Propositions Concerning Protection and Free Trade by Willard Phillips
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Title:Propositions concerning protection and free trade.

Author:Phillips, Willard, 1784-1873.

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Print Source:Propositions concerning protection and free trade.

Phillips, Willard, 1784-1873.

xv, 233 p. 17 cm.

Boston,

C. C. Little and J. Brown,

1850.

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.. >. god PROPOSITIONS PROTECTION AND FREE TRADE. BY WILLARD PJIILLIPS. B

O STO N: CHARLES C. LITTLE AND JAMES BROWN. 1850. 6 CONCERNING ~, c. e e:.

I - e

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Entered accordig-to-ct of Congress, in the year 1850, by . Ad b.A R D PH

IL L I PS, In the Clerk’s Office of the District Court of the District of Massachusetts. BOSTON: PRINTED BY WILLIAM CHADWICK, EXCHA NG2 STaET.

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C 2r PREFAC.E. AMONG the many important inquiries relating to the social condition of men, which now occupy contemplative thinkers, as well as practical statesmen, both in Europe and this country, that concerning protection and free trade is among the most interesting, since it touches the vital agencies of civilized existence. The various branches of the subject are so implicated with each other, that it is not easy to come to satisfactory results in any part, without taking a view of the whole; and, at the same time, the subject is one upon which, under our political institutions, it is requisite that all men who take an interest in political affairs (and who does not?.) should form an opinion. It occurred to me that the inquiry might be facilitated by presenting and contrasting the propositions on both sides, in

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INTRODUCTION. a plain, concise form, intelligible to those not particularly conversant with discussions of the sort, as well as to those who are so. I have accordingly attempted, in this epitome, so to present them. My only interest in the subject, is that which I have in common with every citizen who expects to live in the country himself, while he shall live, and hopes to leave representatives in it afterwards, for whom he is bound to care; and that interest is not small, for the welfare of each of us, and each of them, will be essentially affected by that of the community. My direct personal interest, lies, indeed, entirely on the side of ” let-alone,” for the attention I give to the subject at this time, is a material sacrifice, as well as inconvenience to me. I should be happy to believe that there is little at stake, and that the doctrines of free trade do not tend directly to the distress, decay, and political subordination and degradation of this country, and the too great entanglement of its industry and interests with those of other nations.

But it has not happened to me in thus devoting my attention more particularly to these inquiries, as it did some thirty years ago. Being then imbued with that economical creed which is taught in our public seminaries, I had occasion to attempt its vindication, against the aggressions then supposed iv

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INTRODUCTION. to be made on commerce by the useful arts, through protective legislation; and I had the good fortune or misfortune, on investigating the subject anew, to convert myself to the opinions I had undertaken to combat. I came out with the thorough conviction that the science, which seemed so luminous to those at the feet of the Gamaliels, consisted very much of groundless postulates and sophistry. I could not divest myself wholly of a feeling of resentment at having been imposed upon. It is possible that this sentiment may sometimes tinge my phraseology. If it does so, I will rely upon your accepting the cause as my apology, if you are not on the side of free trade; if you are upon that side, you will take it in good part, without any apology, for no persons are less sparing, than the advocates of that doctrine, in applying uncomplimentary epithets to such as cannot say “Shibboleth.” I am, however, assured by friends who have been kind enough to look over my proof-sheets with me, that I have not committed any grave trespass in that way. On again reviewing my economical studies for this epitome, I have not, as you will perceive in reading it, experienced the least symptoms of a relapse into my early creed. W. P. BOSTON, APRIL, 1850. v A*

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CONTENTS. Page. I. Steady adherence to the right principles of legislation in respect to revenue, is material to the national welfare………………………….. II. Revenue laws are intimately connected with industry and with each other -Should be examined as a whole………………………….. III. Industry inevitably affected by legislation Cannot be let alone-The let-industry-alone doctrine baleful and impracticable………………. IV. The Protective Policy runs through the whole system of legislation………………………. V. The Constitution expressly authorizes protection Freetrade pretence…………………. VI. Revenue laws will promote either domestic or foreign industry - Free trade is in favor of the foreign. VII.

The promotion of OUR OWN INDUSTRY, or neglect of it, has momentous consequences…………. VII. Free trade assumes as true at least eleven false propositions, each of which is essential to its sup port, and either of which not being true, the system falls to pieces………………… I 2 4 9 12 14 15 20

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CONTENTS. Page. IX. It is not true that the industry every individual, independently of any law, deems to be advan tageous to himself, is so to the public - Free trade asserts that it is s o……………… X. Some kinds of foreign imports have a better influence upon the general welfare than others -Free trade says there is no difference…………. XI. The whole world is not one community, to all intents and purposes, in respect to trade and industry Free trade maintains that it is so…………. XII.

Men are to be considered as producers, as well as venders and purchasers-Free trade considers them only as venders and purchasers………. XIII.

We can export only certain descriptions of articles, and those only to countries where the money price is higher than with us, whether we take their goods or not…………………… XIV. How much a foreign country will take of our ex ports - There is a limit to the quantity - We cannot dispose of enough exports abroad to pay for an unlimited quantity of imports-Free trade assumes that we can…………………. XV. The same amount of capital in a community can, by protective legislation, be made to employ a greater amount of labor than it otherwise would do -Free trade expressly assumes the contrary. XVI. We have more labor offered, and can supply more products of labor, than there is a demand for at home and abroad - We have a surplus of labor Free trade says we have no surplus…………. viii 22 24 25 30 31 33 37 45

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CONTENTS. Page. XVII. In legislation, regard is to be had to the future as well as the present-Free trade considers only to-day………………………….. 52 XVIII. A war with some great foreign naval power, at some period, is possible; and may cut off the supply from abroad, of means for defensive or offensive operations………………….. 57 XIX. Arts and manufactures do not spring up without encouragement-Disadvantages under which new arts and business labor-Free trade says, ” Man ufactures would encourage themselves as soon as the country was adapted to them.”………. 67 XX.

Low price, whether in money or barter, is not the sole criterion of the best economical policy Free trade assumes that it is……………. 87

XXI. The comparative price at which citizens exchange the products of their labor and capital with each other, is the important consideration -

As long as the ratio of the price of one thing to that of another is the same, it is immaterial, as between themselves, whether that rate is high or low Free trade teaches that the low money price of articles consumed in the country, whether the same be produced at home or abroad, is the sole consideration to be kept in view………….. 89 XXII. We ought not to depend upon any foreign country for such ordinary necessaries of life as the coun - try is well adaptedto produce, at least until we have a naval power able to command the ocean - Free trade proposes to render us immediately and permanently so dependent…………… 91 ix

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CONTENTS. Page. XXIII. Home competition compels producers to as intense competition and as low profits, as foreign - Pro tection not monopoly -Not true, as insisted by free trade, that foreign competition is necessary to put home production at the lowest practicable rate……………………………. 96 XXIV. Protection promotes commerce Old pretence of free trade that it would destroy commerce……

97 XXV. Protection of our own industry will not bring the necessity of resorting to land-tax and excise Free trade pretends that it will………….. 97 XXVI. Balance of trade -There is such a thing -A country may buy of another more than it pays for, or can pay for at the time; it can be con stantly in arrears - Free trade assumes the con trary………………………….. 98 XXVII. It is not for us to take care that other countries shall have means to pay us for our exports Free trade says it is…………………. 99 XXVIII. Protection of our own domestic industry is in no degree hostile to other countries-Free trade pretends the contrary………………… 102 XXIX. The country may be crippled by a foreign com merce that is profitable to those directly con cerned - Free trade says what is profitable to them, is best for the whole country……….. 105 XXX. It is not true that capital remains entire, to be transferred from a bad business to some other Free trade assumes that it remains, and can be withdrawn from an abandoned business to a better.

106 X

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CONTENTS. Page. XXXI. The dogmatism of free trade in persisting in its assumptions………………………. 108 XXXII. Accumulation of capital necessary to prosperity, industry, and arts……………………111

XXXIII. Multiplicity of useful arts in high cultivation prerequisite to great national stock, to wit, capi tal; and great capacity for production-Free trade proposes national poverty………….. 113 XXXIV.

Many arts can be carried on most advantageously in large masses, requiring large capital and many hands - It is accordingly desirable that there should be in the community large aggregations of capital…………………………. 116 XXXV. Protection to the arts promotes agriculture; is essential to its prosperity-Contrary pretence of free trade………………………… 122 XXXVI. The maintenance of our institutions, and the wellbeing of the whole people, depend on sus taining the rate of wages…………….. 128 XXXVII. Protection favors the working classes; is for the benefit of both the many and the few-

-Free trade represents it to be for the few only…… 129 XXXVIII. Free industry, preferable to industry fettered by free tra de………………………. 133 XXXIX. Our extent of territory and variety of climate enable us to extend arts, and thus sustain wages -The effect of free trade is stagnation of indus try, and consequent reduction of wages to the European level…………………….. 133 XL. Vicinity of artisans and cultivators is a great mutual xi

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CONTENTS. Page. advantage to both - Free trade puts them to great distances from each other……………… 135 XLI. Protection operates for the benefit of those in the interior in a far greater ratio than for that of those near the coast and ports -Free trade tends to make a few great commercial towns, and a thinly settled, poor, interior country……….. 137 XLII. It is not expedient to put off the cultivation and practice of the useful and ornamental arts in the United States, until the average of the aggregate money rates of rents, interest, and wages, is as low as in the rival places of production in Europe -Free trade teaches that it is expedient to do so. 142 XLIII. It is not for the interest of the country to put off each useful art, until our own artisans have as great skill in it as artisans in countries abroad, where it has been practised for centuries - Free trade proposes that we should do so……….. 144 XLIV. A duty, however great, cannot operate to give any class of producers an excessive profit but for a short period - Free trade pretends that it gives a permanent advantage to the class…………. 145

XLV. The merely adequate degree of protection should be adhered to -

Pretence of monopoly……… 148 XLVI. The object of protection is to make the interest of the public and that of the individual coincide Free trade pretence of restriction…………….. 151 XLVII. The tendency of putting a domestic product into the market, is, immediately to reduce to the con sumer the cost of the corresponding imported article…………………………… 155 XI1

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CONTENTS. Page. XLVIII. Protection favors those who use capital -Free trade those who have it to lend…………….. 157 XLIX. Protection reduces the money price of the great mass of the most important productions of the useful arts -Free trade assumes that it invari ably enhances the money price at a rate equal to that of the duty…………………….. 160 L. Diminishing the duty on imports does not necessarily diminish the price-Free trade alleges that it diminishes the price in the ratio of the duty… 173 LI. Reducing the duty below the point of adequate protec tion, on an article of which part of the domestic production is exported, diminishes the gross amount of imports and of revenue -Free trade pretends that it augments both…………… 174 LII.

In stating the account with protection, it is to be credited with what it saves to the country; the balance is in its favor, even by the erroneous free trade rule for stating the account-It is incalcu lably more so in a true statement of it……… 178 LIII. Our foreign commerce small in comparison with do mestic-Free trade magnifies the foreign……. 202

LIV. The domestic market steady; permanent; can be relied upon - Foreign, fluctuating and precari ous - Free trade looks only at the foreign…..

202 LV. An ad valorem duty is unequal; leads to frauds…. 204 LVI. Import duty is less burthensomre, and is not attended by greater inequality than revenue raised in other ways -Free trade pretends that it is un equal, etc……………………………… 209 B xiii

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CONTENTS. Page. LVII. Investments made under sanction of law, should not be recklessly destroyed by law-Free trade abjures good faith in quest of present low money price………………………………211 LVIII.

Danger to the domestic arts from domestic compe tition, needs not to be guarded against-Free traders affect to be alarmed for them on this score.

212 LIX. Protection should be proportionate, and adequate… 213 LX. It does not appear that there is any alarming danger of smuggling -Free trade pretends danger of smuggling, and yet facilitates the evasion of duties by false invoices……………….. 214 LXI. Our whole exports bear a small proportion to our whole production, and our whole imports in like manner to consumption-Free trade exagger ates their comparative importance………..2. 214 LXII. Constant never-ceasing extension and improvement and change of the arts, require corresponding modifications of the law - Free trade teaches that legislation should stand at the dead point… 215 LXIII. The country must always have more or less infant arts until it passes its meridian - Free trade sup poses that we go per saltum to the summit of the arts…………………………….. 216 LXIV. The legislation of a country, affecting its industry, should have reference to the opinions, prejudices, capabilities, and habits of its people Free trade disclaims any such reference……………. 218 LXV. Protection and encouragement are necessary to the introduction of new arts or industry; or exten sion of old……………………….. 218 xiv

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CONTENTS. Page. LXVI. The arts are mutually connected and dependent on one another as to the degree of skill and perfec tion in each; they must flourish or decay together. 219 LXVII. Vicinity of arts, immediately auxiliary to one another, is mutually advantageous………….. 221

LXVIII. Protection of domestic industry is due to the in ventive genius of our countrymen -Inconsis tency of free trade…………………… 224

LXIX. Ever since the settlement of the country, the policy of Great Britain has been to discourage and sup press the arts in America, and keep the country perpetually in a provincial state, and one of semi civilization……………………….. 228 LXX. A check to imports, and impulse given to our own production by duties, have always been followed by general prosperity; and an influx of imports, induced by low duty or however else, is always followed by general depression and distress, north, south, and west…………………….. 231 XV

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PROPOSITIONS PROTECTION AND FREE TRADE. I. Steady adherence to the right principles of legislation, in respect to revenue, is material to the national welfare. WE have the highest authority against building a dwelling upon the sand, lest it should be swept away by the floods. The maxim is no less applicable to other branches of industry than house-building. The man who plants a sugar estate, dykes a rice plantation, constructs a factory or a ship, needs the firm basis of the laws and institutions of his country to depend upon, as much as he who builds a house needs a rock. A shifting legislation, and feeble, corrupt administration of law, (as among some of our neighbors on the southern part of this continent,) are as destructive to all kinds of industry as hurricanes, earthquakes, and floods can be to crops or buildings. It is true that the specific provisions of the laws, as well those of revenue (and others more directly affecting industry) as the rest, must be modified and adapted to existing circumstances from time to time; but the policy and principles, on which they ought to be made and changed, 1

CONCERNING

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PROPOSITION II. are surely the same, and of a permanent character; and though the ascertaining and lucid demonstration of those principles, so as to establish them beyond controversy, is obstructed by certain theories, sophisms, and fallacies, and much dogmatism, it is still by no means to be despaired of. These right principles ought no doubt to be adhered to steadily; or, if a change be necessary, it should be slow, and after due notice, that everybody may prepare himself, and the community thus be saved from shocks and revulsions, brought on by legislation. My object is, if possible, to contribute something towards the recognition and settling of those principles. II. Revenue laws are intimately connected with industry and with each other-Should be examined as a whole. If you have ever seen, when a spider touches a thread of his web, how the whole net-work will tremble, you have an illustration of the manner in which all the fibres of all the different kinds of industry carried on in the country are interwoven together, so that a shock in any part is transmitted to the others, and runs through the whole texture. If the price of flour rises, the cost of bread is increased, and with it the cost of living, and with that the cost of labor; for the laborer, whether in agriculture, a mechanical trade, merchandizing, law, physic, or teaching,  in whatever employment, capacity, or profession, - must support himself, or must be supported by his employer, and the cost of his labor will be enhanced by that of his support; and hence, the cost of all the results of labor - that is to say, of everything that bears a value and has a price-will tend to be enhanced by the rise of the price of flour. And the value of the land which produces wheat will also be 2

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PROPOSITION II. enhanced, or, at least, the tendency of the rise in the price of flour will be to enhance it, not merely, as in the other cases, because it costs more, - as it does, fertility being mostly the result of labor, - but because the capacity of an acre to produce twenty bushels per annum is more useful to the possessor, since it yields him a greater net annual value. Whatever affects the price of flour will, therefore, extend its influence over almost all branches of industry, to some in a greater and to others in a less degree, and may help or hurt each, or neither help nor hurt any one of them, whether the tendency is to enhance or reduce the money price. Whether a change of the price of this or any other article will have a good or bad effect upon other kinds of production, we do not now inquire; the present purpose being merely to illustrate the reciprocal dependence and influence of the different species of productive industry one upon another. The article of flour is taken as an example, because the price of bread, and the difficulty or facility of procuring it, will affect every employment more directly and obviously than the plenty or deficiency of any other article. Proceed by a similar process to trace out the connection of the product of any art or species of industry, as of printing, the iron manufactures, those of lead, copper, wood, wool, cotton, hemp, leather, and, if you have not gone through the same process before, you will be astonished to find with how many others it is directly or remotely connected, and on how many others it depends, and how many others depend upon it. Now, every desription of legislation either helps or hurts industry, as we shall more plainly see by and by, and more especially the revenue laws have such effects, in respect to every article which it is possible for us to produce ourselves, 3

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PROPOSITION III. whether the law be to impose a comparatively higher or lower duty on any one, or leave its importation free; and since, as we have just seen, the production of any one of the numberless marketable articles is connected with that of all, or at least very many of the others, and the whole system of useful industry is one immense net-work, it is plain that the amount of duty to be levied on each cannot be judiciously determined without taking into consideration the whole system in one deliberate, broad, and liberal view. Next to the founding and constructing the government itself in its origin, the regulation of the revenue laws is one, at least, of the most important of political acts, demanding gigantic faculties, and labors like those of HIamilton. A fearful subject this, to be submitted to the experiments of fanatical visionaries, or to be the sport of factious intrigues and party frenzy, or an instrument for gambling in the hands of unscrupulous political charlatans, prone by instinct and consecrated by destiny to the public detriment! In order to come to true conclusions upon this subject, we must examine its divers parts, as connected together in one whole. III.

Industry inevitably affected by legislation -Cannot be let alone-The let-industry-alone doctrine baleful and impracticable.* It is a stereotyped doctrine of free trade, that to let * “Let them alone, is all that is required of man; let all international exchanges of products move as freely in their orbits as the heavenly bodies in their spheres, and their order and harmony will be as perfect, and their results as beneficial, as in every movement under the laws of Nature when undisturbed by the errors and interference of man.” Secretary Walker’s Report, 1848.

This is a rhetorical repetition of Adam Smith’s dogma in respect to all species of industry, which he himself directly contradicted more than once, and which has in like manner been repeated and contradicted by his school from his time to the present. 4

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PROPOSITION III. alone industry is the true way to promote it; and Mr.

Polk, when he took the position that duties are to be levied with a sole view to revenue,- meaning, without any regard to the effect upon industry,- as extraordinary as the doctrine may seem, expressed no more than the doctrine of his school, and the plain upshot of all the logic of their writers upon this subject. Now it is quite obvious, that, in regulating duties, and in all other legislation, the industry of the country will necessarily be affected for the better or for the worse; it will either be promoted, or be embarrassed and depressed; whether, in making the laws, we take it into consideration, or wholly disregard it. We cannot, then, “let it alone,” without ceasing to make or have any laws. We must legislate, and administer the laws, in respect to industry, and so either promote or depress it, or, by ceasing to have laws, relapse into barbarism, and, by so doing, affect industry in the utmost possible degree, that is, annihilate it. The let-us-alone dogma is, therefore, saying, in other words,- Shoot at random without taking aim, and you will be sure to hit the mark. Industry is the living fountain of welfare, publie and private. Those who say we must levy duties or omit levying them, or do or omit any other act of legislation whatsoever, without regard to its effect on industry, insist that the doctor shall have no regard to the patient’s health, but shall let him die if he will. It is not in the wit of man to frame a more profligate and fatal maxim of legislation. It has always been the doctrine, as well of the freetrade advocates as the protectionists,- a doctrine common to all parties and all sects,- that the excitement and furtherance of useful industry is desirable. Mr. Polk, and his secretary, Mr. Walker, and many others of the same economical I* 5

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school, extol agriculture and depreciate arts and manufactures in comparison, and represent them as antagonistic to agriculture. The author of an elaborate and apparently leading freetrade pamphlet,* published in 1821, says: “The only difference which the various uses of capital can make to the nation is, that in some employments the same amount of capital will employ and support a greater number of laborers than it would in others.” And upon this ground he advocates the pursuit of foreign commerce in preference to the domestic arts. All agree that it is a transcendent economical principle, that such a course should be pursued in legislation; and all such social and moral influences should be resorted to as may tend to produce the greatest degree of the most useful voluntary industry of the greatest number. I say voluntary industry, for nobody proposes to follow the example of the Chinese emperor, who drove out his people in multitudes to build the great wall, or that of the Pacha of Egypt, who in like manner made the canal from Alexandria to the Nile, but every one agrees in the expediency of holding out inducements to useful activity.

This principle is assumed in all discussions, by whomsoever and wheresoever, to be that of effectuating the greatest happiness of the greatest number. The doctrine is not confined to climate or section. It is as true applied to the South as to the North, to the West as to the East, and to the seaboard as to the interior. The material and debatable question, upon this subject, relates to the species of industry to which any particular country and its population are adapted. So the professors of free trade themselves put it. They say that we in the United States are adapted only to agriculture and trade, meaning * Examination of the New Tariff proposed by Henry Baldwin. By One of the People. Published by Go’ild & Banks, New York. Page 177. 6 PROPOSITION Ill.

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PROPOSITION ItI. principally the export and import trade, whether by our own ships or foreign, and a certain line of policy will promote these and depress others; for it is a material part of their doctrine, that it will depress arts and manufactures, since otherwise their doctrine is the same as that of the protectionists, who differ from them only in saying that our country and population are adapted to the working up of wood, leather, wool, cotton, and iron, to some extent at least, as well as to the producing of these raw materials; and, therefore, that the arts and manufactures should, to such extent, be encouraged and promoted. All thus agree in the doctrine that industry, in general, is of prime importance, and the promulgator of free trade, no less than the protectionist, undertakes to form an opinion of the species of industry, and determine to which the country is adapted; and each professes the expediency of promoting his species of industry; and each also professes to be able to discriminate what measures and proceedings will tend to promote his own favorite industry and depress other kinds. Legislation, either neglected or practised, and by whatever policy guided, will, as we have seen, proprto viore, and, whether so intended or not, affect the industry of the country, and either promote or depress it. When this question is once settled, therefore, whether our circumstances confine us to the mere production of provisions and the raw materials of agriculture, or extend also only to the coastwise carrying-trade; or merely include, besides that, the foreign carrying-trade; or go a step beyond, and embrace, to a certain extent, the working up of wood, leather, wool, cotton, and the metals, into useful or ornamental forms and fabrics, -then, after settling this preliminary question, it follows as a necessary consequence, and a direct deduction from these premises, to which the 7

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PROPOSITION III. freetrader agrees as well as the protectionist, that the true course is to protect, foster, encourage, and further every such species of industry, by legislation, publications, public addresses; example, by turning the current of habit and fashion and custom towards it; and by other influences and incentives, in measure and degree according to its import ance, and in proportion to the obstacles in the way of naturalizing and perfecting it. This is the practical doctrine which intelligent men, who act upon any general principle of public policy, are constantly inculcating upon others, and constantly acting upon themselves. There is no question of this, I think; and yet how does it tally with the let-alone dogma? You cannot say that you will legislate and do other acts blindfold and reckless of consequences, nor can you deny that your making a law or doing any other act of public influence, whichever side or whatever course you may take, will have a direct or indirect, and, in many cases, decisive influence upon one or another branch of industry. You might as well talk of opening the valve of a steam-engine, and then letting it alone to do the transportation between two termini, as to talk of the possibility, or, were it possible, of the expediency, of letting alone industry. It is the pickpocket, the cheat, the impostor, the man of false pretences, who says universally, Laissez-znous faire, Leave us alone. The millions of the industrious invoke the laws and all the social influences to help them, or rather to enable them to help each other. Help them or harm them you must. Destiny so has it. The question is, What is helpful and what is harmful; and that we will subsequently consider. At present, we are, I think, authorized to aver the proposition that the doctrine of letting alone, totally disregarding, and ignoring industry, by way of promoting it, is profligate, false, and absurd. 8

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PROPOSITION IV. IV. The Protective policy runs through the whole system of legislation. It is the great predominating object of constituting society, and of conducting legislation under its constitution, and also of a vast proportion of private associations and individual benefactions, directly and indirectly to foster, protect, and promote useful industry. This principle, by universal admission, lies at the foundation of this entire magnificent social fabric. What Hooker says of law is no less applicable to this principle, ” None too high to do it reverence, and none so low as not to feel its fostering care.” The entire stock on hand -the present value of the lands, the buildings, the improvements, the thousands of movable things now possessed, is not so much the subject proposed to be secured and protected by legislation and social and political institutions, as the industry whereby all this value is perpetually reproduced, since the amount of this entire existing value is consumed and again reproduced evely six or seven years; so that the aggregate industry of the community is to the aggregate value of its possessions, in the proportion of the enjoyment of a thing forever, to the enjoyment of it for six years. All possessions are the preserved fruits of labor, and guarded and protected, not merely for their own sake and out of reverence to the principle that every one shall enjoy what, by the laws of nature, is his own, but also for the purpose of encouraging useful industry in all its thousand forms; for what would labor avail to thec laborer if its fruits were not secured to him? Who would labor to produce what may be wrested from him by the first wrong-doer he meets? The protection of property is thu~ intended, and essential, as a security and protection to industry, and also as an excitement to it. 9

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PROPOSITION IV. The first act in forming society, and in legislation, and in the administering of law, is directly based upon the protective policy.

The founders of our government were protectionists in fact, as well as in principle; and you may just as well inculcate the let-alone doctrine in respect to the incendiary as to the useful laborer; you encourage and sustain the laborer, and restrain and punish the criminal, upon precisely one and the same principle. Whether you levy taxes, make highways, railroads or canals, authorize aqueducts, bridges, embankments, mill-dams; raise armies, train the militia, make treaties, construct fortifications, manufacture arms, maintain schools, regulate marriages, grant patent rights, regulate fences, the occupation of lands held in common; restrain the sale of poisons or intoxicating drinks, prescribe the hours for a day’s work, require that children shall not be hindered from attending school, or shall be sent to school, make inspection laws, authorize ferries, forbid the killing of useful wild animals at certain seasons, give rewards for destroying wolves, bears, etc., regulate fisheries, prescribe the rate of interest, provide for abating nuisances, lighting streets, preserving land-marks, piloting vessels; regulate weights and measures, and stamps; coin money, provide for a currency, establish and regulate banks, suppress gaming, prescribe the proceedings in civil actions, the forms of contracts and grants, and wills, and the descent and distribution of estates; enact sanitary laws, and poor-laws; grant acts of incorporation, make laws of trade, internal or foreign; regulate navigation; prescribe quarantine; build and maintain light-houses; construct harbors; establish post-offices; prohibit the sale of unwholesome provisions; give rewards for agricultural or other productions; prescribe the duties of carriers; levy taxes; or authorize assessments in counties and towns, associations, and corporations; establish judicatories; 10

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PROPOSITION IV. in a word, whatever laws you pass or neglect to pass, either economical, civil, or criminal,-you, in the great mass of the subjects of legislation, intend and profess, directly and studiously, to excite and promote useful industry, by giving it every possible facility to bring out its products, and every possible protection in the use and enjoyment of them when brought out; and without such encouragement and protection, its products never can be realized. The let-us-alone doctrine is for the marauder, the bee that plunders another’s hive, not for the one that collects its stores in the fields. Examine for yourself this view of the objects and principles of the social institutions and of legislation in general; if there is any mistake or fallacy in it, you will easily detect it, for the whole subject is within the experience and comprehension of every man, though he may never have read a treatise on political economy. If you consider it correct; if the proposition is a plain expression of your own opinion, such as you now entertain and always did entertain, as you certainly will find it to be, then you cannot help saying that the le-alone doctrine, which is the fundamental dogma of free trade, is a fallacy, flimsy and transparent in the superlative degree. It is so directly contradictory to the common thinking and acting of all men of all times and places, those professing free trade, no less than others, that the promulgation of it as an axiomatic proposition, if sincere, seems to be a strange intellectual phenomenon, and if not sincere, an act of signal effrontery. This is not the sole foundation upon which the advocates of free trade put their theory, but it is the main one. The others shall be considered in their proper place. I think we may put this one down to be classed with the “straw and stubble,” on which no man-of sense and honesty will build. We must then scout the doctrine that the legislator must 11

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PROPOSITION V. turn his back upon the industrious laborer, or the industrious and honest capitalist, whether great or small, and we must adopt the opposite one. No intelligent, honest man can, it seems to me, have a choice; he will find himself under a grateful necessity to believe and admit, that civil society cannot be maintained, nor any system of legislation and civil administration carried on, without either promoting or discouraging useful industry at every step and every stop; and that it is a great fundamental principle that indlustry, instead of being let alone, is to be always kept in mind, and always helped, and protected in all suitable forms and ways possible, in due measure and proportion, according to the particular object and the particular circumstances; so that it shall be for the interest of every member of the community to employ himself and his capital, great or small, in arts and pursuits conducive to the common weal. Some professor of free trade will reply, that “This is precisely what free trade proposes and will effect.” We shall see. At present let him admit that industry is not, and cannot be, let alone, except by such practical political economists as the Esquimaux of our own continent, or the Buslhmen of Africa. V. The Constitution expressly authorizes protection - Freetrade pretence. Some of the learned expounders of free trade and constitutional law, pretend not to be able to discover in the constitution any authority to impose a duty on imports, for the purpose of promoting domestic production. They say further, that in imposing any duty on the import of an article, Congress is bound not to have any regard to the effect upon domestic industry, means of national defence, or wel 12

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PROPOSITION V. fare. This is the doctrine of divers messages and speeches, if my memory serves me well; it is, however, very possible that I may not state it with rigid precision, and I will, therefore, bring myself within the secure limits of the assertion, that they profess to find some insurmountable constitutional barrier against the protection of domestic industry by duties on imports. I mention the subject here, for if there really is this formidable guard at the threshold, forbidding ingress, it will be prudent to retreat at once; but if on the contrary, we find it to be only a fanciful “picture of nobody,” such as some of the people of the East Indies put up at the side of their doors, we shall not be afraid. The constitution authorizes Congress to “lay and collect imposts, provide for the common defence, and general welfare, regulate commerce, and make all laws necessary and proper for carrying into execution the foregoing powers, and all other powers vested in the government, or any department or officer thereof.” Here seems to be “literal” authority in great abundance for protection of industry by levying duties. But, say the professors of the same school, the constitution must be construed not only “literally” but also strictly, so as to find as little authority as possible given by it, and if none at all so much the better. Any other principle of construction, say they, is latitudinarian, against the sovereignty of the States, and the fundamental doctrine of nullification.

They insist that the true principle of construction is the opposite one, that has neither latitude nor longitude, neither breadth nor length; so infinitesimally minute that it deals in points, without magnitude or space. It is a hard imputation upon those who framed this instrument, to suppose that they intended such a futile impracticability. By another provision, “the importation of such 2 13

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PROPOSITION VI. persons,” etc., meaning slaves, was not to be prohibited prior to 1808, whereby they expressly recognized the general power of Congress to prohibit an “importation;” a fortiori, Congress can check, and modify, and limit and control one. If four express grants and one specific recognition, do not confer a power, what device can be resorted to for the purpose? The English language has no expressions more decisive, and the plain meaning is confirmed by the history of the States preceding the adoption of the constitution; by the reasons for adopting it; and the legislation under it. Any person who can really persuade himself that the constitution does not plainly confer upon Congress the power to impose duties upon an import, or to prohibit it, for the sole and exclusive purpose of promoting domestic industry, or suppressing a vice, or any other object deemed to be promotive of the general welfare, must very frequently find himself at cross purposes with other people, by reason of his whimsical conceptions of the import of the English language. VI.

RPevenue laws will promote either domestic or foreign industry - Free trade is in favor of the foreign. All legislation, as we have seen, promotes or hinders industry, either of all kinds or some kinds, as the case may be. The same is true of many fashions, prejudices, tastes, opinions, passions, and associations for industrial or other purposes, -indeed, the greater part of social influences. Since, then, legislation pre-eminently will promote or obstruct this or that art, or the arts generally, is it not of infinite importance to consider what effect any measure will have in this respect? Legislation, supported by the administration 14

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PROPOSITION YVII. and enforcement of the law, in fact, sits supremne arbiter, predominating over all other causes in determining the destiny of the country in its career in arts and civilization, whether to be long and triumphant, or short and unhappy. Among all the influences bearing upon the subject, no one is so decisive of our destiny as the regulation of the struggle between our own domestic arts and industry of all sorts, with the antagonist arts and industry of other countries. Legislators cannot stand neutral, as mere lookers-on at a drama, in the catastrophe of which they have no hand. They are the appointed, responsible actors and agents, and the result, whether success or ruin, is of their achievement. The false pretence of free trade not to act, is, in fact, positively and directly, in the most efficient manner possible, taking sides with the foreign competitor. The pretence that the government is to be neutral in this contest, is as preposterous as to pretend that it is to be neutral in the case of hostilities with any foreign country. The strongest party may well inculcate such a doctrine, and that is precisely the reason why British artists and capitalists modestly inculcate it upon our government. VII.

The promotion of ouR owN INDUSTRY, or neglect of it, has momentous consequences. We may, then, consider it to be an established, indisputable, and, indeed, on all sides admitted, principle, that legislation, as well as the neglect to legislate, and also the policy and administration of the government, will forward or hinder the national industry and the progress of the domestic arts. We shall readily see that it is of infinite importance to favor and promote that industry and those arts. This you admit, perhaps. So much the better. 15

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PROPOSITION VII. But some do not admit it: the late administration did not, when it recommended to Congress a duty on tea and coffee, which we do not produce, in preference to raising the revenue on such articles as we do produce; for which, as far as I can perceive, it could have no possible motive, but to avoid the encouragement of our own industry; and to such a degree was it actuated by the dread of merely incidentally promoting the useful industry of the country by the mode of levying the imposts, that, for the purpose of avoiding this, it was recommended that a duty should be imposed on the two imported articles in the consumption of which the poor man comes nearer to an equal amount with the rich man than in any others, except drugs and medicines. By this and other like propositions, the same executive has done service to the country; for before its messages and reports and offieial documents were promulgated, only Mr. Mc(ulloch of London, and some few of our Southern politicians of the abstract, metaphysical school, had explicitly avowed the fallacious postulates and extravagant sophisms of freetrade logic. It was desirable to have some authority of a practical character, even if no better than official or sectional and partisan, for the preposterous results to which the freetrade theory necessarily leads, and this we now have, such as it is; so that, if we state the doctrines in plain terms, we are not liable to be told, that, though such doctrines may be those of Adam Smith, Mr. Senior, Mr. MecCulloch, etc., they are not those of our professors of free trade.

There are, then, those among us, besides recluse, speculative theorists, who profess and teach the transcendentalisms of that so-called scienee, as thus appears by vouchers and signatures, -persons who go to, at least, the ultima Thule of the system, if not beyond. The great importance of labor and its annual products 16

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PROPOSITION VII. merely in respect to value, independently of other considerations, appears manifestly from the fact, that it is, in comparisori with the entire value of real and personal property in the community, as has already been suggested, in the proportion of the absolute possession of a thing forever to the value of the use of it for six years. Vary this proportion as you may, from any data of the least authority, still the value and importance of the labor will immensely predominate; from which it necessarily results, that the promotion of industry is of vital importance. Arts, civilization, national strength and progress, political life or death, depend upon it. Take an illustration of the effect of a want of employment in the case of Pittsburg in 1819, from M1atthew Carey’s New Olive-Branch. You may make as much allowance as you please for any supposed want of exactnless in his statistics, though he plainly intended to be within the mark, and still this cause of poverty and distress will be sufliciently fearful. Hle says, “This city, in 1815, contained about 6,000 inhabitants. It exhibited as exhilarating a scene of industry and prosperity as any place in the world. Its immense local advantages, seated at the confluenee of two noble rivers, forming the majestic Ohio; its boundless supplies of coal, and the very laudable enterprise of its inhabitants, had for a long time rendered it the emporium of the western world. But alas! the immoderate influx of foreign manufactures poured in there shortly after the peace, produced a most calamitous reverse. The operations of the hammer, the hatchet, the shuttle, the spindle, the loom, ceased in a great degree. Noble establishments, which reflected honor upon the nation, were closed; * the These were, no doubt, put up to supply the necessities of the country during the war of 1812,-what Mr. Secretary Walker considered to be monu 2

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PROPOSITION VII. proprietors ruined, the workmen discharged, a blight and a blast overspread the face of the city; and the circumjacent country, which had shared in its prosperity, now equally partook of its decline.”

And he states that by a minute investigation, conducted by citizens of high standing, it amppeared that 2,576 people of that city had been deprived of the employment which supported them; that is, over one third of the population had lost the income from their labor, to many of whom it was their sole income. The loss in that one year in the wages of labor, compared with 1815, he computes at $1,735,833. He makes the corresponding loss in Philadelphia, $7,100,804. Here is a result in two cities, one on the seaboard, and one in the interior, which would represent the country generally. The population of these two cities was then about 115,000; and that of the United States, exclusive of slaves, about 8,800,000; from which data, allowing that the average intensity of distress for want of employment throughout the country, was one eighth of the estimate for those two cities, the result is a loss on industry alone that year, of $83,750,000. Vary the statistics as you please, still if you admit of any fraction whatever of the population being thrown out of employment, you will come to a result demonstrating the pre-eminence of industry, and the mighty effect of whatever enlarges or curtails it. But this is not the whole of the destructive effect of any law or policy, or any neglect to make a needed law, or to follow an expedient policy. The income of capital, that is, the advantage annually accruing to every man, rich, or of ever so small possessions, in land, tools, or industrial mate ments of folly; that is, the folly of industrious, enterprizing men, who come to help the country in its need, when the freetrader folds his arms, and says, Let alone. is

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PROPOSITION VII. rials or means of whatever description, is depressed by the same cause. This accumulated stock of tools and materials, which we call capital, cannot, in such circumstances, all be used advantageously.

If one man in ten is out of employment, then one plough in ten will be out of use, and the wages of men and the value of implements will be reduced two or three tenths or more, and so on through the whole variety of trades, industrial instruments, and materials of all kinds, even the most necessary in their degree; for if men of very moderate means are out of work, they will be less comfortably clad, fed, lodged, and sheltered, that is, will demand, use, purchase, and consume a less amount of every sort of things, than when they had full employment. Thus the fact of their being out of employment will be again the cause of their continuing so, since their motive to labor for themselves, and that of others to employ them, is to sell the products of their labor in the market, as the consumption of almost every individual in a civilized community consists in but a small degree of the direct products of his own labor, and there is thus, by reason of the diminished consumption, less demand for the products of labor, and for the use of all the lands, tools, materials, and apparatus, namely, stock and capital, of the community, to employ labor upon.

Diminish industry, and you bring in a train of evils fertile again of new evils, in an endless succession. We may, then, safely say, that whatever legislation or course of policy diminishes our own industry, or neglects to promote it, is wicked, calamitous, and ruinous. 19

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PROPOSITION VIII. VIII. Free trade assumes as true at least eleven false propositions, each of which is essential to its support, and either of whiech not being true, the system falls to pieces. It is surprising with what a complacent simplicity of unconscious self-conceit, many of the political, social, and economical thinkers of these times of ours, propose the total destruction and reconstruction of the whole social and industrial system of their own country, or of all Christendom. The St.

Simonians, the Fourierites, the Communists, the Amazons, have less scruple and compunction in sweeping away at a dash the whole social system, than a young author in erasing his bad fine passages. The thorough-going theorist of free trade is of the same stamp. Hle proposes what is in the extremest degree theoretical, never having been practised in any civilized community excepting some small commercial places of trivial internal resources, and assumes in its support, as preliminary concessions, and essential and fundamental postulates, at least eleven palpably erroneous propositions.

The original proposition that embodies his theory, viz. the let-alone dogma, assumes what is an impossibility, as applied to any community that is governed by law; since, as we have seen, legislation cannot let alone industry if it would. The demonstrator of that “science,” then, assumes as part of his premises, that what each individual supposes to be most for his own private interest, is most advantageous to the public. Hle instructs us that, commerce being only an exchange of equivalents, the sole criterion for discrimination is that made by the trader, viz. the comparative money price at the 20

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PROPOSITION VIII. time, in the market; and, except this difference, one sort of import is as advantageous to the country as another. He repudiates boundaries and nationality in matters of foreign commerce, and says our interest, in this respect, is identical with that of every other nation, and that the true commercial system is an absolute international communism; that the interest of each is identical with that of each other, just as before, the interest of every individual in a community, as he himself calculates it, is identical with that of the community. He forms his theorems upon the supposition that men are merely venders and purchasers, and not producers. He assumes that the market for all vendibles is unlimited, and that a glut is an impossibility. He lays down the doctrine that a given amount of capital will inevitably put in motion, proprio viqore, a certain amount of industry, which cannot be increased by legislation; and then denies his own proposition; and then goes on reasoning from it, through immense treatises, as being true. He assumes that every man and woman and child in the community, able and willing to work, has full employment at fair wages. He assumes that the interest of the country is the same, and it is to be governed as if its affairs were to be wound up and the final balance struck, in a profit and loss account, in dollars and cents, at the end of the current year, or month, or day; and that this result is an infallible index of the progress or decline of a nation. He assumes that the millennium has begun, and war can never more occur. He asserts that whatever production the country and population are adapted to, will spring up spontaneously without protection or encouragement at precisely the proper time, in 21

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PROPOSITION IX. successful competition with the unchecked influx of foreign products. The theorist of free trade takes for granted in the outset, either tacitly, or by direct assertion, at least, these eleven propositions, and presumes upon your conceding them; and if you deny him any one of them, all his deductions vanish, and his science is gone.

