Preferential Trade
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The Empire Club of Canada Addresses (Toronto, Canada), 17 Dec 1903, p. 20-30


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Foster, Hon. George E., Speaker
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Text
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Speeches
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Defining what the question of preferential trade means. Ways in which Imperial Preference is not the same as Imperialism. A quick definition of Imperial Preference. A proposal in the rough, to be worked out into detail later. Differentiating treatment of members and non-members of the family of the British Empire. What Imperial Preference does not and would not mean. A growing sentiment for a closer relation and over and above that growing sentiment, a movement which is beginning to take concrete form and embody itself in practical and working ways. Such sentiment of its free will to reach into a concrete form, approved of by both the Mother country and the Colonies, with their good will. Upon what such sentiment has grown. Two great moving influences which are pressing these countries of today into closer trade relations. How we should treat each other. Upon what the drawing power, pushing this question forward in Great Britain and these Colonies today, is based on. The element of unfair competition of the outside nations. The British instinct of fair play. What free trade means. The basis for this mutual preference: the idea of protection. The origins of this idea of mutual preference. Mr. Chamberlain's support for preference. Looking for the voice of Canada. What is being done. Advantages to Canada. Thinking about what the British market means. Being asked to put Imperial Preference on one side and American Reciprocity on the other.
Date of Original:
17 Dec 1903
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English
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Full Text
PREFERENTIAL TRADE.
Address delivered by the Hon. George E. Foster, B.A., D.C.L., LL.D., Ex-M.p., Finance Minister of Canada, 188$-96, before the Empire Club, on Thursday, December 17th, 1903.

MR. PRESIDENT,--will please take my heartfelt thanks for the kindness of your invitation and the kindness of your reception, and consider it just as hearty as if I spent fifteen minutes in expressing it to you. I believe this is a Club which means business, consequently we will do away with prefaces and with those more or less artificial endings with which speakers like the Hon. Mr. Ross and myself sometimes like to amuse audiences, and go straight to business.

The President has stated that I am to give you my experiences while in England. No, Mr. President, not quite. I am not so fresh as to tell you all that happened to me whilst in England. I may say some things, but I will be my own judge as to what things I shall say and as to what transpired. I am afraid, too, that I shall have to transgress a little on the programme and mention some few things which did not occur in England, but which are related to the discussion which is taking place there.

I think it is well in approaching this question to suffer ourselves to define exactly what the question means, so as to cut off from it everything which does not properly belong to it, and to read into it nothing that is not contained within the proposition itself. Now, Imperial Preference is not the same as Imperialism. Imperialism may be what any advocate of that idea chooses to define it. It is not fixed. It is in a state of flux and the first point I want to make is that we will do well here, as in Great Britain they are doing, to define exactly what Imperial Preference means, and not to go outside of that definition. A quick definition of it is simply this: It is a project for traffic and trade arrangements between Great Britain and her Colonies, beginning in that and ending in that-so far as this proposition and it's advocacy at the present time is concerned. It simply is, in fact, a proposal in the rough, to be worked out into detail later, that in the British Empire the treatment accorded to members of the family shall be a little different to the treatment which is extended to nations outside of the family.

It does not mean an attitude of hostility to outside nations; it simply means a bond and an agreement under that bond, by which the members of the Empire itself shall enjoy advantages which they think properly belong to them as members of that Empire. It does not embrace within it any proposition for contributions to Imperial defence; that is a question of very great importance, as to how much we shall appropriate in this country for defence and as to how we shall spend the appropriation when it is made. But it is entirely outside and beyond the proposition which is being discussed. There is not within the four corners of this proposition any attempt, any suspicion of an attempt, to curtail one single fiscal or political liberty which any Colony of the Empire today enjoys. Each will retain its own fiscal independence, each will retain it's own political independence in exactly the same fullness as it preserves and retains these this day. It does not imply, contemplate, or lay down any cut and dried system, or a new kind of representation, be it a Council or Parliament for the Empire. Those are also important questions, but please remember they do not come within the scope of the proposition which at present is being discussed in Great Britain and in her Colonies. We may take it for granted that in the British Empire, and I think no one will doubt that, there has been a growing sentiment for a closer relation and that over and above that growing sentiment for closer relations, there is a movement which is beginning to take concrete form and embody itself in practical and working ways.

