enlisting a number of influential material interests in the cause of
peace, tends to ameliorate those relations and thus, _pro tanto_, to
diminish the probability of war. No nation has, of course, the least
right to dictate the fiscal policy of its neighbours, neither has it any
legitimate cause to complain when its neighbours exercise their
unquestionable right to make whatever fiscal arrangements they consider
conducive to their own interests. But the real and ostensible causes of
war are not always identical. When once irritation begins to rankle, and
rival interests clash to an excessive degree, the guns are apt to go off
by themselves, and an adroit diplomacy may confidently be trusted to
discover some plausible pretext for their explosion.

In a speech which I made in London some three years ago, I gave an
example, gathered from facts with which I was intimately acquainted, of
the pacifying influence exerted by adopting a policy of Free Trade in
the execution of a policy of expansion. I may as well repeat it now.
Some twelve years ago the British flag was hoisted in the Soudan side by
side with the Egyptian. Europe tacitly acquiesced. Why did it do so? It
was because a clause was introduced into the Anglo-Egyptian Convention
of 1899, under which no trade preference was to be accorded to any
nation. All were placed on a footing of perfect equality. Indeed, the
whole fiscal policy adopted in Egypt since the British occupation in
1883 has been based on distinctly Free Trade principles. Indirect taxes
have been, in some instances, reduced. Those that remain in force are
imposed, not for protective, but for revenue purposes, whilst in one
important instance--that of cotton goods--an excise duty has been
imposed, in order to avoid the risk of customs duties acting
protectively.

Free Trade mitigates, though it is powerless to remove, international