CHAPTER XXIV. OUR POSSIBLE GAIN FROM COLONIAL PREFERENCE.

When we deduct imports we could not send, and imports we cannot in reason hope to send, the amount of trade which we might possibly take from the foreigner is quite insignificant.

THE above, then, being the actual results of the Canadian Preference, the next consideration is as to what would be the possible gain to us from a preference system adopted by all the self-governing Colonies. What we have to do evidently is to ask how much foreign countries send into these Colonies at present, and see how much of that trade we could take from them under such a system.¹

According to the last returns, June, 1901, Canada imported from outside (exclusive of bullion and specie) goods to the value of £38,400,000. Of this, £8,829,000, or 23 per cent., came from the United Kingdom; £761,000, or 2 per cent., came from British Possessions; £28,810,000, or 75 per cent., came from Foreign Countries.

What we may possibly gain is some of the trade represented by the £28,810,000. But, from this possibility we must deduct:—

(1) Goods which Great Britain does not grow or make, such as Sugar, £1.6 millions; Maize, £1.3 millions; Raw Cotton and Cotton Wool, £981,000; Tea, £463,000; Rubber, £363,000; Tobacco, £349,000; Green Fruit, £347,000; Dried Fruits, £256,000, etc., etc. Such goods make up a total of £6,273,000 of imports into Canada which we could not take from the foreigner.

(2) Many goods we do grow or make, but could not, in reason, hope to supply Canada with—they are almost all United States products–such as Coal and Coal dust, £2,737,000; Wheat, £1,309,000; Wood, £687,000; Oats, £195,000; Bacon and Hams, £149,000; Coke, £140,000; Horses, £125,000; Cheese, £125,000; Pork, £94,000, etc., etc. These make up a total of £6,583,000.

Deducting these two items, there is left £16 millions of imports into Canada which we might possibly take from foreign nations and secure for our own producers. But we have had a Preference since 1897, and we are further away from getting any of it than ever. What new inducement is there for our exporters to do any more than they are doing? Or what new inducement is there for the Canadian consumer to demand that these goods be British-made and not foreign-made?

But, on looking into the details of the £16 millions, we find something more that makes the possibility still less of a probability. It is that these foreign imports are scattered over some seventy categories of different goods, only one of them amounting to over a million. Is it to be expected that seventy different trades, without any new motive, will show enough new energy and enterprise to wrest these imports from the foreigner?

Pursuing the same line of investigation as regards the other self-governing Colonies, we get the following results:

Cape Colony, in 1900, imported from outside £17,163,000. Of this, £11,053,000, or 64½ per cent., came from the United Kingdom; £2,478,000, or 14½ per cent., came from British Possessions; £3,632,000, or 21 per cent., came from Foreign Countries. The possible gain of trade for us is £2,092,000, spread over some forty categories, only five of them over £100,000.

New Zealand, in 1900, imported from outside £10,208,000. Of this, £6,453,000, or 63 per cent., came from the United Kingdom; £2,239,000, or 22 per cent., came from British Possessions; £1,516,000, or 15 per cent., came from Foreign Countries. The possible gain is £1,276,000, spread over some forty-five categories, only three of them over £60,000.

Australia, in 1900, imported from outside £40,188,000. Of this, £25,113,000, or 63 per cent., came from the United Kingdom; £3,728,000, or 9 per cent, came from British Possessions; £11,347,000, or 28 per cent, came from Foreign Countries. The possible gain is £8,007,000, spread over some seventy categories, only five of them over £250,000.

Natal, in 1900, imported from outside £5,912,000. Of this, £3,726,000, or 63 per cent, came from the United Kingdom; £1,147,000, or 19 per cent., came from British Possessions; £1,039,000, or 18 per cent, came from Foreign Countries. The possible gain is £539,000, spread over twenty categories, only two of them over £60,000.

Newfoundland, in 1900, imported from outside £1,512,000. Of this, £458,000, or 30 per cent., came from the United Kingdom; £582,000, or 39 per cent., came from British Possessions; £472,000, or 31 per cent., came from Foreign Countries. The possible gain is £220,000, spread over twenty categories, only two of them over £20,000.

