Chapter IV

Higher still, and higher far than anything the nation has ever yet known, must go the cost of living under the new tariff law. From a British textile representative I learned the other day that a grade of English woollens largely used by the Japanese for underwear will cost over one third more under the new tariff, while the increased duty on certain other lines of goods is indicated by the table herewith:

PERCENTAGE OF DUTY TO COST OF ARTICLE

Old Tariff New Tariff

Printed goods 3 22

White lawns 10 47

Shirtings 10 39

Cotton Italians 3 35

Poplins 8 19

Brocades 10 22

Neither a nation nor an individual can lift itself by its bootstraps. The majority of the thoughtful people in the empire seem to me to realize even now that through the new tariff Japanese industry, as a whole, is likely to lose much more by lessened ability to compete in foreign markets than it will gain by shackled competition in the home markets. Farseeing old Count Okuma, once Premier, and one of the empire's Elder Statesmen, seemed to realize this more fully than any other man I have seen. "Within two or three years from the time the new law goes into force," he declared, "I am {45} confident that its injurious effects will be so apparent that the people will force its repeal. With our heavy taxes the margin of wages left for comfort is already small, and with the cost of living further increased by the new tariff, wages must inevitably advance. This will increase the cost of our manufactured products, now exported mostly to China, India, and other countries requiring cheap or low-grade goods, and where we must face the competition of the foremost industrial nations of the world. As our cost of production increases, our competition with Europe will become steadily more difficult and a decrease in our exports will surely follow. It is folly for one small island to try to produce everything it needs. The tariff on iron, for example, can only hamper every new industry by increasing the cost of machinery, and must especially hinder navigation and shipbuilding, in which we have made such progress." Not a few of the country's foremost vernacular dailies are as outspoken as Count Okuma on this point, and the Kobe _Chronicle_ declares that, with diminished exports to Japan, "British manufacturers will find compensation in the lessened ability of the Japanese to compete in China; and Japan will find that she has raised prices against herself and damaged her own efficiency."

That such will be the net result of Japan's new policy seems to me to admit of no question. Unfortunately, certain special lines of British and American manufacture may suffer, but, on the whole, what the white man's trade loses in Japan will be recompensed for in China and India. Even after Japan's adoption of the moderately protective tariff of 1899 her export of yarns to China--in the much discussed "market right at her doors"--dropped from a product of 340,000 bales to a recent average of 250,000 bales. From 1899 to 1908, according to the latest published government figures, the number of employees in Japanese cotton factories increased only 240--one third of 1 per cent.--or from 73,985 to 74,225, to be exact, while I have already alluded to the figures showing the {46} comparative English and Japanese imports of raw cotton from 1890 to 1909 as furnished me by Mr. Robert Young, of Kobe, Japan in this period going from $30,000,000 to $54,000,000, or 77 per cent., while England's advance was from $135,000,000 to $300,000,000, or 122 per cent. The increase in England's case, of course, was largely, and in Japan's case almost wholly, due to the increased price of the cotton itself, but the figures are none the less useful for the purposes of comparison.

In the frequent attempts of the Japanese Government to stimulate special industries by subsidies and special privileges there is, it seems to me, equally as little danger to the trade of Europe and America in general (though here, too, special industries may suffer now and then), because Japan is in this way simply handicapping herself for effective industrial growth. Just at this writing we have an illustration in the case of the Formosan sugar subsidy which seems to have developed into a veritable Frankenstein; or, to use a homelier figure, the government seems to be in the position of the man who had the bear by the tail, with equal danger in holding on or letting go. Already, as a result of the system of subsidies, bounties and special privileges, individual initiative has been discouraged, a dangerous and corrupting alliance of government with business developed, public morals debased (as was strikingly brought out in the Dai Nippon sugar scandal), and the people, as Mr. Sasano, of the Foreign Department, complains, now "rely on the help of the government on all occasions." On the same point the Tokyo _Keizai_ declares that "the habit of looking to the government for assistance in all and everything, oblivious of independent enterprise . . . has now grown to the chronic stage, and unless it is cured the health and vitality of the nation will ultimately be sapped and undermined."

As for increasing complaints of "low commercial morality" brought against Japanese merchants, that is not a matter of concern in this discussion, except in so far as it may prove a form of Japanese commercial suicide. But to one who holds {47} the view, as I do, that the community of nations is enriched by every worthy industrial and moral advance on the part of any nation, it is gratifying to find the general alarm over the present undoubtedly serious conditions, and it is to be hoped that the efforts of the authorities will result in an early change to better methods.