Commons Chamber

Order for Third Reading read.

Motion made, and Question proposed, "That the Bill be now read the Third time."

I beg to move to leave out the word "now," and at the end of the Question to add the words "upon this day three months."

In rising to move this Amendment I find myself in a difficulty whether to treat this Bill as a serious fiscal proposal or as an ephemeral political freak. Its origin is dubious. We do not know at what font, if any, it was baptised. It started with a number of congenital infirmities, and it now emerges, to a large extent, emasculated and devitalised. It is indeed a pathetic and ironic figure. It has had, I agree, one great advantage in the detached, dispassionate interest of its foster-father the President of the Board of Trade. The President of the Board of Trade, if he will allow me to say so, is one of the mildest-mannered buccaneers that ever embarked on a marauding cruise. Appearances are very deceptive, and he, as all who have followed this Bill through the Committee and Report stage of the proceedings will agree, well repays looking after. He has shown extraordinary agility—Parliamentary agility—in the course of these manœuvres. At one moment he hoists the Jolly Roger of Protection, to the passing satisfaction of my hon. Friend the Member for Chippenham (Mr. G. Terrell). Then, in the twinkling of an eye, he hauls it down, and we find him interchanging flag waving amenities with my hon. and gallant Friend the Member for Central Hull (Lieut.-Commander Kenworthy)—altogether I think a very remarkable and memorable Parliamentary performance.

It would be unfair not to acknowledge that in some not unimportant respects, largely owing to the searching criticisms of my hon. Friends who sit behind me and around me, the Bill has been pruned in the course of the Committee and Report stage, of some of its most noxious excrescences. In particular I refer to two. First, the Committee which has been called into existence has now to take into account the effect which the import duty would have on employment in other industries for which the imported manufactures are really the raw material. I myself dealt with that point on the earlier stages of the Bill, and I am glad our arguments in that respect have not been without effect.

There is another provision which, though I cannot call it an improvement, at any rate to some extent counteracts what would otherwise be the deleterious effects of the Bill, and that is the Amendment which has been introduced requiring the Committee to report that production in the industry manufacturing similar goods in the United Kingdom is beng carried on with reasonable efficiency and economy. Those changes are, no doubt, for the good, but on the other hand, see what it all comes to. The fact that these changes have been made only emphasises the point I am about to make. It means that you have imposed upon this unhappy Committee, already over-loaded with a crushing burden of "ifs" and "buts," the duty of these additional investigations in a field, or rather in two fields, which I do not hesitate to describe as being full of hazardous speculation and of infinite conjectural possibilities.

I say, quite deliberately and advisedly, that a tariff, with all its vices and all its drawbacks, would in many ways be better than this, and why? A tariff works automatically. Everybody knows what it is, and every producer or trader can make his arrangements in advance with a full knowledge of the conditions to which he will be subject; but here, under this Bill, he is at the mercy of the determinations of a Committee, uncertain, precarious, perhaps capricious, and constantly changing. He will never know what duty is going to be imposed, or may per-adventure be imposed, upon the materials the price of which is an essential ingredient in his calculations when he is making a forward contract. He will never know what those contingencies may be, and thus to a large extent his business will become a game, or rather a gamble of probabilities. I think it would have been better to have a fixed tariff rather than this capricious, fluctuating system of the government of trade by Committee. It cannot be better put, or more forcibly, or with more authority, than in the declaration recently issued by the bankers of the United Kingdom, where they said:

What does this Bill do? There is no question of an economic war being carried on such as was contemplated at that time by the enemy countries, and if there were, what is the effect of this Bill?

This, Bill, as has been proved over and over again in the course of these Debates, and as I will myself show in a moment, is directed—I will not say with intention, although everybody must be presumed to intend the natural consequences of his acts; I do not say whether it is the intention; I daresay not—but it is directed in effect, not against our ex-enemies, but, more than against any other Power, against our Allies in France. There is a great deal of unnecessary mystery hanging over this matter. Is it not the case that the French Government have sent a protest based upon that very consideration? The House, I think, will be glad to know, and I think it ought to know, what the terms of that protest are, and what answer has been made by His Majesty's Government. I was surprised to see that, in the discussions to which I have been indirectly referring, those who spoke on behalf of the Government, or the most important of them, made the announcement, that the attention of the French Government had been called to the recent increase in the French tariff, which was introduced with the avowed object of safeguarding French industries from foreign competition.

Is this Bill, then, the first step in a policy of retaliation against the new French tariff? That would be, I will not say defensible, but, at any rate, an intelligible explanation of some of its provisions, which, otherwise, are a mystery beyond the mind of anyone to fathom. This is a serious matter, and although it has been referred to more than once in the course of the Debates, I should like to ask the Government exactly how we stand in regard to our Treaty obligations. It was not, I think, discovered until the Bill had got into Committee that the effect, at any rate, of that part of it which deals with the depreciated exchanges and allows the imposition of import duties in that respect, was in direct controvention of the commercial treaties which we have with a number of foreign powers—I think 26 in number. Some of them, of course, are, from a trade point of view, comparatively unimportant, but the House ought to bear in mind that, among the 26 that are excluded, so long as those treaties are current and not denounced—and we were told yesterday that there was no present intention to denounce them—among the countries excluded from the operation of all the provisions of this Bill which deal with exchange are Italy, Japan, the United States, Belgium and Portugal, which are among our Allies, and Switzerland, Sweden and Norway among the neutral countries. Those are only a few of a very long list, and, really, when you come to look at it, so far as what are called, roughly, the exchange provisions of the Bill, the only countries of competitive commercial importance to which they apply, or could be made to apply, unless and until these treaties are denounced, are France and Germany, and whatever remains of the Austro-Hungarian Empire, and, I presume, Czecho-Slovakia. That shows that, so far from this being a measure to carry out the intentions and-purposes of the Paris Conference, it is directed to a totally different quarter.

I pass to the examination of the actual provisions of the Bill in its restricted and capricious scope. I will not waste many words on the first Part, which deals with key industries, or what are called key industries. In the good old days of Protection, the key industries were agriculture and shipping. The Corn Laws were passed to safeguard the one, and the Navigation Laws were passed to safeguard the other. That was good, honest, whole-hearted, full-blooded Protection, and it was directed, many of us will admit, and history shows, if by a misguided conception of policy, at any rate to a great purpose—to keep alive and in a flourishing condition the great staple industries upon which the trade of the country depended. Let us look at the key industries of the present day, according to the conception of the framers of this Bill. The Schedule mentions theodolites, spectroscopes, measuring cylinders, galvanometers, pyrometers, electroscopes, wireless valves, and hosiery latch needles.

May I ask my right hon. Friend if he will remember that the latch needle is absolutely essential to the lace trade, and is very important?

I will not go through all the list, and I will make my hon. Friend a present of the latch needle. I have taken a few of these typical key industries, to which the whole of Part I of this Bill is directed. I do not really think it is worth while to waste much time over them. I come to what is the real essence, so far as there is any real essence in this Bill, and that is Part II, which deals with what is called dumping, and with the depreciation of the exchanges. I will say one word about dumping in the technical sense, because it is a remarkable fact that so far as I know, in the whole of these discussions, not a solitary case has been produced to show that British industries as a whole, or, indeed, any important industries of any kind, are suffering at the present moment from dumping in the ordinary intelligible sense of that word. Really the whole stress of the argument, such as it has been, has rested upon the new problem supposed to be presented by the depreciated exchanges. With regard to that, I would ask for two or three minutes the serious attention of the House. What is the question that the House has got to consider? It is whether a tariff of 33⅓ per cent., which only operates against a small number of selected countries, which, it is admitted, will be entirely inoperative against the great bulk of our commercial competitors—whether a tariff of 33⅓ per cent. will be either a remedy or a palliative for the undoubted confusion which is produced by what are called the collapsed exchanges.

There is a great deal of confusion of thought, as well as of language, about this Question of exchanges. Very few people, it would seem from the course of these discussions, are able to see or to realise that a depreciated exchange, a depreciated currency, for international purposes is not an unmixed benefit to the country in which it exists. Some of the speeches to which I have listened have really represented Germany—the German mark down as it is!—I do not know what the present figure is—240—

Two hundred and ninety.

Somewhere under 300—that Germany has been singled out as a special favourite of Providence in the warfare of international competition; that a depreciated exchange gives the country in which it exists an artificial bounty—if you may call it so—in its export trade. It is forgotten that on the other hand it exposes the country as an importing country to a corresponding disadvantage in exactly the same degree. Take Germany as a crucial instance. Germany is no doubt an exporting country, that is to say, it has a large export trade. I believe it is a fact at the present moment—certainly it was the case last year—that Germany is importing more than she exports. The imports from Germany into this country—that is, the export of German goods to this country—were, I believe, less during the last six months than during the corresponding six months of last year. At any rate she is not producing from her own soil the raw material for which many of her most flourishing and progressive industries depend, and has been obliged to get that raw material from elsewhere and to pay for it in her own depreciated currency; therefore Germany is far from being in a protected or favoured position through a depreciated exchange.

I myself have always taken the view—allowing that there are startling cases of individual hardship owing to the importation of German goods into this country at a lower price than they could be made by the British manufacturer—that you have got to look at the thing as a whole. It is a vast international problem of the most complex kind. There is one way and one way only—I have said this before, and I repeat it to-day—one way only in which the confusion and the chaotic fluctuations in the exchanges can be brought right, and that is by restarting international trade on the broadest possible basis and by interposing no obstacles of any sort or kind on either the exportation or the importation of goods which, the different countries require; by recognising what is really—if I may say so—the first lesson in the economic alphabet of international trade. After all, the figures of the exchanges are merely a temporary barometer. The fundamental, bedrock fact of international trade is that it is a question of the exchange of goods and services. That is what it comes to. You will never get the exchanges right with tinkering proposals such as this. You will only get the exchanges right by encouraging the whole world to devote itself to production and the interchange of those things which it enjoys by nature, or for which it has an aptitude and the best facilities and advantages.

Supposing, however—and to my mind it is the fundamental objection to any such proposals as are in this Bill—supposing you were going to deal with this subject, the worst possible way is by means of import duties. What could be more ill-conceived than the method here adopted? You are going to interpose, wherever the conditions exist and subject always to the hampering and disabling provisions of your commercial treaties which exclude a large part of the world from the operation from this part of the Bill—you are going within the limited area, the patchwork area, in which the Bill can operate, to impose a uniform import duty of 33⅓ per cent. What could be more absurd? I am now conceding for the purpose of argument that the thing is in any sense practicable or workable. The depreciated exchanges are depreciated, as everyone knows, in almost infinitely varied ways. Not only so, but they vary from time to time, almost from day to day. I was ignorant of the exact extent of this. I spoke of the mark as though it stood at 240. My hon. Friend corrected me and said 290. That has happened within a few weeks.

It was 240 12 months ago.

We need not worry about the exact particulars at all. The exchanges vary and fluctuate month by month and week by week, and sometimes almost day by day, and that is in the case of a particular country. As between different countries you have only got to look at the French and Belgian returns to see what enormous varieties of figures and fluctuations there are there. How can you pretend to deal practically—I will not say economically—with a condition of things like that, when you impose a flat rate, a lump duty, of 33⅓ per cent. entirely irrespective of the state of the exchange, or the country? It does not bear argument. I have not heard the slightest arguments that would justify that position.

If you ask, "What is your alternative?" my reply is that I am not obliged to produce one, because I say that the whole thing is nonsense, and you ought not to touch or handle it in any shape or form, but rely upon the only real healing influence that is at work, namely, the opening of markets and the free interchange of goods. The alternative is very difficult, and that shows the impolicy of handling this question at all. The alternative would be a graduated or fluctuating import duty. I am told that Spain has adopted a procedure of that kind, and she is finding it almost impossible to work. But is that an argument in favour of a flat rate? That is manifestly unjust and inadequate for the purpose for which it is imposed, and it is no answer to say that there is another method which might be even worse or more absurd. The whole of this problem of the exchange is one which cannot be dealt with effectively, and ingenuity cannot contrive the means to deal with it effectively by the imposition of an import duty.

That really is the whole of the Bill. The safeguarding of the key industries may really be almost laughed out of court. Dumping, in any scientific or unscientific sense of the term, is practically non-existent, and as to the exchanges you are debarred by treaties which you are not going to denounce, and which, if you did denounce them, you could only do so by imperilling the best interests of the trade of this country in the limited area in which they operate, because they are illogical and unworkable. I think I have already strongly asserted in this House, when the Paris Resolutions were under discussion, that there were certain industries, the products of which were useful or even indispensable in time of war, which we informed the House that it was desirable we should look after. There was nothing in the Paris Resolutions which compels anybody to forsake, mitigate, or modify in any way their existing fiscal system. On the contrary, all the countries who were parties to those Resolutions deliberately retained a perfectly free hand as to the manner in which they would act upon them. So far as some of these industries are concerned, the products of which are essential in time of war, the proper way, as I have always said, of giving State encouragement and assistance is by the open and candid participation of the State in the form of a subsidy, or whatever it may be. I know there are great drawbacks to that, and it is not to be lightly recommended, but, at any rate, it has this advantage, that whatever is done is done in the light of day, and that you can limit the profits as we sought to do in the case of the dye industry, so that the surplus may be applied to scientific research and the improvement of processes, and the profit will not go into the pockets of one favoured body of producers, but will be shared by the community as a whole.

That is the obvious advantage of proceeding by that method. It should be adopted sparingly, although there may be cases in which it is justifiable, but the worst possible way in which you can deal either with these exceptional industries, or with the productive trade of the country as a whole, is by this niggling, half-hearted attempt to introduce a tariff. I heard the hon. Member for Chippenham (Mr. Terrell) make a remark which I thought was so pathetic in its candour that I felt almost inclined to go and sit by him at once, or at any rate hold his hand. He said, in a broken voice, the voice of a thoroughly disappointed man, that this Bill has been whittled away, but there is still something in it. While I agree that there is still something in it, what is in it is bad in itself, and still worse as a precedent and example for future times. It is on these grounds that I ask the House to reject the Bill.