That sentiment of its free will, without compulsion, should reach into a concrete form, approved of by both the Mother-country and the Colonies, with their own good-will and only with their own good-will. I have had the opportunity of witnessing in this country, in all the Colonies and in fact in Great Britain, the attempt of that idea to embody itself into a positive and concrete form, which if it is not successful in doing, it is not too much to say, will mark an epoch of very great importance, and with very great results hanging upon it, not only to the Colonies and to the Mother-country looked upon singly, but to the Empire as a whole. Once let this idea and the consent of the Mother-country and the Colonies take the form which is outlined in the proposals of today, and I think I cannot find words too important and too emphatic to mark the gravity and the import and the meaning and the significance of what that is to our country and to the world at large. Now, at this present moment we might ask ourselves upon what has this sentiment grown? Out of what soil has it sprung? Well, it has grown, I think, out of our kinship. We are descended from one another. We have institutions and inheritances in common; we defend one another; we do trade to a certain extent with one another; we have a common flag and we owe allegiance to a common Emperor or King. All this establishes a kinship; out of which and upon which has grown this desire for closer relation in some way or other between the members of the great family who own and who exercise that kinship.

Over and above that which we may call a drawing or attractive force, there is an element outside of the Empire. It is the hostile outside nations, and when I speak of hostile I do not necessarily mean warlike, but nations which have aims and tendencies of their own in trade, in national organization, in sway and in power--national ideals different from ours. They are to a certain extent hostile to us in that sense of the word hostile, and in these nations there has been growing up for the last twenty-five years, each year a stronger and more forceful expression of that rivalry and that competition and hostility denominated as I have clone it. That has had the effect upon the other hand of reinforcing the attractive bonds or drawings together based upon kinship, mutual inheritance and defence of which I have also spoken. It has reinforced them by the pressure from without. Now then, if you will make that idea clear to yourselves, you have two great moving influences which are pressing these countries of today into closer trade relations. If it is possible, we should treat each other of the blood, of the kinship, better than we treat outsiders. The fear of hostile outside nations which are pitted for national government in their ideals against British influences, is that by closer bonds and closer relations we may carry our own national existence more forcefully and more successfully by drawing ourselves together and becoming consolidated.

These two great principles, these two great powers, the attractive and the drawing power, are what is pushing this question forward in Great Britain and these Colonies today. What is it based on? I think I would not be wrong in saying that there is another powerful element in this question; this is the unfair competition of the outside nations. Here you have for instance a population of forty-two millions within the British Islands. There is the British consumer and the British capitalist; bring them together and they make the British producer. They make their goods and they put them before their own home market, forty-two millions of people. In that home market they are met with a competition strong, keen and powerful, and it becomes impossible for them to claim their due share of that home market itself. Now this results from a protective galaxy of nations whose population runs up to about three hundred millions of people. The competition floods in from Russia, from Germany, from Austria, from Italy, from the United States and from France, and men from all of these countries meet the English producer in his own forty-two million market on exactly the same ground that he himself has.

The British instinct of fair play says that is all right on one condition: come here and undersell me if you can, but two ought to be able to play at that game. Let me go to your three hundred million market and let me undersell you if I can on the same equal basis. If, however, he goes to the three hundred million market, he finds a tariff in Russia upon his manufactured goods of 33 per cent. He finds in the United States a tariff on what he exports to that country of about 45 to 5o per cent. That strikes Englishmen as unfair and unjust. In their devotion to a sentiment into which they were born, they have been loyal to the principles of free trade to within the present time. Now they say it is unfair. We have converted nobody, we must protect our own producer, our own capitalist. Free trade, if it means anything, is the competition of one man against another on equal conditions, is it not? Of one corporation against another on equal conditions? That is the way it used to be almost absolutely up to twenty-five years ago. Today every nation in Europe and outside of Europe has refused to allow a competition between individual and individual, between corporation and corporation, and has changed the system until at last it is simply this: a competition and a rivalry in which the British individual and the British corporation without national backing, fights against the foreign individual and the foreign corporation with a national backing of a heavy and hostile tariff. Now, the British instinct says that is unfair, in some way it must be remedied and this Preferential policy is one of the ways in which it may be remedied.

