and natural though it be, is much more ominous and full of warning to us than the new Australian Tariff, about which such an unjustifiable outcry has been made. Rates of duty can be lowered as easily as they can be raised, but the principle of preference once abandoned would be very difficult to revive. I am sorry that the Australians have found it necessary in their own interests to raise their duties, but I would rather see any of the British Dominions raise its duties and still give a preference to British goods than lower its duties and take away that preference. Whatever duties may be imposed by Canada, Australia, or the other British Dominions, they will still remain great importers, and with the vast expansion in front of them their imports are bound to increase. They will still be excellent customers, and the point is that they should be our customers.

In the case of Australia the actual extent of the preference accorded to British goods under the new tariff is not, as has been represented, of small value to us. It is of considerable value. But what is of far more importance is the fact that Australia continues to adhere to the principle of Preference. Moreover, Australia, following the example of Canada, has established an extensive free list for the benefit of this country. Let nobody say after this that Australia shows no family feeling. I for one am grateful to Australia, and I am grateful to that great Australian statesman, Mr. Deakin, for the way in which, in the teeth of discouragement from us, he has still persisted in making the principle of preferential trade within the Empire an essential feature of the Australian Tariff.

Preference is vital to the future growth of British trade, but it is not only trade which is affected by it. The idea which lies at the root of it is that the scattered communities, which all own allegiance to the British Crown, should regard and treat one another not as strangers but as kinsmen, that, while each thinks first of its own interests, it should think next of the interests of the family, and of the rest of the world only after the family. That idea is the very corner-stone of Imperial unity. To my mind any weakening of that idea, any practical departure from it, would be an incalculable loss to all of us. I should regard a readjustment of our own Customs duties with the object of maintaining that idea, even if such readjustment were of some immediate expense to ourselves, as I hope to show you that it would not be, as a most trifling and inconsiderable price to pay for a prize of infinite value. I am the last man to contend that preferential trade alone is a sufficient bond of Empire. But I do contend that the maintenance or creation of other bonds becomes very difficult, if in the vitally important sphere of commerce we are to make no distinction between our fellow-citizens across the seas and foreigners. Closer trade relations involve closer relations in all other respects. An advantage, even a slight advantage, to Colonial imports in the great British market would tend to the development of the Colonies as compared with the foreign nations who compete with them. But the development of the British communities across the seas is of more value to us than an equivalent development of foreign countries. It is of more value to our trade, for, if there is one thing absolutely indisputable, it is that these communities buy ever so much more of us per head than foreign nations do. But it is not only a question of trade; it is a question of the future of our people. By encouraging the development of the British Dominions beyond the seas we direct emigration to them in preference to foreign lands. We keep our people under the flag instead of scattering them all over the world. We multiply not merely our best customers but our fellow citizens, our only sure and constant friends.

And now is there nothing we can do to help forward this great object? Is it really the case, as the Free Traders contend, that in order to meet the advances of the other British States and to give, as the saying is, Preference for Preference, we should be obliged to make excessive sacrifices, and to place intolerable burdens on the people of this country? I believe that this is an absolute delusion. I believe that, if only we could shake off the fetters of a narrow and pedantic theory, and freely reshape our own system of import duties on principles of obvious common sense, we should be able at one and the same time to promote trade within the Empire, to strengthen our hands in commercial negotiations with foreign countries, and to render tardy justice to our home industries.

The Free Trader goes on the principle of placing duties on a very few articles only, articles, generally, of universal consumption, and of making those duties very high ones. Moreover, with the exception of alcohol, these articles are all things which we cannot produce ourselves. I do not say that the system has not some merits. It is easy to work, and the cost of collection is moderate. But it has also great defects. The system is inelastic, for the duties being so few and so heavy it is difficult to raise them in case of emergency without checking consumption. Moreover, the burden of the duties falls entirely on the people of this country, for the foreign importer, except in the case of alcoholic liquors, has no home producer to compete with, and so he simply adds the whole of the duty to the price of the article. Last, but not least, the burden is inequitably distributed. It would be infinitely fairer, as between different classes of consumers, to put a moderate duty on a large number of articles than to put an enormous duty on two or three. But from that fairer and more reasonable system we are at present debarred by our pedantic adhesion to the rule that no duty may be put on imported articles unless an equivalent duty is put on articles of the same kind produced at home. Why, you may well ask, should we be bound by any such rule? I will tell you. It is because, unless we imposed such an equivalent duty, we should be favouring the British producer, and because under our present system every other consideration has got to give way to this supreme law, the "categorical imperative" of the Free Trader, that we must not do anything which could by any possibility in the remotest degree benefit the British producer in his competition with the foreigner in our home market. It is from the obsession of this doctrine that the Tariff Reformer wishes to liberate our fiscal policy. He approaches this question free from any doctrinal prepossessions whatever. Granted that a certain number of millions have to be raised by Customs duties, he sees before him some five to six hundred millions of foreign imports on which to raise them, and so his first and very natural reflection is, that by distributing duties pretty equally over this vast mass of imported commodities he could raise a very large revenue without greatly enhancing the price of anything. Our present system throws away, so to speak, the advantage of our vast and varied importation by electing to place the burden of duties entirely on very few articles. As against this system the Tariff Reformer favours the principle of a widespread tariff, of making all foreign imports pay, but pay moderately, and he holds that it is no more than justice to the British producer that all articles brought to the British market should contribute to the cost of keeping it up. It is no answer to say that it is the British consumer who would pay the duty, for even if this were invariably true, which it is not, it leaves unaffected the question of fair play between the British producer and the foreign producer. The price of the home-made article is enhanced by the taxes which fall upon the home makers, and which are largely devoted to keeping up our great open market, but the price of the foreign article is not so enhanced, though it has the full benefit of the open market all the