The New Protection (18 july 1903)
See also his first letter on the same topic: The New Protection (4 july 1903).
The New Protection
[To The Editor of the "Spectator."]
Sir, — I observe that two of your correspondents in the Spectator of July 11th have been good enough to comment upon my illustration of the motor-car, and perhaps you will permit me to show as briefly as I can why these comments fail to convince me. My point was that the introduction of manufactured goods which could be produced in the country was an evil, and I quoted as an illustration the instance of a £1,000 motor-car, and asked whether the country was more benefited by my ordering it in Paris or in Birmingham. The reply of both your correspondents was that I was stimulating the trade of the country more by ordering it abroad, a conclusion which is to me unthinkable. Surely, Sir, presuming that the cars are of approximately the same merit, it is against all common-sense to say that it is better to send this £1,000 to encourage a foreign industry. I am aware that it has been received as an axiom that trade begets trade, but that seems to me to be the very theory which is now upon its trial. Your correspondents both take the view that my £1,000 is not lost to Great Britain, but that it returns in payment of British products. The benefit of a concrete case like this is that one might make an attempt to trace approximately the channels through which the money continues to flow. M. Pan- hard, for example, pays in my cheque, and transfers my money eventually to his banking account. Some proportion of it is expended in the upkeep of his factory, which becomes a valuable taxable asset for the French Government. The balance of the money is divided between the employers and the workpeople. In the expenditure of the employers certain articles of British manufacture may have a place. In that of the workman, with his blue blouse, his vin ordinaire, his sabots, and his whole French outfit, there is very little that could come back to us. He saves some of the money, and it may go to the next Russian loan. Surely it would be a fair statement to say that of that £1,000 not £20 would ever filter back to England. In the other case the whole £1,000 is being devoted to the employment of our own people. Surely it is better to retain that certain £1,000 within the country than to send it forth on the chance of some small proportion of it coming back in trade. It may be fairly argued that this is a special case, and that the balance of trade asserts itself in larger transactions. We buy from America £100,000,000 worth of goods, and return £18,000,000. Where is the balance ? But perhaps there is something exceptional here. From Holland, however, we take £32,000,000, and return £9,000,000. Where is the balance ? In this case it cannot be accounted for by interest on investments or by shipping charges. Belgium gives £24,000,000, and takes £8,000,000. Again, there is no sign of a balance of trade. And all the time the United States, Germany, and even France are improving their position as compared to ours in defiance of all our accepted axioms of political economy. I can understand the attitude of those stalwarts who refuse to be converted by these considerations, but I confess that I cannot conceive how any one could deny the need for an inquiry. — I am, Sir, &c.,
ARTHUR CONAN DOYLE
Undershaw, Hindhead, Haslemere.
[We have dealt with Sir Conan Doyle's letter in our leading columns. — Ed. Spectator.]