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to reduce the real wages and costs of production in her industries. The folly of this operation is now generally recognised. But it is proper to dwell not upon the special features of the present case, but upon the fact that the problem of the immediate utility of wage reductions belongs to the general problem of cyclical depressions.

It is the greatest single peril to the progress of the working-classes in the higher-waged industrial countries. In periods of trade depression and restricted world-markets it may appear to peoples in these developed countries better to take lower wages than to support large bodies of unemployed workers out of currently reduced resources, just as we have seen that in these same conditions it appears advantageous to keep out by protective tariffs cheaper foreign goods that seek to enter our home markets and enlarge our unemployment. In fact, these two policies of lower wages and protective tariffs are partly complementary and partly alternative remedies against the disease of trade depressions. By keeping out foreign goods entering our markets at prices lower than those at which we can produce, we may relieve ourselves from the necessity of lowering our wages to meet this competition. This, of course, is the familiar and plausible plea for working-class support for protection, which has a short range efficacy similar to that appertaining to the policy of wage reduction. By lowering wages we enable our home trades immediately to expand (with the qualifications recognised above) and improve our export trade by securing an increased proportion of the restricted market. But our indus-