1896

COMMERCIAL UNION OF THE EMPIRE

ONE of the principal and most powerful factors in promoting a mutual good understanding between Great Britain and her Colonies would be the establishment throughout the various parts of the Empire of a scheme, on a sound and satisfactory basis, of commercial federation, which should meet with general approval. Commerce is the lifeblood of civilised nations. It is the keystone of the structure which is their mainspring and support. It is the material element which inaugurates their social standing, political progress, and advance in prosperity and wealth. Pastoral and agricultural pursuits comprise the chief industrial occupations of all primitive peoples and savage races for the supply of their food and for the maintenance of their physical necessities. But, once a nation has emerged from the condition of its first natural environment, and has advanced along the road of an expanding civilisation, new conditions are developed and new wants created, which are supplied by the inventive spirit of man. As these are fulfilled they lead to a desire to circulate the various objects of utility and necessity which human ingenuity has produced, by some system of commercial intercourse between different communities, in the form of barter and exchange.

This is the embryo and germ of what is expressed in the wellknown and comprehensive term 'trade.' By instinct, by natural constitution, by the physical and mental energy of the Anglo-Saxon race, by quickness of apprehension for intelligently grasping the elements and cardinal principles of trade, the British nation has been long distinguished for the remarkable aptitude it has shown in successfully pursuing the great object to which for generations it has devoted itself. These principles, there cannot be a doubt, are of vital importance to a people so situated. It has long acquired for them the reputation of being emphatically the one among nations which is in the forefront and van of international commerce and world-wide trade. So decided has been this desire, and so energetically and indomitably has it been pursued by the genius of her people, that England has for centuries shown herself deter

mined to find fresh markets for the development of the manufactures her industry has created by penetrating every clime and endeavouring to exchange her wares for the productions or the gold of other nations which she could induce to trade with her.

All this demonstrated the supreme importance of cultivating as much as possible friendly relations with other States on the part of Great Britain, as well as the vast value of her foreign trade to herself. But if the pursuit of their paramount objects, according to their own ideas and wishes, of cultivating trade, did not appear always attainable with other nations by pacific means, the British people did not hesitate to engage in wars and plunge into the arena of battle and of strife for the purpose of ultimately forcing their rivals, if possible, to acquiesce in their views. Thus they often wrested from others territory which they acquired for their own, and traded on their own terms with the inhabitants of conquered countries that were transferred to them by the fortune of war, as the future subjects of their rule.

This was one of the principal causes of the wars of the eighteenth century, in which Great Britain so greatly triumphed, gaining for her the notable accession of numerous Colonies, which then became the guide of her Colonial policy for the government and control of her already vastly extended Colonial empire.

The loss of the American colonies consequent upon a mistaken policy on the part of the Mother Country on questions of trade left her at the end of the century in the possession of a very limited Colonial empire, consisting of the settlements on the West Coast of Africa, the three islands of Barbados, Jamaica and Newfoundland, and what was termed the insignificant province of Canada. It, however, stimulated the British people to turn their attention to new fields of colonisation; and the discoveries of Captain Cook in the southern hemisphere coinciding with that period, appeared to offer favourable inducements for Colonial expansion in that part of the world. This was the origin of the possession by Great Britain of the island continent of Australia.

Such was the condition of Great Britain and her Colonies at the commencement of the present century.

Since that period it is well known that the great expansion of the British Colonial empire has taken place in all parts of the globe, and new fields for British colonisation and enterprise have been developed by the transplanting of vast numbers of the population to her various Colonies from the British Isles. The British Empire now comprises an area of nearly ten million square miles, combining every variety of soil, climate, and powers of production of everything required for the use and necessities of the human race, so that the demand for every article which is imported from all the various foreign countries into the United Kingdom is capable of being supplied by her own

Colonies. All that is required is the adoption of a course which is really feasible for its accomplishment.

It has unfortunately been too much the policy of our legislators hitherto to regard trade with foreign countries as the most important source of commercial prosperity to Great Britain; hence the foreign trade with the United Kingdom, as compared with Colonial trade, has assumed proportions which it need not have done. The latter would have expanded to a vastly greater extent had it been fostered by more preferential treatment than it has experienced at the hands of successive British Governments. Consequent on this policy treaties have been made from time to time with various foreign countries which have been most serious obstacles to the expansion of our Colonial trade.

It would appear part of a wise Colonial policy, therefore, that these treaties should be terminated with the least possible delay. At the present time our commercial relations within the Empire cannot be regarded as conducive to those principles which ought to tend to promote a perfect federation for trade purposes, and which should eventually culminate in the permanent union of the Empire. It cannot be too emphatically pronounced that all trade is based upon the principle of barter or exchange. This being so, involves a system of mutual estimate of the value of the various articles exchanged. In the case of Great Britain and her Colonies an arrangement would have to be entered into which would apply not only to trade between the Mother Country and the Colonies, but also to the Colonies themselves trading with each other.

