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instance, an increased activity; and the shallow-minded will think that depression has been swept from our midst. But after a time, when the stimulus has become spent, we shall again experience decline; and with this decline will be associated the evils of an altered currency.

But why will depression return, and at no distant date ? Because the demand thus created is a temporary demand, exactly like that “demand” induced by free trade. Does free trade supply us with a constant demand from neutral and foreign markets ? No; because we cannot produce even cheap enough. Our foreign demand depends upon this element. Why, then, did the British manufacturers alter the law in 1846? Was it not that, by cheapening the rate of living, they might produce at a less cost, and thus be enabled to undersell their rivals ? This was the intention, but it has not been carried into effect permanently. For nowadays free-trade labour, in spite of the cheap loaf, is dearer, instead of becoming cheaper, than the labour of protective nations.2

Thus we see that depreciation of silver, instead of being the cause, is the result of our hampered trade. So long as there is a great preponderance of silver over gold, and so long as gold rules the price of silver, then silver must become depreciated gradually, and almost imperceptibly. It has depreciated ever since the production of gold became unremunerative. But it caused

1 In the case of foreign markets, the heavy duties counteract the cheapness of our goods. In the case of neutral markets, this cheapness is met by bounties.

2 The main reason of this is found in the fact that foreign labourers are content to live at a cheaper rate.

no calamitous symptoms. Why is it, then, that this factor of the depreciated silver currency should be regarded as the cause of distress? Is it to divert attention from the real cause ? or is it to commence a policy of commercial opportunism—a sort of policy which we have seen is so disastrous in other lines of State conduct? If, indeed, the free-traders are confident that other nations will in time follow the commercial policy which we have begun, then the reason for this opportunist diversion is evident. But it is not at all probable that such an alteration is within a reasonable distance of being accomplished. All the facts point to the contrary conclusion. It becomes all the more urgent, then, to discern not only what a bi-metallic standard will effect, but what other nations are doing ; to analyse the basis upon which this depreciation of silver is afforded a precarious prominence in the causation of distress.

But regard it in the light that it tends to aggravate a depression brought about by another cause, and that it will have no permanent influence upon our external demand, and you place this factor in its true position. Perceive that this demand for our goods on the part of foreign and neutral markets is determined by separate forces, which, as they originate in State interference can only be met by State interference, and you arrive at the true solution of our manufacturing distress.

1 This depreciation of silver was in operation before the commencement of the depression from which we have so long suffered ; but it was unnoticed, because demand continued brisk. But without a brisk demand, it comes to be regarded as a potent factor.

2 And this in face of the recently proposed changes in the American tariff. The new policy is that of making trade more free under protection. And it is on the same lines as Huskisson's reforms.


Limit your field of inquiry to the several elements which affect this external demand for our goods, and you will very soon reach the central difficulty in the problem of distress.

It is for this precise reason, inasmuch as it does not affect in a permanent manner our external demand, that the remedy of bimetallism is to be avoided. It will effect a temporary good; but it will also produce collateral evils. And when its stimulant effect has disappeared, we shall then have not only to deal with evils arising from one cause, but also experience a mixture of disasters, springing from a twofold source.

§ 38. The construction of a "political powerout of a monopoly.—It is one thing to localise a cause; but it is quite a different one, in political matters, to impress the various classes of society with its importance. It is often asserted that the “people” were effective in repealing the Corn Laws. The growing democracy was led by Cobden. But then, on the other hand, it must also be considered that, as society progresses, political power changes its seat. Admit that the preponderant power was made to reside in the “people” in Cobden's times, where is it located now? Since his days a new class has arisen, not of kind but of degree. Those who subsequently became the income-tax-paying classes were, at the time of the free-trade agitation, comparatively a small class to what they present nowadays. The authority wielded by this class is very great, but it is very unequal in different sections. There can be little doubt that the larger part are suffering from the burdens of taxation. Both with the depreciation of silver and the lowering of prices, they find that their present incomings bear a greater proportion to their outgoings than they did when prices were high and the country in a general state of activity. Allow, for the moment, that an income of £600 twenty-five years ago is equivalent to £400 to-day, from the depression of manufacture and its collateral effects, do taxes diminish in the same ratio ? On the contrary, they rise; for, as we are told, with the increasing wants of society, “as progress is effected,” the expenditure of the State has to be increased. This misfortune does not affect all the sections of the great middle class. It does not affect the brewers and the public-house interest; it does not affect all those who have a monopoly of prices—the master-butchers and the fish merchants. But it affects adversely all those who produce articles which have a reduced demand, as well as those whose fixed incomes suffer from the general stagnation of busines. Hence the opposite accounts of a serious state of commercial affairs; and this state asserted by some to be non-existent even, or, if allowed, by others, extravagantly overrated. The opinion of the individual is coloured, according to the degree in which he finds his resources contracting.

But the statement that the verdict of 1846 was the result of the “popular will ” may be contested. And on these grounds. Everybody knows the influence then exercised by the manufacturers. They had only to discover to their labourers the share which their class would receive from the spoils of the new policy, and they were assured of their support. Pressure, too, might be brought from another direction. If they, the

labourers, did not support their masters on this occasion, so great had become the difficulty with which the manufacturers had to contend in foreign markets from the rivalry of the foreigner, their wages would inevitably have to be reduced. Now, no question can be made that this difficulty, assumed (as we know from the state of exports) either speciously or ignorantly, was widely entertained.1 And what we have just stated is the logical conclusion of that opinion.

If the manufacturers exercised so much authority in 1846, are they still masters of the same amount ? By no means. Their attitude to the labourer has changed with the change in the surrounding conditions of the national labour. Besides, the chief power has shifted from off the shoulders of manufacture and her dependants into the arms of the income-tax-paying classes, of which there are two chief sections. We have the brewers and the licensing system, with a monopoly or two on the one hand; and the producers of goods other than necessaries, and those enjoying fixed incomes, on the other. The present fiscal arrangement suits the interest of the former, for it is by the continuance of the malt-tax that the prices of both beer and butcher's-meat are maintained. And thus do we perceive the anomaly of a section of the community deriving aid from State interference, when that assistance is denied to interests of far higher importance. To what end, except for the purpose of buying political support, is doubtful. But in the

1 In Huskisson's times the manufacturers made complaint of the opposition they experienced, both from the United States and Germany. That statesman's advice was, to foster the interests of their labour, to regard its equable advancement, and to prevent it from be. coming too rapidly dearer than that of their rivals.

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