430. Burden of tariff on trade and manufactures.—After this survey of the development of English trade in the first half of the century we must attend to a most important change in English commercial policy, which lies mainly in this period. We shall consider three groups of topics: the reform of the general tariff; the repeal of the corn laws, protecting agricultural products, especially wheat; and the repeal of the navigation laws, protecting shipping.

England entered the nineteenth century with a cumbrous mass of tariff regulations inherited from the past, from which only the worst excesses had been pruned by statesmen like Walpole and Pitt. Customs laws had accumulated for 500 years to the amount of 1,500 statutes, “often confused, often contradictory, sometimes unintelligible.” Hardly any ware which was obtainable abroad, whether it was a raw material or a manufactured product, escaped the duties levied under one or another of these laws. The duties were heavy and were enforced with unreasoning severity; a man who imported a mummy from Egypt was told that it was a non-enumerated manufacture, dutiable at nearly $1,000. Internal taxes reached articles which escaped the customs tariff. The taxes on the publication of books were so heavy that they amounted on an ordinary edition to one seventh of the whole cost, and exceeded the remuneration of the author. The cotton manufacturer had to pay not only an import duty on his raw cotton (higher when it was brought in a foreign ship); he had to pay an excise or internal tax on calico which he printed; and he had to pay taxes, in one form or another, on all the important materials he used in manufacture,—flour, starch, leather, soap, dyestuffs, paper, timber, brick, tiles. A man could not build a factory, or run it, or feed and clothe his workmen, without paying taxes at every step.

431. Prevalence of smuggling.—A partial relief from the burden of the customs was obtained by smuggling. Tariffs could hinder but could not absolutely stop the natural movement of commodities. Smuggling was a regular profession, with a tariff modeled on the regular tariff, but enough lower to invite business; the smuggler’s charge varied ordinarily from 15 to 40 per cent ad valorem. Large numbers of the common people were leagued with the smugglers to defy the law, and the upper classes, even the legislators themselves, accepted smuggling as a matter of course. A member of the House of Commons once flourished his silk bandanna handkerchief before the House, saying: “Here is a foreign ware that is totally prohibited. Nearly every one of you has a similar illicit article in his pocket. So much for your prohibition.” The government framed its duties with an eye to the ease of evading them; it laid a higher duty on fancy silks than on plain, because the smugglers were at a disadvantage in handling the former, which had to be brought in at once, before the fashions changed, while plain goods could wait the smuggler’s convenience.

432. Beginning of the reform movement, 1820.—More and more as time went on, and England’s commercial capacity increased, were the evils and abuses of the system appreciated. By 1820 the times were ripe for a change, and the movement to reform was initiated in that year by a petition from a group of London merchants. The petition urged the principle of free trade which the economist Adam Smith had supported in his “Wealth of Nations” (published in 1776), and prayed that all restrictive regulations, not imposed on account of the revenue, including all duties of a protective character, might be repealed at once.

433. Reform of the tariff under Huskisson.—The early stages of tariff reform, effected under the leadership of Huskisson about 1825, included the following: (1) The simplification and condensation into manageable form of the customs laws. (2) Reduction or removal of the duties on raw materials. (3) Reduction of the duties on manufactures, generally to 30 per cent or less, on the principle that such a duty was ample for protection, if a ware could be made at home to advantage. (4) The removal of most of the restrictions on export. These restrictions had affected raw materials, partly manufactured goods, and even artisans themselves. The government had tried to keep skilled workmen at home, but found that it merely made them discontented, forced them to evasions, and kept them from coming back when they had once left the country: it left them henceforth free to emigrate. It was still unwilling to allow machinery to be exported freely, for fear that other countries would build up a competition in manufactures, but it recognized the difficulty of making its restrictions effective, and relaxed them greatly.

434. Results and later completion of the reform.—The results of the reform exceeded anticipations. Not only did those industries benefit which (like cotton, for instance) had previously been taxed for the support of others, but the protected industries themselves gained by the revision of the laws. The export of woolen stuffs increased rapidly after the removal of the prohibition on the export of raw wool. The silk manufacture, which had made slow progress and secured only a small market under the system of high duties and prohibitions, advanced more rapidly now in a decade than it had done before in a century.

The work of reform was, however, still far from complete; the tariff retained many incongruities and was felt still to be oppressive by the business interests of the country. The second stage in the advance to free trade was effected under Sir Robert Peel, who in 1842 secured the reduction of duties on 750 articles, and in 1845 abolished 430 out of a total of 813 import duties. Peel’s reforms left still a considerable element of protection in the tariff, and the final acceptance of free trade waited till Gladstone’s laws of 1853 and 1860, which lowered and then swept away import duties by the hundred, and left the English tariff substantially in its present shape. The system of “free trade” which England has since maintained does not imply a complete lack of import duties; more than one fifth of the total revenue from taxes is now yielded by the customs. Import duties, however, have been restricted to a very few commodities, and are “revenue,” not “protective” duties, in the sense that they do not encourage the production in England of anything which can be produced more cheaply abroad.

