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in some quarters that the development of submarine warfare has completely altered the character of the war problems with which we have to deal. On the contrary the losses inflicted by the enemy on our shipping during the present war are proportionately less than the losses we suffered during the Napoleonic Wars. This does not mean that the submarine peril can be ignored : it only means that we should do wisely to take a level view of it.
In any case the submarine trouble has little direct connexion, if any at all, with the problem of colonial preferences. For if it were true that a European enemy could by the use of submarines prevent supplies from reaching these islands, that consideration would affect supplies from British possessions at least as much as supplies from foreign countries. It would indeed affect them more; for, with the exception of Canada, most of our imperial sources of food supply are farther away from the British Isles than many important foreign sources of supply. Ships bringing food to Great Britain from India or Australia run greater risks of being sunk by submarines than ships coming from the United States or South America, both because of the greater sea distance and because of the character of the sea route they generally follow.
This consideration is in no way dependent on the facts of the present war. Indeed, if we were at war with a Mediterranean power our shortest sea route to India and Australia would be in far greater peril than it is at present. To take another hypothesis, let us suppose that fifty years hence England may be at war with the United States and at peace with her present enemies, and also with her present European Allies. In that event it would clearly be safer, so far as submarines are concerned, to import food from the foreign countries at our doors rather than from any of the oversea portions of the Empire. The submarine peril is, in fact--so far as the particular question of imperial preference is concerned-a false scent. It leads nowhere, except to the proposition that the British Isles must entirely give up their oversea trade, both with foreign countries and with British possessions, lest in some future war some still more terrible submarine should make all sea trade impossible.
The really relevant consideration is of quite a different character. It is two-fold. In the first place there is a danger that during peace a potential enemy might obtain a commercial
grip upon some industries essential to our national life, and in the second place there is a danger that during war neutral countries might be terrorised or persuaded by our enemies to the extent of refusing to supply us with necessaries previously purchased from them. Both these dangers have been illustrated during the present war.
The first was dealt with in an article in this REVIEW in July 1916, called 'A Commercial League of Defence.' It was there argued that as Germany had clearly shown that she 'regards
commercial enterprise as a form of preparation for military action,' we must take that fact into account in framing our commercial policy for the future. It was, however, pointed out that, happily, Germany had not succeeded in doing us so much harm by her belligerent commercial methods as she probably hoped, and as many Englishmen certainly feared. In practice we were able to adapt our industries very rapidly to the new conditions created by the war, and to make for ourselves things previously imported from Germany, before we had suffered any grave inconvenience from the disappearance of the German supply. But there is, of course, a danger that we might on some future occasion be less alert or less fortunate, and therefore prudence demands that we should take steps to prevent the control of vital industries passing into the hands of potential enemies.
The question of the danger arising from the possible action of neutrals has also to be considered. It has been specially illustrated during the present war by the position of Holland and Denmark. The Dutch and the Danes, for very good reasons, are more afraid of Germany than of Great Britain, and though they have doubtless striven to hold the balance fairly there is some ground to suspect that the course of their trade has been deflected to our injury by their dread of a German invasion. Again, in the earlier days of the war, we had to fear a danger on a greater scale from America. The friends of Germany in the United States persistently argued that if America wished to be neutral in fact as well as in theory she must cease to supply food and munitions of war to the Entente Powers. The argument was that, as the command of the sea by Great Britain prevented Germany from obtaining contraband of war from America, the only way to equalise matters was for America to refuse to supply either party.
superficial plausibility of this argument did at one time undoubtedly affect American opinion. Happily, the commonsense view prevailed that it is not the business of a neutral nation to make good the inequalities of two belligerents. Nevertheless, it is conceivable that if the pro-German and anti-English currents of feeling in the United States had been somewhat stronger a different view might have been taken, and the American people might have refused to supply the commodities we required because they could not render a similar service to Germany. There is certainly a possibility that such a situation might arise in the future.
In both these directions there is a danger that ought to be carefully weighed. Its existence furnishes a valid argument for examining afresh the policy of the open door which has been the basis of our national and of our colonial system for threequarters of a century. Under that policy the wealth of these islands has grown at a rate unparalleled in our history. Our population, our shipping, our manufacturing industries, our international banking business, have all increased enormously. At the same time the comparatively small Empire that remained to us after the revolt of the American colonies has, during the era of the open door, grown without ceasing, till now the British Empire, taken as a whole, possesses a greater population, a more extended commerce, and more realised wealth than any other national unit within the world. These facts should make us cautious in adopting any fundamental change of system; they do not prove that we ought to refuse to consider specific changes which may be suggested by the revelation of new dangers.
