The Online Library of Liberty

A project of Liberty Fund, Inc.

• Preface
• Introduction
• Part I: England, Ireland, and America 1835
• I.—: England
• II.—: England
• III.—: America
• Part II: The Corn Laws and Free Trade
• I.—: The Petition of the Merchants (1820)
• II.—: Joseph Hume’s Speech On the Corn Laws, May 17, 1833
• III.—: The Manchester Petition Against the Corn Laws (1838)
• IV.—: Repeal of the Corn Laws
• V.—: Repeal of the Corn Laws
• VI.—: The Corn Laws and Compromise
• VII.—: The Impending Scarcity
• VIII.—: ;the Repeal of the Corn Laws
• IX.—: The League and Sir Robert Peel
• X.: —after Repeal—the League Dissolves
• XI.—: Free Trade and Reduction of Armaments
• XII.—: The Taxes On Knowledge
• Part III: Wars and Armaments
• I.—: Armaments, Retrenchment, and Financial Reform
• II.—: An International Reduction of Navies
• III.—: On the Crimean War and the Patriotism of Its Opponents
• IV.—: The French Treaty and Armaments.
• V.—: The Civil War In America
• VI.—: The Civil War In America
• Part IV: Colonial and Fiscal Policy
• I.—: The Relation of Foreign and Colonial Policy to Fiscal Reform
• II.—: Colonial Expenditure and Government In 1848
• III.—: The Prussian Zollverein In 1840 By Richard Cobden
• IV.—: On the Proposed British Zollverein, Or Commercial Union With the Colonies
• Part V: Social Reform
• I.—: Cobden On Education
• II.—: The End and Aim of Politics
• III.—: The Malt Tax, Temperance, and Retrenchment
• IV.—: Wages and Cheap Food
• V.—: To Farm Labourers On Agricultural Policy

PART IV

COLONIAL AND FISCAL POLICY

COLONIAL AND FISCAL POLICY

‘What is the reason,’ asked Cobden once when he was discussing the fiscal relations of Ireland to Great Britain ‘why no statesman has ever dreamt of proposing that the colonies shall sit with the mother country in a common Legislature?’ His answer goes to the root of the matter. ‘It is not because of the space between them, for, nowadays, travelling was almost as quick as thought; but because the colonies, not paying Imperial taxation, and not being liable for our debt, cannot be allowed with safety to us, or with propriety to themselves, to legislate on matters of taxation in which they are not themselves concerned.’ If representatives from the colonies were allowed to sit in the House of Commons ‘an ambitious and unscrupulous minister would be sure to make use of them for the purpose of oppressing the English people.’ Such a minister, observed Cobden, might say to the Canadian representatives, ‘Help me in such a case, and I'll help you to prevent England from putting a tax on Canada.’ In short, Imperial federation would mean irresponsible government. The object of the Manchester School was not an empire but a commonwealth of autonomous communities. If you have to choose between self-government and good government choose self-government. But that uncomfortable choice has never presented itself in the case of a real colony. The rule of Downing Street over distant communities of European race has always been unsatisfactory to the colony and costly to the mother country, not seldom oppressive, sometimes provocative of war and disastrous to civilization. In 1877 Mr. Bright was asked what he thought of the protective policy of Victoria. In the course of a letter which breathes throughout the spirit of political toleration he made some observations which false exponents of the Manchester School should lay to heart: ‘If a Government voted a sum of money to support a steamboat enterprise which was deemed of great service to the country, but which from its novelty or its risk private capitalists would not undertake, I should say that in doing this no sound principle would be broken, and that the public interest might possibly be wisely served. So if a Government thought that if a new culture might be introduced into the country, such as the grape or tea, it might appropriate a sum of money to make that experiment, leaving its future progress or fate entirely to the industry and disposition of the people.’ Here is one of the leaders of the Manchester School perfectly ready to admit the propriety of Government enterprise in certain cases. Does this involve a weakening in doctrine? Let us continue the quotation: ‘But to enact a tariff imposing heavy duties on most important articles of comfort, to establish an oppressive and costly system of custom-houses, to build up special interests before their time, or industries which might never thrive in the free air of competition, at the expense of taxation upon the whole people, levied partly at the custom-houses, and partly by the high prices which are sought to be obtained on the home-made and protected article, is a policy so unsound and so injurious that I am greatly surprised that any one in the least acquainted with me or with my life should have supposed it possible that I should have given it my support.

‘Englishmen form colonies at a distance from the mother country. They throw off many of the superstitions which are still to a large extent cherished in England. In respect of protection by means of a prohibitive or restrictive tariff, the colony of Victoria clings to a superstition or error which we in England have abandoned. Our experience is conclusive as to the wisdom of our policy. Victoria is young, and thinks she knows more and better than we know. But when she finds herself, not at the head, but at the tail of the great Australian communities as to her success and the growth of wealth, she may discover that industry has no greater enemy than a protective or restrictive tariff.’1

One of the principal objects of colonial emancipation was to get rid of the cost of military and civil establishments in our distant possessions and so to free large sums of money for fiscal and social reform at home. Experience had shown that governors armed with large powers are a constant source of danger and expense. The colonial system was a system of political and fiscal bondage. Imperial tariffs as well as imperial governors were maintained by soldiers and ships of war. In the speech of Sir William Molesworth the character and cost of the old system, to which we are now invited to return, will be found very faithfully depicted. As we have already seen, Molesworth's speech was endorsed by Cobden, and no student of English history during the second half of the nineteenth century will deny that the policy outlined in the speech, and in the letter which precedes it, was carried out with extraordinary fidelity by successive parliaments. The two extracts dealing with the German Zollverein, and with the proposals for a British Customs Union, complete our view of the colonial policy of the Manchester School.

I.—

THE RELATION OF FOREIGN AND COLONIAL POLICY TO FISCAL REFORM

The following letter was written by Cobden to Robertson Gladstone (W. E. Gladstone's younger brother), who was then doing admirable work as president of the Financial Reform Association. The letter is dated London, 103, Westbourne Terrace, 18^th December, 1848. Within a little more than a generation the whole of Cobden's ‘National Budget’ was adopted.

Dear Sir,—I gathered from the conversation I had with you and the members of the Financial Reform Association in Liverpool, that you have two objects in view. First, the substitution of direct for indirect taxation; and secondly, a diminution of the present amount of Government expenditure. I ventured to offer an opinion, which I now beg to repeat, that it would be far easier to effect a reduction of expenditureSuggestions for a national budget.to the extent of £10,000,000 and apply the whole of that sum to the removal of Excise and Customs duties, than to transfer the same amount from indirect to direct taxation. Excepting in Liverpool and a few of our largest trading towns, there is not, at present, a very great force of public opinion in favour of direct taxation. It has yet to be created and organized. But there is a very general sympathy felt in the proceedings of your body, founded upon a strong desire to have the burthens of taxation lightened; and there is some expectation that you will put forth a plan for effecting that object. My reason for now troubling you is, to suggest whether it might not be advisable to publish a national budget, exhibiting on one side a considerable reduction in the expenditure, and on the other the several Excise and Customs duties which you propose, in the first place, to abolish. I do not mean by this, a perfect financial scheme, such as may be contemplated as the ulterior object of your Association, but a plan which, whilst it went in the direction of your principle of direct taxation, and relieved the mass of consumers from a heavy tax upon their necessaries and comforts, should commit those politicians of all shades who now join in the vague cry for ‘economy and retrenchment’ to some practical measure worth contending for.

I suggest that you take for the basis of your budget the expenditure of 1835. The whole cost of the Government in that year, including interest of debt, was £44,422,000. For the twelve months ending the 5^th April last, it amounted to £55,175,000, being an increase of £10,753,000. The interest of the debt was less by £87,000 in the latter than the former year, making the comparison so much the more unfavourable to 1848. The estimated expenditure for the current year ending the 5^th April, 1849 (see Lord John Russell's speech 18^th February last), is £54,596,000; so that we may take the increase to be, in round numbers, £10,000,000 since 1835. Do you see any good reasons why we should not return to the expenditure of that year? Englishmen love precedents; and they are not easily persuaded that anything is Utopian or impracticable which has been accomplished within the last thirteen years; and this is one reason, though I will find you a better, why you should base your budget upon that of 1835. If we go back a little further, to the time when this nation was still under the rule of the boroughmongers, we shall find a startling argument in favour of this plan. In 1830, the last year of the Wellington-Peel administration, the expenditure for all purposes exclusive of the interest of the debt, was £18,024,000; for the twelve months ending the 5^th April of the present year, it amounted to £26,747,000. The Tory Government was overturned the following year, upon the motion of Sir Henry Parnell, in favour of economy, and the House was soon after reformed, merely on the plea of its profligate waste of the people's money; and yet we have now an increase to the expenditure of £8,723,000, or nearly 50 per cent. as the fruits of the Reform Act. We are now actually expending more upon the Army, Navy, and Ordnance alone than was sufficient for the maintenance of the whole civil and military establishments under the Duke of Wellington's Government! When these facts shall be generally known, the country will, I think, be in the humour for responding to your appeal, if you inscribe as the motto upon your banner, ‘The Expenditure of 1835;’ which will be a reduction of £10,000,000 from this year's budget.

I would not advise you to complicate your plan by proposing any new imposts to rouse the antagonism of interested parties, or any modifications or substitutions of existing taxes, to destroy that simplicity of object which, above all things, is necessary to the success of a public agitation. But there is one tax from which the dominant class in this country has exempted itself for half a century, which exemption it would be disgraceful to the character of the British people any longer to tolerate—I mean the probate and legacy duty. In the last year upwards of two millions was paid into the exchequer by the heirs to personal property, consisting mainly of the hard-earned accumulations of our merchants, manufacturers, professional men, traders, and mechanics; whilst the ducal domain, or the estate of the great landed proprietor, passed untaxed from the dead to the living. This year will be memorable for having witnessed the destruction of the last remaining powers of feudalism in all the countries of the Continent, excepting Russia. But I know of no privilege which the nobles of Prussia, Gallicia, or Hungary have been compelled to surrender, as a tribute to the enlightenment of this age, more unjust in principle than that which is conferred upon our landed proprietors in the statute passed by themselves, imposing duties exclusively upon the inheritance of personal property. Let us not boast of English freedom, or of equality before the law, whilst this injustice remains. In what form could aristocratic privilege assume a more offensive and costly aspect than in that of a bold and palpable exemption from taxation? I do not think that great resistance will be offered to the equitable adjustment of this tax, provided the people speak out as becomes them. No living proprietor will be affected by the change; and the landowners are as conscious as you or I that these are not times for transmitting such a class privilege to posterity. I assume that the probate and legacy duty upon real estate, entailed and unentailed, will yield, at a moderate estimate, £1,500,000. By the above plan you would have a disposable surplus revenue of £11,500,000—viz. ten millions from the reduction of expenditure, and a million and a half from the increased produce of the probate and legacy duty.

I will now trouble you with my views as to the disposal of that amount; premising that I have not felt quite free to choose in every instance those items of the Customs and Excise duties, which I should myself have preferred to abolish or reduce, but have been partly influenced by the desire to enlist the sympathy and support of every class and interest in the community, whose co-operation will be abundantly requisite to force the adoption of the plan upon the Government.

To begin with the Customs duties. The present duty of 2s. 2d. a pound upon tea, whether viewed as a tax upon the most harmless stimulant enjoyed by the people, or as an impediment to the operations of our merchants trading with China, is one of the most indefensible in the tariff. I would reduce the duty to 1s. a pound, or an ad-valorem duty yielding the same amount of revenue, by which, according to the estimate of the Chancellor of the Exchequer, in his speech on Mr. Cardwell's motion, there would be a loss for the first year of £2,000,000. The duty on timber and wood must be wholly abolished. This is a necessary consequence, if not an accompaniment of the repeal of the navigation laws. The amount is £945,000. (I have taken this and all the following items from the finance accounts for the year ending January 5^th, 1848, deducting the expense of collection.) I propose, also, to take the duty off butter, cheese, and upwards of one hundred items of the Customs duties, yielding altogether £516,000; and leaving only about twenty articles in the tariff paying duty.

These three sums amount to £3,461,000.

Next, with reference to the Excise. It may be laid down as a rule, that whenever you touch an Excise duty at all, it should be totally abolished; because the great objection to such taxes—the interference of the exciseman with the process of production—applies equally whether the duty be great or small. This should be borne in mind if you deal with the malt tax; and you must deal with it, if you would enlist the sympathy of the county constituencies in your movement. To a man, the farmers are in favour of the repeal of the malt tax; and this not merely because it would add to the contentment of the peasantry, by cheapening a beverageExcisewhich they universally consume, and also relieve their employers from a heavy tax upon the beer which they give to their labourers at certain seasons, but the best agriculturists loudly protest against the duty, on the plea that it denies them the free application of their capital to the fattening of cattle upon malt, and thus prevents the profitable growth of barley upon stiff clay lands. Upon this subject Mr. Lattimore, speaking for an influential deputation of landlords and farmers, which had an interview with Lord John Russell in February last, said, ‘The malt tax disarranged the best modes of cultivation, enhanced the price of artificial food for stock and cattle, whereby the fertility of the soil was deteriorated, the demand for labour lessened, the supply of bread-corn and animal food considerably decreased, and the comforts of the people and the wealth of the country were also greatly impaired.’ Your ‘National Budget’ would, therefore, be undeserving the name if it did not include the total repeal of the malt tax, amounting to £4,260,000.

In Kent, Sussex, and two or three other counties, there is an active agitation against the hop duty. The expense of collecting this tax is alone sufficient to condemn it. Nothing could so well exemplify the wasteful and costly process of collecting revenue by means of excise duties as the spectacle exhibited, for a month or six weeks every autumn, of a little army of excisemen dispersing themselves over half a score of counties, to levy a tax in the fields and gardens of the hopplanters. I question if anything more barbarous could be met with in Turkey, or any uncivilized country, where political economy had never been heard of even by name. I propose, therefore, the abolition of the hop duty, amounting to £416,000. By including the malt and hop duties you will insure the co-operation of the farmers, who, now that free trade is the settled principle of our legislation, have a common interest with the inhabitants of the towns. The landlords, too (at least such of them as are not merely professional politicians), will henceforth be found in the front ranks of those who advocate economy and retrenchment in the national expenditure. Already they have begun to ask, and with good reason—Why should we not have cheap government as well as cheap corn?

Next is the article of soap. What a satire upon our sanitary acts, and all the pompous agitations in favour of baths and wash-houses, is this tax upon the necessary elements of cleanliness! Not a word need be said upon it. The duty, amounting to £850,000, must come off, if it be only to cleanse us from the stain of national hypocrisy. That which soap is to the skin, literature is to the healthy action of the mind, and yet we raise £720,000 a year from a heavy duty upon paper. By including this in your budget, you will promote the religious, moral, and intellectual advancement of the people, in a manner acceptable to all parties, whatever may be their views upon the subject of national education. The last two items will draw towards you the sympathies of the Scotch Excise Reformers.

These four sums amount to £6,246,000.c

Lastly, I come to taxes, properly so called. There is the window tax, which, although it does not, like the Excise duties, operate as a direct impediment to productive industry, is open to the fearful objection, that it ‘obstructs the light of heaven;’ and, in these brief words, we may read its inevitable doom. London, Bath, and other large cities are pressing the abolition of this tax annually upon the House, through Lord Duncan, and you must not think of excluding it from your ‘National Budget.’ It yields £1,610,000. My ‘way and means’ are so nearly exhausted, that I can only add the advertisement duty, amounting to £160,000.

These two sums amount to £1,770,000. The total loss of revenue by the reduction of the above duties and taxes is £11,477,000, or £23,000 less than the £11,500,000 of surplus which I propose to create, by the diminution of expenditure, and the equalization of the probate and legacy duty. I subjoin a summary of the foregoing, in a concise tabular form:—

I repeat that I do not propose this as a complete financial scheme. Many articles are omitted which I should not wish to be considered to have willingly excluded, or be thought to have overlooked. I have gone again and again through the dismal catalogue of our fiscal burdens, and if there be any item of the Customs or Excise duties which you are sorry to miss from the above table, be assured that the omission has caused me equal regret. Bricks ought especially to stand one of the first on the list for a prospective budget. Tobacco is a very strong case, but it involves so large an amount of revenue that I could not include it. The wine duties also call for a revision; not to name others. Then there are some duties and taxes, the modification of which does not necessarily involve a loss of revenue, and which may be dealt with independently of the present plan. The duties on foreign and colonial coffee ought to be forth-with equalized; the property and income tax should be revised, and a just discrimination made between fixed and precarious incomes. For the stamp upon newspapers, a stamped envelope might be substituted, bearing upon those only which are transmitted by post; and the stamp duties, generally, call loudly for an equitable revision. I mention these examples to show, that, by adopting the proposed ‘National Budget,’ you would not be precluded from effecting other financial reforms. On the contrary, I believe if the industry of the country were further disburthened to the extent I have named, there would be an accruing surplus revenue from the remaining sources of taxation, which would afford the means of continually making further modifications and reductions of duties. This would have been the case in times past, notwithstanding all the restrictions upon our commerce, if the increasing income had not been swallowed up by Government extravagance. For instance—had not the expenditure been increased since the time of the Duke of Wellington's administration, in 1830, then, notwithstanding the very large amount of taxes and duties since remitted, there would now have been a surplus revenue without the income tax.

