to an improvement in freights, or to increased commercial activity. It is by a continual reduction in the working expenses that the position of shipowners has been improved. The price of coal is a principal factor in the cost of running steamships, and the fluctuations of recent years are tabulated by the 'Statist' as follows:

During 1878 the prices for building ships have fallen to the lowest point which they have ever reached.

of com

the allevi

ating fea

ture.

Reductions in the price of commodities are equally Cheapness valuable whether as a relief to working people in their modities hour of necessity, or as a means of restoring to our trade its former prosperity. With cheaper raw materials, a losing may be converted into a profitable trade. By offering goods at lower prices we may increase the demand. Cheap bread and cheap raw materials are the best alleviations of the bad times through which we are now passing, and they present, as Mr. Shaw Lefevre remarks, the best guarantee of ultimate recovery.

supply,

The fall in prices, of which so many illustrations Deficient have been given in the preceding pages, has been gold traced by some of our highest statistical authorities, including Professor Jevons and Mr. Giffen, to the insufficiency in the current supply of gold. With a view to the elucidation of the subject, Mr. Giffen has compiled the following table:

D

Estimated Production of Gold in the years 1852-75, in Quinquennial Periods, with the several Averages for each Period.

While the supply has been dwindling away, the demand for gold has enormously increased. The growth of the population in the gold-using countries cannot be set down at less than 50 per cent.; and the development of mechanical invention has prodigiously increased the supply of goods and the movement in trade. Mr. Giffen infers that, if a supply of six millions sterling was sufficient to maintain the equilibrium of prices before 1848, the natural increment in the population would make the present usual requirements about nine millions. Fifty per cent. must be added for the greater wealth per head, making the total additional requirements not less than thirteen and a half millions. Prices have been more seriously affected by the deficiency in the supply of gold, in consequence of the recent demonetisation of silver in France and Germany.

35

CHAPTER III.

THE COTTON TRADE.

We shall now proceed to examine the present condition and recent history of two great branches of the national industry, which have suffered most seriously from the prolonged depression of trade.

cotton

The latest returns of the cotton trade, while exhibit- Exports of ing a large reduction in value, do not show a corre- goods. sponding decrease in quantities. This is clearly proved in a table borrowed from the Economist:'

Quantity and Value of Yarns and Manufactures exported during each of the past Eleven Years.-(In millions and tenths.)

State of

the trade,

as tested by the Oldham mill dividends,

When, however, the allegations of foreign competition are renewed again and again, the public are naturally disturbed by apprehensions as to the future of British industry. I propose, therefore, to recount, as briefly as I can, the recent history of the textile industries and the iron trade.

opera

Not less than 4,000,000 persons, according to the computation of Mr. Bevan, and a capital of 100,000,000l. are engaged in these trades. The wages of the tives are falling, and the returns upon the capital invested are insufficient. It is important, therefore, to know to what extent British industry has been affected by foreign competition, and by other causes more immediately within our own control. The balancesheets of the joint-stock cotton mills may be accepted as examples of the results obtained in the majority of the private concerns in the trade.

·

A circular published in 1878 by Messrs. Ellison & Co. gives a table of the dividends declared in Oldham in the last quarters of 1876 and 1877 respectively. It will be observed,' they say, that out of forty companies, only four paid a dividend in the third and fourth quarters of 1877. The average return for the forty mills was 33 per cent. in 1877 against 11 per cent. in 1876. Not only are the average dividends reduced for the whole of the mills; in many cases no dividends whatever were declared, and severe losses were sustained during the period in question. As the Oldham mills are understood, for the most part at least, to possess the latest improvements in machinery, and to be worked upon the most economical principles, the list

may be taken as fairly representing the entire cotton industry of the country.'

relative

Another test may be applied in order to ascertain and by the the state of the cotton trade. The variations in the prices of price of cotton may be compared with the price of manufacyarns and cloths.

The following table, showing the relative prices of raw cotton and cotton goods, was published in the 'Economist:'

An Estimate of the Value of the Production of Cotton Manufactures in Great Britain, with the Cost of Cotton consumed and the Balance remaining for Wages, all other Expenses, Interest of Capital, and Profits for each of the past Twelve Years.

raw and

tured

material.

£

In a later issue, the Economist' points out that cotton goods have actually increased in quantity about 10 per cent., though realising some ten millions less. The diminution in the receipts for cotton exports is nearly equally due to the lower value of the cotton itself and the diminished wages and profits accruing from its manufacture.

In October 1878, the Statist' gave a series of comparative tables of the quotations for cotton yarn