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to other countries should be extended to British subjects; and other Powers in subsequent treaties exacted a similar guarantee. But for the goods and people of China the European Powers offered no reciprocity of favours in their own countries.

Section 5. Imperial Preference

Huskisson retained and liberalised the system of preference by the colonies in favour of the Mother Country, and by the Mother Country in favour of the colonies.

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The former replaced the old compulsion under the Staple Act of 1663 to receive manufactures from the Mother Country only. When by the legislation of 1822-5 the ports of the colonies were freely opened to foreign goods, such goods were subjected to duties sufficient for the fair protection of our own productions of the like nature.' 1 America, being no longer a part of the empire, had to pay them, and was at first very indignant, scenting a renewal of the shipping discriminations abolished by the treaty of 1815; but Huskisson insisted on the difference between them. It is just as unreasonable,' he said of America's attitude, ' as it would be, on our part, to require that sugar and rum from our West India Islands should be admitted at New York upon the same terms and duties as the like articles, the growth and production of Louisiana or any other of the twenty-four separate States which now constitute the Federal Union.' 2 Huskisson met retaliation by retaliation. In 1830 the differences were at last adjusted. The U.S.A. acquiesced in Great Britain's claim to give and take preference within the Empire, and, subject to this, they were admitted to full equality in the West Indian trade. Meanwhile in 1828 the U.S.A. had introduced a severely protective tariff, and, though it was aimed at Great Britain, they had as much right to this course as had Great Britain to her preferences.

The preferences from the colonies, differentials' as they were commonly called, were dictated by the Mother Country and therefore displeasing to the colonies. For though Huskisson liberated the trade of the colonies and abolished the fees payable to the Government, naval officers and others, which frequently amounted to more than the public duties both on the ship and the cargo,' he did not give them fiscal autonomy. By the Declaratory Act of 1778 (18 Geo. III, c. 12) the Mother Country, in abjuring the power of taxing the colonies, had excepted' such duties as it may be expedient to impose for the regulation of commerce.' Therefore the position which Huskisson found and 1 Speeches, II. 317. 2 Ibid. II. 315. 3 Ibid. II. 323.

left was that the colonial legislatures levied certain duties for revenue, while the Imperial Parliament levied further' Imperial' duties (the proceeds of which went to the colony concerned) in the interest of British trade. The differentials' were prescribed in the British Possessions Act. The last of these, that of 1842 (5 & 6 Vict. c. 49), in conformity with Peel's tariff reductions, reduced or repealed the differentials' in favour of British goods or goods from other colonies. The Enabling Act of 1846 (9 & 10 Vict. c. 94), hurried through Parliament during the last days of the Corn Law crisis, enabled, nay invited, the colonies to reduce or repeal the differentials which remained. Canada (i.e. Ontario and Quebec) promptly complied, but New Brunswick in 1848 had not yet availed itself of the power. However, there was still no thought of allowing a colony to frame a tariff which favoured itself at the expense of the Mother Country. And Canada after gaining self-government had to fight for this further power in 1859: which she won in the face of protests from the Sheffield manufacturers, strongly backed by the Colonial Office. It was urged against her that the tariff of 1859 was really a differential' in favour of the U.S.A. owing to the ease of smuggling across the border. But the British Government had to give way, and having yielded over the main issue confined its efforts henceforward towards keeping the tariffs of the self-governing colonies free of ⚫ differentials' which would interfere with uniform treatment of all commerce, British or foreign. This led to a conflict with Tasmania in 1867; for the Australian Constitutions Act of 1850, unlike that of 1852 for New Zealand, forbade differentials,' and therefore the Home Government disallowed the agreement which Tasmania proposed for reciprocal trading with the Australian colonies and New Zealand. It gave way in 1873 in consideration of the fact that the differentials' desired were inter-colonial, but it was not till 1895 that the Australian colonies had power to arrange with foreign countries reciprocal tariffs which involved 'differentials.'

Throughout this protracted fight for fiscal autonomy the influence of America was apparent. The growth of American protectionism reacted on Canada, and the success of the closer trade relations between Canada and the U.S.A. under the Reciprocity Treaty of 1854 inclined Australia and New Zealand to a similar arrangement. Thus it came about that the policy of differentials,' which Huskisson had supported as part of a liberal imperialism, became first a stumbling-block in the way of colonial autonomy and later a pattern for closer relations with other countries to the possible exclusion of the Motherland.

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On her side, too, Great Britain gave preferences, which, as they involved no subordination and were valuable commercially, were very acceptable to the colonies. Such preferences were as old as the Empire, but they assumed a new importance at the beginning of the 19th century, when Great Britain was short of timber and corn and seeking to replace the gap made in her scheme of imperial supply by the revolt of America. The oldest of them was on West Indian sugar. Down to 1841, however, this was almost a monopoly, since the duties on foreign sugar were prohibitive; and therefore Huskisson had little scope here. He lamented the dependence of the West Indies on a single crop, and he extended to West Indian ports the privilege of the British Bonding System in the hope of diversifying their commerce. Sugar, having become a necessary of life in England, yielded a large revenue: in Huskisson's time it was almost one-third of the whole Customs revenue. Therefore the West Indian planters demanded lower duties rather than higher protection.

Spirits, tobacco, and wine were also big revenue yielders and the duty of Customs was tied up with that of Excise. Here, therefore, Huskisson exerted his influence through Robinson, the Chancellor of the Exchequer. Rum, the leading colonial spirit and natural drink of the sailors who fetched it, had long enjoyed a preference, which during the French wars was curtailed in the interest of revenue. But in 1826, while the duty of Customs and Excise on brandy and gin was left at £1 2s. 6d. the gallon, which was approximately the rate of 1814 to 1823, that on West Indian rum was lowered from 12s. 7d. to 8s. 6d. This reduction, however, was far outweighed by the fact that the duty of Excise on home-made spirits was lower still, so much lower, indeed, in Scotland and Ireland that the use of rum greatly declined. In this way' Scotch' was lifted into alcoholic fame.