What is mutual preference between Great Britain and her Colonies based upon? Based on the idea of protection. I notice that a very distinguished man speaking in Toronto not long ago said: " If Mr. Chamberlain designs protection, then I have nothing more to say for him; if he designs reciprocity, I have something to say in his favour." It strikes me it is impossible for this country to give a preference to Great Britain or Great Britain to give a preference to this country, unless first there is a tariff which may be lowered to the amount of the preference which is to be given. There is no other way. And so in Canada itself, long ago we took the right to protect ourselves, we embodied that right in practice, and when we were ready we gave a preference by cutting down a portion of that protective tariff in favour of the Mother-country. The only way in which Britain can give us a preference is to raise the level of protection. When she does that, then she can consider how much of a preference she will give to her Colonies in their different products. It seems to me impossible and it seems to me as well inconsistent, for anyone in this country, no matter to what party he belongs, to show his opposition to an Imperial preference because the principles of protection to a certain extent must underlie it.

Whose child is this anyway? I do not think that you people in Canada can assume an attitude of indifference to the fight which is now being waged in so picturesque and able a manner in Great Britain. I do not think you can. I will go further and say I do not think that any thoughtful Canadian who supports the principles of either of the great parties and the policy of either of the great parties in this country, can do anything else. But when the very child that has been given birth to, nationally considered, has been brought up to a certain degree of vigour in Great Britain by Mr. Chamberlain who has taken it for adoption, I do not think that any Canadian can afford to do anything else but td stand at the back of Mr. Chamberlain in the effort that he is making. Now, as to the question whose child is it? You have only to take the records and see. This idea as it is broached by Mr. Chamberlain today 'and the proposition which he is now trying to make operative, is a proposition which was first put into concrete form and adopted by some of the Colonies of Great Britain as their own years ago.

Look at our statute books. Leave out the Intercolonial Conference of 1894 and just come to the statute book and there you have the legal enactment of the opinion of Canada that a preference would be a good thing, and that as they believe it to be a good thing, they have given a preference of thirty-three and a third per cent. to Great Britain and other Colonies. There it is, an actual, positive enactment, the highest form in which the public opinion of a country can express itself. But there is more than that. In 1902 there was an Intercolonial Conference in Great Britain. The Premiers of all the Colonies were there; our Premier amongst them, and they came to certain conclusions, and I just want to read two of them. First, that this Conference recognized that the principle of Preferential trade between the United Kingdom and His Majesty's Dominions beyond the Seas, would stimulate and facilitate mutual commercial intercourse; that is the trade side of it. Next is a positive announcement that Preferential trade would, by permitting the development of the resources and industries of the several parts, strengthen the Empire. There is the Imperial side of it. There is the ripened pronouncement of all the Colonies through their Premiers after years of the principle being embodied in the legislation of Canada and some other of these Colonies. " That the Prime Ministers of the Colonies respectfully urge on His Majesty's Government, the expediency of granting unto the Colonies of the United Kingdom preferential protection on the products and manufactures of the Colonies, either by exemption from, or reduction in the duties now and hereafter imposed."

