Chapter 2

I say, then, that the Tariff Reformer starts with the idea of a moderate all-round tariff. But he is not going to ride his principle to death. He is essentially practical. There are some existing duties, like those on alcoholic liquors, the high rate of which is justified for other than fiscal reasons. He sees no reason to lower these duties. On the other hand, there are some articles, such as raw cotton, which compete with no British produce, and even a slight enhancement of the price of which might materially injure our export trade. The Tariff Reformer would place these on a free list, for he feels that, however strong may be the argument for moderate all-round duties as a guiding rule, it is necessary to admit exceptions even to the best of rules, and it is part of his creed that we are bound to study the actual effect of particular duties both upon ourselves and upon others. No doubt that means hard work, an intimate acquaintance with the details of our industry and trade, an eye upon the proceedings of foreign countries. A modern tariff, if it is to be really suitable to the requirements of the nation adopting it, must be the work of experts. But is that any argument against it? Are we less competent to make a thorough study of these questions than other people, as for instance the Germans, or are we too lazy? Free Traders make fun of a scientific tariff, but why should science be excluded from the domain of fiscal policy, especially when the necessity of it is so vigorously and so justly impressed upon us in every other field? It is not only the War Office which has got to get rid of antiquated prejudices and to open its eyes to what is going on in the world. Our financial departments might reasonably be asked to do the same, and they are quite equally capable, and I have no doubt equally willing, to respond to such an appeal, instead of leaving the most thorough, the most comprehensive, and the most valuable inquiry into the effects of import duties, which has ever been made in this country, to a private agency like the Tariff Commission.

I do not think it is necessary for me to point out how a widespread tariff, besides those other advantages which I have indicated, would strengthen our hands in commercial policy. In the first place, it would at once enable us to meet the advances of the other States of the Empire, and to make the British Empire in its commercial aspect a permanent reality. To do this it would not be necessary, nor do I think it would be right, to exempt goods from the British Dominions entirely from the duties to which similar goods coming from foreign lands are subject. Our purpose would be equally well served by doing what the Colonies do, and having two scales of duty, a lower one for the products of all British States and Dependencies, a higher one for those of the outside world. The amount of this preference would be a matter of bargain to be settled by some future Imperial Conference, not foredoomed to failure, and preceded by careful preliminary investigation and negotiations. It might be twenty-five, or thirty-three, or even fifty per cent. And whatever it was, I think we should reserve the right also to give a preference, but never of the same amount, to any foreign country which was willing to give us some substantial equivalent. It need not be a general preference; it might be the removal or reduction of some particular duties. I may say I do not myself like the idea of engaging in tariff wars. I do not believe in prohibitive or penal tariffs. But I do believe in having something to give to those who treat us well, something to withhold from those who treat us badly. At present, as you are well aware, Great Britain is the one great nation which is treated with absolute disregard by foreign countries in framing their tariffs. They know that however badly they treat us they have nothing to lose by it, and so we go to the wall on every occasion.

And now, though there is a great deal more to be said, I feel I must not trespass much further on your patience. But there is one objection to Tariff Reform which is constantly made, and which is at once so untrue and so damaging, that before sitting down I should like to say a few words about it. We are told that this is an attempt to transfer the burden of a part of our taxation from the shoulders of the rich to those of the poor. If that were true, it would be fatal to Tariff Reform, and I for one would have nothing to do with it. But it is not true. There is no proposal to reduce and I believe there is no possibility of reducing, the burden which at present falls on the shoulders of the upper and middle classes in the shape of direct taxation. On the other hand, I do not believe there is much room for increasing it--though I think it can be increased in one or two directions--without consequences which the poorer classes would be the first to feel. Excise duties, which are mainly paid by those classes, are already about as high as they can be. It follows that for any increase of revenue, beyond the ordinary growth arising from increase of wealth and population, you must look, at least to a great extent, to Customs duties. And the tendency of the time is towards increased expenditure, all of it, mind you--and I do not complain of the fact--due to the effort to improve the condition of the mass of the people. It is thus no question of shifting existing burdens, it is a question of distributing the burden of new expenditure of which the mass of the people will derive the benefit. And if that new expenditure must, as I think I have shown, be met, at least in large part, by Customs duties, which method of raising these duties is more in the interest of the poorer classes--our present system, which enhances enormously the price of a few articles of universal consumption like tea and sugar and tobacco, or a tariff spread over a much greater number of articles at a much lower rate? Beyond all doubt or question the mass of the people would be better off under the latter system. Even assuming--as I will for the sake of argument, though I do not admit it--that the British consumer pays the whole of the duty on imported foreign goods competing with British goods, is it not evident that the poorer classes of the community would pay a smaller proportion of Customs duties under a tariff which included a great number of foreign manufactured articles, at present entirely free, and largely the luxuries of the rich, than they do, when Customs duties are restricted to a few articles of universal consumption?