Tobacco, i.e. unmanufactured tobacco, was in a curious position. America, the chief source of supply, did not lose her preference over Spain and Portugal till 1826. British Planta

tion or American' paid a lower rate. After 1826 the U.S.A. was included in other parts' paying 3s. per lb. (Customs plus Excise) against 2s. 9d. by British Plantations in America.' But the preference was secured by bringing the rates for other parts down to the former rate for America and giving British Plantations a 3d. preference on that. Otherwise a higher duty than before would have been imposed on the raw material of an important British manufacture. Cape Wine, a comparatively new product, had enjoyed a big preference in the combined duty of Customs and Excise since 1813. In 1825, when the whole of the wine duty was restored to the Customs, the margin was

maintained and stood out clearly after 1831, when the differential rate against French wines was abolished. Cape Wine then paid 2s. 9d. a gallon against 5s. 6d. from all other countries.

During the Napoleonic Wars stiff duties were imposed on Baltic timber with a view to aiding the lumbering industry in the Maritime Provinces of Canada. After 1815 these duties were raised. But since the best quality of shipbuilding timber came from the Baltic, the powerful Baltic interest demanded a reduction; and since the duties yielded a substantial revenue, the Chancellor could not afford a lower rate without compensation elsewhere. Therefore in 1821, when the duty on Baltic timber was reduced by ten shillings a load, a duty of ten shillings was for the first time imposed on colonial timber. Huskisson was urged in 1825 to carry the reduction further, but he refused, stressing the imperial argument. 'Canadian timber, considering that it grew in one of our own colonies and was transported in our own ships, was a most valuable trade to Great Britain.' 1 But it was a precarious trade for the crews. Ships so unseaworthy that they would not float if loaded with anything but timber ended their days in the North Atlantic timber trade, and such was the scandal of these coffin ships' that an Act was passed in 1839 (2 & 3 Vict. c. 44) to regulate them. Moreover, even after 1821 the preference was so substantial that there was profit in carrying Norwegian timber to Canada, taking out certificates of origin there and thus fraudulently obtaining the benefit of the preference. Under every Corn Law since 1791 a preference had been granted to the colonies: and to Ireland down to 1806, when bounties and duties on corn passing between Great Britain and Ireland were abolished. During the Corn Law discussions of 1814 and 1815 Huskisson applied for and received a widening of the preferential margin. In 1825 he asked for a special concession to Canada, by which Canadian corn should be admitted at all times into the consumption of the country upon payment of a fixed and moderate duty. Parliament granted this for a period of two years, and under the Sliding Scale Act of 1828 the colonial range of duties ran from 5s. 6d. to 6d. per quarter against the foreign range of 20s. 8d. to Is.

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In corn and timber Huskisson was thinking in terms of North America and in sugar in terms of the West Indies. But sugar was grown also in the East, in East India and Mauritius, which became British in 1810. Since 1814 these other sugars had enjoyed a preference nearly equal to that of the West Indies, and Huskisson continued it, raising Mauritius in 1825 to the West Indian level. India received special preference in silks. When

1 Speeches, II. 362.

Huskisson opened the silk trade in 1825 he gave India a preference, which remained at various rates down to 1860: 20% against the foreign 30% in 1829, 5% against 20% in 1842, and 5% against 15% in 1846. Similarly, when imposing 6d. per lb. on foreign wool, he made the Australian rate Id., and in 1825, when the foreign rate was reduced to Id. (to be abolished finally by Peel in 1844), he admitted colonial wool free.

Taken in the sum Huskisson's preferences were very comprehensive, and they were applied with a balanced regard for every part of the Empire, including that part which had its home in ships. For the reservation of imperial shipping to ships of the Empire was in Huskisson's view the corner-stone of imperial preference. After his death the cause of imperial preference fell into disrepute. As the memory of war faded, the appeal to imperial sufficiency, which had attracted imperialists like Huskisson, lost its force. Peel, under pressure, made one final extension in 1843, when he admitted Canadian wheat and wheat flour at a nominal duty of Is. per quarter-Canada in return imposing a 3s. duty on American wheat; but it excited such opposition among his Tory supporters, the hereditary patrons of Empire, that a request from Australia and New Zealand for similar treatment was refused. In 1846 the repeal of the Corn Laws ended the corn preference; for Great Britain would not waive on behalf of Canada the Is. registration duty which remained on wheat. In 1854 the duties on colonial and foreign sugar were equalised in 1860 those on wine and spirits: in 1863 those on tobacco. In 1860 the preferences on timber and silk disappeared automatically upon the repeal of the protective duties. Thereafter for more than thirty years a once great imperial cause lay entombed in the leaden shell of Gladstonian finance.

Section 6. The Revision of the Tariff

1822-1828 were years of prosperous trade, which was checked but not dispelled by the financial crisis of December 1825. The Chancellor of the Exchequer, F. J. Robinson (created Viscount Goderich in 1827), was therefore able to gratify the taxpayer with justifiable remissions of taxation; and the flourishing reports which he presented in his budget speeches year by year won him the sobriquet of ' Prosperity Robinson.'

Some of these remissions had no direct connection with trade policy. 1823 saw the abolition or reduction of the assessed taxes on windows, shops, horses, carriages and servants; 1824-5 the reduction and abolition of the transit duties on coals carried coastwise into the port of London or other ports or entering

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