When a man is thoroughly happy himself, happiness is apt to radiate from him, and if on this 12th August we are kept in the House of Commons, at any rate my right hon. Friend has given us some very good sport. In the happy revival of an old controversy he has renewed his youth, but has somewhat blurred his middle age. During the period of the War, when we were actually engaged in a life and death struggle, the right hon. Gentleman admitted that all of us, himself included, had been too careless of our national security, and that we had learned a lesson which we must never forget. "Never," somebody has said, is a word which politicians should not use. With the right hon. Gentleman, "never" scarcely covers five years. The right hon. Gentleman was a little hampered in his speech, because he could not make up his mind whether to say that the Bill has been improved in its passage through this House, or whether it had been defaced or deformed. In one sentence he took one line, and in another he took another line.

What has the House done? It has made no change in the principles embodied in the Bill at its first introduction, but it has made certain alterations which, at any rate, in the mind of the right hon. Gentleman, ought to be improvements, for they were directed to only three or four principal purposes. One was to preserve the complete control of this House over anything of a taxing nature, and to secure and require the active, instead of the merely passive, consent of the House to what was done. Another was to protect the subject against any possible fear of injustice or Departmental partiality by providing that cases of dispute should be referred, not to a referee appointed by a Government Department, but to an arbitrator appointed by the Lord Chancellor. The third change was to guard against a danger which many Members feared, and against which it was perfectly proper to guard, namely, that the Bill might preserve an inefficient and inactive industry against the results of its own inefficiency and want of activity. The fourth was to provide that the Committee, in coming to a decision as to whether serious unemployment was caused by the circumstances set forth in the Bill and brought to its notice in a particular case, should look, not only at the direct unemployment produced, but also at the effect on employment among the direct users of the goods for the protection of which application was made.

12. P.M.

Those are not great changes, and they have certainly not destroyed the Bill. They have in some respects, undoubtedly, as the right hon. Gentleman pointed out, added to the work of the Committee, and complicated the Measure; but I venture to say that every one of those changes was in accordance with the general sentiment of the House during the discussion of the Bill, and was welcomed by the House when my right hon. Friend accepted them. The right hon. Gentleman made great play with the work which this Committee will have to do. He told us that it was not his, business to find an alternative. May I remind him of the origin of this Committee and of these recommendations? It is the Balfour of Burleigh Report a Report of a Royal Commission described by my right hon. Friend himself in glowing terms as regards the eminence and competence of its personnel, and the value of its recommendations. What did they say—

My right hon. Friend made one speech on this subject. He was then very proud of the Resolutions. He was so proud of them that he wished it publicly known that they were drafted by the British Government. More than that, he was so anxious to make it clear to every Liberal and Free Trader that they were the pure milk of Liberalism and Free Trade that he confided to the House that they had actually been drafted, not by some desperate Tariff Reformer who had got into the Government and was working mischief there, but by his then President of the Board of Trade, Mr. Runciman. It is therefore to Mr. Runciman that fell the major portion of the defence of the Government's policy on these Resolutions, and it is to him—my right hon. Friend will not blame me for it—that I turn for the true exposition of the mind of the Government which passed the Paris Resolutions. Mr. Runciman said:

You were his colleague.

Certainly I was, and I am quoting it to show that when that Government of which I was a member passed the Paris Resolutions we meant something. We were not merely doing a bit of vulgar bluff, as the Prime Minister of that Government now attempts to persuade the House that we were.

I never said or suggested anything of the kind.

The right hon. Gentleman suggested that as Germany had issued a threat, therefore we thought it necessary to issue a counter-threat; but, Germany having been beaten and the circumstances having passed away, no importance is to attach to these solemn Resolutions, and no conclusion can be drawn from them. I say that that does not represent the mind of the Government at the time, and the Members of the Government of that day who were parties to the Resolutions have not cause to complain of my defending the Resolutions as meaning what they said, and as being intended to be acted upon, but of the Prime Minister of that day, who now comes down and says that he hoodwinked his colleagues and that they meant nothing.

I must protest against that. I never said or suggested anything of the kind. I have never repudiated in any shape or form the responsibility for the Paris Resolutions, or ceased to defend them.

No, but the right hon. Gentleman's defence takes the form of saying that they mean nothing. Yet these particular Resolutions, dealing, not with a temporary emergency arising during the War, but with permanent measures to be taken after the War, are the proper and true foundations of the Measure he is now asking the House to reject. Then the right hon. Gentleman proceeded to examine the three Parts of the Bill. He read out from the Schedule a certain number of industries scheduled as key industries. He said that in the old days we used to consider that agriculture and shipping were key industries, but we now put in a series of articles, optical glasses, latch needles and the like, and he says that that is absurd and ridiculous. The right hon. Gentleman—I ventured to make the observation before in reply to a previous speech, but as that reply was given on the following day here, he was not present and did not hear me—the right hon. Gentleman is labouring under a confusion of language which perverts his whole thought on the subject. He does not understand the difference between key industries and staple industries. Agriculture, shipping, iron and steel, these are staple industries. Woollens and cottons are staple industries of this country. What do you mean by "key industries"? Will anyone say that optical glass is a staple industry, that dyes are a staple industry? No, they are not; they are not comparable in magnitude, extent or financial importance to the great staple industries. Does the right hon. Gentleman mean that on that account they are not to be protected; does he mean that only the great staple industries should be protected, and that that is what he had in his mind when he came back from Paris? I will favour the right hon. Gentleman with one quotation with which to refresh his memory. When our colleague came back from Paris, he expounded the admirable work which they had done. He said:

"The Allies, as we conceive it, are under the bounden duty to take every practical measure to secure for their own use supplies which are produced in their own territories and to prevent any German control such as existed in some cases before the War.

Does that require legislation?

I do not think it will. I refer to the commodities in regard to which German control existed before the War. The House is familiar with many of them—dyes, spelter, magnetos, and optical glasses."

Am I not right in saying that while my right hon. Friend is renewing his youth to the delight of us all, he has blurred his middle age? There is not an industry included in the Schedule which is not essential to national existence during war, and as to the very latch needles which the right hon. Gentleman scoffed at—let him think for a moment—the absence of the power to manufacture, these latch needles in this country was a great impediment to us at one part of the struggle. Yet that is not a key industry within the meaning of key industries, it is not necessarily one of the great staple sources of employment or wealth in the country, but it is an industry without which the national existence is not secure. That is the justification for the Schedule of this Bill.

My right hon. Friend then turned to dumping and dealt with it very briefly. I never have been able to understand the frame of mind of those who profess strict and orthodox Free Trade on the subject of dumping. Again and again I have seen them driven out of the absolute position that dumping is always an advantage to the country into which the goods are dumped, and forced to admit that in some circumstances and under certain conditions it might and would be proper to take measures of Protection against it. But those conditions may, in the opinion of the speakers, conceivably have occurred in the past, and may conceivably occur in the future, but they are never a reason for action to-day. think the better motto is to act in time, and we invite the House of Commons to take this Measure without waiting until the evil has fallen upon us in overwhelming volume.

Then we come to the lapsed exchanges. Let me first say a word as regards the treaty position, and I do not think it will be clear to anyone who may be guided solely by my right hon. Friend's speech. He has treated the difficulties, such as they are, as affecting the only provision against dumping caused by depreciated exchanges. Was it worth while to deplore that such was the treaty position? The Bill cannot affect the United States of America. We are not likely during the duration of this Measure to see the dollar exchange depreciated in terms of sterling. Then as regards Japan, my right hon. Friend fears that the Bill will be inoperative because the treaty position will prevent our employing this protection against a depreciated exchange in the case of Japan. But the Japanese exchange is not depreciated.

I did not say it was. The right hon. Gentleman totally misconceives the argument I used. I was not talking about the exchanges in those countries at all. My argument was entirely independent of that. I was pointing out the inequality and the absurdity of applying a Measure of this kind by a patchwork to particular countries and not to others, whatever the state of the exchange might be.

In that case I am afraid I did misunderstand. I thought the right hon. Gentleman was mentioning America and Japan in connection with the treaty position. He included them in a list which he read out of countries with which we had treaties that would prevent the Bill from operating. I say that if there were no such treaty position, the Bill would not operate, because there is no depreciated exchange. That is also an answer to the right hon. Gentleman's complaint that the Bill will not act equally where there is a greatly depreciated exchange, as in Germany, and where there is an appreciated exchange, as in America. Of course, it will not. It will not act at all in the one case, and it will act in the other. The right hon. Gentleman and I are agreed about one thing, namely, that it is not true policy for a country, and least of all for our country, deliberately to depreciate its currency. That is not, I am sorry to say, a doctrine held by every one in this country.

Not on the Treasury Bench.

It is held by everyone here, I think. I never know where differences of opinion may arise on exchange and currency, and I discuss the question with all humility, having observed how often those who undertake to instruct me in public have failed to clear up their own minds. But I should like to deal with the argument of the right hon. Gentleman. I say that the view which he and I hold on this subject is not held by everyone in this country. That is not at the moment important, but the opposite view is held by a very large number of people in other countries, notably in Germany, and to a marked degree in Belgium. There is a whole school of political and economic thought on the Continent which, in defiance of the Resolutions of the Brussels International Conference, and in disagreement with all our own Committees, is deliberately urging a policy of depreciating exchange, at once to lighten the burden of internal debt, and to stimulate, by a bounty on exports, the economic reconstruction of the countries to which the policy is applied. That has a bearing upon the provisions of this Bill in relation to exchange. Granted that, as my right hon. Friend and I think, that school of thought is unwise, and that those countries are taking action which in the long run will be suicidal—granted that we are right, is the evil confined to them in the meantime? No, Sir. Until they have learned the lesson that success cannot ultimately and permanently be obtained in that way, the countries which are the victims of their policy suffer while they gain. The immediate gain is theirs; the immediate loss is ours. The permanent loss, we believe—those who hold the views that my right hon. Friend and I hold—will be theirs; the permanent loss may also be ours.

Is it possible to talk on a subject of this kind without having every word judged in terms of the controversies of 50 or 20 years ago? Free Trade was by its authors and propounders intended to indicate a system in which throughout the world trade would be left to its natural course, with no artificial impediments raised anywhere, and no artificial stimulants administered anywhere. When you give a bounty, whether it be through the exchange or otherwise, to interfere with the natural course of things, you give a special and an artificial stimulus to production in that particular place. It may not be, and probably is not, the place where those goods could be most economically produced; it may be that in our country we have greater natural advantages and have a thriving industry. Are we to allow, not competition under ordinary circumstances, but an attack created, fostered and sustained by artificial stimulants, to drive our own industries out of existence? If you do that, what security have you that, when the artificial stimulus is removed, you will ever be able to reconquer the field you have lost? The workmen are dispersed; the factories are closed or devoted to other purposes; the capital is lost. What you have suffered, you have suffered for all time; what you have gained, if you have gained anything by buying below the cost of production and accepting this gift from your enemies is a momentary cheapness in certain articles, followed by the permanent loss or crippling of one of your industries consequent upon your permanent or prolonged dependence upon foreign sources of supply for articles which previously you had been able to produce, and had produced in order to supply yourselves.

Let me add one other observation of a more general character with respect to this matter. A great deal is said, and rightly said and thought, about the export trade; but upon what does the export trade rest? It rests upon the home trade. It is the balance and the surplus of the home trade, and, unless it has the home trade as a foundation, our export trade will shrivel and perish and die. Do not let anyone think that there is more than a momentary or accidental or apparent contradiction between the interests of the home trade and of the export trade, for their fortunes are indissolubly linked, and the one cannot exist without the other. I turn again directly to the question of exchange. I say that no doubt in the long run exchanges must tend to stabilise themselves —either to recover or to stabilise at a new level. I admit, with my right hon. Friend, that the larger the export of goods from a country with a depreciated exchange, and the smaller the import of goods into it, the more quickly the exchange will recover, and the more it will recover. I submit, however, that we cannot afford, while that process is going on, to see our own industries ruined, in order that the industries of other countries may recover. I say more—and this is vital to the problem with which we are dealing at this part—what is it that we are legislating against? It is not a depreciated exchange; it is a depreciating or a fluctuating exchange. The duty is to come into force where goods are being sold or offered for sale at prices—and these are the words I want the House to mark—which, by reason of depreciation in the value in relation to sterling of the currency of the country in which the goods are manufactured, are competing unfairly with our own. Why do they compete unfairly? How does the evil arise? That is a point upon which my right hon. Friend never touched, but it is vital. Why do they compete unfairly? Not because the mark has fallen to 200 or 300, but because the value of the mark internally is different from the value of the mark externally. As long as the mark is depreciated, there is a bonus in favour of the exporter. The equivalence of the internal value to the external value is always a lagging equivalence. It always takes its time to make it up, and in the meantime every fresh fall gives an increased bounty. This Bill is not aimed at the depreciated exchange as such when it is stabilised at the new level at which its value internal and external is the same, but is aimed at the consequences which follow when the exchange is still falling, or fluctuating, and when therefore there is no stabilisation, but there is a difference between the internal and the external value which amounts to a penalty on the purchase of articles by that country and a bounty on the export of their goods to us or to other countries.

The right hon. Gentleman said this evil is fluctuating and variable. So it is. How then, he said, can you treat it by a uniform duty. What, he asked, could be more absurd. There is only one thing that could be more absurd and that is the alternative form of duty which he mentioned only to condemn, a duty varying with every fluctuation of the exchange. The right hon. Gentleman desires to be precise, logical and complete, and one of his reasons for asking us to reject this is that it is not logical and complete. What was his alternative? It is a duty fluctuating with every fluctuation of the exchange according as the value of the article is the result of internal production and manufacture or external purchase. That would be not only absurd, but perfectly impracticable and unworkable. We therefore do not adopt it. We adopt a Measure admittedly incomplete, admittedly not perfect, but roughly adequate for the purpose for which it is proposed, and we say it is better to do that than to fold our hands and do nothing. The Heavens may fall. We are powerless. Industries must take their chance, and if they cannot be saved they cannot.

