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Lord Sydenham
Chapter III - Vice-President of the Board of Trade

THE unquestioned success which Poulett Thomson had scored in the House of Commons had already completely reconciled his friends to his new sphere of activity, despite the heavy expense of frequent elections during these unsettled years.

During 1830 several important events occurred. George VI died and was succeeded by William IV, necessitating a new election. Huskisson having met with untimely death, the suggestion was made that Poulett Thomson should be chosen to succeed him in the representation of Liverpool; but a strong local candidate coming forward, the idea was dropped. Finally, in November, 1830. the Duke of Wellington's government resigned and Earl Grey came in at the head of the first administration pledged to reform, though some of its members were not very ardent in that cause,, Viscount Althorp was the new Chancellor of the Exchequer, and his high appreciation of Poulett Thomson's abilities led to his being offered the position of vice-president of the Board of Trade and treasurer of the navy.

With the death of Huskisson the public seemed to turn to Poulett Thomson as the natural successor of that distinguished advocate of large views and Liberal principles, and as the fitting representative of the rising commercial and industrial interests of the country. Moreover, Poulett Thomson, in addition to his wide grasp of economic conditions and needs, was much more tactful and discreet than Mr. Huskisson had been in dealing with the public, and especially with opponents. The president and nominal head of the Board of Trade in this ministry was Lord Auckland, who was, however, a very reticent and colourless minister, commonly understood to have been added to the cabinet more for ornament than use, it being necessary to have a few peers in the ministry of reform to give it an air of respectability. Poulett Thomson, therefore, was virtually head of the department, and represented it in the House of Commons. He became actual president of the Board in 1834.

Mr. Thomson's appointment made it necessary for him to withdraw from active participation in business, hence the partnership with his brother was dissolved. As he was re-elected without opposition, he immediately applied himself with characteristic energy to his new duties, seeking to realize in office what he had advocated in opposition. In practice almost every reform, from the very nature of the case, involves the sacrifice of some vested interest or pre-established claims. Thus, for instance, when during the war foreign allies were irregular in their supply, heavy duties had been imposed in order to foster the kelp fisheries on the north east of Scotland from which a weak alkali was obtained. When, subsequently, trade had resumed its normal channel, the British soap industry found itself heavily handicapped by excessive duties on such articles as barilla, a crude soda-carbonate commonly brought from Spain or the Levant. When, as one of his first reforms, Thomson had secured a reduction of the duty on barilla, the Scottish landlords resented the fiscal change as fiercely as their English brethren did the suggestion of a reduction of the duty on corn. Such were the difficulties which the new president of the Board of Trade met with at every turn in his efforts to simplify and reform the complicated British fiscal system.

It was generally supposed, from the nature of the r relations, that Lord Althorp's first budget, brought down on February 11th, 1831, contained a good many features which originated with the new vice-president of the Board of Trade. At any rate he obtained full credit for every interference with vested interests which it contained, and received due castigation from the disappointed monopolists. The proposed reduction 011 the timber duties was thrown out on a combination of certain ship-owners and colonial investors with the Opposition and with a considerable element in the ministerial ranks, who felt that >f this were permitted to pass their turn might come next. Yet, when the Opposition came into power in 1841, their first budget contained a similar proposal, but though it shared the same fate it aided in preparing the way for the ultimate abolition of this very onerous preference granted by the Mother Country to the American colonies, and which in reality produced no corresponding advantage to the colonies, for it simply promoted the reckless and wasteful destruction of Canadian forests.

Poulett Thomson was now so completely absorbed in the intricate details pertaining to the financial and fiscal aspects of his office, that he took but little part in the great debates of 1831-2 on the Reform Bill. In this, however, as we have said, he was deeply interested, and two of his most intimate friends, Lord IAlthorp and Lord Durham, had a chief part in the framing of the bill.

He devoted special attention at this time to a commission appointed for the revision of the system of keeping the public accounts; of this Sir Henry Parnell was chairman, and his friend Dr. Bowring, the noted authority on financial matters, was secretary. As the result of their labours, the accounting of the British public offices was brought into harmony with the most approved methods of modern business. We shall find Lord Sydenham directing a similar and much needed revision in Canada.

In November, 1831, Mr. Poulett Thomson and Lord Durham went to Pans to follow up the previous informal discussions and to set on foot negotiations for a new commercial treaty with France. The joint commission named by the two governments consisted of Mr. George Villiers, afterwards Earl of Clarendon, and l)r. Bowring, representing England, and Messieurs Freville and Duchatel, representing France. The instructions for the British commissioners were drawn up by Poulett Thomson. There was not much difficulty, 011 the part of the commissioners, in arriving at a provisional agreement based 011 sound principles of international trade, but it was quite another matter to secure any actual alterations in the existing tariffs which might affect disadvantageously those interests which were at the time reaping profits at the public expense. The work of the commission continued at intervals until 1835, and though at the time only very limited concessions were secured, the way was prepared for much greater results later on.

