Preface.

The following essay was written early in the present year. The appointment of a Royal Commission to investigate the causes of the Trade Depression seems an opportune moment for its publication, and I therefore put it forth as a small contribution towards the discussion which is taking place.

According to the Memorandum of the Chairman, the inquiry into which the Commission is about to enter includes in its scope, not only the collection of evidence which shall deal minutely and exhaustively with the condition of trade and industry at home and abroad, but also an excursion over the whole field of Political Economy. It is hardly too much to say that an investigation carried out on the lines laid down, followed by a Report which shall deal adequately with the subject, would under any circumstances occupy several years, and that whatever may be the practical value of their labours, the Commission cannot reasonably look for a release from their task until the close of the century. Passing from this seriocomic business, however, I have to remark that our foreign trade figures for the first seven months this year show a falling off of £8,846,140, or 3.8 percent, in our imports; and of £16,142,978, or 9.2 per cent, in our exports, as compared with the figures for 1884. The falling off in our exports is serious, and demands some notice. Mr. Mongredien, in his pamphlet, Trade Depression, Recent and Present, lately published by the page vi Cobden Club, calls attention to the fact that the decrease in our exports this year is principally, if not entirely, due to the great falling off in our import of cereals last year. In 1884, when we had a good harvest, we imported 19½ millions worth of wheat, oats, and other cereals, less than we did in 1883, and he points out that, as an ordinary trade transaction, there cannot be an export without an import, the fall in our exports this year is the direct consequence of our lessened imports last year. This he shows to be no national loss. What our shipping and foreign trading interests lost, as regards this special cause, our agricultural and home trading interests gained. Confirmation of this view is to be found in what happened in 1879-80, when the converse of all this took place, the disastrous harvest of 1879 being followed in 1880 by a sudden rise in our foreign trade from 611¾ millions to 697½ millions.

Finally, we have to bear in mind that we are now suffering from the poverty and bad economic condition in which some of our customers, notably those whose fiscal system is that of Protection, find themselves; and that, until they by some means are enabled to better their condition, we cannot reasonably look for any expansion of our foreign trade irrespective of that which comes naturally from increase of population and wealth.

August, 1885.