M i nterval CHAMBERLAIN has only lately retired from a Conservative
Government, but in that short nterval he has become the least Conservative of politicians. He rises superior to all weak regrets for the system under which he has passed his whole career and the greater part of his life. He casts no lingering look behind at the vast fabric which, if he carries his point, he will level with the dust in the next Parliament. It is no wonder that Mr. Felix Schuster, whose right to speak with authority will be acknowledged by every banker in England, should marvel at the slender equipment of facts with which Mr. Chamberlain has embarked upon this great controversy, or at the contentment with which he contemplates possibilities which, if they could but be presented to his vision, would fill him with uneasiness. It might have bean thought that a statesman who proposed to upset the whole commercial system of Great Britain would have liked to submit his scheme to men accustomed to weigh evidence. Mr. Chamberlain has never shown the . slightest wish to do anything of the kind. He has brought forward witnesses in abundance, but they have never been . subjected to cross-examination, and their testimony has been addressed to men less well informed than themselves, and no more capable of arriving at any reasoned conclusion. In the last resort, no doubt, it is the electorate that must decide between Protection and Free-trade. But why . should the electorate be denied the assistance which every ordinary jury enjoys in the charge of the Judge ? The mass of evidence in an ordinary trial is so complicated and so confusing that without a trained lawyer to guide them through its windings the jury would. often come , to no agreement whatever. They would retire to consider their verdict less able to distinguish what was material from what was immaterial than at the moment when the first witness was called. It will be strange if the position of the electorate when the Dissolution comes is not very much the same. They will have listened to some speeches and read a great many more, but they will have no better acquaintance with the subject than on that fateful day last May when Mr. Chamberlain first disclosed his pro- posals to an astonished nation. No wonder that Mr. Schuster asks in the January Monthly .Review, as he asked at the Institute of Bankers a fortnight ago :—" Is it too late even now for men of business to make an endeavour to ,have this question removed from the political arena ? To have this problem decided at the hustings without further inquiry appears to me as if a great question of law involving the very highest considerations were to be decided, not by the Lord Chancellor, but at the polling booths." There are over a dozen Royal Commissions now sitting on subjects closely connected with the fiscal problem, and yet there has been no Royal Commission on the fiscal problem itself. It " has not even been debated in Parliament, and yet an appeal to the country is looked upon as imminent in many quarters." Mr. Chamberlain's own mind is made up, and though in the first instance he murmured the word " inquiry," he dismissed all thought 'of it so soon as there seemed a chance of bringing the nation round to his view without it.
When Mr. Schuster compares this easy confidence with the difficulty and importance of the question to which it relates, and sets the special indifference shown to the City of London by the side of " the services it renders to the nation both as regards its contribution to the general prosperity and the employment it finds for millions of workers," his astonishment is still further increased. " London is the financial centre of the world, and upon its ability to maintain that position depends the prosperity of the whole kingdom. A bill of exchange on London is the recognised medium of settling international transactions which is made use of in all parts of the world. Thus the China merchant who sells tea to Russia or Germany, or silks to the United. States, will probably.obtain payment through the medium of the London Money Market, and equally the German merchant who sends his goods out to China The coffee that is shipped from Brazil into France or Italy, the cotton from New Orleans to Poland, sulphur from Sicily to the United States, and agricultural machinery from the United States to the River Plate, all these trades find their Clearing House in Lombard Street If a Dutch capitalist invests his money in an American railway, he will probably complete the purchase by a payment in London ; and when the United States paid Spain for Cuba, it was through London that the transaction was settled, and the same, of course, applies to the Chinese payment to Japan at the close of the war."
Mr. Schuster then explains the cause of the exceptional position held by London :—" It is owing to our having first established a trade with all these countries, a trade more important than each carries on with other countries, that ours has become the supreme money market Banking follows trade, and if our trade for any reason :whatever were to be restricted, were to be confined within narrower channels, then with absolute certainty others to whom this trade would fall would also oust, us from our supreme position in the international money market." But it is not bankers only that this change would affect. They are but the channels through which trade passes, and you cannot close the channels without checking the stream. " Every one of our industries, and our whole trade, and the employment of our working population is, in the United Kingdom more than in any other country, dependent on the unimpaired maintenance of our banking system, and that again is largely dependent on our position as the bankers of the world On the greatness of our banking resources the greatness and development of our resources must depend." We have made more extracts than usual from Mr. Schuster's paper because in so highly technical a subject it is safer to give the very words of the expert. But it is not only on technical matters that Mr. Schuster deserves to be listened to. He puts with great point and clearness the objections which have frequently been urged against any disturbance of our fiscal system,— the mutually antagonistic character of the three policies " often mentioned together as if they could be carried on simultaneously," and the danger of deriving our food supply from a single source. We have seen lately what mischief may be done to the great industry of Lancashire by the shortage in the cotton crop in the United States. " What would happen if a shortage in the crops were to occur in Canada ? " And " what would. happen in time of war if we had only one Colonial source of supply? " The whole advantage of our food coming from a neutral country in the ships of a neutral Power would be lost. It may be said that we should only have to fall back on the United States, and that so long as the war lasted we should go on getting our corn as we do now. But " all the machinery of trade, shipping, and other matters are easily destroyed but are not quickly regained."
We do not expect Mr. Chamberlain to pay the slightest attention to these arguments. His mind is too absolutely made up, his convictions are too unalterable, to allow of any faltering in his purpose. But Mr. Chamberlain, though he may be the real Prime Minister—the wording of his letters and telegrams certainly suggests that he is so in his own estimation—is not the nominal Prime Minister, and it is possible that Mr. Balfour may yet rouse himself from his more than Merovingian inaction and show some sense of the obligations which his position lays upon him. There are three points in Mr. Schuster's appeal which ought to come home to him. There is the absence up to the present of any genuine inquiry. The fiscal controversy has been raging for months, but the only contribution the Government has made to it is a Blue-book which furnishes, not conclusions, but materials for conclusions. It has proved. an excellent handbook for speakers on both sides, but the electors want something more than this. We can hardly suppose that Mr. Balfour holds that the appointment of a Commission by Mr. Chamberlain makes it unbecoming in the Prime Minister to seem to trespass on his prerogative by appointing another. No doubt convinced Protectionists might urge that after instituting an inquiry as to how an average 10 per cent. duty can best be levied, it is a step backward to institute a second to deter- mine the earlier question whether any duty at all shall be levied. But the nation is not made up of wholly con- vinced Protectionists. It is largely composed of men who wish for further guidance before making up their mind, and to these the Report of a strong, uncommitted, and not too large Royal Commission would be most welcome. The second point is the extent to which the position of the City of London in the financial world would be affected by the limitations which a Protective system would necessarily impose upon trade. A leading banker ought not to be able to say at the end of more than six months of fiscal controversy that the interests of the chief city of the Empire—the chief commercial city of the world—and of all the many financial and industrial enterprises which depend on its co-operation, have been put aside without notice. Mr. Chamberlain may think it needless to take account of such trifles, and the new Chancellor of the Ex- chequer may only be anxious to further the purposes for which the office was assigned to him. In the same way, Mr. Chamberlain may think the additional difficulties thrown in the way of our food supply in time of war by drawing it wholly from inside the Empire not worthy of consideration. But the .Prime Minister cannot be indifferent to any one of these considerations without falling short of his plain duty. That Mr. Balfour would not willingly have this said of him we are sure ; but in a time like the present the inaction which springs from hesitation may pass only too easily into the inaction which is indistinguishable from neglect.
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