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Dedication
THE CHAMPIONS OF THE ETERNAL PRINCIPLE OF
UNIVERSAL JUSTICE AND ITS OFFSPRINGING
BLESSINGS -- LIBERTY, LIGHT, PROGRESS,
PROSPERITY, PEACE
AND HAPPINESS.
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Preface.
THROUGH lack of a succinct and thorough treatise on the tariff question, many, who have not sufficient leisure to make the lengthy investigation otherwise necessary to become thoroughly acquainted with the subject, have neglected to inform themselves on this the leading social question, not only of to-day, but certainly of the next twenty, perhaps of the next forty, years to come.
To meet this want by briefly yet thoroughly, plainly, and impartially explaining the whole subject, is the object of this work. To this end it is sought to condense, in this small volume, the cream of all that has been spoken and written on the subject, to avoid all lengthy and abstruse arguments, and to appeal directly to reason and common-sense through many new and original views on the subject.
While its perusal is designed to fortify and strengthen the position of those who agree with the view taken, yet it will also tend to arm those who disagree, by the knowledge it gives
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them of the "strength, position, and supplies" of the enemy; and that it may be read with profit by both sides is my sincere wish. Having been myself a Republican, whose father in 1861 was threatened with hanging for being an outspoken Abolitionist, and with not a Democrat among my entire blood-relationship, I have myself experienced how hard it is to overcome prejudice on the subject, and have therefore devoted the entire first chapter to this obstacle.D. WEBSTER GROH.
SEPTEMBER 12, 1888.
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Chapter I. Introduction.
TO the philosopher every effect evinces the existence of a cause; and the effect of two political parties, bitterly antagonistic, and yet each alike claiming patriotic motives, leads us to seek the cause thereof.
Upon investigation we find that the main object of the majority in both parties is precisely the same, namely, justice and the good and prosperity of the nation and its people. Their only difference or disagreement is in the method of accomplishing it. Just as so many religiously inclined people, through misdirected zeal and ardor, have murdered each other in disputing about the way to heaven, so these zealous advocates of justice and prosperity have slandered, misrepresented, maligned, and even fought each other about the way to secure
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national prosperity. They all sought the same end: the way of getting there was what they fought about.As much of this religious warfare and bloodshed might have been avoided by calm investigation and discussion, combined with impartial judgment and liberality, so, by the same means, much of this political warfare can be avoided and better results achieved in the end, thus saving a waste of much misdirected zeal and energy. As the final result sought by both parties is precisely the same, then the cause of the strife is plainly proven to be a misunderstanding; and, therefore, it is the bounden duty of each and every individual on either side to forthwith investigate thoroughly, openly, and freely, not only his own, but the enemy's position as well, thereby enabling him, like the skilful, prudent general, by his knowledge of the enemy, to be better prepared to combat and defeat him when encountered.
That our laws are as yet generally thought imperfect is shown by our yearly convention of Congress for the purpose of making, amending, and annulling them. The almost general belief in another and better-governed world, and the coming of the millennium, also indicates acknowledged imperfections in this.
Though none advise the putting in practice
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now of this oft-pictured ideal government, yet this implied imperfection of our present one leaves room for improvement, and, as change must necessarily accompany improvement, it is surprising to see so many people opposed to every change, as, by such opposition, they certainly oppose and retard progress. It is the predominance of this "old fogy" opposition to any innovation in China that has kept railroads, telegraphs, labor-saving machinery, and other improvements of the day from blessing that empire.It is the oft-repeated moral of that story of the "old fogy" farmer who sent his son to mill with a bag of corn to be ground into meal. In one end of the bag was the corn, and in the other a stone to balance it, as it was slung across the mule's back. It happened that a new miller had been employed at the mill, and when the meal was ground he divided it, half in one end and half in the other, thus dispensing with the stone. When the old farmer saw the new way the son had brought the meal home, he became so enraged that he soundly thrashed the boy and then sent him back to the mill with the meal, to put in the stone and bring it home the old way, remarking at the same time that "These young ones always think they know more than their daddies."