A word or two as to the mode by which I would reduce our expenditure to the amount of 1835. The great increase,Military expenditure.since that year, has been upon the army, navy, and ordnance. In the year 1835 our armaments cost us £11,657,000; for the twelve months ended on the 5^th day of April last, they reached, including £1,100,000 for the Kaffir war, £19,341,000; and I expect that the charge for the present year will not be much less. For the same time, the total expenditure of the Government, exclusive of the interest of the debt, was £26,747,000, and deducting £19,341,000, the cost of our warlike establishments, it leaves only £7,406,000 to cover the whole of the civil expenses of the Government. It will be self-evident, then, that if any material retrenchment be effected, it must be mainly upon our armaments, the cost of which has been increased £7,000,000; and this during a period of profound peace, and in the absence of all revolutionary convulsions, and while each successive speech from the Throne assured the assembled Parliament of the pacific disposition of all foreign powers. But if we take into calculation the present reduced value of commodities, it will be found that £10,000,000 expended upon our armaments now will go much further than £11,657,000 did in 1835; and I suggest that you propose the former sum as the maximum expenditure for the army, navy, and ordnance, by which you will gain about £8,500,000 of the proposed saving of £10,000,000. I by no means, however, wish to committ your Association to ten millions, as the minimum cost of our armaments, for I have a strong belief that you will live to see the waste reduced to less than half that sum. The above-named amount will be three times as great as that of the United States; greater than that incurred for the same purpose by Russia, Austria, or Prussia; and, judging by her promised reductions, nearly, if not quite, as large as that of France.

The remaining £1,500,000, to complete the proposed reduction of £10,000,000, you will have little difficulty in saving from all the other heads of expenditure, including the cost of collecting the revenue, and the management of the Crown lands.

I repeat, emphatically, all hope of any material relief from taxation hinges upon the question of a large reduction in the cost of our army, navy, and ordnance. If it be objected that I do not specify the particular regiments or ships which I propose to reduce, my answer is, that the only way in which the public can restrict the Government at all, in its warlike expenditure at a time of peace, is by limiting the amount of money. Disband a regiment, or pay off a ship to-day, and the amount saved may be spent to-morrow upon steambasins, or for fresh fortifications at Gibraltar, Labuan, or Hong Kong. This was the view entertained by Sir Henry Parnell, a great Whig authority, who, in his work upon Financial Reform, written when the Duke of Wellington was at the head of affairs, whilst arguing for a reduction in the expenditure of our military department, says: ‘Fix upon a much smaller sum, and tell them that they must make it answer.’ There is another good reason for this course. Some influential persons, who are opposed to any diminution of the strength of our armaments, yet contend that the present force may be kept up at a very reduced cost. In their eyes, your maximum sum represents a much larger force than you contemplate. These parties, probably, would be as willing as myself to put an end to the crimes and cruelties imported into the slave trade by the interference of our costly fleet of cruisers upon the African coast; or there may be other savings contemplated by them; so that, perhaps, in their opinion, with an expenditure of ten millions, nearly as large an effective force as at present may be maintained.

But I am prepared to contend for changes in our foreign, colonial, and domestic policy (though I will not attempt to do so at length now), calculated to facilitate a reductionNon-interference. in the amount of our armaments. First and foremost, we must insist that the principle of non-interference in the affairs of foreign countries, so loudly professed by politicians of all parties, shall be carried into practice in the policy of our Government. During the whole of last year, a fleet, as formidable as that required by the Americans to watch over their commerce in all parts of the globe, was maintained in the Tagus, out of the taxes of the British people, for the service of the Court and Government of Portugal. At this moment we have as large a fleet in the Straits of Messina, engaged in an armed interference between the King of Naples and his Sicilian subjects, with no more interest or right on our part than the Government of the United States would have to send a squadron off Holyhead, and assume the character of an armed mediator between England and Ireland. For three or four years we have had a fleet in the River Plate, interfering in the endless and inexplicable squabbles of the Monte Videans and Buenos Ayreans, and it has at last ended in a ridiculous failure. I would wish to see our Government spare the people this useless expense, by simply following the rule observed by individuals, of leaving other nations to settle their quarrels, and minding its own business better.

I am also aware, that any great reduction in our military establishments must depend upon a complete change in ourThe colonies.colonial system; and I consider such a change to be the necessary consequence of our recent commercial policy. I am prepared to carry out, logically, the principle of free trade in our future relationship with our colonies. Nay, more. I always contemplated that the practical application of that principle would so simplify the question, that it would not be possible afterwards to continue the ruinous colonial expenditure which we have hitherto sustained. So long as protection was our ruling policy, the nation believed that the exclusive trade with our colonies compensated us for the expense of governing and guarding them. I did not, of course, share in that opinion, but there was consistency, if not wisdom, in those who did. But we have now declared that, for all commercial purposes, they shall in future stand in precisely the same relationship towards us as foreign countries. For seventy years we have denied ourselves the right, by statute, to tax them for imperial purposes. Under these altered circumstances, will anybody be found, even amongst the Protectionists, ay, even Lord Stanhope himself, who is prepared to maintain that henceforth the only exclusive connexion we are to preserve with our colonies is the monopoly of the expense of governing and garrisoning them? Once let them see that free trade is the irrevocable policy of the country, and the Protectionists themselves will join with me in demanding an exemption from the expense of the thirty or forty little armies, which (exclusive of the troops in the merely military fortresses of Gibraltar, etc.) are maintained at the cost of this country in all parts of the globe; together with the little army always afloat, for the purpose, incredible as such folly may hereafter appear, of transporting reliefs of soldiers from England to serve as policemen for Englishmen at the antipodes! We have only to give to the colonists that which is their birthright—the control over their expenditure, and the administration of their own local affairs, and they will be willing, as they are perfectly able, to bear all the cost of their own civil and military establishments.

And, finally, I contend that we must endeavour to act at home more in accordance with the good old constitutional principle of governing by the civil and not the military power. We are, I fear, tending towards too great a reliance upon soldiers, and too little on measures calculated to insure the contentment of the great body of the people. It were madness indeed to think of relying upon bayonets for the permanent support of our institutions, after the warning examples afforded by so many countries on the Continent, where, so lately, we saw military despotism crumbling beneath the weight of its own intolerable costliness: and even if armed authority have everywhere resumed its sway, has that solved the problem of their financial embarrassments? On the contrary, they have only entered again upon the more vicious circle, where enormous armaments lead to increased expenditure, to be met with augmented taxes, which will be followed by groaning discontent, and end, as before, in convulsion.

I cannot conclude without tendering you and your fellow-labourers my best thanks. By your efforts to mitigate the pressure of unjust taxation, to remove all obstacles from the path of industry, and to widen the channels of foreign commerce, you are doing that which, more than armed regiments, will contribute to the stability of our institutions and the peace and prosperity of the country. It will be gratifying to me if, in this too long letter, I have succeeded in rendering the slightest service to the cause in which you are embarked. My sole object has been to give a practical aim to your valuable efforts, so that at every step you take you may find yourselves nearer to a defined object, the attainment of which shall be some recompense for the labours of an agitation which I trust will become national.

I remain, dear sir, faithfully yours,

Richard Cobden.

II.—

COLONIAL EXPENDITURE AND GOVERNMENT IN 1848

The following speech was delivered by Sir Wm. Molesworth, in the House of Commons, on July 25^th, 1848. It was circulated at the time by the Financial Reform Association, and was justly described as ‘a complete and searching exposure of colonial administration.’

Sir,—In submitting to the consideration of the House the motion of which I have given notice, I must entreat the indulgence of the House; for the nature and extent of the subject will compel me to trespass at some length upon its patience. My object is, in the first instance, to call the attention of the House to the amount of the colonial expenditure of the British empire; and in so doing, I shall endeavour to establish the following positions: 1^st, That the colonial expenditure can be diminished without detriment to the interests of the empire; 2^nd, That the system of colonial policy and government can be so amended, as to ensure more economical, and altogether better, government for the colonies. And lastly, that by these reforms the resources of the colonies would be developed, they would become more useful, and their inhabitants more attached to the British empire.

In speaking of colonies, I do not intend to include under that term the territories which are governed by the East India Company, but shall confine my remarks to those foreign possessions of the Crown which are under the jurisdiction of the Colonial Office. Notwithstanding this limitation, the colonial empire of Great Britain contains between four and five millions of square miles—an area equal to the whole of Europe and British India added together. Of this vast space about one million of square miles have been divided into forty different colonies, each with a separate government:Definition of terms.four of them are in Europe, five in North America, fifteen in the West Indies, three in South America, five in Africa and its vicinity, three among the Asiatic islands, and five in Australia and New Zealand. The population of these colonies does not exceed 5,000,000; of this number about 2,500,000 are of the European race, of whom about 500,000 are French, about 350,000 are Ionians and Maltese, a few are Dutch or Spaniards, and the remainder, amounting to about 1,600,000, are of English, Irish, or Scotch descent. Of the 2,500,000 inhabitants of the colonies who are not of European race, about 1,400,000 are Cingalese, and other inhabitants of Ceylon, and 1,100,000 are of African origin. In 1844 (the last complete return) the declared value of British produce and manufactures exported to the colonies, amounted to about £9,000,000 sterling. The whole colonial expenditure of the British empire is about £8,000,000 sterling a year; one half of which is defrayed by the colonies, and one half by Great Britain. That portion of the colonial expenditure which is defrayed by Great Britain, consists of military, naval, civil, and extraordinary expenditure.

Firstly, the net military expenditure by Great Britain, on account of the colonies (including ordnance and commissariat expenditure), was returned to Parliament, for the year 1832, at £1,761,505; for the year 1835–36, at £2,030,059; and for the year 1843–44 (the last return), at £2,556,919, an increase between 1832 and 1843 of £795,414. The presentMilitary expenditure on colonies.military expenditure is probably about the same as it was in 1843–44; for the military force in the colonies amounts at present to about 42,000 men (exclusive of artillery and engineers), or to about three-eighths of the whole military force of the British empire (exclusive of the army in India). For this amount of force we shall have to vote this year, first, in the army estimates for the pay, clothing, etc., of 42,000 men, and for the foreign staff, about £1,500,000; secondly, in the ordnance estimates for the pay of the artillery and engineers (which I will suppose to be the same as in 1843–44), for ordnance establishments, barracks, fortifications, and stores in the colonies, about £500,000; and thirdly, in the commissariat estimates for commissariat services, provisions, forage, fuel, light, etc., in the colonies, about £450,000: in all, about £2,500,000, which will be the direct military expenditure by Great Britain, on account of the colonies, for this year. To form a fair estimate of the whole military expenditure by Great Britain on account of the colonies, for one year, it would be necessary to add to this sum of £2,500,000, a very considerable sum, on account of reliefs, military establishments at home, and other matters, which are in part required in order to keep up so large a military force in the colonies. It is evident, therefore, that I shall underestimate the military expenditure by Great Britain, on account of the colonies, when I set it down at only £2,500,000 a year.

Secondly, with regard to the naval expenditure by Great Britain on account of the colonies. At present we have about 235 ships in commission, with a complement not much short of 40,000 men. Of these ships, about 132, with a complement of about 25,000 men, are on foreign stations: some in the Mediterranean, some on the North American and West Indian station, some off the west coast of Africa and the Cape of Good Hope, others in the Chinese and Indian seas, or protecting our interests in New Zealand. Now, the House will remember that, in every debate that has taken place this year on the estimates, the extent of our colonial empire, and the new colonies which are springing up in Australia, New Zealand, and the Chinese and Indian seas, were among the chief causes assigned by the nobleNaval expenditure on colonies. lord the member for the City of London, and the honourable gentleman the member for Sheffield, for the enormous amount of the naval force of Great Britain, and for the increase of that force, which has doubled both in magnitude and cost during the last thirteen or fourteen years. I may, therefore, without exaggeration, assume that at least one-third of the ships on foreign stations—that is, one-fifth of the ships in commission—or 45 ships, with a complement of about 8000 men, are maintained on account of the colonies. Now, I infer from the estimates, and from the returns presented to the House, that these ships will cost the country annually, for wages and victuals of crews, wear and tear of vessels and stores, more than £700,000. In addition to this sum, we shall have to vote this year, in the navy estimates, £65,000 for naval establishments in the colonies, another £65,000 for naval works and repairs in the colonies, and £181,000 for freight and other matters connected with the conveyance of troops to the colonies. These sums, added together, will give a total of above £1,000,000 sterling as the direct naval expenditure by Great Britain, on account of the colonies, for one year. To form a fair estimate of the whole naval expenditure by Great Britain, on account of the colonies, for one year, it would be necessary to add to this sum of £1,000,000 sterling, a very considerable sum on account of reliefs, and of building new ships, likewise a portion of the cost of the naval establishments at home, and likewise a portion of the expense of the packet service to the colonies, which last item alone costs £418,000 a year. It is evident, therefore, that I shall very much underestimate the naval expenditure by Great Britain, on account of the colonies, when I set it down at only £1,000,000 sterling a year, or at one-eighth of the whole naval expenditure of Great Britain.

Thirdly, the civil expenditure by Great Britain on account of the colonies is chiefly defrayed by sums annuallyCivil and ecclesiastical expenditure.voted in the miscellaneous estimates, under the head of colonial services; some portion of it, however, is paid for under Acts of Parliament. It may be estimated this year at £300,000. It consists of numerous items, to some of which I shall have presently to refer. I will now only mention that we pay £27,000 a year for the Colonial Office, £20,000 a year for ecclesiastical establishments in the West Indies, between £11,000 and £12,000 a year for the clergy of North America, and that last year we divided the diocese of Australia into four bishoprics, erected a bishopric at Cape Town, and conveyed the right reverend gentleman who held these sees to the colonies, at the expense of this country.

Lastly, under the head of extraordinary expenditure by Great Britain, on account of the colonies, I put down such items as the insurrection in Canada, for which, in the interval between 1838 and 1843, there wereExtraordinary expenditure. special grants to the amount of £2,096,000; as the Kaffir war, on account of which there is a special grant this year of £1,100,000, and for which we shall have probably to pay eight or nine hundred thousand pounds more; as the Maori war in New Zealand, which, at a low estimate, will cost half a million; as £214,000 for the payment of the debts of South Australia in 1842; as relief of sufferers by fire and other disasters in the colonies, for which we gave £50,000 in 1846; as the risk of non-payment of loans, such as £236,000 to the New Zealand Company, and £716,000 to the West Indian planters; and innumerable other items. On the average of the last ten years, £200,000 a year would have been wholly inadequate to cover the extraordinary expenditure by Great Britain on account of the colonies. I will put it down, however, at £200,000 a year, and I will omit all mention of the sums paid for emancipating the negroes in the colonies, and the civil expenditure on account of our attempt to suppress the slave trade, which many persons would charge to the account of extraordinary colonial expenditure.

If the four sums which I have just mentioned be added together, namely, £2,500,000 for the army, including ordnance and commissariat, and £1,000,000Totals. for the navy, £300,000 for civil services, and £200,000 for extraordinary expenses, the total direct expenditure by Great Britain, on account of the colonies, would amount to at least four millions a year; and I am inclined to think that this is very much less than the actual annual cost of the colonies to Great Britain. Now, I beg the House to observe, that the declared value of British produce and manufactures exported to the colonies in the year 1844 was nine millions sterling, including the one million's worth of exports to Gibraltar, which are sent to Gibraltar to be smuggled into Spain. Therefore the expenditure of Great Britain on account of the colonies amounts to nine shillings in every pound's worth of its exports; or, in other words, for every pound's worth of goods that our merchants send to the colonies, the nation pays nine shillings; in fact, a large portion of our colonial trade consists of goods which are sent to defray the expenses of our establishments in the colonies. What are the advantages which we derive from our colonial possessions in return for this expenditure? Colonies are supposed to be useful either for political or commercial purposes, and with reference to these objects they should be divided into two classes, which should be considered separately; first, military stations, acquired chiefly for political purposes; secondly, colonies, properly so-called, supposed to be of value chiefly for commercial objects.

Our military stations are Heligoland, Gibraltar, Malta, the Ionian Islands, Bermuda, the stations on the west coast ofMilitary stations.Africa, St. Helena, the Cape of Good Hope, the Mauritius, Hong Kong, Labuan, and the Falkland Islands. What do these stations cost us? Of what use are they to this country? They are called the outposts of the British empire, and they are supposed to be useful in periods of war, for purposes of aggression. But it appears to me that most of them are so far removed from the centre of the empire, that in time of war they would be sources of weakness and not of strength; for they would compel us, contrary to every sound principle of warfare, to scatter instead of concentrating our forces. Therefore, in the event of a really serious struggle, they would, like other outposts, in all probability, be abandoned to their fate. Moreover, it is evident that we can only retain possession of them as long as we have the dominion of the seas; but having the dominion of the seas, I cannot see why we should cover all of them with fortifications, and fill all of them with troops. I believe a wiser generation will hold wiser opinions with regard to the utility of these possessions. I will, however, for the present, suppose that some of them are of some use to the country, and proceed to tell the House what they cost us.