The right hon. Gentleman is not prepared to say we should do nothing. What is the alternative which at this moment, with all the experience we have got and with the financial situation, the right hon. Gentleman offers? He says Government expenditure is too high, and if only the Government would listen to him how much better off the country would be. What is the alternative the right hon. Gentleman presents to the House and the country? A system of subsidy and participation in commercial enterprise. Let me take subsidy first. There are cases; where you are driven, but of all the alternatives that are open to us it is the last I would adopt. It is a direct charge upon the Exchequer. It is costly. It is very difficult to see that your subsidy is wisely used and directed to the purposes you would wish. You must either give your subsidy out and out, and trust that with that aid the people to whom you have made this gift will show the energy, the enterprise, the skill and the persistence which are necessary to secure success, or you must keep your finger for ever on the business by your representatives in it, and do that in detail which the House is begging us every day to abolish. As fast as we decontrol an industry, we are to establish a new and particular control of particular industries because we subscribe capital to them or give them a grant from public funds. I cannot imagine a more fatal policy alike for the public exchequer and for the interests of industry. I am content, on that ground, and, taking that as the right hon. Gentleman's alternative, to ask the House to decide between a reasonable measure of protection against exceptional, artificial, and destructive causes, and a policy of subsidy to some businesses and subscription of capital to others, with the deadening effect on industry, with the hampering and meticulous control, and the angry and invidious Debates in this House which any such policy would certainly produce.

It is with very great reluctance that I feel obliged to put myself in opposition to this Bill on the Third Reading. I find myself in danger of going into the same Lobby with hon. Members opposite. If there is one thing which would have made me vote for this Bill, it would have been the arguments they have used throughout these Debates. Every argument they have used has tended to confirm what I originally held, that the key industry provisions and the anti-dumping provisions, properly so-called, are good and will probably in their measure be efficacious. I approve them, and I am prepared to vote for them, and certainly if a vote was to be taken on the issue just laid down by the Lord Privy Seal, there is no doubt as to the way any of us would vote. The proposal of subsidies in regard to key industries is quite the most laughable thing which has ever been proposed even from the benches opposite. The idea is based on this, that the difficulty of a key industry is that it cannot sell it goods, and you propose to ask the State to subscribe capital to a company which cannot sell its goods, and, therefore, to throw a certain amount of money away. That is obviously absurd. Then you come to the subsidy proposal, which is designed to enable that company to sell its goods below the cost of production, because it receives a subsidy from the State for that purpose. Having received the subsidy from the State for that purpose, to supplement its manufacturing costs, it is then to use the same money all over again. I do not know how it is going to duplicate the money for the purpose of encouraging the scientific side of the industry. The thing is absurd.

Why?

It is absurd because you cannot use the same money twice over. If you have already used it to supplement your manufacturing costs, because you were selling below the cost of manufacture, you cannot use it again to engage additional chemists and pay them to teach you science. To do that you would have to double the State subsidy. That is what it all comes to. Spend as much money as you possibly can, with as little effect as possible. I do not believe that any argument has been brought forward which really touches what I would have liked to regard as the two main provisions of this Bill. In regard to the collapsed exchanges the situation is entirely different. There I do not think any argument has been brought forward in justification. It may possibly be thought by some hon. Members to be out of proportion for me to vote against this Bill on that point when one aproves of the other two main provisions of the Bill. I do not think so. There are two arguments which would make it appear out of proportion. One argument is that this particular Bill will not have very much effect. It has been considerably watered down. In debate it has been so surrounded by safeguards that it probably will not be put into force in any very great number of cases, even if it is ever put in force. I cannot believe that that is a reason for voting for it, because it is inoffensive and innocuous. The Preamble lays down the principle that its object is to protect British industries against collapsed exchanges, and some hon. Members would ask me to vote for it on the ground that the Preamble is illusory and will do nothing of the kind. During the last two or three years we Lave had too much of compromise legislation, so watered down by compromise that it affects nothing, good or bad, but it leads the people of this country to suppose that something is being done, when really nothing is being done. [An HON. MEMBER: "That is what the Coalition does!"] I cannot accept that interpretation. I do not think that in the last two and a half years the proposals put forward from that side of the House were any more effective or any less a compromise. They were hopeless compromises between moderate liberalism and extreme socialism, and those compromises would have had precisely the same effect. That being the case, I cannot see why I should vote for this Bill. Indeed it is a reason for voting against it, because it is only another legislative farce.

There is another argument to show that the attitude I take is not one that is out of proportion. It has been argued by the Secretary to the Overseas Trade Department that there is no real difference in principle or practice between this provision as to collapsed exchanges and the anti-dumping provisions, properly so called; that they arise from the same set of factors, more or less; and that they are being appropriately dealt with by the same procedure. There is one great difference in practice between the two. Your anti-dumping duty is put on goods imported from abroad and sold in this country at less than 95 per cent. of the free on rail price in the country of manufacture. Therefore, to put it no higher, they are sold at only a small margin of profit in this country. A duty of 33⅓ per cent. will have a very real and stringent protective effect in that case. On the other hand, when we are dealing with the collapsed exchanges we are dealing with goods produced so far below the cost of production here that they can be imported into this country and sold below the price at which the home manufactured goods can be sold, and yet leave the foreign exporter a margin of profit which would amount to as much as 100 per cent. There your 33⅓ per cent. duty would have no protective effect whatever. That is the difference in practice, and when I hear the hon. Member trying to convince us that they are the same thing I say, "Well, they may be the same thing in some remote region of theory to which I have not yet penetrated, but they are not the same thing in practice. One protects the British industry and the other clearly does not."

There is another difference between the two provisions, but I am afraid the points are somewhat complicated. Dumping, dangerous dumping, properly so-called, almost always happens from behind a tariff wall, therefore, your anti-dumping duty, properly so-called, is in the nature of retaliation. It is a corrective, and I think it is a good corrective, and that it has proved to be a good corrective. Of course, that is a matter for argument. It is a corrective against the tariff wall of the exporting country, but this duty against the depreciated exchange country has nothing whatever to do with the tariff policy of the exporting country. The supporters of this Bill may say, "That is perfectly true; but it is closely connected with the fiscal policy in the other country, the policy of depreciating the exchange deliberately by the manufacture of paper money." That argument is the only one which approaches an effective argument for this provision in the Bill, that we are faced with a deliberate policy of depreciation in Germany, which is aimed at our manufacturing supremacy and our manufacturing prosperity, and, therefore, we must meet it. That is an absolute economic fallacy. To a certain extent it is true that if you manufacture paper money inside the country you would depreciate the internal value of that currency less quickly than you will appreciate its external value, because the foreigner has probably less confidence in the credit of the issuing Government than the citizen who is a subject of that Government. You will be found out sooner by the foreign observer than you will be found out by your own people. Temporarily, at any rate, that may lead to a difference between the external and the internal value of the mark, but that is a, very passing thing, and only a slight thing, and that is the only respect in which the manufacture of paper money within the country can affect the relative external and internal value of the currency of that country. You depreciate your exchange by manufacturing paper, but you do not create by that means the difference between the internal and the external value of the mark. That seems to me to be the fallacy of that argument.

The fact is—and this is the main ground and principle on which I have decided that I must vote against the Bill—that at the end of the War there were two alternatives open to the Allies and to the nations of the world. You might continue to control trade as you have controlled it, control it internationally, and by a system of international agreements you might break the effects of the War as to the value of the currency of the various countries, and you might be able really to effect what it is proposed to effect by this Bill, to mitigate the chaos of inter- national exchange, and international trade, on the morning after the War. Or you might leave the whole thing to the corrective of a free exchange of goods. Those were your two alternatives. I confess that towards the end of the War I was rather in favour of the first. I do not take the extreme view which is held by many people of the extraordinary wisdom of the business man in this or any other country. He seems to me to commit as many mistakes as other people, and the effect of his mistakes is not, as is popularly supposed, confined to himself, and I think that it is arguable that unemployment at present, and general industrial depression, are greatest in those countries where decontrol took place the soonest after the War.

That is arguable, but at any rate we did not take that course, and probably we could not. We went in for decontrol and the maximum possible freedom of trade. The vast majority of hon. Members of this House advocated that persistently, and the Government, if they did not believe in it, bowed to it. Having taken that course you cannot now try to turn back, and in some little niggling way try to mitigate the effects of the policy of freedom which you have deliberately adopted. This whole provision seems to be, in so far as it is operative, bound) to be operative arbitrarily without any duly considered scientific effect, and will only pro tanto —we can only talk about this extraordinary Measure in terms of pro tanto: one has to water down one's views when speaking of a watered-down Bill—delay the righting of the economic situation which we desire to right. For this reason do I believe that this is a purely illusory Measure, that the people, workmen, and employers in this country have been led to believe that it is something real, and that the controversy over it leads them to suppose that there is some degree of benefit to be obtained from it at the very moment when it is all important that we should strip ourselves of all impediments for the fight of international competition in foreign markets. At the very moment when it is essential that we should reduce costs as rapidly as possible you are pretending to give the manufacturers in this country some modicum of Protection which, if they rely upon it, they will find will betray them, and will be to their dis- advantage in the face of foreign competition in foreign markets.

My right hon. Friend the Member for Paisley (Mr. Asquith) in his opening remarks suggested that it would be very much better if we had an out and out tariff Bill in the place of the present Measure. With that view I am in complete agreement. I think it would be very much better and much more effective, but it is hardly open with my right hon. Friend to find fault with the present Measure on that acount. I believe that if it had not been out of feelings of great delicacy towards the Members who are supporting the Government, and certainly to Members on this side of the House, the Government would have introduced an out and out tariff Bill, because there is not the shadow of a doubt that a tariff pure and simple is the only effective way of counteracting the difficulties from which we are suffering at the moment. Germany is the chief offender. France and Belgium have also been sending large quantities of goods here—[HON. MEMBERS: "Shame!"]—and it has been directly proved, and I think that it is admitted, that those goods which are sent at prices against which you cannot possibly compete in this country are the cause of a great deal of the present unemployment.

Surely it is desirable to attempt to do something, even if it is only half-measure, which will cure the evil from which we are suffering. Unemployment here is real. These imports do not account for the whole of our unemployment. Strikes are largely responsible. [HON. MEMBERS: "Lock-outs!"] Taxation, high prices, and a variety of other causes are responsible, but when we look at Germany we find that the fact is that workshops in Germany are working to their utmost. Trade is good, and booming, and I am told on very good authority that the ships which are leaving German ports for countries all over the world are loaded with merchandise. Germany by her present policy of depreciating her exchange is able to sell at the greatest possible advantage. It is necessary that we should consider our own position. I am not going to refer to those parts of the Bill which relate to key industries or dumping pure and simple. They are comparatively small matters as compared with the collapse of the exchanges.

The point which has filled me with a great deal of apprehension is the announcement made yesterday by the Government that they do not at present propose to apply this Bill to France or Belgium. I am not quite sure on the point. I have endeavoured to ascertain by reference to the OFFICIAL REPORT. Our hands are free as regards France, and I should like my right hon. Friend (Mr. Baldwin), when he replies, to state clearly and definitely whether, in the event of representations being made to him that industries are affected under the terms of the Bill by the importation through the collapsed exchange of goods from France and Belgium, he will set up the necessary Committee and take the necessary steps in the form described by the Bill? As far as I was able to gather yesterday, this Bill, though it will contain powers which make it applicable to the whole world where there is a collapsed exchange, yet for present purposes is intended to apply only to Germany. Having regard to the extent of the collapse of the German exchange, I am afraid that the Bill is not going to do very much good. It will help some industries. The important point which I wish to make, and which may induce the Noble Lord opposite (Lord E. Percy) to reconsider his decision to vote against the Third Reading, is that even if the duty does not stop German goods coming here, it will, at any rate, produce revenue, and certainly that will be something which is all to the good.

Who is to pay?

1.0. P.M.

During the greater part of the Debate it has been said that when you impose a Custom Duty the consumer pays that duty. We have heard nothing of that line of argument to-day from the Leader of the Opposition. As far as this Bill is concerned, without a shadow of doubt this Customs duty will not add to the cost of any imported article by a single pennypiece.

I wish to make a short reference to a speech delivered in this House on the 13th July by the hon. Member for Whitechapel (Mr. Kiley). That speech seems to me to be so inaccurate in many details as to require some correction. I am afraid that the hon. Member is very careless in regard to some of his facts. He made reference to that collection of samples which has been so repeatedly referred to in the Debates, and he stated that "the prices were nearly all wrong." The hon. Member added that he had asked "what was the authority for the prices" and apparently there was no authority for them. I wish to read a short letter from the director of the Exhibition who accompanied the hon. Member for Whitechapel over the Exhibition. The director says:

I call attention to both these matters because they have been repeated in the Press with the object of belittling the importance of this Measure and the steps which manufacturers are taking to urge the Government to put it on the Statute Book. I hope the Bill will pass its Third Beading with the substantial majority it has received at every stage. It is an experiment. I think many of us are agreed that a tariff would be better, but at any rate, from the political point of view, this may be regarded as a stepping stone and as showing the utter hollowness of the opposition which is being raised to any Measure for the safeguarding of our industries. Although I am disappointed that the Bill has been whittled down, I propose to give it my complete and hearty support.

I have listened with great interest to the Debate on the Third Reading of this Bill, and my object in rising is to justify the Bill by a test case, and also to tender to the President of the Board of Trade the thanks of the commercial community for the great trouble he has taken and the patience he has shown during the progress of this Bill through the House. The particular test case which I ask the House to consider, is one to which reference is made by the right hon. Gentleman the Member for Paisley (Mr. Asquith). It is that of the latch needle manufacturing industry. I ask the House to consider what was our position in this connection when the War broke out. This particular item was not manufactured in this country at all at that time and within two months after the outbreak of War, the Government found themselves faced with a serious situation regarding the production of hosiery for the Army and Navy. It was almost as serious as the situation with regard to munitions. When one comes to consider the comparative insignificance of this particular article, either to the value of the product produced by the machine, to which it is affixed or the value of the machine itself, I think they will realise that this is, in substance and in fact, a key industry. The machines upon which these instruments are used cost from £70 to £80 each, whilst this little product—without which the machines stand idle and unprofitable—is represented by a present cost of something like 1½d. It is therefore interesting to know what happened in regard to this particular industry and its bearing upon the present Bill, and the solution offered by the President of the Board of Trade. Obviously something had to be done in connection with this industry to enable us to carry on during the War, so the Government induced a number of firms to put down the necessary plant and capital in order to get them out of their difficulty. After the War we find this industry has developed and is fully equipped to take care of this particular essential, and this Bill provides the means whereby the industry can be kept alive and the country relieved from the risk of ever again finding itself in the parlous plight in which it found itself soon after the War started.

