t also as that from which its resigning free-trade members had dissented;
and the country was puzzled by a statement from Lord George Hamilton that
Mr Balfour had circulated among his colleagues a second and different
document, in fuller agreement with Mr Chamberlain. The situation was
confused by personal suspicion and distrust as well as by economic
difficulties. But the public noted that the duke of Devonshire, whose
orthodoxy was considered typical, remained in the cabinet.

The crisis, however, soon developed further, owing to explanations between
the free-trade Unionists. On October 1st Mr Balfour spoke at Sheffield,
reiterating his views as to free-trade and retaliation, insisting that he
"intended to lead," and declaring that he was prepared at all events to
reverse the traditional fiscal policy by doing away with the axiom that
import duties should only be levied for revenue purposes. The speech was
enthusiastically received by the National Union of Conservative
Associations, who had year by year flirted with protectionist resolutions,
and who were known to be predominantly in sympathy with Mr Chamberlain. But
the free-traders did not like Mr Balfour's formula as to reversing the
traditional [v.03 p.0253] fiscal policy of import taxes for revenue only.
Next day the duke of Devonshire resigned, a step somewhat bitterly resented
by Mr Balfour, who clearly thought that his sacrifices in order to
conciliate the duke had now been made in vain. During this critical
fortnight the duke had apparently acquiesced in Mr Balfour's compromise,
and had co-operated in reconstituting the ministry; his nephew and heir had
been made financial secretary to the treasury, while Mr Alfred Lyttelton
was appointed colonial secretary, Mr Austen Chamberlain chancellor of the
exchequer, Mr Brodrick secretary for India, Mr H. O. Arnold-Forster war
minister, Lord Stanley postmaster-general and Mr Graham Murray secretary
for Scotland. Lord Londonderry now became president of the council, Lord
Lansdowne leader of the House of Lords, and Lord Salisbury, son of the late
premier, who as Lord Cranborne had for three years been under-secretary for
foreign affairs, was included in the cabinet as lord privy seal.

During the remainder of 1903 the struggle within the Unionist party
continued. Mr Chamberlain spoke all over the country, advocating a definite
scheme for reorganizing the budget, so as to have more taxes on imports,
including food, but pr