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Thus has prejudice ever stood, with uplifted hands of incredulous horror and jealous malignity, in the path of progress, to smother with its mouldy, slimy blanket of selfish conceited-perfection both the discoveries and inventions, and their authors -- the philosophers and sages of all ages.
In the past, the discoveries of Socrates, Copernicus, and Columbus have been rewarded with chains; and though prejudice, fatigued with excessive combat, seems lying dead in its tracks, yet even its carcass proves a stumbling-block to thousands.
Justice is the noblest conception of the human heart -- the foundation-rock on which is built all that is good, great, and grand in the intercourse of life, from the simplest forms of society etiquette and the common rules of business transactions up to the stern mandates of common, criminal, and international law. It is a principle deeply implanted in every breast, and, if it be the rule or gauge used in the foundation and building of all our laws, the national superstructure reared thereon must be solid, symmetrical, magnificent, everlasting.
When justice rules supreme, contention and strife must cease, because either the offending party must overstep the bounds of justice to offend, or the offended party must overstep
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justice to resent Just treatment. The essence, the climax, of all good and perfect law is justice; of all bad law, injustice ; and so long as injustice results, the law is defective and should be amended until it becomes perfect. Therefore, the test by which to know if a law is perfect is simply the question, Is it just?If not, our next step is to make it just, or as nearly so as possible. Every step toward bettering our laws is one on the road of progress toward perfection, of which the natural fruits are unbounded prosperity, peace, and happiness.
But the greatest impediment in the road of progress is prejudice, the father of ignorance. It is a lamentable fact that many voters of the present day openly refuse to investigate not only the opinions and arguments advanced by their antagonists, but they even refuse to hear a speech or read a newspaper that is not entirely of their own political complexion. The truth of this assertion is proven by the fact that you can almost invariably guess a man's politics by those of the newspaper he reads.
Every true friend of justice, liberty, and progress should beware of obstructing progress, by holding a prejudice against investigating fairly, honestly, and freely the views of his antagonists. By thoroughly acquainting yourself
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with their views, you will, like the general kept thoroughly and accurately informed by spies of the enemy's strength, supplies, position, and movements, be the better prepared to defend your own position, and win the victory, when you encounter him.If you have opinions for which you can give no good reasons, -- a sort of stolen property which you cannot tell how you came by, -- discard them, and retain only those for which good substantial reasons can be given.
Should you find some of your former views mistaken ones, the sooner you discard them and substitute for them good, sound, reasonable ones, the sooner will you be on the right side -- the strong, unimpregnable ground of truth and justice, where you can easily and fearlessly defend yourself, for it is a hundred fold easier to defend right than wrong.
But the poet's interpretation of human nature is that if you
He's of the same opinion still.
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sober second thought reminds us that no improvement can come without a change, and it follows that he who never changes any of his views remains, all through life, unimproving, unprogressive -- a condition we can conceive of only in the idiot. Consequently it is no disgrace, but rather an honor, to change opinions after due investigation of a subject, as it indicates progress and liberality of thought. "Better late than never be right, though better never late. Prove all things, and hold fast only to that which is good, true, and just."Necessity has been aptly called the mother of invention, and, with equal propriety, the spirit of investigation and experiment may be called the parent of knowledge and progress. Theory is the blossom, of which practice is the fruit, and the former must, likewise, invariably and inevitably precede the latter. As all practical knowledge in common affairs is gained by experimenting on theories, so all national progress must, fo a great extent, also depend on experiment; and as we can repeal a law when it is found injurious, we ought, for progress' sake, willingly test new and plausible theories of political economy, especially when their success has been practically demonstrated by other nations.