Though these eleven fundamentals are all, as I have said, palpable and glaring fallacies, and speak plain enough for themselves, yet we will examine those not already disposed of, as we proceed, in connection and contrast with what must be the true propositions, if those are false; and also, in the sequel, we will consider separately, the other doctrines of that same science, so styled, that are corollaries, and different phases, of these same eleven extraordinary postulates. IX. It is not true that the industry every individual, in dependently of any law, deems to be advantaqeous to him self, is so to the public - Free trade asserts that it is so. Let us examine the original foundation of the let-alone doctrine, and see whether it will crumble as coon as you touch it. It begins with a false implied assumption of Adam Smith, who says, that “Every individual can judge better than any statesman or lawgiver can do for him, what is the species of industry his capital can employ, and of which the produce is likely to be of the greatest value.” This proposition assumes that protective legislation.presupposes the legislator to affect to know what is for the individual’s interest better than the individual himself, whereas it never presupposes any such thing. Protective legislation presupposes that the legislator knows that certain kinds 22

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PROPOSITION IX. of industry are useful and certain other kinds are hurtful, and that certain kinds of industry need fostering, certain others do not, and certain others need to be prohibited and put down. In one form, it proposes to protect the individual against plunder and violence; in another, against fraud; in another, to help him begin a useful new business without loss; and in another form, to relieve the laborer against domestic competition, by introducing new employments; and in another, to sustain labor against foreign competition. It proposes to make it for the interest of individuals to pursue a species of industry which, as is supposed, it will be advantageous to the public that they should pursue.

In one of these forms it grants money to defray the expense of experiments for the application of electro-magnetism to mechanics, because it is supposed, or rather it is evident, that such an application, if practicable, will be of public utility, and that it would not be for the interest of any individual to make the experiment requisite to test it. So much for the sham presumption. Second, for the other prop, the false express proposition, which is that “The study of his own advantage, naturally, or rather necessarily, leads every individual to prefer that employment for his capital which is most advantageous to society.” That is, the burglar’s capital consists of a bunch of false keys and picklocks, and the study of his own advantage naturally leads him to employ this capital in gaining entrance into your house by night, and stealing your plate, which employment thereof is most advantageous to society. The starved apothecary prefers to employ his capital in selling poisons; the quack doctor in vending deleterious nostrums; Eugene Sue in publishing immoral stories, etc. etc. 23

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PROPOSITION X. A more glaringly false proposition than this was never put forth. But the thief, etc., are exceptions, says Adam Smith’s disciple.

True, and there are a thousand others, that you can enumerate ex tempore, some criminal and as many lawful, and this it is that makes the proposition palpably false. If an individual could be as Louis XIV. styled himself, the state, if he were an independent immortal national integer, then there would be an exact analogy; but as he is only an infinitesimal ephemeral fraction, it is quite otherwise. A nation ought to act as a sensible individual would if he were a nation. This shallow truism is all the truth that can be extracted from this grand fundamental proposition of Adam Smith. I think, then, we may safely say that the let-alone doctrine is based upon a miserable fallacy.* X. Sonme kinds of foreign imports have a better influence upon the general welfare than others - Free trade says there is no difference. The motive to all foreign trade on the part of the individual who pursues it, is profit, and it will flow in the channels where the profit is greatest. If it were supposable that one kind is prejudicial to the country, it would seem to follow that the law, as far as convenient and practicable, should discourage it, or absolutely prohibit it, as it does the slave trade; and, vice versc, if some kinds were beneficial, that they should be encouraged. But free trade says that none ought to be either encouraged or discouraged by legislation. This is, in effect, to say, that whatever trade is most profitable to Mr. Colton, Pub. Econ., N. Y., 1848, p. 56, Is willing to adopt the doctrine of the freetrade economists in the sense that a nation should observe rules of economy, no less than an individual but this is not their sense. 24

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PROPOSITION XI. the importer is most beneficial to the community. This doctrine is expressly so stated by Adam Smith and his disciples. But, say you, there are exceptions. Then you undertake to discriminate between different kinds of trade, that is, different kinds of industry; and to discourage and prohibit some, and to prefer and promote others. You are not, then, of the sect of free trade, but a protectionist, for this is all that the latter proposes. XI. The whole world is not one community, to all intents and purposes, in respect to trade and industry-Free trade maintains that it is so. The freetrade creed assumes and asserts, that, as to matters of industry and trade, the whole world is one community, and that legislation and the administration of law ought to proceed upon this supposition of universal fraternity; and that, whenever any country acts upon the notion that its commercial or industrial interest is in competition with that of any other, and endeavors to favor and protect its own, it commits a great blunder. This doctrine is necessarily included in the comprehensive, negative, one idea of “let alone.” We are only to study “the greater increase of the aggregate produce of the world.” What avails addressing arguments to persons who, in practical affairs of business, and, in fact, of life and death to poor laborers, talk about “increasing the aggreyate produce of the world?” This theory of national communism is inculcated with as solemn gravity and confidence as religious enthusiasts assume, when they announce the millennium. Anderson, speaking of the English Navigation Act, says: Mill, Pol. Econ., c. 25, s. 2. 3 25

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PROPOSITION XI. ‘The Rump Parliament made a most excellent and memorable law for the advancement of our shipping. It had been observed that the merchants of England, for several years past, had usually freighted the Hollanders’ shipping for bringing home their own merchandize, because their freight was at a lower rate than that of the English ships, whilst our own shipping lay rotting in our harbors; which determined the Rump Parliament to enact that no merchandize should be imported into England in any but Englishbuilt ships, belonging to English subjects. The novelty of this act occasioned at first loud complaints, that although our own people had not shipp’ng enough to import whatever they wanted, they were nevertheless by this law debarred receiving due supplies of merchandize from other nations, who only could, and, till then, did, import them.” *

This act was the foundation of British useful arts, commerce, and power.

It was carrying the protective policy to an extreme, but not a thousandth part so dangerous and deadly as the opposite one of the freetrade doctrine of Let alone, and all things will of themselves work for the best. Hlad the Rump Parliament gone upon the principle, that, as to commerce, the English and Dutch were all of the same community, n’importe, c’est egal, according to the freetrade theory, Great Britain and Holland would not now have held the same relative rank among nations as they do.

The Dutch were then decidedly on the freetrade side, as far as navigation was concerned, and went to war in its defence, just as the English now, in many matters where they imagine that they now have the same advantage that the Dutch then had in navigation, are strenuous advocates of free trade.

This doctrine of the community of interest between differ * And. Com., vol. 2, p. 415. 26

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PROPOSITION X1. ent nations collectively, and inhabitants individually, fanciful as it is, is a fundamental resting-point of the freetrade hypothesis. It may be put into Adam Smith’s formula for calculating the veritable cause of the wealth of nations, as, thus, every nation knows what branches of industry are most advantageous to itself, and what is the most so to itself, is most so to all nations. This theorem is as applicable to nations as to individuals, to whom he applies it. You have, therefore, only to let them alone, whether they return you the compliment or not, being sure that whatever they do will be for your advantage, and for that of every other country and its people. This is the philosophical lesson, gravely, and with a magisterial air, inculcated upon practical men by the professors of free trade. The thirty-four young men who were graduated at Harvard College in 1770, dressed in homespun cloth,*
considered it to be quite a different thing whether their dress were of domestic or British manufacture. The cosmopolitan communism of free trade is in striking contrast also to the first act under our government, in 1789, when the people, with Washington at their head, were fresh from the great achievement of the last century. I would choose rather to sympathize with his sentiments, in wearing a home-made dress at his first inauguration, and with theirs in applauding this act, than to enjoy the torpid satisfaction of the freetrade economist, in computing the imagined loss of a shilling in the money price at the time, by the misapplication of labor in making that garment. Suppose that it appeared as plain as the estimate of the Iscariot, that three hundred pence might have been saved by the sale of the box of ointment, that the shilling might have been saved by * Holmes’s Am. Annals. 27

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PROPOSITION XI. importing the cloth for the garment from England or Ger 
many, or still more by importing it ready made up, it would not make out a case. The freetrade economists pretend, as he did, charity to the poor, and with as good reason. As to the man who has capital, it is indifferent to him, so far as his private interest is concerned, whether he employs it in importing the article, or hiring workmen to produce and make it, provided he can, in either case, depend upon the good faith of the government. But not so with the journeyman, or laborer, whose industry is his only capital. He cannot elect out of the whole world where to use his hands. He does not choose to expatriate himself. His whole capital, like himself, is American. He is rooted in the soil. He is not a cosmopolite as to industry and arts-; he is an American. It, therefore, makes a great difference to him whether his trade can be carried on here, or is to be exiled to England, Germany, or India. He feels also that it is a great benefit to him to have a great many persons of different trades about him in his own country, who will take the articles he makes, for he is much more sure of their custom than of that of a workman in Leeds, or Brussels, or Canton. He feels that he depends almbst wholly upon American customers, of a different trade from his own. He makes hats, say, and if the person who makes the coat that he wears, is in his vicinity, he is sure of a customer for a hat, but not so if his clothmaker is in Germany. The case of the person employed in or upon the earth, is still stronger. Of most articles produced directly from the earth nearly the whole are consumed within the country. Such products constitute from two to three fifths of the expense of living of the people, and residents in the country must be supplied with them from their own soil. Some three fifths of our population are employed about these pro 28

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PROPOSITION XI. ducets. Every inhabitant of the country, employed in any other way, goes to them for a supply of two to three fifths of all that he uses and consumes. Does the inhabitant of Leeds, Brussels, or Canton, in China, take the same proportion? If the foreign artisan is in India, he takes nothing of our agriculturists; if he is on the continent of Europe, he takes next to nothing; if he is in England or Scotland, he cannot, even with the free admission of grain and provisions, take as large a proportion of his articles of use and consumption in products imported there; and most of those he would use, would come from Denmark, Poland, and Russia. One inhabitant of this country, therefore, affords as much demand for the products of our land, that is, uses and consumes as much of them, as ten, twenty, or thirty inhabitants of England or Scotland would do, under the freest possible admission there of those products. The truth of this statement, as a general proposition, is fully within the knowledge and comprehension of every man. There is no need of statistical tables for vouchers. Can anybody say, then, that it is a matter of entire indifference to us, whether the person who furnishes an article that we use, resides in this or the other hemisphere? Is it not an outrage against the ordinary conventional decorum of discussion, to state such a proposition? Besides, we are not yet so far gone in cosmopolitan communism as not to care more for an American, than for an inhabitant of Scotland or Holland; and of the two, not to prefer to contribute to the wellbeing of the former; or his continuing at all to be. There is at least one difference to us between the foreign artist and the American, that affects our economical calculations, for if the foreigner is not supplied with labor to support himself, there is perhaps, one chance in two, that he will not be shipped out to this country to be supported in the 3* 29

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PROPOSITION XII. alms-house here, whereas there is no such chance of exemption in the case of the American; if he cannot support himself by his own industry, he must be supported by that of his neighbors. We may, then, safely say that the whole world is not to all intents and purposes one community, as to matters of trade and industry, without any national or sectional discrimination; that our own fellow citizens, in whatever part of the United States, are of greater importance to us, in respect to our national economy and prosperity, than an equal number of those of Havre, though these latter take considerable quantities of our exports; and that the contrary doctrine is as false in science as it is repugnant to national sentiment. XII. Men are to be considered as producers, as well as venders andpurchasers - Free trade considers them only as venders and purchasers. Almost every one in the United States, of any mental and physical capability, is a worker, a producer. The first question that each puts to himself, and that every legislator ought to put also to himself is,- What course is most likely to open to him a chance of producing something to be consumed by himself or exchanged? The advocate of free trade answers for the legislator, “No course.” This we have seen to be impracticable, and also inconsistent with the whole conduct of all legislators, philanthropists, moralists, and economists, of whatever theory or sect. In other respects than in respect to the regulation of commerce, they declare themselves, and act, in direct contradiction to the fundamental dogma of free trade. To the present point then, they suppose, that every person has now on hand a certain article for sale. They do not 30

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PROPOSITION XIIt. go behind this state of the case, and inquire what policy in legislation will enable every one to obtain such an article: let him alone for that; they suppose him to have it. They then assume, secondly, that some one of the antipodes will take it of him at a fair price; whom, if left alone, if in fact he possibly could be so, by legislation, and all influences and helps whatever, he will infallibly find. The protective system, on the contrary, considers people, in their character of producers, as substantially all of ours are. They inquire, not merely how you may make a good bargain in the exchange of what you already have, which i a very proper inquiry; but also, which is immeasurably more important, what course of policy is best calculated to put you in the way of producing something more; that is to say, to give you a chance for industry. XIII. We can export only certain descriptions of articles, and those only to countries where the money price is higher than with us, whether we take their goods or not. This proposition that we can export only to the countries where the money price is higher than with us, is too obvious to need a word in its support.* The exporter of goods from the United States to Europe, must charge from four to eight or nine months’ interest, be * The nearest approximation, if not the only one, to an exception, is lumber, iron, stone, coal, or other articles, transported for ballast on one passage by sea, where the principal object of the voyage is another passage, as coal from Liverpool to New York, and paving or building stone thence to New Orleans, when the main object is the freight of a cargo to Europe. This sort of transportation is of immense importance in respect to commercial conventions with foreign countries, and precisely those in which the wider range of British commerce, and, it is to be feared, the more. thorough statistical knowledge of British statesmen, enable them to get the advantage of us. I 31

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PROPOSITION XIII. tween the time of paying for the goods here and realizing the proceeds there. He must also pay commissions and premium of insurance. If the article is earried merely for ballast, therefore, and not to make freight, he must sell it from five to ten per cent. higher than he bought it, in order to get back his money. This supposes that the ship is going to Europe for another object, say for a cargo. The shipper also takes into the account the rate of exchange; namely, if the rate on Europe is two per cent. above the actual par, and it will cost him one per cent. to send out specie, he can send out goods instead of the specie, if they net him in the European market, in specie, one per cent. less than they cost him in the United States, including interest and all charges. In general, no merchant will ship goods to a foreign country unless he expects to realize net cash proceeds exceeding the cost, taking into the account the rate of exchange. This proposition is plain, and the plainer the better; and I put it down here, not to be proved or explained or illustrated, but merely to be remembered. Formerly, opium and furs were the principal articles, worth more in money, in India, than in the United States. But money was then, and is now, worth more there than here, in silks, teas, and divers other articles. The quantity of opium that could be brought into the trade was not enough to pay for all the silks, teas, saltpetre, etc., needed from India, and we, therefore, sent out great quantities of specie. The balance of trade was immensely in favor of India. This, the freetrade political economists say, and pretend to demonstrate by a misty dialectical process, was as advantageous to the country as any other trade. But those who have formerly witnessed the agony of our commercial community when an Indiaman was being fitted out, with four or five hundred thousand dollars in specie, the banks 32

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PROPOSITION XIV. stopping discounts, and interest rising to the rate of twelve per cent. or more per annum, will require something more to satisfy them that this was highly advantageous, than the mere say-so of a speculative professor, who concocts abstract theorems of political economy in his closet. Now there are only certain descriptions of productions of the United States which bear a lower money price here than in any foreign country, and only such can be exported to any such country. And many articles produced by us, bearing a lower money price here, cannot be exported to any country without loss, either on account of the kind, or because the expense of exportation would exceed the difference of price.

XIV. How much a foreign country will take of our ex ports - There is a limit to the quantity - We cannot dispose of enough exports abroad to pay for an un limited quantity of imports - Free trade assumes that we can. It is modestly assumed by free trade, that we can export, and can sell in foreign markets, a sufficient quantity of our own products to purchase whatever amount we desire to import and consume of their products and manufactures. The freetrade thinkers say it is better to cultivate potatoes, beans, peas, corn, wheat, cotton, tobacco, and rice, and produce beef and pork, and make butter and cheese, to send abroad for sale in foreign markets, and with the proceeds purchase all our steel, iron, coal, and all of our fabrics of wool, cot ton, and hemp, and all the fabrics we need of wood, metals, and leather, except the very rudest and coarsest.

This is assuming and taking for granted that we can export and sell enough of the former abroad to purchase what 33

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PROPOSITION XIV. we want of the latter. Do they prove this? Not at all. Do they show it probable or possible? No. Do they at tempt to do so? Never.

They do not even say it is so, but implicitly take it for granted, and proceed to recommend to our farmers and planters to raise wheat and cotton, and other products of the soil, and to our merchants to export the same, in quantities sufficient to buy whatever amount we need of the other descriptions of articles. “But,” says the cultivator, “I already supply to the mer chant quite as much cotton and flour as he will pay me a living price for; if I should supply more, he would immediately re duce the price so that I should get less money for more, than I do for what I now sell him. In fact I now have a surplus; and Wisconsin and Texas are already coming in with such quantities as to make the surplus still larger.” But still the freetrade transcendentalist goes on in his monotone, “We ought to send abroad flour and cotton to buy our coats, gowns, and stockings; we get them much cheaper in this way.” “But,” says the cultivator, “What avails the cheapness if I cannot get them at all? If you will shape legislation so that an additional hundred or thousand men or women within the range of my market, that is, in the United States, will find some other occupation than raising cotton and wheat, or making butter and cheese, and so take off a little of my stock, I shall be able to buy the said coat and gown at some rate, and the satisfaction of obtaining them, is much greater to me, than the low price, supposing it would be so, when I should be unable to buy them. Your freetrade is no freedom to me; it is bondage; it is slavery to an hypothesis; it paralyzes me-it binds me down, and then you coolly bid me walk. To me this is not the freetrade system; it is the no-trade system.” The proclaimer of freetrade, and palsied industry, ad 34

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PROPOSITION XIV. dresses himself to our knowledge and experience, in taking for granted that there is ample foreign demand for all the raw products of the soil, that are, or possibly can be, produced in the country. He supposes us to assent to this; for when he advises us that it is exceedingly advantageous for us to employ ourselves in producing certain articles for a foreign market, that is, all the articles which can, by his system, be put into the foreign market by us at a less money price there than by others, he speaks without any practical meaning, and trifles with us, unless there is such a market for our whole mass of surplus products, actual or possible. He offers no fact, and says not one word, to show the existence, or probability, or possibility of any such foreign demand. Unless, therefore, he really himself thinks there actually is, or probably may be, such a demand, he deals with us deceitfully; as he has for these many years been continually expressly told that we do not think so, but quite the contrary, for reasons that we specify; he is accordingly bound by the ordinary rules and proprieties of discussion, and owes it to his own zeal in his cause, and his own reputation as one of its champions, to come to the point, and adduce some facts, or render some reason, instead of unheedingly still going on repeating his hackneyed generalities. If he can give no such reason or fact, as he surely cannot, let him at least express in words the proposition he is constantly assuming, and without which all his elaborate system vanishes. Let him directly and plainly say, that, for the products we must export to pay for the two or three hundred additional millions, which he proposes we shall import, we can find a market in foreign countries, -not a place where they can be given away and lost, but a market, where they can be sold at a price covering cost and charges. Or he may stop vastly short of this. Let him assert, in so 35

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PROPOSITION XIV. many words, that there is a sufficient foreign market for our present existing surpluses, and that he builds up a stupendous superstructure of public economy based upon the verity of this proposition. This would be more honest and above-board than implicitly and obliquely to shuffle in his assumption. The proposition of free trade, which he thus infers, would thus have the verbal semblance of a deduction.

It would pretend to be inferred from something. The logic would then go upon all-fours, in words, though it would have only a false pretence to stand upon; not merely false, but palpably and notoriously contradictory to every man’s experience. If there is an unlimited or an adequate foreign market, at remunerating prices, for all we do or can produce for exportation, then it is not impertinent and absurd for the expounder of the causes of the wealth of nations to recommend to us to devote our growing industry more and more to production for that market. It does not establish his theory, but merely to this extent removes one conclusive objection to it; for otherwise he would be recommending an impossibility.

If such a market exists, free trade, in the sense of the economists, may be the scientific verity it pretends to be, if there are not other objections; but if there cannot be found such a market,- or, if it were found for the time, there would be no certainty, or even the least probability, of its continuance,- then free trade is palpably a fallacy, and the legislator or the voter, who does not favor and promote arts and kinds of industry which will supply a home market for the surplus of raw products which cannot be sold abroad, is a conspirator against the welfare of the country. He is more blameworthy than one who merely does not provide for his own household, for he also studiously and knowingly prevents others from doing so. 36

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PROPOSITION XV. XV. The same amount of capital in a community can, by protective legislation, be made to employ a greater amount of labor than it otherwise would do - Free trade expressly assumes the contrary. Take Mr. Mill’s words for this fundamental of his science, who says, ” Industry is limited by capital.” * This is one of those propositions that is a mere partially-true truism in one sense, and a mere sophism in its only other sense, which latter is the one intended, and it is a fundamental postulate of the system of free trade. Take it away, and you have no such system left. The teachers of this occult science instruct us that capital spontaneously seeks the best channel, that is, the one most productive, most profitable, and most useful to the public; and thus will put into action the greatest possible amount of labor. They have less alacrity in making this last assertion, but they foist it in as you will see, and are forever assuming it; for they are well aware that if legislation can “create,” as they call it, that is, increase the amount of, industry, that would open the question of the advantage of such increase in particular cases; and when such a discussion is once admitted, as of an open question in reference to each particular branch of industry, their science is gone, for the advantages of such an increase, in many cases, as we shall by and by more plainly see, are so palpably transcendant, as to overwhelm, at once, their frail sophisms. Though they are, sometimes, or, at least, some of them, a little squeamish, therefore, in directly and broadly announcing this postulate, they all take it for granted in all cases where it is needful to their conclusions. It is, in fact, one * Polit. Econ., B. 1, ch. v., s. 1. Boston ed., 1848, p. 79. 4 37

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PROPOSITION XV. of their most fundamental fundamentals, though as we shall see anon, they themselves in other places expressly repudiate it. The doctrine as assumed and used in freetrade logic, is, that a given amount of capital can put into action only a given amount of industry, and that it puts that amount in motion as regularly as a weight moves clock-work.

You may let it alone for that; it is one of the inevitabilities of industrial economy. The community is represented as a sort of live mechanism, each living part being adapted and impelled by its nature, to perform its functions in the best possible manner, provided you never mend or regulate it. The legislative part of the mechanism is the only exception, as they tell us. This has a sort of free agency, and is endowed with a capacity to err. Its true function is inaction, nihility, no-function. It is, in respect to industry and production, a sort of angel of death, strong for destruction, otherwise powerless. As long as this is inert, all other constituents of the combination are guided right by destiny, and produce given results, and these are the best possible. This is what the writer in the Edinburgh Review,* before cited, denominates the “normal” state of industrial concerns; for it is, he says, the original state; which means, that it was the state anterior to legislation touching industry; that is to say, anterior to civilization; to wit, in the same condition in which divers savage tribes are still found in this hemisphere and the other. In this way, we are told, you have the maximum results of capital and industry, that is, the greatest possible amount of annual products, so that the only question for legislation, if there can be any, is the distribution of these products be * July, 1829. 38

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PROPOSITION XV. tween labor and capital, and between different sorts of each, and this, according to the demonstrations of the same “science,”

should be as studiously ignored in legislation, as its augmentation. In levying taxes, declaring war, making peace, prescribing judicial and executive powers, and all the acts of government, the effect on the amount of production and on the distribution of the products of industry, must be scrupulously disregarded. Congress may regulate commerce, and provide for the general welfare, if it is done without regard to industry and its products; if the effect on these is regarded, it is a violation of the constitution, no less than of the everlasting laws of nature and of science. Let Mr. Mill give you the doctrine in his own words. He says (vol. 1, p. 80,) ” It long continued to be believed that laws and governments, without creating capital, could create industry. Not by making the people more laborious, or increasing the efficiency of their labor; these are objects to which the government can in some degree contribute. But when the people already worked as hard and as skilfully as they could be made to do, it was still thought that government, without providing additional funds, could create additional employment.” He then gives the instance of a prohibition of an import, that caused the article to be produced at home; and says the government then “plumed itself upon having enriched the country with a new employment.’” And he adds, that although this notion “has fallen into a little discredit in England, it still flourishes on the continent.” You observe that he begins with the proposition that it was heretofore supposed that laws and governments could “create industry, without creating capital.” This is the proposition which he proposes to deny or disprove; if to disprove, it is by his proposition above cited, that industry is 39

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‘ PROPOSITION XV. limited by capital, and can be increased (for that is what he must mean by created) only by the creation, that is, increase, of capital, which is beyond the power of governments. His syllogism stands thus: — Major. Industry can be increased only by the increase of capital.

Minor. Laws and governments cannot increase capital. Conclusion.

Therefore, laws and governments cannot increase industry. This is very transparent logic. The sophism is glaring. The major is what old Robert Burton would designate a “stupend” fallacy. Adam Smith had already said that the same amount of .capital, employed “in the home trade, will give four-andtwenty times more encouragement and support to the in,dustry” than in the foreign trade of the country.* Laws and governments can undoubtedly divert capital into the home trade, instead of the foreign, by protecting the home production, and excluding the import. The expediency of so doing is not the question here. The question is whether laws and governments can “create,” that is, increase, industry, by diverting the employment of capital from one channel into another. This is the question Mr. Mill, in the passage above quoted, was discussing. Whether it is expedient or not, he, after Adam Smith, etc. etc., settles by the let-alone dogma, which, in freetrade science, always comes in, like the supernatural agent in epic poetry, to cut the knots, and rescue the fable. But its function does not reach to this case, the simple, plain question being,Can laws and governments augment the amount of industry put in motion by a given capital? According to Adam * Wealth of Nations, Book II., eh. 5, cited in Soph,isms of Free Trade, by a Barrister. London, 1849. Page 10, etc. 40

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PROPOSITION XV. Smith, they can augment it in the ratio of twenty-four to one. This, it is true, he himself contradicts, expressly or in effect, and by implication, some thousand or two of times, as also his followers; all which reiterations he himself thus cancels and expunges as you see. So Mr.

Mill cancels his syllogism, and in so doing, in effect demolishes his whole freetrade fabric. He commits this demolition, not in large type in the text, like his corypheus, but in nonpareil at the bottom of the page, where, after a formal statement of this fundamental of his ” science” in the text, he says aside in the note, “An exception must be admitted when the industry, created or upheld by the restrictive law, belongs to the class of what are called domestic manufactures.” ” If a protecting duty causes this occupation to be carried on, when it otherwise would not, there is, in this case, a real increase of the production of the country.”

That is to say, his proposition in the text, laid down with so much formality, is true, with the small exception of all the the industry at their own homes. He talks of his exception as applying only to domestic manufactures, “in which no transfer of capital to the occupation is necessary to its being undertaken, beyond the value of the materials and tools, which is often quite inconsiderable.” This specification leaves the exception applicable to the employment of capital in kinds of production constituting a very large and very material part of the industry of every country. The limiting of the exception to domestic manufactures seems to be wholly gratuitous. I can see no distinction between this industry and that in factories, fishing, or mining, or agriculture, and venture to be not persuaded that Mr. Mill could see any such distinction himself. If so, his exception covers every species of industry, and so this fundamental 4*

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PROPOSITION XV. bubble of freetrade “science” also bursts, and vanishes, under his own exception. That the same amount of capital may employ or set in motion a hundred times as much labor in one employment of it as in another, is obvious enough. The support of the workman is of course out of the question, for he must be supported by himself or the public at any rate; and accordingly IMr. Mill puts his support out of the case. Take, for example, a quantity of sand and soda, worth say fifty cents, that can in a short time be used, the one in mortar, the other in soap, so as in the new compounds to be worth twice as much. Use the same ingredients in making a fine block of glass, to be ground and polished for the object-glass of a large telescope, by a skilful person, to be employed upon it for two years or more, and worth, when successfully brought to the proper form, with a suitable surface, some four thousand dollars. Here is a practical instance, of four thousand (or, if you please, reduce it to one thousand, one hundred, ten, or two) to one, in the labor employed by the different uses of given materials; that is to say, of the same amount of capital. But, says the disciple of free trade, “You must not choose between these uses. The making of glass will spring up spontaneously at the proper time in the suitable places. The introduction of mirror-glass making into France by Colbert was a violation of the first principles of the ‘ science’ taught at our colleges with the other sciences, and perfectly understood by the young gentlemen. It was as absurd as the foundation of the Smithsonian Institute would have been, had it been founded by a legislative provision. It is for the diffusion of knowledge; but such diffusion is of no utility, if the knowledge, when diffused, is sterile, and does not show itself in arts and civilization. Its object is 42

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PROPOSITION XV. the promotion of the arts, and these should be left by legislation, at least, to spontaneous germination.” Let it be so, then, for the present, (for we have considered this theory of spontaneity under another head,) the question now in discussion being, whether the amount of industry, that can be employed on the same capital, is fixed and invariable, or may be varied and augmented,. or diminished, by legislation, and also by other causes visible everywhere. The fact that legislation professes to affect arts and their products, and always has done so, and inevitably must forever continue to do so, has already been shown under former heads. I will venture to persuade myself, also, that it has been shown, that, where it is intended to promote arts and industry, it is more likely to have that effect than the contrary, supposing the legislators not to be persons non cornpotes mentis. It can encourage and bring about the introduction of an art, orthe improvement and extension of one; and by so doing, can enlarge our own, and in some cases the foreign, market, for the products of our industry. If it has these effects, it may, if judiciously brought to bear, augment industry. This is beneficial to those whose only capital it is, for greater demand for employment is thereby induced. It is beneficial to those who possess any capital in stock or tools, money or land, for it gives a demand for the use of them, and tends to accumulation, the eventual result of which will be the reduction of interest on loans, whereby greater facilities will be given to those enterprizing men, who, having inadequate capital of their own, depend, more or less, upon loans to put in motion the industry of the country. All industry, and, with it, all capital, will be thus benefited.

We are, then, fully authorized to appeal from Adam Smith and his school, when they decree ex cathedral to the 43

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PROPOSITION XV. contrary, to the same judges, when they say, that industry can be augmented by laws and governments, and add also, that it is one of the prime functions of legislation to augment it.* * There is also a dogma of the freetrade sect about capital and industry, which, though in another form, is identical with the above, viz.: that there cannot be a surplus of capital, over what will be productively employed in industry.

It follows from this, that all the capital lent abroad, from Great Britain, and sent abroad for investment in mining etc., causes a proportionate deduction from its productive industry. I pass over this phase of the dogma as not immediately material to my subject. While I was writing the above section, a book entitled “Sophisms of Free Trade,”

recently published in England, came to my hands, which I recommend to all professors of free trade as a demonstrative exposure of some of the sophisms which I have examined. The following is a quotation from it: “Suppose England to manufacture, from English materials, gloves to the amount of a million sterling a year. “This million sterling does, as we have seen, two things. First, it affords net annual income to that amount, available (every farthing of it) for the support of the population.

Secondly, this million sterling creates a market to that amount for other English products. The whole million is every year feeding, clothing, and lodging men, women, and children, and at the same time, finding a market for cottons, woolens, hard ware, corn, iron, timber, silk. When an industrious population are employed, they not only enrich the whole community to the extent to which they themselves are enriched, but by the market which their prosperity affords to other industries. When Manchester is in full employment, what a market does Manchester itself afford, not only for other articles, but even for its own productions! “Now change the supposition. Suppose that French gloves can be imported cheaper by five per cent. than English gloves can be made. It is the immediate pecuniary interest of all consumers to buy French gloves instead of English ones, and they will be bought accordingly. We will even suppose the French government to allow the French gloves to be bought by the very same English cottons, woolens, hard ware, corn, iron, and silk, that bought the English gloves before; nay, we will go further, and admit the extravagant postulate, that all these English products could, in exchange for the French gloves, find as good a market in France as they formerly did in England. Now take the account. Let us see what individual glove-consumers have gained, and what the English nation has lost. “Gloves have in the aggregate cost those who wear them less money than before by 5 per cent.

on a million sterling, that is, by 50,000O. Glove-consum-iers have gained by the change 50,000 in one year. But the nation has lost in the same year the nmillion sterling which used to maintain Englishmen with their wives and children. Englishmen, as a body, have, by the chanrge, lost a revenue of ~950,000 a year. 44

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PROPOStTION XVI. XVI. We have more labor ofered, and can supply more products of labor, than there is a demand for at home and abroad-We have a surplus of labor -Free trade says we have no surplus. Another proposition taken for granted by the advocates of free trade, is, that every man, woman, and child in the community has full employment. In respect to this, as to the other fundamental propositions essential to their single comprehensive dogma of let alone, they beg the question, or rather proceed as if there was no question. They say, “If you employ persons in a new industry, you take just so many from an old one already in practice.” If you are a freetrade man, you will have said to yourself at the end of the last sentence, “This is a selfevident proposition, no more to be proved or denied than an axiom in geometry;” but, hold a little; not so very selfevident. “But this is only part of the mischief; for though their revenue, their subsistence is gone, the English men, women, and children remain, and must be supported by public charity. “But we have here given the freetraders the benefit of three suppositions, no one of which is true. We have conceded, first, that the French government would allow the free import of as much English produce as would entirely pay for the gloves; we have conceded, secondly, that all this English produce finds at once as ready and good a market as it did at home; we have conceded, lastly, that there will be no exportation of the precious metals, depreciating prices, appreciating the currency, and augmenting the pressure, not only of taxes and public burthens, but of all debts and private obligations. “But if these concessions are not true, then, in addition to a million a year, lost as revenue, formerly supporting men, women, and children, you lose a market also for other productions to the extent of a million a year, and are subject to all those numerous evils that afflict industry, when there is a tendency to the export of the precious metals. “Nor does the mischief stop here. Other commodities which have lost their market will to that extent cease to be produced. And by that cessation not only will the subsistence of the people to that extent disappear, but other markets will be injured, and so the mischief will go on and be felt through every grade of society, and in every department of industry.”-Sophisms of Free Trade. Lond.? 1849, p. 24? etc, 45

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PROPOSITION XVI. You say that the hands that have now within a few years been put to making fringed shawls, and rolling railroad iron, and manufacturing any part of the long catalogue of apparatus and machinery used in either, were taken from cultivating wheat or cotton, etc. Now our population is annually augmented by the excess of births over deaths and by immigration, nearly three per cent.; and the three new hands to a hundred, thus coming in each year, may have been put upon the fringed shawls and railroad iron, so as to have taken none from the wheat, cotton, etc. The present annual increase of population is, by this rule, over six hundred thousand. Here is an ample supply of new hands for making the shawls and railroad iron, and for much other newly introduced industry.

This rate of increase of our population, though not selfevident, rests upon evidence not to be disputed. Allowing, then, that half of this increase consists of effective laborers in divers employments of the wits and hands; the other half being children, aged, and infirm; these three hundred thousand may be put to new species of industry, without diminishing the number occupied in the old. I do not, of course, suppose that the precise three hundred thousand who come into the departments of useful industry during the year, will go over to the new industry, for very many of the workers are continually changing from their employments, to other kindred ones. A new form of production can, then, be prosecuted without making any vacancies in those previously practised, But it may be said, that, as the population increases, an additional number of hands is needed in the existing kinds of industry. This will depend upon whether those already in some of those kinds, can more than supply the market, both foreign and domestic, even if it is enlarged as much as it po. 46

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PROPOSITION XVI. sibly can be; that is, whether there is full employment for all, who are able and disposed to work, in all the useful branches of industry; and whether there is, or is not, a sur plus production in some branches already, so that an additional production would be a loss to the producers, and, in-effect, a waste to the community. Is a surplus of laborers, or of domestic products, possible? If there is a surplus of laborers, - that is, if there are more persons able and willing to work, at all times, or any time, than can find employment at reasonable wages, or if there is an adequate supply of all articles, and a surplus of many, then you have a case where new kinds of industry may be introduced without withdrawing workmen from those others, without calculating on the increase of population. It will be immaterial whether the surplus be of laborers or products; if the former, then you have persons already waiting to be set to work; if the latter, you have those just about to be out of employment; for if there is already a surplus of any kind of production, then there will, as soon as this is felt, directly be a smaller number employed in it. If you are one of the worshippers at the freetrade shrine, you have just this instant said, “Yes, here it is; you have hit it; the evil cures itself; if there is over-production in any branch, less capital and fewer persons will be employed in it; this brings all right again. This is, therefore, a matter about which neither the legislator nor the philanthropist needs to trouble himself.” Were we discussing the subject together, instead of my writing down what you would say, it would not surprise me if, when you had said, “The evil cures itself,” you should go off satisfied that the matter was settled too plainly to admit of anything further; or if, haply, you had some latent suspicion of a fallacy in this commonplace axiom, you might go on uttering much phraseology, all 47

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PROPOSITION XVI. amounting to the same thing, to wit, “Let alone, the evil will cure itself;” in so much that any attempt, by suggestion or expostulation, to stop at the question, whether this infallible specific is really the best or only remedy, in all cases, would be quite hopeless.

But as it is, we can stop here a moment. What, then, is there in economical evils and distresses that distinguishes them from all others?

Why can we say that the evil of a deficiency of production, surplus of labor, or any other disturbance of industry or trade, will work out its own remedy, any more than that a wounded limb, or an aching tooth, will do so? The Irish are suffering the evils of deficiency of employment, and of the consequent partial distribution of food, and other products, so that many can obtain only enough to protract the agonies of death. “Let alone,”

say the professors of the freetrade school, “the evil remedies itself;”

that is, the people die. In Cromwell’s time, the Dutch had got the start of the English in the carrying trade, and carried for them as well as for others. “Let alone,” say Adam Smith, etc., down to Mr. Treasurer Walker, who would have said, “the evil will cure itself.” But Cromwell and his Rump Parliament thought it safer to cure it themselves, and so passed the Navigation Act; by the operation of which they drove the Dutch out of, not only the carrying for themselves, but also that for other nations. In 1820, the French, by means of their discriminating tonnage duty, were taking to themselves the whole carrying between France and this country.

“Let alone,” the Scotch economist would have said, “if the French miss the true doctrine, so much the worse for them;” but not so our Congress of that time, which passed a countervailing law, immediately on the case being represented to them, and brought the trade 48

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PROPOSITION XVI. back to our shipping. That was before the drivelling policy of the present time had taken possession of anybody’s brain. Nobody said, if you pass this law the French will exclude your cotton, tobacco, rice, etc. etc. from their market; and if any one had been poor-spirited enough to have said so, none would have heeded him. They knew then, and all who are not infatuated with some single idea or dreamy hypothesis, now know, that we have a decisive advantage over other nations in contests, by regulations relative to commerce, on account of the nature of our exports, sec onded by our skill and enterprise in navigation. Though it may not be wise to push this advantage to the utmost, it is rank folly to throw it away. The act of Congress referred to, you say, was to counter vail a regulation made by the French government. True, but what is the distinction, whether the disadvantage you are providing against arises from the commercial regulations or the social condition of a foreign country? If the effect is to check, restrain, embarrass, and suppress your own productive activity, this is sufficient reason for providing a remedy, from whatever cause the evil arises. This is enough to be said here on the dogma that economical evils remedy themselves, as it is only one of the forms of the let-alone doctrine, which has already been sufficiently noticed. Leaving alone, then, the dogma, that the evil will cure itself, we return to the question whether it can exist. Can there be in a community more persons able and ready to work, than can find employment? I do not here or elsewhere, in speaking of labor, work, or industry, mean merely manual labor, but all sorts of useful work, muscular or mental, or a combination of the two; and they are usually combined, in all occupations, though in different proportions. 5 49

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PROPOSITION XVI. Can there be in a community a superfluity of minds and hands in want of employment? And can there be a superfluity of products of labor, over and above the quantity demanded for consumption or use? The freetrade economists, as we have seen, take for granted that neither of these superfluities exists, when they say, that if you put more hands into an existing employment, or direct them to a new one, you take just so many from some other. Adam Smith said so, and it has been repeated to the present time by his school. They go into no data to establish this proposition; and yet, if it is false, it unhinges their whole system of public economy. Their “science” must go down with it. If superfluity of laborers or products is possible, their proposition is false; not merely possibly or probably, but demonstrably false. And shall I go about to satisfy you that one of these superfluities may possibly sometimes exist?

What else do we see in the newspapers, and hear of in all the resorts of men of business every day? The moment a new territory offers inducements for emigration, or a newly introduced or extended branch of industry offers employment, thousands flock to it, and fill the chasm, without causing any perceptible one elsewhere. The abundance of animal life and means of its sustenance, gushing forth in an advantageously circumstanced well-governed community, as in the animal and vegetable kingdoms generally, is inexhaustible. The dull old prosing about paucity of workmen and dearth of capital, and the multitude of impossibilities that stop industrial progress, is not applicable to such a people, if it is to any one. In the United States there always exists, except at occasional short intervals, a superfluity of both workmen and products; that is, we always have hands for the extension and introduction of branches of industry, and always have on hand a stock of 50

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PROPOSITION XVI. our productions for the supply of any new market that offers, and, at the same time, millions of dollars worth are annually lost without being sent to a market, and millions more are sacrificed in those that are overstocked. In 1846, the crops fell short in Great Britain.