First, Gibraltar and Malta. In 1843–44 the total expenditure incurred by Great Britain on account of these stations was £366,000. About the same sum is expended upon them every year, for their garrisonsIn Europe. consist of between 5000 and 6000 men (exclusive of artillery and engineers), and considerable sums are annually expended on building and repairing fortifications, naval works, etc. It is stated in the navy and ordnance estimates of this year, that the works now in progress in these two colonies will cost us £460,000. I will not ask whether they are worth the price we pay for them. But I do question the utility of protecting the Ionian Islands with 2500 troops, at a cost to this country of about £130,000 a year, which is somewhat more than the declared value of our exports to those islands in 1844. When England first became the protecting sovereign of the Ionian States, it was on the express condition that a portion, at least, of their military expense should be borne by the States; the sum to be paid was subsequently fixed at £35,000 a year. In 1842 the Ionian States were £122,000 in arrear, and I believe the arrears are still greater at present. We have spent large sums on military works at Corfu, and a grant of £12,873 is to be proposed this year to complete some of these works. Therefore our military stations in the Mediterranean require about 8000 troops, and they cost us at least half a million a year, exclusive of any portion of the expense of the fleet in the Mediterranean. That fleet, on the average of the last five years, has consisted of twenty-three ships, with a complement of 5000 men, the expense of which, for wages, victuals, wear and tear, may be reckoned at half a million a year. The declared value of our exports to these stations is about £1,400,000, of which nearly a million is a smuggling trade through Gibraltar into Spain.

I next proceed to the Bermudas. Since the peace we have expended there upwards of £600,000 (exclusive of theThe Bermudas.cost of convict labour) on navy and ordnance works alone; and it is now estimated that to complete these works a further sum of £160,000 will be required. At the Bermudas there is a garrison of 1200 men, at a cost (exclusive of the expense for convicts) of about £90,000 a year. Now, what is the use of such costly establishments and fortifications on these worthless rocks? It is said that the Bermudas are useful as a means of aggression against the United States, and that we have garrisoned them and fortified them lest the United States should take possession of them. I believe the United States would not accept of them as a gift. They are chiefly used as a comfortable residence for the admiral on the North American station, for whom it is proposed to build a house at a cost of about £15,000.

I next proceed to St. Helena, which cost us in civil and military expenditure about £40,000 a year, and to the coloniesSt. Helena.on the western coast of Africa, which in a similar manner cost us about £52,000 a year. These colonies are not, strictly speaking, military stations, nor are they of much commercial importance: their main object is to impede the slave trade. The fleet which we had last year upon this station consisted of twenty-four ships, with 259 guns, and a complement of 2781 men, and its cost was returned to Parliament for wages, victuals of crews, and wear and tear of ships, at £301,628 a year. Besides these sums we generally expend about £80,000 a year on other matters connected with what is called the suppression of the slave trade. Therefore, at least half a million a year is the direct expenditure by Great Britain in the vain attempt to put a stop to that traffic. It may not be proper to include all this under the head of colonial expenditure; but, nevertheless, I may be permitted to express my belief that it is a most useless expenditure, and to recommend Parliament to abandon it, together with the colony of Sierra Leone, and the other stations on the west coast of Africa, and thus to save the country an outlay of at least £450,000 a year.

I now arrive at the colony of the Cape of Good Hope (the area of which is considerably larger than that of the United Kingdom). It may be looked upon as a commercial colony as well as a military station. As a commercial colony, it is not of much importance. In 1844, the declared value of our exports to it was only £458,000, and our imports from it were £258,000. The difference was made up by the military expenditure of Great Britain, which for 1843–44 amounted to £294,000, or more than 50 per cent. on our exports. In that year the number of troops in the colony was 2951 rank and file; last year, the number was at one timeThe Cape and the Kaffir wars. 5470 rank and file. This increase was in consequence of the Kaffir war; and for the same reason the fleet on this station was increased to nine ships, with a complement of 1700 men, which fleet must have cost this country at the rate of £170,000 a year. For that war we have already paid £1,100,000, and, in all probability, £800,000 or £900,000 more will be required to close the account. The House will be not astonished at this expenditure when it is informed, in the words of Sir Harry Smith, ‘that in the last bit of a brush with a Kaffir chief called Sandhilli, £56,000 were expended in waggon-hire alone.’ One word with regard to that war—for it is a striking instance of the pranks that colonial governors can play, of the little control that the Secretary of State for the Colonies can exercise over them, and of the danger to which this country is perpetually exposed, under the present colonial system, of having vast sums of money expended upon a worthless colony. The Cape of Good Hope is the Algeria of England. The Kaffir war which has just terminated was, I believe, the fourth in the last thirty years. The one which preceded it is said to have cost this country half a million sterling. All these wars have originated from nearly the same cause, namely, cattle-stealing along a frontier of upwards of 700 miles. Sometimes the Kaffirs stole, or were accused of stealing, the cattle of the colonists; the colonists retaliated; then they came to blows; blood was shed; the Colonial Government interfered; a large expenditure of public money ensued, to be paid for out of the Imperial treasury. This was the case in the last war. With regard to the origin of that war, there is a great difference of opinion. Some persons, apparently with great reason, ascribe it to the discontinuance of the system of Sir B. D'Urban, and the adoption of the mistaken policy of the missionaries; and they maintain that the war was inevitable, and only too long delayed by attempts to conciliate the Kaffirs. Other persons, with much show of reason, ascribe its origin and ill success to the haste and indiscretion of the governor, Sir P. Maitland. However this may be, the immediate cause of the war was this: a Kaffir on the frontier stole an axe. He was arrested and sent off to prison. On the road a rescue was attempted; a conflict ensued; on the one side a Kaffir, on the other side a Hottentot constable were slain, and the prisoner was rescued. Application was then made to certain Kaffir chiefs to give up the offenders. They refused, on the grounds that the colonial authorities were not entitled by treaty to send a Kaffir to prison for such a trifle as stealing an axe, and that the blood of the Hottentot had been paid for in the blood of the Kaffir first killed; and they entreated the governor not to be in haste with forces, but to have a talk about the matter and try to understand it. However, the governor at once hastened to the frontier; by his orders Kaffirland was invaded; but every arrangement was so ill made that our troops were repulsed; twice our baggage-waggons were cut off; and the victorious Kaffirs, in their turn, invaded the colony. For months Sir P. Maitland lived in the bush, enduring, according to his own account, unheard-of hardships, when he was very properly superseded. Great was the amazement and indignation of his successor, Sir Henry Pottinger, at the state of affairs which he discovered in the colony. He declares that he cannot give an ‘adequate idea of the confusion, unauthorized expense, and (as he believed) attendant peculation which had obtained.’ In that peculation it is rumoured that men of high station were implicated. Numerous instances of reckless expenditure are stated in Sir Henry's despatches. One of a settlement on the Kat River, where the few inhabitants were, on the plea of defending the frontier, receiving rations at the rate of £21,000 a year. Another, in the vicinity of a station called Block Drift, where rations had been regularly given to a number of Kaffirs, who had been fighting against us. Sir Henry attempted to put a stop to these abuses; and the war seemed to be drawing to a close, when, unfortunately, fourteen goats were lost. They were tracked across the frontier into the territory of a Kaffir chief; he was required to restore them, and to give up the supposed thief. Twelve of the goats were immediately sent back, but the chief denied all knowledge of the other two, and of the thief, if there were one. Sir Henry Pottinger was not satisfied. He ordered a secret expedition into Kaffirland, to surprise the chief in question. The expedition, as usual, failed; the chief escaped; the troops retreated, after having killed a few Kaffirs, and carried off some head of cattle; and the war was kindled afresh. Throughout, Sir Henry Pottinger was thwarted by a divided command; and the greater portion of his troops were unsuited for the service which they had to perform. For instance, old officers of the Peninsula, accustomed to regular warfare, were intent upon displaying their strategic skill in a contest with savages; heavy dragoons, mounted upon chargers, armed with rifles impossible to load on horseback; and English regiments, with their ordinary clothing and accoutrements, had, under the burning sun of Africa, to attack Kaffirs skulking in a bush all but impenetrable to Europeans. In such a war, seven British regiments, with artillery and engineers, were not a match for half the number of naked savages armed with assegais. The war would never have been brought to a close had it not been for the colonial corps, who, composed of Hottentots, led on by brave and energetic young English officers, followed the spoor of the Kaffirs, captured their cattle, and hunted them down like wolves. By these means Sir Henry Pottinger brought the war to a close just as he was succeeded by Sir H. Smith. Sir H. Smith, in addition to other marvellous feats, has made the Kaffir chiefs kiss his foot, has proclaimed himself their only Inkosi Inkulu (great chief), and has added, on the north of the colony, some 40,000 square miles (about the size of England) of as barren a desert (to use the words of the surveyor-general) as is to be found upon the earth's crust. Thus the loss of one axe and two goats on the frontier of the Cape of Good Hope has cost this country a couple of millions sterling. I attach no blame to Lord Grey or his predecessor on account of this war; it is clear from their despatches (I trust they will pardon me for saying it) that they were helpless and ignorant; and I believe Lord Grey was as much astonished as any man when he heard the amount of the bill to be paid. I warn the House, however, that, under the existing system, there is no reason whatever why, every four or five years, there should not be a similar war, with a similar bill to pay. For, with a frontier of about 700 miles in extent, causes of war with the neighbouring savages will perpetually recur. In the colony such a war is most popular, and is wished for on account of the lavish expenditure of Great Britain; and every effort is made to prolong its duration. There is but one means of securing our purses for the future, namely, by withdrawing our troops from the frontier, and letting the colonists distinctly understand that they must defend themselves, and pay the cost of such defence. Then they will have the strongest motives to prevent the commencement, and to hasten the termination, of a Kaffir war. In return for so doing, they should receive free institutions, and have complete control over their own expenditure. Then a thousand troops would be a sufficient garrison for Cape Town; and, in ordinary years, there might be a saving at the Cape, in military expenditure alone, to the amount of at least £200,000 a year. If, however, public money is to be spent at the Cape of Good Hope, it would be better both for this country and for the colony that it should be spent on emigration. I believe that about £10 a head is sufficient to defray the expense of sending emigrants to that colony. Now, the direct military expenditure by Great Britain on account of the colonies is at the rate of £60 a year for each soldier in the colonies. Therefore, if we were to reduce our military force at the Cape by 1500 men, and were to send there, in their stead, 9000 emigrants a year, there would, in all probability, be a reduction in our expenditure on account of that colony; and the rapid increase of population would enable the colonists to guard their frontier effectually against the Kaffirs.

From the Cape of Good Hope I proceed to the Mauritius, which may likewise be looked upon, to a certain extent, as a commercial colony. The declared value of the exports to it of British produce was £285,000 in 1844. The whole expenditure by Great Britain, in 1843–44, on account of this colony, was £92,000; I should think that it costs somewhat more at present, for we have about 2000 troops atMauritius. the Mauritius, and we are going to improve the defences of the island, at the estimated cost of £150,000. Where is the necessity for keeping this amount of military force at the Mauritius? Is it in order to keep down the planters? It is true they are discontented and overburdened by taxation; but the best plan would be to bestow upon them free institutions, and to give them complete control over their expenditure; then a thousand men (which was about the amount of the military force in that colony in 1826) would be an ample garrison.

From the Mauritius I should proceed to Hong Kong; but first, I will stop for a moment at Ceylon. As Ceylon is neither a military station nor a colony, properly so called, but is a subjugated territory of the same kind as our possessions in India, it appears to me that it would be better governed by theCeylon.East India Company than by the Colonial Office, in which case we should have nothing to pay for the troops in that island. In 1843–44 the military expenditure by Great Britain amounted to £110,000, in addition to a military expenditure by the colony of nearly £70,000. At present the military force in Ceylon consists of 4000 troops, including colonial corps. Now, £110,000 a year is a heavy price to pay for a colony, the declared value of our exports to which did not exceed £240,000 in 1844; it is true, however, that the import trade from Ceylon, especially of coffee, is rapidly increasing in value.

I now arrive at Hong Kong. From the 1^st of May, 1841, when we took possession of that island, up to the 30^th September, 1846, we have expended upon it £314,000, exclusive of the sums derived from the local revenue. I find in the Navy, Ordnance, Commissariat, and MiscellaneousHong Kong.Estimates for this year, that Hong Kong appears under sixteen different heads, for sums amounting in all to £94,514; to which must be added the expense of paying, clothing, etc., of 1200 troops, which must amount to at least £40,000 a year. Therefore Hong Kong bids fair to be a costly colony, as, indeed, it ought to be, when the salary of the governor is £6000 a year. As the East India Company has a fleet of its own to defend its own possessions, the greater portion of this expenditure is on account of the trade with China, which, on the average of the last four years, did not exceed £2,000,000 a year in British produce and manufactures.

Next, I have to inform the House that Labuan appears this year for the first time in our estimates [Mr. Hume: ‘Ha, ha,’ laughter], as yet only in the miscellaneous estimates for the sum of £9827, £2000 of which is the salaryLabuan, etc. of his Excellency the Rajah Brooke, of Sarawak [Mr. Hume: ‘Ha, ha,’ laughter], to whose dominions in Borneo we have this year appointed a consul at a salary of £500 a year. Now, as in these matters the first step is all the difficulty, we may expect in a year or two to see Labuan, Sarawak, and perhaps in their train some half-dozen other Borneon principalities, holding conspicuous places in the Army, Navy, Ordnance, as well as Miscellaneous Estimates. Then we shall build barracks and fortifications, and garrison them with a few troops. The troops will create a demand for a small quantity of British produce and manufactures. To protect the trade thus arising, a ship or two of war will be stationed in the neighbourhood. Thus, in proportion to the increase of the public expenditure will be the increase of the traffic, till at length we shall be informed that the British merchant is carrying a flourishing commerce with these settlements, at the usual cost to the nation, of ten shillings in every pound sterling of her exports. This is the most approved Colonial Office fashion of colonizing and creating a colonial trade, very different from the old English mode.

I will now conclude the catalogue of the military stations with the Falkland Islands. On that dreary, desolate, and windy spot, where neither corn nor trees can grow,Falkland Islands. long wisely abandoned by us, we have, since 1841, expended upwards of £35,000; we have a civil establishment there at the cost of £5000 a year; a governor who has erected barracks and other ‘necessary’ buildings, well loop-holed for musketry; and being hard up for cash, he issued a paper currency, not, however, with the approbation of the Colonial Office.

Thus it appears that our twelve military stations and Ceylon contain about 22,000 troops; and that portion of their civil and military expenditure which is defrayed by Great Britain amounts to at least £1,300,000 a year, exclusive of extraordinary expenditure for Kaffir wars, etc., which, on the average ofTotal cost of military stations.the last ten years, may be put down at much more than £100,000 a year. To these sums must be added a portion of the cost of the four large fleets which are stationed at or in the vicinity of the military stations; namely, on the Mediterranean, the African, the Cape, and the Chinese stations. These fleets consist at present of 93 ships, with a complement of 18,000 men, and must cost a million and a half a year for wages and victuals of crews, and wear and tear of vessels.

What I propose to the House is this: to withdraw our military protection from the Ionian States; to dispense withProposed economics.our stations and fleet on the west coast of Africa; to reduce our establishments at the Cape and the Mauritius, and to bestow on these colonies free institutions; to transfer Ceylon to the East India Company; to keep a sharp watch over the expenditure for Hong Kong, Labuan, and Sarawak; and to acknowledge the claim of Buenos Ayres to the Falkland Islands. Then 10,000 men, instead of 22,000, would be sufficient to garrison the military stations in the following manner: 6000 for Malta and Gibraltar; 4000 for Bermuda, the Cape, the Mauritius, and Hong Kong. If this were done, there would be a reduction in military and naval expenditure to the amount of at least a million a year for the military stations alone.