Justice, the twin-sister of Liberty, guarantees
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to all equal liberty, though liberty does not guarantee to all equal justice, as is often verified in this our so-called land of liberty, where we frequently have only the liberty to fight for defeated justice. Yet how precious was liberty in the sight of our forefathers, who fought, bled, and died that we might inherit its rich blessings! To them liberty meant justice, and aught that the former now lacks of the latter has been stolen through license of our indifference. It is by contrasts that we are enabled best to judge; and our forefathers, who had felt the galling yoke of oppression, and been ruled by hereditary kings and queens devoid of direct dependence on or sympathy with the people, knew, better far than we, how to appreciate liberty.As he who never was sick does not so fully appreciate health as one who has been racked with aches and pains, and spent months of agony in the confines of the sick-room, so he who never was compelled to bend the knee to a tyrant scarcely appreciates liberty at half its value. So, leastwise, it sometimes seems with us Americans.
Blessed with a land than which there is none naturally richer, either in agricultural products or minerals, none healthier or more diversified to suit all tastes, in short, the garden-spot of
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the world, and governed by laws of our own making, through representatives of our choosing, and paying tribute to none, we ought to be the happiest, the freest people on the face of the earth. But even in this very freedom lie the fetters that are to bind us and our children, if we feel ourselves so secure that we can sleep when we should be awake. Liberty has its duties as well as slavery its chains, and the former can no more be shirked than the latter. Eternal vigilance is the price of liberty. The first duty of him who would enjoy liberty is to obey existing laws and help enforce and make others obey them. But his most urgent and exacting duty of all is to help revise old laws and make new ones, and help execute them, through the representatives he helps elect by his vote.Few, it must be confessed, appreciate at proper value this last sacred duty and privilege, for to properly fulfil it requires, yea, demands, another pressing duty, namely, to be acquainted fully with already existing general laws, their operations and effects; for how can a man propose a remedy for a disease of which he knows not the nature ? And how can voters help amend laws of which they are ignorant? It also requires a conscientious sense of justice, and a freedom from prejudice -- not only a willingness
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but a desire to investigate, freely, fully, and impartially, both sides of a question; for if prejudice disqualifies a juror, might it not equally disqualify any other voter? Yet many misguided souls, mistaking party prejudice for patriotism, persistently shut eyes, ears, and reason -- what little they have -- to all antagonistic arguments, refusing even to hear a speech or read a newspaper unless previously assured that it is perfectly in accord with their own narrow views.Many men have never, either previous or subsequent to casting their first vote, investigated the principles represented by either of the two parties or their candidates, and continue voting blindly with the same party that they, their fathers, and their grandfathers first chanced to vote with, guided only -- very often misguided, however -- by the name of a party to indicate justice.
The fallacy of such reliance in a party name is seen in the fact, that the same principles and policy are not at all times equally applicable or expedient; as when a nation declares war, which at the time may be justifiable, surely there comes a time to do the direct reverse and declare peace ; and as there comes a time to issue bonds and borrow money, so there comes a time to reverse the order and redeem the bonds and
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pay off the debts. Likewise, as there is a time when high taxes and tariffs are needed to meet the expenses of the government, so there also comes a time when those high taxes and tariff's are no longer needed and it is proper and expedient to reduce them. So, if a party adheres always to the same policy, it may sometimes be right and sometimes wrong; and again, if even it changes, may it not sometimes change too soon and sometimes not soon enough? Then, too, a party platform usually represents a plurality of principles, -- has a number of planks in its platform, as it is usually expressed, -- and while some of these may be commendable, others may be objectionable.Besides, new issues are constantly springing up, and these require to be investigated before being either indorsed or rejected, and in its decision a party is as liable as an individual to err. So he who relies on the name of a party to indicate justice and the way he should vote, and is the property of that party to such an extent that it can put its "tag" on him and count on his vote, no matter what policy or principle it represents or adopts or whom it nominates to represent them -- such a man is not worthy of the trust reposed in him by the right of suffrage. And he who "belongs" to a party -- to use a very expressive term -- and can say positively
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that he always shall "belong" to it, regardless of its future policy or candidates, makes, to say the least, a very submissive, nose-be-led, and narrow-minded admission. Yet, in spite of these facts, many men seem to think that to renounce allegiance to your party is to commit the unpardonable sin.Stirring up race prejudice, clannish animosity, sectional strife, religious fanaticism and intolerance, predicting dire results, calling independent voters by opprobrious names, and chiding men for "going back on" their party, are some of the principal artifices composing the stock-in-trade of most demagogues and machine politicians.
