rithmic curve Y=Aext in which Y is the mean percentage annual increase of the exports taken over periods of five years.

A is the basis of the curve taken from the first period free from any abnormal changes. e is the basis of the natural logarithm,

viz., 2.718.

K is the logarithmic decrement taken over the whole period.

tis any time or year considered.

From 1875 onwards there is a remarkable abnormal falling off. Continuing the logarithmic curve to J, we see what would probably have been the percentage growth had no abnormal variations occurred. Assuming therefore that the growth had been as shown by F J. I obtain a continuation of the export curve BK, which would have been the true curve of exports onwards had matters followed the normal. In that year (1875), there commenced a remarkable stagnation which, with considerable variations, has continued ever since.

I show on the same diagram the actual growth of the exports from Germany and the United States, and though no striking change is visible until 1896, there then comes a bound up in each country, which may account for much of the loss of exports from this country. The area contained by the dotted line B K and the solid curve BCD, is a measure of the trade lost by this country during the twenty years, from 1880 to 1900. It represents £412,000,000, and if one half of the value of this business represents labour, and the change is due to new fiscal systems of other nations, then it means that the working classes lost £206,000,000 by the trade operations of foreign countries during those twenty years.

I next give a similar kind of diagram showing the imports of manufactured goods into this country including those from the United States, Germany and France. Repeat

ing the same procedure as in the case of exports I obtain, in addition to the curve ABCD, which shows the actual amount of imports, a curve B C E, derived from the logarithmic curve F B G, which shows what the imports would have been had the rate of growth been normal and in the same proportion to the growth from 1855 to 1880. It is seen that there are two areas B C and CED, which give us trade gained or lost in the period 1880-1900. It shows a net increase of imports of £80,000,000, which means a loss

of home trade, in addition to the loss of £412,000,000 in our export trade mentioned above. To what is this to be attributed?

1. Is it due to our having reached the limit of our producing power at home?

2. Is it due to fiscal prohibition in other countries?

3. Is it due to the successful competition of other countries in our own markets?

4. Is it due to the emigration of capital to that prohibitive, but rapidly developing country across the Atlantic and elsewhere?

There are no statistics to enable us to answer these questions, and they are of sufficient importance to justify special enquiry.

The last query is of great importance to our working classes; for at home capital and labour work hand in hand, they are essential to each other, but if capital emigrates to another country, it is the other country that finds the labour, and our people at home go to the wall.

PRICES, LABOUR, AND COST OF LIVING.

The changes in the level of prices of all commodities, shown in Diagram III., taken from the report of wholesale and retail prices, upon which the logarithmic curve is drawn, indicate that a slow, steady decrease has occurred since 1800, but varied at times by wars, famines, commercial depressions and elevations. It is clear, however, that the law has not been disturbed by any fiscal changes, though there is a very remarkable temporary fall in 1850, following probably the repeal of the Corn Laws in 1846.

The diagram also shows changes in the general level of money wages during the period 1860-1902, taken from the Fiscal Blue Book, (Appendix xix., p. 259), by which it seems that again a general law is at work, raising by regular continuous movements the percentage growth. This change is very nearly the same in all countries. It may be due to similar causes, and if so, it cannot be due to Free imports, for other countries have applied the reverse policy of Prohibition. But the curve showing the cost of living is more startling, for it shows a very considerable decrease in the period 1878-1902. The working man in the United Kingdom can now buy for £5 what cost him a quarter of a century ago £7. That in the United States from 1883 to 1900 exactly coincides with the United Kingdom. The improvement in France and Germany has been much less, in fact the cost of living has been practically stationary. We have here distinct evidence of some advantage we have gained in the United King

dom over France and Germany. As regards food stuff, the United Kingdom and the United States pay no duties. But, on the other hand, both these countries have received great benefit from engineering improvements and the reduction of freights. I have menioned that wheat, which in 1873 cost 75. per quarter to be transported from New York to Liverpool, cost only 10d. in 1901. The repeal of the Corn Laws in 1846 was followed by a rise in the price of wheat, and when the import duty of is. per quarter was finally removed in 1869, again the price of wheat actually rose ! It is therefore difficult to argue that the reduction in prices is due to the removal of taxation. In fact the most careful examination of the tables and the curves in the Fiscal Blue Book fails to show any influence of fiscal changes on prices. We must rather look to improvements in the methods and economy of production, in the convenience and rapidity of transportation, in increased facilities for the conduct of business, and for the storage and distribution of materials for the great benefits that we have experienced.

The home price was taken as 50s.*

The cost of producing wheat in Canada per acre has been very carefully calculated and described.

The average yield is 18 bushels per acre, and the selling price in the local market 2s. per bushel or 16s. per imperial quarter. This means a profit to the farmer of 3s. 6d. per acre after paying labour, rent, and interest on capital. The Americans are trying by a combine to enforce a uniform charge of 4s. per bushel.

The operations of the Canadian farmer are ploughing, seeding, harvesting, thrashing, and transport to market.

"Annual Register, 1842," p. 31.

If we assume that every 1 lb. of wheat becomes 1 lb. of bread, then the consumer in London pays 60s. per quarter when the quartern loaf costs 4d. How is the difference of 44s. to be accounted for ?

Dealer No. I. buys his wheat in the local Canadian market. His operations are-1. Buying. 2. Transport to port via railway. 3Storage in docks.

Dealer No. II.-4. Buys and pays freight. 5. Storage in bonded docks in England.

Dealer No. III.-6. Buys in England; pays tax (if any). 7. Distributes to English markets. Dealer No. IV.-8. Purchases in local market, or in Mark-lane. 9. Distributes to miller.

Dealer No. V.-10. Miller sells to shop. Dealer No. VI.-11. Baker makes into bread and distributes to (12) consumer.