That is the magnificent total possibility; the limit of our possible extension of trade if we could secure the whole of the Colonial imports which foreign countries now send.¹ If we deduct the Canadian £16 millions on which we have a Preference, there remain £12 millions which we might possibly take from the foreigner by the extension of the preference system over all our Colonies. But the probability, of course, is ever so much less. In this list are numbers of things that the Colonies will not take from us, even if they are cheaper than competing goods from other countries: we have seen how it is with Canada—that what determines an import is not so much cheapness as a demand for a special quality or style of article.² We should be well off if we gained a quarter of the £12 millions.

If this possible but extremely improbable increase of trade were the sole ground for overturning our Free Trade system, and establishing tariffs against countries which send us some three-fourths of the goods we import, then one would be inclined to say that nothing so reckless and ill-judged had ever been proposed in the British Parliament.³

But, it may be asked, what about the future? £28,000,000 is a small sum, but the Colonies are a growing market. Think, it is said, of what they will buy when their white people have increased from eleven millions to forty millions.¹

Is this to be taken seriously? Is it not notorious that Canada, though an agricultural country, and therefore, presumably, a country where population grows fast, is not “holding her own population,” but grows from outside?² In the five years from 1897 to 1902, the total population has increased from 5,141,508 to 5,456,931, or under 8 per cent.—not very much more rapidly than our own. At the census of 1901, the rate of increase was found to be less than it had been in 1891. The birth rate and the number of persons to a family are both decreasing. And is it not a fact bitterly commented on that the “natural increase” of Australasia, like that of France, is arrested?³

But, of course, increase of trade does not depend altogether on increase of population; trade increases also with growing wealth. A family of five may buy as much as a family of ten, if it is twice as rich. Think, then, it may be urged, of the importance of securing this increase of purchasing power.

But, under present circumstances, we have secured the large proportion of the purchasing power in five out of the six Colonies. In Australia, New Zealand, and Natal, we have 63 per cent, of the import trade; in Cape Colony, 64½ per cent.; and that without Preference. Only in the one Colony which gives us a preference is the proportion the other way about—23 per cent. British to 75 per cent, foreign—and the proportion is falling.

If, then, all that Canada’s Preference has done for us is to secure a small and a diminishing proportion of Canada’s imports, and if, without Preference, we have already the larger proportion of the imports of the other five Colonies, is it common sense to ask us to become protectionist in the hope that we may secure a still larger proportion? What guarantee or hope have we that, under Preference, the five Colonies will serve us any better than Canada has done?

But, if they do not, the argument for Preference goes by the board.

¹ The details which follow are taken from the Board of Trade Blue Book, p. 381.

¹ It is perhaps unnecessary to remind the reader that this sum of £28,000,000 is possible trade, not possible profit.

² The New Zealand Premier unconsciously testifies to this, in the details of his new scheme of Preference. Foreign goods are to be surtaxed; but that he does not in the least anticipate that the surtax will exclude them, is evident from his estimate that he will raise £70,000 or £80,000 on imports that amounted last year to only £313,000.

³”The foreign trade of this country is so large, and the foreign trade of the Colonies is comparatively so small, that a small preference given to us upon that foreign trade would make so trifling a difference—would be so small a benefit to the total volume of our trade—that I do not believe the working classes of this country would consent to make a revolutionary change for what they would think to be an infinitesimal gain.”—Mr. Chamberlain, 9th June, 1896.

¹ “How long are we going to be four times as many as our kinsfolk abroad.” . . . “It seems to me to be not at all an impossible assumption that, before the end of this half century, we may find that our fellow subjects beyond the seas may be more numerous than we are at home.”—Mr. Chamberlain at Birmingham, May 15, 1903.

² In the year ending June 30th, 1902, the total immigrants numbered 64,634. Of these, 24,000 came from the United States.

³ Mr. Coghlan, the Government Statistician for New South Wales, reports in 1903: “Present indications give no hope of a teeming population springing from Australasian parents, for the birth rate in all the States has declined very greatly, especially during the last fifteen years, and, when compared with the total population, the births in three of them are proportionately less numerous than in any European country, France alone excepted.”