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 Notes on Insular Free Trade, which had been previously circulated as a cabinet memorandum. The next day appeared the Board of Trade Fiscal Blue-book. And on the 18th the resignations were announced, not only of the more rigid free-traders in the cabinet, Mr Ritchie and Lord George Hamilton, but also of Mr Chamberlain. Letters in cordial terms were published, which had passed between Mr Chamberlain (September 9) and Mr Balfour (September 16). Mr Chamberlain pointed out that he was committed to a preferential scheme involving new duties on food, and could not remain in the government without prejudice while it was excluded from the party programme; remaining loyal to Mr Balfour and his general objects, he could best promote this course from outside, and he suggested that the government might confine its policy to the “assertion of our freedom in the case of all commercial relations with foreign countries.” Mr Balfour, while reluctantly admitting the necessity of Mr Chamberlain’s taking a freer hand, expressed his agreement in the desirability of a closer fiscal union with the colonies, but questioned the immediate practicability of any scheme; he was willing to adopt fiscal reform so far as it covered retaliatory duties, but thought that the exclusion of taxation of food from the party programme was in existing circumstances necessary, so long as public opinion was not ripe. At the same time he welcomed the fact that Mr Chamberlain’s son, Mr Austen Chamberlain, was ready to remain a member of the government. Mr Austen Chamberlain (b. 1863) accordingly became the new chancellor of the exchequer; he was already in the cabinet as postmaster-general, having previously made his mark as civil lord of the admiralty (1895–1900), and financial secretary to the treasury (1900–1902).

From the turning-point of Mr Chamberlain’s resignation, it is not necessary here to follow in detail the discussions and dissensions in the party as a whole in its relations with the prime minister (see ). It is sufficient to say that while Mr Balfour’s sympathetic “send off” appeared to indicate his inclination towards Mr Chamberlain’s programme, if only further support could be gained for it, his endeavour to keep the party together, and the violent opposition which gathered against Mr Chamberlain’s scheme, combined to make his real attitude during the next two years decidedly obscure, both sections of the party—free-traders and tariff reformers—being induced from time to time to regard him as on their side. The tariff reform movement itself was now, however, outside the purely official programme, and Mr Chamberlain (backed by a majority of the Unionist members) threw himself with impetuous ardour into a crusade on its behalf, while at the same time supporting Mr Balfour in parliament, and leaving it to him to decide as to the policy of going to the country when the time should be ripe. In his own words, he went in front of the Unionist army as a pioneer, and if his army was attacked he would go back to it; in no conceivable circumstances would he allow himself to be put in any sort of competition, direct or indirect, with Mr Balfour, his friend and leader, whom he meant to follow (October 6).

On October 6th he opened his campaign with a speech at Glasgow. Analysing the trade statistics as between 1872 and 1902, he insisted that British progress involved a relative decline compared with that of protectionist foreign countries like Germany and the United States; Great Britain exported less and less of manufactured goods, and imported more and more; the exports to foreign countries had decreased, and it was only the increased exports to the colonies that maintained the British position. This was the outcome of the working of a one-sided free-trade system. Now was the time, and it might soon be lost, for consolidating British trade relations with the colonies. If the mother country and her daughter states did not draw closer, they would inevitably drift apart. A further increase of £26,000,000 a year in the trade with the colonies might be obtained by a preferential tariff, and this meant additional employment at home for 166,000 workmen, or subsistence for a population of a far larger number. His positive proposals were: (1) no tax on raw materials; (2) a small tax on food other than colonial, e.g. two shillings a quarter on foreign corn but excepting maize, and 5% on meat and dairy produce excluding bacon; (3) a 10% general tariff on imported manufactured goods. To meet any increased cost of living, he proposed to reduce the duties on tea, sugar and other articles of general consumption, and he estimated that his scheme would in no case increase a working-man’s expenditure, and in most cases would reduce it. “The colonies,” he said, “are prepared to meet us; in return for a very moderate preference, they will give us a substantial advantage in their markets.” This speech, delivered with characteristic vigour and Imperialistic enthusiasm, was the type of others which followed in quick succession during the year. At Greenock next day he emphasized the necessity of retaliating against foreign tariffs—“I never like being hit without striking back.” The practice of “dumping” must be fairly met; if foreign goods were brought into England to undersell British manufacturers, either the Fair Wages Clause and the Factory Acts and the Compensation Act would have to be repealed, or the workmen would have to take lower wages, or lose their work. “Agriculture has been practically destroyed, sugar has gone, silk has gone, iron is threatened, wool is threatened, cotton will go! How long are you going to stand it?” On October 20th he spoke at Newcastle, on the 21st at Tynemouth, on the 27th at Liverpool, insisting that free-trade had never been a working-class measure and that it could not be reconciled with trade-unionism; on November 4th at Birmingham, on the 20th at Cardiff, on the 21st at Newport, and on December 16th at Leeds. In all these speeches he managed to point his argument by application to local industries. In the Leeds speech he announced that, with a view to drawing up a scientific model tariff, a non-political commission of representative experts would be appointed under the auspices of the Tariff Reform League to take evidence from every trade; it included many heads of businesses, and Mr Charles Booth, the eminent student of social and industrial London, with Sir Robert Herbert as chairman, and Professor W. A. S. Hewins as secretary. The name of “Tariff Commission,” given to this voluntary and unofficial body, was a good deal criticized, but though flouted by the political free-traders it set to work in earnest, and accumulated a mass of evidence as to the real facts of trade, which promised to be invaluable to economic inquirers. On January 18th, 1904, Mr Chamberlain ended his series of speeches by a great meeting at the Guildhall, in the city of London, the key-note being his exhortation to his audience to “think imperially.”

All this activity on Mr Chamberlain’s part represented a great physical and intellectual feat on the part of a man now sixty-seven years of age; but his bodily vigour and comparatively youthful appearance were essential features of his personality. Nothing like this campaign had been known in the political world since Mr Gladstone’s Midlothian days; and it produced a great public impression, stirring up both supporters and opponents. Free-trade unionists like Lord Goschen and Lord Hugh Cecil, and the Liberal leaders—for whom Mr Asquith became the principal spokesman, though Lord Rosebery’s criticisms also had considerable weight—found new matter in Mr Chamberlain’s speeches for their contention that any radical change in the traditional English fiscal policy, established now for sixty years, would only result in evil. The broad fact remained that while Mr Chamberlain’s activity gathered round him the bulk of the Unionist members and an enthusiastic band of economic sympathizers, the country as a whole remained apathetic and unconvinced. One reason was the intellectual difficulty of the subject and the double-faced character of all arguments from statistics, which were either incomprehensible or disputable; another was the fact that substantially this was a political movement, and that tariff reform was, after all, only one in a complexity of political issues, most of which during this period were being interpreted by the electorate in a sense hostile to the Unionist party. Mr Chamberlain had relied on his personal influence, which from 1895 to 1902 had been supreme; but his own resignation, and the course of events, had since 1903 made his personality less authoritative, and new interests—such as the opposition to the Education Act, to the heavy taxation, and to Chinese labour in the