After travel and transport has been made absolutely free on land throughout the length and breadth of Great Britain, the free travel and transport principle will of course be extended to travel and transport by sea, and free travel and transport by sea will better bind the Empire together than a Pan-Britannic Customs Union. The most scientific body of British Socialists, the Fabian Society, says: "A logical consequence of the national management of internal means of communication will be the completion of the State control of our oversea transit. It is impossible here to go into details. Let it suffice to remark that already the nation has a direct financial interest in the great steamship lines, through its mail subsidies and Admiralty loans with corresponding claims for service in war; that intellectually the nation, by its pride in its magnificent mercantile fleet, regards it as a national possession, and declines to consider our shipping as the mere private property of the shareholders of the steamship companies; and finally, that our navy is maintained at enormous public expense expressly to protect the mercantile fleet, which at present is mainly private property."[748] "The notion that the forces making for disintegration can be neutralised by 10 per cent. preferential duties is not worth discussing; indeed, the raising of the fiscal question seems at least as likely to reveal our commercial antagonisms as our community of interests. And the huge distances will be mighty forces on the side of disintegration unless we abolish them. Well, why not abolish them? Distances are now counted in days, not in miles. The Atlantic Ocean is as wide as it was in 1870; but the United States are four days nearer than they were then. Commercially, however, distance is mainly a matter of freightage. Now it is as possible to abolish ocean freightage as it was to make Waterloo Bridge toll-free, or establish the Woolwich free ferry. It is already worth our while to give Canada the use of the British Navy for nothing. Why not give her the use of the mercantile marine for nothing instead of taxing bread to give her a preference? Or, if that is too much, why not offer her special rates? It is really only a question of ocean road making. A national mercantile fleet plying between the provinces of the Empire, and carrying Empire goods and passengers either free or at charges far enough below cost to bring Australasia and Canada commercially nearer to England than to the Continent, would form a link with the mother-country which once brought fully into use could never be snapped without causing a commercial crisis in every province."[749]
The purchase of the whole British mercantile marine by the Government would incidentally have the effect of abolishing the British shipping rings, which, like the British railways, frequently penalise with discriminating rates the British producer and shipper. "Of the real conditions of ocean traffic, at present, the public has no suspicion. All our lines of communication are controlled by shipping rings which carry preferential rating (an illegal practice in our inland transit) to an extent that would shock Mr. Chamberlain back again to Free Trade if he realised it; for their preferences are by no means patriotic; they have helped Belgium into our Indian market, and Germany and America into South Africa and New Zealand. The cotton conference of Liverpool directly assisted the American exporters of cotton to China by the heavy charges they made against the Lancashire manufacturer—charges which were modified only after repeated protests. These rings and rates constitute the most dangerous disintegrating force we have to face."[750]
There is much justification in the complaints of the Socialists with regard to British railways and shipping, but their proposals are, as usual, quite Utopian. For all ills of the body politic and economic, the Socialists have only one remedy, and that an infallible one—nationalisation, or rather Socialisation.
The policy of the British railway and shipping rings is no doubt a national scandal, but their defects and delinquencies may no doubt be counteracted by appropriate Government action and legislation. It is probably now too late for the State to acquire the railways. The State cannot afford to risk a large capital loss. Railway purchase would apparently be too speculative an undertaking.
If the State should acquire the railways, they would certainly be run at a profit. The sooner the Socialists abandon their fixed idea that profit on private and national undertakings is immoral, the better will it be for them. So long as they decry profit and propose to work State undertakings without a profit, so long can they not be taken seriously. Profit consists in part of the salary of direction, in part of the earnings set aside for effecting the necessary alterations, improvements, and extensions, and for forming a reserve fund for making losses good, &c. Therefore abandonment of profit would mean the decline and decay of the national capital.
FOOTNOTES:
[729] Davidson, Free Trade v. Fettered Transport, p. 9.
[730] Ibid. p. 7.
[731] Reformers' Year Book, 1907, pp. 119, 120.