INTRODUCTION.

THE following papers are the outcome of an engagement, made last winter, to deliver lectures at Edinburgh and Hull on the condition and prospects of trade. The most laborious investigator cannot fully exhaust a subject so difficult and important. Pursuing the inquiry amid many interruptions, but I hope in a spirit of unswerving fairness, I have been led step by step from the main question to various collateral topics, and from one source of information to another. The studies in which I have thus been engaged have been a formidable addition to other more urgent and indeed unavoidable duties. I am obliged to desist from the further prosecution of my task, and I present the result of my inquiry to the considerate examination of the com mercial world, with all the imperfections of which I am so deeply conscious.

Not now for the first time I have had under consideration the expediency of retiring from Parliament, with the view of devoting an undivided attention to the elucidation of industrial problems, and the improvement of the relations between capital and labour. The

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reward of labour, and the profit upon investments, are questions which cannot be settled by legislation. a member of Parliament, I have felt it my duty to devote myself to the maritime interests of the country; and I find it impossible to follow up simultaneously the twofold and widely divergent specialities of political economy and naval administration. My experience is doubtless shared by the majority of members of the House of Commons. Many subjects are brought under our review, and we are all more or less overtaken and outstripped by the rapid march of events.

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While the multitude of idlers is probably greater than in any former generation, those who have any work to do live at a too high pressure in this age inventions for abridging processes, shortening distances, and economising time. If our literature is condensed into articles in periodicals, the number of topics to which our attention is invited is proportionately multiplied. The overtasked toiler in the nineteenth century look back with envy to the repose and the contemplative existence of the patriarchal time.

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Man's life was spacious in the early world:

It paused like some slow ship with sail unfurled,
Waiting in seas by scarce a wavelet curled:

Beheld the slow star-paces of the skies,

And grew from strength to strength through centuries.'

As in the domain of politics, and as with investigations in the sphere of the physical sciences, so it is with politico-economic questions; we are encumbered by the rapid accumulation of facts. It becomes more 1 George Eliot. The Lerend of Jubal.'

and more difficult to evolve and establish general principles, in proportion as we extend our knowledge of details. Mr. Buckle has truly remarked that the magnificent generalisations of Newton and Harvey could never have been completed in an age absorbed in one unvarying round of experiments and observations. We are in that predicament that our facts have outstripped our knowledge, and are now encumbering its march. In vain do we demand that they should be generalised and reduced into order. We hear constantly of what nature is doing, but we rarely hear of what man is thinking.'

Readers of the following papers will not fail to discover for themselves my heavy obligations to the press. My task has been mainly one of selection and compilation. I make no pretension to original discovery, and consider it the chief merit of this volume. that it is a record and a registry, not a work of fancy, imagination, and theory.

I was originally moved to address the public on the industrial question by the exaggerated charges against the British workman, which were being made when I entered Parliament in 1868. Then, as now, the industrial energies of the country seemed to be enervated and exhausted, and a general disposition was manifested to impute the blame of our financial misfortunes to the working people. My father, after an unequalled personal experience, had discovered that the cost of work, as distinguished from the daily wage

of the labourer, was approximately the same in all countries. With his assistance, I was enabled to show that too much significance had been attached to the purchase of a few engines from Creusot for the Great Eastern Railway, and the importation of a few tons of rails from Belgium. I am deeply sensible of the diminished value of the present investigation. Without my father's experience, but, I hope, with an equal desire to be just, I have once more endeavoured to ascertain whether any substantial grounds exist for the allegations so freely made that our trade is suffering from the extravagant cost of labour. After a laborious, careful, and impartial inquiry, I arrive at the conclusion, that our industry has not yet been beaten on a large scale by foreign competition, in any case in which that competition has been carried on under identical conditions both as to natural resources and fiscal legislation. The high prices which have prevailed until recently have not been exclusively or mainly due to the cost of labour. The rise of prices. began with a general inflation of trade and the realisation of larger profits. The cycle of events tends to repeat itself in the ebb and flow of commerce. When trade prospers production becomes more active, and a rise of wages ensues. In process of time the augmented supply overtakes the demand for goods. A fall in prices is the inevitable result; and the downward movement is continued until at length the operations of the manufacturer cease to be profitable. A

contraction of business and production takes place; the relation between demand and supply is gradually changed in favour of the producer, and a recovery in prices follows.

I retain an implicit faith in the British workman. If he will but do himself justice, he is as capable as he ever was of holding his own against the world. While, however, I am not discouraged by the dread of competition with the ill-paid labour of the Continent, I have no panacea to offer for our misfortunes. Fewer opportunities will be found of realising large profits. Competition will be more severe. The telegraph and the improved facilities of communication have tended. to equalise prices. A clear and regular profit of seven or eight per cent. must be accepted as a satisfactory return from commercial enterprise. In these unprosperous times the demand for commodities does not increase in the same ratio as our means of production, and the commercial world is brought face to face with a problem of great difficulty in opening out new markets.

A new demand for our goods must be created, and can only be created by cheapness and excellence of quality. The reputation of the country must be sustained by the diligence, the administrative skill, and the high sense of honour and integrity, with which our commerce is conducted.