The question of self-government is closely associated with the question of self-support. Plenty of good land and the liberty to manage their own affairs were the causes assigned by Adam Smith for the marked prosperity of the British colonies towards the end of the 18th century. The same causes are still observed to produce the same effects, and it may be pointed out that, since the date of the latest of Adam Smith's writings, upwards of 6,000,000 sq. m. of virgin soil, rich with possibilities of agricultural, pastoral and mineral wealth, have been added to the empire. In the same period the white population has grown from about 12,000,000 to 53,000,000, and the developments of agricultural and industrial machinery have multiplied, almost beyond computation, the powers of productive labour.
It is scarcely possible within this article to deal with so widely varied a subject as that of the productions and industry of the The imperial factor in industry and trade. empire. For the purposes of a general statement, it is interesting to observe that concurrently with the acquisition of the vast continental areas during the 19th century, the progress of industrial science in application to means of transport and communication brought about a revolution of the most radical character in the accepted laws of economic development. Railways did away with the old law that the spread of civilization is necessarily governed by facilities for water carriage and is consequently confined to river valleys and sea-shores. Steam and electricity opened to industry the interior of continents previously regarded as unapproachable. The resources of these vast inland spaces which have lain untouched since history began became available to individual enterprise, and over a great portion of the earth's surface were brought within the possessions of the British empire. The production of raw material within the empire increased at a rate which can only be appreciated by a careful study of figures, and by a comparison of the total of these figures with the total figures of the world.
The tropical and temperate possessions of the empire include every field of production which can be required for the use of man. There is no main staple of human food which is not grown; there is no material of textile industry which is not produced. The British empire gives occupation to more than one-third of the persons employed in mining and quarrying in the world. It may be interesting, as an indication of the relative position in this respect of the British empire to the world, to state that at present it produces one-third of the coal supply of the world, one-sixth of the wheat supply, and very nearly two-thirds of the gold supply. But while these figures may be taken as in themselves satisfactory, it is far more important to remember that as yet the potential resources of the new lands opened to enterprise have been barely conceived, and their wealth has been little more than scratched. Population as yet has been only very sparsely sprinkled over the surface of many of the areas most suitable for white settlement.
In the wheat lands of Canada, the pastoral country of Australasia, and the mineral fields of South Africa and western Canada alone, the undeveloped resources are such as to ensure employment to the labour and satisfaction to the needs of at least as many millions as they now contain thousands of the British race. In respect of this promise of the future the position of the British empire is unique.
It is not too much to say that trade has been at once the most active cause of expansion and the most potent bond of union in the development of the empire. Trade with the tropical and settlement in the temperate regions of the world formed the basis upon which the foundations of the empire were laid. Trading companies founded most of the American and West Indian colonies; a trading company won India; a trading company colonized the north-western districts of Canada; commercial wars during the greater part of the 18th century established the British command of the sea, which rendered the settlement of Australasia possible. The same wars gave Great Britain South Africa, and chartered companies in the 19th century carried the British flag into the interior of the African continent from south and east and west. Trading companies developed Borneo and Fiji. The bonds of prosperous trade have kept the Australasian colonies within the empire. The protection of colonial commerce by the imperial navy is one of the strongest of material links which connect the crown with the outlying possessions of the empire.
The trade of the empire, like the other developments of imperial public life, has been profoundly influenced by the variety of Imperial trade policy. local conditions under which it has flourished. In the early settlement of the North American colonies their trade was left practically free; but by the famous Navigation Act of 1660 the importation and exportation of goods from British colonies were restricted to British ships, of which the master and three-fourths of the mariners were English. This act, of which the intention was to encourage British shipping and to keep the monopoly of British colonial trade for the benefit of British merchants, was followed by many others of a similar nature up to the time of the repeal of the Corn Laws in 1846 and the introduction of free trade into Great Britain. The Navigation Acts were repealed in 1849. Thus for very nearly two hundred years British trade was subject to restrictions, of which the avowed intention was to curtail the commercial intercourse of the empire with the world. During this period the commercial or mercantile system, of which the fallacies were exposed by the economists of the latter half of the 18th century, continued to govern the principles of British trade.
Under this system monopolies were common, and among them few were more important than that of the East India Company. In 1813 the trade of India was, however, thrown open to competition, and in 1846, after the introduction of free trade at home, the principal British colonies which had not yet at that date received the grant of responsible government were specially empowered to abolish differential duties upon foreign trade. A first result of the commercial emancipation of the colonies was the not altogether unnatural rise in the manufacturing centres of the political school known as the Manchester school, which was disposed to question the value to Great Britain of the retention of colonies which were no longer bound to give her the monopoly of their commercial markets. An equally natural desire on the part of the larger colonies to profit by the opportunity which was opened to them of establishing local manufactures of their own, combined with the convenience in new countries of using the customs as an instrument of taxation, led to something like a reciprocal feeling of resentment, and there followed a period during which the policy of Great Britain was to show no consideration for colonial trade, and the policy of the principal colonies was to impose heavy duties upon British trade.