Having thus briefly referred to the importance of commerce in its application to British trade, an endeavour will now be made to show that the following scheme will maintain the integrity and strengthen the defence of the Empire, and that it will be permanently advantageous to the various interests whose consent would undoubtedly be requisite for its adoption.

At the outset it is of course understood that it is an essential ingredient of any scheme that it meets with the cordial approval of the Mother Country and the Colonies themselves. The trading relations of the United Kingdom with the Colonies are so vast and important, that their greater development cannot fail to be of incalculable benefit to both. The problem is how to arrange the fiscal conditions between them which would be at the same time advantageous to both parties; and if this can be carried out, no more powerful factor can be found to maintain and strengthen the unity of the Empire. The question is entirely one of give and take. The Colonies, on the one hand, must be prepared to give advantages to imports from the United Kingdom, and the Mother Country must give advantages to the products of the Colonies over those of foreign countries. A way in which this could be done would be by the

Colonies reducing their customs tariff upon the imports from Great Britain as compared with foreign countries, and by this country placing some amount of duty upon those articles of commerce which are imported from foreign countries, and admitting similar Colonial exports free of duty into this country.

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In order to provide the necessary means for carrying this into effect, a Fiscal Parliament would have to be formed, consisting of representatives of the Imperial and Colonial Parliaments, who would be entrusted with legislative and necessary administrative powers to upon the amount of the tariff, and to amend it from time to time as occasion would appear to demand. Any difficulties which might arise in the first instance would be ultimately overcome by the wisdom and sympathy of such Fiscal Parliament, which could not fail to recognise the immense advantages which must accrue to the Empire as a whole from the carrying out of a commercial federation based on such a scheme.

In order to provide for that part of the scheme which relates to strengthening the defence of the Empire, the following plan is proposed, viz. that a special duty of 2 per cent. be imposed upon foreign produce imported into the whole Empire. It is estimated that this would amount to nearly 9,000,000l., which would constitute a common fund which would be appropriated by the Fiscal Parliament as a contribution to the central Government, which at present bears almost all the entire cost, for the naval defence of the Empire. This would relieve the Colonies from the payment of subsidies, and would be supplied jointly by the Colonies and Great Britain. Besides being relieved from the payment of subsidies the Colonies would enjoy preferential treatment in the markets of the United Kingdom. Compared with the enormous advantages which this plan would bestow upon the general interests of Great Britain, the imposition of so trifling a duty would far outweigh any possible objections to its adoption. It could not fail to be a great attraction to the Colonies, and would establish a connecting link which might eventually develop into a powerful and closer bond of union between them and the Mother Country.

If such an arrangement was carried out, it would involve a change in the clause in the treaties with foreign countries which is technically known as the most favoured nation clause.'

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It would be necessary, as far as the Colonies are concerned, to provide that when treaties are entered into by Great Britain with foreign countries, that clause should not be applied to the same extent and in the same way as if the Colonies were foreign powers instead of being integral parts of the Empire itself. The policy of every foreign nation having Colonies is to favour its Colonial in preference to its foreign trade. The sole and remarkable exception to this rule has hitherto been the case of Great Britain herself.

In propounding this plan I do not aim at Protection. The idea is rather to promote a cohesive force, which shall at the same time provide a revenue which might be with the least possible difficulty rendered available for a purpose so truly national in its conception as to provide finances necessary for the defence of the whole Empire. It is doubtless in the range of possibility that if some day there should be established one uniform Imperial tariff instead of various local tariffs, it might lead to a system of Free Trade within the various parts of the Empire. Be that, however, as it may, the adoption of this plan for defensive purposes would be no obstacle to the ultimate carrying out of any such policy as is here indicated.

The part of my scheme which relates to defence is based upon one which was suggested at the Colonial Conference held in London in 1887 by Mr. Hofmeyer, one of the delegates from the Cape of Good Hope. It is so simple and comprehensive, and at the same time so practical in its character, that I do not hesitate to embody it in my scheme.

The supreme importance of the British Empire possessing a navy far more powerful than any other nation in the world, in order to maintain her supremacy at sea, cannot be over-estimated. The sea routes must be adequately protected, and the over-sea commerce thoroughly safeguarded and defended, in the interests of both the Mother Country and the Colonies. At present the cost of keeping open the trade routes falls exclusively upon the Mother Country.

The scheme proposed for defence comprehends an equitable and adequate share of contribution to this object in fair and just proportion, without unnecessary friction or insuperable difficulty between the inhabitants of Great Britain at home and her countrymen beyond the seas. Trade follows the flag, and if this plan for extending and protecting it was adopted, the commerce of the Empire would experience a powerful development, and would be enormously increased, creating fresh sources of national wealth and prosperity. I would remark in conclusion that it is not beyond the bounds of reasonable probability that the creation of the Fiscal Parliament here proposed to deal with the question of commercial federation might in the course of time lead to the ultimate attainment of the greater political expansion of the British Constitution which is known by the expressive title of Imperial Federation.

SUMMARY

1. The importance of commerce in its application to British trade.

2. The advantage of promoting the fullest possible intercourse between the various parts of the Empire, compared with the policy of