I now come to the colonies, properly so called, which have been planted in North America, the West Indies, and Australasia. For what purposes, I ask, were colonies originally planted by England? What benefit does this country derive from her dominion over her colonies? OurThe colonies proper, and the old system of colonial monopoly.ancestors would have answered these questions in the following manner. They would have told us how a little more than two centuries ago some of the inhabitants of this island, being uneasy at home, had migrated to America; they were prudent and energetic men, of the true Anglo-Saxon breed, which is best fitted to wage war with the savage and the forest; and being left alone, they flourished; and in the course of a few years, without costing one farthing to the country, they became a numerous and a thriving people. Then the shopkeepers and other traders of England wished to secure their custom, and, according to the notions of the day, they petitioned Parliament that the colonists should be confined to the English shop; first, for buying all the goods they wanted in Europe; secondly, for selling all such parts of their colonial produce as the English traders might find it convenient to buy. Parliament acceded to this request. Thence the old system of colonial monopoly, which was the sole end and aim of the dominion which England assumed over her colonies. To maintain that monopoly and that dominion, vast sums were expended, costly wars were waged, and huge military and naval establishments were kept up; but it was always supposed that the expense thus incurred was repaid by the benefits derived from the monopoly of the colonial trade. I will not attempt to strike the balance of past profit or loss. It is evident, however, that with the abandonment of colonial monopoly, the arguments in favour of colonial dominion, which were derived from that monopoly, must likewise be abandoned. Now to monopoly free trade has succeeded, and the last relic of the colonial system, in the shape of the navigation laws, is about to perish. Our colonies are free to trade with whom they will, and in what manner they will. Therefore they will only trade with us when they can do so more profitably with us than with other countries. Therefore, as far as trade is concerned, the colonies are become virtually independent States, except that they may not enact laws to restrain their inhabitants from buying from us, or selling to us, if it be for their interest so to do. It is evident, however, that if the colonies were independent States, they never would be so foolish as to prevent their inhabitants from selling to us; but it may be said that they might be so foolish as to prevent their inhabitants from buying from us. If this be all the mischief which, as far as trade is concerned, is to be apprehended from the colonies becoming independent States, then it follows that all the benefit which, as far as trade is concerned, we derive from the sums which we expend on colonial dominion, consists in the power which we thereby possess of averting the possibility of the colonies enacting hostile tariffs against our produce and manufactures. The amount of this benefit must evidently depend upon the value of our export trade to the colonies. Now, the declared value of the export of British produce and manufactures to the North American, West Indian, and Australasian colonies for the year 1844 (the last complete return) was about £6,000,000; the direct expenditure by Great Britain, on account of those colonies, cannot be less than £2,000,000 sterling a year. I ask, is it worth our while to spend a couple of millions a year to guard against the possibility of a diminution in an export trade of £6,000,000 a year? I put this question to any mercantile man: Would it be worth his while to pay 6s. 8d. in the pound on the value of his goods, to secure that those goods shall freely compete with the goods of other nations in the markets of the North American, West Indian, and Australasian colonies? And if it be not worth his while, is it worth our while to pay it for him? This is undoubtedly a great and marvellous empire, in many respects unparalleled in history, but in no respect more marvellous than with reference to its colonies. Every other nation has attempted, in some shape or form, to draw tribute from its colonies; but England, on the contrary, has paid tribute to her colonies. She has created and maintained, at an enormous expense, the extensive colonial empire for the sole purpose of buying customers for her shopkeepers. This (as Adam Smith has justly observed) was the project, not of a nation of shopkeepers, but of a Government influenced by shopkeepers. It may be said that I have omitted to consider the value of the import trade from the colonies, which is equal to the value of the export trade; but no one fears that the colonies would, if they became independent States, refuse to sell to us; they would only be too happy so to do. We do not, therefore, require colonial dominion in order to buy from them; and, in fact, we do not really require colonial dominion even to sell to them; for if we buy from them, it would be for their interest to receive payment in our produce and manufactures, if cheaper than those of other countries, and that interest would in the long run prevail. It does appear to me, therefore, to be a manifest absurdity to spend vast sums of money on colonial dominion, for the purpose of securing free trade with the colonies. I now ask, is this large colonial expenditure by Great Britain necessary in order to maintain the connexion between Great Britain and her colonies, which shall secure free trade between them, and the other benefits which I do believe Great Britain may derive from her colonies? I must be permitted to consider these questions separately with regard to each of the three great divisions of the colonies.

In the North American colonies, the military force amounts to about 9000 men. The military expenditure by Great Britain for the year 1843–44, was £698,000. The civil expenditure by Great Britain for the same year was £34,000; this sum included an annual charge of about £12,000 for the North American clergy, and of about £15,000 for the Indian department. The whole direct expenditure by Great Britain for that year was returned to Parliament at £736,691. To this sum must be added a portion of the expense of the packet service, which costs £145,000 a year; and a portion of the expense of the fleet on the North AmericanThe North American colonies. and West Indian station, which, on the average of the last ten years, must have cost £300,000 a year. When it is remembered that, in addition to these sums, Parliament specially granted, in the interval between 1838 and 1843, £2,096,046 on account of the insurrection in Canada; in 1846, £50,000 to sufferers by fire at Quebec and St. John's; and in other years, smaller sums on account of the Rideau Canal, canal communication in Canada; militia and volunteers in Canada, etc., etc., which in the interval between 1835 and 1847, amounted to £193,174, it follows that the North American colonies have cost Great Britain at the rate of at least a million sterling a year during the last ten years, and at present they must cost at least £800,000 a year. Now, on the average of the five years ending with 1844, the declared value of British produce and manufactures exported to the North American colonies was £2,600,000 a year. Is it worth our while to pay £800,000 a year, that is, 30 per cent. on these exports, to guard against the possibility of some diminution in that trade? For what purpose do we keep 9000 troops in North America? Is it to protect the colonists against the United States? But if they are loyal at heart, they are strong enough to protect themselves; if they are disloyal, twice 9000 men will not keep them down. But suppose they were to separate from us, and to form independent States, or even to join the United States, would they not become more profitable as colonies than they are at present? The United States are, in the strict signification of the word, still colonies of Great Britain, as Carthage was a colony of Tyre, and the cities of Ionia and Sicily were colonies of Greece; for the word colony does not necessarily imply dependency, but merely a community composed of persons who have removed from one country and settled in another, for the purpose of cultivating it. Now, our colonies (as I will term them) of the United States are in every point of view more useful to us than all our other colonies put together. In 1844, we exported to the United States produce and manufactures to the value of £8,000,000; an amount equal to the whole of our real export trade to all our colonial dominions, which we govern at a cost of £4,000,000 a year; while the United States cost us for consular and diplomatic services not more than £15,000 a year; and not one ship of war is required to protect our trade with the United States—in fact, a British ship of war is very rarely seen off the coast of the United States. Again, more emigrants go directly from this country to the United States than to all our other colonies put together. In the ten last years, according to the returns of the Emigration Commissioners, 1,042,000 emigrants left this country, of which number 552,000 went directly to the United States; how many went indirectly through Canada I cannot undertake to say. Last year, 251,000 persons emigrated from Great Britain to North America, 142,000 of whom went directly to the United States, the remaining 109,000 to the colonies. At present, it is considered that colonies are chiefly useful as affording markets for our produce, and outlets for our population. It is evident that in both these respects, independent colonies are as useful as dependent ones. I do not, however, propose to abandon the North American colonies; but if we are compelled to choose between the alternative of the continuation of the present vast expenditure and that of abandoning these colonies, it is evident that the latter alternative would be the more profitable one in an economical point of view. But I maintain, that if we govern our North American colonies as we ought to govern them, follow out rigorously the principle of responsible government, and leave them to manage their own affairs, uncontrolled by the Colonial Office, we may with safety diminish our military force and expenditure, and they will willingly continue to be our fellow-subjects.

In the West Indies the military force amounts to about 6000 men. In the year 1843–44, the military expenditure was £513,386; the civil expenditure was £74,462. This civil expenditure consists of an annual charge of £20,300 for ecclesiastical establishments; of about £18,000 for the salaries of governors; and of about £35,000 for the salaries of stipendiary magistrates. The total amount of the direct expenditure incurred by Great Britain on account of these colonies for 1843–44, has been returned at £593,834, or within a trifle of what it was in 1835–36. But in order to form a fair estimate of the whole cost of these colonies, we should addThe West Indies. to this direct expenditure a portion of the expense of the fleet on the North American and West Indian station, which fleet, as I have already stated, must cost the country at least £300,000 a year; a portion likewise of the expense of the packet service to and from the West Indies, which is contracted for at £240,000 a year; likewise something on account of the risk of the non-repayment of loans, such as £50,000 this year on account of the hurricane in Tobago; £166,000 which the Colonial Office, somewhat usurping the ordinary functions of Parliament, promised without consulting Parliament to British Guiana and Trinidad in February last; and the £50,000 with which the noble lord the member for the city of London has vainly hoped to appease the West Indian interest. How much of these loans will ever be repaid? And we must likewise add the cost of landing captured negroes free of charge in the West Indies; I have already mentioned the cost of capturing them. I am afraid, therefore, that our West Indian colonies will in future cost this country directly much more than £700,000 a year, which is just one-fourth of the declared value of our annual exports to these colonies, on the average of five years ending 1844. And that export trade is decreasing, and will decrease; for there can be no doubt that the value of West Indian property has greatly diminished. I will not trespass on the patience of the House by making any observations on the state of the West Indies, as that subject was so fully discussed a short time ago. I will merely remark, that some West Indian proprietors have said that we must either restore the value of their property by protecting their sugar, or they will throw off our dominion. Now, if we choose between these alternatives there can be little doubt which would be the cheaper; for if we were to abandon those colonies, there would be a direct saving of £700,000 a year, and no protecting duty on sugar. In fact, if we were to make them a present of ten millions sterling, on condition of their becoming independent States, we should be gainers thereby to the amount of at least £350,000 a year. Though I utterly disbelieve that the West Indian colonies can ever be of the slightest value to this country, as colonies, for their climate is quite unsuited to our race, and they will, in all probability, become negro islands, like Haiti; though they have been the most costly, the most worthless, and the worst managed of our colonies—a perpetual drain on the pockets of the people of England—yet I do not propose to abandon them, except at the express wish of the colonists. I should merely propose to reduce our military force to half its present amount, and to effect a saving of about £300,000 a year.

In the Australian colonies, including New Zealand, the number of troops must at present be about 5000 men; and the military expenditure by Great Britain must amount to about £270,000 a year. The civil expenditure by Great Britain for this year, according to the miscellaneous estimates, will be about £30,000. Therefore, the direct expenditure by Great Britain on account of these colonies must amount to at least £300,000 a year, exclusive of such items as £15,402 for the abandonment of Lord Stanley'sAustralia and New Zealand. colony of North Australia; £214,936, which we first lent, and then gave, in consequence of Colonel Gawler's extravagances in South Australia; and I know not how much for the follies of Captains Hobson and Fitzroy in New Zealand, who involved us in a war with the natives, which is still going on. The bill has not yet been sent in. Will £500,000 cover it? I am afraid not; for portions of three regiments are quartered in that colony; and there are three or four ships of war, with a complement of about 800 men, stationed off the coast; these ships must cost for wages, provisions, wear and tear, etc., about £80,000 a year. Now, the declared value of our exports to the Australian colonies, on the average of the five years ending 1844, was only £1,000,000 a year; putting down our expenditure only at £300,000 a year, that expenditure would amount to 30 per cent. on the value of our exports. Now, it is certain that not one single soldier is required in Australia except to keep the convicts in order; nor would one soldier have been required in New Zealand had it not been for the preposterous mismanagement of that colony by the Colonial Office. Supposing, however, that 2000 men were required for the convict service in Van Diemen's Land, and 1000 men for New Zealand, the military force in the Australian colonies might be reduced to 3000 men.

Thus it appears that the military force in the North American, West Indian, and Australian colonies amount to about 20,000 men, and the direct expenditure by Great Britain, on account of these colonies, to about £2,000,000 a year. I should propose to reduce that force to 10,000 men, whereof 4000 men would be sufficient for North America, 3000 for the West Indies, and 3000 for Australia; and then, in my opinion, less than £1,000,000 a year would suffice to defray the expenses of those colonies to Great Britain.

Therefore, the whole reduction which I should propose at present to make in that portion of the colonial expenditure which is defrayed by Great Britain is £2,000,000 a year. I should effect that saving partly by a reduction of 22,000 men in the military force in the colonies; partly by a reduction of the naval and civil expenditure on account of the colonies; and partly by removing the causes which have led to Canadian rebellions, Kaffir and New Zealand wars, and the like. If this were accomplished, still, however, the colonies would continue to cost the large sum of £2,000,000 a year; but I believe that a further reduction might ultimately be made on account of the commercial colonies; indeed, they might cost us next to nothing, if we gave them complete control over their own affairs, on condition that they should pay their own expenses. The military stations, however, must always be a source of great expense, and if we retain them we must be content to pay dearly for our whistle.

I shall now proceed to the consideration of that portion of the colonial expenditure of the British Empire which is defrayed by the colonies themselves. A return has just been presented to the House of that expenditure for the last year in which it could be made up. In most instances it is for the year 1845; it is not materially different from the returns for previous years; I may, therefore, without any considerable inaccuracy, assume that it represents the ordinary annual expenditure by the colonies, and especially for the year 1845. From that return it appears that the total expenditure by all the colonies (excepting Ceylon and theColonial self-government and rates of expenditure. stations on the west coast of Africa, for reasons which I will presently state; and likewise the Ionian Islands, from which there was no return), was about £3,350,000 for the year 1845. The population of these colonies was about 3,400,000; therefore the annual expenditure was at the rate of 19s. 8d. per head of the population. The rate of expenditure, however, varies considerably in different colonies, according to the form of local government. It is greater or less, according as the colonists have less or more control over their own expenses. This is a most important fact, to which I wish to call the special attention of the House. I have instituted a comparison between the rate of expenditure of those colonies which have, and those which have not, representative assemblies. From that comparison I have omitted Ceylon; because Ceylon is not a colony properly so called, but belongs to the class of our Indian possessions, and it is evident that a rate of expenditure which might be considered trifling for a population composed chiefly of Europeans, might be excessive for a population of the Cingalese and Veddahs of Ceylon. I have likewise omitted the colonies on the west coast of Africa; for there is no account of their population on which any reliance can be placed; and the Ionian Islands have also been omitted, because, as I have already said, their expenditure has not been returned to Parliament in the return in question. With these omissions, I find that the rate of expenditure of the colonies with representative assemblies is less than one-half of the rate of the expenditure of the colonies without representative assemblies. The colonies with representative assemblies have a population of about 2,580,000, and their expenditure in 1846 was £1,930,000, or at the rate of 14s. 11d. per head of their population. On the other hand, the population of the colonies, without representative assemblies, was about 820,000, and their expenditure in 1845 was £1,420,000, or at the rate of £1 14s. a head of their population, or 18s. 7d. a head more than in the colonies with representative assemblies. I am convinced that this great increase of the rate of expenditure in the Crown colonies is mainly to be attributed to the want of self-government; for it is most apparent when the rate of expenditure in each class of colonies is examined and considered separately.

The rate of expenditure is the lowest in the North American colonies, where there is the greatest amount of self-government. In fact, since the last insurrection in Canada, and the establishment of the doctrine of responsible government, Canada has become, in most respects, an independent State, except as far as the civil list is concerned, and except that it is now and then subjected to some mischievous and foolish interference on the part of the Colonial Office. Now the expenditure of the North American colonies in 1845 was £1,134,000, their population was 1,700,000; therefore the rate of expenditure was 13s. 4d. per head of the population, or 1s. 7d. less than the average rate of the colonies with representative assemblies. But it should be remarked, that of the £1,134,000 expended in 1845 by the North American colonies £500,000 was an extraordinary expenditure by Canada, on account of new works and buildings, a large portion of which was defrayed by a loan. If a portion of this loan be omitted, as it ought to be, from the annual expenditure, then the rate of expenditure by the North American colonies for the year 1845 would have been nearly the same as it was for the year 1842, when it amounted to about 9s. a head of the population. Though this rate of expenditure is low, as compared with other colonies, yet it is about thirty per cent. higher than that of the United States for similar purposes. The difference mainly arises from the high scale of salaries paid to the higher functionaries in the North American colonies. Generally speaking, those functionaries receive from three to four times the amount of the salaries of similar functionariesSalaries of officials in North America. in the United States. For instance, in the Canadas, with a population of 1,200,000, the governor is paid £7000 a year; in the United States, the President has only £5000 a year, and no governor has more than £1200 a year; in the State of New York, with a population of 2,600,000, the governor only receives £800 a year. Again, the chief justices of Upper and Lower Canada are paid £1500 a year each, while the chancellor and chief justices of the State of New York receive only £800 a-year each. The puisne judges of Canada receive £1000 a year each; those of New York only £200 a year each. The governor of Nova Scotia is paid £3500 a year; the governors of New Brunswick and Newfoundland are paid £3000 a year each. In Massachusetts, with a population much larger than that of the three last colonies added together, the salary of the governor is only £500 a year. In fact, the four North American colonies which I have just mentioned, pay £2500 a year more for the salaries of their four governors, than the thirty states of the Union do for their thirty governors. Now in the colonies, the salaries are fixed by the various civil lists. These civil lists, being removed for a series of years from the control of the representative assemblies, are perpetual causes of quarrelling and discontent; and there is always a dispute going on between the Colonial Office and some colony or other on this subject, which frequently leads to the most unpleasant results. For instance, the dispute about the civil list of Canada was one of the causes which ultimately lead to the insurrection in that colony; and at present the Colonial Office is involved in a civil list quarrel with British Guiana. In all these quarrels, the object of the office is to keep up the pay of its functionaries, and the object of the colonists is a reduction of expenditure. There can be no doubt that the salaries of the higher functionaries in the colonies are excessive, as compared to the standard of the United States, which is the usual standard of comparison in the colonies. For the salaries of the governors of the thirty states of the Union amount in all to but £14,000 a year; therefore the average is £460 a year for the salary of each governor. Now there are eighteen British colonies which pay for their own governors; their salaries amount in all to £72,000 a year; therefore the average is £4000 a year for the salary of each of these governors, or nearly nine times the rate of pay in the United States. In fact, nine out of the eighteen governors in question receive as much as, or more than, the President of the United States. For instance, the governors of Canada, the Mauritius, and Ceylon, receive £7000 a year each; the governor of Jamaica has £6500 a year, and the governors of Gibraltar, Malta, the Ionian Isles, the Cape of Good Hope, and New South Wales, have £5000 a year each. I do not think this rate of pay is too high for noble lords and other gentlemen of rank and connection, when they undertake the duties of governors of the colonies; but if we are determined to employ such persons in the colonies, we ought to pay for them ourselves. On the other hand, if we insist upon the colonies paying their governors, it appears to me that, with the exception of the military stations, we should permit the colonies to elect their own governors and other functionaries, and to pay them what salaries they think fit. Such was, in olden times, the constitution of our colonies of Rhode Island, Connecticut, and Massachusetts; and the honour and distinction attached to the office of governor would induce the best men in the colonies to serve for moderate salaries. If, however, the colonists were to choose, in any particular case, a person unfit to be a governor, they would be the sufferers; they would have no one but themselves to blame; but, as I will presently show, it would be difficult for them to make a worse choice than the Colonial Office generally makes.