Objections have been taken to this Bill, upon broad grounds of general policy and along the line that economic michief will be done by it. The House can test the merit and worth of the Bill by taking this one particular example, which, I say, justifies the Bill in the eyes of the commercial community and of all who regard our national safety as part of their economic programme. Many objections have been raised to this Measure on the ground of its effects on the consumer and on the price of commodities. Much play has been made with the admissions, in that regard, of the Minister of Health. The House will therefore be interested to know to what extent the application of the duty, in connection with this key industry, will affect the consumer. This is very easy of calculation, and it has been agreed as between the manufacturers of this particular latch needle that the effect will be as follows. If the 33⅓ per cent. extra, were to be paid on all needles used by hosiery manufacturers, they would only have to advance the prices by less than one-tenth of one per cent. and hosiery to the value of 16s. 6d., at present, would cost one-sixth of a penny extra. I hope that those who propose to vote against this Bill, on the ground that it imposes an additional tax on the consumer, will have their fears allayed, at any rate, in this particular direction. I would be too optimistic if I expressed the hope that any case, however bad, could be sufficiently proved from the point of view of that type of mind which is represented in this House and in the country, and is known as the Free Trade mind. I have long regarded that as a hopeless proposition. I am not making this statement with the faintest hope of making the slightest impression upon that type of mentality, but merely to justify this Bill to the other minds in the House. It is a Bill which, in my humble judgment, will be of considerable help and support to key industries and other industries as well. I notice that the right hon. Member for Paisley dismissed these key industries as being of very slight importance and value. He, and those who think with him, have very materially changed their mind with regard to the value of this particular industry, as compared with what they thought of it in the latter days of 1915 and in the earlier days of 1916. From that point of view, I think their criticisms in regard to key industries are entirely unfounded. I regard these industries as vital to the interests of the country, and the Government is to be congratulated on introducing a Measure which will give sufficient encouragement to manufacturers, and ensure that we shall never revert to the position existing before the War. I wish to quote to the House what has been written by one of the principal manufacturers of these needles: other industries which they have scheduled as key industries, and I am satisfied that we may look forward to the operation of this Bill as resulting in permanent and lasting benefit in the trading interests of the country.

I do not want to give a silent vote on the Third Reading of this Bill, as I did on the Second Heading. On the Second Reading I gave a rather uneasy but silent support, and I gave it in the hope that one of two things might happen—either that I should hear, in the course of the detailed discussion, some argument which would set at rest the very grave misgivings which I confess I felt, or, on the other hand, that the Bill would be so amended in Committee—I had almost said so emasculated in Committee—as to remove those objections altogether. Neither of those things has actually happened. It is true that certain Amendments have been made in the Bill, and I want to say at once that if this Bill consisted only of Part I, that is to say, of the provisions in Regard to key industries, it would have, on the Third Reading, my enthusiastic support, because in regard to that Part of the Bill I think the Government have on the whole established the case which they set out to prove. I do not deny that there are grave difficulties in regard to the definition of a key industry. I suppose that every Member of the House has been inundated, as I have been, during the passage of this Bill with circulars from traders and trade associations, each pointing out that their particular trade must be regarded as a key industry. Therefore, there is very grave difficulty in regard to the definition of what is or is not to be legitimately regarded as a key industry; but with reference to those industries which are actually enumerated in the Schedule of this Bill, I feel no sort of misgiving whatever. They may, I think, as the Lord Privy Seal said, be regarded as key industries, although they are carefully to be distinguished from staple industries, and with regard to that part of the Bill I have no criticism, still less any opposition, to offer. Indeed I hope, in reference to what fell from the hon. Member for Central Nottingham (Mr. Atkey), that I am not at any rate so pedantic in adherence to any economic theory as not to admit the force of facts so plain to see as those to which I am alluding.

Therefore, I accept this portion of the Bill, but my difficulty in voting for the Third Beading is, I think, sufficiently expressed in the Resolution to which I have given my adherence, namely, that the Bill,

Pounds sterling?

Quite so, and I admit the pertinence of that question. Money value is, of course, important, but I was going on to call the attention of the House to the position of things, not in regard to money values, but in actual tonnage, and here I will deal with our exports in the year 1913. In that year our exports in tonnage were 91,803,000, and in the year 1919 our exports in tonnage had fallen by about a half, that is to say, to 45,993,000 tons.

Is that in regard to a particular commodity? As a total, it is quite wrong.

I assure my hon. Friend that these figures, astonishing as they sound, have been carefully checked, and are absolutely correct. Of course in 1920 the fall was still more marked, namely, to 39,509,000 tons. Now I will look, for a moment, at the most recent tonnage figures which I have, namely^ the tonnage for the first five months of 1921; as compared with 1913, when they were 37,106,000 tons, they were reduced to 9,439,000 tons.

Does that include coal?

I took the trouble to-take out the figures for May, and, excluding coal, the figures for that month of our exports in tonnage show a decline of 65 per cent. as compared with 1913. If these figures are even approximately correct—and if they are not, I shall be corrected by my hon. Friend below me (Mr. Bigland)—they disclose a very grave condition of affairs, and the question which I am compelled to ask myself is this: How is the Bill which we are now considering going to improve these conditions? I am leaving on one side altogether the question of key industries, of which, I have admitted, I approve, and I come to this conclusion. The Bill is proposing to improve this condition of affairs by imposing a tariff of 33⅓ per cent. against certain countries on the ground of depreciated or depressed exchanges. What is the effect of these depreciated exchanges? On the one hand, everybody admits that they act as an artificial bounty on exports from the country which is suffering from—or shall I say enjoying?—depreciated exchanges; but, on the other hand, they equally act as an artificial barrier against imports into the country of depreciated exchange. There is only one way, as it seems to me—and here I agree with the right hon. Member for Paisley—of curing this disease, and that is by a reconstruction, as far as one can reconstruct it* of our international trade. I followed very carefully the argument of the right hon. Member for Paisley this afternoon, and I entirely dissociate myself from his remedy with regard to key industries. I agree with my hon. Friend the Member for Hastings (Lord E. Percy) on that point. But I thought that with regard to the question of depreciated exchanges, the right hon. Gentleman unanswerably exposed the folly of a flat rate against exchanges which must, in the nature of things, be constantly and perpetually fluctuating. At the same time, as I hinted just now, his speech has made it for me, and perhaps for some others on this side, difficult to give a vote on this Bill, because, as I said just now, I dissociate myself entirely from his alternative remedy with regard to key industries. On that point I am whole-heartedly with the Government, but I feel so strongly with regard to the—may I use the word?—folly of the expedient which has been accepted with regard to countries which are enjoying—or, shall I say, suffering?—from depreciated exchanges, that I have no alternative but to associate myself with the Resolution which stands on the Paper in the names of the Noble Lord, the Member for Hastings, and others of my friends.

I have no intention of entering into a discussion of a political nature with reference to the general provisions of this Bill. I believe that has been adequately and very efficiently done during the various stages of the Bill from this side of the House. The point I desire to raise at this juncture is that I believe it will be exceedingly difficult for the Government to get any support for the Bill in the country. There is very little opinion, so far as one can judge, in the country in support of this particular proposal. I go further and say that what opinion can be focussed in the country is in the direction of hostility to the Bill. Many of the larger industries in the country have had the Bill under consideration. They have discussed the matter, and they have circulated their considered opinion. I propose to reinforce the declaration that I made a moment ago by quoting from the findings of some national organisations which have had this Bill under consideration. I put forward, in the first instance, the declaration of the wool trade in the manifesto which they have circulated. I quote this one paragraph: of the country. If we turn to the cotton trade, the position is much more pronounced. A manifesto has been issued on behalf of that particular industry, and in the last paragraph of the manifesto this is the last declaration:

Finally, having strengthened the position from various industrial undertakings, I now come to the bankers. The banking interest in this country is admitted, I think, to be the pulse of national prosperity. We can feel at any time through the banking system of the country the condition which prevails industrially and commercially. This is what the bankers, in their manifesto, say, and this is their considered judgment on this Bill— trial development today is in the direction of monopolies at home, and Imperialistic adventures abroad. What we do say is that our Free Trade principles will minimise the evils that arise from that development, whereas any form of Protection will intensify these evils. That, generally, is the position of labour upon this matter. Organised labour has had this Bill under consideration. I have here the manifesto issued by the Parliamentary Committee of the Trades Union Congress and the executive of the National Labour party. Speaking in the name of organised labour, this is what these two organisations say:

The Labour party's position in this matter is very clear. We have moved from small national industries in the direction of the wider international operations of trade. We have to move in the direction of stabilising or balancing international labour conditions on the lines of the Labour Convention, arising out of the League of Nations. The Bill before us does not do these things. It makes no attempt to do them. It simply supplies a very small section of the community with certain tactical advantages which would react adversely upon the rest of our population, and the only support the Government has been able to give in justification of their action is that it was an election pledge in 1918. The condition of things in 1918 and those which prevail now are altogether different. The Government would be very hard put to it to secure any backing in the country so far as the rank and file of the population are concerned. I believe that when an election comes this particular matter will be kept in the background. It will be camouflaged by the League of Nations, and other high sounding declarations. For the moment, however, we are confronted with the fact that not only organised labour, but organised commerce, industry, and finance, have all made tremendous pronouncements against the Bill. These pronouncements I think, are sufficient justification for the appeal made for the rejection of this Bill.

I think I am the only Member of this House who signed the Report of the Balfour of Burleigh Committee, and It has been a matter of great disappointment to me to find right through these long Debates that the whole question has been discussed in a political atmosphere rather than in a commercial and industrial atmosphere, so that there might be shown the advantages and disadvantages and counter balances of the one side and the other. As a member of that Committee the last speech came to me as a complete surprise. On that Committee were recognised representatives of the Labour party. They voted in a certain direction—which I am going to explain to the House—I understand after consultation with their colleagues, and if so, and I want to show—and I think I shall be able to prove it to the House—that there is very little of this Bill that was not included in the recommendations of the Balfour of Burleigh Committee. If so, I hope possibly some of my Labour friends opposite may even be willing to reconsider their attitude towards this Bill. What was the history of the Balfour of Burleigh Committee? In those days it was looked upon as filling a most important commission. The reference to it was: understand, after consultation with the trade unions concerned. I know that dumping is not likely to be a burning question at the present time, and I do not understand that in any quarter there is any objection to the provisions of dumping pure and simple. What is in dispute is the selection of the key or pivotal industries, and the part which deals with collapsed exchanges. I am sorry to say that in my opinion I think the Balfour of Burleigh Committee, to a certain extent, have been the cause of some misconception as to the word "key" or "pivotal," but at any rate they made it clear that they did not refer to the great staple trades, and they say: This paragraph would not have been inserted in a Government Report in 1917, and the right hon. Gentleman must have forgotten that his Government did not look upon the Paris Resolutions as simply bluff upon Germany. I feel certain myself that the Paris Resolutions referred to the policy of this country after the War, and I was astonished to hear the late Prime Minister brush the catalogue on one side as something to be laughed out of court. I was astonished to hear that argument. I know that the country does not realise the importance of one or two things which are in the Schedule. One I wish to allude to is the last and it is organic synthetic chemicals. I am not concerned with these particular articles but I happen to know their relative importance, and what other countries think about them. In America today organic synthetic chemicals are considered to be articles of great importance which are only admitted by licence in the same way as we treat dyes, and they are subject to a duty of 25 percent. This shows the importance attached to this industry in America, and yet this is an industry which the right hon. Gentleman the Member for Paisley says ought to be laughed out of court.

I had an opportunity early this year of meeting one of the leaders of the German chemical industry, and I told him that I felt there ought to be an opportunity for an agreement between the two countries. If this could be arrived at we might obtain much assistance in regard to the method and practice of this enormous German undertaking towards putting our dye industry in a more satisfactory condition. At the present time it is simply fighting for its life. I want the House to. know what is the opinion in Germany of the organic synthetic chemical industry, which is in this Schedule. My informant told me "We are not prepared at the present minute to come to any agreement with any other country over these processes. In Germany, not only the chemical industry itself, but the German Government, look upon organic synthetic chemistry as the best commercial asset which the country possesses." He went on to say that in the opinion of most good judges it was even more important than the iron and steel industry. Yet this is one of the things in the Schedule that can be laughed out of court! I am confirmed in my own view by the last words of Lord Moulton. I want to reinforce what I say by a considered statement from Lord Moulton made only a few weeks before his death. This is what he said: of the most important industries of the future, a chance or is it going to be. left to the full blast of German competition; which will certainly lead to its drying up? If we had not passed the Dyes Bill in November—at that time there was a year's stock of German dyes in this.-country—and if that Act had been delayed till now, the British dyes industry would have had no chance of succeeding. Today it has a very hard fight, but unless that Act had been passed prior to this Bill, it would have had no chance of success.

2.0 P.M.

I want now to deal with the third' recommendation of the Balfour of Burleigh Committee for the assistance of other industries outside the Schedule, which may, on proof, require special assistance. As the House has already been told, this is safeguarded by the establishment of an independent inquiry. Before the Balfour of Burleigh Committee big industries like the steel industry came and pointed out the great difficulties of their position. I do not know whether the steel industry is going to apply for protection, but the collapsed exchanges do put these industries in a very difficult position. In my opinion, the policy of the German Government with regard to exchanges is a considered one. They want a depreciated exchange. They consider that it pays them and that inflation rather than deflation will enable them to get command of the export trade of the world. I do not think that this House has sufficiently realised how difficult it is for a country which is trying to stabilise exchanges to hold up its end against a country which is inflating its currency every week. That is the position in which many of our staple Industries are today. I hope it will not be necessary to give this protection, because, so far as I am concerned, the less tariff one has to impose the better.

We really cannot afford to ignore what may be the position. Suppose things become desperately bad. At the present time industries like the iron and steel industry, very largely because of the currency question in Germany, have to compete against prices at which it is quite impossible for our makers to produce. We shall have to look the position fairly and squarely in the face. Can we afford, if things come to the worst and if coal does not decrease in price, to allow an industry like the steel industry to be wiped out? If we do, it will be very difficult to resume. If we are going to be a first class commercial power, it is a matter for argument as to the balance of advantages whether this country can allow a big industry like the steel industry to be wiped out. If they do come and ask for protection under Part II of this Bill, first of all they have to persuade the commercial advisers of the Board of Trade that they have sufficient cause, and it is hedged about by all sorts of stipulations in this Bill. They have to satisfy the Board of Trade that they are not in fault themselves, that their methods and commercial economy are not at fault. They have to persuade the commercial advisers of the Board of Trade. The case is then sent to the Board of Trade for their decision, and they again have to examine it.