Forthwith, and without any expectation of an extraordinary demand, we sent abroad $40,000,000 worth of provisions to fill this vacuum. In 1848, a sudden demand arose in California for some 30,000 or 40,000 industrious persons, and for some millions worth of supplies for them, and both men and supplies were forthwith despatched. A single advertisement for a laborer in any useful employment, will immediately bring a multitude of applicants; while, on the other hand, an advertisement of articles for sale will frequently, as we witness, bring no purchaser. If you are not satisfied by the evidence daily passing about you of labor wanting sufficient employment, and products of labor wanting a sufficient market, any more would be lost upon you; if you are satisfied of those facts, then you must approve of the legislation best calculated permanently to give additional employment for our own labor, and additional demand for its products. The proposition in hand, viz., that there may be more labor able and ready to be employed than can find employment, and more products of our labor on hand than can be sold at a remunerating price; this, I persuade myself, you are willing to subscribe to; and, if you do, you cannot hold to the doctrines of the freetrade school; for this being admitted, that system caves in. 51

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PROPOSITION XVII. XVII. In legislation, regard is to be had to the future as well as the present -Free trade considers only to-day. It has already been said, that, in traffic, men necessarily have to look to the present price. They produce what will give them the most money for their work, and purchase where they can, at the time, get most for the same sum. Very few have capital enough, and fewer an inclination, to carry on a business at a present loss, expecting, by degrees, to make it profitable. If one is adventurous enough to undertake to do so, he can expect to follow it up but for a little while; and such an attempt is hardly to be looked for at all, much less to be so on a large scale for a long period. All the world act upon the contrary system of making their industry, whether it be in production or traffic, of the great est immediate pecuniary avail, and are not over-ready to sacrifice the present for the future, even where it is dictated by interest or duty. Life is short and art is long; and this proverbial truth is applicable to our subject, for it is a long process, involving many experiments and many failures, to introduce and domesticate any art, even onre apparently so simple as the making of a button. It is now thirty years and more, since an ardent zeal for improvements in agriculture and horticulture has prevailed in this country, and been constantly spreading, and growing more intense, and yet we are but in the rudiments of the science of this first and greatest branch of industry, though it is happily not very subject to be affected by foreign pauperism or bad legislation at home; by reason of the expensiveness of freight, or the perishable nature of most of the products, this industry enjoys all but the exclusive possession of the domestic market. Since, therefore, every nation has to serve a long appren 52 I

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PROPOSITION XVII. ticeship, and learn much from others, and discover and invent many improvements for itself, before attaining to great proficiency in any art, it is a great advantage to be in advance of competitors in time, in so much that British writers, estimating their useful arts to be at least twenty years in advance -of those of all other countries, calculate upon this superiority, to bear them up, and bring them off triumphant in every comnpetition.* They accordingly cry out for free trade, which is no more nor less than a challenge to all the world at the game of competition, upon the conditions ” heads I win, tails you lose;”

for if they prevail, they take our own market from us, if we prevail, we lose the cost of the struggle, though we keep our own market. We plank the whole stake; if we win it, namely, our own market, we are just where we were, the only contest being whether we shall lose it. Some of our chivalrous contemporaries of the north and west, and still more of the south, are eager to engage in this game upon these terms, some perhaps for the honor of a triumph, of which their high-wrought patriotic estimate of our strength and skill make them certain; others, probably, especially those of the South Carolina nullification school, out of sheer hostility to northern industry, which they are not unwilling to injure even to the prejudice of their own; and a still greater number from an innate proneness to dupe others, or be themselves duped, by metaphysical abstractions and fallacies. It is a singular fact that the English freetrade economists, excepting the supertranscendentalists, fight for their alleged faith, because they think it will infallibly promote their own arts and industry, while many of their American neophytes Edinburgh Review, July, 1849. 5 53

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PROPOSITION XVII. go for it, because they hope it will depress, and eventually annihilate ours. But to return to our present subject, you will, I persuade myself, admit, without an argument, that the producers of materials, as well as those who work them into all their forms, useful and ornamental, for distribution, trade and consumption, and those who transport, buy, or sell them, are determined by the present money price, that is, they produce and make what they expect will sell for the greatest money price, compared with the labor and cost, and buy at the shop where they can obtain the same thing at the least present money price. Suppose twenty or a hundred thousand persons knew themselves fated to live a century or more, and remain together in a community by themselves, in the same social relation, and mutual dependence upon each other, and with mutual help or harm. Let them see that they possess in their own position and territory, and, what is more material, within themselves, in their own character and habits, certain industrial resources and capabilities, which by mutual co-operation and exchange of commodities (that is, protection) can, in the course of a few years, be developed and brought into as successful activity, as any similar resources and capabilities of any foreign community. They would see that, in the mean time, each one would have the advantage of sure customers in the others, and so be sure of steady employment in supplying them, and thus the certain means of supplying himself from them in turn, instead of beating about the world in search of a customer, and often not finding one; and sometimes getting very small proceeds and returns, and at others, not any, to supply his own wants. It would not be strange, if in these circumstances, they should enter into some stipulations for mutual assistance and encouragement 54

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PROPOSITION XVII. for a number of years to come, and thus, for the present, secure to themselves the essential and vital requisite to wellbeing, namely, full employment; and also, sooner or later, the secondary less material, but still important advantage of a productiveness of their labor equal to, or greater than, that of other communities. But as things are, in this and like cases, men cannot personally make such stipulations among themselves, looking into the far-off future, and, therefore, they enter into political associations, and constitute governments to express by legislation, at least, those regulations for the everlasting community, which it would be for their general interest to make individually, even if to continue but for one generation. This is not in the nature of restriction or coercion, in a country where the legislative acts are an expression of the general opinion and interest.

Some stolid German peasants, or wild Irishmen, just come over, regard the government as their enemy, and the law as hostile, both here and elsewhere; whereas, it is, in fact, with us, what the majority agrees to.

Every law promoting domestic industry, therefore, amounts merely to this, that the workman or person employed, in whatever description of useful labor, says to the owner of the workshop, the factory, or the field, “I will work for you at such a compensation, being twice that paid for the like employment in England or France, and take my pay in the articles made in your shop or factory, or produced on your farm, at the lowest price at which you can afford so to make or produce them,” to which the other side agrees. This expresses all that is meant by a protective tariff. The person employed says to his employer, “If you will protect me against the competition of the foreign pauper-laborers, I will protect you against that of their foreign employers. 55

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PROPOSITION XVII. I take my chance against competition by American laborers, you take yours against competition by American producers or mamlfacturers. If everybody takes the products of the foreign laborer, then the American laborer, whether Irish, German, or Yankee, must of course be idle and starve, or must finally work at as low wages as the English or Dutch laborer abroad, which is the next thing to starving. And if the foreign products are let into our market without discrimination, you must shut up your shop or factory, or convert more of your land into a sheep pasture, or let it run to waste. To avoid these alternatives, we agree to favor each other.” This is the protective tariff. But the freetrader steps in, and says to the American laborer, “What is the American cultivator, master-mechanic or manufacturer, to you, more than the English or Dutch?” And to the latter, “What is the American laborer to you, more than one in England or Holland?” Trade knows no such distinction as kinsman, neighbor, or fellow-countryman. Buy wherever you can; get a thing at the lowest present money price. In business we are all foreigners and strangers to each other.” Be it so, for I am not inculcating gratuities and acts of mere generosity; but there is at least this one difference, namely, that being members of the same community, and subjects of the same government, we can, through that government, as our common representative and agent, make stipulations, compromises, and conditions with each other, which are not practicable, and cannot be depended upon between us and persons subject to a different jurisdiction, and residing on the opposite side of the globe; who may some day find it to be their bounden duty, as good patriots and good subjects, to burn our capital, sink our ships, batter down our fortifications, and plunder, and rob, and kill us. Any stipulation or mutual dependence between 56

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PROPOSITION XVIIT. these latter and us, supposing it to take place, is less to be relied upon than the agreements and relations, which we enter into among ourselves, through our own legislation. Through this, we can secure to each other, between and from each other, more advantages than we could possibly secure from all the nations of all the world besides, supposing them all to forget their own peculiar interests, lay aside selfishness, and adopt precisely the regulations, and pursue the kinds of industry that we should recommend. Our country is not a mnere little commercial district, it is wide, and presents an immense variety and amount of resources. This advantage possessed by us, owing to our peculiar position and circumstances, combined with the character of our people, we are invited and urged by the freetrade advocates in England, and their American associates, to cast away wantonly, in order merely to lighten the burthen of British pauperism, and promote British arts. I confess I cannot conceive how any honest, fair-minded American, can embrace a system of legislation on matters of public economy, which, in its fundamental doctrines, is limited only to the present, and supposes national blessedness to consist solely in a present supposed low money price of articles, however idle and poverty-struck the people may be for want of employment, and consequently, want of the means to purchase the articles at any price, high or low. XVIII. A war with some great foreign naval power, at some period, is possible; and may cut off the supply from abroad, of means for defensive or offensive op erations. Another false assumption tacitly made by the advocates of free trade and fettered industry, is, that we are secure of 57

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PROPOSITION XVIII everlasting peace with foreign nations. This assumption is false, and it is not possible that the feeblest understanding can but know it to be so; but it is made notwithstanding. You are a professor of free trade, and, perhaps, deny that you make any such assumption. Then I will convince you that you do make it so plainly, that if you make it hereafter you shall not be able to say that you do not do so knowingly. To be sure if you are operating upon a set of constituents whose faculties are bewildered with the fallacies of free trade, it may go hard to bring you to confess to yourself, but I persuade myself that you will, notwithstanding; unless you are one of those unfortunate political transcendentalists, who talk of demolishing the custom-houses, and fortifications, and giving up the navy yards; who affect great abhorrence of “villanous saltpetre,” burlesque the militia, and deem a military or naval school, to be a mere national blood-sucker. “There be players, that I have seen play,” who do their part thus. Such I do not profess to undertake. But if you think it probable that men and nations will continue to be somewhat similar to themselves, and will probably go as, far, at least, in self-defence, as the Quaker, who, (deeming himself not to be so strictly bound to the letter of the English translation, made under our once gracious sovereign James, of ever-blessed memory, that he must present the other cheek,) took the liberty to hold his assaulter and batterer very hard; if you go, I say, only as far as he, I do not hesitate to count upon your agreeing with me, that the policy of protecting and promoting useful industry by legislation, no less than by other means, is as commendable, and as obligatory on our government, as the building of forts at our harbors, manufacturing arms, and fitting out naval steamers; and if so, then you will also admit that free trade assumes the contrary of all this. 58

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PROPOSITION XVIII. Our postulate is, that there is a possibility in respect to any nation, and in respect to us a probability, that we may somie day have war; and, consequently, if our enemy have any naval force, an interruption of our maritime intercourse with such nation, if not also with others, will follow. We all remember how many naval steamers the British government dispersed over the three oceans at the time of the Oregon dispute. I cannot prove that we shall be liable to war, any more than I can prove that the present laws of nature will continue, but the presumption that we may is certainly very considerable. What is especially remarkable, some of the persons at present most forward to make this assumption, that we shall never have a war, are the very same who were fierce for a war with Great Britain, on the question of 54~ 40. Hlow does it appear, then, that the freetrade professors make the assumption that we are exempt from any liability to war? It is thus: They say, that in levying duties, the raising of revenue alone is to be regarded.* Their explicit meaning is, that when a duty on coffee or tea is proposed, you cannot object that this duty will bear hard upon the poor, to whom these articles are become necessaries of life, and who use a much greater quantity of them, in comparison with the rich, than any article whatsoever, excepting breadstuffs, fuel, and salt; if indeed even these can be excepted. You cannot object that the duty imposed by the same persons in 1846 on certain coarse wools, is greater than on the imported blankets made of similar wool, so that by the operation of the two duties, the * See the messages of our late freetrade President, reports of our late freetrade Secretary, and speeches of freetrade members of Congress, passim. I will not presume my reader to be so little acquainted with the subject, as to need more reference to authorities. 59

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PROPOSITION XVIII. domestic production and manufacture are, in this way of “letting alone,” put under a positive gratuitous disadvantage in competition with the foreign. You are bound, you say, by the Constitution, to ignore those considerations. That instrument nowhere expressly provides that you may adjust the two duties, so that they may help, and not depress our own industry and arts. The protectionist says, “You may so levy the duties as to promote our own industry,” the freetrader, the contrary.

This is one of the two fundamental points of difference. “My pope, my priest,” says the bigot; “My conscience,” says the hypocrite; “The Constitution,” says the partisan, when one or the other asserts a proposition that is an outrage upon common sense. Our freetrade compatriots of South Carolina are among the very chivalrous champions of the Constitution. The framers of that instrument little dreamed to what systems of hermeneutics they were giving occasion. But whether the proposition be derived from a vacuum in the Constitution, or the destiny that predominates over mankind, or whatever other source, true it is, that the free4rade people lay it down as a fundamental principle of public economy, that in levying the revenue, you must scrupulously think of nothing but levying it; that is, I suppose, how to get most. This seems to be the one idea conveyed by the proposition, according to Ex-Secretary Walker’s politico-economical report in 1848. If the proposition does not go so far, it, at least, goes the length of asserting that, in levying duties, the government must not have any, even the remotest regard to the effect upon the useful arts and industry of the country; for it is in this specific application that it is laid down. We have then made one step. Our next is, that the mode of levying the revenue does, in fact, have some effect on our arts and industry. It is admitted on all sides, that 60

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PROPOSITION XVIII. the levying of a duty on any kind of import, tends to promote the domestic production of the same article; if it be one to the production of which, our soil, climate, and the character and habits of our people, are adapted. Again, we know very well, that certain articles are neces sary in carrying on a war. As the art of war is at present con ducted, we need, for that purpose, guns, gun-carriages, small arms, powder, balls, armed steamers, armed sailing vessels, tent-cloths, clothing, and food for those engaged in the pub lic service, with other things too many to be enumerated; and, also, all the materials and articles that go to the con struction or manufacture of those. We also know very well, that our soil, climate, and the enterprise, ingenuity, skill, and activity of our people, adapt us to the production and manufacture of all the most important materials and supplies requisite in war. These articles are of a kind that we have as good means of pro ducing, and we can, in general, produce them by as few days’ labor, at least, as any people on earth, as soon as the production is well established, and steadily conducted, in a domestic market not liable to be flooded every four or five years, in time of commercial plethora, with the remnantsand surpluses of all the factories, and shops, and work-houses of all Europe. But, says the freetrade statesman, “We must admit all these as freely as possible, and, for this purpose, reduce the duty half, if it will double the imports, and three quarters, if it will triple them, and so on, as long as we can, in this way, augment or maintain the revenue. In levying the revenues, we must have an exclusive regard to the amount that can b e raised. We must consider nothing else. It is true, that I say on other occasions, we may regard cheap 6 61

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PROPOSITION XVIII. ness in the present money price; but this is an exception to my rule.” We may expostulate with him, “My dear sir, pray reflect that if your powder and shot must come across the ocean in time of war, your enemies’ ships may intercept them. If you have depended on your enemy, in time of peace, for clothing and shoes, your soldiers may, in time of war, be reduced to make bloody tracks upon the frozen ground, as was the American army, in 1777, in their march from Princeton to Morristown. Or if you depend upon the enemy to furnish the blankets stipulated by treaty to be annually supplied to our Indian tribes, you will be under the necessity of violating your treaty in time of war, as our government did in the war of 1812. And then, if you get up the necessary workshops and factories, increase your flocks of sheep, put your people to practise strange trades in a rude manner, etc., for supplying the necessary wants of the whole community during a war, as well those in, as those out of the public service, the whole population will suffer very great distress, and be put to great saecrifices, before these supplies can be thus got ready. Your war will be greatly protracted for want of means to prosecute it; and if you should not, from this cause, in the end, be beaten, the expenses will thus be immeasurably enhanced. Besides aU this, your outlay, reckoned in the money price at the time, or in any other way, to supply, pro tempore, and but poorly, the common necessaries and conveniences of life, will be enormously aggravated. And, finally, when peace comes, and a free intercourse is again opened with the foreign factories and workshops, and huts and work-houses, to which you propose, forthwith, again to resort for the articles of common necessity, as well as for defence, you would inundate the country by a flood of the foreign articles added 62

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PROPOSITION XVIII. to the stock of similar domestic ones on hand, and thus cause, for a period, that great national felicity, a low money price, followed by a general commercial collapse, with ruin of merchants, artisans, and manufacturers, stagnation of agriculture, and loss of employment to laborers, strewing the country with the decaying remains of the buildings, fixtures, and machinery, hastily put up to meet the general wants during the war. This picture is historical as well as prophetic. It is precisely what happened after the last war, when the high duties imposed during it, ceased; and what would happen after the next, were we to be transformed by free trade, into our former chrysalis state in respect to the useful arts. “All these consequences necessarily follow from your grand let-alone specific for boundless prosperity, to come some thousands of years hence, when the Czar of Russia, and all other potentates and legislators, have conspired to convert the world into a commercial paradise.” You reply, perhaps, that you “vote for building fortifications, and arsenals, manufacturing arms, maintaining military and naval schools,” etc. Good. Then you contradict your doctrine by your own acts, for your doctrine is, “Let alone; individuals will find out what is for their interest; and what is for theirs, is for that of the aggregate;”

from which it would follow, that individuals enough will discover it to be for their interest to study military and naval tactics, and the art of fortification, and provide stores of guns, shells, Congreve rockets, swords, pistols, and the like, ready for all emergencies. “No,” you say, “these are exceptions to the rule.” Do you admit this? Then you are a protectionist, and not of the sect of free trade. The economist, J. B.

Sayv, goes as far towards an excep 63

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PROPOSITION XVIII. tion of new manufactures, meaning, of course, those for which any particular country is adapted, as to say, “perhaps,” etc. If I am not mistaken, others of the same school, though not without some misgiving, venture upon a like departure from the let-alone dogma. If you add to these two exceptions, the doctrine that, when the country undertakes to promote and protect a branch of industry, it must, as a general rule, adhere to its undertaking, you have the entire protective system. But if you admit only the first, you are substantially a protectionist, for if you will, in your mind, run through with a list of those articles of wood, metal and other minerals, wool, cotton, hemp, and leather, which are essentially requisite in national defence, and for the domestic production of which our soil, climate, and the character, habits, and the industrial capabilities of our people especially adapt us, and admit that the home production of these is to be encouraged by legislation, you will find yourself a protectionist, and can never again repeat the let-alone and other dogmas of free trade. You reply that you are in this case “only a protectionist in degree, and sub modo.” So be it.

You admit the expediency of favoring domestic industry to some extent, and for some purposes You are then a protectionist. The only question between you and other protectionists, is, to what articles, and in what degree, encouragement is to be given? This is a fair subject for discussion, whether the question be the means of defence and independence in time of war and peace, or the promotion of the welfare of the people, by multiplying and extending the arts, and thereby consequently supplying to them more employment, and thus also sustaining the rate of wages, in useful trades and pursuits. The moment you enter upon these inquiries, you cease to be in 64

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PROPOSITION XVIII. the freetrade ranks; and are not one of those with whom I am at present discoursing. I am addressing myself to you other persons, who say, Let alone; the individual motive of profit from the present money price, left free of all attempted influence from the government and the laws, will infallibly work out the greatest productiveness of labor, and the utmost possible national progress.” This is your doctrine, which you inculcate without qualification or exception, and affect to practise upon, though, as I have already shown in a preceding article, it is not possible to apply it practically in any civilized community. It is only the Ojibewas, Pawnees, and other savage tribes, that do really, or can, act upon the freetrade system. In any community, governed by any system of permanent and regularly administered laws, you may, by professing and pretending to do nothing whatsoever in legislation to promote and protect industry, in reality take the most effectual measures you possibly could, to depress it. For this is one of those cases where it is impossible to be neutral. The legislator must be for or against. But whether it be so or not, you being of the freetrade school, dogmatically maintain it to be the bounden duty of every good citizen to eschew the helping or promoting of useful industry in any case whatsoever, whether in legislation or otherwise, and that the uninfluenced comparative present money price, is the infallible talisman for keeping off all social and economical ills. This is your science in reasoning, and your creed in dogmatizing. If I am right, then, in the two facts above stated, I have proved that you assume as a fundamental postulate of freetrade, that no foreign nation on which your system might make us dependent for the necessary means of military or naval defence, will ever be at war with us, or liable to have: 6*

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PROPOSITION XVIII. its intercourse with us interrupted by our, or its, foreign enemy. This is the necessary result of the two propositions above stated. One of them is, that if we have not within ourselves adequate resources for supplying ourselves with the means of national defence and attack in war, every war will be incalculably more protracted, more expensive, more disastrous, and more perilous to our social and economical welfare, and national integrity and independence. The other is, that, in your lessons of freetrade, you say that the industry, that is, the destiny, of the country, must be left exclusively to the operation of the comparative present money price, at home and abroad. You do not estimate the probable money price of iron or wool for twenty years to come, under protection and without protection, in peace and in war; taking into account the vast sacrifice made during the war for want of means and skill for home production. The freetrade economists dodge all considerations of this sort. It is easy to see in their speculations where they spy any such objection ahead, and studiously shy it. If one suggests it, they can’t hear, their minds are so full of “let alone trade.” They do not include in the real cost of the exclusive foreign supply of munitions of war, and necessaries of life from abroad, the incalculably enhanced expenses and sacrifices for these during a war. Therefore, what I undertook to prove, is true, viz., that the propagandists of free trade assume as an essential fundamental condition of their theory, that we are not liable to any foreign war that would interfere with our supply of necessary articles from abroad. If they are ingenuous and honest, as they will surely not object to our considering them to be, and really contemplated the possibility of any such state of hostilities, they would certainly bring into the account the sacrifices and dangers plainly consequent upon the adoption 66

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PROPOSITION XIX. of their theory, when reckoning the advantages and disadvantages of free trade or protection. They never do this, and, therefore, we must, in order to maintain an opinion of their candor and fairness, understand them to really believe that henceforward, this country is to be to other nations what the island of Delos was among the Greeks, and what the canal across the Isthmus is proposed to be, a neutral territory, where belligerents shall always meet as friends; and more than this, that our people, and ships, and property, wherever they may happen to be among the hostile collisions and crashes of other nations, will be held sacred and inviolable. XIX. Arts and manufactures do not spring up without encouragement - Disadvantages under which new arts and business labor-Free trade says, “IMfanufacturers would encourage themselves as soon as the country was adapted to them.” It is one proposition to say that any art or kind of production is not to be introduced into a country until the country is adapted to it, and a very different one, to say, that it will spring up of itself, whenever the country is adapted to it. If one should advise that a youth should not be put to a trade until he was old enough, we should assent, but if he were to lay down, as a universal rule, that a youth would, at a suitable age, of his own mere motion, without encouragement or incentive, betake himself to some useful calling, we should directly remember, if indeed we had not too much occasion to regret, instances enough to the contrary. In order to form an opinion whether the arts and manu Secretary Walker’s Report, 1848. 07

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PROPOSITION XIX. aetures to which a country is adapted, will spring up spontaneously, just at the proper time, where foreign producers already have possession of the market; observe the requisites and obstacles to their so springing up. The mere habit of being supplied by the foreigner, has in itself, like all other habits, a tendency to continue. Most men prefer the beaten track, in so much that the good-will of an establishment, that is, the habit of customers to resort to it, is a sort of property, that fetches a price in the market. This advantage to the foreigner already in possession of your market, is worth something to him.

When the useful arts began to take root in this country, about the time of the war of 1812, this advantage to the British and French, more especially the former, amounted to, at least, ten per cent. That is to say, the consumer could not, at first, be tempted away from the foreign article by the mere difference of cost, unless he should save, at least, ten per cent. by so doing. This advantage has wholly disappeared in respect to many articles, those of our ownil production being in quite as good esteem as the foreign; and is greatly diminished in respect to others. In respect to some, the domestic production of which is still recent, it remains in full force. As a general rule, we will estimate this advantage at three per cent. on the proceeds. Whoever makes an article, must have the requisite tools and materials, and pay rents and wages, and charge interest for the time on these outlays. Interest in England, France, Holland, and Germany, is from four, to seven, tenths of our rate. A year is a short time enough, to allow in general, from commencing an article to realizing the proceeds of its sale. Our rate of interest may be estimated at six per cent. per annum, at least. The foreign competitor accordingly has the advantage of three per cent. on this item. 68

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PROPOSITION XIX. Allow wages to be, in general, one third of the cost of the article; and the money rate, in those countries, to be three fifths as much as ours. This gives the foreigner an advantage of thirteen per cent.

A well-organized system for carrying on a business, has very great advantages. All the auxiliary arts concerned in its prosecution, are near at hand; with frequent and cheap communication with the sources of supply of materials, stationary and travelling agents and correspondences, at home and abroad, for distributing the manufactured articles, and forcing them upon the attention of every consumer, civilized or savage, not merely at the commercial centres, but also in the remotest corners and obscurest recesses, where creatures possessed of anything to barter, can be found.

This gives an advantage that may, in general, be estimated at three per cent. at the least. The preceding item is confined wholly to the system of arrangements, agencies, and communications. Another advantage of much greater importance in favor of the party already exclusively possessed of the field, is the organization and skill of his artificers and workmen.

The difference between these, and those newly brought into an employment, is the same as between regularly drilled troops, and militia. “A sort of twist or gimp,” made in Great Britain, “which cost three shillings making, when first introduced, is now manufactured for a penny, and this solely through the increased dexterity of the workmen, without the intervention of any new machine.” This is an extraordinary case, and is, therefore, the more striking illustration of a consideration of momentous import in national economy. The manual dexterity acquired by practice in dispatching a greater quan Edinburgh Review, Jan., 1849, p. 81. 69

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PROPOSITION XIX. tity of work of superior quality, avails much in all employments, and in many predominates for years over competition. The disadvantage of inferior manual skill cannot be overcome at once by importing workmen from abroad. This is the first step. Many foreign artisans come to us from Europe. So we send, from time to time, a company of overseers and operatives in cotton manufactories, to Mexico; and in like manner have dispatched shipwrights and cotton-cultivators to Turkey, and machinists to Turkey and Russia. Intelligence and public spirit, in the governments and their subjects of our times, is doing for other arts, what brutal persecution on the continent, did for the woolen manufacture, in England, in the seventeenth century. But the importation of instructors in arts is an expensive operation. Thus the English engineer first employed on the Albany and Schenectady Railroad locomotive trains, had a salary of three thousand dollars a year, for a service that now costs sixty dollars a month. Then it requires some time to introduce and thoroughly domesticate an art. The imported artist often proves to be unskilful, vicious, conceited, turbulent, or impracticable; and his faults will, perhaps, be aggravated by the jealousy and antipathy of our own natives employed with him, whereby the undertaker is subject to great vexation and expense. When, tbirty years after having emancipated ourselves from the grievous political domination of our unkind mother-country, we began to extend the business of making hats and rude fabrics of other kinds, and dimly conceive the design of gradually working our way out of our still colonial condition, in industry and trade, the discouragement from want of science, tools and arts, seemed to be insurmountable, and would have been really so, but for the great enterprise and energy of our people, seconded by patriotic far-seeing legislators, who did 70

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PROPOSITION XIX. not glory in the degradation of the nation in science, arts, or commerce. But now, after struggling for thirty years, first against European superiority in the arts, and the opposition of those concerned in navigation and imports, and the agents of foreigners, and afterwards the gratuitous jealousy of the large class of cotton-growers, and latterly, the British decoy of freetrade,-thanks to the indomitable genius, energy and public spirit, of our people, we have domesticated among us the rudiments, at least, of nearly all the sciences and arts, and brought many to a good degree of perfection. We have established our equality with the Europeans in many, and are fast coming up with them in the others. The advantage of our competitors in this respect, is still very considerable in some branches. We may estimate it as varying from nothing in some branches, up to ten per cent. in some others, averaging, say, three per cent. Another advantage in a country where any branch of industry is established, is its inventions, machinery, and improved processes. This advantage is not limited to the mechanic arts usually called manufactures, but extends to all the arts, ornamental as well as useful. Witness the improved agricultural implements and vehicles for transport, whether by land or water. The invention of the cotton-gin by Eli Whitney, was the foundation of the transcendent success of cotton-planting in this country, and this instrument, with the subsequent improvements upon it, gives a decisive advantage for that cultivation, over competition in countries behind us in the arts auxiliary to the making of these gins. In England and Scotland, they reckon very largely upon their being able to put down all foreign competition, if admitted freely to the contest, and this confidence accounts for the clamorous declamations of their merchants and manufacturers in favor of freetrade.

Their confederates 71.

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PROPOSITION XlX. in this country, and also those who believe that our commner cial millennium consists in our relapsing into the colonial condition, upon the Canada and Nova Scotia level, join in the glorification of free trade from the same motive. An able British writer has recently presented the great impor tance of keeping the lead in machinery and improved pro cesses. He says: “To the inventive genius of her sons, England owes the foundation of her commercial greatness. We will not go the length of asserting her proud pre-emi nence solely upon the condition of her keeping twenty years ahead of other nations in the practice of the mechanic alrts; but there is no question that a fearful proportion of our fellow-subjects hold their prosperity upon no other tenure.” Here the writer assumes that Great Britain is twenty years ahead of other nations in the mechanic arts, and seems to hesitate whether its commercial pre-eminence can be maintained without keeping so far in advance, and asserts decidedly, that if his country does not maintain this pre-eminence, meaning, indefinitely, without limit of period, the fortunes of a fearfulproportion of his fellow-subjects will be ruined, which, of course, involves the misery and starvation of millions. He accordingly suggests the establishment of institutions for scientific mechanical education, as one of the means of maintaining, and, if possible, carrying still higher this supposed pre-eminence. And yet, in contradistinction of principle to such recommendation, the same writer is, no doubt, strenuous in recommending free trade as the transcendent economical policy for every other country, and he may be the author of some of those volumes, coming out to us one or two a year, to persuade us how surpassingly for the benefit of all the world in general, and the United States in particular, will be that same system. Edinburgh Review, Jan. 1849, p. 81. 72

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PROPOSITION XIX. Such is the view of able British writers on the subject of the advantage enjoyed by a nation through its pre-eminence in improvements and inventions. As far as we are concerned, however, there is one very considerable se-off. A leading country is apt to become extremely conceited and arrogant, so that its whole industrial corps, from the undertaker and superintendent down to the rudest laborer, will consider their methods and processes perfect, and regard others as hardly worthy of attention; whereas the prejudices of the younger competitor are not likely to be so stiff. And if he adopts all the improvements of the leader, and adds some of his own besides, he will, in the end, himself become leader in his turn. He has the greater facility for the purpose, by reason of his not having immense investments in structures and apparatus, suited only to the accustomed methods. This advantage of Europeans over us in matters of inventions, machinery, and improved processes, varies exceedingly in different branches. It has wholly ceased in many extensive species of industry, and is being fast overcome in others. One obstacle in the way of our more rapid progress in this particular, is the difference of language between us and the French and Italians, which keeps us from a familiar knowledge of an infinite number of arts and devices of theirs, connected with personal accommodation, elegances and ornaments, well adapted to our condition, which, if we spoke a common language, we should be more ready to adopt, with suitable modifications, and, sometimes, improvements. If we look at particular branches of production to which our country, character, and condition, invite us, the advantage in question, on the side of some foreign producers, over us, will be a large percentage, but if we spread it over the whole 7 73

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PROPOSITION XIX. circle of products of labor and skill, it will be quite inconsiderable. Let it be estimated at two per cent. Another vantage-ground of a country of highly improved arts, is in its establishments, formed for the production of particular species of articles in immense quantities. Such can only be raised up by the help of a great market, domestic or foreign. In an extensive and populous country the former depends solely on the policy of the government, the territorial resources, or the character of the people, and is beyond the reach of every foreign power, except one that can dictate, as Great Britain does in Portugal. The United States will present an immense market for all vendibles, as long-as ambitious agitators for dissolution do not split us up, and free trade does not cripple our industry, and make our productive capacity dwindle away, so as to employ our people but a small part of their time at reduced wages, yielding only the rude products of the soil and the arts thereby scrimping consumption in like proportion. There is some limit to the advantage of a great production in inducing economy, and reducing the cost. When you once have divers successful establishments in active competition; as in the making of shoes and of nails in the United States, in each of which, business is conducted on so large a scale as to carry the division of labor to its utmost limits, and afford every one full employment; the inventive faculties of the artisans, being, at the same time stimulated to the utmost stretch in making improvements, and devising new processes and combinations, nothing more can be done towards promoting productiveness, cheapness, and perfection of work. But suppose the market for any such establishment to be confined to the country in which it is situated, say in this country. For such one, let there be four similar ones in a 74

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PROPOSITION XIX. foreign country, say Great Britain, whose market is not confined to that country, but extends also to this, and to Asia and Africa, South America, and Australia. Let each of the five establishments be able to produce and afford the same article, of the same quality, delivered in this country, at the same price. Then suppose another ease, namely, that the one establishment in this country cannot yet be conducted on so large a scale as to be most economical and productive, by reason of the branch of business not having been established over thirty or forty years, and having been broken down three or four times during that period by hostile legislation, and carried on the rest of the time with fear and trembling, excited by the bad faith, and the vacillating policy of the government. ILet it be hindered by any cause whatever from expanding to such dimensions as to be the most advantageously conducted. In either of the two cases just supposed, the four establishments will infallibly run down the one. I hesitate to suppose that you will ask why, for the reasons I think will be instantly apparent to a person at all conversant with trade, or the doctrine of chances, or contests and competition of any sort. But I wish to guard myself against taking for granted what you will not concede, even supposing you to be of the straitest sect of free trade.

In the first ease, then, the four foreign establishments have not only our own market, but also their own home market, and that of all the world besides, to operate in. Each of those divers markets will be fluctuating, sometimes brisk, at others dull, and where either is dull, the current of their products will be turned towards the others, and by these compensations, their market, as a whole, will be more steady and uniform than if it were confined to any one country, however large. As the one establishment is limited to the market of this country, in 75

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PROPOSITION XIX. which the other four are also, as our case supposes, competitors with it, the shock of any stagnation and revulsion here, will fall upon its whole business, whereas the same cause will reach but a third or fifth or tenth part of the business of the four competitors. A single deep wound may prove mortal, while the party might survive the same degree of violence expended in superficial ones. Or take .an illustration in numbers. Let the four establishments have our own, and four other markets. Let the depressions and revulsions come round once in five years, as they usually, in fact, do, very nearly. Let the loss, for there always is one during the collapse, be ten per cent. per annum, on the capital employed, as would most likely be the case, if it ‘were five on the proceeds of the sales, which may be taken to be, annually, double the amount of capital permanently -employed. The depression usually continues from one to three years. The four establishments will find relief in the activity of their four other markets, to compensate for the depression in any one, so that the drawback is thus distributed much more equally and constantly, approximating to four or six per cent. every year on their whole business, which is wholly or partly made up by their profits, meantime, in other markets. They, of course, at the same time, leave an immense load in our market for our one establishment to stat, ger under, in addition to its own constantly accumulating weight-accumulating, because it struggles on as long as possible, to avoid the sacrifice of stopping. But the loss of ten per cent. a year for two or three years, much aggravated probably by depreciated credit, scarcity of funds to be lent, and the exorbitant current rate of interest, may very likely sink the owner of the one establishment; or if he, by and by, begins to rise, by the returning buoyancy of the market, the foreign competitor being only a few days’ dis 76

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PROPOSITION XIX. tance across the Atlantic, spies the first sign of his recovery, and directly throws.upon him an additional weight, before he is fairly afloat. So he may not recover himself, and while he is undergoing the process of strangulation, his freetrade benefactor rejoices exceedingly at the low price of goods sold to the consumer from the wreck; and triumphantly produces this result as a glorious illustration of the benefits of foreign competition; taking care not to glance at the permanently high price at which the same articles must be subsequently paid for. If you are not very young, you will recognize this to be literal history, from your own observation, if not experience; and if you have not lived long enough to witness or feel the experiment, you cannot but perceive that, from the nature of things, it must be so. The case put, is where each competitor can and will in any case, in the long ran, left merely to his own domestic competition, supply to you the same article at the same price, the difference being, that one is in a position to suffer less and endure longer, in the periodical visitations of commercial distress. The one competitor needs some help over these depressions; that is, such an adjustment of the commercial regulations, as shall give him some advantage, or rather alleviate the disadvantage he is under at such periods. The case supposed, as you have already perceived, is an illustration of the position of this country in respect to European manufactures, and maritime trade, more particularly those of Great Britain. In some branches, involving mostly fabrics of wood, leather, and cotton, including also some in which iron is the predominant material, business is conducted among us upon a scale large enough to give all the advantage possible to be derived from mere magnitude, and extended to a sufficient variety of foreign markets, to afford it all the relief and power of resistance and endur 7* 77

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PROPOSITION XIX. ance, derivable from that source. But this does not hold of other very important products, and the advantage still enjoyed by the foreign rival in the greater comparative magnitude of his business, and extent and number of the markets supplied by him, varies widely in different articles, ranging from one to five, or ten per cent. on the amount of sales, according to the state of each particular species of production. The advantage to the foreign producer, from these causes, we will estimate on the average at two per cent. on the proceeds. The cost of materials is a great matter in a competition to undersell the products.

All materials produced in the United States, as far as their money price is influenced by the rate of wages, are at a higher money cost and price, than in any European country.* The enhancement of cost and money price, is partly countervailed by lower rents, and by territorial advantages for some products, and partly by more direct and effective modes of production, and greater despatch. But these counterpoises do not extend to all articles ordinarily used as materials. The main exceptions are the two tremendous ones of wool and iron. In wool our producers have advanced most rapidly upon their foreign competitors, and the rather, because rent goes very largely, and labor but inconsiderably, into the production. The main obstacle is deficiency of skill. It is one of our greatest products, and would have been much greater, if a more skilful and effective legislation could have been brought to bear upon it, and the fabrics made of it, considered in connection * Mr. Mill somewhere says, in reference to the comparative value of money in two countries, as affecting the question of free trade, that it is immaterial, and that oftwo countries, the one in which the money price of labor and other things is higher by fifty per cent., is under no disadvantage in a freetrade competition with the other, in the markets of both. This assumption will appear to be wholly erroneous, under divers heads. 78

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PROPOSITION XIX. with each other. There have, however, been great intrinsic difficulties in this legislation, at first quite disheartening, but now in a considerable degree surmounted. The production of iron involves much chemical science, and nice intricate art, in which our producers cannot directly come up with their established foreign competitors, who are themselves constantly advancing. The certain unfailing supply of this material from reliable sources within our own control during war as well as peace, is as vitally essential to the arts, as like sources of supply of food and clothing are to the existence of the artists. Witness the scenes of misery and starvation in Ireland, and then gravely extol the saving of a cent in the pound or yard in the money prices, instead of adopting a course of policy for opening all possible additional employment to all useful laborers, whereby they may earn food for themselves and families, instead of starving in idleness amid low money prices, while the food, which they are deprived of the means of earning, is exported in great masses to foreign countries, to pay for low-priced manufactures, which they can never buy. In regard to the production of the main articles of food, there is no danger of any exterior interference with our domestic industry for some centuries at least. But in regard to its distribution to the whole population through the medium of a universal industry, free trade has a direct tendency, and, if in full operation, would have a rapid effect, to reduce us to the present state of Great Britain as well as Ireland. The high orthodox in the freetrade faith, teach, as they are bound to do, that the country has no more reason for encouraging the domestic production of iron and wool, than that of oranges and pine-apples. This is the usual comparison, from the time of Adam Smith downward. But those who have not penetrated so deep into the meta 79

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PROPOSITION XIX. physics of free trade, pass over iron and wool, and some other like indispensable articles, for the production of which our country and people are specially adapted, and thus implicitly admit that it is not desirable to depend upon a permanent supply of them from abroad. This is to be sure, in effect, to utterly repudiate the whole freetrade system, and shows the predominance of plain good sense over metaphysics in their minds. We will suppose, then, the maintenance of these productions will continue to be the policy of the country. The tariff of 1846, apparently for the mere purpose of discouraging our own industry, imposes duties on some raw materials used in our arts and manufactures, but it can hardly be supposed that so absurd a policy as this will long prevail. Assuming then that the price of some raw materials, as iron and wool, and others standing on a similar footing, will be enhanced in the United States for a longer or shorter period-of some of them, perhaps permanently-by a duty on the importations, we have another disadvantage under which the American producer is put, who uses those materials in his branch of business, in his competition with the foreign producer. In some branches of business, this disadvantage under which the law itself justifiably, and, in a manner necessarily, puts the American producer, amounts to a large per cent., say five or six, on the proceeds of his sales. In other branches it is trifling. Let the general estimate of it be two per cent. The above examination will, I hope, clearly expose to the mind of every person, the superlative absurdity of the Proerustes system of a uniform rate of duty on every kind of imported article. And it may, perhaps, suggest a doubt of the expediency or decorum of again taking counsel of the agents and partners of foreign producers, in determining on our commercial regulations. so

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PROPOSITION XIX. It is obvious that the disadvantage under which the American producer labors in competition with the foreign competitor, varies under each of the above heads, not only in respect to the several articles of commerce, being great in one, and trifling in another, as already remarked, but also in the same article, at successive periods, in the different stages of our progress in producing it. Thus, in some species of cotton goods, in some kinds of edge tools, in hats of different kinds, in divers musical instruments, and various other things, in producing which the foreigner formerly had an advantage by his better skill, machinery and processes, amounting to twenty or thirty per cent., he has now nothing to boast of in these particulars. Therefore an estimate of his relative advantage in one does not apply to another, and one that is true this year, may cease to be so next. You will be struck with one circumstance in going over the preceding analysis, which is, that of all these advantages possessed by the foreign competitor, but two are likely to be permanent, namely, the lower rates of wages and interest. The freetrade policy would have the direct and necessary effect to bring down our rate of wages. Under our step to free trade by the tariff of 1846, if so singular a thing as its continuance shall take place, multitudes of unemployed personrls, more and more than at present, every year increasing, will be traversing the country in search of work; and consequently the rate of wages will be reduced lower and lower, until we arrive at the European level. This might give some unwelcome help to manufacturers; but loss of skill and capital in the downward progress would, at the same time, be against theln. The other advantages of the European competitor, will still hold good, not excepting the rate of interest, which will still be high with us, as it always is in a stagnant behind-hand community, no less than in a very rapidly growing one, though from a different cause. 81

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PROPOSITION XIX. According to the above estimates, the average advantage of a European competitor is thirty-one per cent., without taking into the account any of the partially countervailing set-offs; that is, it varies on different articles from a very slight per centage, if anything, up to fifty or sixty per cent. on his sales. If you should consider this to be discouraging odds, you have only to go back thirty years, and you will find it to have then been much greater. Besides, we shall plainly see under other heads, that all discouragement and danger of sacrifice vanish, even supposing the odds not so much diminished already, as above estimated. But at present we will keep in view our proposed subject, namely, the probability, or rather possibility, of the useful arts springing up spontaneously. You have above presented to you the particulars in which an advantage may lie on the side of the competitor in a foreign country, where the arts are more advanced, and laborers are, by the low rate of wages, reduced to the very poorest food, clothing, and shelter, by which the strength necessary to support labor, can be maintained. You will at once see, that not one of those particulars can be struck out. You will also see that each one of them bears very hard against the introduction of most of the arts, into a country still in an earlier stage of civilization, in so much that, where a rude agriculture, and the rude improvements auxiliary to it, and to the furnishing of only coarse food, and clothing, and comfortless abodes, are all that the people can show, to distinguish them from savages, they may be kept in an everlasting semi-civilization, by the too facile introduction of the products of the perfected arts of wealthy, highly cultivated, industrious, alien neighbors. A people so circumstanced can only produce for themselves articles, for the production of which they have trans 82

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PROPOSITION XIX. cndent territorial advantages, or the transportation of which is in a high ratio to their value. In short, they will remain everlastingly in the condition of a colony. This will be palpably evident, if you go over the particulars just enumerated, in which it may appear, that the more advanced community has the advantage. You may, perhaps, add others that I have overlooked. Test the truth of my position for yourself.