To return to the question of the comparative rates of expenditure in those colonies which have, and those colonies which have not, representative governments. In the West Indies the colonies with representative assemblies are Jamaica, the Leward Islands, the Windward Islands (with the exception of St. Lucia), and the Bahamas. Their population is about 700,000; their expenditure in 1845 was £450,000, or at the rate of 12s. 10d. per head of their population; the rate of Jamaica was 13s. Now compare this rate with that of the West Indian colonies without representative governments, namely, St. Lucia, Honduras, Trinidad,West Indies. and British Guiana (the combined court of which cannot with any propriety be termed a representative assembly); their population is about 190,000; their expenditure, exclusive of the cost of immigration, was £284,000, or at the rate of £19s. a head, or more than twice as much as that of the West Indian colonies which have representative assemblies. The salaries of the higher functionaries in the West Indian colonies are all excessive, as compared with the standard of the United States. Twelve governors and lieutenant-governors receive £29,000 a year, £16,000 of which are paid by the colonists to five governors. As I have already observed, the Colonial Office is involved in a civil list dispute with British Guiana. In consequence of the distressed condition of that colony, at the close of last year the elective members of the Court of Policy proposed a reduction of 25 per cent. upon all salaries above 700 dollars a year. The Colonial Office refused to accede to this proposal; and the governor carried the estimates for the year in the Court of Policy by the exercise of his double vote. The Combined Court then refused to vote the supplies for the period required by the governor. The Colonial Office has retaliated upon them for this conduct by stopping immigration to British Guiana, and by refusing the usual licences to carry liberated negroes from Sierra Leone to that colony. This unexpected proceeding has occasioned considerable inconvenience and loss to various shipowners in this country, who complain that no reliance can be placed upon the Colonial Office with its perpetually shifting regulations.

The Cape of Good Hope and the Mauritius have each of them about the same population, namely, 160,000, and beingCape and Mauritius.Crown colonies, their rate of expenditure is about the same as that of the Crown colonies of the West Indies, namely, £17s. a head; they are grievously taxed, especially the Mauritius. As I have already said, the Governor of the Mauritius has £7000 a year, and the Governor of the Cape has as much as the President of the United States.

It may be said that the rate of expenditure is higher in the Crown colonies, because, generally speaking, those colonies are more thinly peopled than the colonies with representative assemblies. It is perfectly true that, everything else being the same, the rate of expenditure in a thinly peopled territory will generally exceed that of aThe Crown colonies.thickly peopled one. But the Crown colony of the Mauritius is four times as densely peopled as Jamaica, yet the rate of expenditure in Jamaica per head of the population is less than one-half of what it is in the Mauritius. Again, the Crown colony of Malta is one of the most densely peopled spots on the face of the earth, yet the rate of expenditure is 16s. 6d. a head of the population, or twenty per cent. more than that of the plantations in the West Indies; or nearly double the ordinary rate of expenditure in the thinly peopled North American colonies. Again, Malta is more than twice as thickly populated as the Ionian States, but those states have a certain amount of self-government, and their rate of expenditure in 1840 (the last return which I have been able to get at) was 14s. 3d. a head, or 2s. 3d. a head less than that of Malta.

Ceylon is the only apparent exception to the rule, that the expenditure of colonies governed by the Colonial Office is greater than that of self-governed colonies. According to Sir Emerson Tennent, the population of Ceylon in 1846 must have amounted to 1,500,000, and the expenditure in that year was £498,000, or at the rate of 6s. 7d. a head of the population. It is true this rate of expenditure is lower than that of any other colony, yet I believe it will be found to be extravagant when the nature of the population is considered; for it ought to be compared with that of the territories governed by the East India Company, which are inhabited by an analogous population, but are locally governed by men carefully selected on account of their special aptitude. The population of those territories is said to be about 93,000,000, and the expenditure on the average of the five years ending 1844 was £20,000,000 sterling, therefore at the rate of 4s. 3d. a head of the population, or one-third less than that of Ceylon. There can be no doubt that if Ceylon were transferred, as I propose, to the East India Company, it would be more economically governed than it is by the Colonial Office.

Lastly, with regard to the Australian colonies. New South Wales is the only one which has a representative assembly of any kind. It commenced its existence in 1843,Expenditure of Australian colonies compared. and immediately caused an extraordinary diminution in the expenditure. In 1841 the free population of New South Wales amounted to about 102,000, and the ordinary expenditure, exclusive of immigration, was £350,000, or at the enormous rate of £3 4s. a head of the population. In 1843 the Representative Assembly at once diminished the expenditure for the subsequent year by £60,000; and in 1846, when the free population amounted to 178,000, the expenditure was only £254,000, or at the rate of £1 8s. a head of the population. This extraordinary reduction in the rate of expenditure may be attributed, to a certain extent, to immigration; but the reduction in the positive amount of expenditure can be distinctly traced to the commencement of local self-government in 1843.

Compare the rate of expenditure of New South Wales with that of the neighbouring colony of Van Diemen's Land, which has in vain petitioned for a representative assembly. In 1842 the free population of that colony amounted to 37,000, and on the average of the four years ending with 1844, the expenditure, exclusive of immigration, was £161,000, or at the enormous rate of £4 6s. a head. The rate of expenditure was not very different from that of the kindred colony of New South Wales prior to the establishment of representative government; but it was more than three times that of New South Wales after the establishment of a representative government. It must, however, be acknowledged that the difference in the rate of expenditure of the two colonies may be attributed in part, though certainly not altogether, to the abolition of transportation to New South Wales, and to its continuance, in its worst form, to Van Diemen's Land. The House may remember the appalling description which was given last year of the loathsome moral state of the convict population of that colony and its dependency, Norfolk Island; of their hideous crimes; of their frightful diseases; and of their atrocious murders. It was shown that the unhappy state of that colony was brought about partly by the negligence of the then Secretary of State for the colonies, Lord Stanley; partly by the mismanagement of the then Governor of Van Diemen's Land, Sir Eardly Wilmott; and partly by the misconduct of the then commandant of Norfolk Island, Major Childs. In consequence of these horrid disclosures, it was announced last year to the Governor of Van Diemen's Land, Sir W. Denison, that it was the intention of the Government that transportation should be discontinued altogether, and that announcement was received with great satisfaction in the colony. Unfortunately, it now appears that transportation is to be renewed to Van Diemen's Land, though in a mitigated form. The colonists will be bitterly disappointed and exasperated when they receive this information. At present they are discontented; for to meet the vast expenditure of the colony, taxes have been imposed which the judges have pronounced to be illegal; and one of the judges so deciding has been removed by the Governor, as the colonists believe, in consequence of his decision; a belief which, from the statements made to the House by the honourable gentleman the Under Secretary of State for the colonies, appears to be unfounded. The colonists, however, will have every reason to be dissatisfied with the renewal of transportation, which will mar their prospects, and make them for ever the plague-spot and reproach of Australasia.

In the other Australian colonies which have not representative governments, I am unable to state with accuracy the rate of expenditure per head of the population. In South Australia, at one time, it exceeded £10 a head per annum; and the colony became utterly bankrupt through the extravagance of its governor, Colonel Gawler. We had to liquidate its debts, partly by a gift in 1842 to the amount of £214,936, and by a loan of £85,000. This loan will be repaid, because South Australia is becoming rich, in consequence of the discovery of mines. With regard to these mines, it is said that the Colonial Office has created great dissatisfaction in this colony by reserving a royalty of one-fifteenth of their gross produce. The House is probably not aware that almost every year the Colonial Office makes some change in the management of the waste lands of the Australian colonies, which affects, to a greater or less extent, the value of all landed property in those colonies. For instance, with reference to minerals. Originally all minerals were reserved to the Crown, and only the surface of the soil was conveyed to the purchaser. In one instance, however, Lord Bathurst, when Secretary of State for the Colonies, gave all the coal in New South Wales to one company. In consequence of these reservations, no one had any interest in searching for or in discovering mines, therefore no mines were discovered, or, if discovered, they were carefully concealed. When, however, the noble lord the member for the city of London became Secretary of State for the Colonies, he, with his usual good sense, at once perceived the impolicy of such reservations, and under his rule all minerals were conveyed to the purchaser of the soil. Then mines were discovered, especially in South Australia; and then, to the astonishment of most persons, the Colonial Office determined upon reserving a royalty upon all future mines. Well, it matters not who did it. The consequence is, that the previously discovered mines, which are nearer the coast, and therefore can be worked with less expense, will have to pay nothing; whilst the subsequently discovered mines, which are further from the coast, and therefore more expensive to work, will have to pay a royalty of 6 2/3 per cent. on their gross produce. Such a measure is bad on economical grounds, and bad also in policy; for sound policy requires that this country should interfere as little as possible in the internal affairs of its colonies, and, above all, as little as possible with their pockets. The policy of the noble lord (the member for the city of London) was the right and statesmanlike one;—sell your land to the colonists and have done with it. Signeuries and royalties are relics of feudalism, wholly unsuited to colonies. Their establishment is another instance of the utter ignorance of men and things which the Colonial Office generally displays in its administration of the colonies; and, to crown the absurdity, the emigration commissioners report that these royalties are, at present, not worth collecting in South Australia.

Swan River, alias Western Australia, has a delicious climate, much good land, plenty of coal, and is well situated for commerce; it might have proved a flourishing colony by this time, but it was overlaid at its birth by the Colonial Office. Its expenditure exceeds its income; and we have to pay seven or eight thousand pounds a year for its civil government.

Lastly, New Zealand. I do not know the rate of expenditure per head of the population of thatExpenditure in New Zealand.colony. Its expenditure, however, far exceeds its income. We annually vote between twenty and thirty thousand pounds a year for its civil government, exclusive of the bill which we shall have to pay for Maori wars. In the course of the last two years, we have voted that £236,000 shall be lent to the New Zealand Company, which I hope will be repaid some day or other. In that colony, what with imbecile governors in the beginning, what with constitutions proclaimed and suspended, what with quarrels with the natives, what with missionaries and land-sharks, there has been a state of the most extraordinary confusion; yet, I believe, through the indomitable energy of our race, New Zealand will ultimately become a flourishing colony, the Britain of the Southern Seas. The House may remember that in 1846 the Colonial Office imagined a nondescript constitution for New Zealand, and sent it off post-haste to that colony. It was to divide New Zealand into two provinces—New Ulster and New Munster. Each was to have a representative assembly. When the constitution arrived, Governor Grey refused to bestow it on New Ulster, on the grounds that it would enable the British population to legislate for and tax the natives. Therefore Governor Grey suspended the constitution of New Ulster till he could receive further instructions; but he expressed his opinions in very strong terms that the inhabitants of New Munster were fit for a constitution. When this intelligence reached the Colonial Office, Lord Grey immediately proposed to Parliament a Bill (which was passed about three or four months ago) to suspend the constitution of both provinces. Now I infer, from late accounts from the colonies, that New Munster has obtained its constitution; and perhaps its representatives will be assembled, and will be hard at work legislating, when orders will arrive from England to suspend their constitution, and to dismiss them with ignominy. A curious farce is the history of the management of this colony by the Colonial Office. This same nondescript New Zealand constitution was sent by the Colonial Office to New South Wales for the colonists to inspect, and to see how they would like a similar one. They have rejected it with scorn and contempt. I am afraid, sir, that the present Secretary of State for the Colonies, notwithstanding his very great abilities, will not be renowned in future history as either the Solon or Lycurgus of Australia.

I think I have sufficiently established my position that, in every portion of the globe, the British colonies are more economically and better governed in proportionConclusions.as they are self-governed. In North America the various states of the Union govern themselves twenty-five per cent. cheaper than the Canadas do, which are to a certain extent under the control of the Colonial Office. In the West Indies the Crown colonies, which are governed by the Colonial Office, are twice as heavily taxed as the plantations; and in Australia, and in the Mediterranean, the same rule holds good. These facts justify the conclusion at which I now arrive, that the greater the amount of local self-government, and the less the Colonial Office interferes in the internal affairs of the colonies, the more economically and the better the colonies will be governed. In the course of the last ten years petitions, complaining of Colonial Office government, and praying for representative government, have been presented from the Cape of Good Hope, New South Wales, Van Diemen's Land, Western Australia, South Australia, New Zealand, British Guiana, Trinidad, St. Lucia, and Malta. The prayer of only one of these petitions has been acceded to. New South Wales has obtained a mongrel form of representative government, which must soon be amended, though not in the fashion proposed by the Colonial Office. All the other petitions have been rejected. Now I do not assert that each of these colonies would derive the same amount of benefit from free institutions; but I am prepared to maintain that with representative government every one of them, not excepting the Mauritius, would have been more economically and better governed than they have been or are governed by the Colonial Office.

In saying this I do not mean to speak with disrespect either of past or present Secretaries of State for the Colonies; but there is no essential difference between them; the system is throughout the same, whoever may be the nominal chief. Of that system, however, I do intend to speak with disrespect; and I can quote, in justification of my so doing, some high authorities on this side of the House, who have carefully studied the subject. I mean my honourable friend the member for Liskeard (Mr. C. Buller), the honourable gentleman the member for Sheffield (Mr. Ward), and the noble earl at the head of the Colonial Office, before he became Secretary of State for the Colonies. As long as that system exists, the majority of the colonies must be ill-governed, and their inhabitants discontented; for the Colonial Office undertakes to perform an impossible task. It undertakes the administration, civil, military, financial, judicial, and ecclesiastical, of some forty different communities, with various institutions, languages, laws, customs, wants, and interests. It undertakes to legislate more or less for all these colonies, and altogether for those which have no representative assemblies. It would be difficult enough to discharge all these functions in a single office, if all the colonies were close together and close to England, but they are scattered over the surface of the globe, from the Arctic to the Antarctic pole. To most of them several months must elapse, to some of them a whole year must elapse, before an answer to a letter can be received, before a petition can be complied with, or a grievance redressed. Therefore, orders which are issued from the Colonial Office in accordance with the last advices from a colony are, in innumerable instances, wholly unsuited to the state of the colony when the orders arrive; in some cases, questions which time has settled are reopened, forgotten disputes are revived, and the tardy interference of the Colonial Office is felt to be a curse even when a wrong is redressed. In other cases, the instructions of the Colonial Office are wisely disregarded by the governors, or rejected with derision by the colonial assemblies, who marvel at the crass ignorance of their transatlantic rulers.

In addition to its other arduous functions, the Colonial Office is required to assist in the vain attempt to suppress the slave trade with Africa; and it has likewise the difficult task of administering a secondary punishment in a penal colony at the antipodes. Now, if it were possible for any mortal man to discharge the duties of such an office, it is evident that he ought to possess, not merely great mental powers, but a long and intimate acquaintance with the affairs of the different colonies; he should be brought up to the business, it should be the study of his life, and he should be appointed on account of his special aptitude to conduct such business. Is this the rule for selecting Secretaries of State for the colonies? Nothing of the kind. They are generally chosen haphazard from the chiefs of the two great political parties in this or the other House of Parliament; and they retain their office, on the average, some eighteen months or so. During the last nine years there have been no less than six Colonial Secretaries—namely, Lord Glenelg, Lord Normanby, Lord John Russell, Lord Stanley, Mr. Gladstone, and Lord Grey. All of them, I acknowledge, are men of great ability; all of them, I believe, most anxious to use their abilities for the benefit of their country and of the colonies; but I feel persuaded that one-third of them had little or no acquaintance with colonial affairs prior to their acceptance of office. Just, therefore, as they were beginning to learn the wants and interests of the more important colonies, and to acquire the first rudiments of colonial lore, they were succeeded by some other statesman, who had to commence his lessons as Secretary of State for the Colonies, and to try his hand in the despotic and irresponsible government of some score or so of dependent states.

