Orders of the Day — Finance Act, 1915 (New Import Duties).

Part of the debate – in the House of Commons at on 13 May 1924.

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Photo of Mr Frederick Pethick-Lawrence Mr Frederick Pethick-Lawrence , Leicester West

I am dealing with the arguments of hon. Members who say that, as a result of lower wages and depreciated currency on the Continent, we cannot compete. How docs the argument apply in regard to America, where there are higher wages paid, and the exchange is in the other direction? The hon. Member for Hythe (Sir P. Sassoon) told us that the motor industry was an infant industry. He asked us to realise that six years is much too short for it to mature from its infancy. The Leader of the Opposition referred to the gestation of an elephant, which occupied over two years before bringing offspring to birth. I could not help feeling that, if the hon. Member for Hythe thought that the infant would be more than six years before it was weaned, he must be contemplating an animal with a still longer period of development even than the animal contemplated by the Leader of the Opposition.

Now I come to the main issue on which this Debate has turned. I would put before hon. Members opposite this question. Is this simply a question of Protection, or is it a special matter different from the ordinary Protection issue? Many of the speakers opposite have claimed that this is not a question of Protection or Free Trade, but is a distinct and separate issue. I have not heard one speech from the other side which explains in what the difference lies. I have been waiting to hear what they claim are the specific features of this case as distinct from the Protection case generally. It is true that these duties as originally imposed were imposed for other than Protectionist reasons, but the reasons given by the promoters of these duties originally have been thrown over by hon. Gentlemen opposite, because it was distinctly stated at the beginning that these duties were provisional, and that they would be taken off later on. Hon. Gentlemen opposite have thrown over those arguments, and now that these duties have become Protectionist they are seeking to retain them, and I do feel that this is a test question for the party opposite.

We remember the remark, already quoted on this side of the House, which was made by Disraeli about Protection being dead and damned. I understand that hon. Members opposite do not go as far as that. I think that they do not go as far as admitting that Protection is dead, but I think they say that it is sleeping. If that be so, I want to know exactly whether it is in a fit of somnambulance, or why it is they keep on bringing this sleepy creature to conscious life every now and again. We have had it on other occasions and we have it now. Hon. Members opposite do not seem to realise what it is that we object to in Protection. They ask us, and they are entitled to ask us, is any particular protective duty at the present time doing any harm? I answer simply that every form of protective duty is a restraint on trade, and every form of restraint on trade is bad for industry, and is bad for employment in this country. If hon. Members opposite again attempt to argue that this is a distinct matter, that this is not a question of Protection at all, but is something entirely separate, how long do they propose that the motor duties should be continued? Do they themselves fix any date when they shall be brought to an end? If they do not propose any date when they shall be brought to an end, then they are asking that they should be continued for ever.

I challenge any one of them to explain how this differs from any other type of Protection. We on this side have been challenged with regard to the question of unemployment. We have straight definite answers with regard to it. First, we do not believe that in the long run, or even for any considerable time, this action is going to endanger the position of the motor industry, or other industries which are being protected at the present time by these duties. I believe that when the time does come for the infant to be weaned it will be in the interests of the infant that this should be done. Just as the time comes when a convalescent has to go out and face the elements, so it is in the interests, not only of the home trade, but of the export trade, of this country that the time should come when these industries should be on the open market. I would remind hon. Members that the period of time that the motor industry and these industries have had to put their house in order and face the outside world is nearly double the period which they asked for at the close of the War. They asked for three years and they have had close on six years.

Then I ask hon. Members, do they believe that the result of these duties will be to bring foreign cars into this country? If they say "No," to that, which I do not think they will, then obviously the removal of the duties has done no harm to the motor industry, but if they say "Yes," and still continue to plead that they should be retained, so as to provide employment, I would remind them of the economic fact, which no doubt they will consider merely theoretical, but which nevertheless works out in practice, that goods coming into this country are paid by goods and services going out of the country. Hon. Members smile at that, because it happens to be at the same time both theory and practice, and theory is not a very strong point of hon. Members, but that does not prevent it being true. Anyone who has studied the statistics of this country and the figures of the Board of Trade can verify this for themselves.

We in this House are here to consider the interests of the trade and the workers of the country as a whole, and not the interests of one particular industry, trade or constituency. We have to bear in mind that if there are motors coming into this country they can only be paid for by other goods going out of this country and services rendered, and therefore for every pound's worth of import you get a pound's worth of export or service, and therefore the amount of employment given owing to the increase of oversea trade is fully recompensed, and in our opinion more than recompensed, and more' employment is created than is destroyed owing to any effect produced in these industries themselves. One hon. Member referred to the payment to the United States of America. That payment is made partly in goods, and partly in gold. Hon. Members opposite who think that because it is made partly in gold that negatives the idea of employment being given in this country, forget that we do not mine gold in this country, and that every ounce of gold which we send to the United States we have ultimately to buy by our own industry, which enables us to purchase it from those countries where it is produced.

Summing up the position I would say that hon. Members opposite have failed completely to distinguish between this question and any other question of protection of any kind. That being so they cannot plead that the vote given at the General Election does not fully justify the Government in taking this course. They are in the habit of looking at trade not as a whole but at one particular thing at a time. Consequently they are deluded into the idea that a particular case of protection is for the benefit of trade and employment of the country. The moment you transfer your gaze from one particular spot or industry to the industry of the nation as a whole, you can see clearly that this idea of benefit arising to industry from these duties is not founded in fact. For that reason I shall record my vote in favour of the Government and the removal of the duties.