And that is at the same time the answer to the misleading, and often dishonest, outcry about "taxing the food of the people," about the big loaf and little loaf, and all the rest of it. The construction of a sensible all-round tariff presents many difficulties, but there is one difficulty which it does not present, and that is the difficulty of so adjusting your duties that the total proportion of them falling upon the wage-earning classes shall not be increased. I for one regard such an adjustment as a postulate in any scheme of Tariff Reform. And just one other argument--and I recommend it especially to those working-class leaders who are so vehement in their denunciation of Tariff Reform. Is it of no importance to the people whom they especially claim to represent that our fiscal policy should lean so heavily in favour of the foreign and against the British producer? If they regard that as a matter of indifference, I think they will come to find in time that the mass of the working classes do not agree with them. But be that as it may, it is certain that I, for one, do not advocate Tariff Reform in the interests of the rich, but in the interests of the whole nation, and therefore necessarily of the working classes, who are the majority of the nation.

A CONSTRUCTIVE POLICY

Guildford, October 29, 1907

I am very sensible of the honour of being called on to reply for the Unionist cause, but I approach the task with some diffidence, not to say trepidation. I feel very conscious that I am not a very good specimen of a party man. It is not that I do not hold strong opinions on many public questions--in fact, that is the very trouble. My opinions are too strong to fit well into any recognised programme. I suffer from an inveterate habit, which is partly congenital, but which has been developed by years spent in the service of the Crown, of looking at public questions from other than party points of view. And I am too old to unlearn it.

For a man so constituted there is evidently only a limited _rôle_ in political life. But he may have his uses all the same, if you take him for what he is, and not for what he is not, and does not pretend to be. If he does not speak with the weight and authority of a party leader, he is at least free from the embarrassments by which a party leader is beset, and unhampered by the caution which a party leader is bound to exercise. He commits nobody but himself, and therefore he can afford to speak with a bluntness which is denied to those whose utterances commit many thousands of other people. And I am not sure whether the present moment is not one at which the unconventional treatment of public questions may not be specially useful, so, whether it be as an independent Unionist or as a friendly outsider--in whichever light you like to regard me--I venture to contribute my mite to the discussion.

Having now made my position clear, I will at once plunge _in medias res_ with a few artless observations. You hear all this grumbling which is going on just now against the Unionist leader. Well, gentlemen, a party which is in low water always does grumble at its leader. I have known this sort of thing happen over and over again in my own lifetime. And the consequence is, it is all like water on a duck's back to me; it makes no impression on me whatsoever. I remember as long back as the late sixties and early seventies the Conservative party were ceaselessly grumbling at Lord Beaconsfield, then Mr. Disraeli, right up to his greatest victory and the commencement of his longest tenure of power--almost up to the moment when he became the permanent idol of the Conservative party. I remember how the Liberals grumbled at Mr. Gladstone from 1873 and 1874 almost up to the opening of the Midlothian campaign. Again, I remember how the Conservatives grumbled at Lord Salisbury from the first moment of his accession to the leadership right up to 1885. I can recall as well as if it were yesterday a young Tory friend of mine--he has become a distinguished man since, and I am not going to give him away--telling me, who was at that time a Liberal, in the year of grace 1883 or 1884, that it was absolutely hopeless for the Tory party ever to expect to come back into power with such a leader as Lord Salisbury. He called him a "Professor." He said, "No doubt he is a very able man and an excellent speaker, but he is a man of science. He has no popular gifts whatever. There is not a ghost of a chance of a Conservative victory so long as he is in command." Yet that was not more than two years before Lord Salisbury commenced a series of Premierships which kept him, for some thirteen and a half years out of seventeen, at the helm of the State.

With all these experiences to look back upon it is really impossible for me to be much affected by the passing wave of dissatisfaction with Mr. Balfour. Men of first-rate ability and character are rare. Still rarer are men who, having those qualities, also have the knack of compelling the attention and respect even of a hostile House of Commons. When a party possesses a leader with all these gifts, it is not likely to change him in a hurry.