In fact, the Colonial Government of this country is an ever-changing, frequently well-intentioned, but invariably weak and ignorant despotism. Its policy varies incessantly, swayed about by opposite influences; at one time directed, perhaps, by the West India body, the next instant by the Anti-Slavery Society, then by Canadian merchants, or by a New Zealand Company, or by a Missionary Society: it is everything by turns, and nothing long; Saint, Protectionist, Free-trader, in rapid succession; one day it originates a project, the next day abandons it; therefore, all its schemes are abortions, and all its measures are unsuccessful. Witness the economical condition of the West Indies, the frontier relations of the Cape of Good Hope, the immoral state of Van Diemen's Land, and the pseudo-systematic colonization and revoked constitution of New Zealand.

Such a government might suit serfs and other barbarians; but to men of our race, intelligent and energetic Englishmen, accustomed to freedom and to local self-government, it is one of the most hateful and odious governments that can well be imagined. It is difficult to express the deep-seated hatred and contempt which is felt for the Colonial Office by almost every depèndency subject to its sway. If you doubt this fact, put the question to the West Indies and the Mauritius; put the same question to Van Diemen's Land, to New South Wales, to New Zealand, and your other Australian colonies; from all of them you will receive the same answer, and the same prayer to be freed from the control of the Colonial Office. Even the Canadas are not content, though they have responsible government; and though, in most respects, they are virtually independent of the Colonial Office; yet every now and then the Colonial Office contrives to produce irritation by stupid interference in some question of minor importance, such as the regulations of a banking-bill, or the amount of a petty salary.

Though the colonies have ample reason to complain of the manner in which their affairs are administered by the Colonial Office in this country, they have still greater reason to complain of the governors and other functionaries who are sent by the Colonial Office to the colonies; for, generally speaking, they are chosen, not on account of any special aptitude for, or knowledge of, the business they will have to perform, but for reasons foreign to the interests of the colonies. For instance, poor relations, or needy dependents of men having political influence; officers in the army or navy, who have been unsuccessful in their professions; briefless barristers; electioneering agents; importunate applicants for public employment, whose employment in this country public opinion would forbid; and at times, even discreditable partisans whom it is expedient to get rid of in the colonies; these are the materials out of which the Colonial Office has too frequently manufactured its governors and other functionaries. Therefore, in most cases, they are signally unfit for the duties which they have to perform, and being wholly ignorant of the affairs of the colony to which they are appointed, they become the tools of one or other of the colonial factions; whence perpetual jealousies and never-ending feuds. The governors, the judges, and the other high functionaries are generally on hostile terms. The governors amove the judges, the judges appeal to us for redress; every year a petition or two of this kind comes under the consideration of Parliament. To settle such questions the Colonial Office has just created a new tribunal, composed of an ex-Indian judge and railway commissioner, and of an ex-permanent Under Secretary of State for the Colonies; the one with little knowledge of colonial affairs, the other famed for years as the real head of the colonial system, and, therefore, reputed to be the evil genius of the colonies. It would be easy to cite instances which have occurred during the last ten years which would illustrate every one of these positions. I forbear, however, from mentioning names, as the facts are notorious to every one who has taken any interest in colonial affairs.

It is no wonder that the colonies are discontented, and that they are badly and expensively governed. Is there any remedy for this state of things? I have traced the evil to its source in the colonial system of the Colonial Office. Can that system be amended? It appears to me that the Colonial Office, as an instrument for governing the colonies, must always be far inferior to any mode of self-government by the colonists; for it is evident that at least in ninety-nine cases out of every hundred, the colonists—the men on the spot—must be better judges of their own interests than honourable gentlemen far away in Downing Street can possibly be. It is evident, likewise, that, though the empire at large has a deep interest in the good and economical government of the colonies, though all of us here present are most sincerely desirous that the colonies should be contented and happy, yet we have other things to do besides studying colonial affairs and looking after the Colonial Office; therefore, the Colonial Office is virtually irresponsible. It may play what pranks it pleases; it is only when we have to pay for a Canadian insurrection, or a Kaffir war, that an outcry is raised, and the Colonial Office itself is called to account, and then there is not above a score of us who know anything about the subject, even after a laborious study of the documents carefully prepared for the purpose by the Colonial Office. Remember, likewise, that implicit reliance cannot be placed on those documents. Some, for instance, are long didactic despatches, written for the sole purpose of being presented to Parliament, not intended to produce any specific results in the colonies, but full of well-turned periods, containing lofty sentiments and apparently statesmanlike views, calculated to gain credit for the office, and to satisfy the minds of honourable, ignorant, and confiding members, who soon afterwards forget all about the matter. Again, as a collection of materials for enabling the House to form a judgment with regard to colonial affairs, those documents are not to be trusted, for, generally speaking, they are tainted with partiality, and necessarily so, because they are selected out of a vast mass, on account of their supposed importance. Of that importance the Colonial Office is the sole and irresponsible judge: it determines without appeal what shall be produced and what shall be suppressed. In so doing, it must obey the unchanging laws of human nature, and attach greater importance to those documents which confirm its views, and less importance to those which are adverse to its opinions. The former, therefore, obtain its special care, and are sure to be produced; the latter are comparatively neglected, and liable to be forgotten and suppressed; the result is inevitable, namely, partial statements; instances of human fallibility, affording incontestible proofs of the impossibility under which this House labours of forming a correct judgment with regard to colonial affairs. For similar reasons the Colonial Office labours under a similar difficulty, because the statements made to it by the colonial authorities must frequently be of a partial character, and at times wholly untrustworthy; yet always months, and sometimes whole years, elapse before any explanation of those statements can be obtained. Therefore ignorance and irresponsibility are the characteristic defects of our present mode of governing the colonies. For these defects there is no remedy but local self-government.

Hence I come to the conclusion, that we should delegate to the colonies all powers of local legislation and administration which are now possessed by the Colonial Office, with the reservation only of those powers the exercise of which would be absolutely inconsistent with the sovereignty of this country, or might be directly injurious to the interests of the whole empire. It appears to me that the powers that ought to be so reserved are few in number, and could easily be defined. To determine them, it would be necessary merely to consider what are the benefits which this country may derive from the colonies, and what is requisite to secure the continuous enjoyment of those benefits.

Colonies are useful either as affording markets for our produce, or outlets for our population. To prove their utility as markets, my honourable friend the member for Liskeard, in his most able and admirable speech, in 1843, on systematic colonization, showed that the rate of consumption of British produce and manufactures, per head of the population, was very much greater in colonies than in other countries. Of the correctness of this position there can be no doubt. In 1844, continental Europe, with a population of about 220,000,000 of inhabitants, did not consume more than £24,000,000 worth of our produce and manufactures; whilst our colonies (including the United States), with a population not exceeding 25,000,000, consumed £16,000,000 worth of our goods. Therefore, while the rate of consumption of our goods did not exceed 2s. 2d. a head in continental Europe, it amounted to 8s. a head in the United States, and £1 12s. a head in our other colonies. It must, however, be admitted, that a considerable portion of our trade with our subject colonies consists of goods sent to defray the cost of our establishments there. Making, however, every fair deduction on that account, still it cannot be denied that they are excellent markets for our goods. It is very unfortunate, therefore, that they cost us so much as 16s. a head of their population for government and defence, as that sum must absorb the greater portion of, if not all, the profit of our trade with those colonies.

To show the utility of colonies as outlets for our population, I may refer to the reports of the emigration commissioners, from which it appears that, in the course of the last twenty years, 1,673,803 persons have emigrated from this country, of whom 825,564 went to the United States, 702,101 to the North American colonies, 127,188 to the Australian colonies, and 19,090 to other places. It would be interesting to know what has been the cost of this emigration, and how it has been defrayed. I cannot put it down at less than £20,000,000 sterling, of which about £1,500,000 were paid out of the proceeds of land sales in the Australian colonies. This emigration has varied considerably in amount from year to year; from the minimum of 26,092 persons in 1828, to the maximum of 258,270 persons last year. If averages of five years be taken, it appears to have gone on steadily increasing in amount; for on the average of the five years ending with 1832, it amounted to 60,000 persons a year; ending with 1837, to 66,000 persons a year; ending with 1842, to 86,000 persons a year; and ending with 1847, to 121,000 persons a year. Therefore the habit of emigrating is confirmed, and becoming more powerful every day; and therefore colonies are becoming more useful as outlets for our population.

Therefore, free trade with the colonies, and free access to the colonies, should, in my opinion, be the sole end and aim of the dominion which Great Britain still retains over her colonies. By keeping these two objects distinctly in view, by bestowing upon the colonies all powers of local legislation and administration which are not absolutely inconsistent with these objects and the sovereignty of this country, I believe that our colonial expenditure might be greatly diminished in amount, and that our colonial empire would flourish and become of incalculable utility to this country.

I do not propose to abandon any portion of that empire. I only complain that it is so little use to us; that it is a vast tract of fertile desert, which costs us £4,000,000 sterling a year, and yet only contains a million and a half of our race. Would it not be possible to people this desert with active and thriving Englishmen? To cover it with communities composed of men with wants, habits, and feelings similar to our own, anxious to carry on with us a mutually beneficial trade? In this country, every trade, every profession, and every branch of industry, are overstocked; in every quarter there is a fierce competition for employment. On the contrary, in the colonies there is an equally fierce competition for labour of every kind. Now, is there any mode of bridging over the oceans that intervene, so that our colonies may be to the United Kingdom what the backwoods are to the United States? If such a plan could be devised, if it could be carried into execution, it might tend to solve the most difficult economical problems of England and of Ireland.

To carry such a plan into execution, two things would be requisite. First, funds wherewith to convey the poorer classes to the colonies. How could such funds be obtained? The honourable gentleman the member for Sheffield, the honourable gentleman the member for Gateshead, and my honourable friend the member for Liskeard, have, in their numerous and able speeches upon this subject, told us that sufficient funds could be obtained by the sale of waste lands, according to the wellknown plan of Mr. Wakefield. I hold the same opinion. I firmly believe that, with continuous and systematic emigration, sufficient funds could be so obtained. But I will suppose, for the sake of argument, that they must be obtained, for the present, from some other source. Now, I ask the House to consider, first, that we spend £4,000,000 sterling a year in the colonies on army, navy, ordnance, commissariat, Kaffir wars, Canadian rebellions, and the like; secondly, that for half £4,000,000 (the sum which I propose to save by a reduction of colonial expenditure) we might send annually to Australia 150,000 persons, and to Canada twice that number. I ask the House, at the expiration of ten or fifteen years, from which of these two modes of expending the public money would the nation derive the greater benefit? Our army, navy, and ordnance cost us at present from six to seven millions sterling a year more than they did in 1835, when their force was ample for the defence of the empire. What have we to show in return for this enormous increase of expenditure? A Canadian insurrection suppressed, a Kaffir war terminated, barren trophies in India, the gates of Somnauth, Hong Kong, Labuan, and the Falkland Islands. What should we have had to show for it had only a portion of it been expended on colonization? A third part of it (the £2,000,000 a year, which I affirm can be spared from our colonial expenditure) would have been sufficient in ten years to double or triple the British population of our colonial empire.

For instance, that sum would in ten years have conveyed a million and a half of our fellow-citizens to Australasia; where the climate is so peculiarly suited to our race, where abundance of food can easily be obtained; there, flourishing and contented, they would have been anxious to purchase our produce and manufactures; wealthy states, worthy of the British name, would have been generated, carrying on with us an enormous trade; self-governed, they would have needed neither army nor navy to protect them, and would have gladly defrayed every local expense. That would have been a colonial empire to boast about!

Again, the same sum of £2,000,000 sterling a year would, in ten years, have conveyed to North America some three millions—say, of Irishmen. With that sum I believe you might have created beyond the Atlantic a new and happy Ireland, so attractive to the Celtic race that they would have migrated in shoals from the old and unhappy Ireland, and thus, perhaps, have enabled you to solve that fearful problem, which neither gagging bills, nor coercion bills, nor alien bills, nor even a repeal of the union will ever solve. That, indeed, would have been a feat for a great statesman to accomplish, and would have covered his name with immortal renown! I do grudge the £4,000,000 a year which we squander upon our colonies, when I consider what might be done with half that sum for the benefit of this country, and of the colonies by means of systematic colonization.

But to colonize beneficially, it is necessary that the higher and richer, as well as the poorer classes, that the employers of labour as well as the employed, that all classes of society, should migrate together, forming new communities, analogous to that of the parent state. On such principles alone have successful colonies been founded in ancient or modern times. On such principles the colonies of Greece and of New England were founded.

For instance, from the overcrowded cities of Greece the colonists departed under the guidance of their foremost men; they carried along with them the images of their heroes and their gods, whose common worship linked them for ever to their ancient home; arrived at their destination, they formed states after the model of the parent city; they flourished in wealth, excelled in all the arts of civilized life, extended the empire, and added to the renown of the Dorian or Ionian name. Not dissimilar in principle was the old English mode of colonizing, except that our colonies, instead of commencing their existence as independent states, professed their allegiance to the mother country; but their charters gave them all the essential powers of self-government, and complete control over their internal affairs. They flourished rapidly, were most loyal, and sincerely attached to our empire, till we drove them into just rebellion by our new colonial system. Very different from these successful modes of colonizing has been that of the Colonial Office. It has been either a shovelling out of paupers or a transportation of criminals, whereby some of the fairest portions of the British dominions have been converted into pest-houses of pauperism, or sinks of iniquity, polluting the earth with unheard-of diseases and unmentionable crimes. No gentleman, no man of birth or education, who knows anything about the matter, would ever think of emigrating to a colony, to be under the control of the Colonial Office. But if the colonies were properly planted, and self-governed according to the old fashion, then our kinsmen and friends, instead of overstocking the liberal professions, instead of overcrowding the army and navy, where no career is open for them, would seek their fortunes in the colonies and prosper; for we are by nature a colonizing people. The same destiny that led our forefathers from their homes in the farthest east, still urges us onwards to occupy the uninhabited regions of the west and the south; and America, and Australia, and New Zealand anxiously expect our arrival to convert their wastes into happy abodes of the Anglo-Saxon race.

In making these observations I wish merely to show, that if vast sums of money are to be expended on the colonies, they can be expended in a manner far more beneficial to the interests both of the colonies and of the rest of the empire than they have been hitherto expended. I do not, however, intend to propose to the House any plan of systematic colonization, or any grant of public money for that purpose. My only objects, at present, are reduction of useless expenditure, and reform of bad colonial government, which are things good in themselves without reference to any ulterior measures. But I will presume to express my belief that there is a great and noble career open for any statesman who, possessing the power, shall, with firm and vigorous determination, curtail that expenditure, reform that system of government, and, at the same time, promote systematic colonization. In what manner colonial expenditure can be curtailed without detriment to the interests of the empire, in what manner the system of colonial government can be amended for the benefit of the colonies, I have attempted to show; and in the hope that I have succeeded in proving that that expenditure ought to be curtailed, and that system of government ought to be amended, I take the liberty of moving the resolution:—‘That it is the opinion of this House that the colonial expenditure of the British Empire demands inquiry, with a view to its reduction; and that to accomplish this reduction, and to secure greater contentment and prosperity to the colonists, they ought to be invested with large powers for the administration of their local affairs.’ And if the Government will accede to this motion, I give notice that next session I shall follow up this subject by moving for a committee of inquiry.

III.—

THE PRUSSIAN ZOLLVEREIN IN 1840
By Richard Cobden

This remarkable letter, which has never been reprinted since its publication in the Anti-Corn-Law Circular, testifies to the statesmanlike sagacity of the leader of the Manchester School and contrasts with the narrow ignorance that has so often dominated our Foreign Office especially in regard to commercial movements abroad. The customs laws of Prussia were consolidated and simplified in 1818, and ten years later Hesse-Darmstadt joined the Prussian Union, to be followed in 1833 by Bavaria and Würtemberg and (reluctantly) by Saxony and the smaller states. The formation of the Zollverein was in itself, as Cobden saw, very advantageous not only to Germany but to all countries which traded with her, the customs tariff being lower than most of the separate tariffs which previously existed in thirty-eight different states and cities. His prediction that tariff reductions in England would lead to a more liberal policy in Germany was also verified, and for many years Germany became one of our principal sources of food supply, sending us in 1877 no less than 7,000,000 cwt. of wheat and flour. And at the present time the empire of Germany appears among the three or four best customers of British manufactured goods.

Seventh letter from a member of the Anti-Corn-Law League, on the Continent.

Frankfort,

Thursday, October 22^nd, 1840.

The Prussian Commercial Union.

On leaving Basle to come by land to this city, I found myself within the territory of the German Union, commonly called the Prussian Commercial Union. Before the revolutionary wars Germany was divided into more than three hundred independent states and upwards of fifty-three free cities, all enjoying the privileges of so many distinct sovereignties. The greater part of these were swept away by the tempest of the French revolution. Germany, however, still contains thirty-eight independent states, eighteen of which have less than 100,000 inhabitants each. Until the recent formation ofEnlightened commercial policy of Prussia.the Commercial League, these states were allied only by a union of the governments under the name of the German Confederation, whilst the intercourse of the people was obstructed by separate custom house regulations, and travellers were liable to be searched, several times in the course of a day's journey, at the frontiers of these insignificant territories. But, thanks to the enlightened labours of Prussian statesmen, these impediments no longer exist. From the confines of the Tyrol to the shores of the Baltic, and from the frontiers of Belgium to the borders of Russia, no custom house or duties now obstruct the free course of trade, or the progress of the traveller.

