Page:The Bank of England and the State, 1905.djvu/67

 must become dearer, for this is the very essence of the scheme; if it did not, the Colonies could not derive any possible advantage from it. On the first introduction of such a scheme, the home producer would unquestionably benefit by the rise in price, until the Colonies are enabled to increase their production through the acquired stimulus, when they would begin to gain, and if the scheme be successful in bringing about what is claimed for it, viz., the diversion of trade now carried on with foreign countries to our Colonies, then the home producer must again lose what the latter gain; in fact, in the end he will be worse off, because all the incidental expenditure, and the plant and machinery acquired under the temporary stimulus of higher prices will be wasted when Colonial imports attain such proportion as will secure the Colonies a benefit. Another consideration is suggested, viz., that the foreign producer will pay the duty that may be imposed: this is a consideration which, before an audience of men of business I need only mention in order to dismiss. Men of business know only too well how much any charge, however slight, must ultimately raise the cost of the article to the consumer.

But what would follow from the carrying out of such a scheme is that, whereas we have now competition between a number of different sources of supply which keeps prices down, the inevitable consequence of a preferential tariff on food-stuffs would be the absence of all competition, our being restricted to one source only, and it is to be expected that prices would consequently rise to an extent greater than the duty to be imposed. What the dangers would be if our food supplies were to be derived from one source only must be apparent to all business men. It is manifest how such a market would lend itself to manipulation, and, worse still, what would happen if bad seasons should occur. We have an object-lesson before us now in the shortage of the cotton crop in the United States, which may have a most serious influence on our cotton industries. What would happen if a shortage in the crops were to occur in Canada? We could not then rapidly fall back on the various