Do you want anything more positive than that? It is absolutely the request of the Colonies of Great Britain, based on their giving to Great Britain a tariff preference in the hope and belief that it will help trade and strengthen the Empire. Then they came to the British Government and say through Mr. Chamberlain, "We want you either to put a duty on, or drop off some of the duty you now have on imports, in order to give a preference to products of the Colonies. There is the request. Who was the British Minister with whom they conferred, with whom after conference upon conference they at last came to the satisfactory conclusion as to what the Colonies would do and what they wanted. That Minister was Mr. Chamberlain. He was in perfect accord with them. He would have gone farther, but being a practical man said, "What we want to get is what we all willingly agree would be good for us. If I cannot get what I would like to have, I will get as much as I can for the good of this country and the Colonies." He was a member of the Government then, one of its most powerful members. He is not a member of the Government today, and why is he not? He is not, simply and solely, because having pledged his faith to certain principles, the Government said to him, "Mr. Chamberlain, we cannot go any further than to ask for a mandate for negotiation," whatever that may be, and "We cannot agree to a tax upon food because we have not the mandate of the people for it." Then, Mr. Chamberlain, a powerful Minister, past the zenith of his life, with all his honours richly earned by a long course in public life, in his sixty-seventh year, simply said, " Then I will search for that mandate and get it if it is possible."

Now, Sir, I think it will require a good deal of that basest of all elements in man's mind, a mean and unworthy suspicion, to find in the course of Mr. Chamberlain's action upon this anything which indicates aught of self-seeking. Greater honours he could not have; at an age when most men's minds are getting to be not quite so mobile as they were; when the man might very well ask to rest upon the career which was undoubtedly one that he had conquered with glory to his country and honour to himself; he goes out from the Cabinet, powerful and strong, with undisguised opposition amongst his own, with a solid front of opposition in the party that is opposed to him, and for what might seem and did seem a most forlorn hope. He did it because he had pledged himself to the Colonies, because he believed this to be the thing necessary for them and for the Empire. He is out for us and it is the duty of the Colonies to see him through.

Instead of seeing him through what are some men doing in this country today? Strong alternatives are being proposed. One man comes out and says, " What I want is Independence "a follower of the Government consenting to their policy, supporting the Government in its policy. Why is anybody looking around for an alternative of that kind? Another man says, " I want the power to make our own treaties in Canada," which means he wants the power to declare this country independent and to cut the last tie that binds us to the Motherland. Another man hies him away to the United States of America and in city after city, as an M.P. and a member of a Commission whose duties are not done and which may be called to carry them on, he begs of the different bodies which he addresses to look alive and " get a hustle " on and block this idea of Imperial trade union before it is eternally and everlastingly too late. Why are some people looking for these different alternatives ? Here is what these Colonies have wanted for years. Here is the object attained except the consent of the senior partner, and there in Great Britain is Mr. Chamberlain and his body of workers trying to get the consent of that senior partner. Yet where is the voice of Canada?

Sound to the very core in my belief is the sentiment of this country. It has come through Boards of Trade, it has come through representative bodies, it has come through representative men and all that piled on top of the actual enactment which in the statute book shows the mind and will of this people. Gentlemen, let me tell you one thing. Great Britain is a country where authority goes for a great deal. If at any time within these last three months when men like Lord Rosebery, Mr. Asquith, Sir H. Campbell-Bannerman and Sir W. Harcourt, have been standing on platforms and denying that the Colonies wanted, or were in favour of Preferential trade; if, during that time, one single moderate, authoritative statement had come from men who can well make it and make it so that there could not be the least shadow of misunderstanding; Mr. Chamberlain's campaign would have been fully fifty percent ahead of what it is today.

Now let me tell you what is being done. This movement is no flash in the pan. Mr. Chamberlain is an old campaigner as well as an old man in public life. He knows how things ought to be done. Rhetoric is all right, speeches are good, but underneath the speeches and rhetoric and sentiment, there is afoot one of the finest of organizations going into the details of the question to the furtherest parts of those Islands, that was ever set into form and force in Great Britain. Not only are the speakers and the literature and the private canvass going on steadily, but there is more than that, and one of the things which was fore-shadowed today in the despatches, is one which will probably prove as powerful as any. Mr. Chamberlain believes that he will win. When, he does not say, nor would I like to prophesy. It may be very soon, it may be a comparatively short time longer than very soon, but as sure as the agitation is on that agitation will be kept going until it will sweep those Islands into assent and the proposal will take the force of law. But the thing is to get it done quickly, as well as well done, and during the last three months, a project of which public notice was given yesterday has been under way. It is to have appointed at once (nearly every member of the Commission has now given his, consent to serve) a body of men selected from all the great trades and industries of Great Britain and Ireland, composed of men whose names will carry the very profoundest conviction and the greatest influence in these Islands, who are to give their time for nothing, to meet twice a week, to have a systematic course of hearings and enquiries, to get at the conditions of every trade, to study the advantages and disadvantages of foreign competition.