435. The corn laws and their effects.—Previous to the great changes which turned England into a manufacturing country, the agricultural interests which controlled Parliament had assured themselves a good measure of protection in framing the tariff laws. The importation of grain was prevented by high duties; and the export was favored by bounties when the supply was relatively plentiful and the price fell below about $1.50 a bushel. Export became more and more rare as the home demand for foodstuffs grew with the increase in the industrial population; and toward the close of the eighteenth century it became ever a more serious question whether England could produce at home sufficient food for her growing people. An attempt was made to arrange the laws so as to keep the price of wheat steady at about 48s. a quarter ($1.50 a bushel), but the laws did not succeed in preventing violent fluctuations in the price. At the close of the great wars, in 1815, English agriculturists demanded a continuance of the protection which the stoppage of commerce had afforded them and the import of foreign wheat was prohibited so long as the price at home did not rise above 80s. (about $2.50 a bushel, or about $.30 for the quartern loaf of bread). Landlords got high rents as a result, but farmers who leased their land suffered when prices fell to a reasonable level, and consumers were forced to pay extortionate prices for a prime necessity. Hundreds of thousands of the working classes were brought to the verge of starvation in 1817 by the price of wheat rising to 112s. (about $3.50 a bushel).

436. Movement of English manufacturers for a repeal of the corn laws.—The House of Commons, even after the electoral reform of 1832, afforded but little representation to the manufacturing and mercantile classes; four fifths of its members belonged to the landed interests, and though they made some slight concessions they refused to grant adequate relief. It was necessary for the opposition, which organized under the name of the Anti-Corn-Law League, to carry on its campaign outside of Parliament; it could report, at the annual meeting of 1843, that nine million tracts had been distributed, and meetings had been held in 140 towns. Inside of Parliament the movement engaged the energies of orators like Cobden and Bright, who saw in it a question of life and death for English manufactures. How was the manufacturer to pay the wages which such a costly food supply required? To whom was he to sell his goods when so large a proportion of English incomes had to be expended for bare necessaries, and when England refused to take from foreign countries the commodities which they offered in exchange? Even among the agricultural classes the landlords were the sole gainers. The agricultural laborers were wretchedly poor; Cobden asserted that none of them spent more than about $7.50 a year in manufactured articles, if shoes were excepted, and that they bought a smaller amount of English manufactures than the people of Brazil.

437. Repeal of the corn laws and its significance.—With the passage of time and with the growth of the industrial population conditions changed from bad to worse. The combination of a bad harvest and bad times in business in 1841 forced thousands of the manufacturing population to seek poor relief, while other thousands were estimated to be earning on the average less than a shilling a week. It needed only a shock like that given by the crop failure in the first year of the Irish famine, 1845, to force the change which had come gradually to be recognized as inevitable. Peel’s act of 1846 left a slight protection for a few years; but after 1849 only a nominal duty was to remain, and even this was abolished later.

The repeal of the corn laws was a momentous act in English history. It marks the formal and final recognition that England had grown from an agricultural to an industrial and commercial state. It threw England, as an English economist said, from corn to coal as the staple product of the country. Manufactures and trade thenceforth developed freely. Even the agricultural interest gained in ways which it had not foreseen: the consuming population increased rapidly both in numbers and in purchasing power, and demanded increasing quantities of meat, dairy produce, vegetables, and fruit. The full effect of the change on commerce will be apparent when we review the history of the last half of the century.

438. Reform of the navigation acts.—This survey of the course of English policy in the first half of the nineteenth century will be closed by the consideration of a third topic, the laws protecting shipping. Reference to a previous chapter will show how severe were the restrictions meant to prevent the competition of foreign shipping, in the seventeenth and eighteenth centuries. The period now under consideration was marked by the removal of all these restrictions, and by a great growth, notwithstanding, in the English merchant marine.

The establishment of the independence of the United States, and later of the Spanish American republics, overthrew the colonial theory on which many of the navigation acts were based, and forced numerous revisions. The long wars of the Napoleonic period, also, led England to grant privileges to neutral powers in the carrying trade. Important breaches, therefore, had been made in the old system before the century was far advanced, and it was in no condition to withstand the assaults directed against it by people both abroad and at home whose interests it injured. The United States adopted a policy of reprisal which forced England to admit American ships freely to English ports, and threats of similar action by European countries led in 1824 and the years immediately following to a series of treaties putting foreign ships on an equality with English.

439. Final repeal of the navigation acts.—The navigation acts had grown into a most complicated system, and it is impossible to describe in detail their gradual relaxation. By 1830 English ships had lost all their privileges except in the coasting trade, and in the trade with and between the colonies. Even this amount of protection came to be regarded as a burden not only on commerce but on shipping itself, and was abolished in 1849 and 1854. Every step in the reform of the navigation acts was bitterly fought by adherents of the old system, who prophesied ruin to English shipping if it were denied protection and left to make its own way. How groundless were the fears of those who opposed reform can be seen in the following table, giving in millions the tonnage of English ships in the period 1800-1850: 1800, 1.6; 1810, 2.2; 1820, 2.4; 1830, 2.2; 1840, 2.5; 1850, 3.5.

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