interest of consumers no longer reaches to us exclusively. And the consequence is, that part of our productive sources are disused. How, then, can we consume if we do not produce? So far as one part of the community is concerned, and it is that part of the labouring community which is thrown out of employment by foreign competition, cheap bread has no more virtue than dear bread, if we cannot earn a due and proper wage."

But as regards those who are employed, can they be

1 The twofold process must not be forgotten, in spite of plausible free-trade assertions. Undoubtedly we consume the interest of our foreign investments. This does not, however, preclude the possibility of spending some part of our capital invested abroad.

said to be in any better position (in that position, for instance, which Cobden expected they would be placed), when the proportion of their wages expended on necessary articles of consumption is the same or a little more than under the old system of protection? Add to this that their rents have increased. And yet another item; that competition amongst themselves, owing to a constantly decreasing demand for their labour, has reduced their wages to the lowest point. And then inquire what caused this untoward alteration in the demand for their labour? What disturbed the balance of population in town and country?1 And what made their rents to rise?

Cobden complained in his day, that the agricultural labourer, after the payment of all his expenses, had but little to spend upon luxuries and sight-seeing. Exactly the same description applies to the town labourer of today. But Cobden did not complain that they were unemployed; he desired that their wages should be relatively higher. We complain now that they are unemployed; and that the cheap bread which Cobden was the principal means 2 of acquiring for them, has also been accompanied with a gradual, insidious, and therefore all the more treacherous, deprivation of the sources of their employment. For when the springs of employment are slowly destroyed, the process of destruction is apt to remain unobserved, except by those who trace the tendencies in operation to effect it. A cause acting gradually produces not a sharp and sudden explosion, as was

1 See table at the end of chapter.

2 He was the head of an organisation supported by the gold of the manufacturers.