Here we have twelve distinct operations, each one of which demands a portion of the balance, and if the balance be equally distributed over them all, then each operation absorbs 3s. 8d. per quarter.

Who pays the import tax? Is it Dealer No. II. or Dealer No. III.? If the import duty were as it was, is. per quarter, then the mean cost per transaction would be 3s. 7d. If 2s., then 3s. 6d., the same as the farmer earns in Manitoba. It seems an absurdity to imply that the consumer would pay the tax when there are so many interested merchants wishing to take the risks of business, amongst whom it can be distributed, and whose profits are so great that a mere 1d. or 2d. difference would be immaterial. It was a very different thing in 1846, when a duty of 20s. was imposed, then the tax, as my figures show, was prohibitive. There is a vast difference between a high prohibitive tax and a low defensive tax. The former falls chiefly on the consumer. This is shown by the fall in our own exports the foreign importer prefers to buy in his own market. It is shown by the tin plate business in America. It is shown by the price of corn in Germany and France. But when a tax is merely nominal, as the is. export duty on coal and the Is. import duty on corn, it is quite impossible to perceive, either in the tables or charts, any effect on the markets. Only last September the price of wheat fell 5s. per quarter, but it had no effect on the price of bread. Those who argue that taxation falls on the consumer, invariably rely for illustration

He really pays more, for 1 lb. of wheat does not give 1 lb. of bread.

upon very high tariffs-in fact prohibitive duties-and on this point there is no difference of opinion. The true art of fiscal policy appears to be to adjust the tariff so that while on the one hand the tax adds materially to the revenue, it does not interfere with the market, and it gives a weapon to favour a preferential treatment of those countries which are prepared to deal fairly with us. With free imports of wheat from Canada, the 2s. tax must be paid by the exporter in the United States, and it would certainly stop the operations of any combine in the United States to raise the price of wheat to 4s. per quarter.

I have already

or acceptance of tenders. referred to the deterioration in the capacity for work turned out per day, and to the action of trade-unionism; but there are other matters influencing the character of many classes of our working men that are causing much concern to his employers-intemperance, gambling, irreverence, and sport.

It is difficult to draw any conclusion as to the relative merits of foreign and British workmen in the absence of complete returns, for the difference in the value of money, in habits of people, rate of wages, hours of labour, and modes of payment, are so very variable in

While the price of wheat in New York is virtually the same as that in London, the price of the quartern loaf which is now 44d. here is in New York 10d. The American citizen pays heavily for the vagaries of his peculiar fiscal system.

While the cost of living has materially diminished and the general course of moneywages has increased, how has the mean work turned out by the individual workman, per unit time, day or hour, fared? There are no statistics dealing with this point, but there is an admirable memorandum in the Blue Book discussing the matter. It is a most important subject for economical consideration. It determines the manufacturer's or producer's price to the consumer, and decides the rejection

different countries. American wages in many trades are nearly double those in the United Kingdom, nevertheless it is asserted that the works cost per unit of work done is the same in each country. If this is so, and I believe it to be true, it shows that the American workman does much more work per hour than the Britisher. I have visited the United States several times and I have had many opportunities of studying the working man there. I have the highest opinion of his ability and capacity. He lives in a better atmosphere than our men at home, and he is filled with loftier aims. "We are all sovereigns here," said one of them to me. The patriotism of the American of every class is his distinguishing feature.

COAL.

It is estimated that 227,095,000 tons of coal will be raised in the United Kingdom in 1903. Of this 30,000,000 (Fiscal Blue-book, p. 97) will be exported for the use of our foreign competitors. The total coal production of the world is about 700,000,000 tons, of which this country produces rather less, and the United States rather more than a third. Our Cclonies produce about 24,000,000 tons. The export tax is is. per ton. Peel made it 4s. per ton. Why should it not be restored to this? Coal is virtually the only raw material which we export. The supply is limited. It must come to an end. What will posterity say to those politicians who have wil

October, 1871, and March, 1873, there was an advance in the price of coal at the pits' mouth of 15s. 6d. per ton, while wages in this period were advanced only is. 1d. a ton.

TEA AND SUGAR.

Diagram V. shows the influence of taxation on the prices of tea and sugar during the period 1871-1902. A mere inspection of the diagram upon which the logarithmic curve is drawn, is sufficient to show that fiscal action did not affect market prices. In spite of the fact that duties were imposed the fall continued. Even when the duty was relaxed on tea in 1890 the market price rose.

fully allowed our competitors to rob us of our chief support, and hastened the decay of our country? Their policy is suicidal. If prohibition were ever justifiable, it would be in the case of coal.

I give a diagram IV. showing during the period 1882-1902 (1) the estimated value of a ton of coal at the pit's mouth; (2) the declared value F.O.B. at the exporting port; (3) the price paid by the consumer on delivery in London.

Space alone prevents me from analysing the distribution of this enormous difference. It was estimated by Fawcett that in 1872, when a great rise took place in the retail price of coal, "no less a sum than £81,000,000 was taken in a single year from the consumers." In the West Yorkshire district, between

IRON AND STEEL.

The iron and steel business in the United States has attained gigantic proportions. In 1902 the total production of pig iron was 17,821,307 tons, an increase of over two millions on 1901, over four millions over 1900, and double that of 1897. This far exceeds their own demands, and to maintain their large economical output they are "dumping" their supplus production in our open market and supplying our shipbuilders and ironmasters at prices much below the market price. Germany for similar reasons has been sending here girders and shipbuilding material, steel bars and billets for making sheets, tin-plates, bars, and wire, and selling them below cost price. Our manufacturers are bound to buy in the cheapest market, and in their own defence