Free Trade vs Tariffs

Indy
7 min readMay 16, 2018

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I’ve got a friend who doesn’t like black and white films. She just won’t have it. Casabl…No. The Third M…No. The Seven Sa…No. Clerks? Maybe she’d like Clerks. Anyway, the past is a foreign country and it’s a faff getting a visa. Working with archives and old stuff sometimes i get lost in the past too. Things don’t make sense. Why are people doing that? What does that mean? Did horses have to have an MOT?

None are perhaps as baffling as newspaper cartoons and election posters, which by their nature are based on issues and personalities that everyone knew well enough so they could be caricatured and in-joked to death. But their meanings stop being meaningful as time passes.

So this is an attempt to give some meaning to a group of political posters on the LSE Digital Library, which initially baffled me but after a little digging i found the issues they talked about are pretty relevant today.

The posters are about tariffs, y’see, which i would imagine are few people’s favourite T-word. However, tariffs are very much in vogue for everybody’s favourite modern day T-word, Donald Trump. Here he is talking earlier this year about his tariff proposals which would place a tax on goods coming from China to the USA and the reasons why he favours them.

The end of the video contains his assertion that the planned tariffs would make the US a much stronger and much richer nation. Trump’s appeal to revived nationhood through control of trade finds close relation with the sentiment of LSE’s pro-tariff posters, many of which used rhetoric and imagery based on nationalism, sometimes very subtly:

Poster produced for the Conservative and Unionist Party, LSE Library
Poster produced for the Liberal Unionist Council, LSE Library

Great trousers, Sam.

So how did these posters come about? They were produced at the turn of the last century and, not to overdo the Trump comparisons, the calls for tariffs were then led by a strong, charismatic personality who had come into politics following a successful background in business. Oh wait, successful. Nevermind.

Joseph Chamberlain was a prominent figure in late-Victorian political life. His route into politics had not been as a result of inherited titles but business. His accomplished leadership of his family firm, which was based in Birmingham and produced screws, led to him turning his hand to different things such as campaigning for free children’s education. He became Mayor of Birmingham in 1873 and took gas and water into public ownership laying the foundations for municipal socialism.

Chamberlain was elected to Parliament as a Liberal MP in 1874 and wore a monocle, along with a trusty orchid and a pair of well-maintained eyebrows. Here he is in a photo taken just after he’d been told ice cream made you bald.

Joseph Chamberlain, 1888, Library of Congress

Chamberlain was a Liberal who supported radical causes such as the extension of the franchise in 1884 which enabled a much greater (though not majority) number of working class men the chance to vote. He was so radical that he left the Liberals in 1886 after disagreements over the subject of Irish Home Rule, co-founded a new party called the Liberal Unionists and threw his lot in with the Conservatives. While he was not a Conservative, Chamberlain was an imperialist and disavowed greater Irish autonomy. The Unionists went into coalition with Lord Salisbury’s Conservatives and won the 1886 election which was dominated by the topic of Home Rule for Ireland. And featured posters like this:

Poster produced for Conservative Central Office, LSE Library

I don’t know either but there’s more information here.

A love for empire and khaki-shorts with a handy blindness to systems of mass global exploitation (i’m guessing at the job description here) happily led Chamberlain to the post of Secretary of State for the Colonies. While here he began questioning the orthodoxy of free trade which had led to cheaper food but also seen the decline of British influence over world trade. He began thinking that Britain could reap rewards if it could encourage trading on preferenetial terms with its existing colonies. The system, named imperial preference, would essentially have meant freer trade between the colonies and Britain, backed by a system of tariffs placed on goods from other countries. A similar idea (though lacking the tariff element) was suggested recently for how the UK could utilise Brexit as an opportunity to foster closer trading ties with the Commonwealth.

Here’s a section from a speech Chamberlain made in Birmingham in 1903 outlining why he thought it a good idea:

Well, you see the point. You want an Empire. Do you think it better to cultivate the trade with your own people, or to let that go in order that you may keep the trade of those who, rightly enough, are your competitors and rivals?

The competitors and rivals Chamberlain mentioned were likely Germany and the USA, not just because of their strong growth but how that growth had been forged. Germany had had for many years protected trade between its territories with a customs union named the Zollverein and at the time of Chamberlain’s speech was one of the leading economies in Europe.

The US had a long history of placing charges on imports to raise funds for the federal government and, again at the time of Chamberlain’s speech, had passed the Dingley Act which put a high tariff on foreign imports. The protectionist prosperity enjoyed by the USA and Germany - at the expense of British workers - was a frequent refrain in the posters:

Poster produced for the Tariff Reform League. LSE Library
Poster produced for the Liberal Unionist Party. LSE Library

I don’t know why The Man Who Feels The Draught felt compelled to pack his miniature (i assume) family into a wooden box but his intense huddled stare suggests guilt and shame.

Poster produced for the Tariff Reform League. LSE Library

Many of the posters were produced for the Liberal Unionists and an organisation called the Tariff Reform League, which was up to set up by Chamberlain to really push the arguments for tariffs.

Poster produced for the Tariff Reform League. LSE Library.

LSE archives also hold the papers of the Tariff Commission, an offshoot from the Tariff Reform League. The Secretary of the organisation was William Hewins who left his job as the Director of an upstart further education college called the London School of Economics to join the campaign.

As previously mentioned, Chamberlain was an MP with a radical and reformist zeal. The Liberal Unionist party campaigned with this poster during the 1895 election which outlined social reforms that he favoured:

Liberal Unionist poster, 1895. LSE Library.
Liberal Unionist poster, 1895. LSE Library.

The pro-tariff campaign also included arguments which were intended to appeal to elicit working class sympathy. One of the central beliefs of the movement regarded global free trade as a rigged system of unfair competition which undermined British manufacturing and the working class. This poster makes some of those points and throws in some casual anti-Semitism. And a dachshund.

Chamberlain was convinced that the tariffs would lead to better protection for British industry, higher wages for workers and could pay for social security in the form of Old Age Pensions which were still a few years away from being introduced.

The argument was, however, countered by the mainstream Liberals, many Conservatives and even the emerging Labour Party. The future Labour leader and its first Prime Minister, Ramsey Macdonald, wrote a book in 1903 called The zollverein and British industry which criticised Chamberlain’s plans, including the risks of tariffs damaging trade:

“Food will increase in price, house rents will tend upwards except in towns where industry is immediately damaged by the change. People with fixed incomes and salaries will have to lower their standard of living. During this change there is nothing more certain than that wages will fall”

Nothing about that quote seems relevant today so let’s move on.

We hold more posters from the Tariff Reform League/Liberal Unionist perspective but this one is pro free-trade and was produced for the Liberal Party:

The Liberals won the 1906 general election, defeating their Unionist counterparts and Chamberlain. They managed to introduce several pieces of social welfare legislation including the first state Old Age Pension and National Insurance, which addressed issues mentioned by Chamberlain’s Social Reforms poster from 1895.

Chamberlain suffered a stroke in 1906 and had to step down from active politics. He died in 1914 but the idea of tariffs as a method of not only shaping and controlling trade but also reinvigorating and protecting nationhood remained much debated for years afterwards. Hopefully these posters give you a sense of some of those arguments then and now.

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Indy

Curator for Economics and Social Policy in the LSE Library. Depreciates faster than Bitcoin.