162 REPORT OF THE No. 3 



old establislied channels 6i commerce and industry, yielding, gradually 

 but surely, as tlie innovation succeeds in justifying itself by the test of 

 practical experience. Sooner or later, the timber resources of Canada 

 would have found a market in Britain under any circumstances, but there 

 is no doubt that the financial policy, which, by imposing higher duties on 

 the Baltic timber, gave the colonial product such great advantage in cheap- 

 • ness to the consumers, greatly hastened the period of its introduction for 

 building purposes. Once established firmly in popular appreciation it main- 

 tained its ground in spite of the changes in fiscal policy, which deprived it 

 of these factitious advantages. 



Duty Reduced. 



In 1842 the duty was reduced to 26s. per load on foreign, and Is. on 

 colonial timber, ,'witho.ut resull^ing in any permanent diminution in the 

 volume of importations from British North America. The great Free Trade 

 movement which resulted in the repeal of the corn laws in 1846 witnessed 

 a further reduction in the foreign timber duties and the total abrogation of 

 the hardly more than nominal impost on the Canadian product. 



Gladstone. 



In a despatch sent by the Right Hon. W. E. Gladstone, then Colonial 

 Secretary, under date of March 3rd, 1846, to Earl Cathcart, Governor of 

 Canada, announcing the change of policy, the following references to the 

 timber trade of the colonies with Britain occur: — "I have much sntisfac- 

 tion in drawing your Lordship's attention to the fact, that the colonial tim- 

 ber trade prospers under the operation of these chaneres in the laws which 

 were enacted in 1842, and which had taken full effect before the end of 



1843 The increased facilities of internal transit in this 



country, independently of the very great temporary demand connected with 

 the construction of the railways, that are to effect this great improvement, 

 promise a considerable and permanent extension of the market for foreign 

 woods, an extension likelv to be accelerated, unless it be as to Scotland, by 

 the proe-ressive diminution of the home growth of timber throujyh the 

 United "Kinsrdom. 



''The description of wood which is supplied by the British North 

 American colonies, the yellow pine, is not chiefly to be regarded as com- 

 peting with the wood of the Baltic, but rather as available for different 

 though concurrent uses. For example, the increase of Baltic timber, tend- 

 ing to encourage the construction of new buildings by supplying the best 

 materials for particular portions of them, has an effect not in limitinq- but 

 in extending the demand for Canadian timber, as furnishing the cheanesfc 

 and most convenient material for other portions, namely, the inward 

 fittings of the very same fabrics. 



Duty to Equalize Freights. 



**Her Majesty's Government are -not indeed prepared to assert that- the 

 question of the relation between the duty on foreisrn timber and the colonial 

 wood trade oufirht to be adjusted with reference to this consideration alone, 

 and you will perceive that they propose to retain a dntv of 15s. per load 

 upon foreign timber, which I apprehend may be considered as. upon +he 

 average, nearly coverinsr the difference between freic-hts from tho Baltic 

 «nd those from British North America to the United Kingdom. Not only 



