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Government's Policy on Importations.

26th August 1919
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Page 1, 26th August 1919 — Government's Policy on Importations.
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Which of the following most accurately describes the problem?

THE PRIME MINISTER'S statement as regarteA . trade policy must come as a grave disappointment to all who are interested in the prosperity of the British manufacturing industry.

Considering the motor industry in particular; let us endeavour briefly to sum up the position. • After September 1st there is to be no further restriction of imports. There remains, of course, a temporary duty of 331 per cent. in respect to imported private motorcars, but no duty in respect. to imported commercial motor vehicles. The Prime Minister endeavours to convince us that the equivalent to a duty exists, inasmuch as the exchange between Great Britain andAmerica is doWn to a. figure which gives the sovereign a value of about 17s., which

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s, in effect, comparable to a 15 per cent. tariff. More-. over, he reminds us that freights at the present _moment are very high. On these grounds, he argues that the United States manufacturer can get no profit hy importing into this country) Put the handicap at 25 per cent. What is it after all? k 25 per cent. tariff on top of that is necessary.

On this point We have, of course, the assurance that the Government will protect our industry against (jumping..

It is to be noted, however, that the whole positioh is unstable. The rate of exchange is, of course, subject to frequent fluctuation. Shipping rates are not a constant quantity. If these two togetlie are to be regarded as a safeguard, we have,, then, to place sole dependence upon a variable. It is admitted that., at the moment, the United States has all the advantages in respect of opportunities for economical production. Suppose that the British manufacturer, having gone carefully into the whole question, can calculate the percentage of advantage which his competitor has over him. What he then wants, in. order to plan his future output on a sound Commercial basis, is a certainty of some safeguard which will balance this percentage. So long as he is dependent upon a variable quantity, he possesses no such :certainty.

Let us now look at the whole matter from another point of view. For nearly five years the British commercial motor industry gave itself, heart and soul, to the country's work. It has done so without complaint. It has even, at times, been blamed for submitting. quietly to one restriction after another, the effect of ' each restriction being to shut out the industry, even more definitely, from various markets in which it previously possessed valuable 'goodwill. In fact., the in-. dustry submitted without protest to the forcible transfer of its goodwill into the hands of foreign cornpetitors who were still free to cater for markets from which the British industry ha.sibeen long excluded.

Submission to such treatment was not the result of sapidity nor of any lack of realization of what was going on. It was simply due to the prevalent _feeling that every supreme sacrifice had to be made if by making it victory could be brought nearer.

At the same time, the industry undoubtedly felt that, when the war was over, the Government would take steps to enable it to recover, easily and at no great cost, the goodwill which it had lost. Just as the man who was called up depended upon. his employer to keep his job open till be returned, so was the industry depending on the country keeping open ) its markets so that it could go back to them aftee the war was over. In the majority of cases, the employer has stood. by the man who was called away. In such a. matter, the Government should set the finest example. The nation as a whole must not be open to the accusation of haying let down those upon whom it depended in times of crisis.

Now it looks very much as if the industry were to he treated with indifference and contempt, despite the strength of its case for consideration. When talking of dumping, the, Prime Minister said that this country has nothing to fear from fair competition. This may be true, but can we call competition fair when one competitor is allowed to start with a big lead over the other ?

We recognize that there is a certain genuine demand for some types of vehicles which cannot be promptly filled by British firms. Other trades must be considered besides the motor industry ; therefore, no sensible man proposes the complete prohibition of imports. The majority of us, however, recognize the handicap under which the British industry is placed and wish to see the British industry safeguarded either by the limitation of imports, ra substantial import duty, or a c.ombination of the two together. We know that prices for the time being are high. The motor user who complains of this and would like to purchase cheap foreign machines should first ask himself whether the increase in the price of motors is represented by greater percentage than the increase in the price of the goods in which he himself deals. If not, then he has no immediate ground for complaint.

Moreover, he must look further ahead.. If the home industry is crippled by foreign competition at .a time when it is not ready to meet it, then, sooner or later, the industry will die and we shall become dependent almost entirely upon imports. If that happens importers can do what they like with prices, making them as exorbitant as they please, excopt on those rare occasions when downward manipulation would be necessary to strangle new attempts at competition at their birth.

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