You have two communities in commercial juxtaposition and competition; the United States, where wages and interest are high, and the productive arts, though rapidly progressing, yet less advanced in many branches, and many species of products turned out in comparatively small quantity, on one side; and Great Britain, France, Germany, and the Netherlands, in contrast and competition. Take the common price current, and estimate for yourself how the advantage lies, and what it amounts to. Make this estimate with all your prejudices in favor of American capability and resources, if you please, and you will, in spite of yourself, come out with the result, that free trade, if that theory, instead of being repudiated, in the first Congress, as it was, by the men who achieved our political independence, and made us a nation compacted together by a government, had been adopted and adhered to, we should now, instead of being the United States we are, have remained much the same as before 1776, except those disrupted political bonds; in short, substantially such as the other British-American colonies are at this day, or rather in a worse condition, that is, such as those colonies will now soon become, when the competition let loose upon them in the British markets, by the act of parliament of 1849, shall expel them thence, and at the same time, the growth of the arts among themselves, continue to be choked by the free influx of the products of the industry of the dominant country. 83

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PROPOSITION XIX. The practical adoption of the dogmas, or rather dogma, of free trade, in this country, now, and abrogation, in a great degree, of the existing legislation that is actually protective of industry, would reduce the country to a condition incomparably worse than if we had from the beginning remained rude and torpid in arts and industry, since a sluggish, subordinate, colonial existence may be passed, free of pain, and even with a dull satisfaction, whereas intense suffering would be incident to the retrogradation and decay, necessarily consequent to the chivalrous experiment recommended to us by the disinterested merchants and manufacturers of Great Britain, analogous to the pangs of the premature dissolution of a person in vigorous life.* Such is the result to which you must inevitably come, however reluctant you may be, upon testing, in the particulars named, the advantage of European labor and art over our own, in supplying our market with a very large proportion of the products of mechanical and chemical skill and science. The single capacity of the foreign competitor to hold out longest in an unchecked competition in underselling at a loss, is of itself alone, sufficient, supposing all other things equal, to enable him, if he is so disposed, as he undoubtedly is, to drive the American producer out of the American market. For you will, let you be ever so far gone in freetrade reveries, admit that if either competitor has, in the aggregate, any permanent advantage, he will, most assuredly, discomfit the other. And you cannot so far impose upon yourself as to go through the comparison above made, with all the deductions and counterpoises that you * By the adoption of the freetrade theory, I mean, of course, the professed neglect and leaving alone of industry in legislation and public policy, such as is inculcated by that theory, which, as I have said in a previous article, would in fact be to adopt a legislation and policy positively hostile to it. To let alone industry is impracticable, but to suppress and extinguish it, in affecting to let it alone, is quite practicable. 84

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PROPOSITION XIX. can possibly conjure up, so as not to come out with the resuit that the advantages in the contest are at present on the side of the foreign producer, in equal competition to supply our market with all articles the production of which is materially facilitated by more advanced arts, larger establishments, and larger markets, and lower rate of wages, where these advantages are not counterpoised by the expense of transportation. “That is the very reason,” you say, why we should depend on the foreign supply.” This -is flying off upon a collateral issue, a subterfuge that often serves in caucus and on the stump, and even in deliberate assemblies. Though I have grazed upon that question in the present article, it is more specifically treated in divers of the others, both preceding and following, where reasons are given for protection, notwithstanding the present, or, in many and very heavy branches of production, the permanent, money price, especially in time of peace, should be thereby enhanced. At present our sole subject is the spontaneous springing up of the arts.* * By the arts I mean all the useful arts, however conducted. The products of the mechanic, with other useful arts, are denominated manufactures, though I have not so often used that term, as I might, for two reasons. In the first place, the systems of protection alad free trade affect all the arts, as already suggested under a previous head; the fine arts and ornamental arts, and also the sciences, flourish and decline with the mechanic and other useful arts, being all linked together and mutually auxiliary to each other; and the high or low, present or future, money price, though of vital import in making exchanges in competition with foreigners in foreign markets or our own, is to be viewed in a very different light, in respect to exchanges between our own citizens, who being all put upon the same footing by the law, are upon a perfect equality in settling the terms of their exchanges. As among themselves, whether their land, materials, or labor, and the products of all three, are reckoned in a high or low money price, is perfectly immaterial, excepting that the high prices require the use of higher numbers, and a greater amount of currency of some kind, in buying and selling. Thegreat questions of economical science, therefore, with us in the United States, though they involve a consideration of the money price of the same articles at home as compared with 8 85

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PROPOSITION XIX. In respect to a large body of the arts that belong to an advanced civilization, then, whether to be carried on to the greatest advantage in private dwellings by individuals employed separately, or by great multitudes in company in large factories, you find on examination that, though this country is physically and in the character of its people, as well adapted to them as any other, yet some other, owing to some temporary circumstance, or the depression of its laborers, may, for the time, or, say if you please, for an indefinite time, have a material advantage; and if so, can drive us from our own as well as the foreign market, if it is left free to it so to do, and our producers left free so to suffer. For, in such case, free trade is nothing less than the privilege to a foreign industry to prevail against ours, and crush it. I think it may be made to appear very plainly, that no that abroad, involve also other considerations infinitely more important than the greater or less cost of that small proportion of our whole consumption with which we can possibly be supplied from abroad, not exceeding one tenth under any, even the most dependent, subservient relation we can assume towards other countries. If I speak of the arts, the reader is less likely to lose sight of those other great considerations, connected with our whole social and political wellbeing. Again, ill the second place, the term manufactures, though it properly comprehends all the mechanic and useful arts, is so frequently used in popular discourse and publications, in reference to those conducted on a great scale in factories, that to many persons the term has no other import. Some one or more species of manufacture for which a country has a special adaptation, as of silk in China, iron in Sweden, springing from the fossils or peculiar soil or climate of the territory, and in the nature of spontaneous products, may be carried to some moderate degree of improvement, independently of the state of the sciences and useful arts generally in the country. If it be said that such arts will spring up spontaneously in any country, just as the art of curing the hides and meat of the buffalo has sprung -up among the Indians of the western prairies, and that of curing fish among the Simoides, it may be readily conceded. When persons speak of “manufactures encouraging themselves,” with reference to the growth of the country and the development of its resources, and of the genius and capabilities of the people, we presume them to have reference to such arts and sciences as belong to a people in an advanced state of civilization. 86

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PROPOSITION XX. country, not possessing a predominant military and naval power, can, without the most imminent jeopardy to its national safety, civilization, and economical wellbeing, expose its industry and arts to such an encounter: at least you will easily satisfy yourself that this country cannot. You will find yourself compelled to the conclusion that, to take that course, would annihilate a vast proportion of our national industry, sufficient to cripple and stunt the whole. I say that you cannot have gone through the examination, and tested the effects in the manner above proposed, upon any principles or modes of estimate that you can honestly adopt, without coming out with the conclusion that free trade would be a sovereign prescription to make us a dwarfed nation. I conclude, then, that manufactures will not “encourage themselves as soon as the country is adapted to them,” and that they must be encouraged by this country and every other that chooses to have them. XX. Low price, whether in money or barter, is not the sole criterion of the best economical policy-Free trade assumes that it is. You never knew a man to prosper, who occupied himself wholly in making great bargains. The propagators of free trade assume that the mighty interests of national industry, arts, defence and prosperity, are to be wielded upon the sole principle of making cheap purchases abroad at the time being. This is the transient narrow basis of their structure; and they deceptively allege for the doctrine, the authority of individuals in managing their private affairs.

A cultivator fells a forest andcl grubs up a swamp, and clears his field of boulders, though it may require the crops of some years to reimburse his expenditures. If the father S7

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PROPOSITION XX. of a family can, by a present outlay for tools and materials, and for the acquirement of some skill, enable his children to make articles for domestic use, at times when they would otherwise be idle, he does so, though the articles would thus cost twice their market value, reckoning their time at the current rate of wages, if such wages could be had. A huckster, whose sole business is making profit by the purchase and sale of articles on a small scale, occupies himself solely with the net present profit-and-loss result, in his cash account. But the husbandman, the projector of distant voyages, or of a system of business involving outlays and the combined prosecution of divers arts to produce future results, and also the legislator, whose acts are the causes of resulting causes and effects in an indefinite series hereafter, cannot test their work by the footing of the to-day’s profit and loss, reckoned in cash. The two periods of intense distress since we became a nation, were after the peace, 1783 to 1789 -and after the last war, 1817 to 1824; and at each of those periods foreign goods were at very low prices in our market: a sufficient proof that the national wellbeing is not exclusively governed by the prices of imports; and that some other circumstances are to be taken into consideration in accounting, for the hapimess land misery of mankind. 88

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PROPOSITION XXI. XXI. The comparative price at which citizens exchange the products of their labor and capital with each other, is the important consideration-As long as the ratio of the price of one thing to that of another is the same, it is immaterial, as between themselves, whether that rate is high or low-Free trade teaches that the low money price of articles consumed in the country, whether the same be produced at home or abroad, is the sole consid eration to be kept in view. Free trade triumphs greatly in beating down mechanics; as if to get articles made by them cheap, were a great national blessing. Thus, a writer in a recent Edinburgh Review* makes much gratulation that the reduction of the British tariff of duties on gloves and linen, had reduced the price at home, and augmented the exportation. Now, if the reduction had any influence whatever upon the price, (which it probably had not,) it must have been by reducing the pay of the already miserable makers in London, and in the north of Ireland. Thus the writer, in effect, felicitates his school and the British empire, on the enhancement of the misery of the miserable.

Free trade had, as he imagined, given that fortunate people gloves at a penny or two cheaper, and put Irish damasks on the tables of the ”’ Czar of Russia,” and the kings of “Denmark,” “Saxony,” and “Sweden,” the “ex-king of France,” and even “Queen Victoria.” This is the sort of glory, real or imaginary, on which free trade plumes itself. As to the foreign triumph, contemplated by the writer from his high position of low money price, it is not proposed to consider that here, where we are looking exclusively For July, 1849, pp. 146-150. 8’ 89

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PROPOSITION XXI. at the domestic achievement so extolled in the review.

Let it be granted then. Double and treble it, and still let it be granted.

Admit that some of the British people wear kid gloves, or whatever other kind occasions the writer’s ecstacy, at five per cent., or ten per cent.

less cost, by reason of the reduction of duty in 1842. So much is wrung from the poor workmen. There is nothing peculiar in the glove business.

This writer mentions nothing. A like achievement in hosiery or any other article, is to be no less desired. Go then to the hosiers, hatters, tailors, shoemakers, housewrights, cultivators, and all other artisans, until you have visited the whole circle of useful domestic industry with your beneficent process, and brought down the products of each ten per cent. What have you accomplished? And for whom? So far as the persons are concerned, who are employed in carrying on production, either as principals or agents, and operatives, which in the United States comprehends nearly all the community, the effect is merely that less nominal capital, that is in money, by ten per cent., is requisite to carry on the same business of all kinds; and in exchanging the products of their own labor mutually among themselves, which comprehends some nine tenths of all the exchanges they make. The two parties to each exchange, reckon the price of the same articles exchanged between them at nine dollars, instead of reckoning it at ten, as before the reduction. Persons whose property consists of public stocks, bank stocks, or the balance of debts due to them, are benefited, if they have held it in those forms from the time when the reduction began; which would, however, not be one case in a hundred. The result then is, that in respect to the great mass of our exchanges, including labor among them-for that is bought 90

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PROPOSITION XXII. and sold, as well as its products, and quite as extensively, and the price of labor influences that of products, and the, price of products influences that of labor -the result I say is, that the amazing improvement so rapturously hailed by the professors of low money price, when finally consummated by the depreciation of all the vendible articles of all the workers and vendors, comes to nothing more than reckoning the value of two things exchanged for each other, or in other words, the article sold and that bought as its proceeds, at nine dollars instead of ten. XXII. We ought not to depend upon any foreign country for such ordinary necessaries of life as the country is well adapted to produce, at least until we have a naval power able to command the ocean -Free trade pro poses to render us immediately and permanently so dependent. Formerly we had an immense household manufacture of wool and flax, both before and long since the revolution. Every house in the country was furnished with a great spinning-wheel for wool, a small one for flax, with wool-cards, a hetchel, warping-bars, and a loom. Some of this antique machinery may be still found in the interior. I made a discovery of some of it near the White Hills, in New Hampshire, as late as 1848. Adam Smith, in his inquiry into the nature and causes of the wealth of nations, lays down a proposition that has been round and round the freetrade circle now for these eighty years, the import of which is, that if a woman’s wages were a quarter of a dollar a day, and with that sum she could buy as much woolen cloth as would cost her the labor of a day and a half, including the cost of the material, 91

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PROPOSITION XXII.. that can be produced or manufactured abroad and imported, at a lower money price than it would come to if produced or made at home. Yet the same persons who make such assumption, do not deny that there are thousands and millions out of employment, many of them starving with hunger and cold, in different countries, who would gladly labor if they could find others to employ them, or means to employ themselves.

There may be such perishing multitudes in a country that at the same time exports provisions, as in Ireland, so that the fact of a sufficient domestic production of an article of necessity, does not secure a population from starvation for want of its distribution. This must depend upon there being such an internal industrial organization as may, through the medium of full employment at adequate wages, distribute the requisite portion of the annual products to the different members of the community.

It appears under other heads-, that free, trade, as a general system, has no tendency whatever to multiply and diffse domestic industry, and that protection and encouragement, when extended with any, even moderate discretion, not merely has such a tendency, but is obviously and infallibly effectual for such purpose, in any country not ‘become overcharged with population surpassing all internal room and means of occupation; that is, it has such effect in a country in which any old species of industry can be extended, or any new one introduced. At present we exclude that inquiry, and look merely to the fact of the national supply of articles of necessity by domestic production, or by importation from abroad. The question is merely this. Is a population, among the great ‘branches of whose industry is the domestic production of the common and necessary articles of food, and clothing, Eand fuel, and ordinary conveniences of living, as liable, all 93

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PROPOSITION XXII. that can be produced or manufactured abroad and imported, at a lower money price than it would come to if produced or made at home. Yet the same persons who make such assumption, do not deny that there are thousands and millions out of employment, many of them starving with hunger and cold, in difrent countries, who would gladly labor if they could find others to employ them, or means to employ themselves. There may be such perishing multitudes in a country that at the same time exports provisions, as in Ireland, so that the fact of a sufficient domestic production of an article of necessity, does not secure a population from starvation for want of its distribution. This must depend upon there being such an internal industrial organization as may, through the medium of full employment at adequate wages, distribute the requisite portion of the annual products to the different members of the community. It appears under other heads, that free trade, as a general system,.h-as no tendency whatever to multiply and diffse domestic industry, and that protection an&
encouragement, when extended with any, even moderate discretion, not merely has such a tendenecy, but is obviously and infallibly effectual for such purpose, in any country not ‘become overcharged with population surpassing all internal room and means of occupation; that is, it has such effect in a country in which any old species of industry can be extended, or any new one introduced. At present we exclude that inquiry, and look merely to the fact of the national supply of articles of necessity by domestic production, or by importation from abroad. The question is merely this. Is a population, among the great branches of whose industry is the domestic production of the common and necessary articles of food, and clothing, Ad fuel, and ordinary conveniences of living, as liable, all 93,

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PROPOSITION XXII. other things being equal, to be reduced to distress and starvation, as one habitually and permanently depending upon the industry of the other hemisphere for such supplies? This is a grave question for a legislator, or speculative thinker, or philanthropist, or patriot; and one to which but one answer can possibly be given by any person, of what ever economical creed. If only one answer can be made, is there any doubt of the importance of the inquiry? Will any person say it is a trivial criterion of the comparative character of two systems of policy, whether one or the other has the greater tendency to starvation or other physical distress? Where a nation, like the Romans in their glory, predominates far and near by sea and land, and holds absolute control of access to all markets for exchanges, and all sources for supplies, in all climates; and can, at all times, throw the products of its own industry, whatever they may be, into every market, and derive all kinds of products from everywhere, it has some apology for indifference whether ordinary articles of necessity must come from within its own limits or from another continent. But only one nation can enjoy such pre-eminence at once, and it is not often that any one has it. Distant communications, and resources, implicated with alien and antagonistic interests and influences, are subject to disturbances and vicissitudes, from which it is desirable to secure the ordinary supplies requisite to the subsistence and comfort of the masses of the population, as far as they can be so secured without very great sacrifices. So far as this country is concerned, they can be secured without the slightest sacrifice, as is fully shown under other heads. We are here upon the proposition, that, if such security could be had only at great cost, it would be worth it, for 94

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PROPOSITION XXII. one of the leading benefits of government is the steady preservation of the physical wellbeing, of its subjects. To pretend to define all its functions for this purpose under the dogma, laissez-nous faire, is mockery; and to identify the supreme social good, with the mere present low money price, is charletanism. Enlargement of occupation at fair wages, and the certain command of supplies essential to physical comfort and national defence, are objects worthy of some consideration to legislators, and of some thought on the part of those contemplative persons who take upon themselves to teach mankind how to improve their condition. And ever since the days of 2Esop’s lark and her young, it has been as true in respect to a nation as an individual, that one who depends on himself, is not so liable to be disappointed, as one that depends upon others.* Any man who should question the truth, or grave importance of this proposition, would be wondered at; and, therefore, the freetrade economist usually dodges it; he cannot recognize it without negativing his whole creed-t * The freetrade partisans very often admit the great importance of the domestic supply of things materially necessary. Thus Mr.

Edmund Burke, whom I understand to endorse Mr. Walker’s freetrade paper, says, in his report as commissioner of patents for 1848, p. 147, speaking of rotting hemp, “It would be a good appropriation were the navy department to have a course of experiments tried by Mr. Fleischman for this purpose. If it succeeds, it will doubtless relieve the country from the necessity of importing hemp from Russia.” t In the practical application of the proposition above stated in the text, inquiry arises as to the specific articles of necessity and ordinary use, such as iron, wool, and many fabrics of which each constitutes a large part, which it is essential to the wellbeing of this country to produce from our own resources; and which specific article first, and which next, and how many, and what ones in concurrence. These details are not within my plan, through the principles and criteria on which the discrimination is to be made, will be found touched upon under various heads. 95

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PROPOSITION XXIII. XXIII. Home competition compels producers to as intense competition and as low profts, as foreign - Protection not monopoly-Not true, as insisted by free trade, that foreiyn competition is necessary to put home production at the lowest practicable rate. Everybody knows that the people of this country are vigilant to push into every branch of business that promises extraordinary profits, and not slack to follow one that affords only the ordinary rate. Everybody also knows that this produces a sufficiently brisk competition to reduce every species of production and trade to the average rate of profit, and stimulates each one in each branch, to resort to every improved process, and to practise the strictest economy, in order to save or enhance his profit. And yet free trade is always implying, and very often saying, that foreign competition is essentially necessary to regulate profits, skill, improvements, and economy, in home production, to the desirable point.*

Though each one of ten or twenty thousand domestic producers is putting forth his utmost energies to be able to undersell the others, and get the supply of the market, still the freetrade professor laments the sluggishness of these producers, unless they are stimulated by foreign competition, for applying which he complacently explains to them their obligations to him. This is going beyond the doctrine, that the subject to be operated on can secure happiness only by willingness to be miserable, for it congratulates him on the fact of his actually being miserable.t *

Edinburgh Review, July, 1849., p. 149. t Edinburgh Review, July, 1849, p.

149, where the writer, speaking of the reduction of duty on silks, says that bringing that branch of industry into competition with French industry, called the English “skill into more active opera 96

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PROPOSITION XXIV. XXIV. Protection promotes commerce -Old pretence of free trade that it would destroy commerce. One of the early great objections to the protection of domestic arts, was, its supposed tendency to ruin commerce. Experience has confuted the objection, and the wonder now is that it could ever have been made; for if it be supposed that it would entirely extinguish the foreign commerce of the country, which is an idle dream, still it would evidently increase domestic trade to a greater amount; and it is indifferent to the trader himself, so far as his own profit is concerned, whether the two parties who exchange the products of their labor, be an American and foreigner, or both Americans. Protection increases labor and its products, and as every producer, either in cultivation or the mechanic or any other arts, exchanges, half, three quarters, or the whole, of the products of his labor, with some other producers, either domestic or foreign, the increase of industry and its products, of consequence, augments commerce. “But does it increase labor and its products?” you ask. This inquiry is answered under other heads.

XXV. Protection of our own industry will not bring the necessity of resorting to land-tax and excise-free trade pretends that it will.

Another fanciful objection to protection, is, that it will dry up our present great source of revenue from import duties.* This dreaded consequence will probably happen tion, by which the manufacture cannot fail to benefit.” The only effect, if any, in this respect, as in linens and gloves, must have been to pinch the workmen. * Secretary Walker’s Report, 1848. Examination of Baldwin’s proposed tariff. Printed in New York, 1821, p. 128. 9 97

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PROPOSITION XXVI. about the time when the sky falls. Chimerical notions like this are less surprising when insisted upon, on the circuit, to a petit jury of twelve, than when put forth in a grave official document addressed to a tribunal of twenty millions. But the thorough-going transcendentalists in free trade, instead of lamenting the loss of this source of revenue, propose voluntarily to abandon it at once, for land-taxes, excise, and poll-tax. XXVI. Balance of trade-There is such a thing- -A country may buy of another more than it pays for, or can pay for at the time; it can be constantly in ar rears-Free trade assumes the contrary. “The balance of trade is a vision.”* So says free trade. If it be a phantasm, it is a very mischievous one, for, as Adam Smith says,t “A nation may import to a greater value than it exports, for half a century, and the gold and silver that comes into it, all this time, may be all immediately sent out of it” by this phantom, and “the debts which it contracts in the nations with which it deals, may be gradually increasing.” The consequent evils are scarcity of money, paper-money, long credit, commercial embarrassment, bankruptcies, annihilation of the value of many species of property, suspension of industry, loss of employment to laborers, distress to the poor, and railings and recriminations by different classes against each other, as being the authors of the distress. In the meantime, unprincipled demagogues exasperate these mutual animosities with malignant glee. * Examination of Baldwin’s proposed tariff. New York, 1821, p. 125. And see the freetrade writers, passim. t As quoted by Mr. Colton, Public Economy. New York, 1848, p. 328. 9s

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PROPOSITION XXVII. All this is familiar to every person conversant with the history of this country, while it was a colony politically, and, since 17]‘6, at those periods when it has been no less a colony industrially, by reason of its foreign commercial relations. But the philosopher of free trade contemplates this disturbance of the industrial elements, with serene tranquility; being profoundly certain of the restorative operation of his universal remedy, viz., the very evil which, he gravely assures you, “will cure itself;” and this he seems to think just about as satisfactory as if it could prevent itself. XXVII. It is not for us to take care that other countries shall have means to pay us for our exports - Free Trade says it is. We are reminded by free trade, that “The result of protection must be the annihilation of the foreign-import trade of the country, so far as regards the articles protected; with the exclusion or diminution of imports, the exports must cease or be reduced, for foreign nations could not buy them.”* That is to say, we must take care lest, by producing for ourselves, all, or too many, of the articles for our own consumption, we shall thereby withhold from all, or some, foreign countries, the means of paying for those which we export to them. It not unfrequently happens, that individuals who are not very skilful or vigilant in their own concerns, have a great solicitude in looking out for these of other people. So the freetrader says, ” Let alone the industry of your own country, and take care of that of other countries.” lHe says we must first take an immensity of imports from the foreign * Rep. Sec.

Treas. 184. 99 :.e

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PROPOSITION XXVII. producer, and then he, honest and grateful man, will straightway take as much of ours. This is supposing him to make an overture analogous to that of a worthy knight of the time of Henry IV., “

He that will caper with me for a thousand marks, let him lend me the money, and have at him.” He is supposed to propose to us, to buy and pay for his goods, and get back the same amount in the price he will pay for ours, if we can. But perhaps he will out-caper us, and so keep the money himself, and let us go for another customer, where we can find him. Some of our “fraternal” foreign producers have done this for some years past, to the amount of some fifty to sixty millions at least of the precious metals and stocks, that we have remitted to them, to pay the balance that we have taken of them, over the amount which they have taken of us in return. Nations are in the practice of making commercial conventions, when each supposes it gets quid pro quo, and the recluse transcendental political economists who write textbooks for our colleges, have recommended by all means to have no thought for the quid; but I am not aware that any / statesman has ever before put forth such a notion, in practical affairs, or otherwise than as a decoy to foreign countries. This involves the question of balance of the direct trade between two countries, which may signify much, or little, as the case may be. It differs essentially from that between one nation and all others, such as the one against this country, the three past years. This “vision,” as it is styled, when sinister, is a significant diagnostic of a disordered industrial system.* Not necessarily so is the balance between two countries in respect to either of them, if each * The excessive drain of the precious metals is the only sure indication of the actual general balance. The returns of exports and imports to the Treasury department are a very fallacious index of it. 100 .;,, i.

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PROPOSITION XXVII., has a trade with various others. The trade of each with the other, will run into that of third parties. We send some millions’ worth of cotton to Great Britain every year. One third, or half of this, may go to supply the consumption of Great Britain and its dependencies; and the remaining half or two thirds go to third countries, and come back to us, in the shape of cotton fabrics: that is to say, it is in effect a transit trade between us and such third countries, as far as the material that goes to them is concerned. This part of the trade is vastly more important to Great Britain than to us, provided Great Britain has competitors in this trade to third countries, as she has in the French and ourselves. Great Britain can keep only as much of the supply of the third countries in her hands as she can furnish cheaper, or in some way more convenient and acceptable to them than her competitors. Her statesmen know this very well, and accordingly the duty on the import of cotton into that kingdom, has been taken off. No stipulation whatever is proposed for a preference to us in this trade. The cotton-growers say they do not need any such preference. True. But many champions who have challenged all the world have aforetime been beaten, and the same is possible hereafter. If, however, the preference should be needed, it will never be granted. We can send through Great Britain to other countries what it is for her advantage to take. So we in turn reship to other countries considerable quantities of our imports, either in the same form, or after manufacturing them. It is a combination of trade and industry which operates very beneficially upon any country. It is, then, as you see, a very complicated, puzzling computation, to settle how much the consumption of A.‘s products by B.

enables A. to buy those of B. According to the commercial returns, we export less than 9* 101

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PROPOSITION XXVIII. three quarters of one million to the British East Indies, and import thence two millions. Supposing these returns to present the true state of the case, it is not necessarily, in itself, a datum for any important inference as to the trade being advantageous or prejudicial to us. We might export much to any country and import nothing directly from it, and yet the trade be equally advantageous to both; for much of foreign trade goes through a circuit. A. buys of B., B. of C., C. of D., and D. of A. Each member of the alphabet is concerned in some hundred or thousand such circuits, the result in each of which, as far as he is concerned, may not be a fact of any important significance, though the balance of his cash account with the whole, at the end of the year, may affect very materially his industry and productive capacity, as I have stated more particularly under another head. There are, then, two good reasons why we should not vex ourselves to look out to furnish other countries with the means to pay for what they wish to buy of us; first, because we do not show any such superior sagacity in our own commercial arrangemnents abroad as to evince our eminent qualification for that function; and, second, because we have not the means to understand their case. XXVIII. Protection of our own domestic industry is in no degree hostile to other countries -Free trade pretends the contrary. We are told that free trade makes man the brother of man, and the citizens of one country brothers to those of another, and protective legislation is “the forbidden fruit whose taste 102

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PROPOSITION XXVIII. brought all our woe,” with loss of the industrial Eden of cheap products.* HIow does freetrade policy lead to peace? Did the desire of Great Britain to free trade in opium, lead to peace with the Chinese? Free trade proposes to bring about greater communication and exchanges, and complicity of interests, between nations. Does this necessarily bring peace? Before entering into this contract of community, it is better to look out to see which party is to act the lion in the division of advantages. The more complicated, and blended together, the interests of any two countries are, the greater the danger that one will become wholly dependent upon, and subservient to, the other. This is the reason why Great Britian just now preaches national communism, to some in the namby-pamby rhetoric of the freetrade school, to others in that of saltpetre. It is prudent in a nation, as well as an individual, to deliberate before entering into these fraternal intimacies with all comers. The fellowship may be the good-fellowship of equals, but it may be only the harmony and good mutual * ” The true industrial interests of nations are identical, and in exchanging with each other the products most cheaply produced by each, labor everywhere benefits labor, man his brother man, and nations each other, and their only antagonism is introduced by legislation.”’-Sec. Walker’s Rep. 1848. This very metrical sentence has other poetical merit besides its rhythm. 1st. It assumes that there is no such thing as international competition and antagonism in trade and industry between us and any other country, or between any two countries in the world. 2d. It assumes the money price at the time being, as the only criterion. 3d. It assumes that there is an unbounded foreign market, where every man in the United States, who works at high wages, can exchange his products for the cheap ones of low wages. 4th. It assumes that every man in the country has employment whereby to produce something to be exchanged. 5th. It assumes that the cheap foreign labor benefits our laborer who has high wages. 6th. It assumes the let-alone axiom. 7th. It assumes that the main dependence of this country is on its foreign commerce. We thus have more fictions than lines. And ifyou analyze any other piece of freetrade rhetoric, you will find it to be made up in the same way. 103

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PROPOSITION XXVIII. understanding that take place when one can say to the other, “Go, and he goeth.” Have we not at this minute questions about reciprocity? The British minister, in behalf of his government, puts in for a part of our coasting trade. He also begins to inform Congress what acts of theirs “will produce a disagreeable effect upon public opinion in England,” on a subject that concerns Russia and Sweden no less than Great Britain. This is the initiatory of our national fraternity with Great Britain on the freetrade platform. Whether it is original with the British minister, or with his government, or first hinted by some of our own freetrade compatriots, does not appear. The constitution requires the president to recommend measures to Congress, but it has no specific provision to the same effect in respect to the British government, or its representative. It seems to require a little brush every thirty or forty years, to awaken the consciousness in England, that we are not still part of ” Her Majesty’s provinces in North America.” Perhaps our minister in England will, in return, suggest to the Parliament what acts will have an agreeable or disagreeable effect on public opinion in the United States, as a test whether the new dawning commercial fraternity is perfectly reciprocal in its operation. No. The notion of community and unity of interests between nations, in this world, prior to the “Advent,” is as false and fanciful, as it is in respect to individuals, and there is no more probability or possibility of its being universally adopted and acted upon by the former than the latter. There are, in either case, both commercial and industrial unities and diversities, concurrences and competitions, coincidences and antagonisms; and when any one asserts the contrary, it only suggests the query, whether it indicates fantastical thinking or sinister purpose. 104

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PROPOSITION XXIX. The idea that the jumbling of all nations together in a higgledy-piggledy fraternity in matters of industry and commerce, and the opposite Japanese policy of national occlusion, are two extremes, each of which is to be shunned. In medio tutissimus ibis. XXIX. The country may be crippled by a foreign com merce that is pro,ftable to those directly concerned Free trade says what is profitable to them, is best for the whole country. What an importer of foreign goods finds to be for his own interest, is, says free trade, speaking through Adam Smith, for the interest of the country. It is for the interest of the importer to do a great and profitable business the present year, and his profit or loss this year has little or no connection with that of the next. Suppose all the importers to be, at present and in future, American citizens, residing permanently in the country, and not birds of passage, commorant here only in harvest time, and admit their interest now and hereafter, as a body, to be identical with that of the country; even in that case the importer of to-day has no motive for talking care of the interest of his successor twenty years hence. He is influenced wholly by motives of present gain or loss. His interest is not identical with that of the country. He is not, therefore, a proper representative of the interests of the country. If we could convoke a council of the importers of the present time, and that of twenty and that of fifty years hence, we might then have an approximation to a just representation of the interest of the country. The legislature is this council. The legislators, if they truly fulfil their functions, are the practical personations of the merchant, and tradesman, and other classes of the future, as well as the present. : -‘l.. i J ~ 105

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PROPOSITION XXX. If the present life were for two or three centuries, then Adam Smith’s proposition would be less fallacious; though still sufficiently so, for the result of a trader’s purchases and sales, whether abroad or at home, usually come about in a short period, whether he himself be long or short lived. He, therefore, looks to the immediate result; that is, if he be an importer, to the profit of the present importation. But if the consequence of his large business is the drain of specie from the country; high interest; an indebtedness abroad, accumulating and weighing heavier and heavier upon the country for half of a century, as Adam Smith says it may be; and a suspension of our own industry and stagnation of our arts, causing our civilization to be stationary or to retrogade; it signifies little to the public that the importer has himself made a profit. In fact, a nation as well as an individual may be ruined by doing a business that is profitable at the time. It is what very often happens. This is the abyss into which the freetrade advocates are endeavoring to precipitate the country. XXX. It is not true that capital remains entire, to be trans ferredfrom a bad business to some other - Free trade assumes that it remains, and can be withdrawn from an abandoned business to a better. The freetrade writer in a late Edinburgh Review already cited,* speaking of a kind of business abandoned as impracticable, says, “We may be certain that the capital, which will be withdrawn from it, will not be suffered to be idle, but that it will be turned to account in giving employment to industry in some new channel, much more to the welfare of the community.” * July, 1849, p. 146.

106 o.,,.., . I

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PROPOSITION XXX. This signal commonplace of free trade, is characterized no less by cool contumely to misfortune, than outrage to the common sense of mankind. You meet with it in all the freetrade essays, great and small, from Adam Smith downward. In the very article just quoted, the writer mentions the complaint of a leather manufacturer that the sudden reduction of the price of leather occasioned by the change of the British tariff, of which the writer was speaking, operated hard upon the six months’ stock which he was obliged to keep on hand in his business. Suppose the reduction to have been twenty per cent. and his stock is fifty thousand dollars, and his own floating capital, besides structures, fixtures, machines, apparatus, and tools, to be ten thousand dollars, and the amount of his debts five times that amount, a proportion by no means extraordinary. What part of his floating capital has he to withdraw and “turn to account in giving employment to industry in some new channel?”

Suppose his business to be broken up, the very case of which the writer is speaking, into what “new channel” will this same leather manufacturer turn his vats, his structures, fixtures, machines, apparatus and tools, all which are adapted to that branch of business, and no other? Into what other channel would the proprietors of sugar estates turn their capital invested in planting plantations of cane, and putting up buildings and apparatus for grinding canes and making sugar, if that business were broken up? Into what other channel shall the worker in iron, iron-making, or coalmining, turn his skill in that business, which is his capital, which he may have been years in acquiring, in case of such business being broken up? The same inquiry may be extended to every established branch of business, great and small, and receive the same answer. The other “channel” is perdition. 107

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PROPOSITION XXXI. You will say then, perhaps, in behalf of free trade, that I maintain that every species of industry has inalienable vested rights in the pursuit of its particular business, but I do not. My proposition is, that when a manufacturing, or any other business, requiring peculiar structures, fixtures, machinery, apparatus and tools, and skill, is broken up, but a part, at best, and frequently not any, of the capital invested in it, is left to be turned into any channel. Free trade is forever repeating the contrary. XXXI. The dogmatism of free trade in persisting in its assumptions. We have seen that the freetrade theory begins by taking for granted, at least, eleven palpably false propositions, every one of which is essential as a foundation of the system, without saying with your leave, or paying you the decent respect to give any facts or reasons. It was to be expected that thinkers, who set out with such premises, would attempt to patch up, and prop up, their conclusions with false pretences, fallacies, and sophisms, and wander off, perplexing themselves and their disciples with false issues, aside from, and immaterial to, the question; and raising a cloud by means of mystical jargon. I speak of the theory as being, at the outset, a dreamy hallucination, made up of fallacious, sophistical assumptions, the reproduction and reiteration of which, at this time of day, after so many unanswered and unanswerable expositions and experimental demonstrations of its utterly false and shammy character, call to mind the profound Mr.

Jenkinson’s learned discourse on Sanconiathon, Berosius and cosmogony, to which one might fairly give the reply of the Rev. Mr. Primrose, “I beg pardon, sir, for interrupting 108

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PROPOSITION XXXI. so much learning, but I think I have heard all this before;” and request the teacher of these mysteries of his “science,” to spare himself and us the repetition of those general, abstract, indefinite, mystical, transcendental theorems, and set about giving us some reason, practical or theoretical, for assenting to some one, at least, of those eleven fundamental propositions, to all of which he presumes our assent. Do you doubt whether I speak respectfully enough of those who have occupied the chair on this subject with such magisterial gravity? And pray, how much deference is to be challenged by a thinker, announcing himself to be one of the great lights of the world, who has been reminded now these many years, that there are, at least, eleven specific, essential conditions precedent to his imagined industrial and commercial millennium, all of which seem to be utterly wanting, and if either is so, his whole theory explodes; and yet he unheedingly goes on, monotonously chanting, as if by rote, these same groundless assumptions, not unlike a Moslem Mueddin, reciting in his pulpit chapters from the Koran. Does he, in fact, assume these propositions? That has been shown, and is notorious. Have they been denied? Again and again. Have they been distinctly pointed out to him? Often. Does he deny that he assumes them?

Not at all. Does he undertake to prove them? Never. Does he give any reason for them, or for any of them? None. Does he give any reason for not giving a reason? Never. Does he say anything about them? Not one word. On the contrary, whenever he spies one of these chasms of his “science”

ahead, he veers, and gives it a wide berth. If you remind him of -it, he plays deaf, and hurries off in a torrent of phraseology. Judge then, which party is the aggressor in point of conventional decorum; the one who gives and asks for a reason, 10 109

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PROPOSITION XXXI. or the one who arrogates to himself the privilege of dog matizing ad libitum. There are not wanting men of quite measurable knowI edge and intellect, and quite immeasurable self-conceit, who, after musing for a time upon national economics, do, in all honesty and simplicity, bona.fide, consider themselves to be duly commissioned as the true successors to the apostle of their “science,” and have such a comfortable assurance of the faith that is in them, that they fancy their mission to be merely to announce it, and dogmatically prescribe to men, all and singular, to become implicitly endowed therewith. It is to no purpose to reason with such. If one comes to a position through a maze he knows not how, he finds it very difficult to retrace his steps. Some persons persuade themselves that they have a pecuniary interest in maintaining what is called free trade. I am persuaded that, the more the subject is agitated, the more clearly they will see that the pecuniary interest of individuals, (I mean Americans, permanently stationed in the country,) is identified with that of the country. Those who practise politics for a living or through ambition, if their local, sectional prospects are on the side of the freetrade theory, will, of course, be very slow to be convinced of its sophistry until after their supporters are so until when, they cannot be regarded as hopeful cases. So the class of dreamy, transcendental abstractionists, devotees to a single idea, who have soared to some empyrean height, where they have lost sight of this world, or are so far from it that they cannot distinguish their own country from another, though they are honest, sincere, and commendably ardent, yet they are so pre-occupied and so far off, that I have no hope of gaining their attention. But I more especially and hopefully address these propo 110

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PROPOSITION XXXII. sitions, not only to those who have not examined the subject, but also to persons * who, having wandered into the mysticisms of free trade, in their incipient cogitations upon social phenomena and social destiny, have too easily acquiesced in the enormous sophisms and inconsistencies of Adam Smith and his echoes, and are free from pride of opinion, esprit du corps, or other bias, to hinder them from revising their opinions candidly. XXXII. Accumulation of capital necessary to prosperity, industry, and arts. There are not wanting in our community, or any other in the world, persons of untoward circumstances or untoward dispositions, who cherish a spite against those whom they deem to be more fortunate; and they have reason, in countries where the distinction is arbitrarily established by the laws of inheritance, or the terrific authority of superstition; or the no less mighty one of hereditary distinctions of castes and races. Neither our laws nor customs encourage such distinctions between free citizens, but, on the contrary, aim at a complete equality of rights. Some are not satisfied with this, but insist on a universal equality of condition. I mention this subject, (not for the purpose of contending with the malignant philanthropy of socialism, or the hypocritical appeal of demagogues to the bad passions,) but on the contrary, to say that I do not intend to propose anything here that is not just as applicable to a community where an idle knave shares the earnings of an honest, industrious member, as where the latter is entitled to his own earnings. The simple question is, whether the existence of wealth in the community, is desirable in general, the laws, civil rights, * Pars quorum fui. ill

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PROPOSITION XXXII. customs, and all other things, being the same. Is the condition of all descriptions of persons, including the destitute who depend on alms, as well as those who depend on themselves, on the whole, better in a community where there is an abundance of everything, or one in which there is a deficiency of everything? The distinction is precisely that ;between England and Ireland. A great mass of the population is without property in each. England is rich, and Ireland poor. In which of the two is their situation most desirable, or, if you please, least deplorable? There is no room for doubt. The affluence of a community, all things else being equal, is beneficial to all its members. But, in this country, this truth has ten-fold, indeed a Hundred-fold, more force, since the laws do not render the lands inalienable, nor make any distinctions of castes, or famiies, or classes, as to civil rights, or those of possessing, using, and transmitting property. The benefits of acquisition and possession, extend to very nearly all members of the community.