But if I refuse to take a gloomy view of the Unionist leadership, I must admit that I am not altogether an optimist about the immediate prospects of Unionism. There is no doubt a bright side to the picture as well as a less encouraging one. The bright side, from the party point of view, is afforded by the hopeless chaos of opinion in the ranks of our opponents--by the total absence of any clear conviction or definite line whatever in the counsels of the Government, which causes Ministers to dash wildly from measure to measure in endeavouring to satisfy first one section and then another section of their motley following, and which prevents them from ever giving really adequate attention to any one of their proposals.

I am not speaking of Ministers individually. Granted that some of them have done excellent work at the heads of their several departments--I think it would not be fair to deny that. I am thinking of their collective policy, and especially of their legislative efforts. For monuments of clumsy opportunism, commend me to the legislative failures, and, for the matter of that, to most of the legislative achievements, of the last two years.

So far so good. Unionists cannot complain of what the Government is doing for them. And on the negative side of policy--in their duty as a mere Opposition--their course is clear. It is a fundamental article of their faith to maintain the authority of the Imperial Parliament in Ireland. But that authority can be set aside by the toleration of lawlessness just as much, and in a worse way, than by the repeal of the Union. And such toleration is the rule to-day. There may be no violent crime, but there is open and widespread defiance of the law and interference with the elementary rights of law-abiding people. It is a demoralising state of affairs, and one to which no good citizen in any part of the United Kingdom, however little he may be personally affected by it, can afford to be indifferent. Once let it be granted that any popular movement, which is not strong enough to obtain an alteration of the law by regular means, can simply set the law aside in practice, and you are at the beginning of general anarchy.

Unionists have to fight for a restoration of the respect for law in Ireland in the interest of the whole kingdom. And they may have to fight also, it appears, against the abrogation of our existing constitution in favour of a system of quinquennial dictatorships. For that and nothing else is involved in the proposal to reduce the House of Lords to impotence and put nothing in its place. I am not concerned to represent the present constitution of the House of Lords as perfect. I have always been of opinion that a more representative and therefore a stronger second chamber was desirable. But that we can afford to do without any check on the House of Commons, especially since the removal of all checks upon the power of those who from time to time control the House of Commons to rush through any measures they please without the possibility of an appeal to the people--that is a proposition which no man with any knowledge of history or any respect for constitutional government can possibly defend. To resist such a proposal as that is not fighting for a party; it is not fighting for a class. It is fighting for the stability of society, for the fundamental rights of the whole nation.

I say, then, that on the negative side, in the things it is called upon to resist, the Unionist party is strong and fortunate. But are we to be content with that? Should we not all like to feel that we appealed for the confidence of the people on the merits of our own policy, and not merely on the demerits of our opponents? That, I take it, is the feeling at the bottom of what men are saying on all hands just now--that the Unionist party ought to have a constructive policy. Now, if by a constructive policy is meant a string of promises, a sort of Newcastle programme, then I can well imagine any wise statesmen, especially if they happened to be in Opposition, thinking twice before they committed themselves to it. But if by a constructive policy is meant a definite set of principles, a clear attitude to the questions which most agitate the public mind, a sympathetic grasp of popular needs, and a readiness to indicate the extent to which, and the lines on which, you think it possible and desirable to satisfy them--then I agree that the Unionist party ought to have such a policy. And I venture to say that, if it has such a policy, the fact is not yet sufficiently apparent to the popular mind, or, perhaps, I should say, speaking as one of the populace, to my mind.