In the course of his work at the Board of Trade, Poulett Thomson still found that on every hand he had to contend with special interests, domestic and colonial, which either stoutly resisted all attempts at reform, or, under reactionary influences, sought to restore anomalies which had been removed either Mr. Huskisson's time or his own. In 1832, notwithstanding objections to all innovations in the tariff, he introduced and piloted through parliament an important measure effecting an extensive consolidation of the excise duties. The energy with which he threw himself into such work, involving as it did an immense amount of detail, naturally told upon his constitution. An item from his journal will indicate how great the strain was. August 28th, Saturday.—"A week of the hardest possible labour. I have not returned from the House' any day till three o'clock; on Wednesday not till four. It is impossible to stand this! I find my body quite exhausted, and my mind equally worn out. All this week I have alternated between the Bank and Silk Committees, and then the House. On Wednesday I carried my Bill (the Customs Duties) through the Committee: was at it from five till two in the morning, nine mortal hours!.....I passed my Bill to-day, thank God!"

At the close of the session he made a tour through the manufacturing districts of the north of England and southwest of Scotland, acquiring a practical acquaintance with the typical industries of the country and the shipping centres of Glasgow and Liverpool.

The principles which he upheld in the House of ("ominous were so thoroughly appreciated by the electors of Manchester that he had been urged to offer himself as a candidate for that borough when first erected into an independent constituency as the result of the Reform Act. Though highly flattered by the proposals of his Manchester friends,

he doubted the wisdom of attempting to change his constituency. Hence, while expressing his high appreciation of the honour of representing such a borough, he declined to undertake the campaign, and once more declared himself a candidate for Dover. Even oil such terms his Manchester friends continued to prosecute their canvass; the result was, that while he was elected at the head of the poll in Dover, he was also returned by a large majority as one of the members for Manchester. As this expression of esteem and confidence came to him chiefly in virtue of his political principles and parliamentary services from a constituency representing one of the most enlightened and enterprising sections of England, he naturally esteemed it a signal honour. It was the more gratifying in that, owing to the peculiar composition of the House of Commons and the unsatisfactory state of parties, conscientious attention to the public interest and the details of office were but indifferently appreciated m most parts of the country outside a limited circle of enthusiasts. Though loath to break the ties which had been formed with many supporters in Dover, he could not but decide to accept Manchester. Its great importance as the chief manufacturing centre in Britain gave him just that added influence and weight n the House and in the cabinet which was needed to support the commercial and fiscal reforms for which he stood.

The borough of Manchester prepared to celebrate in fitting manner <ts new liberties and it$ new members. The speech of Mr. Poulett Thomson was worthy of the occasion. Undoubtedly the most vital issue before the country as a whole was the question as to how far the tide of reform which had been steadily rising for some years past was to be allowed to flow. Staunch Tories had consistently opposed it from the first, the more conservative Whigs, forming the chief body of the ministry under whose administration the Reform Act had been carried, had already said, "So far, but no farther," giving expression to their convictions in the famous "finality" dictum. On the other hand, the more doctrinaire Radicals, a steadily increasing element but with no very definite boundaries, saw opening before them an indefinite programme of democratic reforms, several of which appeared quite revolutionary to the more cautious statesmen of that day. It was the alarming programme of more reforms to follow which was chiefly responsible for the application of the "finality' brake by the Whigs who had passed the Reform Act.

It was this question of future reforms which the new member for Manchester frankly faced before his new costituency, which now heard him for the first time. He declined to accept either the Conservative or the Radical solution, but maintained that the correct policy was that of the open mind to sound ideas, and the open door for reasonable progress. But this, he held, implied ft careful testing, by reference to the actual needs of the time, of every step in the series of progressive measures. Taking up in detail the questions of his own department, he proceeded to give concrete illustrations of urgent reforms which were yet to be undertaken. In the forefront he naturally placed the need for a more liberal commercial policy. Referring to the opposition which his efforts had hitherto met with, he says, "I have been for years exposed to all the shafts which malice or ignorance could point against me for the devotion which I have ever shown to these principles." And what were these principles? "They are the most perfect freedom of exchange —a fair field for our industries —and no restrictions, beyond what for fiscal purposes are necessary, upon the exertions of our manufacturers." He then outlined in concrete shape the whole argument which was years afterwards to free the trade of Britain from its trammels, and enable her to lead the world for another half century. The following extract from his speech will quite fully indicate the principles which he advocated, and the manner in which he presented them.