Much misapprehension still exists in England as to the nature and objects of the Prussian Commercial League. Whilst in the course of formation, this union was held up to the jealousy and dislike of the British people, as having been conceived in a spirit of hostility to their commercial interests. Our ministers were frequently questioned in parliament upon the subject, and, amongst other efforts of a similar kind, our representative here was instructed to exert hisJealousy of the Zoliverein in England.influence (which he did, but of course unsuccessfully) to prevent these free cities from joining the league. The policy of our aristocracy has always been to divert the attention of the people from the evils arising from their own selfish laws. The same legislators who have dammed up a thousand streams of commerce by their Corn Law, are ever ready with the offers of their services to remove some alleged impediment to our trade abroad.

The motives which influenced the authors of the League may be easily understood from the preamble of the treaty of 1833, which begins thus: ‘The contracting powers, penetrated with a lively solicitude for whatever may contribute to the freedom and extension of commerce and industry in their respective states,’ etc. And the first article gives a sufficient explanation of the objects contemplated by the treaty—

‘Article I.—The various associations of custom houses, already existing in the said states, shall for the future form, by virtue of a common system of custom houses and of commerce, a general association, which shall include all countries comprised in such associations.’

Whatever other motives may have influenced the Prussian cabinet, no rational mind now believes that it was actuated by any feelings of hostility to British interests. It has been surmised, and very plausibly, that in putting herself at the head of a commercial union, Prussia sought to acquire a political influence among the German states, to counteract the ascendancy which Austria (not included in the League) possessed as the acknowledged head of the German confederation. The question of importance, however, to you and to your readers is, what will be the probable effects of this union of upwards of 26 millions of people within one line of custom houses upon the interests of the British Empire? Can we increase our commerce with these rich and cultivated nations, and how? In the course of my travels on a latePossible extension of British commerce with Germany. occasion in every part of the union, I made especial inquiries upon the latter point, and the result was a confirmation of the opinion given by Doctor Bowring, that with a modification of our own Corn Laws, we may insure a reciprocal reduction of the duties upon British goods, and a proportionate extension of our commercial relations with the countries of the League. My inquiries extended to individuals of every class—to those who are interested in trading with us, and those who would benefit by shutting us out—to the agriculturists of Prussia and Bavaria, the manufacturers of Saxony and Westphalia, and the merchants and bankers of Frankfort, and I have found the unanimous opinion of intelligent men to be that we have the power in our own hands of lowering the tariff upon our manufactures in Germany, and they uniformly pointed to a reduction of duty upon corn as the indispensable preliminary to any modification of the duties upon our commodities.

Being one of those who composed the Anti-Corn-Law deputation that waited on Lord Melbourne in the spring, I have not forgotten the easy assurance with which the pleasant premier delivered his opinion, that there was no chance of increasing our trade with the countries of the German League. In the course of a conversation yesterday, with one of the public men here, he reminded me of his lordship's characteristic sally, and observed, shrewdly enough, that it was a pity he did not arrive at that conclusion before sending Doctor Bowring, at some expense, to Berlin to bring back a contrary opinion. ‘If his lordship will give me a carte blanche,’ said he, ‘upon the corn question, I will undertake to secure to the English manufacturers a vast extension of their trade with Germany.’

The most conclusive proof, however, that the people of Germany would be glad to extend their commercial relations with us, is to be found in the simple fact that it is their interest so to do. The principal states of the League, as Prussia, Bavaria, Baden, Wurtemberg, etc., are agricultural rather than manufacturing. In Prussia the agricultural population are to the manufacturers as more than five to one; and of the 26 millions of people contained in the Commercial League, nearly 17 millions are dependent on agriculture. The benefits derived from the present high protecting duties upon manufactured goods fall principally to the lot of Saxony; but it is not reasonable to suppose that the other States would voluntarily and gratuitously sacrifice themselves for the benefit of one of the members of the Union; more especially as it was no part of the original design of the League to levy high duties for protection. The duty originally put upon cotton manufactures, for instance, was 10 per cent. only; but, as it is levied by weight, and not ad valorem, the diminished value of the goods has raised the duty in some instances to 70 or 80 per cent. Any negociation for increasing our commerce with this important Union must be addressed to the Government of Berlin, which has every motive for meeting us in the most amicable spirit. Her Polish provinces, now so much behind the rest of Prussia in wealth, intelligence, and civilization, would derive peculiar and incalculable benefits from a trade in corn with England. With a repeal of our corn law, indeed, Pomerania might speedily become the most valuable of the Prussian provinces, yielding, as it does in the greatest abundance, the finest wheat in Europe. The Prussian ports on the Baltic would be the scene of an active commerce in corn, in which native vessels might be expected to share largely; and Dantzig would undoubtedly become the Liverpool of the corn trade. With these paramount motives for extending its commercial relations with England, we may feel certain that so wise a Government as that of Berlin would gladly embrace the opportunity of effectingBut dependent on repeal of corn laws. such an object. But the sine qua non of any such arrangement must be the repeal or modification of our corn law. It is folly to attempt to enlarge our trade with the countries of northern Europe, unless we are prepared to take in payment for our manufactures their staple product—grain.

Whatever may be its ultimate effect upon the interests of foreign countries, the union of the Germans within one line of custom houses is calculated for the almost unmixed benefit of the people. Speaking one language,Peaceful formation and beneficial ends of the Zollverein. and having a uniformity of weights and measures, and of money (the latter are now in course of assimilation), they will form, for almost all practical and beneficial ends, one nation. This union is the first in the annals of empires that has been formed exclusively for the promotion of the material interests of the people; formed, too, peaceably, and without even the intervention of diplomatic intrigue. Unlike most other instances of the amalgamation of European territory, the claims of legitimacy, or the lust of extended dominion, have had no share in the formation of the League; and one of its most interesting features, bearing, as it does, powerfully upon the future destinies of the Germans, is, that whereas their Commercial Union affords the strongest motive for refraining from oppression or conquest, it confers upon them a growing defensive power, which will be the best safeguard against the wanton attacks of other nations.

IV.—

ON THE PROPOSED BRITISH ZOLLVEREIN, OR COMMERCIAL UNION WITH THE COLONIES

This masterly essay was written for the Cobden Club by the late Lord Farrer in 1896, and was entitled ‘The Neo-Protection Scheme of the Right Honourable Joseph Chamberlain, Secretary of State for the Colonies.’ Lord Farrer has gladly allowed me to reprint this example of his father's work. I have edited it and brought most of the figures up to date in order that the public may have a complete Cobdenic criticism of Mr. Chamberlain's proposals. Lord Farrer (1819–1899) was Permanent Secretary of the Board of Trade from 1865 to 1886, and succeeded Mr. Potter as President of the Cobden Club.

When, in 1892, the Chambers of Commerce, British and Colonial, met in London to consider the subject of Commercial Federation of the empire, theGrowth of commercial imperialism in 1892. advocates of what was then known as fair trade had the courage to propose a definite resolution to the effect that the United Kingdom should give to the colonies preferential treatment.

That resolution was negatived by a large majority.

Since then great efforts have been made by the advocates of this new form of protection. Mr. Hofmeyr, Sir Charles Tupper, and Sir Howard Vincent have stumped the empire; congresses have been held at Ottawa, and finally, again, in London; one of our chief economic journals has devoted £1000 in prizes for the best scheme of commercial federation; and the Marquis of Lorne has been called in to give exalted sanction to the least unacceptable proposal which the ablest and most distinguished supporters of the movement could devise. Finally, our own Colonial Secretary has taken the chair at the recent Colonial and British Congress in London, and has there publicly not only intimated his own desire, and, as we must assume, that of the Government, for Imperial Protection, but has sketched an outline of such a scheme; and the Times, in its earlier and better days an unflinching advocate of free trade, has patted the Colonial Secretary on the back.

Under such a concatenation of favourable circumstances it was to be expected that our Neo-Protectionists would have made some progress. But no! At this congress in London the Canadian delegates dared to propose nothing more specific than a vague resolution in favour of an arrangement

‘As nearly as possible in the nature of a Zollverein, based upon principles of freest exchange of commodities within the empire consistent with the tariff requirements incident to the maintenance of the local government of each kingdom, dominion, province, or colony now forming part of the British family of nations.’

This resolution, which, but for the ambiguous term ‘Zollverein,’ might be accepted by a free trader, was felt by some of themselves to be too vague, and an amendment was moved to the effect that—

‘This Congress records its belief in the advisability and practicability of a customs arrangement between Great Britain and her colonies and India on the basis of preferential treatment.’

But so little did either the resolution—apparently harmless as it was—or the amendment meet the views of the assembled delegates, that the proposers of both found it necessary to withdraw them, and to substitute a perfectly meaningless resolution, to the effect that the Government should be invited to summon a conference to consider the subject.

Even Canada, which, under the leadership of Sir Charles Tupper, was the prime mover of this Neo-Protection scheme, has at this critical moment thrown off his baneful guidance, and declared herself for a ministry which is opposed to the principle of protection.

Under these circumstances it seems almost superfluous to enter at length, for the hundredth time, upon the reasons which make any such proposals as those of the Canadian delegates and of Mr. Chamberlain—for they are in effect one and the same—undesirable and impracticable. Purposely vague as they were, and consequently presenting as small a front to attack as possible, they have been felt to involve principles which the country is unwilling to accept, and have fallen through with no result except discredit to their promoters.

But as the Cobden Club are often told that they answer practical proposals by fanatical adherence to à priori dogmas, and as Mr. Chamberlain and his supporters evince complete ignorance of all that has been said upon the subject by the advocates of free trade, it may be worth while to indicate once again what are the difficulties which our Neo-Protectionists have to meet.

It may be well to quote Mr. Chamberlain's last words upon the subject. Of the resolution which he approves, and which, as I have said, was withdrawn, he speaks as follows:—

‘That resolution I understand to be one for the creation of a British Zollverein or Customs Union, which would establish at once practically free trade throughout the British Empire, but would leave the separate contractingMr. Chamberlain's scheme for a British Zollverein. parties free to make their own arrangements with regard to duties on foreign goods, except that this is an essential condition of the proposal—that Great Britain shall consent to replace moderate duties upon certain articles which are of large production in the Colonies. Now, if I have rightly understood it, these articles would comprise corn, meat, wool, and sugar, and perhaps other articles of enormous consumption in this country, which are at present largely produced in the colonies, and which might, under such an arrangement, be wholly produced in the colonies and wholly produced by British labour. On the other hand, as I have said, the colonies, while maintaining their duties upon foreign importations, would agree to a free interchange of commodities with the rest of the empire, and would cease to place protective duties on any product of British labour.1 That is the principle of the German Zollverein; that is the principle which underlies federation in the United States of America; and I do not doubt for a moment that if it were adopted it would be the strongest bond of union between the British race throughout the world. I say such a proposal as that might commend itself even to an orthodox Free Trader. It would be the greatest advance that Free Trade has ever made since it was first advocated by Mr. Cobden to extend its doctrines permanently to more than three hundred millions of the human race, and to communities many of which are amongst the most thriving, the most prosperous, and the most increasing in the world. On the other hand, it would open up to the colonies an almost unlimited market for their agricultural and other productions.’

Let us begin by stripping these proposals of their rhetorical exaggerations. It is all very well to talk of extending freeExaggerations involved in this statement.trade to more than 300 millions of people, and of opening up to the colonies an almost unlimited market. But what are the facts? Let us assume—it is not far from the truth—that the population of the British Empire is about 300 millions. But it is not the population of the British Empire whose markets would be opened, or to whom free trade would be extended, under Mr. Chamberlain's proposals. The markets of the 40 millions who inhabit the United Kingdom are already open to the colonies. The markets of the 250 millions who inhabit India are also open. The markets of the Crown Colonies and of other dependencies are also open, so far as their several circumstances will permit. In none of these cases is there any protective principle, any interferences with free trade, which Mr. Chamberlain's scheme would remove.

On the contrary, with regard to the whole of these vast populations—composing from 270 to 280 millions of people—Mr. Chamberlain's proposal is to close markets, not to open them; to make them adopt a system which will shut out foreign goods and deprive them pro tanto of foreign markets for their own produce.

The only cases in which Mr. Chamberlain's proposal will open markets are the cases of those self-governing colonies which, in the exercise of the freedom they enjoy, have adopted protective systems against one another, against the rest of the empire, and against the world. As regards these, Mr. Chamberlain's proposal would, if accepted, open their markets to one another and to the rest of the empire, but would close them or keep them closed to the rest of the world.

Let us understand what this would amount to.

The whole population of the self-governing colonies, according to the last statistical abstract, is as follows, viz:—

Let us say 12 millions out of 300 millions, or about 1/25th of the population of the empire. So far as the opening of markets goes, it is from these 12 millions only that either the mother country or the rest of the empire can hope to derive any benefit by Mr. Chamberlain's scheme.

Now let us see what his scheme amounts to.

Put into plain words, it means—

First, that this country shall place protective and preferential duties, as against all foreign countries, upon all such articles of food and raw material asMeaning of Mr. Chamberlain's proposals. are produced in the colonies; these duties to be of such an amount and character as to secure to the colonies the exclusive possession of the markets of the United Kingdom.

Secondly, that the colonies shall maintain protective duties upon foreign goods, but shall maintain no protective duties on any goods produced within the British Empire.

Let us consider the effect of these two propositions. In the first place, as regards both of them, they involve a sort of commercial treaty between different parts of the British Empire, and they involve a treaty of a very peculiar kind.

All the recent commercial treaties of which we have experience are treaties by which the two parties mutually agree to take off duties on one another's goods, and thus to make an approach to free exchange. Even such treaties as these are by many of us now regarded with disfavour, and are thought to have injured the cause of free trade. They make the taking off of duties a matter of bargain; and thus create the impression that taking off protective duties is a sacrifice. But what shall we think of a treaty, one essential feature of which is, not to take off duties, but to bind each party to impose or to maintain protective duties against the rest of the world?

We have most of us heard of the mischiefs of the Methuen Treaty, which compelled Great Britain to give a preference to the heavy wines of Portugal; but what shall we say of a treaty which binds England to exclude the low-priced corn, meat, wool, and sugar of the United States, of Russia, and of Argentina, of France and of Germany, in order that she may obtain these articles at a higher price from Canada, India, Australia, and the West Indies?

Or, to look at the same question from a colonial point of view—

What shall we say of a treaty which binds Canada and Australia to buy no articles from the United States or from China which those colonies can buy, though at a higher price, from Great Britain or from India?

Let us consider the practical results which any such treaty would have on the interests of the several parties to it; and, first of all, let us consider the interests of the United Kingdom. We are asked to place now and for ever—or, at any rate, for a great number of years—a tax upon the food and raw materials which are the essence of our prosperity.Consequences to the trade of the United Kingdom. This tax must be such as to raise the cost to us of those articles above what it would otherwise have been, or it cannot have the effect which it is intended to have—namely, of keeping out foreign produce. It must therefore be a serious limitation of our present resources.

Nor is this all.

It must also be to the same extent a limitation of the markets for our own manufactures.

For if we do not buy from foreign countries, we shall not sell to them.

Now, what are we to get in return for these immense sacrifices? The late prime minister of Canada has, as already noticed, been the chief mover in this agitation. What shall we get from Canada? Increased tradeBritish trade with Canada. with Canada. To judge of the value of this we must answer the following questions, viz., What is our present trade with Canada? What proportion has it borne and what proportion does it now bear to our whole trade and to our foreign trade? And, again, what is the whole trade of Canada, and how much of it are we likely to get by the proposals now under consideration?

Our trade with Canada has been as follows1 :—

The whole trade of Canada, according to the last statistical abstract for the colonies, was as follows:—

and our share of it, according to the same return, was1 —

Our own returns of imports from and exports to Canada give slightly different results from those of Canada, as must always be the case, for various reasons, with statistics collected in two different countries. Our own returns give the following figures1 :—

So that, if we got the whole trade of Canada, as it now exists—which is, of course, a preposterous assumption—we should only get twice or three times as much trade with her as we now get, and that whole trade of Canada would be still an insignificant fraction of our whole trade.

The gain to us by any such bargain must therefore be infinitesimal. What would our sacrifice be? We are asked to put differential duties on things which Canada sends us—when they come from foreign countries. Now, what does she send us? Chiefly cattle, meat of various kinds, corn, flour, cheese, lard, butter, leather, skins, fish, fruit, and timber. In 1894 the value of these things which we had from Canada was about £11,500,000; but in the same year the value of these things which we had from all other countries was much more than £130,000,000, and the value of these articles which we imported from Canada's great rival, the United States, was more than £46,000,000. We are therefore asked to deprive ourselves of necessaries from the United States alone valued at £46,000,000, besides an immense quantity from other countries, on the empty promise that Canada's £11,500,000 will, under the encouragement given by a differential duty, grow into the larger amount.

