Part IV: Colonial and Fiscal Policy, Colonial and Fiscal Policy

‘What is the reason,’ asked Cobden once when he was discussing the fiscal relations of Ireland to Great Britain ‘why no statesman has ever dreamt of proposing that the colonies shall sit with the mother country in a common Legislature?’ His answer goes to the root of the matter. ‘It is not because of the space between them, for, nowadays, travelling was almost as quick as thought; but because the colonies, not paying Imperial taxation, and not being liable for our debt, cannot be allowed with safety to us, or with propriety to themselves, to legislate on matters of taxation in which they are not themselves concerned.’ If representatives from the colonies were allowed to sit in the House of Commons ‘an ambitious and unscrupulous minister would be sure to make use of them for the purpose of oppressing the English people.’ Such a minister, observed Cobden, might say to the Canadian representatives, ‘Help me in such a case, and I'll help you to prevent England from putting a tax on Canada.’ In short, Imperial federation would mean irresponsible government. The object of the Manchester School was not an empire but a commonwealth of autonomous communities. If you have to choose between self-government and good government choose self-government. But that uncomfortable choice has never presented itself in the case of a real colony. The rule of Downing Street over distant communities of European race has always been unsatisfactory to the colony and costly to the mother country, not seldom oppressive, sometimes provocative of war and disastrous to civilization. In 1877 Mr. Bright was asked what he thought of the protective policy of Victoria. In the course of a letter which breathes throughout the spirit of political toleration he made some observations which false exponents of the Manchester School should lay to heart: ‘If a Government voted a sum of money to support a steamboat enterprise which was deemed of great service to the country, but which from its novelty or its risk private capitalists would not undertake, I should say that in doing this no sound principle would be broken, and that the public interest might possibly be wisely served. So if a Government thought that if a new culture might be introduced into the country, such as the grape or tea, it might appropriate a sum of money to make that experiment, leaving its future progress or fate entirely to the industry and disposition of the people.’ Here is one of the leaders of the Manchester School perfectly ready to admit the propriety of Government enterprise in certain cases. Does this involve a weakening in doctrine? Let us continue the quotation: ‘But to enact a tariff imposing heavy duties on most important articles of comfort, to establish an oppressive and costly system of custom-houses, to build up special interests before their time, or industries which might never thrive in the free air of competition, at the expense of taxation upon the whole people, levied partly at the custom-houses, and partly by the high prices which are sought to be obtained on the home-made and protected article, is a policy so unsound and so injurious that I am greatly surprised that any one in the least acquainted with me or with my life should have supposed it possible that I should have given it my support.

‘Englishmen form colonies at a distance from the mother country. They throw off many of the superstitions which are still to a large extent cherished in England. In respect of protection by means of a prohibitive or restrictive tariff, the colony of Victoria clings to a superstition or error which we in England have abandoned. Our experience is conclusive as to the wisdom of our policy. Victoria is young, and thinks she knows more and better than we know. But when she finds herself, not at the head, but at the tail of the great Australian communities as to her success and the growth of wealth, she may discover that industry has no greater enemy than a protective or restrictive tariff.’

One of the principal objects of colonial emancipation was to get rid of the cost of military and civil establishments in our distant possessions and so to free large sums of money for fiscal and social reform at home. Experience had shown that governors armed with large powers are a constant source of danger and expense. The colonial system was a system of political and fiscal bondage. Imperial tariffs as well as imperial governors were maintained by soldiers and ships of war. In the speech of Sir William Molesworth the character and cost of the old system, to which we are now invited to return, will be found very faithfully depicted. As we have already seen, Molesworth's speech was endorsed by Cobden, and no student of English history during the second half of the nineteenth century will deny that the policy outlined in the speech, and in the letter which precedes it, was carried out with extraordinary fidelity by successive parliaments. The two extracts dealing with the German Zollverein, and with the proposals for a British Customs Union, complete our view of the colonial policy of the Manchester School.