confined to the classes immediately connected with the staple commerce
of the port, but pervades all classes of the community without
exception. The produce of half a world is stored in the warehouses of
Liverpool, or floating in her magnificent docks. The capital of her
merchants is embarked in every clime, and her shipping crowds every
foreign port; yet her industrious population are plunged in suffering
and embarrassment, and a portion of them—her labouring classes, pressed
down by the influx of pauper competition from the hordes of immigrants
from ruined Ireland—are continually upon the verge of actual starvation.
It is distressing to witness the shifts to which tradesmen are compelled
to resort, from time to time, in order to meet engagements, and to stave
off, by sacrifices of their goods, the day of ruin. “Selling off”
announcements, under all kinds of pretexts, meet the eye in every
direction, and yet tempt in vain. The whole community appear to be
economising; and tardily paid bills, and reduced expenditure in the
comforts, and even in some of the necessities of life, is the rule, not
the exception. The extent to which this is carried, and the suffering
existing amongst the middle classes, may be judged of by the fact that
it has already affected the incomes of many of the clergy of the town,
by diminishing the numbers of their congregations and the yield of
pew-rents. In one instance which has been mentioned to me, the income of
a clergyman, universally beloved, has been thus cut down from £600
a-year, to little more than half; and this is far from being a solitary
case.
The result of this state of things is already being felt in a strong
reaction, amongst those once the loudest in its advocacy, against the
system of Free Trade. Doubts are freely hazarded with respect to the
soundness of a policy which has produced such fruit; and the question is
upon the lips of numbers,—“Where is the prosperity which was promised to
us?” If Mr Cobden or Sir Robert Peel were to present themselves in
Liverpool at the present moment, they would have to answer this
question, not to the uninquiring crowds who would have cheered their
fallacies three years ago, but to men who have reflected deeply, and had
deep cause for such reflection. The Right Hon. Baronet, in particular,
would perhaps have to reply to another question, and to go a little back
in the history of his political life. He would be asked not only, Who
had benefited by his Free-trade measures?—a difficult one enough to
answer—but what class of the community had been aggrandised _by his
currency measures of 1819 and 1844_. To this vital subject the minds of
the intelligent mercantile community of Liverpool, of all shades of
politics, are being rapidly directed. The Free-trader sees, in the
operation of our monetary laws, one leading source of the evil brought
upon the country by the carrying out of his favourite measure. He is
prepared to acknowledge that Free-trade and a Restricted Currency are
incompatible things. And the mercantile body of all political parties
still remember the disasters of 1847 and 1848; and the insulting manner
in which their prayer, in the October of the previous year, for relief
from the unexampled money pressure, which was then prostrating the most
extensive and solvent firms, was denied by a flippant and shallow
Chancellor of the Exchequer, although at that moment the nation was
within a few days of bankruptcy. These things are not forgotten; and,
from the impressions which I have been able to form, from a close
examination of popular opinion, I should not be surprised to see the
influential community of Liverpool throwing politics and party to the
winds, and uniting their efforts to procure a relief from the monstrous
system which at present withers and strangles in its grasp the industry
of England—which tempts us one day, by its lavish kindness, to erect
vast structures of commercial enterprise and usefulness; and the next
day dashes them into wrecks before our eyes, to be scrambled for by
greedy extortioners and selfish usurers.