Finally it is to me a source of great satisfaction that before any industry can get an order under the second part of this Bill they have to present their whole case to Parliament, and therefore we shall have here all the arguments laid before us from the shipbuilding and engineering industries, pointing out that steel is their raw material, and that if you give the steel industry protection you will decrease their chances of securing foreign orders. We shall have all these arguments in the House of Commons. It is not going to be at all easy to bring any industry under the second part of this Bill. Having spent nearly two years in examining the question, and having proved to the House that there is hardly anything in this Bill which was not recommended by the Balfour of Burleigh Committee, with regard to dumping and key industries, recommended absolutely unanimously—even by the representatives of labour—and the third part of the Bill having been approved by many Free Traders, including myself, Sir William Priestly and Mr. Harry Gosling, I think it has been the greatest misfortune for the matter to be debated here in an atmosphere of party politics, rather than on the question of whether the balance of advantage tended one way or the other. I feel, as a Coalition Liberal, that the commercial policy of the Government as announced at the General Elec- tion was the policy of the Majority Report of the Balfour of Burleigh Committee. This Bill is an attempt to embody in an Act of Parliament the Balfour of Burleigh Report, a policy which was known to everyone standing for Parliament, and I do not understand the compunction of my Coalition Liberal colleagues in regard to voting in support of it.

We have had some very interesting theories advanced during the discussions on this Bill, and perhaps one of the most interesting was that put forward by the President of the Board of Education, the strychnine theory, the theory that this was a disease of the economic body to which it was necessary to apply a stimulus and that this stimulus was to be obtained by the application to certain businesses of restricted quantities of strychnine. I think the hon. Member who last spoke is also a disciple of the strychnine theory. His view of the Bill is that it is not one which ought to operate on a large scale, and that the fewer the industries that have to resort to its assistance the better it will be. He also pointed out to the House the difficulties of obtaining help under this Bill, difficulties perfectly consistent with the general strychnine theory under which, when you apply for a supply of strychnine, you can only obtain it under certain conditions and restrictions. The hon. Member has indeed indicated that one of his chief delights in regard to this Bill is the difficulty which will attend its being put into operation. His desire is that industries should develop in this country. None of us want this country to have to go outside for anything it can produce at home of equal quality and price. We have developed a big heavy chemical industry without any assistance from tariffs. But the suggestion is that we cannot get a fine chemical industry established in this country if we leave it open, as the heavy chemiaal industry is left open, to unfettered competition. It is suggested that it is not possible to develop such an industry here unless it gets some kind of assistance. That is the argument which has been put forward. I do not propose to combat it myself, but I would just like to quote a few words by a Member of this House, whose name, I am sure, will carry weight with hon. Gentlemen opposite. The right hon. Gentleman himself has been one of the principal developers of the heavy chemical industry. In dealing with this very question of key industries, which in the old days were infant industries, we have had a definition drawn between staple industries and key industries. The key industries to-day to which this argument applies were infant industries in the past, and these key industries are even now being regarded as infant industries. If they were full grown, robust industries they would not be brought under the operation of this Bill. The whole point about dealing with these particular industries is that they are infant industries. Let me quote to the House what the Minister of Health had to say about promoting the development of infant industries by a system of tariffs: alternative put forward by the late Prime Minister. He said that that alternative meant increased Government expenditure. Nobody wants increased Government expenditure, and nobody wants it for this reason, that the more the Government spend the less the taxpayer has to spend, for he finds the money. When the Government spend money they put their hands into the taxpayer's pockets and leave him with so much less to spend. That is the objection to increased Government expenditure. But there are two ways in which you can take money out of the taxpeyer's pocket. You can take it out by increasing his taxes, or by increasing the prices which he has to pay. The Lord Privy Seal complained that the method of the right hon. Gentleman the Member for Paisley means an increase in taxes. We complain that the method chosen by the Lord Privy Seal means an increase in prices, and that is admitted by the Government, speaking through the Minister of Health. It is perfectly true that the hon. Member for Chippenham does not agree with him, but the Minister of Health, speaking about this Bill, said that the object and the purpose and the end of the Bill was to increase prices. The country, therefore, is really faced with the alternative, if it be an alternative, of having increased taxation—which, after all, is open and direct and definite and certain—or of having to pay increased prices to which you can put no limit, and about which there is no certainty or definiteness.

I do suggest to the Lord Privy Seal, or in his absence to the Secretary to Overseas Trade Department, that what the Government are really doing is shuffling away their responsibility. If these key industries are necessary for national security, it is the business of the Government to see that they are developed. But let us have them developed at the smallest possible cost and with the greatest amount of certainty. There is no certainty under this Bill that we shall get these key industries. There is no certainty that 33⅓ per cent. is going to be sufficient to put the optical glass trade upon a sound foundation. Those who are concerned talk about 300 or 500 percent. There is no certainty under this Bill that you are going to get your key industries, but there is the certainty that a great many people are going to be able to increase prices against the British consumer. What the Lord Privy Seal has chosen is not the straight, open, honest path, if it be necessary to take it, of taxation, but that of allowing an infinite number of uncertified, unofficial, irregular taxing officers to dip their hands into the pockets of the consumers of this country and take out whatever they can get. The Lord Privy Seal scouted the suggestion, put forward by the right hon. Gentleman the Member for Paisley, of giving Government assistance. That was an impossible thing to do. That answer comes very curiously from a Government which has invested nearly £2,000,000 in British Dyes, I do not know what in British Cellulose, and other sums in Home Grown Sugar.

Does the hon. and gallant Gentleman advise the continuance of that policy?

I am not dealing with that. I am dealing with the Lord Privy Seal's argument, but I will deal with that. I certainly do not advise a continuance of the way in which this Government pursues that policy of investing money in concerns with inflated capital, of investing money without any security that you are going to get results, and without any limitation upon profits. I do not advise that method of pursuing that policy, but it is a policy which I think might be pursued under sound financial conditions and with proper securities for getting what you are after, and for the limitation of profits.

The main and most vigorous part of the Lord Privy Seal's reply was directed towards establishing the connection between this Bill and the Paris Resolutions, and the hon. Member for Limehouse (Sir W. Pearce) has been helping to form the chain. He says that the Balfour of Burleigh Committee acted on the Paris Resolutions, that this Bill conies out of the mouth of the Balfour of Burleigh Committee, and that, therefore, it is based on the Paris Resolutions. The Government are very anxious to establish the connection. They say, "During the War we came to certain conclusions and framed certain Resolutions. Now that the War is over, we are standing by those Resolutions, and you are running away from them." That is their case. It is a very necessary case for them to establish, and it is a case that we must answer, because, if it were true that during the War we-had formed certain Resolutions and were pledged to certain methods, and then, after the War, we abandoned those Resolutions and pledges, we should be in a position which could not be justified. But is that the case? Is it a fact that you can connect this Bill with the Pans Resolutions, and is it a fact that when we oppose this Bill we are opposing the Paris Resolutions?

The Lord Privy Seal says that the Paris Resolutions must have meant something, and we agree that they did. We say that they meant what they said. What did they say? I will deal first of all with the Preamble, and then with that part of the Paris Resolutions which treated of the permanent policy of the Allied Powers after the War. The Preamble, after reciting that the Allied Governments had met at Paris, goes on to say that they met for the purpose of fulfilling a mandate and giving practical expression to their solidarity of views and interests, and of proposing to their respective Governments the appropriate measures for realising that solidarity. That is what the Preamble says, and the Government bring forward this Safeguarding of Industries Bill and say that it is an appropriate Measure for realising the solidarity of the Allies. That is their case. But the amazing thing is that before the Bill is passed they have had a protest from the French Government, who are evidently not of the opinion that it is an appropriate Measure for realising the solidarity of this country with France. When we ask the Government about this protest, and what were its terms, and what was their reply, they do not tell us that they have replied to the French Government saying that this is a Bill which is an appropriate Measure for realising our solidarity with France. That is not their reply. It is this: "You set up a tariff against us, and this is a measure of retaliation against you." That is their reply. This is not a Measure for realising our solidarity with France.

I should not have interrupted my hon. and gallant Friend again, except that I think it is unwise, particularly at the present time, to attribute to the Government views in relation to France which have not been expressed by His Majesty's Government. It was never suggested by any speaker on behalf of the Government that this was a Measure of retaliation against France. What this Measure does is what Mr. Runciman a long time ago said it would do, namely, to ensure that there shall be no essential articles, either for the arts of peace or for the arts of war, upon which we cannot within the Empire lay our hands.

I accept what the Parliamentary Secretary has said. I do not want to put the point any higher than it should be put, but it is certainly within my recollection, and that of many hon. Members, that the impression was, not that this was a Measure, in the terms of the Preamble to the Paris Resolutions, for realising our solidarity with France, but that the Measure had some connection—I put it no higher—with the tariff policy that France was introducing. That certainly was the impression. The Parliamentary Secretary must not ride away from this point by dealing with the question of our diplomatic relations, and the necessary correctness and so on. The question is, is a Measure against which France protests a Measure which comes within the scope of the Preamble to the Paris Resolutions?

Let us now turn to that part of the Paris Resolutions which deals with permanent measures of mutual assistance and cooperation among the Allies. That is the final part of the Paris Resolutions, and we are here dealing with a Measure which is permanent not in all its parts, but in that part to which the greatest importance is attached by this House, namely, Part II. What do the Paris Resolutions say? They say, first of all, that it was decided to take the necessary steps and that the Allies would adopt methods which seemed to them most suitable for carrying out these Resolutions according to the nature of the commodities and having regard to the principles which govern their economic policy. Why was it necessary to put these words into the Paris Resolutions? I will tell the House what, in my opinion, was the necessity? It was that you were framing Resolutions, that an agreement was being arrived at, between nations which had different economic policies. You had Protectionist nations, and at least one Free Trade nation. You had them coming to an agreement, and these words were put in there, from our point of view, for the purpose of safeguarding the Free Trade policy of this country. There is no other reason for it. But they were not only put in because the nations who were parties to this agreement differed in their fiscal policy, but also, I suggest, probably because there was a difference of fiscal opinion amongst the Members of the Government of this country at that time. The British Government at that time was composed of men, some of whom were Protectionists and many of whom were Free Traders, and it may very well have been that these words were put in in order that the other side might be free to adopt what they thought fit in the event of their coming into power after the War. I am confirmed in that by what follows, because after the saving Clause is put in, "Having regard to the principles which govern their economic policy," they go on to give illustrations of the methods in which the policy may be applied, and three of them are laid down in the next Clause. They may, for example, have recourse either to enterprise subsidised, directed or controlled by the Government themselves. If after the War a Labour Government had come into power very largely committed to Collectivism, that is probably the method they would have adopted of carrying out the Paris Resolutions—the method of subsidising, directing or controlling by the Government themselves these various commodities. The second is Trade in its character, or Protectionist in its character, have chosen to follow the Protectionist method, and it does not lie in their mouth to accuse us of departing from the Paris Resolutions because we say we prefer the Free Trade method to the method they have chosen. I do not blame them for chosing their method. Those of them who are Protectionist are entitled to adopt Protectionist methods. I will not blame the Lord Privy Seal because he prefers the method of the Bill to the method suggested by my right hon. Friend the Member for Paisley, but it does not lie in his mouth and it is not within his competence to say that, the Paris Resolutions providing for a Free Trade method of carrying them out, there is any obligation upon Free Traders on this side or those on that side of the House who follow the Government in carrying out the Protectionist method which they have adopted, and that it is a Protectionist method there can be no doubt. It has been recognised as being so by the high apostle of Protection, the chairman of the Tariff Reform League. Speaking about this Bill, he said:

I hope the hon. and gallant Gentleman will forgive me if I do not follow him in his discussion of the Paris Resolutions, because it seems to me at this time of day that has become a matter of history. Politicians are generally interested in that particular kind of recrimination which consists in putting different interpretations on the same language. All I will say is that surely the language then was the language of belligerents. It was the language of people who wanted to find that phrase and that formula which would unite them in the common purpose of carrying on the War, and to lay special stress on this meaning or that meaning is, to my mind, to force history to your present purpose. The essential fact, to my mind, of the Paris Resolutions lay in the recognition that there were two kinds of war possible. There was the war carried on with deadly weapons and there was the equally deadly economic war. The threat on the part of Germany to which those Resolutions were a reply was a threat after the War to carry on an economic war. I am by no means convinced that such an economic war on the part of Germany is out of the question in the not far distant future and therefore, without dealing with that matter further, it seems to me that all those who adhered to the Paris Resolutions did adhere, at any rate, to the general thesis that economic warfare was possible and was threatened by the then enemy, and the only thing apparently that they have changed their minds upon since then is as to the possibility or probability of economic war in the future under present conditions.

I want to say a few words on this Bill because, owing to the fact that I was serving upstairs as Chairman of a Grand Committee, I was not able to give my attention to the early stages of the Bill, though it is one, as some of my hon. Friends who have sat in former Parliaments know, which deals with a subject to which I have in the past given some attention. I agree with the phrase which the hon. and gallant Gentleman quoted from the present chairman of the Tariff Reform League, that this is an epoch-making Bill. It is not a wholly satisfactory Bill, I agree. I am inclined to agree with the right hon. Gentleman the Member for Paisley (Mr. Asquith) that under normal conditions a tariff would be preferable, but a tariff at the present moment is impracticable and whatever we may think on matters of theory, as politicians we have to be practical, especially in a time like the present. It is not practicable because to frame a tariff which is to have any scientific basis is an enormous work. It took Germany seven years to frame that tariff which was such a weapon in her hands before the War, and to force a tariff through in a country like this, with all manner of views expressed in the country and in Parliament, would obviously take a very long time. It would probably be necessary to appoint Royal Commissions to consider the matter and then you would have a certain lapse of time for the digestion of the Reports and then, finally, you would have a long struggle here. After all, though some of us may be Tariff Reformers, we are patriots and we recognise that there are crowding upon one another all manner of vast questions at present and we have to take a practical line. That is one reason.