In a word, this body is to carry on what an Investigating Committee for tariff purposes would carry on in our own country, in the most thorough and business-like way, so that by the time Mr. Chamberlain's campaign is through and the English people have given him an affirmative answer to his question, he will not have to wait for a period of one or two years in order to get this information, but will have it in hand under these auspices, gathered and massed, ready to use for the formation of his tariff, for the consideration of his Parliamentary followers and for the Parliamentary representatives of Greater Britain. That is the point which shows more clearly than anything else the business lines upon which this whole matter is proceeding. Now, Mr. Chairman and Gentlemen, I have not time to mention several other things. (Go on! go on!) One natural question is, then, what will be the advantages to Canada? I want you to think of what the British market means. I want you to see that there are forty-two millions of people there, and that whereas the British producer of the food of that people grows a handful, he imports a whole armful. That about expresses the proportion between the two. Four million acres of wheat-lands were in cultivation 25 years ago in England; today less than 2,000,000. What does it mean? Population is increasing; 30,000,000 then, 42,000,000 now, 5o or 6o millions in not many years hence. It is a market that is constantly increasing in the number of mouths that are to be fed; a market in which there can be no corresponding increase in what is produced in the country itself. That is, it is a market where there is a chronic deficit which is growing, and as population increases as the years go by, there is a market, rich, great, strong, wide now, which every year becomes richer and greater and stronger and wider for those who have entrance to it. Let the Canadian producer have entrance to' that market, a favoured entrance over foreign competitors. Would not that be an immense benefit to the producer in Canada?

One word more, now, and that is this: You are asked (is it really a question now in Canada) you are asked to put Imperial Preference on one side and American Reciprocity on the other. Can the latter be galvanized into a question in Canada today? Depend upon it, there is a powerful effort being made to do so. What have we been building for? What is this Grand Trunk Pacific for? To make great lines of railway which run east and west, and not north and south. Mr. Charlton goes down to Boston. What does he say? " Liverpool fixes the price of the Canadian product. You will simply have the exporting of it. Your millers will get the milling, your transportation routes will get the carrying of it. All the rich drops which come from those long and extensive transportation routes will fertilize your soil. Your business men will get all the peelings." In the name of Heaven what is Canada built for? Have we not ports of our own? Have we not railroads of our own? Have we not a canal system of our own? Have we not a merchant marine system of our own? Have not we a country up here which wants the droppings from its own transportation? Let Mr. Charlton come to the City of Toronto and put that argument here before this people and see how many favourable answers he will receive.

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Preferential Trade


Defining what the question of preferential trade means. Ways in which Imperial Preference is not the same as Imperialism. A quick definition of Imperial Preference. A proposal in the rough, to be worked out into detail later. Differentiating treatment of members and non-members of the family of the British Empire. What Imperial Preference does not and would not mean. A growing sentiment for a closer relation and over and above that growing sentiment, a movement which is beginning to take concrete form and embody itself in practical and working ways. Such sentiment of its free will to reach into a concrete form, approved of by both the Mother country and the Colonies, with their good will. Upon what such sentiment has grown. Two great moving influences which are pressing these countries of today into closer trade relations. How we should treat each other. Upon what the drawing power, pushing this question forward in Great Britain and these Colonies today, is based on. The element of unfair competition of the outside nations. The British instinct of fair play. What free trade means. The basis for this mutual preference: the idea of protection. The origins of this idea of mutual preference. Mr. Chamberlain's support for preference. Looking for the voice of Canada. What is being done. Advantages to Canada. Thinking about what the British market means. Being asked to put Imperial Preference on one side and American Reciprocity on the other.