But there is much more behind. If and so far as we cease to import from the United States, we shall cease to export to them, and we shall thus cripple our exchange with that great country. Nor is this all. The Government of the United States have both the power and the will to retaliate by imposing differential duties on our trade. If they do, it will go a great way towards ruining our trade with them. Let us see what this trade is, and compare it with the above figures of our trade with Canada.1

And in addition to the visible exports from the United Kingdom to the United States, we ought to add the invisible exports in the form of services rendered to the United States by our ships, which do most of the United States carrying trade, and these must amount to many millions.1

We are therefore asked, looking to the United States alone, to sacrifice a trade which has in forty-one years grown from £51,000,000 to much more than £115,000,000, and which constitutes 23 per cent. of our imports, and, including shipping, much more than 11 per cent. of our exports, in order to obtain a larger share of a trade which has grown in the same period from £13,000,000 to no more than £19,000,000, and which now constitutes only 3¼ per cent. of our imports and 2½ per cent. of our exports.

What sort of a bargain would this be for England?

‘But,’ it may be said, ‘if the other self-governing colonies in Australia and Africa should join, the bargain may be worthy our acceptance.’ Let us see how this stands.

Our yearly trade with these countries, on the average of the five years ending 1894, has been as follows2 :—

Compare this with the foreign trade which we are asked to sacrifice, the yearly amount of which is as follows, on an average of the same five years1 :—

But this is not all. It is not worth our while to make sacrifices to get the trade of Australia and the South African Colonies, for we have it already. Of the whole exports of those colonies, which are officially returned as amounting to £78,000,000 in 1894, £23,000,000 has to be deducted as being the home trade of the different Australian Colonies with one another. Of the remaining £55,000,000, the exports to the United Kingdom amounted to £45,000,000, and only £10,000,000 went to other countries. Again, the imports of these colonies, returned at 62½ millions in 1894, have to be reduced by 22½ millions, which represents Australian inter-Colonial trade, and of the 40 millions which remain, 30 millions were imports from the United Kingdom, and only 10 millions from the rest of the world.2

In the above comparison, India and the other British dependencies are of course excluded, because, as above stated, we control them, and there is no question of making treaties with them, and because we therefore already get from them all that free trade with them can give us.

There is much misapprehension about the proportions and the growth of our foreign and colonial trade. The maxim that the ‘Trade follows the Flag’ is made to mean a great deal more than it really covers. Because, man for man, Englishmen buy more from Englishmen than they buy from other nations, it is supposed that the trade with the self-governing colonies is much more valuable than trade with other nations, and that it grows faster. Sentiment,Comparative growth of foreign and colonial trade. even in buying and selling, goes for a great deal, and habit for more. Men buy what they have been used to buy, even in a foreign land. But profit made out of a Frenchman or a citizen of the United States is as much profit as profit made out of a Canadian. Now the real question for us, so far as the value of the trade is concerned, is not the amount of trade per man, but the aggregate amount of trade, including not only the actual amount of trade at the present moment, but the recent progress of trade, as indicating its probable future.

The following is an abstract from the valuable Tables presented to Parliament by the Board of Trade in 1891,1 with the figures continued from the Statistical Abstract and the Board of Trade returns; and in considering them it is always to be remembered that the export figures do not include our ‘invisible exports’ arising from the services rendered by our shipping, estimated by Mr. Giffen fifteen years ago as then amounting to £60,000,000. The bulk of these would have to be set down to foreign trade, and the more so because Canada with her large mercantile marine does so much of her own carrying by sea.

It will be seen from these figures that, in spite of the foreign protective tariffs which have been coming into force during the last twenty or thirty years, and in spite of our largely increased trade with Australia and India, stimulated, no doubt, by our large lendings to those countries, the volume of foreign trade has kept pace with the volume of colonial trade; that the percentage of imports and exports due to each of those two branches have fluctuated within narrow limits, and are now [1896] much what they were thirty or forty years ago; and that our colonial trade is now, as it was then, about one-quarter of our whole trade, whilst our foreign trade constitutes the other three-quarters.

This is not what those would expect who prophesy ruin and isolation in consequence of the protective policy of foreign nations. But it is what those might expect who know that duties which profess to be protective often fail to protect, who teach that nations cannot sell without buying, and who hold with the maxim of the original free traders, ‘Take care of the imports and the exports will take care of themselves.’

Is it, under such circumstances, wise to change our policy with the object of gaining a larger share of colonial trade? Would it not be the policy of fools to sacrifice a certain three-quarters to the chance of increasing one-quarter—to restrict and cripple a business of nearly £500,000,000 for the problematical chance of increasing a business of £170,000,000?

But, we are told, the proposed differential duty will be so small that it will not affect price. Our bread and our meat, our wool, and our sugar, will be as cheap as ever.Effect on prices. It is the old protectionist story, which we have heard a thousand times. But it passes even Mr. Chamberlain's cleverness to show how a differential duty can have the effect of shutting out foreign goods except by affecting price—i.e. by making prices higher than they would have been if there had been no differential duty. If the duty does not affect price it cannot have the desired result of shutting out foreign goods.

Moreover, it has been said by an authority, which is now classical,1 that, ‘among the other evils of the restrictive orProtection means prohibition, and is insatiable.protective system, not the least is, that the artificial protection of one branch of industry, or source of production, against foreign competition, is always set up as a ground of claim by other branches for similar protection; so that, if the reasoning upon which these restrictive or prohibitory regulations are founded were followed consistently, it would not stop short of excluding us from all foreign commerce whatsoever.’2

And it is equally true that, whilst no protective duty ever began except on the specious plea that it should be small, the fact is that it has always ended in being heavy, complete, thorough, and onerous. If these things were true in 1820, they are much more certain now. They make up the recent story of protection in France, in Germany, and in the United States: and so it must always be where the principle of protection is once admitted. You cannot make a stand at 3 per cent., or 5 per cent., or 10 per cent, or 20 per cent. If your small duty is not sufficient to exclude and protect you must increase it until it is; and if you apply it to one article you must apply it to all. Protection is insatiable, and its progress never ceases until it becomes universal exclusion.

Now let us look at the proposal from the colonial point of view.

The colonies, Mr. Chamberlain assumes, are to maintain their respective duties upon foreign goods, but they are to interchange freely with the rest of the empire, and to place no protective duties on any product of British labour.

It is generally admitted that most of the colonies must raise a large part of their revenue by customs duties, since it is impossible for them to raise sufficient revenue by direct taxation. Now it does not seem to have struck Mr. Chamberlain that it is perfectly impossible to distinguish between a duty imposed on any article for purposes of revenue and a protective duty on the same article, except by the means employed in this country—namely, by alsoConsequences to the colonies. imposing upon the same article, if made within the country, an excise duty corresponding to the duty on importation. If, for instance, we had no excise duty on home-made spirits, the duty on foreign spirits would at once be protective to the English distiller. Under the proposed scheme the colonies, who, it is admitted, must raise a large part of their revenue by customs duties, would have to admit articles of British production free from protective duties, whilst at the same time imposing protective duties on foreign articles. How, under such circumstances, would it be possible for them to maintain the freedom of all British produce by imposing an excise duty on their own home-made articles and at the same time to maintain a protective duty on the same articles when imported from foreign countries?

Let us suppose, for instance, that steel rails (or any other article) are made in Canada, in Great Britain, and in the United States, and that steel rails are articles on which Canada must raise a duty. How is Canada at the same time to keep up her revenue, to admit steel rails from Great Britain free from protection, and to maintain protective duties against United States rails?

I believe the problem to be wholly insoluble.

Let us look at the proposal a little further.

The colony, it is assumed, must still raise a revenue by its duties, which must be such as, at the same time, to shut out the foreign article and to admit the British article. The British article, therefore, must pay a much smaller duty than at present, while the foreign article will be excluded. The article which pays little or no duty will possess the market; the article which pays a considerable duty will be excluded. Will the colony under such circumstances be able to raise sufficient revenue?

We shall all agree with Mr. Chamberlain that it would be a most desirable consummation to have no duties on BritishFree trade within the British Empire.goods throughout the empire, or no duties which operate so as to protect one part of the empire against the rest. But, alas! this goes farther than the most ardent free traders have expected—farther than will probably, for generations to come, be practicable. All that we hope for is to see some approximation to such a consummation. To treat it as practicable, either at once or within any measurable time, is out of the question, for various reasons.

In the first place, it is, as above stated, impossible to distinguish between a duty imposed for revenue purposes and a protective duty, unless a corresponding excise tax is imposed. The colonies must, for some time at any rate, raise revenue by duties, and these duties can hardly fail to be, to some extent, protective. Again, no reasonable free trader wishes to see a system of protection which has been in force for many years, and under which industries of various kinds have grown up, abolished at a single blow. Such a step would be both unjust and unwise. What free traders desire is a much more moderate and a safer course. They wish to see the colonies abandon protection as a theory, and gradually reduce the most obnoxious of their present protective duties. This would probably, by increasing importation itself, increase revenue, and make further reductions possible. Gradually the colonies would thus approach, and ultimately attain, the state of things which obtains in the United Kingdom, without undue sacrifice of revenue, and without injustice to existing interests. But it is out of the question to do this except cautiously and by degrees, as, indeed, it was done in this country. This is what we may hope for under the new régime in Canada.1

But, it may be said, these are material interests—of the earth, earthy; and there are others to which it may be right that material interests should give way. There is National Defence; there is National Pride; there is the sentiment of a world-wide Empire; and the desire to spread theSome political and sentimental considerations. British name and the British language and British institutions over the face of the globe. Subtracting from these high-sounding words whatever element they may contain of aggressive Jingoism, of Jingoism which goes far to work retaliation in kind, there remains enough in them to move the blood, and even to lead captive the sober reason. Freedom itself may be appealed to, for freedom of trade is only one part of freedom, and not the most important. Freedom of thought, freedom of social and political action, are even more essential to general welfare than freedom of trade, and if these conflict with freedom of trade, it is freedom of trade which must give way. For this reason I dissent altogether from the late Lord Grey, who, in a recent pamphlet, regrets that in giving self-government to the colonies we did not compel them to adopt our own free-trade policy. The founders of the United States, aided as they were by geography, introduced freedom of trade throughout the union, and have by so doing established the widest area of free trade the world has ever known. But the facts of geography and of history which rendered it impossible in the last century for England to introduce her fiscal and commercial rules into New England, also rendered it impossible for her, when in the present century she gave self-government to her colonies, to compel them to adopt her present commercial and fiscal system. When self-government was extended to Canada, Australia, and the Cape, it necessarily carried with it to each colony the power to determine their own systems of taxation, of revenue, and of commercial policy.

Free traders are not necessarily fanatics. If the doctrines of free trade are really in conflict with such ideas and aspirations as I have referred to, they may have to give way. Trade concerns material interests, whilst real friendship and harmony of feeling between English-speaking races (amongst whom I should be ashamed not to include the United States) are objects for which it may be well worth while to make some sacrifice of such interests. But I am ready to take issue with the commercial federationists on this view of the question, and I challenge the advocates of protection to show that the steps they urge will promote the harmony we both desire. I believe, on the contrary, that they will have a directly opposite effect.

There is nothing so dangerous to friendly feeling as the consciousness of an obligation which is felt to be a daily cause of injury or loss. No wise men or women, and no wise communities, who desire to be on friendly terms with each other, will willingly involve themselves in any such obligations. Nor will they do so, if the conditions are such that the engagement, though possibly for the moment advantageous, will probably in the future become a burden.

Now, this is the case with all the schemes of commercial federation that have been suggested, and, amongst others, with that suggested by Mr. Chamberlain. It is a scheme of increased restriction, and this raises a primâ facie case against it. Let us consider it in its application to particular cases; for it is thus alone that we can test it.

England is asked to put a differential duty on foreign produce, i.e. on food and raw materials, which is the produce of the United States and of other foreign countries; in other words, to exclude these articles when coming from foreign countries, including the United States, in order to encourage imports from the colonies, including Canada. It has been shown above what a tremendous sacrifice this involves on the part of England. It has been shown that to buyers in the United Kingdom it must make food and raw material dearer or more difficult to obtain than they would otherwise be, and that it must consequently narrow the means of living and cripple our manufactures and our exports.

Will it conduce to friendly feelings in this country towards Canada, if our working classes are told that their food is dearer, or that their employment is lessened, in order to give more profit or more employment to the landowners and farmers of Canada? And supposing, as is more than probable, that the United States should retaliate and exclude the thirty millions' worth of manufactured goods and the many millions' worth of shipping services which we send them, will the loss of that profit and employment make Canada and her people dearer to our manufacturers and our workmen?

Nor is this all. The whole commercial system of the world is in a state of flux. Many persons think that there will be a general revulsion from the protectionist craze which now afflicts the nations. It is quite on the cards that such a revulsion may come in the United States. Suppose that it were to come, and that, as was the case with ourselves, the first form it were to take was that of reciprocity. Suppose the United States Government were to come to ours and say, ‘We will open our markets to you, but it is only on condition that your markets are open to us.’ And suppose that our Government were obliged to answer, ‘No, thank you. Much as we should like your market, we cannot accept it, for we have made engagements with Canada by which we are bound to keep your goods out of our market.’ Is it possible to conceive anything more likely to make Englishmen say, what I devoutly trust they may never have reason to say, ‘Perish, Canada!’

Look again at the case from the Canadian side. Nature and geography seem to have made the United States and Canada for mutual intercourse. These two nations have set up barriers against one another, which one party in Canada has treated as an intolerable burden, and which even the other party (the party which is responsible for them) has been in vain trying to lower by negotiation with the United States. Now, suppose that Canada has been bound by arrangement with England to exclude United States goods in order to favour English goods, and suppose that the free traders of Canada had been able to say to the electors of Canada, ‘You sorely want trade with the United States; but they will not give it you till you admit their goods freely. This you cannot do because you are bound by your engagements with England to exclude United States goods.’ Unless Canadians are made of different stuff from other men, such a cry would enable the free-trading party in Canada to sweep the board, with what feelings towards the mother country, and with what result on the connection between her and the colony, it is painful to imagine!

Further, suppose that such an arrangement could now be made, and that it proved for a time completely successful, and that by a system of quasi monopoly, we were to nurse up a system of industries in Canada which could not have existed in the face of United States competition; and suppose that there was then to occur that revulsion in the commercial policy of the United States of which I have spoken—that their Government were to offer a free market to England, on condition of England's offering a free market to them; and that England, as it probably would do, were to accept their proposal. Would not the result be ruinous competition and injury to the Canadian interests which we had artificially fostered? And if so, what would be the feelings of Canada towards the mother country?

I have taken these hypothetical cases as illustrations—and they might be multiplied indefinitely. But they are enough to show what dangers to friendship lie in any restrictions which either party may, now or hereafter, feel to be injurious.

It would be easy to dilate on these difficulties ad infinitum. They are so great as to make it justifiable to come to a general and absolute conclusion that no scheme can possibly be proposed on Mr. Chamberlain's lines which is not open to fatal objections.

But it is not necessary to dogmatize. Let Mr. Chamberlain and his Canadian friends, instead of concealing their meaning in vague generalities, condescend on a specific scheme, and we shall be ready to meet it, to receive it with welcome if practicable, but to condemn it unreservedly if it is as objectionable as all schemes hitherto proposed have been shown to be.

The promoters of Imperial Federation do not appear to recognize the obvious historical fact that the present excellent and improving relations between the mother country and the colonies have been brought about by the wise statesmanship which recognized that freedom is the greatest of boons—that it is greater even than free trade; that the best way to create good feeling is to remove legal obligations which gall both or either of the parties; and that to re-impose such obligations would be to endanger the good feeling which has been created.

[1]Letter from John Bright to T. B. Potter, July 31st, 1877.

[1]Since then the Canadian Government has explained that it will not give up protection of Canadian as against British manufacturers, though it may be willing to increase differential duties against foreign countries.

[1]See Board of Trade Return, C. 6394 of 1891, pp. 71–79. The figures have been continued from the most recent Statistical Abstract of the United Kingdom. By Canada Lord Farrer seems to have intended British North America, which includes Newfoundland, a distinct colony and customs area.—F. W. H.

[1]See note on p. 459.

[1]See Statistical Abstract of the United Kingdom. Here again the figures for imports are slightly vitiated by the inclusion of Newfoundland. It is a defect of the Statistical Abstract that it does not give the imports from Canada alone.—F. W. H.

[1]Board of Trade Return, C. 6394 of 1891, pp. 71–97. The figures have been continued from the Statistical Abstract for the United Kingdom.

[1]In 1900, 11,738,000 tons of shipping were engaged in the direct trade between the United Kingdom and the United States, of which 10,162,000 were British, 541,000 American, and 1,035,000 foreign.—F. W. H.

[2]See Statistical Abstract for the United Kingdom, and C. 7875 of 1895.

[1]See Statistical Abstract for the United Kingdom, and C. 7875 of 1895.

[2]See Statistical Abstract for the Colonies, C. 7904 of 1895.

[1]See Return C. 6394 of 1891, above referred to, pp. 71–79.

[1]Merchant's Petition, 1820.

[2]The Merchant's Petition will be found set out at the beginning of this volume.—F. W. H.

[1]See an excellent article on ‘The Colonies,’ p. 10, of the Times of 29th June, 1896.