It is the fear of this power which, to a great extent, is at the present
moment paralysing the enterprise of the commercial communities, which
would otherwise have succeeded in neutralising a portion at least, but
certainly only a portion, of the ruinous effects of Free-trade. A few
years ago, no community embarked more largely in those railway
investments, so strongly recommended to them by the fosterer of the
system, Sir Robert Peel, than the mercantile people of Liverpool. The
extent to which such investments were encouraged by the lavish offer of
banking facilities to merchants and others, may be judged of by the
fact, that the Directors of one Liverpool Bank were, a few weeks ago,
compelled to acknowledge to their shareholders, that nearly the whole of
their subscribed capital was advanced upon railway stock; and that their
Rest, amounting to £100,000, had entirely disappeared. This species of
security is now, by the caution with which capitalists act, rendered
totally unavailable for the purpose of raising money, when required for
legitimate commercial purposes. Hence the timid apprehension with which
men, thus situated, regard the accumulation of stocks of produce, for
which no remunerative market at present offers itself; and the
consumption of which is so obviously on the decline. Hence also the
pressure to sell, when they see cargo after cargo pouring in to augment
those stocks; the unwillingness to part with funds, for which the
shopkeeper and the tradesman are eagerly longing, to enable them to
sustain their tottering credit; and that total suspension of all
internal enterprise and improvement, which is driving so many thousands
of our skilled workmen to other countries, and the labourer to that
desolate resort for the very poor—the Union Workhouse. To the attempt to
carry out a Free-trade, involving the holding of large stocks of produce
and extended operations in foreign markets, with a currency artificially
restricted by the last Banking Act of Sir Robert Peel, and further
restricted by the caution with which bankers are now conducting their
business, since the severe warning inflicted upon them in 1847, is
attributable not only the commercial depression already noticed, but
also that fearful sacrifice of realised capital, which has taken place
from the decline in the saleable value of railway shares, and which, in
Liverpool alone, has rendered hundreds of once wealthy men comparatively
poor ones, and brought many, in the decline of their days, to a
condition lower than that even in which they began the world.
Such is the condition generally of the mercantile community of
Liverpool—that port of all others in the kingdom which was most largely
to be benefited by the advent of the Free-trade system. From the apex to
the base of the social fabric all is uncertainty, fear, and suffering,
too intense any longer to be concealed from the most superficial
observer; and the crisis has not yet been reached. The reaction has
still to come from the manufacturing districts, which, up to within the
past few months, in the enjoyment of a moderate amount of activity,
caused by a temporary revival of the export demand, are only now
beginning to feel the results of the system which, in their selfishness,
they invented for their own aggrandisement, at the expense of the
industry of the whole empire.
The avowed object of the Free-trader was to stimulate the export trade
in cotton goods, which it was always boasted was the most valuable to
the manufacturer. So far as regards the quantity of the raw material
consumed for the export trade, this is an undisputed fact; but that the
amount of skill and labour employed in it is equal to that expended upon
goods consumed in the home market is not true. In order to arrive at an
idea of the relative value of the two trades, it will be necessary for
me to bring before the reader a few figures and authorities. In the
excellent _Commercial Glance_, compiled for many years by the late Mr
John Burn of Manchester, and now continued by his son, the following
statement was given, as the mode in which the cotton spun in 1845 was
disposed of. I take that year as being one of great prosperity in the
home market, and as showing the state of things antecedent to the
introduction of free trade in corn.
STATEMENT OF THE COTTON SPUN IN ENGLAND AND SCOTLAND IN 1845, AND OF
THE QUANTITY OF YARN PRODUCED, SHOWING ALSO HOW THE QUANTITY SPUN IN
ENGLAND WAS DISPOSED OF.
Lbs.
Total cotton consumed, in lbs., 555,527,283
Allowed for loss in spinning, 1¾ oz. per lb., 60,760,796
———————————
Total yarn produced in England and Scotland, 494,766,487
Deduct spun in Scotland in 1845, 27,737,022
———————————
Total spun in England in 1845, 467,029,465
Lbs.
Exported in yarn during the year, 131,937,935
Exported in thread do., 2,567,705
Exported in manufactured cotton goods, 302,360,687
Estimated quantity of yarn sent to Scotland and
Ireland, 10,734,859
Exported in mixed manufactures, consumed in
cotton banding, healds, candle and lamp wick,
waddings, socks, calender bowls, paper,
umbrellas, hats, and loss in manufacturing
goods, 31,655,230
Balance left for home consumption and stock,
1st January 87,773,049
————————————
467,029,465
===========
I have the most perfect confidence in the correctness of Mr Burn’s
calculations, being personally acquainted with that gentleman, and
knowing the excellent sources from which he derives his information, and
the care which he devotes to the accuracy of all his facts. The result
to which the above statement leads is, that the consumption of raw
cotton in goods sold in our home markets is 18·36 per cent only, upon
the total quantity of yarn spun in England. This, a superficial observer
will say, is a very trivial quantity for our boasted home consumption.