But the guardian angel of liberty is the sensible, unprejudiced thinker and voter who is the slave of no party, but who, with patriotic indifference to the enemy's foul darts, braves the torrent of slanderous abuse, and by holding the balance of power is the terror of all demagogues and machine politicians.
Half his present repute for the freedom to think,
And when he has thought, be his cause strong or weak,
Will risk t'other half for the freedom to speak;
Caring not for what vengeance the mob has in store,
Let that mob be the upper ten thousand or lower."
JAMES RUSSELL LOWELL
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Chapter II. The Nature and Object of Taxation.
A GOVERNMENT consists of an agreement of the people under it to submit to and help enforce a certain set of rules or laws, supposed to be the embodiment of justice, for the mutual good and general welfare of its people.
The different forms of national governments are called kingdoms, monarchies, empires, and republics. Kingdoms, empires, and monarchies are governed respectively by kings, emperors, and monarchs, who usually hold their right of office by reason of their having been born the eldest son of the deceased ruler, a right about as justly inheritable as the right of being born the master of slaves.
A republic or democracy is a government of the people, for the people, and by the people, by means of choosing or electing a President, representatives, and other officers to make and execute laws as laid down in the statute-books. Our Republic is subdivided into States, the States into Counties, and the Counties into Townships or municipalities.
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The Republic, State, County, and Township, each has a government or set of laws separate and distinct from the others, but all harmoniously in accord with the laws of all divisions above it, and each has its own officers and courts for the enforcement of its respective laws.
The salaries of the officers executing the law, and the other necessary expenses of the government, are drawn from the people by means of taxation, and the city, county, State, and Nation each exacts separately and distinctly, for its own use, such sum as is needed for these purposes. Hence there are four principal kinds of taxes, namely: municipal or city tax, collected by the city; county tax, collected by the county; State tax, collected by the State; and National tax, collected by the Nation. And the right to collect taxes from the people has always been limited exclusively to the sole purpose of paying the necessary expenses of the government economically administered.
The city, county, and State taxes, though separate items, are, in many parts of the country, collected by one and the same collector, thus saving an extra number of collectors; and these taxes are almost universally levied prorata on the property within the city, county, or State. Thus the burden of State taxation falls
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on the property-owners, who are, of all men, the most able to pay it: and the greater the amount of property an individual has, the greater his taxes; the less property he has, and the less able he is to pay, the less his taxes.For this reason our State-tax law is considered the very embodiment of justice, and there has never been any complaint against it, either by party or individual, except where the intent of this principle failed, and some large sum of money or property, through some technicality or fraud, escaped paying its proportionate share of tax.
But the National tax, though it can be and on several occasions has been collected by the same method as the State tax, has for many years been collected on almost the opposite principle observed in collecting the State tax; for it is collected in two ways, called internal revenue and tariff tax.
The internal revenue consists of a tax on whiskey and other spirituous and malt liquors, and on all forms of manufactured tobacco, paid by the manufacturer when made, but really by the consumer in the end, as whoever uses any of these articles must pay so much more for them than they could be otherwise profitably sold for were there originally no tax paid by the manufacturer. The former internal-revenue
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tax on matches was represented by a stamp, and matches are now much cheaper to the consumer since the tax and the accompanying stamp have been abolished.As this internal tax, however, now remains only on articles that are luxuries, and as any one can avoid the tax by avoiding the use of the luxury, it seems a very just tax, against which but little complaint has ever been made.