Instead of three out of four being destitute as in England, or nine in ten as in Ireland, with us not one in ten, probably not one in twenty, is so.

I think, then, I am safe in the position, that with us, accumulation of wealth in the country is advantageous to all. “Yes,” you say, perhaps, “provided it be not made by one, at the expense of another.” True, but that is not the present question. We shall come to it in course. One of the advantages incidental to the accumulation of wealth in a community, is obvious and universal, namely, the reduction of the rate of interest.

Anderson * cites Guicciardini, remarking upon the usual rate of interest of twelve per cent. per annum, at Antwerp, that “such a high interest *

Hist. of Corn., v. 2., p. 109, Anno 15803 Lond. Ed., 1789. 112

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PROPOSITION XXXTII. was a great grievance to the poor, as well as a great obstruction to commerce.” The Rump Parliament reduced the legal rate of interest to help English commerce in its competition with foreign.* If you double the wealth of a country, and at the same time reduce the rate of interest from twelve to six per cent., all those who need to hire money or get credit, (in other words, to avail themselves of the capital of others, that is to say, all the more active and less wealthy,) obtain double the quantity at the same annual expense. This is one among the very many advantages accruing incidentally to all members of a community from the accumulation of its general stock of wealth. XXXIII. Multiplicity of useful arts in high cultivation prerequisite to great national stock, to wit, capital; and great capacityfor production - Free trade proposes na tional poverty. It was a truly philosophical suggestion of MIr. Gallatin,t that the degree of civilization to which the American Indians attained, must have been essentially promoted by their possessing the article of Indian corn, that could be so easily, and so long preserved. The same remark is applicable to the dressed skins used by the aboriginal tribes.

These, with their weapons and pipes, constituted the main part of their capital, which I allude to for the purpose of illustrating more plainly what really constitutes capital; for the word is used by writers on economy, especially those of Adam Smith’s school, in a way to leave in the reader’s mind a vague notion of its meaning. It means valuable things possessed, * And., Hist. of Com., v. 2, p. 415, Anno. 1699. t Stated in Mr. Bradish’s Address to the New York Historical Association, 1849. 10o 113

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PROPOSITION XXXIII. and subject to transfer from owner to owner, exclusive of contracts and personal claims. You wonder why I should so formally state what is so plain. It is for the purpose of making my deduction plain. And I will proceed a step further by way of premises. Without going through the different classes of valuables, we will notice some few distinctions. Some are objects of taste, as pictures and statues; some of luxury, as plate, rich furniture, equipages, and jewelry, and architectural and personal ornaments. But the great body of the stock on hand, viz., the capital, of any community, in any degree advanced in civilization, consists of its instruments and apparatus for production.

The annual consumption of the people of the United States, at one dollar per week each, is one thousand and forty millions. The land, and all other vendible instruments and means of production used to supply this consumption, and at the same time add something to the permanent stock, must be some six or seven times that amount. I take it to be universally admitted by all persons, thinkers or not, to be desirable, all other things being equal, to live in a rich, rather than in a poor country.

There may be enough of misery in a wealthy country, as every one knows, but this is not owing to the abundance, but to an unfortunate social and industrial organization, and other causes; and even in such a case, the least fortunate will always feel the benefits of the general prosperity and advanement in arts. Not to dwell upon this point, if any one doubts the advantages of life to the poor as well as to the rich, in a country advanced in civilization, and abounding in arts and wealth, I refer him to Macaulay’s comparison of the present condition of the people in England, with that of the time of Charles II.* * See History of England, chap. 1.

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PROPOSITION XXXIII. Now, if you will sum up all the value of the land, materials, and stock on hand, and movable vendibles of every description belonging to an agricultural country, having only a few rude arts auxiliary and essential to a rude cultivation, you will find a small footing, compared to that of the inventory of the same country peopled with cultivators, mechanics, and artists of every description, with its agriculture and horticulture, as well as other arts in a high state of improvement, possessed of an immense apparatus of implements and machinery, and plentiful stocks for consumption, reproduction, and commerce. A town, like Bremen, or small territory like Venice, Florence, the Hanse Towns, etc., formerly, may be wealthy by its floating industry and foreign barter, making itself a great mart through which the exchange of products between foreigners is effected, but not so of a great country like the United States. If all the rude products of the whole territory could be exchanged abroad in the great purchases that free trade treats of in large discourse, it would only make a few wealthy marts at the points of exchange. The rest of the country would be so thinly peopled that a traveller would be troubled to find inhabitants of whom to inquire which of the bad roads led to his destination. A country cannot be well peopled without a well-provided population, nor wealthy without having domesticated within itself, the arts of production to which it is adapted, and keeping those arts in a continued progress and improvement. Therefore - I say therefore, for I consider the deduction as rigidly logical -what free trade, by proposing to limit our industry to cultivation and a few rude arts, really and in effect proposes and advocates, is national poverty. 115

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PROPOSITION XXXIV. XXXIV. Many arts can be carried on most advantage ously in large masses, requiring large capital and many hands  It is accordingly desirable that there should be in the community large aggregations of capital. A recent tourist * observes, as he supposes, a diminished productiveness of agricultural labor in France, by reason of the partitions, and repartitions, of the lands into small allotments under the present French law of inheritance. It is very easy for a tourist to be mistaken in what he supposes himself to witness, for he does not always know how to distinguish what he brought from home in his mind’s eye, from what he really sees abroad, but there is, I suppose, no question that some species of cultivation can be carried on with more economy, and in a better system, in large than in small proprietaries. The lake country, and the valley of the Mississippi, are said to present good fields for cultivation on a large scale. At any rate, many species of industry, especially some kinds of manufactures, can undoubtedly be most advantageously conducted on a large scale. And it is plain that whatever causes, whether legislation, foreign wars or peace, or short crops abroad, or credit and confidence at home, promote our domestic industry, will operate favorably on that conducted in large masses on a broad scale, as well as that conducted on a narrow one. Nobody proposes to prohibit by law the carrying on of transportation in a great ship or steamboat, or on long railroads, or of manufactures in great buildings at waterfalls on deep rivers, costing fifty or one hundred thousand, or a million of dollars for dams and canals, or the tanning of ten thousand hides in one establishment, or the cultivation of * Musgrave’s Parson, Pen and Pencil.

London Ed., 1848, v. 3, p. 92. 116

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PROPOSITION XXXIV. more than a hundred acres by the same proprietor. Every one, then, as I presume, contemplates large industrial concerns, where persons can find their account in forming them. You desire that industry should be productive, and, therefore, that great aggregations of capital should be formed for conducting it, where its productiveness may be thus promoted. Your theory, then, demands wealthy individuals to carry on production on their individual account, and that large masses of capital should be formed by contributions by members of industrial associations, no one of whom has himself sufficient means separately to prosecute the same business advantageously. A large concern can employ one man in inventing, and another in engraving, new designs. In Lancashire, England, some concerns employ an inventive artist on a salary, to make improvements in processes and machinery. Such expenses can be incurred only in extensive concerns. You will not understand me to be maintaining, that all industry can be carried on most beneficially to the country in great systems. The very magnitude of the undertaking, as we witness in a thousand instances, is the cause of failure. My position is, that in some localities, and under certain conditions, certain branches of business may be conducted in a great system, most advantageously to those concerned, and to the country; and, further, unless the intelligent Anglo-Saxon energy of the people shall be killed by a fantastical, empirical, unprincipled legislation, or their industry crushed by the perverted administration of the law, unless, in short, we are destined to a degrading transformation, we shall continue to witness large enterprises in divers arts and modes of production. And who, but a person infatuated by some whimsical singularity, can wish the contrary? We agree, then, for so I take to be the fact, that the 117

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PROPOSITION XXXIV. people of these States should still continue to have the privilege of undertaking large enterprises, and extensive systems of production. We also agree, of which I cannot persuade myself to doubt, that such undertakings, on the whole, materially extend industry, and are essentially necessary in order to carry the useful arts to a high degree of improvement. We agree, thirdly, that everybody, rich, poor, middling, of this trade or profession or that, whether one of the ninetynine workers, or the one, or less, in a hundred, depending on income, and not seeking or pursuing an employment, (substantially every man woman and adult child in the United States,) is benefited directly or indirectly by such extension of industry, and multiplication and high improvement of the useful arts; and is so benefited in proportion to his interest in industry, in his capacity of producer, or consumer, capitalist or laborer, undertaker, or party employed; or, if you question the proportion being the same, though this you will probably concede to be true in the long run, still you will not deny that every one is benefited; and no one is likely to quarrel with his own benefit, because he supposes that some other, owing to his particular circumstances, happens to derive a greater, any more than he would wish to divert a stream from irrigating his own lands at all, merely to prevent its irrigating his neighbor’s more. I am not presuming on a concession of anything obscure, ambiguous, theoretical, or doubtful, but only what every person ordinarily expresses, and constantly implies in his conduct. Every one then, who regards his own interest, (as who does not?) desires that production should be conducted on a large scale, by individuals separately, or by associations, as the case may be, where it can be so carried on more successfully. He, therefore, considers it to be materially ad 118

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PROPOSITION XXXIV. vantageous that capital should be possessed by individuals, or contributed by associations, for that purpose. What then is the meaning of the outcry made on the subject of protection by some demagogues, from 1820 to the present time, against “capital,”

“capitalists,” “corporations,” “the rich few?” etc. Is it then a crime to establish a great system of industry, or contribute to it? Is it true that every one of that glorious multitude of young and middle-aged men, the pioneers in physical and intellectual industry, who is impelled by a generous ambition to acquire a competence, or to found or increase his fortune, and, in so doing, keeps in motion the productive energies of the country, is guilty of a crime? I understand the demagogues and Mr.

Secretary Walker,* who denounce the possessors of property, to impute a misdemeanor - an offence against society perpetrated or attempted-to all who possess or strive to acquire property. Those who thus stigmatize the wealthy for being such, are not sincere, for many of them are of that class themselves; or, if not, they hope to make themselves so by dint of railing against the wealthy, and thus getting some lucrative appointment.

But they apply these denunciations to manufacturers. They do not, perhaps, intend to vilify a professional man, an office-holder, a cultivator or trader, for being wealthy, or endeavoring to become so. It is the manufacturer, the master-mechanic, the contractor for large jobs, who employs others, and tries to make a profit thereby: he is the offender.

This sort of phraseology is addressed with malignant motives to the malignity of sordid minds. But it is too palpably false, and the hypocrisy and malignity is too visible, to be acceptable to any but such as wish for some pretence to afflict themselves by cherishing bad pas * Report, 1848.

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PROPOSITION XXXIV. sions. It supposes the existence of fixed, distinct social classes in the community, which is a libel upon our institutions, and a contradiction of every day’s experience; and no sensible honest man can be persuaded of any such lasting distinction, when he sees all about him, persons transposed from good to bad, and bad to good condition; some slowly or rapidly bettering themselves, others sinking, according to their habits and fortune; the son of a wealthy man a beggar, and the son of a beggar wealthy. In all these changes, an industrious man, not overtaken by some misfortune - and there is no guarantying everybody against that -though his competence consists solely in his faculty for industry, feels that he is no more nor less dependent upon those by whom he is employed than they upon him.* The drivelling declamation of well-clad demagogues, about the rapacity of the wealthy, and oppression to the poor in this country, is addressed to the only civilized people in the world among whom there is no class of men that can be oppressed. The reason is, that circumstances, and the character of the people themselves, have combined, hitherto, to keep up the rate of wages in comparison with the necessary expenses of living. The immediate and certain consequence of free trade, would be, as we more plainly see under subsequent heads, to reduce wages, and render those dependent whose only capital is labor. You reply that “The denouncers merely assert that protection favors those persons now engaged in carrying on the branch of industry protected, and these are the rich intended * I remember having heard of the following dialogue. “So, your employer has turned you off? ” “No.” “I heard so.” “Not at all. I have turned off my employer.” This reply illustrates the relation in which most of our people consider themselves, more truly than the contrary would do. 0 120

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PROPOSITION XXXIV. by the declamation.” -It is then a two-fold misrepresentation. It supposes those concerned in carrying on the business of the useful arts, to be rich in comparison with others, which is not true. Persons so Concerned are of all degrees in point of property, from the manufacturer who braids his own little stock of leather into whips, or shapes his own little stock of wood into whip-stocks, or reeds, or shuttles, or bobbins, through all the intermediate grades of those who employ their own families, or one or two hired hands, and so on to the one who launches great steamboats from his shipyard, or turns out great masses of cloths or metals from his factory. The epithet rtch is probably less applicable to them, in general, than to merchants and agriculturists. The same declamation implies also, that persons concerned in carrying on the arts, ask some preference to themselves over others - that government should do for them what it should not do for others - which is utterly false. They put forth no such claim. It is also expressly said, that they demand a legislation that shall enhance profits at the expense of labor.

This is a subject of consideration under other heads. But suppose that every manufacturer, that is, every person in the United States who carries on any species of production, except that of raw materials from the soil, were rich. Is he, therefore, an outlaw? Such persons comprehend a large portion of the whole number of our citizens. Are they disfranchised? The government was constituted expressly for the protection of the persons, the property, and the industry of the citizens; not this one nor that one in particular, but of all the citizens; and all the inhabitants, whether citizens or not. And every one has a legal right to present to Congress any subject that concerns the general welfare, and if the matter concerns his own interest also, 11 121

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PROPOSITION XXXV. this is an additional reason why he is the proper person to present it, and also to be heard upon it. The freetrade concocters of the tariff of 1846, went upon a different rule. A distinguished member of Congress from Tennessee signalized himself by moving that no communication should be admitted from manufacturers, that is to say, persons constituting and representing about two fifths of the whole population of the country; and the projectors of that stain upon our statute-book, I mean that tariff, instead of consulting with citizens of the United States, whose interests were involved in the prosperity of the domestic arts of the country, took counsel of the representatives of foreigners, who considered it to be for their own advantage to destroy these arts.

These are, however, topics only incidentally connected with our present proposition, viz.: that, since some kinds of business can be most productively carried on upon a large scale, and everybody is benefited by the successful prosecution of useful industry, and it can be so carried on only by an individual or an association having a large capital, it is desirable to everybody, that there should be such aggregations of capital in the community. XXXV. Protection to the arts promotes agriculture; is essential to its prosperity-Contrary pretence of free trade. We have seen that the hollow basis of the freetrade theory consists of at least eleven postulates, each of which is essential to its support, and every one of which is a fallacy. As we proceed in examining the sundry pretences alleged in its support, we have found and shall find, that every one of, them, excepting the pretended danger of committing 122

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PROPOSITION XXXV. insubordination to Great Britain, depends directly upon one or more of those eleven fallacies. These postulates and pretences, without that exception, are all like those figures inclosed in the old Etruscan sepulchres, which crumble the moment light is let in upon them.

Some, at least, of the pretences are not made sincerely. There was a great demand in 1847 for our breadstuffs and provisions in Great Britain, to fill the chasm consequent upon the short crops there. This export was seized upon by the freetrade politicians as one of the beneficent effects of the tariff of 1846.* Such pretences show the insincerity of those who make them, and that they do not themselves really and honestly believe in the theories they promulgate. It is a harmless conceit, for surely the people of the United States, though they may sometimes be imposed upon by a fallacy, at least for a time, cannot be made to believe that the tariff of 1846 caused the potatoe rot in Ireland. And if it could have that unkind effect every year for a century to come, the market thereby created for our agricultural produce would be a very small matter in comparison with that afforded at home by the protection and consequent extension of our domestic useful arts. The notion insisted on for thirty years past,t and so painfully elaborated by Mr. Polk and Mr. Walker, that protection of the domestic arts is so prejudicial to agriculture, is a fallacy worthy only of an unscrupulous advocate of a bad cause. Agriculturists cannot live wholly on their products. They must, in general, sell at least two fifths, that is to say, over 400,000,000 dollars’ worth annually at home or abroad, in order to maintain their present mode of living. By abridging their comforts and luxuries, they might de * Walker’s Report, 1848. t See Examination of Baldwin’s Tariff. New York, 1821, p. 1121. 123

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PROPOSITION XXXV. pend more upon their own products, but this they have no motive or inclination to do. They can send abroad but about 100,000,000
worth, including cotton, which is somewhere near one half of the exports.

The remainder is mostly breadstuffs and provisions. Were we to abolish all our arts excepting those mechanical ones that are indispensable to a community of cultivators, we could not send abroad anything more, except the amount that we ourselves should take back again in the shape of manufactures; and that increase, were it possible, would not be equal to one quarter of the amount of domestic manufactured articles of our own that we now send abroad in part pay for imports. If we adopted Lord Chatham’s limit, now so urged upon us by the British patrons of our industry, not to make even a hobnail for ourselves, other nations would not, therefore, want any more of our flour and provisions, for their own consumption. And we could not, in fact, continue to take so great an amount of their manufactures as now, for the reason that we could not then pay for them. We could only run up the bill increasing for half a century, of which Adam Smith speaks. The doctrine of free trade, that the foreign market is to be relied upon in preference for the consumption of our agricultural products, rests wholly upon the fallacy, already exposed, of the boundlessness of that market. Though we cannot, by abolishing our arts, or in any other way, create a foreign demand for a greater quantity of agricultural products, we can and do create one at home, and this we can increase ad libitum, for a century to come, by well-timed, well-applied, and well-proportioned protection. We have means of doing so, not possessed by any other equally civilized people. No European nation can supply the common necessaries and comforts of life to its 124

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PROPOSITION XXXV. inhabitants at a cheaper rate. By cheap rate, I mean a large quantity for the same amount of labor. This state of things will continue, so long as the rate of wages is sustained; and the only way to sustain wages, is to extend the useful arts by protection as heretofore.

We have abundance of territory within our own limits for enlarging the cultivated area every year, for at least a century to come, but that cannot be so enlarged without a proportionally increasing market; and only persons engaged in other pursuits than agriculture can furnish this market; and such persons cannot be had abroad: they must be sought within our own limits. “Why not just as well abroad?” you ask. “Why is not an English, German, or French mechanic, just as good a customer as one at my next door?” For the reasons that are really too obvious to need to be expressed. He will not take your timber to construct his dwelling, your wood or coal for his fuel, your meats, roots, vegetables and fruits, for his table. He will not take his clothing from other neighboring American artisans, and thereby help to employ them, so that they may also be customers for the products of your land. This has been often said, and it surely must be plain to every person of common capacity, though he should never have heard it said. The apology for repeating it is, that I understand it to be flatly denied by Mr. Polk, Mr. Walker, and the other promulgators of the doctrines of free trade; for the precise question is, whether the foreign or domestic artisan is the best customer to the cultivator, and they say the foreigner is the best. “But no,” you say, “we only assert that the foreigner will give a greater quantity of his work, for a cord of your wood, or bushel of your corn or fruit.” Suppose it to be so, if the articles could be sent to them, and they would take them when sent. But the truth 11* 125

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PROPOSITION XXXV. is, that many of the articles of a perishable nature, which would be taken by a neighbor customer, cannot be sent abroad, and of those that would bear transportation, a very small part, if any, of our surplus, beyond our present exports, could find any market abroad. The fallacy consists, therefore, in recommending to the farmer a customer to whom he cannot send some part of his products, and who will not take that which can be sent. Fifteen years is not too far for a legislator to look ahead, and in that time, at the present rate, population will increase some fifty per cent., that is, ten millions or more. These ten millions cannot go into agriculture, and trading in its products; if they could possibly do so, those products, whether cotton, wool, tobacco, rice, flour or whatever else, would be turned out in superabundant masses, and the price so reduced that the producers could not afford to raise them, even though the price of land should fall to one half of its present rate.

Three fifths of this increase will be a large allowance for agriculture.

Protection of other arts will give employment for four additional millions of consumers of the increased quantity of agricultural products. This gives an additional demand for those products, gradually increasing, pari passu, with agriculture, till at the end of the fifteen years, it amounts to one hundred and twenty millions of dollars annually. I am estimating the whole expense of living to each inhabitant, at fifty dollars a year in round numbers, without adding anything for accumulation. There should be an addition for that. And I compute the consump tion of the value of the products of the soil, to be three fifths of the whole amount of consumption. If this computation is not satisfactory, adopt any one that may be so, and substitute the result, which it will not be possible to bring out at an amount that will not fully sup 126

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PROPOSITION XXX~V. port my inference. This inference, which seems to me to be irresistible, is, that this additional demand for, and consumption of, our agricultural products, the whole of which is absolutely necessary to our agricultural and horticultural prosperity, must be sought fo)r in our own domestic market, and can be had there by protecting and fostering our domestic useful arts; and that this is the only possible way of obtaining it. The most imaginative eulogist of the great bargains to be made abroad, in free trade, cannot conjure up, in his fancy, any other way that will not be as extravagant and impossible as the eastern mythology. The result of reflection, reasoning, past experience, and observation of the present, is, that our own fellow citizen, employed in other arts, is the great and only reliable customer for our agriculture; and that this customer can be secured by protecting and encouraging such arts, and in no other way. “A piece of fine cloth weighing eight pounds,” says Adam Smith, “contains in it the price, not only of eight pounds of wool, but sometimes of several thousand weight of corn, the maintenance of the different working people and their employers.” Which will most promote the business of a farmer in Ohio, the importation of the “several thousand weight ” of German corn, in the form of the eight pounds of cloth, or selling several thousand weight of his own corn, to be put into the form of eight pounds of cloth, made in his own neighborhood’? t Quoted Colt. Pub. Econ., N. Y., 1848, p. 437. t See Hudson’s Rep., Committee of Ways and Means, 1848. 127

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PROPOSITION XXXVI. XXXVI. The maintenance of our institutions, and the wellbeing of the whole people, depend on sustaining the rate of wages. “It is neither the increase of population,” says Sismondi, “nor the increase of labor performed by that population, which constitutes the wellbeing of society, but the proportion between population and property, and the equitable distribution of the income whose source is labor. Society is happy when each one, according to his condition, can enjoy content and ease; it is happy when wages are high, because the poor are not obliged to work every hour of the day in order to exist.” * Dr. Pickering, in his report on the races of men,t says that the missionaries at the Hawaiian Islands, consider it a great obstacle to the civilization of the inhabitants, that in their limited notions as to style of living, they are content with “a little fish and a little poi.” It is especially desirable in our community, that those whose only capital is their capacity to work, should, as well as others, have some privilege for education, and enjoy some leisure, and some of the comforts and gratifications afforded by the arts of civilization. These cannot be secured to them by merely positive order of law; nor can they themselves secure them by mobs, and strikes, and conspiracies, for these are attacks upon all the rights, and the wellbeing of all members of the community, whereby they make themselves the first, and greatest sufferers. If they prevail, they can, at the best, like Sampson, but bury themselves in the common ruin. Such a state of things can be brought about only by the spontaneous legislation of opinion, sentiment, usages ‘Essays on Political Economy, Lond., 1847, p.

215, 216. 128 tP. 89.

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PROPOSITION XXXVII. and habit, aided by the tendencies and consequences of the prescient provisions of the statute-book. At any rate, we all agree in the present proposition, viz., that the wellbeing of the masses should be cared for, and that the rate of wages has a predominating influence upon it. Southern proprietors have a double interest in sustaining the general rate of wages, for the value of one great mass of their property depends upon it, since it is the capacity of the slave to earn wages that constitutes his value, and of course, the higher the rate, the greater is that value. Therefore, if the tendency of free trade is to reduce the rate of wages, and that of protection to sustain it, the latter is, in this respect, the true policy of the country; and the influence of such policy upon that rate, is our next subject of inquiry. XXXVII. Protection favors the working classes; is for the benefit of both the many and the few -

Free trade represents it to be for the few only. Free trade pretends that protection and promotion of useful domestic arts, are prejudicial to the interests of labor, as well as to those of agriculture. It is hard to say which of these pretenees surpasses the other in extravagance. To believe any one, who is given to science and thought, to be sincere in such assertions, is to maintain his honesty at the expense of his understanding. The assertion, however, though fallacious, implies the importance of these interests. In this we all agree. Useful labor is the common and richest inheritance of man, and it is an accursed policy that would hinder him the enjoyment of it, or despoil him of its fruits, whether such policy be ecclesiastical, predatory, tyrannical, or economical; and it is the most cruel to those 129

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PROPOSITION XXXVII. who have no other capital for their support, not having as yet realized its surplus proceeds in any form of accumulation.

The magnitude of this interest of industry may be made apparent at a glance. The portion of this community, male, and female, ready to labor in different useful employments, we will estimate to be eight millions, after deducting the too young and too old or infirm for work, the idle deadweights, the vicious, and the depredators. Let them be able to realize annually, at the existing rate of earnings in the various industries, within doors and out of doors, the average amount of $100, each, deducting nothing, of course, for the expense of their support, for one great object of their industry is to defray that expense. We have an annual result of $800,000,000, that is, more than five times the whole amount of exports to foreign countries. This is the great interest in question, being more than forty times the amount of all the profits annually made in foreign commerce, estimated at the rate of twelve and a half per cent., and according,ly, the augmentation of this industry, one fortieth part, by judicious legislation, or a diminution of it in the same ratio, by sinister legislation, such as that adopted on the motion of foreign merchants and manufacturers, seconded by our own freetrade partisans, will affect the wealth of the country as much as the gain or loss of the whole net profits of our whole foreign commerce. Such is the magnitude of this interest, from which we shall readily see the tremendous consequences that may follow from the aye or no of the legislator, or a stroke of his pen. We may safely adopt it as a general rule, that whatever affects industry, touches a vital part; and the effect of a policy in promoting or checking industry, is a test of its being useful or hurtful. 130

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PROPOSITION XXXVII. Does protection, then, promote or hinder industry? Is its tendency to supply employment for more or fewer workers? The question of its effect upon the price of articles consumed by the worker, is for another place; the proposition here is, that protection augments employment, and, therefore, makes a greater demand for work of all kinds; and consequently, since the price of anything is kept up by its being in demand, and can be kept up in no other way, protection sustains the rate of compensation for work. How does this appear? It has already appeared in treating of the effect of protection upon agriculture, and is in fact too obvious to require proof or illustration. The object of protection is, to employ artisans residing in the country to make those articles for us that we cannot obtain from abroad, because foreigners will not, and cannot, take a materially greater quantity of our exports than they already take.

We already send, besides our other exports, more of our gold nd silver than we ought to spare from our own currency and other uses; and, therefore, have no means left of obtaining from the other continent, or the other hemisphere, the additional quantity of things we need for our necessities and conveniences, over and above all the exchanges that we can possibly make abroad. Or, if you please, we can supply ourselves with our necessaries and conveniences, but desire to add some luxuries, and have abundance of men ready to employ themselves for that purpose. Cultivators also wish to extend their cultivation. The Western farmer wants to raise more wheat, or more pork-the Carolina planter more rice -or the tanner of the middle or northern states to tan a greater number of hides. The foreigner can take no more of these, being already supplied. In either case, by the operation of protection, we detail one out of a hundred of our working men, whether those who employ themselves 131

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PROPOSITION XXXVII. upon their own materials, or are employed by others at wages, to produce the additional provisions, and make the additional quantity of articles wanted. Does not this increase the demand for labor, and, consequently, sustain wages? It in fact fills a vacuity. It gives something where we should else have nothing. This is the creative effect of protection, judiciously applied. This is the ordinary normal condition of this country. We have filled every corner of the world with whatever its inhabitants will take and can consume, of our raw products; and still we have a surplus on hand, and at the same time, wish to extend the production. The world cannot open a market for us outside; our only resort, and the most fortunate one to have, where to open the requisite market, is within ourselves, by opening which we make room for labor and its products, and thereby sustain the rate of wages. If a neighboring artisan supplies us, instead of a German, he consumes more of our domestic products of all sorts than the latter could, and supplies employment for others, and thereby assists to sustain the rewards of industry. You may, perhaps, say, that this operates unequally on the different sides of Mason and Dixon’s line. It does so; but when we ascertain that a policy is decidedly the best for the whole, broadly considered in its general and permanent operation, it should over-rule inconsiderable, temporary, and partial inequalities, of which there always will be some, and they will fall now in favor of this party, and then in favor of that, so as in the long run, to be fairly balanced. On one side of that line, a citizen has an exclusive right only to his own industry, on the other, besides his own, he has the exclusive right to that of another. Whatever policy, therefore, enhances the value of labor, and sustains the rate of wages in the country, operates in favor of the latter in a 132

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PROPOSITION XXXIX. double ratio. But, were we to boggle at every such local incidental diversity, we should never move a step in either public or private affairs. XXXVIII. Free industry, preferable to industry fettered by free trade. The people of this country, excepting a small number of persons, who claim exemption from labor, in virtue of their vices or incapacity, have their capital partly or wholly in their faculty for labor. Action, physical and intellectual, in useful employments, is the source on which they depend, and free booty, free quarters, free trade, or any other species of freedom, that deprives them of the use and fruits of this capital, is not freedom but impediment to them. They need the legislation that shall extend and promote arts, and thus, by enlarging the sphere of industry, secure to them the privilege of working at fair wages. This, as we have seen, can be done only by the protective system.

Free trade is the real restrictive system. XXXIX. Our extent of territory and variety of climate enable us to extend arts, and thus sustain wages-The effect of free trade is stagnation of industry, and con sequent reduction of wvages to the European level. Nothing can be done in mechanics without a sufficient power to put the machinery in motion. The people, in matters of public economy, are what a power is in mechanical operations. If you have not at the bottom the right physical, moral, and intellectual endowments, civilization can, at the best, make but little progress. No one will 12 133

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PROPOSITION XXXIX. complain of any deficiency in our people for productive pursuits. We have an immense territory to work in, including a rich variety of soils and products, adapted to supply necessary food, clothing, and shelter, at a moderate expense, not subject to be enhanced for a century to come, that is, not until our vacant territory shall be fully occupied for improvement, which will probably require that period, even under circumstances the most favorable to the increase of the population.

Until the expiration of that period, we have within our own limits, all the material elements of growth and strength, and have no occasion, except in the true spirit of chivalry, to enter the lists of free trade with any nation whatever, to decide in open battle, which shall triumph and gain the market for the products of all the arts, except those of agriculture and fishing; and which be condemned by defeat to the hewing of wood, and supplying other rude products of the soil and the waters. It will be time enough to go out on such an adventure, when, if ever, the rate of wages in this country, shall have put our arts on a footing of equal competition, in this particular, with those of the challenger, or the party that we may in such case ourselves challenge. At present our rate of wages is high, and the great and indispensable necessaries of life are now, and for many years to come will continue to be, low, whatever may be the course of legislative policy. But though the products of the soil and the waters are low, our institutions and the wellbeing of our population forbid a sudden and forced reduction of the rate of the earnings of industry. If the view taken under previous heads is just, free trade has a direct and inevitable effect to diminish the means and demand for industry, and consequently to reduce the rate of wages; and protection infallibly sustains wages. If we had 134

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PROPOSITION XL. already passed over all the descent in social deterioration of the condition of laborers for hire, and found ourselves on the European level, with three quarters of the population like England, or nine tenths like Ireland, destitute of property, and dependent on the wages, larceny or alms, of each day, for the food of the day, and the wages were at the lowest point, so as barely to suffice for maintaining existence, it would then be no treason against the rights of the destitute, to put them upon a level with their foreign competitors. But to precipitate them into that condition, is an inhuman policy, and it is that of free trade. XL. Vicinity of artisans and cultivators is a great mu tual advantage to both-Free trade puts them to great distances from each other. It is profoundly remarked by Hamilton, in his report on manufactures, that it is a great advantage to those to be supplied with the products of any art, to be near to the place where it is carried on.

Every man has constant experience of this truth, in his greater or less distance from the shoemaker, blacksmith, trader, school, the physician, or practiser of any art or species of industry, with whom he exchanges the products of his own labor. The parties are known to each other, and each has a reputation to maintain, which promotes fair dealing. The facility of communication is a great matter. A person in the midst of the practice of an art, is a better judge of the quality of its products than those at a distance, since he is in the habit of seeing a greater variety of its products than those who depend on a far-off supply. What is considered to be a good silk fabric here, is counted very ordinary 135

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PROPOSITION XL. at Canton. The English, a few years ago, put into the market what appeared to be a facsimile of an American cotton fabric, and put it into the American, as well as other foreign markets, at a lower price, and drove out very much of the American article from our own, as well as other markets. But, on trying the substitute, the similarity proved to be only apparent, arising merely from the finish, and wearing and washing proved it to be sleazy, and it was given up after the first year in the United States, for the people here, being in the vicinity of manufactures of the kind, had become quick observers and good connoisseurs of the quality of such fabrics; but abroad, in countries where there are no manufactures of the sort, the British article was not so easily displaced.* I suppose I shall be entirely safe in making inferences from the fact, that the vicinity of mutual producers and consumers to each other, is very advantageous to both, in many respects; a fact to which we should probably arrive by reasoning a’priori, though we had no specific example. Protection tends to bring the parties, who mutually exchange with each other the products of their labor, near together. Free trade not only tends, but expressly professes and endeavors, to put them on opposite sides of the Atlantic. * I have this from a gentleman whose name would be good authority. 136

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PROPOSITION XLI. XLI. Protection operates for the beneft of those in the interior in a far greater ratio than for that of those near to the coast and ports - Free trade tends to make a few great commercial towns, and a thinly settled poor interior country. I was the other day informed by a gentleman from Chicago, that a company in the interior of Illinois are putting up a woolen factory. It struck me as not being a wild notion in those projectors to undertake to make the wool, grown in their own vicinity, in a factory on the spot, (supplied with building materials, provisions, and fuel, by near proprietors of land,) into cloth to be worn in the same vicinity. And when I recently met with a machinist on his way to Alabama, to set up the machinery of a cotton-mill there, it seemed to me not at all wonderful, that the idea of putting such machinery in motion there, should occur to an inhabitant of that state. It is possible that Mr. Walker, in his next Secretary’s report, may remark on the folly of the undertakers of these enterprises, as he did, in his last, on that of those who supplied the country with such cloths as they could make on the spur of the moment, during the last war, when nothing could be brought from England, and whose establishments had gone to ruin after the peace. It may perhaps prove to have been unwise, to trust to the wisdom of our legislation the contrary is, however, to be hoped. These two instances may serve as illustrations of the general tendency of certain descriptions of arts, to migrate into the interior. Mechanic arts follow the example of agriculture; in both cases, those on the frontiers of the region already occupied, are the pioneers in the new. The first step in every art, as well as science, is, to learn what is 12* 137

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PROPOSITION XLI. already known, and this is most easily done by those who are’in greatest communication with the present masters. Some arts were brought into this country by the original settlers, and additions have been made to them from time to time, for two centuries and more. In the early stages of an art, the Europeans are our instructors; and we, in many cases, import the artist himself, and learn his arts from him practically here on the spot, and employ him until he becomes perverse and impracticable, as not unfrequently happens; and then let some of our own people take up the art, and go on with it, until it is brought to the degree of improvement already attained in Europe, and then we are just as likely to repay them by our further improvements as to avail ourselves of theirs. The art being once naturalized at the centres of foreign intercourse on the coast, is then easily communicated to the interior.

This is the process that has been going on now for twentyfive years, at one time briskly, then sluggishly, according to the state of business and of legislation. The proposition of Mr. Polk and Mr. Walker to abandon all our acquisitions in this form of civilization, and relapse into the rudest agriculture and arts, after the colonial model, is parallel to the rash, perilous caution or party hostility of some of our statesmen in the affairs of individual states, who, when a state had deeply implicated its credit and resources, in a hal -finished railroad, proposed to stop short there. Certain species of arts, in certain degrees of their improvement, thus pass from point to point in the interior, and, in the natural course of things, this proceeds until manufacturing arts and processes, on a small scale and large scale, according to the circumstances, are gradually disseminated throughout the country, and brought into proximity to agriculture and horticulture, each one auxiliary to every I..15 8

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PROPOSITION XLI. other, throughout our territory, from east to west, and from north to south. Which then, in the long run, is most benefited by this propagation of the arts, the interior or the seaboard? Evidently the interior; for suppose we stop midway, or according to the inculcations of Mr. Polk and his Secretary, and other counsellors, the representatives of foreign manufacturers, and the whole corps of thorough-going disciples of free trade, we relapse into a merely agricultural and grazing country; a nation of husbandmen, herdsmen and shepherds, spread over the whole breadth of the continent, relying upon the discovery of an abysm of a market in some remote region, that would be always open for such a vast export, rivalling the icebergs in magnitude, if it all could float in so large masses; and return us a great profit in manufactures. This, chimerical as it may seem, is precisely and literally, the vision of free trade.* Who then, have the best chance in this exchange of our raw products for the manufactures of the artists beyond sea, the inhabitants of the coast, or those of the interior? Plainly the former, for all the raw products from the interior must go through their hands and pay them a commission, on their destination to the foreign market; and all imports taken in exchange must also pass through their hands on their way to the consumer in Illinois or Minesota, and pay them a commission, and be chargeable with the land transportation besides. The result necessarily is, that those near the coast will sell their raw products ten to twenty per cent. higher, and obtain their im * In case of doubt, see Mr.

Secretary Walker’s Treasury Report, 1848; I might also add, see the freetrade writings, passim. I refer also to the previous head on the subject of the foreign abysmal markets, that caninot be glutted or sufficiently suppilied -universally supposed to exist, and taken for granted, by all the freetrade writers. 139

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PROPOSITION XLI. ports ten to twenty per cent. lower, than the victims of free trade residing between the Alleghanies and the Rocky Mountains. But suppose, in consequence of the protection and encouragement of our own domestic industry and arts, the business of making the ordinary substantial articles of use and consumption, which constitute, in fact, the greatest bulk and value of the whole consumption, becomes disseminated in the interior, in all the various localities, according as each is best adapted to any particular product of the various arts and trades. In that case, the inhabitants of the interior will be supplied with all the pain domestic products to which their vicinity is adapted, at as cheap a rate as those .near the coast; and, in many articles, at a cheaper rate, by a difference of ten to twenty per cent. This ought to be a strong argument in freetrade reasoning, which goes wholly on cheapness; but it does not come within the limits of that logic which is confined to the present money price exclusively, and contemplates nothing but foreign imports to affect price, as already shown under other heads. The system of duly applied protection, and of the progress of American industry, that is, of progressional civilization, considers the other direct effects of such a dif fusion of the arts throughout the country, as of much greater importance, for it gives a near and steady market in every part of the country for the products of cultivation, influenced, it is true, by the rain and sunshine of the surrounding country, as it must be, but not dependent upon the short crops, war and peace, and other vicissitudes of the distant quarters of the globe. It brings the producers and consumers of a great variety of articles into vicinity to each other, in every fertile ten miles square of the country, each locality sup plying itself with the products of agriculture or arts, to 140

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PROPOSITION XLI. which it is adapted. It augments employment, stimulates invention, encourages improvement, gives facilities for social intercourse and education, in every interior locality that has any basis of growth, either in its soil or situation. These are the circumstances that tell in the wellbeing of the people, incomparably more than the difference of twenty per cent., or thirty per cent., in the present money price of exchanged products of labor, whether that percentage be one way or the other. But the mere matter of profit and loss, estimated on the prices of articles bought and sold, will, under protection, in the long run, infallibly come on the credit side, in the interior, whatever may be its effect on the borders of the oceans, or great rivers. If a farmer makes a permanent stone-fence to protect his crops, he estimates, in his profit and loss, not merely the produce of the year, but the addition to the permanent value of the land. So it is in the introduction and improvement of the useful arts, the incidental and lasting results in a pecuniary estimate, make a great item in the account, and are more striking in the interior, where the value of every acre of soil, and every forest tree, and every fossil, and every raw product that can be used and consumed in the vicinity, is enhanced on the approximation of population, that is, of a market. If I am not mistaken, we have seen, under other heads, that useful arts are multiplied and improved by encouragement, and never did, and never can flourish without it, in this or any other country; and that it is the great function of legislation to foster them. And unless there is some very great error in the data stated under this present head, the interior of any great country, and of the United States especially, has by far the greatest interest in the protective system. 141

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PROPOSITION XLII. XLII. It is not expedient to put off the cultivation and practice of the useful and ornamental arts in the LUnited States, until the average of the aggregate money rates of rents, interest, and wages, is as low as in the rival places of production in Europe-Free trade teaches that it is expedient to do so. Free trade says we must have only those arts in which we can now, at the time being, come down to the European level in the money cost and price in our own market. Now, everybody knows that the cost of every article consists of rent, interest, and labor; and the proposition of free trade is, that we should by no means make for ourselves any article, the amount of the rent, interest, wages, and freight, going to the production, manufacture, and delivery of which in our market, is not less than those of the same article produced in any country in the world. In the present state of transportation, freight is a very trifling item in articles of any considerable value in comparison with the weight and bulk. In the belligerent hurlyburly to come off in Europe, by and by, when the question of civilization and barbarism shall come up to be determined between Russia, as formerly between Turkey, and the rest of Europe, and foreign freights and insurance shall be manifoldly enhanced thereby, then, according to the freetrade formulary, it will be quite expedient for enterprizing men, if there shall be such, to borrow of capitalists, if such there shall be, at the current rate of interest, the wherewithal to put up buildings, erect works, and employ men, and to devise and make tools, and teach workmen a great variety of new arts, manufactures, and modes of production, in order to supply the wants of the country, during the storm; all such 142

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PROPOSITION XLII. works to be crushed, and abandoned, when it shall have passed over, and the undertakers, lenders, artists, and laborers, buried under the ruins, as in 1816 to 1820. Mr. Walker* and other seilf-gratulating freetrade speculators, meantime pointing with complacent satisfaction, to such monuments of folly, and extolling the wisdom of free trade. But at present the way is open to the ends of the earth, and not infested by any commissioned waylayer, or “seasolicitor,”

and all races and tribes are neighbors, and pass articles to and fro with great facility, at very low freights and insurance. Accordingly, the competition of domestic and foreign industry is decided substantially, in respect to a vast proportion of commodities, by the comparative rates of rents, interest, and wages. Rents are of most material account in certain agricultural articles. Our money price of most products used as materials in the arts, is, in a very large proportion fully equal to or above the European, and in the rest a very little lower. The rate of interest and wages, which constitute a large part of the cost of the products of the arts, is in general nearly twice as high in the United States as in Europe. Interest cannot be brought down to the European standard, until after some years of the prosperous cultivation of arts and commerce, and consequent accumulation of capital. The promoters of free trade, therefore, expect to begin the introduction of the arts, if at all, by reducing wages to three fifths of the present rate. Is it not better to proceed now in sustaining and extending the arts, and thus, if possible, sustain wages at the present rate, at least for one or two centuries? *

See his Report, 1848. 143

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PROPOSITION XLIII. XLIII. It is not for the interest of the country to put off each useful art, until our own artisans have as great skill in it as artisans in countries abroad, where it has been practised for centuries-Free trade proposes that we should do so. It is plain that a less skilful artist will be beaten in a competition with one more so, all other things being equal. The British advocates of free trade, in leading periodicals, and their statesmen, in public addresses, claim a vast superiority for their artisans over those of other countries, in the useful arts generally, alleging them to be at least twenty years in advance. Our advocates of free trade say, that at the proper time our arts “will encourage themselves,” * and that it is altogether unadvisable to think of introducing any particular art into the United States until our artisans-of which, upon their system, we shall have none - have advanced in skill, equal to that gained by twenty years of assiduous study and practice of the art, in which, of course, they can have no practice at all. This is going beyond the maxim, that the boy must not go into the water until he has learned to swim, for it requires that he shall wait until he is expert enough to beat the best swimmer! How many centuries hence do the expositors of free trade calculate to be the time when the unaided, unpractised, useful and ornamental arts, would, on their system, effectively “encourage themselves” in the United States? * Walker’s Report, 1848. 144

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PROPOSITION XLIV. XLIV. A duty, however great, cannot operate to give any class of producers an excessive proft but for a short period-Free trade pretends that it gives a permanent advantage to the class. The duty on an imported article may be raised in such manner as, for a time, to give those engaged in the domestic manufacture of a like thing, a profit exceeding the ordinary rate in business generally. It may be expedient to do this, where there is a pressing exigency for the enlargement and full establishment of a branch of production. Such a stimulus to the domestic production of hemp, wool, or iron, would be advantageous, where great embarrassment and sacrifices were foreseen from the deficiency of the domestic production. That expediency is not the present inquiry. We will limit ourselves here to the proposition, that by raising the duties, the proft of the domestic production may be enhanced, where there was already some profit, and a possibility of one may be induced, where it was before impossible. This result may be accompanied by an enhancement of the price of the article to the consumer; or it may be effected without any such enhancement, as is shown plainly, I venture to say, under other heads. But we are not now occupied with this question any more than the other one of expediency, the case here in question being the fact of the enhancement of the profit of the domestic production by raising the duty on the imports.