The second reason is that some of us, myself among the number, felt that it was more important at the present time to have a Coalition Government carrying on the business of this country during these dangerous years than it was to get the full fruition of any views that we might hold. Therefore, we welcome this Bill. I notice that in regard to the' first part of the Bill there is a tendency on the part of hon. Gentlemen above the Gangway to minimise its importance. In almost ridiculous terms the right hon. Member for Paisley exhibited either his ignorance of modern industrial conditions or his determination to be political rather than commercially scientific. The first part of this Bill is far the most important part. The second part may in future be important or it may not, but the first part is vital now, here, and always from my point of view. The hon. and gallant Member who has just sat down said that if you protect infant industries, and key industries are among the infant industries, you are nourishing vested interests. No doubt there is truth in that. I wish we could only recognise that in every course in politics there are pros and con. You have to take a choice among the various evils that beset you. I think it was Lord Morley who said that politics is one long choice of second bests. It is not really business to cite certain objections and then to write off completely the particular Measure you are considering, so far as you are concerned.

Let us recognise that there are dangers. What is the hon. Gentleman's suggestion? His suggestion is that you are to give a subsidy. If you give a subsidy, will no vested interest be created? You will encourage an infant industry to sell below cost, because of the Government subsidy, and when you abolish the subsidy will there not be an outcry of vested interest? The vested interest created by subsidies and the vested interest created by duties are equal, but there is a vast difference between them. If you give a subsidy you have to choose to whom you will give the subsidy, whether it is to be this or that firm or to such firms as satisfy certain conditions; but if you set up a duty, then all who are behind that duty, and who have the initiative, can try their hands and see whether, under the rules of the game you have fixed, they cannot win. The vital thing in regard to these key industries is that they are based on skill, they are based on genius, and what you want to give is a chance for genius to show itself and to be cradled, no matter from what quarter of the country it may come, and under what most unlikely conditions. That you can get under a system of duty, but it is extraordinarily hard to get it under a system of subsidy.

Most profoundly I disbelieve in the system of subsidy, but I do think it is necessary to protect your key industries. If you take care of your key industries, the staple industries will take care of themselves. We have heard much talk about steel. Every day steel is ceasing to be merely steel. It is becoming this kind of steel, or that kind of steel, tungsten steel, and other forms of steel. Steel has become specialised, and if you take care of the precious metals, the rare metals, the industries connected with the rare metals that temper, in this way or in that way, your crude steel, then you are taking care of the best part, the most valuable part, the most lucrative part, the most vital part of your steel industry. I believe it is possible, by taking care of your key industries, to take care of the whole industry of your country, staple or any other. The evolution of modern economics is very similar to the evolution of modern medicine. Time was, not long ago, well within the life of most of us, when the doctors considered what I would call the massive portions of the human frame, the muscles, the heart, those large organs known to every school boy. What is it now that the doctors think most about? They think of bacteria, of germs, all those minute imponderables which enter the human frame for good and for bad, and whether for good or for bad determine the characteristics of those larger organs to which formerly the doctors paid their main attention. If to-day the doctor could be sure in regard to the bacteria and the germs that are circulating in your bodies, the gross organs could take care of themselves. The whole chase of the doctors to-day is after that little population of imponderables which permeate the tissues.

So in regard to industry. We have reached a time wholly different from the time when we were treated to the crude economic medicine of Adam Smith or John Stuart Mill. We have reached a post War condition of things, and we must begin to think, not in the terms of our old controversies, but with some of the refinement of science and applied art. That is the difference between what is done in Germany and what is done here. An hon. Member representing the Labour party, a short time ago, made a speech in which he martialled before us, with very great effect, the views of this great interest and that great interest in the country, bankers, steel makers, the Labour party, and so forth, and he told us that they were in favour of the removal of controls, that they were in favour of a return to laissez faire, and that only in that way should we be able to restore the economic health of the country. Those very interests were saying exactly the same thing, in exactly the same impressive and united way, in the years immediately before the War, and yet when the War began, in the face of what they had said, this country lost tens of thousands of lives because of the policy which they had advocated. Now hon. Members come before us and tell us that the steel makers require steel to be imported if they are to manufacture in certain ways. Of course they do. Of course they represent their own interest. They are considering not the country as a whole, but their particular trade. No doubt they would say that their trade is essential to the country, and that they are, therefore, considering the country; but it is for this House to take a wider view.

It is for this House not to look at this interest or that interest, however great they may be, but to consider what is the advantage of the nation as a whole, and, above all, to consider minorities. This House differs from a mob because we protect minorities. Our industries consist necessarily from the democratic point of view of a certain number of great staple interests, which are capable of voting down all the minor industries, and if you leave them that power the result will be that these great staple industries will carry on to their own advantage and for a time will give great employment, but not looking to the far future, not looking to the nation as a whole, but shortsightedly considering their own daily work. If we allow democracy to work in that way it will not be very long before we see the end of democracy, because a nation which is not democratic, which is capable, as Germany was capable, of a coherent economic policy, will defeat you. What we have to do if we are to perform our part in a democracy which is not to be an economic mob, and in which the minorities which are equivalent to those germs, those bacteria in the human body are to be considered, is to protect those essential parts of industry which because of their smallness cannot protect themselves. Therefore, emphatically, so far as I am concerned, the first part of the Bill is by far the most important. The step which we are now taking is one which we ought to have taken many years ago. If we bad taken it there would have been tens of thousands, possibly hundreds of thousands, of young men of our race alive today who would have been ready to help our nation. We have paid terribly for our past dereliction. Let us not repeat it to-day. Let us go forward with some lessons learned from the past.

I have very few words to say in regard to the other part of the Bill, not because it has not a certain significance, but because the Debate has been devoted mainly to it and not to what I thought was in principle the most important part. Various arguments have been put forward with regard to dumping. The right hon. Member for Paisley (Mr. Asquith) drew attention to the fact that while depreciated currency may act as a bonus on exportation it is on the other hand detrimental to the nation from the point of view of imports. That is true, but—and I have my eye on Germany the whole time, because Germany is not disarmed, except temporarily, from the economic point of view—in Germany you have this condition of things. First, a large and highly skilled population; second, a certain amount of raw material which can be produced in the country. Practically the whole of the raw material for the synthetic dyes industry, being coal, can be obtained in the country. Therefore, what you have to fear, in the first place, is competition from the skill of a great population, and, secondly, there is the hunger of this population, suffering under economic disabilities which are being imposed on Germany. Therefore it sets to work on the raw material of the country itself.

That is a very dangerous state of things, because it means that instead of Germany turning out manufactured products along the whole gamut of industrial production, she will specialise in those particular things which either require a Very small amount of raw materials, as compared with skilled labour, or for which the raw material is obtained within her own territory. In those conditions she will not suffer so seriously from the fact that her currency abroad is depreciated, and you have a condition in which certain industries will be able not merely to dump because of exchange, but in which there will be old fashioned dumping based on largeness of production. It would be so today in regard to synthetic dyes if you had not taken special steps. The scale on which the German dye industry is carried on is such that she could easily afford to dump at the present time if she wished to do so and if she were permitted. Therefore I welcome as a great advance, whether it is immediately wanted or not, the fact that we shall put upon the Statute Book—what other countries have got—a provision giving us weapons in case of dumping being used against us.

Lastly as to exchange. It is argued that 33 percent. is useless. The Noble Lord the Member for Hastings (Lord E. Percy), I understand, is going to vote; against this Bill, notwithstanding the fact that he is in favour of Part I, and notwithstanding the fact that he would not allow economic dumping to take place, but because he believes that this 33 percent, is futile. I do not believe that it is. It is very tempting to assume that the action of depreciated currency is to be measured by the extent of the depreciation. If you have got the mark at 290 instead of 20 you cannot therefore say that 33 percent, is useless, for the advantage. that a country gets is due solely to the difference between the internal and the external value of its currency. That is nothing like that huge amount, when you take highly organised countries like Germany. It is diminishing every day, and always will tend to diminish. But there are countries, less highly organised, such as the old silver using countries, such as we have in the Middle East and the Near East of Europe, in which, owing to the fact that they are not economically highly organised, the internal and external value of the currency will not adjust themselves with the rapidity with which they will adjust themselves in Germany, and certain of those countries may become important competitors in particular lines, and there you may get dumping based on exchanges, and dumping organised by Germany.

The industries of all those regions east of Europe or in Asia will presently, to a large extent, be managed by foreign capital and foreign technicians, and their products, based on their cheap labour, will be cheaper for a series of years, because in those low grades of civilisation internal and external values do not adjust themselves as they will in. the case of Germany. There you may have competition. Therefore, I do not say immediately, you may have to bring into action the other remedies indicated in Part II of this Bill. I believe that we have equipped ourselves with what may prove to be a very valuable weapon. I believe that the 33 percent, is a very valuable weapon, and is not to be laughed away because the mark is 290 instead of 20. To say so merely shows that the whole of the economic factors have not been grasped. In those circumstances I most heartily give my humble support to this Bill, because I believe that this country has got to live on its wits in the future. Your great staple industries will be dwarfed by the magnitude of those industries in countries like America, China, and other places, and this country and Germany will fundamentally have to exist in the future, as crowded countries with larger populations than they can supply food for, on the character and skill of their people, and on the fixed and very delicate capital which they have established in the form of factories.

The hon. Member has enlivened the House, as he always does, by his wealth of knowledge and ingenuity of argument. I hope that he will not think me wanting in courtesy if I do not attempt to follow the particular lines of thought which his speech opens up. He has given in a very different way, but essentially from the same point of view, the defence of parts of this Bill with which we are familiar from the hon. Member for Chippenham (Mr. Terrell) and though he gives to the House a great versatility of exposition, as he deals with the variations that have occurred since the War and are occurring in the world, he will forgive me if I apply to him a famous line, and say of him in the realm of economics, comparing what he is now with what he was 20 years ago,

When the Financial Resolutions were before the House I said it was unfortunate that it was impossible at that stage to know what would be the scope and character of the Bill. Then when the Bill was brought in, we again found that it was in many particulars vague, and required greater elucidation. I am one of those Members of the House, of whom there are many, who are just as strong Free Traders as any hon. Members opposite, but we thought it right at the last Election to adhere to certain manifestos and certain utterances which definitely contemplated the dealing with certain industries with a view of strengthening this country in the event of another war. We also adhered to the method of taking measures to defend this country against dumping which was intentional, permanent and definitely under the cost of production. But it by no means follows that, because of those matters, that because we expected a Government Bill and were prepared to consider it from that point of view, therefore we are in any way attracted by the other part of this Bill, which is connected with the question of foreign exchanges. My Noble Friend the Member for Hastings (Lord E. Percy) is prepared to vote against the Third Reading, although he supports the other part of the Bill. My point is that any vote on the Third Reading, although you approve of the first part and disapprove of the second part, is a vote which cannot be free from ambiguity.

3.0. P.M.

In the long controversies on the Bill there have been two Divisions on which the issues were clear. There was a Division on the first part of the Bill and the first part of the second Clause. On that, like many others, I voted with the Government. There was an opportunity yesterday of voting on the definite issue whether the Clause which dealt exclusively with the problem of exchanges, should or should not be inserted in the Bill. There, again, we had an opportunity of voting against that Clause. It is to be regretted that two questions which, however much they may be allied from one point of view, are essentially different, should be so blended in this Bill that it is only possible for those who are opposed to all of them on the one hand and those who support all of them on the other, to give that fair decision which every hon. Member would desire to give. It is a great pity that the problem raised in Part I and the beginning of Part II should not have been separately dealt with and brought to an issue. The arguments for and against dealing with certain industries with a view to assuaging fears and minimising the dangers attaching to the position of this country in time of war, and the questions of dealing with deliberate and permanent dumping, are really quite distinct from the problems raised by the question of exchanges. I agree with the Noble Lord in supporting the first and opposing the second. Those who vote for the Bill on the Third Reading are, against their will, appearing to support the proposals with regard to exchanges, which have hardly any friends in this House and none at all outside. The latter part of the Bill reminds me of the maiden in one. of Wordsworth's poems:

I wish briefly to summarise one or two of the objections to the Bill taken by the Labour movement in this country. It may be suggested that we have not played a very important part in the opposition to this Bill. We opposed the Bill on the Second Reading. We have not intervened to any great extent in Committee, largely because we feel that it is no remedy at all for unemployment, and not fitted for the conditions with which it professes to deal, and all that is now necessary is to try to sum up one or two of the outstanding objections which may still be offered, before we proceed to a Division on the Third Reading. There are three parts to this Bill. There is, firstly, the part dealing with key industries; secondly, the part dealing with dumping; and thirdly, that part which relates to the collapsed exchanges. On the first part, it is common ground that only a fool in this country would do absolutely nothing at all to be prepared in certain essential commodities for any crises which might overtake Great Britain in the future. Nothing but disaster, and great sacrifice of life, could result from pursuing a policy of that kind. We are bound, however, to point out that the measure of assistance afforded by this Bill, is altogether useless for the purpose we have in mind. There is no guarantee whatever that these key industries will be safeguarded. There is absolutely nothing to make it certain that you will get the commodities which you require, and if you want to make certain of getting them, it is perfectly plain that the State itself must embark upon the provision of these articles to be used in future time of emergency, just as it embarks upon the provision of those articles which are necessary when crises actually occur. I think I express the opinion of the majority of my colleagues when I say that we are altogether opposed to the subsidising of private interests in this matter. Many of us oppose subsidy, as a general principle, because we regard it as economic disease. We will never get down to the true facts of industry in this country; we will never understand exactly what our industries can do; we will never be able to plead for the genuine co operation of Labour, while the situation is vitiated by subsidies, or while you have elements introduced, which more or less effectually prevent you from understanding whether an industry is really being carried on efficiently and economically and is a proposition to be supported by the people at large. I have not time to deal with the other undesirable elements of corruption and favouritism which a subsidy invariably introduces. So far as labour in this country is concerned, we say that if there are essential commodities, and I think there are, that are required in times of crisis, that public effort should provide them and should do so free of all subventions or subsidies by the State to private enterprise.

The second part of the Bill relates to an effort to prevent the dumping of goods into this country at prices below their value in the country of origin. In regard to that also, I think it is tolerably clear that the protection afforded is altogether negligible, but I am going to try to base our objection on rather wider grounds. We have got to distinguish between the various forms of what is called "dumping." There is one form of trade activity which is very often included under the term "dumping" which I regard as perfectly healthy enterprise. I refer to the offer of goods at comparatively low prices, during a certain time, for the purposes of trade propaganda. The goods are offered at these prices largely by way of advertisement, and with the object of drawing attention |to their quality and character, thus finding for them a way into a foreign market. It is a form of enterprise upon which, I am informed, many of our own traders and merchants embark. I see absolutely nothing to object to, and nothing to prevent, in connection with that form of enterprise on the part of any country, in the present condition of the world. From the point of view of employment we want the widest possible advertisement of all good commodities. Let that go on, and let our people try to respond, by the improvement of their methods rather than resort to any artificial device to keep these commodities out.