Nor are we the only nation to whom this problem is presented; our Allies, although their commercial policy differs very widely from ours, are equally conscious of similar dangers, and it was with a view to considering the possibilities of combined action that a very important conference of the Entente Powers met in Paris in May last. It recommended various steps which the Allies should take conjointly for the defence of their common interests. In the following July the then government of the United Kingdom appointed a committee to consider the commercial and industrial policy to be adopted after the war, with special reference to the conclusions reached at the Economic Conference of the Allies.' The Committee were further instructed to have special regard to the following questions :
(a) What industries are essential to the future safety of the nation ? And what steps should be taken to maintain and establish them ?
(6) What steps should be taken to recover home and foreign trade lost during the war and to secure new markets ?
(c) To what extent and by what means the resources of the Empire should and can be developed ?
(d) To what extent and by what means the sources of supply within the Empire can be prevented from falling under foreign control ?' ('The Times,' Feb. 21, 1917.) Lord Balfour of Burleigh was appointed chairman of the Committee, and among his colleagues were such well-known men as Mr. W. A. S. Hewins, Lord Faringdon, and Mr. Henry Birchenough - to pick out only a few names from a distinguished list.
After sitting for six months, this Committee suddenly addressed to the present Prime Minister a letter enclosing resolutions in favour of the principle of preferential tariffs. No attempt was made to show how this principle would affect the problems which the Committee had been appointed to consider. With great frankness the Committee explained that they proposed to deal with their appointed task at a later date. The reasons they gave for issuing a sudden pronouncement on an extraordinarily complex and difficult problem were, the imminence of an Imperial Conference, and their own belief that it was 'necessary for the sake of the unity of the Empire that a serious attempt should now be made to meet the declared wishes of the Dominions and Colonies.' To emphasise this argument the Committee recited the facts that both in 1902 and in 1907 'the Prime Ministers of the 'self-governing Colonies unanimously urged the expediency of granting in the United Kingdom preferential treatment
to the products and manufactures of the Colonies, either by 'exemption from or reduction of duties then existing or there'after to be imposed. The Committee went on to add :
'We think that, regard being had in particular to the sacrifices made and the services rendered by our fellow subjects overseas for a common purpose during the present war, the time has now arrived at which this request should be granted to the fullest extent which is now or may hereafter become practicable.'
No other reason was given, and the Committee carefully announced that they proposed to consider later the practical difficulties involved' in carrying out the policy which they recommended the Government of the United Kingdom to adopt at once. In plain words colonial preference was to be set up, not on its merits, but because the Dominion Premiers had asked for it, and because the Committee thought that the colonies ought to be paid for their loyalty. Whether this pronouncement was spontaneous on the part of a committee which had been appointed for another purpose, or whether it was produced on a hint from higher quarters, there is no public means of knowing. Presumably, in neither case was the pronouncement intended as an insult to our fellow citizens whose homes are across the seas. But those who know anything of the spirit which brought thousands of gallant men from Canada, Australia, and New Zealand to die in Flanders or Gallipoli will regret that a responsible Committee should have so reflected upon the memory of these brave men.
Very different has been the action of another body appointed to deal with similar problems. The Dominions Royal Commission was appointed in April 1912, in consequence of a resolution passed by the Imperial Conference of 1911. The business of the Commission was to inquire into and report upon the following subjects :
• (a) The natural resources of the five self-governing Dominions and the best means of developing these resources.
(6) The trade of these parts of the Empire with the United Kingdom, each other, and the rest of the world.
(c) Their requirements, and those of the United Kingdom, in the matter of food and raw materials, together with the available sources of supply.'
The Commission in its final shape was composed as follows: Lord D'Abernon, chairman, Sir Rider Haggard (Norfolk), Mr. T. Garnett (Lancashire), Sir W. Lorimer (Scotland), Mr. Tatlow (Ireland), Sir Alfred Bateman (formerly of the Board of Trade), Sir G. E. Foster (Canada), Mr. J. R. Sinclair (New Zealand), Sir J. W. S. Langerman (South Africa), and Sir E. R. Bowring (Newfoundland). During its five years' existence this Commission has travelled round the self
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