So the profit on a domestic production may be reduced in consequence of a reduction of the duty on the importation of a like article, and the value of the investment, in the instruments and means of the production, may thus be annihilated or materially reduced, to the ruin of those concerned, as many have learned by experience. 13 145

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PROPOSITION XLIV. It hence appears how very important it is to maintain a judicious tariff of duties, which I understand to be one that is adapted and adequate to raise revenue and promote industry, according as the object is either or both. In all matters of financial policy, it is one great object not to embarrass industry, and if possible to promote it.

Where the principles-I repeat, the principles-of the system continue to be uniform, though their application should, from time to time, be revised and modified, there would never be those excessive enhancements or ruinous reductions of profits by the mere effect of an alteration of the revenue laws, that are sure to follow the vibrations of a system from one extreme to the other. If the public may be prejudiced by the sudden and excessive, that is, superfluous, enhancement of profits in any branch of production by reason of injudiciously raising a duty on imports, as certainly it may be; and if it may be prejudiced still more by an injudicious reduction, this is a reason for avoiding such extremes. If the determination is not to vibrate from extreme to extreme, nor to adhere to the medium of an adequate, and only adequate, rate of duty for both protection and revenue, but to abide forever in one extreme, the low one is incomparably the more disastrous, as applied to the United States, since it inevitably impoverishes the country, and reduces it to be a mere parasitic dependent upon a foreign one. A high tariff, applied to articles for the domestic production of which the country is well adapted (and nobody contends in behalf of any other) if steadily adhered to, can, at the worst, enhance profits excessively only for a short period, for, as all the world knows, profits tend to equality, and, in this country especially, where the people rush into new pursuits with great alacrity, the excessive profits of any branch of production are sooner reduced to the general level, than 146

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PROPOSITION XLIV. in any other whatsoever. And it thus appears, that so far as individual benefit is concerned,- the inequality of excess of profit, if it really exist, is but for a short period, and is, moreover, always followed by a corresponding reduction, or absolute loss, brought about by the domestic competition that is sure to follow. The danger of this consequence was one of Mr. Secretary Walker’s pretended objections to the tariff of 1842.* The enhancement of profits thus caused, when it is in fact caused, will be of longer duration in some branches of production than in others. I will not, however, go into particular consideration of its duration in one as compared with another, but rest with the proposition that it is necessarily temporary. The ordinary object of protection is not to give any such enhancement of the profit of any particular production over the average rate, but merely to sustain it, because it is, at its starting, (or was, forty, fifty, or sixty years ago at its starting,) decided to be for the interest of the country to sustain it. It is possible that, in so doing, under the circumstances, a temporary enhancement of profit to those concerned, will be incidentally occasioned by the measures that are indispensably necessary in order to sustain the business. If so, it is among the thousand temporary private advantages and disadvantages unavoidably incidental to all public proceedings. It is impossible to grant a right to make a railroad or canal, or to make war or peace, or extend a mail route, or do any other important public act, without incidentally benefiting or prejudicing some individuals for a time, or permanently. In such eases, the citizens thus expecting to be benefited, will promote the act, and those * Report of 1848. 147

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PROPOSITION XLV. fearing injury, will oppose it; and instead of making an outcry against them for so doing, you listen to what they say on either side; and if any foreigner, who has no interest in the matter by treaty or international law, or a title under our own law, but only a foreign public or private antagonist interest, should mix himself up in this matter, you would deem it obtrusive, and turn a deaf ear,* instead of listening to him, and advising with him, and turning a deaf ear to your own citizens, as was done in concocting the tariff of 1846. XLV. The merely adequate degree of protection should be adhered to-Pretence of monopoly. Freetrade writers speak as if protection was a sort of gratuitous grant to particular classes or persons. Such a representation is not surprising in inflammatory declamations addressed to bad passions and narrow prejudices, but is out of place in grave debates and treatises. A protectionist proposes the encouragement of a particular branch of business begun, or to be introduced, as being of public utility. He asks nothing for himself exclusively. He does not apply for a monopoly of a trade, or an exclusive right against other citizens, for the practice of a manufacture, or any branch of production, like the applicant for a patent. Let the proposition be, that certain descriptions of the products of the earth, or of any art, shall finally, after the production is fully domesticated and established, be supplied wholly from domestic sources; or let it be eventually to sup ply substantially the whole consumption of all descriptions * This was written before Mr. Bulwer put in the British protest against raising our duty on iron. 148

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PROPOSITION XLV. of an article from such sources-substantially the whole, not fully, for whenever, by reason of deficiency in the supply from home sources, the price is enhanced, this brings in imports. Thus, where the English or French send an article of new style, or new fashion, it will be taken at whatever price, until our own artists betake themselves to the same production, and thus bring down the price. So also, when either a foreign or domestic producer makes a great improvement in a particular art, as in experience actually happens, he takes his own and the foreign market, until his competitor adopts the improvement. In these considerations we plainly see a reason why protection should be only adequate to its object, namely, to give domestic production the opportunity of substantially and generally supplying the domestic markets, so that foreign competition shall be only occasionally let in for a time, under extraordinary circumstances. Now, some of the professed advocates of free trade, who have not bewildered themselves in the metaphysical abstractions of their school, often, impliedly at least, admit that this medium point is to be sought, and they are thus protectionists, for the protectionists on their side profess to propose, and no doubt generally intend to propose nothing more. The difficulty is to hit this just degree, which can be ascertained only by an intimate knowledge of the production of the particular article, and the trade in it. The principle of protection is to fix the encouragement at that point; or to let it be adjusted to that point from time to time in regard to articles in which the true medium is subject to successive variations other than the ordinary temporary ones, and thus effect a supply for the consumption, substantially from domestic resources. “Monopoly! ” says free trade. But, strike off the duty 13* 149

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PROPOSITION XLV. absolutely, and then the supply is perhaps exclusively in the hands of the foreign competitor, and so the protectionist may rejoin, “l]onopoly!” in the same sense of that term; though it is usually a perversion of the term to apply it in either case, for in each it is the right of contending with some hundred thousands of competitors for the supply of the market. It does not propose in either case to give, nor can it give, a lasting rate of profit to the producer of the particular article, above the average. In the outset, when the new production begins under encouragement held out, no individual in the community has any stake at risk. It is the legislation and the public wants, that invite a domestic supply; but not from A., or B., or C., but from the whole alphabet. Subsequently, individuals have some claims, which it is for the public interest, as well as a matter of fair dealing, to have in some consideration, as I propose to show under another head. Suffice it here to say, that protection proposes to hold out a sufficient encouragement to secure substantially and in general, a supply from domestic sources, either of particular qualities, or of all qualities of any kind of production; and if this be called a monopoly, it is better to give it to our own citizens than to foreigners, provided the country is well adapted to the production. Is it not this very monopoly that divers nations are seeking to obtain for the products of their industry, just as every producer and trader seeks for such a monopoly for what he produces or sells? The nation seeks command of the market abroad by underselling, and the individual at home by the same means. It is what Great Britain has been seeking now for two centuries since Cromwell’s time by protection; and what it is now seeking by great professions and some practice of freetrade doctrines. When a nation thinks it has a decided present advantage 150

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PROPOSITION XLVI. in supplying any market, it cries out for free trade in such market in order to keep such advantage; that is, to secure to itself this so-called monopoly. But the function of legislation is to be very differently exercised in respect to the domestic and foreign markets, as I persuade myself we have seen, and shall see plainly, under other heads. It is enough to say here, that an additional reason for giving domestic arts protection, is, that they may stand a better chance of gaining that sort of monopoly of the foreign markets, the importance of which to the national welfare, is so highly estimated by free trade. XLVI. The object of protection is to make the interest of the public and that of the individual coincide -Free trade pretence of restriction. We have already seen, plainly enough, that every man does not, as a matter of course, always see what is best for himself for the present and future, and pursue it; and if it be admitted that he did so, and also that the industry that each one chooses for himself is, under the then existing circumstances, best for himself and his community, it would prove nothing to the present purpose. It has no bearing whatever upon the question whether you shall encourage the home production of certain articles, by duties on similar imported ones, or by bounties and rewards, or by honors. For instance, a certain inventor, after exhausting his patrimony, and spending thirty years of his life under pecuniary pressure, or on the verge of want, in experiments for improvements in Reed’s nail-machine, finally hit upon a very simple effective one, the patent for which proved to be a good property, and afforded him a competence. The patentlaw gave him a motive to devote his energies, mental and 151

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PROPOSITION XLVI. physical, to this pursuit for thirty years, through all his sacrifices and privations, and under that law it proved in the end to be beneficial to him; and but for that law, must have been so obviously ruinous that he would not have so devoted himself; and you may, if you please, assume that it would not have been advantageous to the public that he should have done so. The law changes the circumstances, and then, what would otherwise have been disadvantageous, now proves eventually to be advantageous, both to him and his country. This instance serves not only as an illustration of the character of every well-devised law, or judicious public act or private act, in furtherance of any kind of industry, but also as an argument in favor of such laws and acts. Take another instance, not of a permanent public law, like that providing for patents, but of a special legislative interposition, that is, the application of a permanent principle of legislation to an exigency of the time. Some thirty years ago, the French had a discriminating revenue-law, whereby goods imported into France in a French ship, were subject to less duty than by a foreign ship. A ship-broker in Boston,* finding that all our exports to France went by French ships, on investigation readily discovered the reason, whereupon a petition to Congress was got up for a countervailing law, and such a law was thereupon passed,t whereby a fair proportion of the freights was restored to our ships. The freetrade theorists say, Let other nations pass as many protective and restrictive laws as they please; it is so much the worse for them; free trade on our side will countervail them all, and give us the victory. But neither the French government nor ours thought so at that time, nor was, nor is, the fact so. We ran right counter to the pretended tri f Act. 1820, chap.

cxxvi. 152 - Mr. Thomas Thaxter.

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PROPOSITION XLVI. umphant demonstrations of free4rade science, and thereby saved our commerce. This, say the professors, was restriction and coercion, and interference with industry, to countervail the like. True, it had a motive, as it always should have, and was intended to produce an effect upon industry. There was perceived to be an obstacle to a certain description of American industry and art; and a law was made whereby to escape or remove it. Denominate this restriction, or coercion, or licence and freedom, as you please, it was doubtless eminently expedient; and it may be equally so in case of other obstacles, whether occasioned by foreign legislation, or foreign policy, or superior arts or factitious advantages, or, in certain, cases, and to a certain extent, natural advantages. It is no reply to say that you may offer individuals too strong motives, and give them too great an impulse in some particular channel of production; for however commendable any particular line of policy may be, it may be overdone. You may ruin yourself, and thus injure the community, by deeds of charity; but this does not prove it to be a vice in all cases, and in whatever extent practised. The law, or the munificence of some association or individual, may, by its natural tendency, and the effect due to it under ordinary circumstances, produce excessive excitement towards an object, and this might be a reason why it should be modified. And on the other hand, where a motive ordinarily will have but just an adequate effect, yet temporary circumstances may give it for a time excessive influence, and at another time prevent its having due influence; this will not be any reason for modifying it. This comes under the question of more or less, excess and deficiency, which is no less applicable to the promotion of industry and the protective policy, than to a million of other laudable things. 153

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PROPOSITION XLVI. Our literature has been enriched by vast contributions of rhetoric on “restriction,” “the restrictive system” meaning that of protection and encouragement to our national industry. This application of the term restriction, like that of monopoly, already noticed, is a figurative use of a word denominated catachresis, unless such use of the terms is too remote from their meaning to come within that sort of metaphor. If the encouragement and protection of the products of any domestic art, are a restriction, by reason of their promoting the home production and diminishing the importation, then is complete free trade in the foreign products of the same art, doubly a restriction; for it not only prevents our merchants and traders from purchasing the domestic products, but also our own artisans from producing them. The restriction is against trade and production, both. The artisan desires to produce the thing, the trader is as ready to deal in the domestic as the foreign product, but both are prevented by the action or the neglect of the legislature. The preference given on the score of luxury and superfluity, will sometimes operate in favor of imports, and, at others, in favor of the domestic products, according as ornamental designs, gloss and finish, or advertising devices, or huckstering importunity, prevail from time to time, on one side or the other. But these do not usually determine the choice; I say, not usually, for sometimes, in very nicely balanced competition, they do determine the whole current to be permanently from foreign or domestic sources. If the consideration of the case of the consumer belongs in this place at all, it is evident that he is just as much restricted to the foreign product by free trade where that has the desired effect, that is, to extinguish the domestic production, as he is to the domestic, in the opposite result of 154

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PROPOSITION XLVII. protection. But I do not see that he is restrained in either case. I accordingly dismiss this matter of restriction as a mere metaphor which may be used as appropriately on one side as the other.

Whether the price of articles to the domestic consumer is more enhanced by protection or free trade, and what are the effects of each, in the long run, is considered under other heads. XLVII. The tendency of putting a domestic product into the market, is, immediately to reduce to the consumer the cost of the corresponding imported article. It has always been asserted by protectionists that the immediate effect of domestic production is to reduce the price of the corresponding imported article, and statistics have been given to prove it. The advocates of free trade do not admit this, but usually seek some other cause of the reduction, when they makle any allusion to this subject. But they, in effect, admit that the domestic production does reduce the price, and they make this admission in one of their leading topics; for they say that the introduction of imports more freely, reduces the price of goods of domestic manufacture in our market, and of course, vice versa, the introduction of domestic goods into our own market, in competition with the imported goods having possession of it, will have a like effect on the price of them, upon the same principle, the duty still remaining the same.

This frequently embarrasses the undertaking of a new manufacture. Thus, when an establishment for making lawns was begun about four or five years ago, the imported article was over twentyfive cents per yard, and after the domestic establishment was put into operation, the price fell 155

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PROPOSITION XLVII. first, in 1847, to twenty cents; in 1848, to sixteen; and in 1849, to eleven and a half. Whether this reduction was wholly the effect of the introduction of the products of the new establishment into the market, might be the subject of opposite opinions, but that this, if not wholly, was at least partially, the cause, will hardly be doubted, except by a person under a very strong prejudice; the additional quantity thus put into the market being very considerable. A similar effect has been noticed in very many instances, at least; I believe in all instances, without exception, when any considerable quantity of productions of domestic industry has been brought into the market in competition with the imports, and the price has thereafter been kept at a reasonable rate, as long as the domestic products have kept a place in the market. This consequence has been so frequent, and so apparent, that the partisans of protection have asserted that the invariable effect of an increase of the duty upon imports, so as to give confidence in the domestic production, is to reduce the cost to the consumer. However this may be, at least, you cannot but admit, whether you are willing to do so or not, that the introduction of a large quantity of any article into the market from domestic production, has the effect to reduce the cost to the consumer, whatever is the occasion of the introduction of such additional quantity; and, supposing the increase of the duty to be the occasion, the article may-I say may-notwithstanding such increase, come to the consumer cheaper than before; for if you admit, as you must do, that such a reduction may be thus occasioned, you cannot, without some data to the contrary, in a particular case, say but that the reduction from this cause, is more than sufficient to counter 156

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PROPOSITION XLVIII. vail the tendency of the duty to enhance the price.

But I stop short of this, the proposition being that the introduction of the domestic article has a direct tendency to reduce the cost to the consumer, and has this effect, except so far as it is countervailed by an increase of duty or some other cause. XLVIII. Protection favors those who use capital-Free trade those who have it to lend. One of the old commonplaces of freetrade declamation always has been, that protection favors the rich, and free trade favors the poor. We have seen under other heads how free trade favors the poor, its tendency in the United States being to give them leisure and starvation. The arguments for free trade in England are precisely those for protection in the United States, for in England the poor depend for their labor and their bread upon the foreign market for their manufactures; our poor, what few we have, and, also those not poor, who rely mostly on their own industry, depend mainly on the domestic market for employment, not upon the foreign. Our foreign trade is unquestionably of great importance; but the home market, as shown under previous heads, is the seat of our industrial vitality. Now the object of not merely protective legislation, but of almost the whole body of legislation, is to promote the use of capital, not hoarding, not the idle consumption of rents, though individuals have a right to these privileges.

Both the policy of the law and object of exertion for the general welfare, are to increase reproduction. I have already, in another article, stated what I understand by capital, and what may be readily comprehended to be so by every one, namely, the land, dwellings, fixtures, and all 14 157

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PROFOSTION XLVII. movable stock, tools, apparatus, and materials, all vendibles, including specie and excluding contracts; that is to say, whatever, in a pecuniary view, is useful and available beneficially to the community. The object, and, as I have endeavored to show, and I hope successfully, the demonstrable tendency, in this country, of protection, is to promote the use of all property whatsoever, and to bring into activity the industrial faculties and skill of every industriously inclined person whatsoever. It is objected by the freetrade advocates that protection favors manufacturers; that is, all the enterprizing men who carry on the useful arts, which are indiscriminately included in manufactures. Its object undoubtedly is to favor them and all others employed or interested any way in undertaking, superintending, or working in, any useful art, or in furnishing food, clothing, shelter, or materials to them; that is, in short, everybody in the community, except the voluntary drones, who are very few, and those who are incapacitated through age or misfortune. Does any theorist dream, that it is possible to provide by law any means whereby those employed at wages in any art or business, shall have full employment, and prosperity, while those who employ them shall be sinking to insolvency] Their interests are all bound up together. When the products of an art are in brisk demand, the labor of all those employed in it is so also, and consequently their wages are kept up; and if the market for the products of any species of labor is slack, the demand for the labor is so too, and the tendency of wages downward.

Therefore, those who say that protection promotes the activity and prosperity of those concerned in carrying on the arts, directly admit the success and expediency of the protective system; and the contrary doctrine is, as if you were to exhort the crew to sink the 158

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PROPOSITION XLVIII. ship and themselves in it, because there was a prospect of a profitable voyage to the owners. We see by the operation of the dose of free trade administered to the country in 1846, what is its effect upon those concerned in the arts, either as undertakers or employed parties. Both suffer together; the former by the want of a market and by high interest, the latter, by the want of employment and downward tendency of wages. The lenders have been the only parties benefited; and we ought to be glad that anybody has been so; they ought to have their turn; and we have the universal remedy of free trade to console us, namely, that the evil will cure itself; that is, activity will again be revived in those arts that were struck at, and interest thus again reduced to what it was in 1845, or those who have been hoping, finding it to be’I against all hope,” give up the struggle, and cease to demand loans. Adam Smith,* among his very many fallacies, considers interest and profits as always rising and sinking together, which is contradicted once in every revolution of the market, as everybody witnesses, for though when the markets are in the flood, operators may borrow, because profits exceed the rate of interest, yet when the markets are on the ebb, they borrow for precisely the opposite motive, namely, to hold on to their products in expectation of a more favorable market, and by so doing, avoid a loss by a sale at a low price. High interest is thus alternately paid in every revolution of the market, at one time to gain a greater profit, at another to avoid a greater loss. Now, the tendency of free trade, as already shown, is, to stop many kinds of production and check all others. Its professed object and undoubted effect, is, to take away * Book 1, ch. 8, p. 120. 159

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PROPOSITION XLIX. the domestic market from the domestic producer, whether employer or employed, and thus cut off the profits of one, and consequently the wages of the other. Its certain,operation accordingly is, to enhance the rate of interest by distress, and thus promote the wealth of lenders at the expense of the borrowers and the poor. XLIX. Protection reduces the money price of the great mnass of the most important productions of the useful arts - Free trade assumes that it invariably enhances the money price at a rate equal to that of the duty. One of the current fallacies in economical speculations, is, to assume -as universally true, what is so only under particular circumstances, and subject to certain conditions. It is a fallacy that runs through all Malthuis’s science, as he deemed it to be, of the tendency to the geometrical increase ,of the human species,* and infects all the treatises of the freetrade sbchool. It is evident that a duty on import tends to enhance the present price of an article to the consumer; tends I say; but to what -degree it will have that effect, and whether it will have such effect at all, will depend upon the adaptedness of materials and arts, and the vivacity of the domestic compe”fition, for producing the same thing.

Free trade here puts in the objection, that if it has not ‘the effect of enhancing the price, it has no effect, and, therefore, there is no occasion to impose the duty for proteetion. This objection has been answered under other heads, where it is shown that, in such case, the country is * See the dissection of this fallacy, Westminster and Foreign Review, for July, 1848. 160

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PROPOSITION XLI,IX. not sure to retain the production without protection, and that, if the cost of the foreign and domestic article is precisely the same to the consumer, then it is greatly for the advantage of the country to produce it at home, since industry, employment, improvement in our own arts, that is, the advancement in civilization, and the augmentation of our productive capacity, are involved; and these are among the leading objects of political association and legislation. So, where the price of an article is enhanced to the consumer temporarily, by reason of the arts concerned in the production of it not being yet perfected, or the domestic competition not being yet sufficiently strenuous, the temporary enhancement is compensated a hundred-fold by domesticating the production.

So, if the article is one of indispensable necessity, and the being deprived of it by a state of war, by the interruption of foreign intercourse, by Berlin and Milan decrees, orders in council, or by reason of the inadequate demand for our own products in foreign markets to purchase it abroad, would bring down sudden misery and starvation upon the great mass of the people, it may be surpassingly expedient to secure, within ourselves, the means of producing it for ourselves, though it’

should, in fact, be at a permanently enhanced cost to the consumer. So also, if the article be essential to national defence so also, if the domestic production of the article be materially auxiliary to improvements in the arts, or the sciences, or to education, or to the means of moral culture; or to recreation, or to melioration of manners, in the community generally. These are all sufficient and conclusive reasons for encouraging the domestic productions to which the country is adapted, in due time, and by due degrees. These topics are noticed under other heads, and my reason for mentioning 14* 161

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PROPOSITION XLIX. them here incidentally is, lest some reader should not start fairly and understandingly with me, in what I propose to say under the present head. To resume the subject, then, a duty on the import tends to enhance the present cost of the article to the consumer, and may have this effect permanently, or, on the contrary, it may have the certain effect eventually, and after no long time, to reduce the cost to the consumer, besides producing the other still more important advantageous consequences on the general welfare just mentioned. This latter effect will, I persuade myself, appear so plainly, that you will feel uneasy in not admitting it, however much you may be saturated with freetrade prejudices and fallacies. But why do I put particular stress upon this fact, if fact it be? First, because it is important; second, because, though no attempt is made by free trade to show the contrary that I am aware of, yet the contrary is assumed and taken for granted in all the speculations of its school, and this assumptioa is the basis of very much of its vehement protestations and appeals in popular addresses and writings, and the one pivot upon which a great part of the abstract sophistry on that side turns. This is one of the postulates of that system, which, if you take away, the whole breaks down; for if you once admit that some art may be successfully introduced by protection, which could not be introduced otherwise, and its domestic products subsequently supplied to consumers cheaper in the money price,* so as more than to repay the supposed sacrificee made to introduce it, with compound interest at six per cent. per annum, which is the freetrade formula! for the calculation; then you have an exception to the dogma of free * Cheaper, is always the sole point in free trade. 162

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PROPOSITION XLIX. trade, and consequently the science is gone. For, in that case you are bound, by your own theory, to come over to the principle of protection, in respect to such branch of production. And you will readily find many branches that have, and many more that may, come within this category. You might open an account current with protection, in the mercantile style, to test the profit and loss, provided you would estimate and include all the items, present and future, on the credit side, if indeed some of them are not above all such estimate, and abide the result.

But at present we will adopt the freetrade formula, and make our estimate in the present cash balance, precisely as a purchaser and vender of an article does, and omit all incidental, indirect, collateral, future and consequential benefits, which are vastly more important than the present balance on the cash-book, and stick to this balance, according to the freetrade system of book-keeping in matters of legislation and national economy. Mr. Polk, in his last message to Congress, spoke of agriculture on one side, and the mechanic arts on the other, as being antagonistic, and assumed the position that these can be protected only at the expense of agriculture, meaning that agriculture should be sustained, and these let drop by the reduction of the duty on imported products of the arts.

Ir. Walker, the Secretary, and all the rest of the chorus with him, re-echoed this passage, accompanied by the “organ,” and a full orchestra}

accompaniment of the freetrade press. This surely stops them from denying, what they and their sect have been expressly asserting for now these thirty years, that our present manufactures are of “hot-bed”

culture, or, in other words, have been created and are sustained by the duties on imports. The British manufacturers and their agents and representatives, in fabricating the tariff of 1846, also say the same t ing in etect, for they obligingly recom 163

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PROPOSITION XLIX. mend that we should reduce the import duty so as to enable foreign manufacturers to take abroad ten pounds sterling worth of the cotton, or wool, or wood, which we now manufacture in our own factories and workshops, and at domestic firesides, and send it back to us in a manufactured form at the price of fifty pounds sterling, for which it is proposed that we shall pay the balance of forty pounds in United States and other stocks; or in gold, if we can get this latter by digging in California. It may be that some of the same theorists say, that these same arts, which we now have, would have sprung up heretofore, or would spring up hereafter, spontaneously, without protection. But asserting a thing does not make it a fact. You might, with about as much reason, say, when a mountain has been tunnelled for a railroad or canal, that it was lost labor, for it would, if let alone, ere now, or hereafter, have removed itself out of the way suo proprio motu, at the bidding of some one having faith, which is a mental act largely reckoned upon by these same theorists. It appears, under another head, that this supposition of spontaneity is wholly inconsistent with experience in respect to arts and kinds of production which are common to all civilized nations. They do not grow wild any more than wheat and barley, but are the products only of protected cultivation. The partisans of firee trade surely, of all others, are least at liberty to put forth such a notion, until we can find some fiee-trade treatise, speech, or public address, that does not assume and assert as one of its commonplaces, that the domestic, mechanic, and chemical arts, the products of which are turned out in large masses and are of kinds of articles which are subject to a duty on importation, that gives to them adequate protection, are in an unnatural, forced, abnor 164

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PROPOSITION XLIX. mal condition. UJntil we can find some such omission, we are surely safe in discussions with persons who put forth such an opinion, in assuming that the establishment and maintenance of such domestic arts, are owing to protection, and of that very hot-bed production which they cry out against. Let us now examine into one of the palpable benefits already derived from the hot-bed. According to the treasury returns for 1847-8, our exports of manufactures, that is, the products of the arts other than those concerned in supplying raw materials, were sixteen and a half millions; five and a half millions of which consisted of manufactures of cotton. The proposition of free trade is, that we shall all turn graziers, and farmers, and fishermen, and instead of working up the raw materials into manufactures in the various arts, whether practised at the homes of the workmen, or in small shops, or large factories, should export them to European workshops, and take them back in a manufactured state, at four or five times the price we sell the raw material for, and find means to pay the balance as we can. This is literally the proposition of free trade. Those profound political economists stationed in the ports of principal importation, on salary, or on commission of a certain percentage, to publish superlatives respecting the goods of their European employers, and in praise of the tariff of 1846, fill the newspapers and periodicals devoted to their interest with exhortations and appeals, that call to mind the public ad, dresses in Germany, in Martin Luther’s time, by the venders of the Pope’s indulgences. They compute in figures, a saving of twenty or thirty millions a year, I forget how much exactly, to the country, by importing English, Scotch, and Swedish iron, and leaving idle the workmen, and deserted the works, employed previously in making those articles in New Jersey, Pennsylvania, and Maryland. These were the 165

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PROPOSITION XLIX. sage privy-counsellors of Mr. Walker, in projecting his tariff. Let us, then, consider this item of sixteen millions and a half of exports of American manufactures, which they propose to strike out of our commerce.* We shall find it a very instructive item, of more worth than all the abstract theories and syllogisms of free trade. Of this amount, you observe, five and a half millions consisted of cotton fabrics, which will be most convenient for illustrating our present proposition, because the data respecting this branch of the arts are nearer at hand, and more satisfactorily settled than in the others, and also because the particulars of the estimate in this, are stated in a note, under a subsequent head, by reference to which you will be able to correct my mistakes, if any, and substitute your own deductions for mine. In consequence of the duty on imported cotton fabrics, we have carried the manufacture to such a state of improvement, that we now export them to foreign countries, and sell them in foreign markets, in open competition with all the world, up to what is called number sixteen in fineness of thread. Now, unless we could, notwithstanding the high price of labor, and high rate of interest in this country, and all our other disadvantages, put this article aboard ship for export, at as low a cost in money as any other country can do so, we could not send it to the foreign market, for in that case, the exporter could not make any profit upon it, but would take his trouble for nothing, or actually incur loss by the operation.t *

I include manufactures of wood, these not being distinguishable in principle from the others put under the head of manufactured articles in the treasury reports of commerce, and many of them are the products of an advanced state of the arts concerned in their manufacture, the material being a slight proportion of the cost. Here the freetrade advocate will begin to say, “No duty on import is then 166

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PROPOSITION XLIX. Had we not by forcing in the hot-bed, established the manufacture of cottons, we must now have been supplied with them from abroad, upon the freetrade system of cheap purchases. But, we see that we must, in that case, now have paid as much in money for them in the foreign country, where we should have been obliged to buy them, as they now cost us in money at our own doors. I say at our own doors, for the manufacture of ordinary kinds of plain cotton, is, in consequence of the protection given to this business heretofore, now established in the interior, as well as on the seaboard, in all parts of the country; more than half in number of the factories being in the interior, so that most per.. sons, north and south, east and west, are supplied with substantial fabrics of this kind principally in use, by manufacturers not far distant from them, and at the same rate; that is, the article does not cost perceptibly more to a consumer in Ohio or Illinois, than to one near Boston, New York, or Philadelphia, or Baltimore. Many have it cheaper. Taking the whole country through, every consumer is supplied with this species of article in exchange for the products of his own land or labor, at the lowest price at which it is sold in the world. What then, is the average difference in the money price of an article in the home market, where it is made, and in a foreign country, three or four thousand miles from the place of manufacture? There is some difference. It consists of freight, commissions, insurance, and interest, besides profits to the importer. I put these, at the lowest, at twelve and a half per cent. But estimate them in your own way, and make your deductions accordingly; you will probably put them at fifteen per cent. at least. necessary.” On the contrary, it is essentially necessary, as has fully appeared in another place. 67

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PROPOSITION XLIX. You will find, under a subsequent head, the amount of domestic cotton fabrics consumed in the country, to be estimated at about fifty-five millions of dollars, to which add the five and a half millions exported, and you have a domestic manufacture amounting to sixty and a half millions annually. This is the amount of this particular article, that the advocates of free trade say we never ought to have produced for ourselves, and that we have lost so many millions with compound interest, by producing for ourselves; and which, if foreign manufacturers can, by dint of low wages of their labor, low interest of capital, or immense accumulation of capital, and gloss in finishing, and noise in hawking, drive from our own and our foreign market, it will be highly advantageous to this country to take this whole additional sixty and a half millions of imports from abroad, and pay for it at a great bargain in nobody knows what. This is the practical, preposterous result of a logical process, of what its learned professors are pleased to denominate a science; and what seems to them conclusive in its favor, is, (as they gravely assert by way of putting an end to all doubt,) that if it be not so, then-” Political economy is’ no science.’” What a sore calamity it would be to the civilized world, to be bereaved of such a science, and have it taught no longer in our universities, and colleges, and high-schools! There are eleven millions more of exports of manufactures in the same returns.* This amount includes divers kinds of articles of which we make for our own consumption a much greater quantity in proportion to the export, than we do of cotton-cloths. With many of them we supply our own consumption entirely. Our artisans have an “odious monopoly” of the supply. Let the average ratio be the same. This would give of the other articles, hats, furniture, ear * Supra, p. 165. 168

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PROPOSITION XLIX. riages, etc., of such kinds as we export more or less of to foreign countries, one hundred and thirtytwo millions of our own manufactures consumed in the country annually, besides the eleven millions exported, as you will readily see by making the figures. But as the ratio of domestic consumption to export is much greater, on an average, in these articles than in cottons, the amount of our consumption of such domestic products must far exceed one hundred and thirtytwo millions. It must be double, treble, or more. How much of this amount do the adepts in the science of the causes of national wealth, of the Adam Smith school, propose to annihilate, for the purpose of augmenting the wealth of the United States? If you wish to be satisfied with my estimate of it, I will refer you to Mr. Secretary Walker’s reports on commerce, manufactures, and the tariff, and to the speeches and addresses of his collaborators in the same field. From the augmented revenue anticipated by them to accrue from low duties, and from the golden Pelions upon Ossas of national wealth piled up to the heavens by the same giants of political economy, out of the savings to be made by means of the importation of cheap products of the arts, I conclude that they estimate an amount of at least five or six hundred millions of the present annual products of our own arts, to be destroyed and supplanted. Let us, however, take the amount only at the above estimated proportion of one hundred and thirtytwo millions, making, together with the proposed cheap imports of cottons, the small total of two hundred and nine and three quarters millions of dollars of imports, at the very lowest estimate, promised to us by free trade. It seems to promise vastly more, but this amount, in addition to our present imports of one hundred and fifty-five millions, is a staggering burthen enough f or the “science” to carry to market. The vast ad 15 169

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PROPOSITION XLIX. ditional amount of agricultural products which its professors seem to calculate upon exporting, may be left out of the question until the foreign demand shall be augmented by means of the annexation of another planet. Now then for the result of this tremendous commercial operation, scientifically promised by free trade. The proposition that we are now considering, is, that a duty on the import of an article may have the effect to supply the same from domestic production, at a cheaper money price to the consumer, than he could have it at by importation, sup posing custom-houses were abolished, and the world, from one polar circle to the other, were the one commercial fraternity which the freetrade thinkers imagine in their daydreams. In the case supposed, the products of the mechanic arts, of the kinds such as we now export, would come to us from abroad, excepting the coarsest, and those for which we have an advantage in the low cost of materials, or expense of transportation, amounting to from twenty to forty per cent., to countervail the low wages, low interest, greater experience and slkill, and other advantages possessed by our European competitors. In the commercial millennium supposed by free trade, the Europeans would keep and perpetuate all the advantages they have, and make them greater every year.

This is not deprecated by free trade; on the contrary, it is one of the effects desired by its professors. They directly and expressly promise, as a great boon to be bestowed upon us by their science, that, when the “expected morn” shall have arisen, we shall be, thereafter, beatified with these additional cheap imports, to replace the two hundred and nine millions we now have from our own domestic production, at a less cost to the consumer, reckoned in money merely, by fourteen millions and a half of 170

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PROPOSITION XLIX., dollars, than they would be supplied to us for from abroad, under free trade. You already see for yourself how this appears.

We sell in the foreign markets some of these same manufactures, amounting, as you recollect, to sixteen and a half millicns. Now we know, as already suggested, that no merchant exports goods to any considerable amount, except for a profit. The freight, insurance, interest, and a reasonable profit, will amount, as already estimated, to twelve and a half per cent.

The goods will not be exported by the merchant, therefore, from the United States to a foreign country, or imported hither from abroad, unless they net, at the port of delivery, twelve and a half per cent. over their cost at the port of shipment. You would, therefore, at first suppose that we are supplied with this whole amount of two hundred and nine millions of products of domestic arts, at a less cost in money to the consumer by twelve and a half per cent., than they would be supplied to him for from abroad, free of duty, making an annual saving of over twentyfive millions of dollars to the country. We certainly could not have begun the manufacture of cotton without the hot-bed, which was prepared expressly for this product by the joint work of both northern and southern legislators - most by southern - in Congress, on the suggestion of the late Mr. Francis C. Lowell, in 1816. The duty on many other articles of the kinds exported, that are included in the remaining eleven millions of exported manufactures, besides cottons, was a like hot-bed to start them, and in many of them, such as articles of leather, and iron, furniture, carriages, hats, paper, the amount of domestic consumption compared to that of the export, is ten-fold, to twenty or thirty-fold, what it is in domestic cotton goods. But take it to be on an average only the same, t7l

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PROPOSITION XLIX. and instead of estimating the saving in the money price to the domestic consumer on the whole two hundred and nine millions, estimate it on the same proportion as hereafter in a subsequent note, in the article of cottons, namely, on one hundred and seventeen millions.

Though the amount on which the estimate should be made, is vastly greater, we will put it at that, or, if you please, at any less amount. Our people then have, say one hundred and seventeen millions of domestic products of the mechanic and chemical -arts, which have been protected, and fostered, and started :in the hot-bed, which would otherwise have been nipped and ‘blasted by foreign competition; and which now come to the American consumers as cheaply, at least, as to any con,sumers in the world, and twelve and a half per cent. cheaper than they could have been imported under free trade. Here :is a reduction of the cost to our domestic consumers on these articles in the money price, amounting to fourteen and a half mniillions; thanks to the hot-bed. I would not be understood to imply that the annual econ~omy from this cause to consumers, in present direct expenditure, independently of all collateral and consequential advantages, is not vastly greater, than that amount, but I am coming within the limits to which you cannot but assent, and if the above are too large, reduce them. Unless you are entrenched behind some prejudice, or interest, or pride ‘of opinion, or esprit du corps, that is reason-proof, you will find not a few, and not a small amount, of the products of ‘the principal domestic arts supplied to the domestic consumers, through the operation of protection, at a less money price than they would have been, had the custom-houses been shut up in 1789, and so continued to the present time. And if you make such a discovery, you will assent to my proposition, that, “Protection reduces the money price of a 172

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PROPOSITION L. great mass of the most important productions of the arts.”

And if you so assent, you must be a protectionist, at least to the extent of the saving on the present money price, for if the question is whether a certain duty is to be imposed or maintained on a certain article, you will, if your notion of economy, as a legislator, is like that of an individual in his own affairs, examine to ascertain whether the article in question is of the description on which a protective duty will result in a saving in the present cash account. The dogma of free trade will not exonerate you from the obligation to make this inquiry; for you have thus conclusively shut out let-alone. But I persuade myself that you will, on examining the subject, go further, and take into the account, the other collateral, incidental, indirect, and consequential advantages of promoting the arts, which are so vastly more important than a trifling enhancement or reduction of the present money price of an article; but you are bound, at any rate, to go as far as this will carry you. L.

D)iminishing the duty on imports does not necessarily diminish the price Free trade alleges that it dimin ishes the price in the ratio of the duty.

It follows from the preceding proposition, that diminishing the duty on the imported article does not necessarily, and in all eases, diminish the price to the consumer. If the duty were abolished to-day on all the manufactures of the kinds that we send to foreign markets and sell there against all competition, it might encourage foreign manufactures to make use of their larger capital and wider business to drive our domestic manufactures out of our own market and break them up; but the same goods would then come to our consumers at a higher price, as already shown. This might be 15* 173

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PROPOSITION LI. the result of the ordinary operations of trade without any specific design on the part of the foreign manufacturers, to crush our manufactures, as is shown under another head. Therefore, in this ease, taking off the duty entirely, would, in the event, instead of diminishing the cost of the article to the consumer, have the effect to enhance it, by, at least, twelve and a half per cent. LI. Reducing the duty below the point of adequate protec tion, on an article of which part of the domestic pro duction is exported, diminishes the gross amount of im ports and of revenue - Free trade pretends that it aug ments both. We have already seen, that is, if we see alike, that there may be such a thing as a balance of trade between two countries, or a general balance of all its foreign trade in favor of or against any one country, and if so, we have seen what the freetrade writer of 1821, before quoted, calls “a vision.”