Let us see, however, in what stage of manufacture, and in what
description of goods, the cotton taken off by foreign markets
principally consists. In the first place, 131,937,935 lbs., or 28 per
cent of the total cotton spun, was exported, as shown in the table
above, in the shape of yarn, an article but one remove from the raw
material, and the manufacture of which employs machinery principally,
and leaves only a small margin of profit to the country. With respect to
the description of goods, in the manufacture of which for the foreign
market the remainder of the raw material is consumed, little difficulty
is felt by persons acquainted practically with the subject. Mr
M‘Culloch, in his _Dictionary of Commerce_, page 456 of the edition of
1847—the latest I have before me—remarks upon the facts as striking,
that, notwithstanding the superiority of our machinery, and this branch
thus being one in which we most greatly excel our foreign rivals, the
proportion of fine to coarse yarns spun has materially decreased; and
that, in fact, the actual quantity of fine yarns has decreased, whilst
the total consumption of cotton has quadrupled during the last
twenty-five years. That the quantity has decreased to this extreme
extent may well be doubted, although the cheapening which has taken
place in silk and other fabrics during this period has, we know, to a
great extent caused the disuse, for home consumption, of many once
highly prized articles of the cotton manufacture. We may accept,
however, the admission of Mr M‘Culloch, as bearing upon the quality of
those goods which are taken off by the foreign trade, and of which the
great increase in the manufacture must consist. These are, confessedly,
the coarse, heavy fabrics, into the manufacture of which the _minimum_
amount of skill and labour enters. We approach then, from this point, to
a view of the comparative value to the country of the home and the
export trade in cotton goods. In the same work, Mr M‘Culloch estimates
the total annual value of the cotton manufacture of the kingdom at
£36,000,000 sterling, of which £10,000,000 is put down for the cost of
the raw material, £17,000,000 for wages, and £9,000,000 for profits,
wages of superintendence, and cost of machinery, coals, &c. I am a
little inclined to believe that this calculation is underdrawn, the
leaning of the author being to exaggerate the importance of the export
trade, the declared value of which in 1845 was £26,119,231, leaving a
little under £10,000,000 as the consumption of the home market, or about
two-fifths of the consumption of the foreign. In estimating the value to
the country, however, of the home trade, we have a right to take into
consideration the fact that the great component material of the goods
which we consume at home consists of labour; for, whilst the proportion
of the raw material consumed in the home trade was little over one-fifth
of that consumed in the foreign, the value of the goods was two-fifths.