Many people think that it is sufficient for the purpose--that it is possible to conduct a victorious campaign with the single watchword "Down with Socialism." Well, I am not fond of mere negatives. I do not like fighting an abstract noun. My objection to anti-Socialism as a platform is that Socialism means so many different things. On this point I agree with Mr. Asquith. I will wait to denounce Socialism till I see what form it takes. Sometimes it is synonymous with robbery, and to robbery, open or veiled, boldly stalking in the face of day or hiding itself under specious phrases, Unionists are, as a matter of course, opposed. But mere fidelity to the eighth Commandment is not a constructive policy, and Socialism is not necessarily synonymous with robbery. Correctly used, the word only signifies a particular view of the proper relation of the State to its citizens--a tendency to substitute public for private ownership, or to restrict the freedom of individual enterprise in the interests of the public. But there are some forms of property which we all admit should be public and not private, and the freedom of individual enterprise is already limited by a hundred laws. Socialism and Individualism are opposing principles, which enter in various proportions into the constitution of every civilised society; it is merely a question of degree. One community is more Socialistic than another. The same community is more Socialistic at one time than at another. This country is far more Socialistic than it was fifty years ago, and for most of the changes in that direction the Unionist and the Tory party are responsible. The Factory Acts are one instance; free education is another. The danger, as it seems to me, of the Unionist party going off on a crusade against Socialism is that in the heat of that crusade it may neglect, or appear to neglect, those social evils of which honest Socialism is striving, often, no doubt, by unwise means, to effect a cure. If the Unionist party did that, it would be unfaithful to its own best traditions from the days of "Sybil" and "Coningsby" to the present time.

The true antidote to revolutionary Socialism is practical social reform. That is no claptrap phrase--although it may sound so; there is a great historical truth behind it. The revolutionary Socialist--I call him revolutionary because he wants to alter the whole basis of society--would like to get rid of all private property, except, perhaps, our domestic pots and pans. He is averse from private enterprise. He is going absurdly too far; but what gave birth to his doctrine? The abuse of the rights of private property, the cruelty and the failure of the scramble for gain, which mark the reign of a one-sided Individualism. If we had not gone much too far in one direction, we should not have had this extravagant reaction in the other. But do not let us lose our heads in face of that reaction. While resisting the revolutionary propaganda, let us be more, and not less, strenuous in removing the causes of it.

You may think I am now talking pure Radicalism. Well, but it is not to the objects which many Radicals have at heart that we, as Unionists, need take exception. Why should we make them a present of those good objects? Old age pensions; the multiplication of small landholders--and, let me add, landowners; the resuscitation of agriculture; and, on the other hand, better housing in our crowded centres; town planning; sanitary conditions of labour; the extinction of sweating; the physical training of the people; continuation schools--these and all other measures necessary to preserve the stamina of the race and develop its intelligence and productive power--have we not as good a right to regard these as our objects, aye, and in many cases a better right, than the supporters of the Government have?

It is not these objects which we deprecate. On the contrary, they have our ardent sympathy. What we do deprecate is the spirit in which they are so often preached and pursued. No progress is going to be made--quite the contrary--by stirring up class hatred or trying to rob Peter in order to pay Paul. It is not true that you cannot benefit one class without taking from another class--still less true that by taking from one you necessarily benefit another. The national income, the sum total of all our productive activities, is capable of being enormously increased or diminished by wise or foolish policy. For it does not only depend on the amount of capital and labour. A number of far subtler factors enter into the account--science, organisation, energy, credit, confidence, the spirit in which men set about their business. The one thing which would be certain to diminish that income, and to recoil on all of us, would be that war of classes which many people seem anxious to stir up. Nothing could be more fatal to prosperity, and to the fairest hopes of social progress, than if the great body of the upper and middle classes of the community had cause to regard that progress as indissolubly associated with an attack upon themselves. And that is why, if reforms such as I have indicated are costly--as they will be costly--you must find some better way of providing for them than by merely giving another turn to the income-tax screw, or just adding so much per cent. to the estate duty.

From my point of view, social reform is a national affair. All classes benefit by it, not only those directly affected. And therefore all should contribute according to their means. I do not in any way object to the rich being made to contribute, even for purposes in which they are not directly interested. What I do object to is that the great body of the people should not contribute to them. It is thoroughly vicious in principle to divide the nation, as many of the Radical and Labour men want to divide it, into two sections--a majority which only calls the tune, and a minority which only pays the piper.

I own I am aghast at the mean opinion which many politicians seem to have of the mass of their working fellow countrymen, when they approach them with this crude sort of bribery, offering them everything for nothing, always talking to them of their claims upon the State, and never of their duties towards it. This is a democratic country. It is their State and their Empire--theirs to possess, theirs to control, but theirs also to support and to defend. And I for one have such faith in the common sense and fair-mindedness of the British people that I believe you have only to convince them that you have a really sound national policy, and they will rally to it, without having to be bought by promises of a penny off this and twopence off the other--a sort of appeal, I regret to say, which is not only confined to Radical orators, but in which Unionists also are sometimes too apt to indulge.