There may not only be a balance of the whole trade of a country against it, to be paid in its circulating medium, or stocks, public or private; but also an outstanding indebtedness going on accumulating and weighing heavier and heavier upon it, and paralyzing its industry and its arts, and keeping its currency in a deranged state, for fifty years, as Adam Smith puts the period in the quotation before made from him,* and for one hundred and fifty, as was experienced in this country in the colonial and provincial times. In such case, the country may, by reason of the failure of its merchants, or by that of its banks and other corporations, the stocks of which have been remitted in payment * Supra, p. 98. 174

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PROPOSITION LI. for imports, or by repudiation where the public stocks have been so remitted, obtain for itself imports, which it never pays for.

This is a source of gain, on which, I presume, no person, whether on the side of protection or free trade, will calculate as part of his system for economical growth and social progress, any more than he would upon piracy.

Excepting such gain, if such it can be called, which always, like other errors, brings with itself distressing retributions, all the imports into a country must be paid for by its exports and its earnings by navigation.

The income to a country from navigation, will usually depend materially upon its exports, at least ours does so, for our outward freights, taken altogether, are much greater than the homeward; and we now carry between foreign ports very little, as I understand, except in connection with the transportation of our own exports. In other words, our ships go from our own ports, and after a circuit of two, three, or more passages, return home. They do not generally remain abroad, as the Norwegians, Danes, and Dutch seem sometimes to have done, to carry on navigation between third countries, though they do considerable transportation between foreign ports in connection with the transportation of our own exports and imports. We ought to keep one half, at least, of the carrying between the United States and foreign countries, though we may easily lose this and our coasting trade besides, by being over-reached in commercial conventions, a sort of game to which we seem, at present, to be able to bring quite as much confidence as skill; and to be in danger of seizing for prey, what will prove to be bait. But we will suppose that we keep our just proportion of our foreign, and all of our coasting, trade. The income, or profits, or earnings, whichever you may prefer to call it, of 175

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PROPOSITION LI. our foreign navigation, may be assumed to be governed by the amount of our imports and exports, and to increase and decrease proportionally with them. We may accordingly omit the separate consideration of freight, and, for our present purpose, regard it as included in the value of our exports; as it, in fact, practically is, for it constitutes a part of their value in the foreign markets, where they are disposed of. Excluding, then, acquisitions of imports by means of insolvency and repudiation, and considering the freights of our navigation to be included in the value of our exports, our imports cannot exceed the value of our exports, which foreign countries will buy of us and pay for at a price in money, some twelve and a half to twenty, twentyfive, or thirty per cent. higher than our market price.* Is, then, the quantity these foreign countries will take of our exports, and pay such prices for, unlimited? Is it infinite? Free trade says it is. This assumption has been examined already under a previous head, to which I here refer; and if you shall, notwithstanding, still have faith in the infinitude of such foreign market, sufficient for all our exports, actual and possible, at such a price, leaving still an immeasurable chasm, that cannot be filled, according to the fundamental incredible dogma of the free4-trade science, then I have no premises with which you can proceed with me under the present head. But if you suppose that we now, pretty fully supply, and do, in fact, often glut, the foreign markets with most kinds of our exports, and have no small surplus left over for the next year, unless they are too perishable to survive; then I can take you with me, in the little remaining to be said upon the present proposition. * The freights of lumber and other articles of small value in comparison to their bulk, are subject, of course, to a freight that is very high in proportion to their value. 176

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PROPOSITION LI. I say, then, that we now in general fully fill, and sometimes overcharge, the foreign markets with the articles that it is possible to export, and that we have no means of paying for imports but by exports. It follows, consequently, that whatever diminishes the value of our exports, has the inevitable effect to diminish our imports. If this is the necessary effect of the free trade proposed by our doctors of that science, then we may apply to their prescriptions what Macbeth said of physic, to his doctor. We now export sixteen and a half millions of manufactures. They propose to substitute agricultural productions for a great part, at least, of these manufactures, and to depend on the export of provisions and raw materials. We now fill the markets with these, and should we cease to export the sixteen and a half millions of manufactures, as proposed, we should thereby diminish the value that we now put into the foreign markets, by some ten millions, more or less. The computation is thus: - Let the raw materials for these sixteen and a half millions of exports be six and a half millions. Admitting that we could find a foreign market for these additional six and a half millions, which is admitting a gross improbability, still, at this best result that we can thus make to help free trade, it leaves us a deficit of ten millions in the value of our exports in the foreign markets to buy imports with. This effect of free trade, desired by its advocates, would diminish our imports ten millions of dollars, estimated at the foreign market price. Consequently we have so much less of imports to raise revenue upon, so that the revenue would, at any given rate of duty, be less, and be subject to still greater diminution by the reduction of the rate of duty. Vary the estimate if you choose, still the result will, in spite of your prejudices and biases, if such you have, come out on the same side, if not in the same amount. 177

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PROPOSITION LII. Therefore, in such case, (and the case comprehends a vast proportion of our industrial system,) I think we may say without qualification, that reducing the duty below the point of adequate protection, has the certain effect of reducing the amount of imports, and that of the revenue. The effect may be modified, temporarily, by a foreign famine, or a disturbance of foreign industry by war, or some other calamity, giving us relief through the distress of other countries; or by the excessive export of the precious metals, which brings present distress to ourselves; or the effect may be postponed by remitting public stocks, and running up an immense foreign credit, which is merely putting off the evil day, and meanwhile aggravating the evil, as we have been doing for three years past. Such intervening circumstances may afford plausible opportunity for fallacies and unsubstantial pretences in behalf of free trade, apologizing for it, and giving it the credit due to a war, or famine, etc., and for otherwise “clouding high matter with dark words;” *
but that such in general, on the whole, is the certain effect, I venture to say, beyond any reasonable doubt. LII. In stating the account with protection, it is to be cr-ed ited with what it saves to the country; the balance is in its favor, even by the erroneous freetrade rule for stating the account-It is incalculably more so in a true state ment of it. My object being to present the outlines of free trade and protection, in a condensed and plain form, and to bring them within the reach of every reader, whether man of business or leisure, I often omit what has been said on different top * Athenae Oxonienses. Vita Rob. Fludd, a Rosacrucian, Anno, 1637. 178

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PROPOSITION LII. ics, and not unfrequently considerations that occur to me which I do not recollect to have met with; and on the present subject of unproductive taxation, by duties-for that is, as you see, really the subject-I feel obliged to confine myself to a very concise abridgement which I am the more ready to do, as it has been elaborately presented in, perhaps, all its phases, in all degrees of exaggeration and extenuation, and is in short so stale and used up, that I ought to express my acknowledgements to you for reading thus far; and I make this preliminary apology by way of saying to you at the beginning, what Diogenes said to his impatient fellow sufferers, on catching a glimpse of the end of a tiresome discourse, ” Cheer up, my friends, we begin to see land.” The question here, is, under what circumstances, and in what degree, a duty operates as a tax, without yielding a proportional revenue. The advocates of free trade object, that a duty on articles, such as are produced in the country, whether in agriculture or by other arts, enhances the price to the consumer, not only of what is imported, but of the whole domestic production of the same species of article, by an amount equal to, or rather exceeding, the duty-exceeding, because the importer will charge interest and profits on the amount which he advances for the duty. This is one of the propositions, which, being true under certain conditions to a limited extent, the scientific economists assume to be universally true, like a geometrical theorem; and having thus converted it into a fallacy, proceed to work out demonstrations with it. Mr. Secretary Walker made up a great part of some of his reports with this same fallacy. It is quite a transparent fallacy, as you will readily perceive, if you have not already done so. According to the estimate of the commissioner of patents, the crop of wheat in the country, in 1848, at a dollar and 179

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PROPOSITION LIIl fifteen cents per bushel, amounted to one hundred and fortyfive millions; and of wheat, Indian corn, barley, rye, oats, beans and peas, to six hundred and seven millions; the duty on these imports being twenty per cent. The potatoe crop was supposed to be thirtytwo millions, the duty being thirty per cent. If, therefore, we suppose the duty to have been paid on a valuation of half of the above amounts, we sustained, according to the infallible “science” of free trade, (as expounded by Mr. Walker, who speaks in the esoteric style of the sect which Great Britain advises this country to join,) a gratuitous dead sacrifice in that year, of fourteen millions, by raising our own wheat instead of importing it, and sixty millions by raising that and the other articles, just named with it, and subject to the same duty, instead of importing them all, and nearly five millions more by raising our own potatoes. According to that science, we should have saved during that one year, by importing all those articles from abroad, sixty-five and a half millions of dollars, and if we had pursued the same policy the previous year, we should have thus saved twice that amount; enough to have paid our debt for the war with Mexico, and the purchase of California and New Mexico, and had a large surplus in the treasury. Such are the prodigies that we are told would have come of the “wonder-working” of the let-alone.

If you doubt whether I am giving a genuine specimen of the logical deductions of the economical science of Adam Smith, and Mr. Walker, and the agents of foreign manufacturers in our sea-ports, it is because you have not read the seeretary’s report, and the treatises of freetrade economists, and the profound articles on this subject in the freetrade periodicals; and I accordingly have the honor of initiating you into that transcendent science. The freetraders in Great Britain illustrate their doctrines iso

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PROPOSITION LII. out of agriculture, those of the United States out of other arts, the case being precisely reversed in the two countries, but the theory is equally applicable in either case. Apply it then in domestic manufactures, as Mr. Walker did in his report, the estimate of which in the United States for the same year, by the Commissioner of Patents, was $550,000,000. This comprises all the manufactures, those subject to duties on imports, as well as those that are free, and we will assume the proportion of free articles of manufacture to be the same as that of the imports generally, namely one seventh. This will give us $470,000,000 of domestic products of the arts, such as are subject to a duty on importation. This duty is, on an average, somewhere about twenty per cent.

We will assume that-they pay duty on importation at seventy per cent. of their value as estimated in the report of the Commissioner of Patents. Our gratuitous dead loss then, according to free trade, by making our own clothes, hats, shoes, furniture, and divers other products of our domestic arts, instead of purchasing them all at imagined great bargains from foreign manufacturers, with imaginary means to pay for them, was, in the same year, 1848, $66,000,000; very near the amount we sacrificed, according to the same veritable science, by raising our own wheat, corn, potatoes, etc., instead of importing them. This is somewhat staggering to men of little faith, and not yet thoroughly indoctrinated in the mysteries of the science, but one who has attained to the degree of doctor in it, will follow the example of Dr. M’Culloch, when interrogated by a committee of parliament respecting the effects of absenteeism on Ireland. He did not boggle in the least at the dilemma, but answered straight, as he was bound to do by 16 181

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PROPOSITION LII. the “science” of which he is one of the luminaries, that it was not in the least prejudicial. He says the same in his published treatises. You are bound to have an unqualified faith in the above results, and others no less marvellous, under the penalty of being written down with Dogberry by the professors of that sort of political economy, which is now daily taught in our colleges and public schools. For myself, I plead guilty. I make confession that I have not the least faith in those marvellous deductions of freetrade dialectics. I have already given some reasons for this lack of faith under preceding heads, where it is proved, unless the premises are disputed, that all domestic products whatsoever, whether of mechanic arts or agriculture, that we sell in foreign markets upon a footing of equal competition with all other producers, are supplied by our own industry to our own consumers, not merely at as low, but at a lower present money price by one eighth, than they could obtain them by importation, even if we could produce or procure anything exportable to pay for them, which we evidently could not do; and also that the advantage thus derived from domestic products of the arts to our own consumers in the interior, is vastly greater in proportion than that derived to consumfers residing near the points of foreign importation. Those employed to drum up orders to foreign manufacturers, and here and there a paid editor, will no doubt continue to utter and publish that the prices of our domestic products are invariably enhanced to the consumers, by an amount at least equal to that of the duty on like imported articles, and more enhanced to those consumers living in the interior, that is to the farmers and planters, than to people on the coast and at the commercial centres,-
but with how much reason, I leave to your decision. Dismissing, then, that proportion of the consumption of lS2

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PROPOSITION LII. domestic products in the country, (comprehending, as you have seen, very nearly the whole amount of our consumption,) on which there is not only no ground, or pretenee of ground for alleging a tax without revenue, but which, on the contrary, has been proved to come to the consumer at a much less present money price than articles of like quality would be supplied to him through importation, free of duty, if they could be so obtained and paid for, which they could not be; we now come to kinds and qualities of products of our domestic arts, such as are consumed in the country without the exportation of any of the like kind or quality in any appreciable quantity. These are the only products of our arts concerning which there can be any question about taxation beyond the amount of revenue thereby produced. One object of levying a duty is revenue, and where the article is not produced in the country at all, as spices, sundry wines, spirits, fruits, etc., with various refined manufactures above the reach of our arts at present, or to which our locality, climate, and raw products, or the habits and character of our people are not adapted, the duty has no effect, and is not intended to have any on the domestic production. These articles afford ample subjects for raising revenue by import, without including tea, coffee, medical drugs, raw materials for manufacture, and other articles which, in ordinary times, would naturally be admitted free. Between such articles on one hand, such as we do not produce for ourselves, and those on the other which we produce and send to foreign markets, in case of their being of a kind admitting of exportation, lies all the debatable ground respecting taxation by import, over and above the amount of revenue thereby yielded.

This discussion concerning high tariff and low tariff, in reference to the productiveness of the duties, is confined within these limits. lS3

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PROPOSITION LII. IHere you will notice in passing that the number and proportional quantity of our domestic products to which this supposed objection of taxation without revenue, can be pretended to be applicable, are constantly diminishing, and the number and comparative quantity of those supplied by our domestic arts to our own consumers cheaper in money price than they could be imported duty-free, are pretty steadily increasing. It is now only about twentyfive years, since higher and more complicated mechanical and chemical useful arts, began to take firm root in the country, and but fifteen or twenty years since their products have been subjects of export in any appreciable quantity. These arts have been twice arrested by legislation, and some of them brought to a stand, during the twentyfive years. Yet they have, on the whole, kept on the advance; so, as at first, to supply the coarser and ruder products, then those of a superior description; whether at a cheaper or a dearer rate than they could have been obtained by importation is of small consideration, since nobody, not even the wildest theoretical dreamer, has dreamed of any specific possible way of getting the means of being supplied to the same extent with the same articles, except by our own domestic arts. We find that for some twenty years, we have exported sundry products of our arts in competition with foreign producers, thereby proving that our own consumers were supplied by our own arts with a vast amount of such articles, cheaper in the money price, than they possibly could have been supplied with them free of duty. Since the proportional quantity has been constantly increasing, and we have no reason to doubt, that, under a protective legislation, it will continue to increase, it follows that the proportion about 184

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PROPOSITION LII. which there can be any pretence of unproductive taxation, is diminishing, and will continue to diminish, in an equivalent ratio.

Before proceeding to the class of domestic products of which we do not export any appreciable quantity, let us glance at some of the articles belonging to that division; and see if we do not find some, of which there can be no question of the expediency of the domestic production, though at an expense enhanced above that of importation, supposing the obtaining of a foreign supply of them to be practicable. The two that most obviously present themselves, are iron and wool, and fabrics consisting wholly or mainly of either, which enter so largely into our consumption; as also into that of every civilized country. It is not easy to say which of the two is the more important. The production and use of both are greatly auxiliary to the different branches of industry, iron more so to the mechanic arts, wool more directly so to the occupation and improvement of land, of which the country fortunately has an immense surplus. This surplus is of some advantage even if we propose, in pursuance of the recommendation of Mr. Secretary Walker and the representatives of European manufacturers, to relapse into the semi-civilized condition of husbandmen and graziers, with ancillary rude arts up to Lord Chatham’s mark of the “hobnail;” but it is of immensely more importance, if we continue to avail ourselves of this vast territory to promote our useful arts, by furnishing to them a market expanding itself indefinitely, commensurately with their growth, and thus, at the same time, supplying an ever-increasing market for agricultural products. Those two species of materials, as also leather and cotton, come into the category of articles, to the production of 16*

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PROPOSITION LII. which the country is adapted, and with which it is essential to our national wellbeing that we should be able to supply ourselves from our internal resources. They are no less important to us as means of defensive war, than forts, and military and naval preparations. “

But,” says the Edinburgh political economy, “the normal state is that of peace.” Granted, if you please, for the present purpose; it is very certain that the surest way for a nation to keep itself in that normal state, is to be prepared for the abnormal one of war. All that can be said upon this topic is familiar to everybody, and needs not to be dwelt upon.

What seems remarkable, this is one of those considerations that freetrade philosophy never dreams of, though it really comes into the question of cheap and dear - high and low price; but it is not confined to the market money price to-day, and so is beyond the horizon of that “science.” I repeat, in this connection, that if we include a tenth part of the incidental advantages, and make out the cash account for a course of years to come, in all the vicissitudes of foreign trade, in belligerent as well as peaceful periods, the cheapest-incomparably cheapest-supply of the above named articles of iron, wool, leather, cotton, and others to the production of which the country is adapted, and standing in the same relation to our industry and wants, is from our own domestic resources, even admitting the inadmissible possibility of getting means to pay for a foreign supply of them. But I maintain that the interest of the country requires the domestic supply of these articles at whatever present or permanent enhancement of the money price to the consumer: on the ground that the other considerations far outweigh any difference there possibly can be in the money price; and, if so, the question between protection and free trade is settled. IS6

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PROPOSITION LII. It is also settled by another consideration relative to these same articles, for, as already suggested, nobody dreams of any possible way of obtaining them otherwise than by domestic production, and nobody will deny that they are indispensably necessary, not merely to our advancement, but also to the keeping of our present position, in industry, arts, and civilization. No one, but the veriest transcendental fanatic in free trade, will pretend that the production of these articles, will be less economically and vigorously conducted and brought to perfection, under steady and adequate protection, than without protection. In either state of the case, therefore, the palpably true and safe course is protection. Perhaps you will not be ready to believe that the freetrade policy involves the suppression of the branches of industry in question.

The journals of that school not long since, congratulated the country on the saving of twentyfive millions of dollars-I think it was that amount -
during the year 1849, by the importation of foreign iron, under the tariff of 1846, and the consequent ruin of many of our own iron establishments, which is in reality to congratulate the country upon the fact that thousands of laborers had been thrown out of employment. Such was the desired and intended effect of the reduction of the duty. Mr. Walker, in his memorable report of 1848, asks, “When will they,” that is, the manufactures, “cease to be infant?” implying that they never will cease to be so. The whole drift of his argument, and that of his school, in regard to what they deem the “sickly” offspring of protection, is in favor of adopting the Chinese common-law custom of infanticide. I may surely presume that the people of this country estimate civilized existence and progress to be of more worth than cheap purchases abroad, of bar-iron, copper, lead, hats, boots, wool and ordinary woolen cloths, hemp, etc., etc. lS7

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PROPOSITION LIT. Admitting that such purchases could be made, most egregiously cheap in the money price at the time, it should surely be but a very inconsiderable circumstance, in determining the industrial policy, and the civil and political destiny, of the country. The saving of a penny in the yard or pound certainly weighs very light against such considerations. With these reservations, let us proceed in the inquiry into the real extent of the saving and loss by protection, reckoned in the present money price according to the freetrade way. We shall, I am confident, be able to dispel some of those frightful illusions that have been conjured up on this subject. When you come near to “the demi-gorgons and chimeras dire” of home industry, you will find that they “mock the sense.” In the example we have taken to illustrate the operation of protection generally, when applied to products to which the country is adapted, I estimate that there is an annual credit of near five millions to be given to the protection of our domestic arts, in the manufacture of cotton fabrics, of number sixteen and under, by reason of a saving of at least twelve and a half per cent. on the money price of such articles consumed in the country. The data for this estimate are given in a subsequent note. We next come to the division beginning firom number sixteen in fineness, where we suppose export to cease. It does not cease precisely at that point, for it is said that we send abroad some fabrics up to number thirty or thirty-one, and may perhaps import some as low as sixteen; but, at present, I understand the export substantially ceases at the latter number. Our own consumption is supplied substantially, though not exclusively, by our own domestic arts, up to number forty inclusive.

Though we make some articles iss

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PROPOSITION LII. of a higher thread, yet, as I am informed, the foreign article prevails above that number. This division of numbers, sixteen to forty, includes, according to the best estimates I can get, twelve fiftieths of our whole consumption of domestics; that is, in round numbers, about thirteen out of fifty-four millions. Now, as numbers sixteen and under are supplied to our consumers by domestic arts cheaper in the present money price by one eighth than they could be by importation free of duty, if the duty gives an advantage to domestic production over imports equal to the amount actually paid, the domestic arts will be able to supply the home consumption in preference to the foreign, up to the point at which the foreign manufacturer, by reason of cheapness of labor abroad, superior arts and other advantages, can stand the competition in our market with our domestic producers, notwithstanding the duty; that is to say, until we arrive at the point where his advantages of one kind or another are equivalent to the duty. This point we put above number forty.

In order to know how much the consumer is benefited or taxed according to free trade, we must see what the duty really paid amounts to. Before making that estimate, I will ask your consent to a short digression, relative to a collateral consideration of some importance, here presenting itself. In one of the most able and instructive treatises ever published on political economy,* it is sagaciously and philosophically suggested, that many objects of vanity, taste, and * New Principles of Political Economy5 by John Rae. Boston, 1834. This treatise was written in Scotland, and intended for publication in Great Britain, but the author having changed his residence to Canada, found it more convenient to publish in the United States. Mr. Mill praises the work, instead of answering its arguments. 189

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PROPOSITION LII. luxury, are esteemed by some consumers, not so much for their utility, excellence, or beauty, as their costliness. lHe instances the solution of pearls drunk by Cleopatra, and occasionally by some wealthy Romans, not for the flavor or virtues of the potion, but merely from motives of distinction; since but very few of the most wealthy persons could indulge in this princely folly. We have a modern illustration of the influence of the same motive, that comes nearer to our subject. Under Napoleon’s continental system, the price of smuggled cotton stockings was exceedingly enhanced in Paris, whereupon the more wealthy and fashionable Parisians forthwith appeared in cotton stockings, while persons of moderate fortunes were so unhappy as to be able to wear nothing better than silk. Whatever may be the cause of the enhancement, whether the cost of production, rarity, danger of smuggling, or a duty on the import, still the desirableness of the article from this motive, is increased in proportion to its expensiveness. So far, therefore, as this motive has influence, the duty is no tax, for the consumer obtains what he seeks in his purchase, and is willing to pay for, namely, distinction; the gratification of his vanity; and the law imposing the duty effects what freetraders say it never can do, for it gives an additional (not merely cost, but) real value to the article, and thus “creates” the very “capital” that pays the tax. You observe that we are now approaching the region where this motive begins to operate, in cottons, and in the thousands of other articles of consumption, which I am here taking cotton fabrics to represent. It is a consideration not to be overlooked in legislation, or in speculations upon economical phenomena. In divers things coming from England and France, the value to the consumer, and his motive to purchase, depend on the distinction on account of their ex 190

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PROPOSITION LII. pensiveness, rather than beauty, utility, or excellence in the articles themselves, and so far as a duty serves to indulge this motive, it is no tax, either by the rules of free trade, or any other way of making an estimate. But we will wholly omit this consideration in our present estimate. We must, as a preliminary step in the application of the freetrade rule of the present money price, in order to determine the balance of gain and loss in the article in question, and other articles corresponding to the different qualities of this one, ascertain what rate per cent. is actually paid under an ad valorem duty of twenty-four and a half per cent. on its value in the foreign market.* Unfortunately, the twenty-four and a half per cent., is, in fact, not realized on goods sent to the United States by our resident foreign instructors in political economy. They are not like Mr. Mill, Mr. M’Cullocb, Mr. Senior, and others after Adam Smnith’s example, mere theoretical freetraders. They are practical men, who make as near an approximation to actual free trade as possible, not only in advising our Secretary of the Treasury and committees of Congress, when consulted about the proper tariff to be adopted by this country, but also in invoicing their own goods, and entering them at our custom-houses for payment of duties. They put the value of them very low. We have their oaths to the fact that they are for free trade. Accordingly, the method adopted by some American importers, in order to do business to advantage, is to purchase their goods delivered in the United States, thus including the entry and custom-house * The different rates on cotton fabrics are twenty, twentyfive, and thirty per cent. ad valorem; the average, taking into consideration the quantities of the different descriptions subject to the different rates, is estimated to be twenty four and a half per cent. 191

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PROPOSITION LII. oath in the bargain. Such round-about ways does free trade, with its ad valorem duty, drive our own merchants to, in order to retain a share in carrying on our own commerce. They are obliged to import the custom-house oath as well as the goods. I accordingly understand that from this, and other causes, a fair estimate of the duty actually paid upon these imports, as it has heretofore been levied under the tariff of 1846, is not over eighteen and three eighths per cent. In the division including numbers seventeen to forty, now in question, amounting, as estimated on the best data I can obtain, to more than thirteen millions of dollars, if we reckon by the freetrade rule of the present cash account, and grant to it all its postulates, there is an enhancement of the price to the consumer without revenue to the government, amounting to a little over two hundred and thirty-five thousand dollars. I refer to the subjoined note for the particulars of the computation.* The cotton fabrics of yarn above number forty in fineness, being estimated at one fiftieth part of the products of the cotton manufacture, amount annually at present, to nearly two millions of dollars. *Annual profit and loss account of domestic cotton fabr according to the freetrade theory, granting all that the the granted, and assuming nothing which it denies.

Annual returns of cotton used in the country, bales - - Add for what passes from the producer to the consumer in the in terior, and does not come into these returns, say bales - Bae, — _ ––– _ -8,0

Estimated at 450 lbs. to the bale, lbs. - - - 283,500,000 Allow for waste, as per returns of a mill for six months; thread waste 3 3-7 per cent., worth 3 cts. per lb., cotton being at 10 cts.; common waste 6 per cent., worth 2 1-4 cts. per lb., batting waste 1-7 per cent., at 4 1-2 cts. per lb.; picker waste 2 per cent., worth 1-7 ct. per lb.; in the whole about 12 per cent.: and allow that one third part of its weight re-appears in some manu factured form, leaving net waste, eight per cent., lbs. - -

22,680,000 Weight of manufactured cottons, lbs. - - 260,820,000 192 -

530,000 - 100,000 630,000 Bales,

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PROPOSITION LII. Let us estimate the tax to the consumer upon this amount, according to the freetrade method, granting all its extraor Brought forward, lbs., - - - - - - 260,820,000 Deduct exports, $5,700,000, estimated 3 square yards to the lb., at 7 1-2 cts. per square yard, lbs., - - - - - - 25,334,000 Leaving for domestic consumption, lbs. - -

235,486,000 Estimate 37-50 of this consumption to be cloth made of thread No. 16 and under, - - - - - lbs. 174,260,000 12-50 cottons of No. 17 to 40, inclusive, - - ” 56,516,000 1-50 cloth above No. 40, - - - — “

4,710,000 The value of these three divisions will be respectively as follows: 1st. 174,260,000 lbs. No. 16 and under, say 3 square yards to the lb., at 7 1-2 cts. per square yard, -.. - – $39,208,500 2d. 56,516,000
lbs. cloth No. 17 to 40 inclusive, including prints 4 1-2 square yards to the lb., at 5 1-4 cts. per square yard, - $13,352,000 3d. 4,710,000 lbs.

cloth over No. 40, 6 square yards to the lb., at 71-2 cts. per square yard, -. . - – $1,978,200 Whole amount, -… - –- $54,538,700 These estimates result from consultations with persons conversant in the business. Annual saving to the country, to be credited to the cotton manu facture, 12 1-2 per cent. on the first of the three above amounts, viz., $39,208,500, as already shown in the text, computed on the money price, merely, according to free trade, - - - $4,901,000 On the second amount of $13,352,000, Nos. 17 to 40 inclusive, if the net average duty were 12 1-2
per cent. on the value, there would be no tax without revenue, reckoning by the same freetrade rule, for we begin with a saving of that rate to the consumer at No. 17, and stop at No. 40, with a tax without revenue at the same rate, and the two would precisely balance each other. But the average rate of duty on the market value being estimated at 18 3-8 per cent., there is, by that rule of computing, a tax of 5 7-8 per cent. which begins to take effect when we have passed over just about twelve thirtieths of that amount from 17 upward. That is, it enhances eighteen thirtieths, viz., three fifths of that amount, but as it begins at zero and gradually enhances the price of this three fifths, until the enhancement amounts to 5 7-8, the average enhancement of this proportion, by the same rule, is 2 15-16 per cent. This rate on three-fifths of $13,352,000, viz.,on $8,011,200, is $235,329. On the third amount, viz., $1,978,200, of cloth over No. 40, we will adopt the same method of computing, that is, we will grant everything assumed by the theory of free trade, and admit that the tax paid by the consumers, which yields no revenue to the government, is equivalent to the realized rate of duty esti 17 193

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PROPOSITION LIL dinary assumptions. Suppose, if you can, that we could find a foreign market in terra incogntta, for a sufficient quantity of our exports of raw materials, to yield proceeds wherewithal to pay for additional imports of sixty millions’ worth of cottons, besides four hundred additional millions and over, of other foreign products, proposed by free trade to replace our other domestic manufactures; and also leave out of the account all the incidental, collateral, and consequential advantages accruing from the increase of domestic arts You can, in this freetrade way of computing, make the tax without revenue on home-made cottons, above number forty, but about three hundred and sixty-four thousand dollars. The result is, that you Ieave an annual balance in the present money price in favor of this branch of domestic arts, of over four millions, an absolute annual saving of that amount to the consumers of domestic cottons in the United States. I give in a note the premises from which this deduction is made. I intend, both here and elsewhere, to make plain every step of the process whereby I come to my conclusion. The steps must necessarily consist partly of estimates. These mated on the whole amount of the domestic consumption of domestic cottons. That rate I estimate on an average on imported cottons, allowing for cunningly contrived invoices, etc., to be 18 3-8 per cent. on the value, which on the above amount of $1,978,200, is $363,494. These two enhancements amount to -….. -$598,823. Deduct this last amount from the above credit of $4,901,000 due to this branch of industry, and you have the net annual saving to the domestic consumers of these products, compared to what they would, at least, cost in the cash price, imported wholly free of duty, viz: - - - $4,302,177. This estimate concedes to free trade all its postulates, aEd supposes what is incredible, that we could obtain elsewhere goods of equivalent character; and, what is impossible, that we could produce and find a foreign market for sixty millions’ worth of other products besides cotton-cloths, in addition to our present exports of such other products. 194

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PROPOSITION LIT. I give. If there is any inaccuracy in them, correct it.

You cannot find the error so great as to reverse the result. It can, at most, only modify its amount. But this is not the whole of our indebtedness, in ready money, annually, to this branch of domestic industry. The former duty on cotton imported into England, is said to have been equivalent to about five per cent., then reduced to about half of that rate, and finally, in 1846, taken off entirely. Under this duty we paid a tribute to the British government. Suppose the duty of five per cent. to be now levied at Liverpool, on our cotton sent thither, and our imports of cotton goods to be the same as in 1847-8, we should have paid, during that year, about one hundred and eighty thousand dollars to the revenue of the British government.* This duty has been abolished, partly at least, on account of our competition in the manufacture of cotton. How much is due to the French, and other European competition, it is not easy to say. This branch of manufacture is, therefore, to be credited on account of its having helped to relieve us from this tribute. The annual saving to the country, as above computed, according to the freetrade theory, on this one branch of the arts, is but a small part of the actual operation of this industry upon the general welfare. It promotes, sustains, and improves a long train of arts, it is not easy to say how many, which are very important to the sustenance, com * The duty on the import is of course included in the price of the manufactured article. We imported from abroad $18,000,000 of cottons in 1847-8, say $12,000,000
from Great Britain. Let the price of the cloth be 33 1-3 cts. per lb. This gives 36,000,000 lbs. of the cotton that we take back in the form of cotton-cloths. Calling the value of cotton at Liverpool 10 cts. per lb., we hiave its value there on which the duty would be paid, $3,600,000; five per cent. on which is $180,000, the amount that would have been thus paid by us for the duty at Liverpool. 195

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PROPOSITION LII. fort, and happiness of the population of every part of the country. It gives a certain market for two hundred and sixty millions pounds of cotton for domestic consumption, and twentyfive millions of pounds for exportation; amounting to between twenty-six and thirty millions of dollars, annually; and makes a certain home market for provisions, and various products of agriculture, and those of divers collateral and auxiliary arts to the amount of some seventeen to twenty millions of dollars more. This single branch of business opens a market for provisions produced in the country equal probably to one half, at least, of our entire export to all foreign countries. The producers of wheat, corn, rye, potatoes, fruits, cotton, rice, and sugar, will, generally, very cheerfully acknowledge their obligations to it; if any do not, this, though it may show an unsocial temper on their part, will not prove that they are not benefited. This same branch of industry, among divers others no less important, is of itself of such magnitude, that the progress of the country on the one hand, or its distress and decay on the other, depend upon its being sustained by legislation, or let die out. The same is true of the tanning of leather, and some branches of its manufacture; the making of iron, and some branches of its manufacture; the production of wool, and also its manufacture. The depression and suspension of some branches of domestic production, are, in fact, at this time, precipitating the country towards an abyss. Now, for three years that the country has suffered the affliction of the tariff of 1846, in its full force, it has been thereby gratuitously embarrassed by contributing its custom in order to employ paupers resident in Europe, and by defraying the expense of supporting here the myriads of European paupers and crim 196

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PROPOSITION LII. inals consigned to us, to be maintained by the public in the poor-houses and penitentiaries. Besides the proceeds of all the exports we can possibly force into all the markets of the world, we have remitted, annually, some ten millions of stocks to pay for the inundation of cheap imports, with which to overwhelm ourselves, and still the private foreign debts are continually augmenting in amount. While we are thus precipitated along the rapids, with the painful foreboding whither, we are consoled in the descent, by the glorification of the freetrade experimenters, in the brilliant success of their experiment. One of the silent, but eventually prostrating effects of that act upon our industry, is the enhancement of the rate of interest. Adam Smith supposes a regular coincidence of the rate of interest and that of profits, making each the sure index of the other; which is one of his common sophisms, namely, taking a proposition that is sometimes true as being always so, or one that is half true, as being wholly so; for interest is enhanced by a struggle against low profits, as well as by the prospect of high profits, as we frequently witness. This is M. Bastat’s ” incomplete syllogism.” It is in a great degree the sinister operation of that tariff, that has caused the recent enhancement of the rate of interest. At the time of its going into effect, the rate was five, to five and a half per cent. It was difficult to make a desirable and safe investment in the large money markets at six per cent. The current rate on good business paper has, on an average, since then, been-nine per cent. at least. Take the estimate of the annual income of the country, made by the last commissioner of patents,* who puts it at * Edmund Burke, Esq., since one of the editors, with Mr. Ritchie, of the Washington Union. See Rep. for 1848, p. 719, etc.

17* 197

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PROPOSITION LII. 2,323,564,756 dollars. Call it less than half as much -
for his plan of making the estimates includes divers things twice, and some that should not be included for our present purpose-say $1,000,000,000. Say, that the active persons in the community, who carry on its industry, have paid three per cent. per annum for loans and credits, in consequence of that tariff, more than they would have paid, had it not been inflicted on the country. Say that a fifth part of the production is carried on by loans and credit, this makes a tax upon the industry of the country of $60,000,000 annually; say a tenth part is so carried on, this makes a tax of $30,000,000; say a twentieth, which is certainly too low, this makes such a tax of $15,000,000, paid by industry to capital, for the last three years, in consequence of a tariff eulogized by its concoctors, as designed to protect industry against capital. This desired effect (for its projectors expressly proposed to stop the progress of manufactures, that is, the mechanic arts generally) is produced first by surcharging the country with imports, and thus drawing specie abroad; second, by depressing the useful arts and diminishing the income of those who carry them on, and thus compelling them to resort more to borrowing.

In consequence of that tariff, two sets of operators have, therefore, been pressing upon the money market to enhance the rate of interest; namely, first, the agents of the foreign manufacturers, who have come in for specie to pay the balance of our consumption of their goods, over the amount of all our exports to all countries; and, second, those persons who carry on our mechanic arts, who needed greater loans. The lucky person, therefore, who lives by discounting business paper, has thus, by means of this tariff, an increase of fifty per cent. on his income. It is not any subject of reproach to him 198

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PROPOSITION LII. that he avails himself of the advantage thus offered: on the contrary, he renders as much service to others by lending at whatever is the current rate, as they to him by borrowing; but it is a matter of reproach to those, who, by their policy, produced a state of things so sinister in effect upon the industrial and productive prosperity to the country. Another advantage, therefore, of this same branch of cotton manufacturers, is, that it prevents this depressing annual foreign balance from being as large as it would otherwise be, by some two and a half millions of dollars, for the exports of domestic manufactured fabrics of cotton sell abroad for so much more than the cotton could be sold for of which they are made, admitting that its market price abroad would not by that additional export, have been reduced. This article is only, as already said, taken as a specimen of the effects of protection, and an illustration of its opera, tion in the different qualities of goods of other descriptions. It would be a great labor to me, and tedious to yourself, to go through with the other forty-eight manufactured articles of exports, besides cotton goods and coin, enumerated in the returns for the year above referred to. Their amount is about eleven millions, that is, about twice that of the exports of manufactured cottons. In some of these, the enhancement of the value of the products by the mechanical and chemical processes performed upon the materials of which they consist, is much greater, in others much less, than in the case of manufactured cottons. Assume it to be, on an average, the same. In many of them, as musical instruments, paper, books, printing presses, glass, etc., the materials would be of trivial value if exported; in others, as carriages, iron in the manufactures out of it, and household furniture, amounting to over a million and a half, the materials would not be exported at all. In other instances, as 199

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PROPOSITION LII. sperm candles, the materials might have been exported, and, if they could have found a foreign market, would have sold for a very considerable part of the price of the manufactured article. Say that, on an average, the value of the manufactured articles bears the same proportion to that of the material, as in cottons. By this estimate we have an additional amount of near five millions put into the foreign markets, in these articles, by means of our useful arts, to help to pay for our imports. And yet Mr. Secretary Walker, and his school, would recommend to abolish the arts, and rely wholly upon the export of raw materials, not only to pay for as much as we now import, but for immensely more. Freetrade logic beats the old romances of chivalry, in inventing monstrous improbabilities. If I had data and time, and could presume on your patience, to go through with all the other articles subject to duty, and of the same kinds as are produced by our own domestic industry, such as the fifteen millions of imported woolens; one million of imported hats, caps and bonnets; six millions and a half of iron and steel manufactures; nearly a million of glass, etc.; and analyze the operation of a protective tariff on each class, as in the case of cottons, and make an account current on each, after the freetrade fashion of stating such an account, I am confident that in most of these, the balance would, even in that way of estimating, be proportionally much greater in favor of protection by duties, than it has been shown to be in cottons. It is not, however, necesssary for the present purpose to tax my own industry or your patience to that degree, since though, by this way of estimating, erroneous and illusory as it is in favor of free trade, the balance thus resulting were against protection, it would be of very little weight. What signifies a statement of an account that leaves out the largest 200

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PROPOSITION LII. amounts on the credit side? Where, as in cottons, or any other article, the balance, made out according to the freetrade theory, is in favor of the domestic production, notwithstanding the omission of the greatest items on that side, this is conclusive against the theory of free trade. It is in that regard only, that I thus present it. Another object in thus presenting this question, is, to show the manner in which it seems to be necessary to examine the operation of protection, and the results of progress in any branch of domestic production, in consequence of protection, in respect to the money price of the product to the consumer, compared to what it would otherwise be. This is a matter that comes into the consideration of the reasons for and against the protection of an article, but instead of being the only one, it is but-one among others, in respect to a very numerous class of articles, as has been already shown. The state of the case changes from time to time, in respect to the same article, as is obvious; one rate of protection being expedient now, another ten years hence. The money price, under domestic production induced by protection, or on free import, considered in respect to the present time and the future, in peace and war, in times of scarcity and those of plenty, being one of the questions proper for investigation in determining on the expediency of protection and its requisite degrees, it is essential to adopt a true method for ascertaining the effect on that price. In regard to some articles, it might appear that by sustaining the domestic production by protective legislation, the price to the consumer will be considerably enhanced on an average, in the long run. If it is not thereby thus enhanced, then there is no question of the expediency of sustaining the domestic production. If it is so enhanced, then the ques 201

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PROPOSITION LIV. tion is how much; and the rate of the duty is not an infallible index of the degree of enhancement, as I think I am authorized to say has been made manifest. LIII. Our foreign commerce small in comparison with domestic -Free trade magnifies the foreign. The old cry against the encouragement of our domestic arts was that it would annihilate commerce.* This is become obsolete, but we are too apt to overlook the comparative importance of the foreign and domestic-trade. Mr.

