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The Pamphlet Collection of Sir Robert Stout: Volume 52

Reciprocity Explained

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Reciprocity Explained.

Buckle crest of the Cobden Club

Terms, like coins, wear out by use and misuse.

Protection is one of these terms. It was a bright, well-gilt piece of currency, bearing the lineaments of an unduly fat farmer on one side and a plethoric landlord on the other, and was largely circulated at Election and Agricultural Dinners. But during the Anti-Corn Law Agitation the gilt was rubbed off, when there were discovered on one side groups of hungry families and on the other a workhouse. The coin became defaced, broken and battered, and it had to be returned to the mint of worn-out words.

A few years ago it re-appeared stamped with the plausible name of "Fair Trade." Though very well coined, it was mere bronze metal; it never got well taken up. Lately it has been "called back," and another piece, supposed to have a better ring about it, entitled "Reciprocity," is now offered for circulation.

As Reciprocity is an old acquaintance under a new face, the present generation of readers hardly know it again. Their fathers knew it well. As everybody is destined to hear a good deal of it, it will be useful to many to explain it.

The Governments of some Foreign Countries, finding traders complaining of lack of customers and workmen complaining of low wages, say—

"We know an excellent way of relieving you. All articles which you need, and which English merchants sell in your markets at forty shillings, we will make dearer by putting a duty of ten shillings upon each. The merchants will then charge you fifty shillings for each article. He will pay us ten shillings for permission to sell to you, and you will pay him ten shillings extra for each thing you buy. We shall be all those ten shillings richer, and you will be all those ten shillings poorer."—This is Protection.

The Conservative party and others in England, learn- page break little more closely, and we shall find that it is not possible to tax any large portion of the imports.

The imports may be divided as follows:—

Articles of Food (duty free) £133,810,000 Raw Materials for Manufactures: Textile Fabrics ... ... ... £86,303,000 Ore ... ... ... ... ... 16,806,000 Miscellaneous ... ... ... 16,043,000 119,152,000 Articles of Food and Drink (dutiable): Wine and Spirits ... ... ... £7,237,000 Tea ... ... ... ... ... 10,567,000 Tobacco ... ... ... ... 2,777,000 Cocoa, Coffee, Currants, &c. ... 7,844,000 28,425,000 Miscellaneous ... ... ... ... ... 14,140,000 Semi-Manufactured Articles ... ... ... 40,983,000 Manufactured Articles ... ... ... ... 53,265,000 £389,775.000


Now which of these items can really be taxed?

The Articles of Food (duty free) are agricultural produce, chiefly corn, with butter, cheese, hams, eggs, &c., articles of everyday food. It is almost universally acknowledged, even by Fair Traders themselves, that the "Food of the People" cannot be taxed; the days of the dear and taxed loaf have fortunately gone by. This amount—£133,800,000—must therefore be deducted.

The Raw Materials for Manufactures, consisting of wool, cotton, hemp, raw silk, copper, tin, iron ore, &c., are necessary to our manufactures, and to tax them would be a serious injury, for it would raise the cost of production, and paralyse our powers of competition in the markets of the world. This raw material—£119,200,000—must therefore also be deducted.

The Dutiable Articles of Food and Drink, which include wine, spirits, tobacco, snuff, tea, cocoa, coffee, currants, dried fruit, &c., and which may be called "luxuries," are legitimate subjects for taxation. But we already raise about £20,000,000 a year from these articles in customs' duties alone, and it would be impossible, page break even if expedient, to increase these duties to any large extent. These articles also—£28,500,000—must therefore be deducted.

The Miscellaneous Articles include live animals, oil cake for feeding cattle, and seeds (not corn) of different sorts, &c., all articles which could not be taxed. These then—£14,200,000—must be also deducted.

Thus, before we come to articles on which we can impose retaliatory duties, we have to deduct from the total imports of £390,000,000—food, £133,800,000, raw materials, £19,200,000, "luxuries," £28,500,000, miscellaneous, £14,200,000—in all, £295,700,000; leaving £94,300,000 of manufactures and semi-manufactures.

But the Semi-manufactures, consisting as they do of such articles as wood (sawn and hewn), hides, rags, tallow, &c., are really of the nature of "raw materials," being all used in our manufactures, and they—£41,000,000—must also be deducted.

Thus, of our grand total of £390,000,000 of imports, we have left but £53,300,000 on which retaliatory duties could be placed, or which in any way compete with articles of Home manufacture—not a very large amount out of a total foreign trade of £685,000,000.

But even this total is not fully available for taxation. Some five millions of these Manufactures simply pass through the country, and are re-exported elsewhere, and a tax on them would prevent them coming here at all, and we should lose the profits on transit. Again, of this total, some eighteen or nineteen millions consist of innumerable small articles, chiefly "fancy goods," taxes on which would be vexatious and unremunerative.

Thus, a further sum of £23,000,000 or £24,000,000 must be deducted from the £53,300,000, leaving a total of but £30,000,000 of Manufactures (cotton, silk, woollen, leather, iron, &c.); and this practically represents our maximum powers of attack on the foreigner.

But now we must look at the other side, and see how our trade could be attacked if we determined to enter on a "war of tariffs."

Our Exports may be divided as follows:—

Exports. (Including Foreign and Colonial produce, 62½ millions.)
Articles of Food and Drink £26,100,000
Miscellaneous (Colonial) 11,300,000
Raw Materials 43,000,000
Manufactured and semi-Manufactured Articles 215,000,000
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ing that distress largely prevails, advise the English Government to take up the same parable and say to the people—

"We will soon put that distress all right. In America, Canada, and other countries, they levy a heavy duty upon all our goods exported to them, which makes them dearer to the buyers. This is considered a great boon to poor people, and a form of relief in their distress, since it obliges them to pay a much higher price than they need do for what they want. We will therefore put an import duty on all articles, wheat or goods, which other countries send into our markets, so that every article they now sell the English people at forty shillings shall pay a duty of ten shillings, which will raise the price to fifty shillings here. We shall have ten shillings collected at the Custom House upon each article, and the half-employed, half-starved people will have to pay it."—This is Reciprocity.

"This," they say, "will soon relieve the distress. All that is wanted is that the people should ask for this themselves. If they do they shall surely have it."

Protection means the Government plundering the people. Reciprocity means the people plundering themselves.

Those who propose it do not speak in this plain manner, but this is what they would say if they did speak plainly.

There are several kinds of Reciprocity—good, bad, and foolish.

When we say one good turn deserves another, that is good Reciprocity.

When men propose to meet one evil turn by another of the same kind, that is bad Reciprocity.

But when another nation taxes our commodities brought into its markets, and makes them dearer to all inhabitants who buy them there, and we propose to tax their commodities sent to our markets, making them dearer to all our own people who purchase them here, that is mad Reciprocity.

If it were not advocated as a political remedy by respectable politicians, the proposal would be brought under the notice of the Lunacy Commissioners.

George Jacob Holyoake.

Messrs. Cassell & Company, Limited, La Belle Sauvage Yard, London, E.C., supply this Leaflet in packets of 100, price 1s.

* All the figures are taken from the official returns of the Board of Trade, which any one can obtain for himself.

Lord Salisbury, expressing an almost universal opinion, has said that "the food of the people, and the raw materials of our industries, must be held sacred" from a duty.