Admitting, however, Mr M‘Culloch’s version of the case to be correct,
but at the same time bearing in mind the fact of his being a somewhat
prejudiced authority, let us apply the figures given to the present
condition of the manufacturing interest. The average quantity of cotton
taken weekly from Liverpool for consumers’ use, was, from 1st of January
to 12th of April 1849, 29,475 bales. It has been this year, up to the
same date, 23,176 bales—a falling off of 6299 bales weekly, or a little
above a fifth of the preceding year’s importations. Perhaps a portion of
this decline in apparent consumption may be accounted for by the fact
that the stock in the hands of spinners has, to a considerable extent,
been allowed by them to become exhausted, through their unwillingness to
pay the advanced prices recently demanded for the raw material. With
respect to the prudence of this policy, and its probable effect in still
further increasing the embarrassment of affairs, I shall have something
to say by and by; at present, the question which presses is—In what
market has this decreased consumption occurred? The answer must be—In
that market which pays for the greatest amount of labour expended upon
the manufacture of cotton goods—in the home market. I have not within my
reach the most authentic record of the Cotton Trade, for the period up
to which I should desire to extend my inquiries—viz., _Burn’s Commercial
Glance_, which is only made up half yearly. I have, however, before me
this gentleman’s _Monthly Colonial Circular_, dated March the 18th, in
which I observe a considerable increase in the exports of plain
calicoes, printed and dyed calicoes, and cotton yarn to the following
markets, with a few exceptions, for the first two months of the present
year:—Calcutta, Bombay (increase in printed and dyed and in yarn, and
small decrease in plain only); Madras (considerable increase in plain
and printed and dyed, and small decrease in yarn); Singapore and Manilla
(small decrease in printed and dyed and in yarn only); Batavia (large
increase in all kinds); Hong Kong and Canton (large increase in plain,
and small decline in printed); Shanghae (trade removed to other Chinese
ports in which there is a large increase): Australian Colonies (increase
in all kinds); Mauritius (stationary); Cape of Good Hope (increase in
all); Coast of Africa (decline in all); Jamaica (decrease in plain and
increase in printed); Honduras (increase); other West Indian ports
(decrease); Cuba and St Thomas (both increase); French West Indies
(increase in printed and small decline in plain); Brazils (large
increase); Chili and Peru (large decrease); Colombia (decrease); River
Plata (considerable decrease); Mexico (increase in plain, and decrease
in printed); British North America (season for shipments not commenced);
and United States (increase in both printed and plain, and a large
business done, the shipments for the two months being upwards of half of
the entire quantity exported in 1849.) Compared with the average of the
same period of the preceding three years, there is an increase to nearly
every market. With respect to the shipments to European markets, I
cannot speak with precision as to quantities, from the circumstance,
which I have named, of the accounts not having been yet made up. From
the monthly return from the Board of Trade, however, it appears that a
general increase has taken place in the declared value of cotton
manufactures to all markets, the amount being in 1850, £3,264,350 for
the two months, against £2,837,300 last year. There is a very trifling
decline in the export of yarns. From my own observation, I should augur
that the increase has extended over March, to the United States and the
markets of the Pacific especially—an unusual stimulus having been given
to the consumption of these markets by the Californian discoveries. By
the bye, I ought to mention, in connexion with the increase in the
declared value of our exports this year, the fact that, owing to the
advance in the price of the raw material, the value of goods exported
will be rated higher than last year. To some extent, however, the severe
winter of this year preventing the early opening of the navigation of
the rivers of the north of Europe, as compared with the mild season last
year, may be a set-off. The Mediterranean trade, and the operations of
the Greek houses, have also been limited by our petty quarrel in this
part of Europe.
Assuming, however, the actual quantity of cotton consumed by the Export
Trade to have been equal to that consumed last year up to this period,
and allowing for 40,000 bales, alleged by spinners to have been drawn
from their own stocks instead of the Liverpool market, _there will
remain a deficiency, as compared with last year, of 5000 bales per week,
or 70,000 bales, in the consumption of the raw material manufactured
into goods for the Home market_. When it is considered that these goods
consist of the finer fabrics, in which the greatest amount of labour is
employed, and upon which the largest percentage of profit is realised,
whilst those consumed in the foreign markets are sold at the lowest
margin of profit, and when exported frequently result in heavy losses to
the shipper, the extent of the sacrifice made by the manufacturing
community, in their mad adoption of a policy which has destroyed the
Home market, may readily be seen.