Is there any real danger of a widespread and general dumping in this country on the part of foreign competitors at the present time? I invite any hon. Member of this House to look round the whole economic situation in Europe at the present moment as we find it presented to us in those impartial reviews which are issued to us weekly and monthly, and ask what is the whole effort that European and other countries are trying to make, and more particularly those countries against which this Bill is supposed to be directed? They are trying to revive their export trade, and that is not an export trade in articles sold at bed rock prices below the cost of production, or anything like that, but an export trade based on the maximum price that their commodities will bring in in the other markets of the world. If that is the tendency—and it must be the tendency of those countries, because of their impoverished condition—surely it is a wrong policy on our part to do anything of this nature which is going to hinder this attempt to revive trade. Let the thing have free play, and we may be certain that the recovery will come in due course and that we shall be safeguarded along proper and healthy as against artificial lines. But before I leave that argument may I make this suggestion? On the question of dumping or on the question of the offer of articles at prices with which we cannot compete, may we ask how that is accomplished? I think it is not unfair to suggest that it is very often accomplished because the industrial organisa- tion of other and competing countries is, in many cases, better than our own. They have introduced in other countries of the world scientific methods, they have introduced great economies in the output of goods, they have adopted devices on which—because of the conservatism of our Capital on the one side, and, I am willing to admit, of our Labour on the other, in Great Britain—we have not embarked. I think that situation in Great Britain is not going to be remedied by devices of the kind included in this Bill, but it is only going to be remedied when we are put, with our backs to the wall, in the position of competing with these article and turning our attention to the whole question of the scientific management of our industry and everything else. That is going to be the proper line of recovery so far as we are concerned.

On the third part of the Bill, that dealing with collapsed exchanges, I have listened with very great attention and respect to practically every speech which has been made by the Secretary to the Overseas Trade Department on this Measure, and I confess that I was astounded when I heard him argue yesterday that, so far from the portion of the Bill dealing with these collapsed exchanges contradicting the terms of the Cunliffe Report, it was for all practical purposes an expression of the views of the Members of that very important Committee. If the hon. Gentleman has an opportunity later in the Debate, I will leave him to make good his case, but I will try to take one or two outstanding propositions of the Cunliffe Committee and ask the House whether this Bill is in keeping with what the Cunliffe Committee laid down. It is no reply to suggest that the Cunliffe Committee reported at a time when the situation was not nearly so difficult as it is today. In point of fact, if I remember rightly, the final Report of the Cunliffe Committee was dated December, 1919, when, of course, there was a problem of the exchanges, but even if that were not true, I think it is obvious that in a matter of this kind we can only find a remedy, not along the lines of chance or hasty expedient, but along the lines of bedrock principle. After all, it is bedrock principle which guides in a matter of this kind. What did the Cunliffe Committee lay down? I think the whole fundamental proposition of their Report was recovery along the lines of the freest possible intercourse of trade. Here is a Bill which, if it is to succeed at all, means inevitably restraint of trade, or a certain amount of restriction, because if it does not mean that in the case of our competitors, the Bill does not succeed, and there is no benefit at all for anyone in this country. If that restriction comes about, and the statements of the Government are correct, the Bill violates at once that bedrock principle of the Cunliffe Committee, the freest interchange of all the commodities you can turn out in maximum volume. Yet the Parliamentary Secretary yesterday said there is nothing contradictory in this Measure with what the Cunliffe Committee laid down.

What did the Cunliffe Committee say about the importance of sound currency in each country? They said that there again you must get back to a sound system of currency in each individual country, and you will find that that has a very important bearing upon the recovery of the collapsed exchanges. A very great deal of attention has been—and I think quite properly—directed to Germany in this controversy; but, at the present time, Germany is making frantic efforts to get back to something like a sound condition of national finance. They have introduced, as hon. Members know, a great variety of taxes. Many of those taxes have become unproductive, because they have been multiplied beyond all reason. Some of their devices have failed and others have succeeded; but there cannot be the slightest doubt that the best opinion in Germany is quite alive to the importance of getting back to a sound system of internal finance and currency. Everyone knows that there may be a certain temporary gain in manipulating the currency within a country; but there can be nothing but ultimate disaster. That is the plain lesson which emerges from the whole history of manipulated currency in any part of the world. This Measure has nothing to help that in the least, because, as I have tried to point out before, it interrupts the free course of trade and hinders the recovery of German exports, which is just as necessary in our interests to-day as it is in the interests of Germany itself.

Let me take a third consideration under this part of the Bill. The Cunliffe Committee laid it down that in all countries there must be, if we are to restore the collapsed exchanges, the balancing of budgets and the utmost private and public economy. Now if this Bill succeeds, the inevitable effect must be to raise prices. The Bill fails unless it does that, and, with the raising of prices, disappears the prospect, or a considerable part of the prospect, of that public and private economy which is a fundamental condition in this restoration which we are now discussing. I confess, therefore, that I find myself utterly unable to understand the contention of the Parliamentary Secretary yesterday, that there is nothing in this Bill which really violates the terms of the Cunliffe Committee's Report. In my judgment, this Measure violates the whole bed-rock argument of that report, which was a report of expert financiers and others, which did not include a single Labour representative, and was therefore strictly orthodox in its terms. For these reasons I think that Labour in this country is justified in opposing this Measure. I had hoped that under the tremendous weight of economic argument of all kinds the Government would have withdrawn it. They have not seen their way to do so. I can only say in conclusion that it will do no good in the world to anybody, and we can only hope that it will do less harm than many of us have reason to fear.

These wearying Debates and repeated arguments are drawing to a close, and I shall only intervene for ten minutes or so to give my right hon. Friend the President of the Board of Trade the opportunity of pronouncing upon the Measure his benediction—it may be his valediction, because I do not know anybody who would more regret seeing this Bill reappear than my right hon. Friend. He agrees with us that it is a poor thing, but, at any rate, he has the consolation that it is not his own! First; I wish to emphasise the point which was made by the Leader of the House to-day when he frankly admitted that there was no commercial case at the moment for the Bill. He has been challenged over and over again, as sponsor of the Bill, to point out those areas of the country and those particular industries which showed any signs of requiring the protection of this Measure. The way he got out of it was this: that the Government propose to adopt this in reply to the policy of my right hon. Friend the Member for Paisley (Mr. Asquith), and to "wait and see." But they are not doing so. While saying they are adopting the policy of my right hon. Friend to "wait and see," they are taking a leap in the dark, and in the view of the vast majority of Members who have spoken in this Debate, and of the immense body of public opinion outside, a very dangerous leap in the dark. The Bill first of all lacks the vital fundamental of all legislation; that is a case for it. I should like once more to emphasise the immense amount of public opinion ranged against the Measure, certainly unexampled in the case of any legislation of this kind. It has no kind of relation to what is known as party politics. A very brief recital without comment of the representative bodies who have circularised every Member of this House and memorialised the Government against it may not be without its uses at this moment. Manifestos have been issued by the merchants and manufacturers, the cotton trade, the woollen industry, ship-owners, merchants and tailors, and then there was that much derided manifesto of the bankers, one of the most important, clearly expressed and authoritative financial documents ever issued in the city of London. Then we had a very interesting and remarkable declaration from the scientists in regard to the key industries. This rising tide of opposition reached its peak not more than four days ago in the city of Glasgow. This great industrial centre knows more about the necessities of war and the materials which are required than any other part of the Kingdom, and among those responsible for that manifesto there were men representing all the great industries. If I were to call my hon. Friend the Member for Central Edinburgh (Mr. W. Graham) a manifesto, "I might proxy him in aid as the very latest of them. Whom does he speak for? He speaks as the representative of Labour, who would suffer more by the loss of a proper provision of the implements of war than any other class. What is the attitude of the considered mass of determined opposition to this Bill? I think I am entitled to say that, turn where you like, throughout the range of scientists, business men, high financial authorities, economists and representatives of Labour, they are all against this Measure.

Not business men.

I will give a quotation from one of the most representative men in the general range of commerce, as well as what is known as high finance. This is what Lord Inchcape says:

Many attempts have been made by former Free Traders to minimise this Measure, but let there be no mistake about it. When this Bill, after its Third Reading, leaves this House as a Money Bill, not really subject to amendment by another House, and when it comes back and, in course of time, reaches the Statute Book, we shall have made the first real break with the tradition of trade and of commerce, known as Free Trade, for 70 years. [HON. MEMBERS: "Hear, hear!"] That is right. That is what I call perfectly straight dealing.

A large number of my hon. Friends have believed that the time is long overdue when tariffs should be imposed in this country and what is known as the policy of Free Trade be given the go by. That is a position I understand, and I respect it. I know where I am. That is an honest opinion zealously fought for and defeated many a time. I agree that they are entitled to rejoice at this first sign of a full victory. However hard the truth which I am now enunciating, it is the fact. In so doing we make a breach in a practice in commerce which has been one of the greatest assets of our Empire. What did the right hon. Gentleman the Secretary of State for the Colonies (Mr. Churchill; say the other day on this matter? He spoke about our dominant, all powerful Navy. It had been viewed with jealousy by other nations in the world except one. Why? Because it was accompanied by the open port, so far as this country could make it, throughout the world. Our Empire has been built up upon that basis. We went through a war in which storms of financial adversity burst upon this country with greater fierceness and intensity than ever before in the course of its long history, and, based upon those principles of commerce, we emerged as triumphantly as any country in the world. The world today is needing peace. That will not be got by mere platform speeches or association of nations. One of the greatest humanising, uniting influences is trade—trade free from barriers and from restrictions. The nations of the world have been accustomed to look to this country for the best part of the last hundred years for a leading, shining example in this. We are breaking with our past in this respect, and I say that while the world longs for a peaceful and fructifying, international commerce, it is presented with a fiscal sword.

I agree with one of the concluding sentences in the very interesting speech of my right hon. Friend, the one in which he says that in a straight fight between Free Trade and Protection, he knew where he was. I am in entire agreement with him on that. But this is not a straight fight. It is an attempt to meet conditions and circumstances which have never before occurred in this country. The right hon. Gentleman does not know where he is, and neither do those who sit behind him know where they stand. I would like, now that the right hon. Member for Paisley (Mr. Asquith) has come in, to thank him for his kindly allusions to me at the beginning of his speech. I am sure he recognises that when one is called upon to navigate his craft as best he can, not only in hostile waters but subject to broadsides from his own friends, by way of encouragement one may be excused if navigation is sometimes difficult, and if the colour of his flag is not always altogether recognisable. I admire the dialectical phrasing of the right hon. Gentleman, and have always done so from the first moment I entered the House; but I would remind him of the saying of a man perhaps as famous in history as himself—St. Ambrose—to the effect

With regard to dumping, we have been on very difficult ground—ground which has been thoroughly explored, and on which, as I have always been the first to admit, there are many differences of opinion as to what is the better course to take. Lord Mansfield once said about the French Revolution: I think the same may be said about the economic condition of the world today. There is one great gulf, an unbridgeable gulf—between the Opposition and the Government on this matter, and that is this: They believe in free competition, and we believe in free competition; but they believe in free competition without any limit and in any circumstances, and we do not. We recognise that there is a difference between fair competition and unfair competition, and it is the unfair competition that we are trying to meet. It is a good many years since I read a text book on that most dreary and melancholy subject, political economy; but I do remember that there was somethingg in those text books called the law of diminishing returns. I remember how it was conclusively proved that, if you administered doses of manure to land, you would get increased crops up to a certain point, but that there came a point when the giving of more doses ultimately did more harm than good, and the returns began to diminish. The same is literally true of competition. Competition up to a point stimulates; up to a further point it stimulates more; but you get a peak load of competition, and then the returns begin to diminish. They diminish in the balance sheet and in every other way. Competition can be carried to a point when it ceases to stimulate and begins to retard. Our one aim in this Bill has been to provide a remedy in order that, when the country is faced with the kind of competition that kills, we may have a weapon to meet it.

The complaint has been made, and it very naturally would be made, that we have not taken sufficiently strong steps to effect the cure that we have in mind. That may be so. I think the right hon. Gentleman the Member for Paisley was perfectly right when he said that an alternative which has been discussed—the alternative of a fluctuating duty—is quite impossible in practice. I have noticed during these Debates that hon. Members opposite have taken great pleasure in putting down on the Amendment Paper passages removed wholesale from a Bill that was introduced by a predecessor of mine. But let me say to them, in all earnestness and sincerity, not for the first but for the twentieth time, that we are trying to face an entirely novel situation, and there is no doubt that in the first attempts to meet that situation proposals were made which further investigation showed to be impracticable. It has been extraordinarily difficult to find out the best way of meeting what we desire to meet, and, since that Bill was introduced and withdrawn, all its terms have been most carefully examined and studied, and such parts of it as we believed could not bear prolonged investigation have been withdrawn. We have brought forward a Bill which is now going to become law, and which we think will, so far as our ingenuity has enabled us to do so, effect the desired end. May I also remind the House that if there are cases which cannot be reached by our Bill, at any rate the fact that the British Parliament is attempting to tackle this question will serve as a Very grave warning to any countries on the Continent which may think that, by depreciating their currency, they are going to compete unfairly. It shows them that we are alive to the danger, and I think they will not be slow to draw the conclusion that the House of Commons, having gone thus far on the way to checkmate their devices, will not be slow to go further if later on it should be found that the measures they have taken are unsuccessful.

My hon. Friend the Member for Chippenham (Mr. Terrell) complained that I had whittled down the Bill in Committee I have not whittled down the Bill at all. It is quite true that I was unable to accept a suggestion he made as to the imposition of a duty. I believed his suggestion to be impracticable. I was not able to convince him, but when we look at the Bill as it was introduced and as it is leaving the House, I do not think any of us can say that it has been whittled down. The most important change in the Bill is the Amendment which the Committee put in deciding that there should be a right of presentation of their case to the Committee by the user of the dumped material. I do not think that anyone, whatever his fiscal or political views may be, on reflection can possibly object to that, because, after all, the object of this Bill is to prevent, in this country, unfair competition which may lead to serious unemployment, and if you are to consider that question of serious unemployment it seems to me essential to see, as far as you can accu rately gauge it, what the amount of the unemployment is going to be. I found it quite impossible, and the Committee agreed with me when the matter was debated, to go further with this matter. No power on earth could decide the aggregate or ultimate unemployment which might be caused, but you can get quite near enough by allowing the user to present his case, and I believe that Amendment we put in will be of great value and we shall get a vast amount of most interesting and accurate knowledge of trade conditions by the evidence that will be given before these committees.

