TKANSACTIONS OF SECTION F. 671 



MOXDAY, AUGUST 30. 

 The President delivered an Address. 



The following Papers were read : — 



1. Protection in the United States and its Lessons. By Geoege 

 Baden-Powell, M.A., F.B.A.8., F.8.S. 



When the question of Free Trade is broached, the rejoinder is, ' Why, then, do 

 the United States flourish so with their Protection ? ' If we examine the facts of 

 the case, we shall find that in the United States prosperity exists in spite of and 

 not because of Protection, and that Protection has hampered and not assisted the 

 development of native manufactures in the United States. 



Firstli/. Protection cannot seriously afiect the prosperity of the United States, 

 because the import trade is comparatively insignificant. 



Also. The United States is an undeveloped country. It not only feeds itself, but 

 half its exports are food. This is a source of wealth unaffected by Protection. 



[This food-producing will only affect the English market in a gradually decreas- 

 ing ratio : as population increases in the States it rapidly raises the cost of growing 

 food ; it rapidly raises the cost of carriage. The margin of profit is small now, and 

 will eventually be destroyed by this inevitable growth of population. The British 

 farmer by the end of the century will have little American competition to face.] 



Also. Absolute Free Trade exists within the United States. And, considering 

 that this Free Trade covers an area the size of Europe, and at least equal in fer- 

 tility and resources, we see it is the one great factor in the prosperity of the 

 United States, and one that successfullj^ resists the e'sil effects of a high tariff" 

 towards outsiders. 



Secondly. Protection has hampered and not developed manufactures. 



(1) It is true that the amount of virgin soil perpetually being brought under cul- 

 tivation relieves manufactures in bad times ; but even so, distress in the ' artificial ' 

 manufacturing districts of the States is always greater than in the ' natural ' districts 

 in England. 



But this wealth of virgin resources not only supplies manufacturers with abun- 

 dant raw material, but also with a class of wealthy local consumers. This wealth 

 at once nourishes the body of manufacturers and conceals its diseased condition. 



(2) We find that the protected manufacturers fail to monopolise the home 

 marhet. The high prices, consequent on Protection, enable foreign manufacturers 

 to pay the high duties, and provide them with means to pierce the barrier set up. 

 The increase of population would naturallj' start manufactures, but is prevented 

 from so doing by this high tarifiF, which invites and enables foreigners to supply the 

 local market. 



(.3) American manufacturers do not export. What little they sell in foreign 

 markets is mainly what results from bad times in America. Stocks on hand that 

 then find no sale in the States are supplemented by stocks created by manufacturers 

 because of the abnormally low prices of labour in depressed circumstances. 



(4) Then, too, manufacturers are hampered on all sides by the high prices of all 

 they use or consume. They cannot produce cheaply, and so fail to compete in 

 foreign markets. Protection stifles their powers of competing. It hampers and 

 does not foster native manufacturing enterprise. 



Thirdly. It may be asked. Why do the people of the United States, with all 

 their acknowledged intelligence and cleverness, put up with such things ? 



1. One reason is, they are but little aifected directly by Protection. They are 

 occupied almost exclusively with opening up vast virgin resources. The wealth 

 that results is so great that they pay little heed to the loss imposed on tbem by Pro- 

 tection. 



2. Another plea, worked by the few that profit by Protection, acts as a great 