The correctness of these calculations has been borne out by the general
character of the Home Trade during the past four months, in which
stagnation, and difficulty in accomplishing sales to consumers and
retailers throughout the country, early manifested themselves. In the
month of January, strong hopes were entertained, by the majority of the
houses engaged in this branch of the business, that the worst of the
embarrassment which had so long hung over the cotton manufacturing
districts had passed over; and that a wholesome and active trade was
before them. The circulars of the month of February, and the reports
given week by week in the local journals published in the manufacturing
districts, resumed their gloomy statements; and the home demand, it
became clear, had returned to its previous lethargic state. From
communications entered into with some of the country houses, I have
derived intelligence respecting the result of their operations, almost
precisely similar to those sent home by the representatives of produce
houses as given above. The country buyers who come to the market display
an entire want of their accustomed spirit, and buy sparingly an inferior
class of goods to those which they have been, in former years, in the
habit of consuming. The universal complaint of these parties, and of
commercial travellers engaged in the Home Trade, is of declining
consumption and ill-paid accounts, especially throughout the purely
agricultural districts. One circumstance has tended in some measure to
prevent the trade becoming absolutely ruinous—viz., the fact that cotton
fabrics are now resorted to by many classes from motives of economy. The
farmer’s and the tradesman’s wife and daughters make a fashion of
necessity, and substitute printed cotton dresses for more expensive
articles. A cotton shirt supplies moderately well the place of a linen
one. Articles of elegance and luxury, however, even of this material,
are complained of as most difficult of sale. In some of the large towns,
a few houses are doing a fair business in heavy fabrics, such as
fustians, moleskins, and other articles worn by the artisans and other
working classes; and in some fancy goods of the same description for the
middle classes. This fact, however, is in a great measure an _exemplar_
of the declining condition of the country generally, the articles in
question being worn, in a majority of cases, as substitutes for the more
costly woollen fabrics. Moreover, no profit accrues to the manufacturer
from these goods, their production at existing rates of the raw material
being, on the contrary, attended with absolute loss.
The retail trade in the manufacturing towns themselves, represented as
being in such a satisfactory condition, is anything but good, a
considerable portion of the population being employed only two or three
days in the week, and the whole having been compelled during the past
two or three years to submit to reduction of wages, as the price of
their boasted boon of Free-trade. This is particularly the case in the
districts of Rochdale, (John Bright’s district,) Heywood, Bury,
Middleton, &c. The effect of preceding years’ short-time working is
still severely felt, last year having been the only one since 1846—when
we had the boasted measure of Sir Robert Peel, and the “heavy blow and
great discouragement” was inflicted upon British agriculture and our
sugar-growing colonies—that the manufacturing population have been fully
employed.
Such being the acknowledged condition of the home market for
manufactured goods, the question naturally presents itself—what has been
the result, so far as profit is concerned, of the operations generally
of the manufacturing community during the past four months? In reply to
this question, it will be very easy to prove that thus far, in the
present year, they have been the reverse of remunerative. The following
extract from the circular of Messrs M‘Nair, Greenhow, and Irving, of
Manchester—one of the best published, although putting rather the best
face upon things—dated the 31st of December last year, will show the
prospects with which manufacturers entered upon the present year:—
“MANCHESTER, _Dec. 31, 1849_.
“Exactly twelve months ago we represented the transactions of the
closing month as having been almost unprecedented in extent,
considering the season of the year; and to-day we are happy to have in
our power to communicate a pretty similar statement with regard to the
present month, repeating what we have often remarked, that _December_
in ordinary years is generally marked by dulness and inactivity.
“The position of the market, as indicated in our last (monthly)
circular, continued for about ten days afterwards gradually acquiring
greater force and depression, and accompanied with a decline in the
value of many descriptions of cloth and twist. At that period, from a
very prevalent belief that the commencement of the new year would be
characterised by improvement, an active and vigorous demand for export
and the home trade ensued, which has, notwithstanding the interruption
of the holiday season, continued up to the present time, rendering the
stocks of all kinds of light goods, as well as of some numbers of mule
twist, exceedingly light, and placing many manufacturers and spinners
under contract for some time hence.”
Another authority, Messrs Hollinshead, Tetley, & Co., an old-established
cotton firm of Liverpool, who are generally in the possession of the
best information, remarked upon the prospects of the district in their
circular of the first of January as follows:—