I should like to say one word about the attitude of one or two friends of mine who feel so strongly on the portion of the Bill referring to exchange dumping that they will be unable to support it in the Lobby. After all the chief positive gain of this Bill is the protection of the key industries, a matter of very vital importance, and I would ask anyone who is dissatisfied with this or that part of the Bill, while agreeing with our view on key industries, to consider this point. Supposing his vote were the deciding vote as to whether the Bill passed or not, would he be prepared to sacrifice this protection for the key industries or would he think the third portion of the Bill was of such vital importance to the country that he would sacrifice the key industries? I cannot imagine anyone who takes the view which I have attempted to describe in connection with key industries voting against this Bill, because there may be some part in the later portions of the Bill with which he is not in full sympathy.

I said on the introduction of the Bill that I should resist any Amendments which would directly or indirectly prevent the Bill from working or weaken its power, but that I would consider any Amendments which would improve its working or make it more efficacious or improve it in any way. I have done my best to adhere to the line I then put forward, and I am convinced that the alterations made in Committee have all been designed to improve the Measure. I do not think we have put in any Amendments which tend to weaken the Bill for the purpose we have in view. This Bill, in spite of many quotations which have been read today, has been desired in various parts of the country by large bodies of business men. One hon. Friend who was not able to catch your eye today, Mr. Speaker, asked me to state that the Chambers of Commerce have passed this Resolution:

What Chamber of Commerce is that?

The Associated Chambers of Commerce.

Not the Chamber of Agriculture.

I am well aware that in all these bodies there is difference of opinion, but I would remind the House that the progress of these Debates has shown one thing very clearly above any other, and that is that amongst those who oppose the Bill, and sometimes amongst those who support the Bill, there is some confusion as to what the Bill really does or does not do. A good deal of the opposition to the Bill has come from people who have no knowledge of what is really in it. My hon. Friend the Member for Chippenham has asked me as to the intentions of the Government in regard to the administration of the Bill. It is the intention of the Government to administer this Bill. Inquiries will be held in due course, when a demand is expressed for these inquiries to be held, and when I am able to publish the names of the Committee that will hold these investigations, I am quite confident the House will recognise that I have been successful in getting together a Committee of wide experience, wide knowledge, and, I think they will agree with me, of a considerable measure of impartiality.

I will say only one thing in conclusion. It is this. There is this difference between the Government and the Opposition, that we are trying to face what we believe to be a very serious problem, while the Opposition, through these Debates, have either denied the existence of a problem or have held the view that there was nothing to be done in the presence of the problem. [HON. MEMBERS: "No!"] I would remind them of an observation which was made in a very well-known work which probably most of them have read, called, "The Grammar of Assent."

The right hon. Gentleman has appealed to those supporters of the Government who are unable to approve of those portions of the Bill dealing with exchanges. He represents that as a very small detail for which Members should not jeopardise the Bill as a whole. Is it a small detail? The other parts of the Bill, relating to key industries and dumping are small details in comparison with the commerce of the country as a whole, and apply only to one or two special industries, but, so far as the exchanges are concerned, they

cover the whole trade and commerce of a country which depends for its life on international commerce. There is no urgency for this part of the Bill. [HON. MEMBEES: "No!"] Can anyone say that if this Bill is not passed we are going to be defeated in a new war? There is no special urgency, and the Government can afford to take the verdict of its supporters on this matter, and if its supporters are against it, bring in a Bill relating to key industries and dumping, but not relating to the rates of exchange. It is not fair to supporters of the Government, who, like myself, are pledged in relation to key industries and dumping, to say, "We will not allow you to redeem your pledge unless you vote for something else to which you are opposed." I believe that the proposals of this Bill will be hurtful to the trade and industry of this country. I believe that they will have to be repealed. I cannot bring myself to vote for this Bill. I shall vote against it.

Question put, "That the word 'now' stand part of the Question."

The House divided: Ayes, 176; Noes, 54.

Division No. 347.]	AYES.	[4.0 p.m.
Adair, Rear-Admiral Thomas B. S.	Craik, Rt. Hon. Sir Henry	Hilder, Lieut.-Colonel Frank
Allen, Lieut.-Col. Sir William James	Curzon, Captain Viscount	Hills, Major John Waller
Amery, Leopold C. M. S.	Dalziel, Sir D.(Lambeth, Brixton)	Hoare, Lieut-Colonel Sir S. J. G.
Archer-Shee, Lieut.-Colonel Martin	Davidson, J. C. C. (Hemel Hempstead)	Hohler, Gerald Fitzroy
Armstrong, Henry Bruce	Davies, Thomas (Cirencester)	Hood, Joseph
Astbury, Lieut.-Com. Frederick W	Davison, Sir W. H. (Kensington, S.)	Hopkins, John W. W.
Atkey, A. R.	Denniss, Edmund R. B. (Oldham)	Hunter, General Sir A. (Lancaster)
Bagley, Captain E. Ashton	Dewhurst, Lieut.-Commander Harry	Jameson, John Gordon
Balrd, Sir John Lawrence	Dockrell, Sir Maurice	Jesson, C.
Baldwin, Rt. Hon. Stanley	Doyle, N. Grattan	Jodrell, Neville Paul
Balfour, George (Hampstead)	Du Pre, Colonel William Baring	Kellaway, Rt. Hon. Fredk. George
Barlow, Sir Montague	Eyres-Monsell, Com. Bolton M.	Kelley, Major Fred (Rotherham)
Barnett, Major Richard W.	Falle, Major Sir Bertram Godfray	Kerr-Smiley, Major Peter Kerr
Barnston, Major Harry	Fildes, Henry	King, Captain Henry Douglas
Beauchamp, Sir Edward	Fisher, Rt. Hon. Herbert A. L.	Lewis, Rt. Hon. J. H. (Univ., Wales)
Bell, Lieut.-Col. W. C H. (Devizes)	Flannery, Sir James Fortescue	Lindsay, William Arthur
Benn, Sir A. S. (Plymouth, Drake)	Ford, Patrick Johnston	Lloyd-Greame, Sir P.
Betterton, Henry B.	Forrest, Walter	Locker-Lampson, Com. O. (H'tingd'n)
Bigland, Alfred	Foxcroft, Captain Charles Talbot	Lowe, Sir Francis William
Blades, Sir George Rowland	Frece, Sir Walter de	Lowther Major C (Cumberland, N)
Blair, Sir Reginald	Fremantle, Lieut.-Colonel Francis E.	M'Connell, Thomas Edward
Borwick, Major G.O.	Gardner, Ernest	McCurdy, Rt. Hon. Charles A.
Boscawen, Rt. Hon. Sir A. Griffith.	Gibbs, Colonel George Abraham	M'Donald Dr. Bouverle F. P.
Bottomley, Horatio W.	Gilmour, Lieut.-Colonel Sir John	Mackinder, sir H. J. (Camiachie)
Bowles, Colonel H. F.	Goff, Sir R. Park	McLaren, Hon. H. D.(Leicester)
Bowyer, Captain G. W. E.	Gould, James C.	Macnamara, Rt. Hon. Dr. T. J.
Boyd-Carpenter, Major A.	Grant, James Augustus	Macpherson, Rt. Hon. James I.
Breese, Major Charles E.	Gray, Major Ernest (Accrington)	Magnus, Sir Philip
Brittain, Sir Harry	Greenwood, Colonel Sir Hamar	Mallaby-Deeley, Harry
Brown, T. W. (Down, North)	Greenwood, William (Stockport)	Malone, Major P. B. (Tottenham, S.)
Bruton, Sir James	Gregory, Holman	Manville, Edward
Buchanan, Lieut.-Colonel A. L. H.	Greig, Colonel Sir James William	Mitchell, Sir William Lane
Buckley, Lieut.-Colonel A.	Guinness, Lieut.-Col. Hon. W. E.	Moles, Thomas
Burgoyne, Lt-Col. Alan Hughes	Hacking, Captain Douglas H.	Moison, Major John Eisdale
Burn, Col. C. R. (Devon, Torquay)	Hall, Lieut.-Col. Sir F. (Dulwich)	Mond, Rt. Hon. Sir Alfred Moritz
Burn, T. H. (Belfast, St. Anne's)	Hall, Rr-Adml Sir W.(Llv'p'l,W.D'by)	Moore, Major-General Sir Newton J.
Chamberlain, Rt. Hn. J. A.(Blrm., W.)	Hamilton, Major C. G. C	Moore, Major-General Sir Newton J.
Chamberlain, N. (Birm., Ladywood)	Hanna, George Boyle	Morden, Col. W. Grant
Churchman, Sir Arthur	Harmon, Patrick Joseph Henry	Moreing, Captain Algernon H.
Clay, Lieut.-Colonel H. H. Spender	Harmsworth, C. B. (Bedford, Luton)	Morison, Rt. Hon. Thomas Brash
Clough, Sir Robert	Henderson, Major V. L. (Tradeston)	Munro, Rt. Hon. Robert
Cockerill, Brigadier-General G. K.	Herbert, Dennis (Hertford, Watford)	Murchison, C. K.

Murray, Hon. Gideon (St. Rollox)	Roberts, Rt. Hon. G. H. (Norwich)	Thomas-Stanford, Charles
Neal, Arthur	Roberts, Samuel (Hereford, Hereford)	Thomson, Sir W. Mitchell- (Maryhlll)
Newman, Colonel J. R. P. (Finchley)	Roundell, Colonel R. F.	Thorpe, Captain John Henry
Nicholson, William G. (Petersfield)	Samuel, A. M. (Surrey, Farnham)	Tryon, Major George Clement
Norris, Colonel Sir Henry G.	Samuel, Samuel (W'dsworth, Putney)	Walters, Rt. Hon. Sir John Tudor
Ormsby-Gore, Hon. William	Sassoon, Sir Philip Albert Gustave D.	Warren, Sir Alfred H.
Parker, James	Section, J. A.	Whitla, Sir William
Pearce, Sir William	Shortt, Rt. Hon. E. (N'castle-on-T.)	Wild, Sir Ernest Edward
Pease, Rt. Hon. Herbert Pike	Simm, M. T.	Willoughby, Lieut.-Col. Hon. Claud
Peel, Col. Hon. S. (Uxbridge, Mddx.)	Smithers, Sir Alfred W.	Wills, Lt.-Col. Sir Gilbert Alan H.
Pennefather, De Fonblanque	Sprot, Colonel Sir Alexander	Wise, Frederick
Pratt, John William	Stanier, Captain Sir Beville	Wood, Sir H. K. (Woolwich, West)
Prescott, Major W. H.	Stanley, Major Hon. G. (Preston)	Woolcock, William James U.
Purchase, H. G.	Sturrock, J. Leng	Worthington-Evans, Rt. Hon. Sir L.
Raeburn, Sir William H.	Sugden, W. H.	Young, E. H. (Norwich)
Rawlinson, John Frederick Peel	Sutherland, Sir William
Rees, Sir J. D. (Nottingham, East)	Taylor, J.	TELLERS FOR THE AYES.—
Richardson, Alexander (Gravesend)	Terrell, George (Wilts, Chippenham)	Colonel Leslie Wilson and Mr. Dudley Ward.
NOES.
Ainsworth, Captain Charles	Johnstone, Joseph	Raffan, Peter Wilson
Asquith, Rt. Hon. Herbert Henry	Jones, Sir Evan (Pembroke)	Rose, Frank H.
Barnes, Major H. (Newcastle, E.)	Kennedy, Thomas	Royce, William Stapleton
Bowerman, Rt. Hon. Charles W.	Kenworthy, Lieut.-Commander J. M.	Scott, A. M. (Glasgow, Bridgeton)
Carter, w. (Nottingham, Mansfield)	Kenyon, Barnet	Shaw, Hon. Alex. (Kllmarnock)
Clynes, Rt. Hon. John R.	Kiley, James Daniel	Thomas, Rt. Hon. James H. (Derby)
Collins, Sir Godfrey (Greenock)	Lawson, John James	Thomas, Brig.-Gen. Sir O. (Anglesey)
Cowan, D. M.(Scottish Universities)	Lister, Sir R. Ashton	Thomson, T. (Middlesbrough, West)
Finney, Samuel	Lyle-Samuel, Alexander	Wallace, J.
Glanville, Harold James	Macdonald, Rt. Hon. John Murray	Wedgwood, Colonel Josiah C.
Graham, R. (Nelson and Colne)	Maclean, Rt. Hon. Sir D. (Midlothian)	White, Charles F. (Derby, Western)
Graham, W. (Edinburgh, Central)	MacVeagh, Jeremiah	Wignall, James
Griffiths, T. (Monmouth, Pontypool)	Mosley, Oswald	Williams, Aneurin (Durham, Consett)
Grundy, T. W.	Murray, Hon. A. C. (Aberdeen)	Williams, Col. P. (Middlesbrough, E)
Hayward, Evan	Murray, Dr. D. (Inverness & Ross)	Wilson, W. Tyson (Westhoughton)
Hirst, G. H.	Myers, Thomas	Wood, Major M. M. (Aberdeen, C.)
Hogge, James Myles	Newbould, Alfred Ernest
Holmes, J. Stanley	Norman, Major Rt. Hon. Sir Henry	TELLERS FOR THE NOES.—
Irving, Dan	Percy, Lord Eustace (Hastings)	Mr. G. Thorne and Mr. Arthur Henderson.

Bill read the Third time, and passed.

The remaining Orders were read, and postponed.

Whereupon Mr. SPEAKER adjourned the House, without Question put, pursuant to Standing Order No. 3, till Monday next (15th August), pursuant to the Resolution of the House of this day.

Adjourned at Eight Minutes after Four o'clock.

Hansard

Volume 146: debated on Friday 12 August 1921

House of Commons

Safeguarding of Industries Bill

Private Legislation Procedure (Scotland) Act, 1899

Adjournment

Message from the Lords

Orders of the Day

Safeguarding of Industries Bill