When, after the failure of Free Trade, Bismarck returned to a policy of Protection for Germany, he found that the shipbuilding capabilities so necessary for her all-round industrial development, were severely handicapped by the cost of transporting the coal and iron required, over the long distances intervening between her mining centres and her shipbuilding yards on the coasts and along the harbours of her great rivers. To remedy this, the State first got control of the railways, and then reduced freights to so low a point, that it put the German industry of shipbuilding more nearly on an equality with that of England, - so far at least as the cost of transport of the raw materials from the mines and manufactories to the shipbuilding yards was concerned. But still it was generally believed that the obstacles to the development of a shipping industry were insuperable, owing to the disadvantage of her narrow seaboard, the fewness of her natural harbours, and the preponderating power of English shipbuilding, which had gathered into its hands almost the entire German shipping trade.

But the German Government, undeterred by difficulties when once the end was clearly in view, set to work - with that deliberation, thoroughness, caution, and determination, which are so characteristic of the people - to remedy this defect; and resolved that as the nation had been born without a natural limb, an artificial one would have to be found to take its place. And accordingly having the control of the railways and the tariff in its own hands, the Government began by admitting all the materials necessary for its nascent shipbuilding free of duty, but as the manufacturers still found it much more to their advantage to employ English shippers than their own, the Government was obliged to devise means by which the manufacturers, the ship-builders, and the shipping merchants should all be forced to play into each others' hands, and not into those of the foreigner. And accordingly we find it giving its orders for warships only to German ship-builders; while it made its subsidies to passenger liners dependent on their employing home materials in the construction of their boats; the upshot of it all being, that both the shipbuilding and the shipping trades, which could no more have taken root in Germany in the face of the great supremacy of England in both these departments than they could on some coral reef in the Southern Seas, were enabled by the combined powers of Protection on the one hand, and of a control of Industry by the Government sufficient to bring individual recalcitrant traders into line on the other, to step forth in less than a single generation from their birth, and to contest the supremacy even of England herself in a large section of that shipping industry which she had made peculiarly her own, but which had taken her centuries to build up.

And the moral of it all, for all economists and all nations, is obvious, namely, firstly, to protect each its own instruments of production as assiduously as it already abstains from taxing them; and secondly, that each Government should be armed with the full power of doing this, and (now that the age of Industry has fully come) of doing it as thoroughly and effectually as it does in war.

And lastly, that so long as the present capitalist form of the industrial regime lasts, the great body of genuine working men being prevented by that regime from all access to, or control over, the national instruments of production, have a right to demand that these instruments shall be completely protected, and not sacrificed, as Free Trade aims always at doing, to the interests of the consumer as such, and especially to the lowest and most unskilled members of the community, - the great proletariat of industrial ineffectuals who must be dealt with as subjects of political administration, but can no more be made the basis of the political economy of a nation, than the camp followers, or even the wounded, can be made the basis of a campaign in war, however much they may have to be studied or provided for as collateral considerations. For when divorced from the instruments of production of a nation, the mere consumer, as such, of whatever rank, or profession, or employment he may be, is as we have already seen the veriest sac or barnacle, 'eating his head off'; and that the State should deliberately set to work to organize itself on his interests (and that is what Free Trade not only essentially means but openly avows) and especially when, driven to it by its own logic, it would organize itself in the interests of the lowest degenerates - the incapable, the drunken, the 'work shys' and the slum-dwellers generally - while at the same time it is content to sit still and see one instrument of production after another carried off by foreign rivals without a sigh or an effort made to save them, but with a 'God speed' rather, - and that too on the curious ground that there are always plenty of other industries ready to spring up in their place; - all this is an attempt to make the pyramid of State stand on its apex rather than on its base, and is to reverse all the lessons and teachings of Nature, of History, of Civilization, and of Human Life. But it may be objected that the genuine working men themselves do not agree with me in this, but believe, on the contrary, as is shown by their votes in support of Free Trade, that their interests as producers, as well as consumers, are better subserved by Free Trade than by Protection. To which I can only reply, that in my judgment three fourths of the considerations which have confirmed them in this opinion are drawn from the orthodox Political Economy, and from the economic practice and tradition of the particular country in which they have been born and brought up; and that my object in writing this book is to supplant this old Ptolemaic system of Political Economy by a new Copernican one, and as far as possible help to neutralize the weight which still attaches (in England alone of nations), to the old economic traditions of Free Trade which are bound up with that system.