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APPENDIX II.

The question really is, Will Canada agree to reciprocate
 to any extent beyond the present tariff preference?
Not while Protectionist opinion rules in our
councils.
(B.)—I presume this question only refers to manufactured
 goods, and not to raw material or foreign foodstuffs,
 such as tropical or sub-tropical products.
In the case of manufactured goods where other
European countries and the United States are the
competitors with Great Britain for the supply of
Canada, every item is a fair subject for discussion,
and, if Great Britain will actually make the goods we
want, which is often the main difficulty, we should be
willing in the main to raise the duty against outside
nations, where necessary, in order to give Great
Britain the trade. Clearly, however, this is a matter
which must be dealt with in detail, because there may
be classes of manufacture where even if we raised the
duty against outside nations, Great Britain, with the
preference, cannot secure the trade because of faults
inherent in the manufacturing conditions existing in
Great Britain in that particular trade.
(C.)—I do not think so; at least the consumers of
those imports would not agree readily to pay the
increased price,
(C1.)—The effect will be—
(a) Dissatisfaction,
(b) Probably baneful.
(D.y—It is conceivable that Canada might increase
such duties—that would depend entirely on whether
her Parliament thought such increase would pay.
The effect could not be appreciated before the situation
was disclosed precisely. Canadians are not devoted to
theories—they are apt to look hard at circumstances,
and judge what will pay when circumstances are clearly
seen.
(D1.)—1I really feel quite incompetent to say what
Canada would do if questions or proposals to which