"But, say the advocates of this admirable recipe for getting rich by Act of Parliament, protection is necessary to secure our industry from foreign competition. What are the effects it has produced in this respect in this country? You see it illustrated at home in a manner which cannot fail to have been present to every man's mind long ere this. Let me ask you what protection has been given to that great manufacture which gives employment to hundreds of thousands—nay, to miliums I may say —within the great district which encircles your city? What protection has the cotton trade had? I answer, none whatever! Unaided by any legislative enactment—unassisted by the fostering hand of power—unprotected by the custom-house book —this great manufacture has grown from an infant's condition until it has attained a giant's strength. We see it with one arm encircle the conquests of the New World, and with another shower its productions into the very heart of that country, the vast empire of India, which was formerly its successful rival, and extending and pushing forth the fruits of its industry even into the central regions of Africa, where no European foot was ever yet stamped. This, gentlemen, is the success which has attended a manufacture which was not the pet of the legislature. Let me now mark the course of another manufacture fenced round by protections of all kinds, equally a production of a foreign country—the raw material equally brought from a distance—arid thus affording a fit comparison with that which I have named. What was the case with silk? Was protection wanting there? Were there no laws which restricted foreign competition—were there no penalties upon those who attempted to introduce it? And did all this protection, amounting to absolute and total prohibition, tend to make this branch of industry flourish and extend itself? Under the auspices of the coast blockade and the search warrant did it realize the theories of the protectionists? Was it found that that manufacture, irivalling and outstripping all its competitors in foreign countries, obtained an extension like its poorer and unprotected, but therefore more hardy, brother? No such tiling—not only did it not attain the vigour which would enable it to reach foreign climes, but, in spite of your prohibitory laws—in spite of your penalties exacted from the unfortunate smuggler, it was met even in this country at every turn by its foreign competitors. In these two branches then, we may read the history of the fallacy of protection. My system, then, is this: Leave to industry a full and fair field—relieve us from your unwise protection— remove from us your well-meant but injudicious care—leave us alone, let our talent, our capital and our invention follow their free course, and what I see before me to-day removes, if I ever had, any doubt that we shall then have 110 rivals to fear, no competitors to dread. . . .

"I contend, and I have contended, that if we consent to take from foreign countries that which they produce, they must of necessity receive from us in payment our productions. They may raise up libraries of custom-house books—they may surround their territories with custom-house officers—they may fill their seas with cruisers—but, if we are to take anything from them, they must take from us in return. The principle, then, which I have advocated, is to follow out, straightforwardly, our own course, to remove the unnecessary restrictions and prohibitions from the productions of other countries, and to trust to one of two consequences resulting; either a sense of their own folly, winch will induce them to adopt a better system of legislation, or to that necessity which 1 contend must exist—if they wish to take advantage of us—that they should admit, somehow or other, what we can give them ill payment."

This will indicate how completely Poulett Thomson had worked out for himself the free trade policy which has long been familiar to England, but which at that time was regarded with so much patriotic apprehension by many ill-informed yet able and conscientious men, and with so much aversion by others who were actuated only by a narrow and persona] selfishness. In Manchester, however, these ideas were better understood and more intelligently appreciated, and, as their member was free to confess, "the confidence which you, the electors of this great metropolis of the manufacturing industry of the world, have reposed in me, unsought and unsolicited,—an honour which I never hoped to obtain, and which I should never have sought to achieve, —is indeed the most convincing and irresistible answer to attacks of that description."

The strenuous nature of the welcome which his new constituents extended to him may be inferred from the following entry in his journal.

Sunday night, December 30th, 1832.—"Tins has been a week of prodigious excitement, and I have had no time to set down one word. Monday at the Exchange. Tuesday, Christmas Day, quiet. Thursday, the dinner, the proudest day of my life, 1,250 people sat down, Hey wood m the chair. I spoke an hour and a half, and, I think, well. Friday dined at Heywood's, and Saturday night left for town, very ill. To-day sent for Copeland."

It may be inferred that after the election of 1832 Poulett Thomson did not relax his efforts in the House of Commons or in the cabinet towards promoting tariff reform. While eloquently advocating the larger features of tariff reform such as the reduction and final abolition of the Corn Laws, the relief of sugar, timber, wool and cotton, which required, however, for their ultimate acceptance a long course of education, he went on with the work of classifying and simplifying the duties, relieving where possible the burdens on minor articles which while contributing little to the revenue distressed both manufacturer and consumer by the exorbitant rates which were levied. These reforms were managed with a quiet, tact which escaped the notice at once of his organized opponents and of the public at large. Thus, under cover of the general educational campaign for freedom of trade on a large scale, between 1832 and 1830, the president of the Board of Trade had secured reductions of duty, some of them of very considerable percentages, on three hundred and seventy-two articles, and had greatly simplified the duties on many others. I he same system and the same principles were followed by Sir Robert Peel and. Mr. Gladstone in preparing for their larger measures at a later date.