Walker puts our annual domestic commerce at five hundred millions,t being four times the amount of our foreign trade in provisions and raw materials, that is to say, the export commerce which he and his school maintain should be the sole export commerce of the country. As far then as commerce is concerned, it will probably be readily conceded that it is easier to increase this trade one quarter by protection, than to double the foreign commerce, by free trade; or than to increase that commerce one twentieth part in that way. LIV. The domestic market steady; permanent; can be relied upon — Foreign, fluctuating and precarious Free trade looks only at the foreign. The magnitude of domestic production and coastwise trade compared with foreign imports, appears under other heads; the production being eight to one, and the trade four to one. There are other differences between the two, not less important. * Examination of Baldwin’s Proposed Tariff. New York, 1821. t Rep., December, 1847. 202

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PROPOSITION LIV. Foreign trade is generally of a precarious and unsteady character. A trade between countries of entirely different climates and pursuits is, however, much more steady and to be relied upon, than between those of similar products and habits. Thus our trade with the West Indies and South America in sundry articles from the north, and with Europe in some of the staples of the south, though liable to change, as is all foreign commerce whatsoever, still is not subject to such sudden fluctuations and reverses as a trade with Europe in provisions and all raw materials of common production there and here. And then of all articles, those of provisions and others of a perishable nature, are most uncertain, since though the surplus of one country may come in to supply the deficiency of another, yet the surplus of one year cannot, as in Egypt in Joseph’s time, be kept, to any great extent, to supply the scarcity of the next. And we may safely lay it down as a general proposition, that any one whose means of industry, and consequently his welfare, depend upon the contingencies of the seasons, and the political relations and legislation in other quarters of the globe, is not so secure as he whose data for his calculations are more within his reach. Though variations in supply and demand, and in prices and in the means of employment for the industrious, are constantly taking place all over the world, both near and at a distance, yet the relations of those under the same government, whether of commerce or any other mutual dependence, are less sudden and surprising, and more easily foreseen, and consequently less disastrous, when they happen. These latter relations are, on this account, incomparably preferable.* * See Mr. Hudson’s remarks on the fluctuation in the foreign markets for wheat, in the Report of the Committee of Ways and Means, 1848-9. 203

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PROPOSITION LV. LV. An ad valorem duty is unequal; leads to fraudsa. The question of ad valorem and specific duties on articles of the kinds produced by our own domestic industry, has been so perspicuously presented in Mr. Secretary Meridith’s report, in December, 1849, that I hesitate whether to say anything upon it, and I shall treat it very cursorily. At this stage of our inquiries, I presume upon its being conceded that the constitution expressly, literally in terms, also by implication and recognition, gives Congress power to impose a duty for the sole purpose of protecting the domestic production. It has also, as clearly, the power to prohibit the importation of any article, as appears beyond question, from the general powers granted, and also from the provision against the prohibition of a particular “importation” viz. that of slaves, prior to the year 1808, which would be an absurdity, if it had not the general power to prohibit importations. But where the object is substantially and in general to suppress a species of importation, the way usually preferred, is by a high duty, instead of an absolute prohibition; and it has been considered to be the preferable method, for over eighty years at least, this being the way recommended by Sir James D. Steuart, in 1767.

Congress exercises the power of imposing duties, as it does, or ought to, its powers for the promotion of the general welfare, and this may require the check or suppression of the importation of one or another article for divers reasons, or according to specified varying conditions and circumstances provided for in the law. Thus it may be adapted to such circumstances, at the time being, by the sliding scale of admission or exclusion, according to the market price; the objection to which form is not in the constitution, 204

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PROPOSITION LV. but the inconveniences in applying it, in the mode adopted in England. At least, so I suppose, for it is not necessary to follow that inquiry here, since the exigency in view in these inquiries may be generally met by a specific limit of the duty, as experience has proved, and as would be obvious without experience. The motives determining the form and rate of duty are divers, as raising revenue; uniformity in all the different ports; facility and precision in estimating it, so as to save the importer and the public from the mistakes, prejudices, partialities, caprices, incapacity, and ignorance, where there are such, of custom-house officers; equality between American and foreign importers, or the preference of the former; favoring honest men; checking some vice, as intemperance’; causing the duty to bear upon luxuries and superfluities as far as may be, instead of necessaries; providing for a home supply of articles indispensable in time of war; securing a domestic and steady supply for ordinary wants; the promotion of domestic industry, and domestic arts, literature and science. These are all just grounds of discussion, and afford ample range, without outraging common sense with extravagant conceits and cavils going to nullify the constitution. Among these various motives, bearing upon the selection of the subjects of the duty, and determining its form and rate, we are occupied, especially with the influence on industry and arts, and on our own foreign trade, which influence, however, is much connected with the other considerations to be regarded in the decision. Domestic arts and industry are esteemed to be proper subjects of consideration in legislation, by the greater part of people, I believe, and at present I assume that they really are so. I ask your consent to the proposition, that it is more important to you, that the 205 is

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PROPOSITION LV. mechanic, maker of hats, shoes, clocks, clothes, books, pictures, and so on through the whole catalogue, living in the same neighborhood or under the same jurisdiction with yourself, is skilful and fully employed, and prosperous, than that one in Europe or India is so; and also to the proposition that it is for your interest, and is your duty as a fellow citizen, to promote the business of American merchants, and navigators, in preference to that of their foreign competitors. The reason of my asking your assent to those propositions, here, is, that what little I propose to say on the present subject presupposes them; and I am aware that they are denied by the professors of the sublimated political economy, claimed to be a science. If you dissent, I can only refer you to the other heads where I have considered those propositions; if you assent to them, then you are opposed to ad valorem duties predicated on the supposed cost of imports, in all cases where specific duties can be conveniently adopted. Such duty ad valorem favors the knave to the prejudice of the honest man, and prefers the foreign importer to the American, for the goods cost the foreigner less, in fact, and, in very many instances, to a still greater degree less in falsehood; and this was the consideration that apparently influenced the projectors of the tariff of 1846 to propose that system. Its object was, probably, what was urged by Mr. Secretary Walker in his report of 1848, to be so desirable, namely, the suppression of domestic arts for the purpose, as he preposterously pretends, of promoting agriculture and preserving the sources of revenue from being dried up. He may have, bona fide, considered these to be valid reasons; for thinkers of even our enlightened age do, now and then, very sincerely announce very eccentric no tions. But I am, in this place, presuming you, as already said, to think otherwise. 206

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PROPOSITION LV. All experience has conclusively proved the prejudicial operation of ad valorem duties on the interest and business of honest importers, as distinguished from dishonest, and of American importers, as distinguished from foreign. It is plainly desirable, wherever it is practicable, to assess a duty by some criterion independent of the oath of the importer, and of the arbitrary discretion of reveniue officers, and also to make it uniform in all the different ports. This may be effected in many articles by specific duties, and in others it may be approximated to by the minimum principle, whereas the ad valorem rule makes as many rates of duty on the same article as there are foreign ports from which it is imported, and domestic ports of entry. This objection touches both importers and consumers. These objections to the ad valorem rule are sufficient; and its prejudicial operation upon domestic industry and arts, is one of equal weight. Everybody knows that the market price of every article varies from time to time. One sort of article will rarely vary over five or ten per cent.; another will vibrate up and down, at no long distance of time, within the range of twenty per cent., another thirty, and so on. The price rises in consequence of a brisk demand, and con sequent prosperous business, both in producing, or making and vending the article; and the higher it rises, the greater the protection to the domestic production, since a duty of ten per cent. on a market price of one dollar, is twice as much as the same rate on a market price of fifty cents for the same thing; and, considered as an encouragement to the domestic production of the thing, is in the high price, double what it is in the low one, for under the high price it gives the domestic producer an advantage in our market, over the foreign one, of ten cents, in the other five cents. I state the operation thus particularly, supposing myself to be ad 207

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PROPOSITION LV. dressing a person not conversant with the subject, which I suggest by way of apology to one who is so. This will be an irregular and variable protection, adequate for a course of years and then ceasing to be so, or adequate one year and inadequate the next, and so vibrating perpetually. We have ancient authority for the maxim that a people is miserable where the law is vague and doubtful, and such is the condition of the domestic producer under the operation of such a revenue-law, for he can never know what to calculate upon in his business for six months to come. What is most disastrous to him in a rate of duty on this principle, is, that it gives him a great advantage over the foreign competitor when he least needs any, and very little at the times when he needs it most, or the only times, perhaps, when he needs it at all; for it is when demand is rife in the general market, and the price of the article rising, or sustained at a high rate, that the foreign competitor has least motive to avail himself of this market, as consumers in other foreign countries will then take off his products largely, at a good profit, and our domestic producer is accordingly not stringently pressed upon, in the competition from abroad. When, vice versa, the price is at a low point in the general market, the domestic producer and his foreign competitor are both straitened in their business, and their profit is reduced by degrees until it comes to the point of zero, and next, of absolute loss, for he cannot instantaneously stop the nmotion of a large train of business, proceeding with a great momentum, any more than a long train of heavy-freighted railroad cars can be so stopped. It is precisely at this period that the ad valorem duty affords the least obstacle to the influx of the foreign commodity, and at that same time, the foreign producer feeling the pressure of the state of the market in like manner, seeks 208

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PROPOSITION LVI. most eagerly abroad where to throw off the oppressive burthen of his own products, perhaps even at a loss on the cost, which is often, in such a dilemma, the smaller sacrifice. Notwithstanding such fluctuations, and untoward operation of the ad valorem scale, it must be resorted to in some kinds of imports, because no other convenient criterion of the rate of duty can be devised. But the above objections to it are so weighty and so obvious, that one is excusable for looking about for some obliquity of purpose or theory, when anybody advocates it as being the best general system. LVI. Import duty is less burthensome, and is not attended by greater inequality than revenue raised in other ways Free trade pretends that it is unequal, etc. The system of revenue by import to meet the expenses of the general government, in concurrence with a revenue by assessment on property and income and by excise in the separate states, is altogether as equal in its operation as can be devised; but the part of it coming in the form of an enhancement of the price of an article, where it comes at all, is not more unequal than any other. It falls entirely upon consumption, and is in the proportion of each individual’s consumption of the article. Such a tax is probably as fairly proportioned as any other to the ability of each person to pay it.

A tax either according to amount of property, or that of income, would, if it were the only one, be very much out of proportion to the ability of people to pay. You will at a glance see many persons within your own knowledge, of very considerable, and even large, incomes, who, by reason of infirmity, or some incumbrance imposed upon them by their domestic circumstances, or social position, or by their own generous 1s~ 209

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PROPOSITION LVI. and kind disposition, are restricted to very limited expenditures for their own support or the indulgence of taste. A like disproportion would be incident to a tax levied according to the amount of property. The most equal system of revenue would be on the amount of property, income, and expenditure combined. In what proportions they should be combined, is a question of practical detail, to be governed by the varying circumstances, and not within the range of our inquiries. The position at which we rest is, that the amount of consumption is an essential element in an equal system of taxation; and revenue by impost belongs, necessarily, to a great extent, and mnay wholly belong to that element. How far it so belongs, will depend on the kind of articles that are subject to the impost. Not many persons object to this species of revenue, and those who do, are mostly of the radical class, who are for eradicating everything, and who plant nothing. Admitting, then, that such a tax is a proper element in the system, as you most probably would have done in the outset, you will readily agree that it is, of all species of taxes, the least offensive to levy, where it is pre-paid on a large quantity of commodities at once, by the party who puts them into the market, as is usual in respect to duties on imports, and also in those descriptions of excise that are in use in the States, such as auction taxes, and bank taxes, for the exaction can always be anticipated, and the amount known beforehand, and it is paid by a party who expects to reimburse himself, or who merely represents others, and to whom, therefore, the aspect of the officer making the exaction, or acknowledging the receipt, is not especially horrid. Again, revenue thus derived, falls less burthensomely than in any other form, for it may be so apportioned as to fall very lightly on articles of indispensable necessity to all 210

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PROPOSITION LVII. persons, and bear with proportionally greater weight upon those articles that may be forgone without distress. This gives to people for the most part, the option whether to consume the articles and pay the tax or not, in which circumstance duty on imports is distinguished from a land-tax, and many other forms of direct taxation. This may suffice, as far as protection and free trade are concerned, on this subject, though in itself of vast extent, when analyzed for the purpose of devising a system of revenue. LVII. Investments made under sanction of law, should not be recklessly destroyed by law-Free trade abjures good faith in quest of present low money price. Though the advocates of vested rights sometimes stretch the doctrine so as to shelter public wrongs, yet nobody will carry radicalism so far as to hold that in legislation no regard is to be had to the destruction of property, that may be thereby occasioned. A pupil of the Edinburgh political economy should be the last to maintain such a doctrine, since his sect hold public wealth, and the aggregate of individual wealth, to be identical, and that whatever is prejudicial to an individual, is so to the community, and the destruction of his property is surely to his prejudice. It has been remarked already, that a vast amount of the individual wealth in every civilized community, consists of its fixtures, machinery, tools, implements, and apparatus of industry, insomuch that a nation can hardly be esteemed to be wealthy, that does not include in its schedule vast amounts of these kinds of property. Whenever, by reason of sinister legislation, or any other cause, any of the productive arts retrograde, and especially when they are broken 211

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PROPOSITION LVIII. up, the value of all property of the kinds in question, is depreciated, and much of it annihilated. This is an evil to the community, attended with great individual calamity. You say it is counterpoised by the incidental advantages. That is considered under other heads. The present point is, that it is disastrous, and that the destruction thus occasioned is to be taken into account in determining on any course of policy. And it is marvellous to witness with what self-complacent indifference some political economists contemplate this destructiveness of their policy. LVIII. Daager to the domestic arts from domestic compe tition, needs not to be guarded against-Free traders affect to be alarmed for them on this score. Our own producers must stand the brunt of competition with each other. No protectionist pretends the contrary. The only security against it would be a monopoly, which nobody asks for. Our freetrade advocates affect to be anxious lest, under encouragement of the domestic arts, our producers should be stimulated to too sharp a contest for the market, and be ruined by competition in underselling each other.* On the other hand, the vindicator of the same theory, in the Edinburgh Review,t complains that under protection the producers become slack and drowsy, and need, ever and anon, to be stimulated by the freetrade spur. We may dismiss this subject, then, with these two counterpoising authorities on the opposite sides of the balance.

* Walker’s Rep., 1848. 212 t July, 1849.

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PROPOSITION LIX. LIX. Protection should be proportionate, and adequate. It is a plain result of the foregoing inquiries, that, so far as protection to domestic industry is concerned, the rate of duty ought to be adequate for its purpose, or it will be useless, or hurtful. If it is put at a rate which will just sustain any domestic production at a favorable time, when the material is low and the outlay small, in comparison with the price of the product, and let in a flood of imports on every slight unfavorable change, the certain consequence is, the destruction of that industry, accompanied by the sacrifice, to the country, in the value of the tools, machinery, fixtures, and apparatus belonging to it; the ruin of those employed in it and concerned in conducting it; and, the loss of the value of their skill, and also that of their time until they can learn or find a new employment. You say, perhaps, “They must take their chance.” So if the question were respecting a provision to suppress trespass or robbery, you might say the same. Men form social institutions for the very reason that it is not convenient, separately, to take their chance; and the principle bears as directly upon their industry, as it does upon their personal safety. It is identical with the safety of their property. There are sinister chances enough left for the individual, after the government has done its part in diminishing them. If, instead of so doing, it endeavors to multiply them, as the projectors of our tariff of 1846 did, it is an outrageous abuse of its functions. No, - it being once settled that protection to a specific industry and employment of capital, is expedient, the interest of the country, and that of those concerned; economy, both public and private, plainly require that the support should be adequate and effectual. 213

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PROPOSITION LXI. LX. It does not appear that there is any alarming danger of smuggling-Free trade pretends danger of smug gling, and yet facilitates the evasion of duties by false invoices. One of the old cries against protection, was the infinite troubles and crimes of smuggling, thence to arise; but this objection seems to have become almost obsolete.* The free traders have not the same fear of the evasion of duties by the false invoices of foreign importers, under the ad valorem duty, which is equivalent to smuggling aggravated by perjury. LXI. Our whole exports bear a small proportion to our whole production, and our whole imports in like manner to consumption-Free trade exaggerates their compar ative importance. We have seen t that the whole amount of our foreign trade, is small in comparison with our domestic trade. The proportion of the amount of the exports and imports between the United States and foreign countries to that of our domestic products consumed in the country, is but half as large; and yet freetraders are always harping upon the former, as if the one ninth that we exchange with foreign countries, were of more importance than the eight ninths produced and consumed at home. Our exchanges between different parts of the country, are four times as much as those that we make with foreign countries, and our consump * Mr. Walker enumerates it in his catalogue of 1848. t Prop. liv.

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PROPOSITION LXII. tion of domestic products is eight times that of imported articles.* Adam Smith, therefore, well said that “Every country is necessarily the best and most extensive market for the greater part of the productions of its own industry.” t We accordingly see that the increase of our production and consumption of domestic products one quarter, by encouraging the domestic arts, is equivalent in amount, to doubling our exports and imports; and the former depends wholly upon ourselves and is not only practicable, but easy to be done in a short period, and is certain and constant; the latter depends on foreign countries, and is not merely difficult to be done at all, but if practicable, can at the best be affected only after a long series of years, and is subject to a thousand contingencies and fluctuations. LXII.

Constant never-ceasing extension and improvement and change of the arts, require corresponding modif cations of the law-Free trade teaches that legislation should stand at the dead point. It is matter of surprise to hear people imply that the affairs of a nation relative to revenue and protection of industry and property, were a sort of thousand-years clock, which needed only to be wound up, and might then be left to go for thirty generations. The act of Congress of 1831, known as one of that sort called compromise acts, has been claimed as predicated upon such a notion. The principles according to which a chronometer or a na * Assume the annual production of the country to be eleven hundred millions. Our average annual exports of raw products for three years prior to July 1, 1848, was $114,000,000; call it $120,000,000. t Wealth of Nations, B. 5, c. 2, art.

4. VoL 3, p. 374. Edinb. Ed., 1806. 215

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PROPOSITION LXIII. tion is constituted and regulated may continue to be the same, but something is required to be done, from time to time, in applying them to new circumstances. It is true that an isolated nation, such as the Japanese and Chinese have been, may become, politically, morally, and in matters of economy, petrified like that city of the Arabian tales, whose inhabitants were transformed to stone in whatever attitudes and acts they happened to be. We have not as yet suffered such a transformation, though we have experienced, from timne to time, some analogous symtoms in the ossification of our living arteries, brought on by spells of free trade; and the teachers of that science strenuously recommend to us to retrace our steps, and to relapse into what they call the “normal” state of mere husbandminen, herdsmen, and shepherds, at least, if not to copy the Buenos Ayres example of living by lassoing wild cattle. It proposes the adoption of an unchangable economical code, comprised in the one sentence, “Let industry encourage and protect itself;” and that, thereupon, the crank of the legislative machinery, should, for all economical purposes, stand forever at the dead point. But this will not do; the affairs of the world are perpetually moving and changing, and we must move with them. LXII. The country must always have more or less infant arts until it passes its meridian-Free trade supposes that we go per saltum to the summit of the arts. “Will our manufactures ever cease to be infant until they are weaned from legislative protection?” says the freetrader.* No, they most assuredly will never be old enough * Secretary Walker’s Report, 1848. 216

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PROPOSITION LXIII. to be weaned from that protection. “We have called them so (viz., infant) for sixty years,” says the same authority. That goes back thirty or forty years before most of them saw the light. But it is to be hoped that we shall, for a thousand years to come, continue to have infant arts, that is, new arts of one kind after another, to be protected by legislation, and that such protection will continue to be extended to both infant and mature arts, as well as to infant and mature people. For what other purpose do we have legislation? If by the inquiry, “When will our arts cease to be infant?” be meant, “When will they arrive at their ne plus ultra, in number and improvement? when will they come to the point of perfection where nothing can be added or changed for the better?” we may well hope that this never will be. This would be the stand-still point from which deeline and decay begin. Arts can never advance to the utmost bounds of human invention, and exhaust all the possibilities of improvement. They may easily be checked and arrested in their progress under pretence of being let alone. But so long as such a judgment of outlawry shall not be passed against them, they will advance by one improvement giving rise to another, so as to propagate infant arts in an infinite series. Theorists seem to think it possible for the artisans of a nation to pass from rudeness to the ultimate perfection in any and all arts, at a step. It required thirty years in England to introduce the power-loom so as fully to suppress the hand-loom. The people of this country have been engaged in the study of the science, and practice of the art, of music, for over two centuries, and the English much longer, and are not yet adepts of the highest order; but neither we nor they, therefore, think of giving it up in despair of having 19 217

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PROPOSITION LXV. capacity for this branch of civilization; or of remaining stationary. What you see passing under your own observation daily, will render any argument unnecessary in order to satisfy you, that the arts do not, like their ancient patroness, Minerva, instantaneously spring into existence in complete maturity and perfection. “Life is short and art is long;” that is, long in comparison with human life. LXIV. The legislation of a country, affecting its industry, should have reference to the opinions, prejudices, capa bilities, and habits of its people -Free trade disclaims any such reference. We have seen that legislation will inevitably have a decisive influence upon industry and the rights of property. The legislator must, therefore, have some regard to the character of the people, their habits, prejudices, capabilities, and skill and progress in the various arts, that he may adapt his measures to them; and thus promote their productive capacity and progress. The let-alone of free trade disclaims all such reference. LXV. Protection and encouragement are necessary to the introduction of new arts or industry; or extension of old. In some period of a nation’s existence you will see, if you look forward twenty years or more, that it may be expedient to make efforts to bring out a new art or kind of industry, or sustain an old one; which individuals cannot do without the encouragement of the laws, that is to say, the concurrence of the community, because great obstacles are to be surmounted in the beginning, or because there is 218

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PROPOSITION LXVI. a huge production of the same thing outside, which every five or six years, in a plethory of the markets, will pour out a flood of its refuse stock and drown out the beginner. Legislation should then interpose; and make it for the interest of an individual to carry on the production, either by hiring him at a salary, as in the manufacture of arms, instruction in military or naval service, or by a bounty, exclusion of the foreign production, etc. You thus reconcile the interest of the individual and that of the public. You are not taking special care of him.

You are acting merely for the public, and only remove an obstacle to his being employed in this way to the same advantage to himself, as other individuals are in other ways. The only question is, whether such a case can exist? If it can, it brings with it the expediency of protection; and is a demonstrative refutation of the doctrine of free trade. LXVI. The arts are mutually connected and dependent on one another as to the degree of skill and perfection in each; they must flourish or decay together. It has been well known, from the time of Cicero’s defence of Archias, at least, that there is among the arts and sciences a common affinity. They are connected together, interlaced and mutually dependent, one upon another. They must flourish or sink together. It follows thence, that, in those arts, which require, if carried on at all, to be carried on in large masses, the producers and laborers should have the predominating possession of our own market to a certainty, since the success and the very existence of the other ancillary arts, which will comprehend almost the whole catalogue of those to which the country is adapted, are dependent on those large branches. This is the reason that the 219

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PROPOSITION LXVI. enemies of civilization, and eulogizers of pastoral life and rude agriculture and arts, strike at these leading branches. You have seen that the extinction or arrest of any one of the great branches of our domestic industry, will inevitably be followed by decadence and decay, rude arts, clumsy implements, sluggish industry, dilapidated dwellings, and slovenly agriculture. And, in the sequel, you will see a people staggering under a load of debts abroad and debts at home, railing in turn, at the banks, the brokers, and the merchants, as the causes of the everlasting epidemic of scarcity of money; and, for a remedy, resorting to stoplaws, tender-laws, and exemption of property from liability for contracts. You will see an ill-clad, ill-fed, ill-instructed, disheartened, dejected people, with whom enterprise has ceased, and whose hope is dying out. This is not conjecture, but the authenticated history of the past, and a true representation of what the future will be, under like circumstances. It can be hardly necessary to show how intimately all the useful arts are affiliated together, and reciprocally dependent. Take any one mechanical trade with which you are familiar, or any one article of at all complicated structure, a house, a railroad-car, an elaborate piece of furniture, a book, a cloth boot, a pleasure vehicle-you can hardly choose amiss-and see how great a variety of materials, and how long a catalogue of trades are directly combined, or indirectly brought into action to produce it. The watch, though it is a more than usually complicated piece of mechanism, and one not yet undertaken in this country, that I am aware of, will serve not the worse on these accounts as an illustration. At Geneva, two hundred and fifteen distinct trades are directly concerned in the manufacture of this little piece of mechanism, without including the arts that contribute its materials.* * See Edinburgh Review, July, 1849. 220

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PROPOSITION LXVII. Then go a step further, and reflect how greatly the despatch, economy, and degree of perfection in producing an article, will be facilitated by the despatch, economy, and the degree of perfection in the arts directly and indirectly auxiliary to its production. You will inevitably come to the conclusion, that the arts are knit into one great system, and must advance or become retrograde together; and conse. quently that a blow, or neglect, affecting any one important branch, affects the whole. It may seem to you that I dwell unnecessarily upon what is obvious.

Its being obvious is one reason for insisting upon it, for the great truth that we are considering is so familiar, that we are apt not to be sufficiently impressed with its importance. Whoever, therefore, strikes at, or would neglect any important branch of production, whether agricultural or mechanical, to which the country is adapted, thereby shows himself to be hostile to the great body of the arts-in other words, to the civilization of the country. LXVII. Vicinity of arts immediately auxiliary to one another, is mutually advantageous. The mere fact of the vicinity to each other of trades and arts mutually auxiliary, is not unfrequently decisive of success or failure in prosecuting each. A foreigner came to this country sometime about 1824, and set up the business of stocking weaving, bringing with him machinery and tools for the purpose, supposing he should find it advantageous to transport his workmen and apparatus, instead of his products; and so it might have been but for the want of the arts auxiliary to his business, near by. He soon found, however, that he had to send to Europe as often as a piece 19* 221

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PROPOSITION LXVII. of machinery or tool needed to be replaced, for he had not sufficient capital to bring over the different descriptions of workmen, whose services he needed; and if he had brought them over, he could not himself alone have found employment for them. On this account, mainly, he broke up his business, and returned to Europe. The arts have made great progress in the United States since that time, and the same business is now, I understand, successfully carried on in different parts of the country. This instance serves as an illustration of a truth that is obvious to any man, who needs to avail himself of the services, or the custom, of a blacksmith, shoemaker, watchmaker, clock maker, gardener, farmer, schoolmaster, or any one else; and nobody is exempt from such wants. He will readily see that the vicinity of the person whose services or custom he needs, and the one who needs his, is of immense importance, making an advantage to him of five, to twentyfive or thirty per cent. One is, therefore, struck with the simplicity and conceited levity of some teachers of economical philosophy, who take for granted that a solitary art can be instantaneously introduced into a community, in its utmost perfection, and carried on successfully, in competition, upon equal terms, with a competitor who is surrounded with all the auxiliary arts and trades. Besides cheapness, there is an advantage to the artisan in the quality of the articles supplied to him by others in his own vicinity. He will, in the long run, be supplied with those better adapted to his particular business, than he possibly could be by workmen three thousand miles off. He will not be subject to the inconvenience of servilely following, in a subordinate provincial way, the foreign fashions and notions at a distance of a year or two in the rear. 222

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PROPOSITION LXVII. If you have been accustomed, during the past twentyfive or thirty years, to select and provide things for your own use in your trade, in any of the considerable towns that supply the wants of neighboring artisans, your own experience will suggest to you how much more satisfactorily you can be supplied now than formerly; and if you go into an inquiry for the cause, you will readily find it to be owing, in some degree, to improvement in the arts, and the increase in their variety, in your vicinity. You will readily see about you, proofs enough that the nearer you are to the place whence your tools and materials are supplied, and the more intimate your communication is with it, the better adapted to your wants they will be. This is not a reason for being supplied with everything near at hand. Numberless articles must come from a great distance, and numberless others, in like manner, be carried far away. Where circumstances admit of it, there is an immense advantage to the arts from such vicinity. This is one among the very many reasons why our own manufactures may with confidence be encouraged by legislation, and in all other ways; and it is evident that the advantages multiply, and act with a continually increasing force, with the progress of the arts and increase of our population, while the disadvantages diminish in a corresponding degree, excepting that of higher wages, which it is desirable should never disappear, though it is constantly, at every step of progress in arts, more and more compensated for. There are circumstances to discourage, or absolutely hinder, the prosecution of this or that particular art, in this or that particular locality. I am not speaking of cultivating oranges and lemons in Canada, which is so strenuously objected to by the partisans of free trade, (as if somebody proposed it,) but of the pursuit of one or another species of 223

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PROPOSITION LXVIII. production to which any place is adapted by its local position, climate, soil, and character and habits of its people. In regard to such a kind of production, we may, I think, safely say, that the introduction of any art is auxiliary to others in the same vicinity, and as far as the mere fact of juxtaposition is concerned, is mutually beneficial both to the party supplying and the party supplied, and such juxtaposition is promoted by protection, and hindered by free trade.

LXVIII. Protection of domestic industry is due to the inventive genius of outr countrymen -Inconsistency of free trade. It is strange to hear the same persons propagating the doctrines of free trade, and at the same time taking a lively interest in the inventions and improvements of our countrymen, and congratulating the country on their ingenuity. The success of the cultivation of cotton in the United States, is due, in a great degree, to Eli Whitney’s invention of the gin. That is an invention which is not adapted to the industrial pursuits of our most inconvenient competitors, the Europeans. But almost all of the improvements in the arts can be carried directly to Europe; and those of greatest and most obvious utility are so, as soon, almost, as they are brought into use in this country.* Of what avail, then, is the constitutional provision for granting patents to inventors, if, the moment an invention is brought into use in this country, (such as a nail-machine, one for dressing cloth, picking wool, cutting screws, making files, or cards, an improvement for steam navigation, and a thou * The improvements made in Ellrope are also brought to this country; but that is not material to the argument, as will be obvious. 224

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PROPOSITION LXVIII. sand others,) it is set up in England or France, where labor and interest are but three fifths of our rate, and its products sent immediately to this country free, and prevent the inventor from having any benefit whatever from his improvement, the exclusive use of which is so solemnly guarantied to him by the law, as if it might be of some value? It is precisely as if you were to give a copyright of a literary production, and then allow of the free importation and sale of foreign copies in our market. The European producers must have the advantage of the invention for their own, and all foreign markets. There is no preventing this, and no good reason to prevent it; but that they should have it in ours, to the annihilation of the value of the inventor’s patent, is preposterous. This is literally “paltering” with the inventor, and “breaking to his hope” the promise of the law; and yet this is advocated, and gravely insisted on in the name of a so-styled science, by the very persons who are at the same time pronouncing encomiums on the inventor, and demanding, in his behalf, the public gratitude. The metaphysicians in political economy, will, no doubt, be able to give some scientific reasons why it should be so, and wonder, with due self-complacency, at the narrow, uncosmopolitan sentiments of all dissenters. There are many inventions of the value of which the authors cannot be thus deprived by the legislation of the government that grants them their privilege; but no thanks to freetrade principles, which go directly to annihilate the value of the privilege, in all cases, so far as it can be done by legislation, without directly revoking it, and would, if carried out, annihilate it in the branches of industry most important for its application. It is a mere mockery, unworthy of the government of a respectable nation, to grant to an inventor the 225

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PROPOSITION LXVIII. exclusive privilege of using and vending an improved water wheel in the United States, as an encouragement and reward to him for inventing it, and at the same time adopt a course of legislation, the obvious and necessary tendency, and professed object of which is, to render such a wheel of about as much value as a wine-press would be in New Hampshire. You are much mistaken if you think this interest of patentable inventions is of very limited extent, and insignificant import in the property, industry, and future prospects and hopes of the country. So far from this, it is, in the present state of the world especially, vitally important to our political, social, and economical position. It would require a volume to analyze, in all its details, the need of all possible incentives to inventions and improvements in the processes of production, in order to sustain our industry and our civilization, in the competition they must maintain with the energies, genius, and struggles of distress, which impel forward the productivo arts in Europe. Every person has under his own observation, in whatever part of the country he may be, sufficient demonstrations of the intimate connection of the faculty of invention and improvement, with his own and the community’s wealth and growth, and even ordinary comfort and wellbeing. Free trade is Delilah’s shears to the strength of our Sampson. The arts are the inspiration, no less than the trophies, of inventive genius. They are social and gregarious. A country devoted to the production of provisions and raw materials, cannot possess, in an advanced state, the sciences and auxiliary arts most essential to its own industry. Chemistry is essential to a prosperous agriculture, but who would expect to find that science in its highest cultivation, in a community merely of agriculturists and herdsmen? You cannot have a few isolated, solitary arts, in high perfection. 226

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PROPOSITION LXVIII. Each art, in order to its success, needs the near and ready aid of a thousand others. Easy and familiar communication between artisans, excites competition, and keeps the inventive faculties in lively exercise. Ambition is thereby provoked; and reputation is quickly won by merit and skill. In order to present to your mind in a clear light, what free trade would cast away for the present, and forfeit for the future, you have but to imagine what would be the condition and resources of the country for production, defence, and physical and intellectual enjoyment, at this time, supposing the knowledge and skill in the higher and more difficult arts, such as can be acquired and maintained only by a manufacturing people, to be annihilated. Free trade holds out this, and the no less monstrous proposal of hereafter ceasing to learn and improve, as the consummate national policy. These statements I make as facts and premises. And what is the conclusion? To make a right conclusion we must take along with us the proposition early laid down and insisted on from the first, that the arts of production never did flourish in any community, and never will, without protection and encouragement; and that the notion of their spontaneous growth, as a general maxim, is as preposterous as to expect plants to yield a great crop without culture, or an uncared-for uninstructed youth to prove to be a skilful, accomplished man. The keeping alive a zeal for improvement and the activity of inventive genius, which can be done only by effective protection and encouragement to the arts, is of itself, without any other item being brought into the account, more than an equivalent for any sacrifice in the present money price, that any, not infatuated, follower of the Edinburgh Gamaliel can estimate as attendant upon an adequate protection to useful industry. 227

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PROPOSITION LXIX. LXIX. Ever since the settlement of the country, the policy of Great Britain has been to discourage and suppress the arts in America, and keep the country perpetually in a provincial state, and one of semi-civilization. During the reigns of George I. and II., an English merchant, by name Joshua Gee, wrote divers tracts concerning British manufactures, trade and navigation, which he published in a volume, in 1730. His essays had great influence on the British policy and legislation at the time, and the principles put forth by him have been acted upon down to the present day. The title of his 31st chapter is, “Plantations one great cause of enriching this nation.” It is matter of curiosity to see in What light he then viewed the colonies; it affords a key to the present policy of Great Britain towards this country. He says: “If we examine into the circumstances of the inhabitants of our plantations, and our own, it will appear that not one fourth part of their product redounds to their own profit; for out of all that comes here, they only carry back clothing, and other accommodations for their families, all which is of the manufactures and merchandize of this kingdom. “The New England and northern colonies have not commodities and products enough to send us in return for purchasing their necessary clothing, etc., but are under very great difficulties; and, therefore, any ordinary sort sells with them; and when they are grown out of fashion with us, they are new-fashioned enough there; and, therefore, those places are the great markets we have to dispose of such goods. As the colonies are a market for those sorts of goods, so they are the receptacle for young merchants [agents] who have not stocks of their own; and, therefore, all our plantations are filled with such, who receive the consignment 228

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PROPOSITION LXIX. of their friends from hence; and when they have got a sufficient stock to trade with, they generally return home, and other young men take their places; so that the continual motion and intercourse our people have into the colonies, may be compared to the bees of a hive, which go out empty, but come back again loaded, by which means the founda tions of many families are laid.” He then recommends the favoring of certain species of trade from the colonies with foreign countries, to obtain means of paying for their im ports from England, and adds, that “Every restraint and difficulty put upon our trade with them, makes them have recourse to their own products, which they manufacture; a thing of great consequence to us, and ought to be guarded against; for if they are supplied with their own manufac tures, one great advantage we should otherwise receive, is cut off, and, therefore, if care be taken to find them employ ment and turn their industry another way, now in their in fancy, it may be done with very little trouble.” Such is Joshua Gee’s proposed system of colonial policy, which was followed by Great Britain down to the revolution, backed by British legislation and enforced by British arms, as long as Great Britain was strong enough to enforce it; and since we began to achieve our independence, in 1775, the same policy has been pursued by legislation, negotiation, cajoling, threatening, and all the pliances of their immense moral, commercial, and literary influence and resources; last of all by the pretence of free trade, the very obvious, as well as expressly declared object of which, on the part of Great Britain in respect to us, is, that we shall be confined to the production of provisions and raw materials, and the making of a few coarse articles after our own former example, and the present one of Canada, Nova Scotia, New Brunswick, New Holland, etc. On the ninth of April,‘1816, 20

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PROPOSITION LXIX. Mr. Brougham, since Lord Brougham, in the House of Commons, speaking of the immense British exports to this country, after the peace, said “It was well worth while to incur a loss upon the first exportation, in order, by the glut, to stifle in the cradle, those rising manufactures in the United States which the war had forced into existence contrary to the natural course of things.” * Such was the policy of our “mother country” while we were colonies, and that of the present British free trade is the same. It is seconded and eulogized by the advocates of free trade in the United States. * See Edinburgh Review, Vol. 26, No-. 52, p. 263-4. The reader will not, I hope, understand me to be particularly anti-Anglican. The people of England and those of this country have ties that cannot be sundered. But our kinsfolk on the other side are certainly very strongly tempted by their position, to an indulgence of arrogance, and it is not surprising if the temptation is not always overcome. It unfortunately happens in this matter of protection and free trade, that they have a chance to avail themselves of one of our foibles -for we are not exempt from that phase of nationality and patriotism, denominated national vanity. Thus Mr. Walker, in his report of 1848, fancies that the British nation has been brought into the practice of free trade by the cogent logic and persuasiveness of our advocates of that system! Such conceit is really mortifying. The English have come into the profession, and what practice they have of free trade, through the influence of the merest party politics, and most likely will soon pass out of it, if they have not substantially done so in opinion and conviction already, in the like way. They may possibly turn it to temporary account in some of their foreign commercial relations with some nations whose governors and administrators fancy that they are in the new era of communism between the lion and the lamb. But the lamb had better take care of itself it may be that the lion has not wholly lost his old instincts. Great Britain is perfectly justified in looking to its own interest, but if we imagine that its interest is identical with ours, or coincides with it in regard to trade and industry in all cases whatsoever, we are in danger of buying a piece of wisdom at a very high price. Glorious Old England does not always treat its subordinates with “sentiments of profound consideration,” and has not so fallen off fronm herself as not to have less respect for an inferior or dupe, than for a sufficient opponent. I would not imply that there are no coincidences of interest between this country and Great Britain; there are many. But I do mean to say, that the particular policy which British statesmen and legislators are pursuing in parliamentary debates and negotiations, and which its writers of the now dominant party, are so strenuously seconding, is glaringly sinister to the true interests and best hopes of this country. 230

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PROPOSITION LXX, LXX. A check to inmports, and impulse given to our own production by duties, have always been followed by gen eralprosperity; and an influx of imports, induced by low duty or however else, is always followed by general depression and distress, north, south, and west. If experience had any weight against theories, sublimated metaphysics and abstractions, in the minds of the advocates of free trade, we should now have no question about the principles of protection; the only inquiry would be about (what is a fair matter of discussion) its proper subjects and degrees. This science of public economy, like many others that are necessary to be practically acted upon in affairs, is a tentative, experimental one, in which propositions are to be demonstrated only by the results of experience; and if it is possible to demonstrate anything by that process, the vital expediency of protection to domestic industry by duties on imports, has been so demonstrated. Looking back through the whole history of the country, we find that the periods of 1790, etc., 1816, etc., 1836-7, etc.,* and other times, when the influx of imports was greatest, and foreign products cheapest in our markets, and we were making those tremendous bargains in purchasing foreign goods at a low money price, which free trade glorifies so much, were those of our greatest distress, first in the ports, then in the interior and throughout the country. Those same cheap goods, if you reckon all their cost, were in fact the dearest that have ever been consumed in the country; for they cost the wreck of our own industry, with all the in dividual ruin incidental to it. * In 1819 there were in Pennsylvania about 36,000
actions for debt and confessions of judgment, including a third of the number before justices. Matthew Carey’s New Olive-Branch, Ed. 1820, p.

132. 231

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PROPOSITION LXX. Those bilious, jealous, sectional partisans, who find their own misery in the prosperity of others, and never can be happy while they fancy anybody else to be so, and who in times of general activity and prosperity in their own vicinity no less than elsewhere, cry out that they are robbed and wretched, do not (in the adverse times of low price so much desired by them) find sufficient consolation in the distress of others to make them forget their own. They then complain as loudly of their own trouble as they did before that others were not in trouble; and so they keep up a perpetual coil. Theories cannot obliterate history. The renovation and universal activity and prosperity-universal, covering every part of the country-which followed the adoption of the tariff of 1824, 1828, and 1842, especially and signally the last, were known and felt by everybody; and the records of those periods are demonstrations of the true policy of the country. Whether the encouragement given by those tariffs was in the best form, and most judiciously apportioned in all particulars, is immaterial to the present purpose. However this may have been, they were right in principle, and adequate in degree, and in fact raised the productive arts of the country to their present pitch, or rather above it, for they have of late fallen off, though less than was to be expected, and less than was intended by the projectors of the tariff of 1846, which was a unique case of a deliberate attack upon the industry of a country by its legal guardians. A foreign writer, speaking of the condition of the United States produced by protection of domestic industry, contrasts it with that of our neighbors, the British-American colonies. He says, “Against the immense accumulation of capital in the United States, and vast incidental improvements and wealth, that have arisen to the country from manufactures, 232

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PROPOSITION LXX. what have the British colonies to show? ” * and those colonies are in precisely the condition to which the British government and its auxiliaries, our advocates of free trade, propose to reduce this country. So far as the supposed interest of any section of the country, or any class of persons, whether in one part of the country or another, is concerned, it is worthy of reflection that the interest of every part and every class, industrious or not industrious, so sympathizes, and is so bound up with that of the whole country, regarded as an integer, that one should hesitate very long before coming to the conclusion, that his case, or that of his section or class, is an exception. When one compares his own personal interest, or that of his class or section, with that of the public at large, he is comparing what is near and belongs to the present, with what is more distant and is permanent; and if he would avoid a delusion, he must bear in mind that the near object has a much greater apparent magnitude than one of the same size at a distance. All the predictions of ruin to commerce, ruin to agriculture, impoverishment of the country, destruction of morals, distress of the poor, etc., etc., to arise from protection to domestic industry, have been falsified; these terrific visions have proved to be only visions, and have ceased to fright the land from its propriety. * Blackwood’s Magazine, Oct., 1849. 233

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