Title: Letter to the Right Honourable Lord Viscount Melbourne on the Cause of the Higher Average Price of Grain in Britain than on the the Continent
Author: Sir George Grant Suttie
Release date: April 14, 2011 [eBook #35870]
Language: English
Credits: Produced by The Online Distributed Proofreading Team at
http://www.pgdp.net (This file was produced from images
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The average price of grain in Britain has, for a long series of years, been higher than in the neighbouring countries of Europe. It is of the utmost importance to ascertain the cause or causes of this higher price. The following appear to be the principal:—1st, Scarcity, the effect of monopoly; 2d, The higher rate of taxation in this than in the neighbouring nations; 3d, The higher rate of the real wages of labour in this than in the other countries of Europe.
If it can be proved, that the first is the only cause of the higher average price of grain in Britain, there can be no doubt that it is the interest of every class in the community to have it removed: If the second cause, the higher rate of taxation in Britain, has the slightest influence on the price of grain, the question assumes a very different aspect: And if the [Pg 4]third cause, the higher real wages of labour in Britain, has any connection whatever with the higher average price of grain in Britain, the question of the Corn Laws would then evidently connect itself with the best interests of the country. Those who advocate the abolition of the Corn Laws, assume it to be proved, that the higher average price of grain in Britain arises from scarcity, the effect of monopoly: as, therefore, the cause of the higher price of grain in Britain would be removed by the abolition of the Corn Laws, they assert that the price here would be brought nearly to a level with the price on the Continent, and that the evils which they consider Britain labours under from a scarcity of food would be removed. Now, I believe it will be admitted, that at no period of the history of Britain has the average price of grain so far exceeded the price on the Continent as during the present century; and I think it will also be admitted, that at no period of the history of Britain, or of any other nation, has so rapid an increase taken place in the amount of the population, in the wealth, and, above all, in the amount of taxation actually levied from the people. The state of the case is this: It is asserted, that, for the last thirty-eight years, the inhabitants of Britain have been labouring under the evil effects of a scarcity [Pg 5]of food, as proved by the higher average price of grain in Britain, when compared with the price on the Continent. During the same period, the population has increased in a greater degree than during any former period; and the wealth of the country has increased to such an extent as to excite the wonder and envy of the world; and the substantial nature of this wealth is proved by the amount of the revenue raised from it by taxation, greatly exceeding the revenue of any other country. This view of the question must, I think, dispose any dispassionate person to doubt, that an absolute scarcity of food for the last thirty-eight years in Britain has been the sole cause of the higher average price of grain during that period. In order to prove that a certain effect is produced by a given cause, it is desirable to shew, that the same effect could not be produced by any other cause; and this naturally leads me to consider how far the higher average price of grain in Britain may arise from the other two causes. I think it is admitted, even by those who advocate the abolition of the Corn Laws, that the price of grain is influenced by taxation in the same way, but only to the same extent, as the price of manufactures. They admit that the wages of the labourers must be increased in proportion to the increase by taxation on the price of commodities consumed by[Pg 6] them; and the great leading cause of complaint at the present moment on the part of the abolitionists and manufacturers, is, that in all articles requiring much manual labour, Britain is at present, and must continue to be, undersold in future by the cheaper labour of the Continent. Now, it will not be denied, that manual labour enters to an infinitely greater extent into the production of food than into the production of any other manufacture. If, therefore the manufacturers complain, with justice, that the higher rate of taxation, by raising wages, prevents them from competing with continental manufacturers, the same argument applies to the agriculturist, only with infinitely greater force, in proportion to the trifling assistance which machinery has as yet afforded to manual labour in the production of food. The whole population of Britain would not be able to do for the manufacturers in a year what the steam engine does for them in a day; but coal, the food, or moving power of the steam engine is absolutely cheaper in Britain than in any country in the world. If it is admitted that the higher rate of taxation has any influence whatever in raising or maintaining the price of grain in this country, it must also be admitted, that some degree of protection is just and necessary. With respect to the higher real wages of[Pg 7] labour, if there should appear the slightest ground for thinking that a higher rate of real wages has any tendency to raise or maintain the average price of grain in Britain above the average price of the Continent, any attempt to reduce that price by enabling foreign grain to supplant that of British growth in the home market, must be deprecated as an experiment of the most dangerous nature for the labouring classes of the community. I am aware that I am not entitled to assume, that the real wages of Britain are higher than the real wages of the Continent. Those who advocate abolition of the Corn Laws, point unceasingly to the difference in price between the principal continental markets, such as Hamburgh, Danzig, Berlin, and this country. I might, in the same way, point to the wages in Britain as being at least four times the wages of these countries; but neither would be a fair mode of arriving at the true state of the case. Divide the quarter of wheat, at the average price of each country, by the wages of each country, that will give the real wages of each. Fortunately, Mr Jacob's report on the Corn Trade affords the most satisfactory means for instituting a comparison both as to the price of grain and the rate of real wages in Britain and in those countries. From his report it appears that the average price of[Pg 8] the quarter of wheat for five years, ending with 1824, was 27s. in Prussia. The average price of Britain was, for the same period, 55s. The wages of Prussia are stated to be 2s. 6d. per week, and of Britain, 10s. per week. The real wages, therefore, the quantity of wheat the labourers could purchase, was double in Britain what it was in Prussia. In a national point of view, labour is the true standard of value; if it is admitted that labour in Britain exchanges for a greater quantity of grain than it does in Prussia, it follows that grain is cheaper in Britain.