A subject to which he naturally gave special attention, and on which his experience was to be called into requisition in Canada, was that of banking. On this subject he held very definite views, the views afterwards embodied by S>r Robert Peel n the Bank Act of 184-4, which introduced the system still regulating banking in Britain. The essent'al feature of the system, as regards the issue of paper money, is that the paper currency of the country should be issued by a single national bank, solely against bullion, and would therefore fluctuate with the amount of bullion in the country. A certain permanent nucleus of the reserve might be held in government securities, which would not, however, affect the large margin of bullion, upon the ebb and flow of which the note issue of the country would depend. For a country situated as England, at the centre of the world's financial and exchange business, such a system has proved on the whole very satisfactory. The practical experience and economic arguments with which Poulett Thomson supported his views, which were shared by the best financiers of the tune, were amply justified in subsequent British history. As to whether such a system was quite as fully applicable to the condition of a colony such as Canada in 1811, we shall have to consider later.

To Poulett Thomson's lot also fell the duty of superintending the passing of the Act for regulating the labour of children in factories, and its subsequent administration by the commission appointed to carry it out. At the close of the session of 1833, he sought a rest in a tour of the Rhine, and spent the month of October at Paris endeavouring to forward the negotiations for a commercial treaty.

During the following session of 1834, the Corn Law question was again much in evidence. The able and indefatigable member for Middlesex, Mr. Joseph Hume, brought on his long-expected motion on the subject. Not content with the sliding-scale system of duties adopted in 1828, he urged a still further reduction to a moderate fixed duty. Mr. Poulett Thomson naturally came to the aid of the free trade forces, and on the 7th of March delivered one of his most important speeches m parliament. As yet those opposed to the Corn Laws were decidedly in the minority in the House of Commons, even on the side of the Whig party.

Hence, in supporting Mr. Hume's motion, Poulett Thomson as a member of the government, though not yet in the cabinet, was in opposition to the majority of his colleagues, an opposition which was most pronounced in the case of Sir James Graham, First Lord of the Admiralty, to whose arguments in support of the sliding scale he devoted some strong, though respectful, criticism. The fact was that Sir James Graham had not been for some time oil the best of terms with the majority of the cabinet, though one of the most advanced advocates of the Reform Act, and indeed a member of the small committee which drafted it. Though not in sympathy with the more extreme form of the Corn Laws, he was not as yet prepared to accept any serious lowering of the duties on grain. Yet he wras destined some twelve years later to be Peel's most advanced supporter in securing the complete abolition of the Corn Laws. At present his chief difficulty with his Whig colleagues was over the question of the Irish Church, he being an uncompromising supporter of the Establishment. This friction in the cabinet foreshadowed the readjustment which was soon to take place, and which was to relieve it. of its most Conservative element.

In the main body of his speech in support of Mr. Hume's motion, Poulett Thomson passed in review the actual history of the Corn Laws from the beginning of the existing system in 1815, pointing out that it had been a burden upon the public while ail unsteady and delusive favour to the farmer. He maintained that the strength of Britain lay in her manufacturing industries, which should be encouraged by the double process of fostering trade with other countries by purchasing their produce, which in turn would encourage the purchase of British wares instead of forcing foreigners to prematurely attempt manufacturing for themselves because they could find no market for their own produce. This was indeed the situation which became so effective some years later in the United States as the justification for building up a protective system there. As usual he did not argue his case upon merely abstract principles assumed to be applicable to all countries in the world. He dealt with the actual condition of Britain itself, which, however, he treated in no narrow manner, but in a broad and comprehensive spirit. There were, it is true, many ardent free-traders who insisted upon generalizing the British conditions in such fashion as to conclude that the trade policy which was most suitable for Britain must be equally suitable for all other countries, and that therefore the adoption of free trade in Britain might be expected to be followed by its adoption m all other countries. Though Poulett Thomson hoped to see the trade of the world much freer than it then was, he nevertheless regarded as the best for Britain the freedom of trade which he advocated, whatever policy other countries might adopt. It s one of the circumstances most flattering to the fulness and accuracy of his knowledge and the soundness of the judgments which he founded upon it, that nearly all of the practical principles which he maintained, and the features of political policy which he advocated, have been fully realized in the course of British development. Yet, in advocating most of the features of his trade policy and financial reforms, he was considerably in advance of his colleagues, and, as we have seen, frequently in opposition to them, where the question was permitted, as in the case of the Corn Laws, to be treated as an open one. But though thus closely in line with so many great features of policy which were ultimately to prevail, his early death prevented his seeing any of them finally accepted.

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