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taken by a “movement" and find that in all its turns it subserves the actual interests of certain groups or classes of men, we are justified in concluding that these interests constitute the real motive of the movement.
In that sense, and in that sense alone, does Protection rank as one of the aggressive and defensive policies of a proprietary class or group of classes seeking to make positive gains for themselves out of the loss of their fellow-citizens and to defend against popular assaults the economic and political powers which enable them to make these gains.
PROTECTION AND SOCIALISM
exchange of commodities or services takes place, either between members of the same nation or members of different nations, discloses the absence of that complete equality of economic opportunity essential to full freedom of exchange. Obstacles to mobility of the factors of production are everywhere forming bases of scarcity" values which sometimes change the structure of a competitive market into a qualified or an absolute monopoly. The superior bargaining power thus vested in certain buyers or sellers is liable to become so oppressive and injurious either to the general public or to some class as to evoke legislative interference in restraint of “free” contracts between parties so unequally equipped. Poverty or ignorance may deprive a person of true liberty of contract; he may not know the nature of the bargain he enters, or knowing it he may be unable to refuse to enter
it; or else the contract may be made for him to his detriment by a parent or other person claiming to act on his behalf; or finally, the contract, though entered with equal liberty and knowledge by both parties, may be so injurious to the family or to other members of society as to be adjudged contrary to public policy.
These are some grounds upon which legislative interference with freedom of economic contract has taken place in civilised communities. All such legislation may be regarded as "protective” and as involving a formal restraint of “free exchange." In most instances the "freedom” which is interfered with is unsubstantial. The coercion and protection of factory, public health, and other legislative interference with “ freedom” of the sale of labourpower is a recognition of the inability of workers in many industries to bargain effectively regarding hours of labour, sanitation, security against accidents, etc., with their employers. In the case of children and many young persons there can be no serious pretence that they are “free agents.” In the case of many classes of adult workers, especially women, the limitations of their choice with regard to kind and terms of employment are such as leave them little real liberty ; they must effect a continuous sale of the only thing they have to offer in exchange, their labour-power; they must sell in a particular locality upon terms regarding price, hours, etc.,
which, as individuals, they are powerless to modify and cannot reject. The largest infringement of a pure policy of laissez-faire in the determination of sales consists in this regulation of the sale of labourpower. Drastic measures of "protection” are enforced in connection with the sale of professional services, designed partly to secure "fair remuneration” for the profession, partly to protect the "consumer," whose "liberty” in buying professional services is impaired by necessary ignorance. Partly, again, as a protection of the consumer, partly as an act of public policy, certain material commodities are removed from a "free market" and can be sold only in licensed places or by licensed persons under rigorous conditions : alcoholic liquor and drugs are chief instances. Various laws protect the consumer against poisonous or adulterated articles; others deal with misdescription of kind, quality, or origin.
$2. This legislative interference, though chiefly directed to processes of production, involves a considerable restraint of “freedom of exchange" in internal trade. To some the regulation of external trade appears a natural extension or corollary of this regulation of internal trade. Certain contracts or other bargains are removed from the legitimate area of “ free exchange" in domestic trade, may not certain bargains be similarly restrained in foreign trade?
The issue is sometimes put from the standpoint of capital claiming "protection” against foreign com
petition as a counter-weight to the “protection afforded to labour by factory acts and other "social” legislation. The effect of this legislative “protection” of labour, it is urged, is to raise the expenses of production in this country as compared with other countries, and so to expose our markets to the invasion of foreign goods which can undersell our goods, because they are produced without such expensive restrictions.
The “labour" in trades closely pressed by foreign competition sometimes, identifying its cause with that of “capital,” presses the same argument, protesting against the goods it produces being undersold by the products of “sweated" labour abroad. Why,” it is asked, "should we permit our trades to be thus handicapped in our own markets; surely we ought to impose the same restraints on foreign goods which we impose upon our own goods? You try to stop Germans from producing ‘sweated' clothes in London and selling them, why allow them to make the same clothes in Hamburg and send them over to sell at the same price in our market?"
It is not always clearly seen that these cases involve the entire policy of free imports. Are we to stop the entrance of German hardware, which may be able to undersell our goods, on account of the low wages and long hours of German labour, while we continue to give free admission to American hardware which may undersell our goods by reason