I shall now advert to what may almost be termed a fourth cause for the higher average price of grain in Britain—the cultivation of poor land. This the abolitionists maintain to be the necessary and natural consequence of monopoly. It would be an arduous task to enumerate all the pamphlets that have been written to prove the immense extent of poor lands at present cultivated in Britain, that must be thrown out of cultivation, in order to supply the labouring population with cheaper bread. It must be borne in mind that Britain, for the last thirty-eight years, has been on a starving system, as proved by the higher average price of grain during that period. The abolitionists[Pg 9] being, however, a little startled at the fact, that a people in a state of starvation, as compared with Prussia or Poland, should have increased in population, in wealth, and in the ability to bear taxation, call to their aid the theory of the cultivation of poor lands. They say the people have not been absolutely starved, but their food has been raised on poor land by an immense and unnecessary expenditure of labour, and their infallible remedy is to throw these poor lands, amounting to a half, a third, or a fourth of the soils of Britain, according to the theory of the different writers, out of cultivation. Import, they say, the cheap grain, the produce of the fertile soils of Prussia and Poland, which being cheaper must be the produce of much less labour. Though volumes have been written to prove the evil effects of cultivating the poor soils of Britain, no one has yet, that I am aware of, devoted a single sentence to prove the fact. It is much easier to take the fact for granted, and then proceed to argue on it. The only argument I have ever heard adduced in favour of the theory, that poorer lands are cultivated in Britain than in Prussia or elsewhere, is, that the average price of grain is higher; but I never can admit the force of an argument deduced from such premises as these, that corn is[Pg 10] high because poor land is cultivated, and that poor land is cultivated because corn is high.
I shall now proceed to state a few facts taken from Mr Jacob's report, which prove the very reverse to be the truth. I may begin by observing, that to any one who has travelled over the north of Germany or Poland, any argument to prove that poorer land is cultivated in these countries than in Britain is superfluous—the general aspect of these countries being that of a sandy desert. Mr Jacob states, that the land in Prussia is cultivated by a class of persons in some respects slaves, and, in most respects, but little removed from that state; and that there is no class in this country with whom their condition can be compared. He states, that the average return of wheat, oats, barley, and rye, is four for one—in Britain the same average is, at least, eight for one. He states, that the stock of sheep and cattle, in proportion to the surface, will be at least four times greater in Britain than in Prussia. In a country such as Britain, maintaining four times the number of cattle, and giving double the return of grain per acre, it is rather too much to assume, without even an attempt at inquiry, that an immense extent of poor and unprofitable land is cultivated. The cultivation of[Pg 11] poorer land in Britain than in other countries, being the key-stone of the arch on which such a mass of argument rests, it seems most strange that no attempt should ever have been made to establish the fact. The higher price of grain may so clearly be produced by other causes besides monopoly, and the consequent cultivation of poorer land, that the abolitionists were bound to prove monopoly to be the sole agent. So far from doing this, many of their own champions admit the force of other causes, as being most efficient in maintaining the higher averages of grain in Britain. Colonel Torrance, who, I believe, is considered a high authority with the abolitionists, states, that if, by taxing our land, we increase the expense of growing corn at home beyond the expense of producing it in other countries, our prices will be higher than theirs. In this opinion I fully agree with Colonel Torrance, though I do as decidedly differ in an opinion he states immediately preceding that above quoted, where he asserts that the happiest consequences follow from leaving importation free. When what he terms artificial sterility is produced by the pressure of taxation on the land, the Colonel does not explain, in his elaborate work, how, if the cause of higher price is taxation, the same amount of[Pg 12] taxation is to be paid by the land, when the value of its produce is reduced from the effects of importation. But even if we admit that a great reduction in the value of the agricultural produce in Britain would not make it more difficult to collect the immense revenue required by this country, still the debt is considered to press with sufficient weight on the energies of the country as it is. As a permanent reduction in the value of the agricultural produce of Britain would give the national creditor the power to purchase a much larger quantity of it than he now enjoys, to that extent it would increase the pressure of the debt, by adding most materially to its real value. In short, the British labourer consumes, or has the power of consuming, at least double the quantity of wheat that a Prussian or Polish labourer has. The soil of Britain, in proportion to its cultivated surface, produces double the quantity of grain, and maintains four times the number of cattle that is maintained by the land in Prussia or Poland. Taxation is admitted by all to raise the money price of grain; and, according to Colonel Torrance, taxation will even produce artificial sterility in land. The amount of the population engaged in British agriculture is less in proportion to the amount en[Pg 13]gaged in trade and manufactures than in any country in the world, yet this small proportion of the people of Britain raises a larger supply of food for the whole population than is enjoyed by any nation of similar magnitude: the whole population consume, or has the power of consuming, double the quantity of food that the Poles or Prussians have.
From these facts it is evident that the food of Britain is produced by much less labour than the food of Poland or Prussia. Indeed, if this was not the case, how could the immense population engaged in manufactures, and concentrated in the large cities of the empire, be supported? I hold, therefore, that I am justified in asserting that the higher rate of taxation in Britain, and the higher rate of real wages, have a very powerful influence in maintaining the higher average price of grain in Britain as estimated in money; that the theory of the cultivation of poorer land in Britain than in the countries from which it is proposed we should obtain our supplies of grain, is utterly without foundation in fact; and that, on the contrary, the agricultural produce of Britain is the result of less labour than in the neighbouring countries of Europe; that labour in Britain produces more grain, and also exchanges for more. It therefore follows, that the mode of introducing[Pg 14] foreign corn into this country ought to be regulated so as not to interfere with the extension of cultivation in Britain, or to prevent the produce from increasing, as it has hitherto done, in proportion to the increase of the population.