> 
of ‘goods in the Commonwealth. For many years the cost of 
production generally has been increasing, and unfortunately 
these increases appear to have been maintained. 
“ If Australia were entirely isolated from oversea sources of 
supply and independent of them, and if it were also inde- 
pendent of overseas markets for the disposal of some of its 
products, high cost of production would matter less to its 
people. Seeing, however, that Australia is not isolated and 
is dependent to a large degree upon overseas markets, the 
seriousness of the position lies in the fact that the cost of 
production in competing countries has declined while costs in 
Australia generally have risen—thus increasing the already 
wide margin of difference between the costs in overseas 
countries and those in Australia.” 
48. The Customs duties are not all definitely fixed by statute. 
They are elastic in that they may be increased to prevent dumping, 
and within the limited range of deferred duties may be imposed 
suddenly by administrative action. We do not say that the powers 
thus entrusted to the Government have been capriciously used, but 
there is a danger that in imprudent hands they might be so used; 
and if they were trade would be seriously hampered. What 
virtually amount to administrative additions to Customs duties 
through special preferences given by authorities undertaking public 
works to the products first of their own and next of other States 
as against imported products, even though the latter when charged 
with the duties prescribed by the tariff may still be cheaper, 
are gravely to be deprecated. Action in this direction is in effect 
an arrogation of powers which by the constitution are entrusted 
to the Legislature and Government of the Commonwealth. 
49. We realize that the objects of a protective tariff are not 
surely economic, and that a protective policy may be adopted, in 
part at least, on other grounds. A young nation may feel that it 
1s due to herself to have a proper share of that diversity of occupa- 
tions and industries which characterizes the older peoples of the 
world, and that her national life would be one-sided and even 
starved without it; and she may feel that from the point of view 
of the dangers to which she may be exposed in case of war she 
cannot afford the risk of being deprived of essential commodities by 
Interruption of oversea communications, or, if the war be one in 
which she is herself engaged, of being without the industries 
Indispensable for the production of armaments. She may be 
Prepared to pay for these objects through economic sacrifice; but 
if this be necessary it is important that she should make the 
sacrifice with her eyes open and be ready to count the cost. 
50. It is with the economic aspect of the protective tariff, there- 
fore, that we are mainly concerned, and not with any abstract 
controversy on the respective merits of protection as such and of 
the rival svstem of free trade. We recognize that protection is 
Alteration of 
luties by 
administra- 
tive action. 
Objects of a 
protective 
tariff. 
[ts economic 
aspect.