Besides, as luxuries are usually bought only after all the necessaries of life are provided for, this tax is evidently paid mostly by those who are able to use luxuries, and can therefore well afford to pay it. Then, too, the father is usually the only one in the family who uses whiskey and tobacco, while clothing, food, and similar necessaries are used by every member of the family: and surely there could be no justice, nor a single redeeming feature in freeing the, luxury of this one member of the family while taxing the necessaries of all the rest, except politicians see it in the fact that he has a vote and none of the others have.
Tobacco has been called the poor man's only luxury, and surely he is willing to cheerfully bear the tax on that single luxury rather than otherwise set a bad precedent for the rich; for how can he ask that all their luxuries be taxed if he, having only one, yet wants that one free?
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But the tariff tax, by far the heaviest part of the national tax, is raised by requiring a tax or duty that averages 47 per cent ad valorem on over four thousand different articles, for the simple privilege of landing any of them on our shores.
To fully understand the method of collecting tariff duties, the reader must know that around the boundary-line and sea-coasts of the United States are located at intervals, cities and towns called "ports of entry." All persons are forbidden, under heavy penalties, to bring any dutiable goods into this country except through these ports of entry, where are located our custom-houses, to whose officers a vessel must report and allow a thorough examination, investigation, and a charge of the lawful custom or rate of duty on each tariffed article of freight, just for the privilege of bringing it into the country.
Evading this law is called smuggling, and is practised to a considerable extent along the Canada border of Maine and other border States. This tax or duty, being paid by the parties who import or land the goods, is, of course, added to the original cost of the article, and the buyer or consumer must pay both when purchasing the article, the same as he paid the internal revenue on matches by paying an increased
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creased price for them when they were taxed. And if the tariff duties were abolished, most of the present tariffed goods would be proportionably reduced in price to consumers, the same as matches were reduced when the internal revenue was taken off them.As the tariff is thus collected from the consumer, it follows that whoever consumes most tariffed goods pays the most tariff tax; and thus the poor homeless widow, with a large family of children, may be compelled to pay more tariff tax than her stingy millionaire neighbor with a smaller family, if he chooses to confine his family expenses to the mere necessaries of life, as misers frequently do. Thus, while the State tax is, for the most part, drawn directly from the wealthy, who can best afford to pay it, the national tax is drawn, by an inverse principle, frequently more largely from the poor, the least able to stand it; and it is evident that the State tax is the rich man's tax, while the national or tariff tax is the poor man's tax, which neither the halt, the blind, nor even the beggar can escape.
Justice is inflexible; and as between two points only one straight line can be drawn, so there can also be but one way of doing justice in a given case, and consequently only one just way of collecting taxes; and if it is just to collect
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State taxes from people in proportion to their wealth or property, then it is unjust to collect the National tax by a rule which virtually inverts that principle, as our tariff tax now does. Justice requires that property and not people be taxed ; for why try to shear the sheep which has no fleece, and why take from the poor widow and orphan their few much-needed pennies, when there are thousands of rich from whose abundance the taxes will scarcely be missed? Our laws should be just to rich and poor alike; but if they err in the least, it should be rather in favor of the poor than the rich, for if the rich think the law discriminates in favor of the poor, they can at any time secure that discrimination in their favor by abandoning their wealth and becoming poor; but if the poor are discontent with their lot, they cannot with equal facility change to rich.Give the poor your wealth and they will freely pay all your taxes. But to raise our revenue by taxing the poor, who already have nothing, while we leave the millionaire off with an equal or even a less sum, is not only unjust, but extremely cruel and inhuman as well.
As the only just use to which the money raised by taxation of any kind can be put is to defraying the legitimate expenses of the government, so the only object or purpose for
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which a tax, either State or National, internal revenue or tariff, can be justly levied is for defraying those expenses.It is to the vindication of this very principle that our Republic owes her birth, in that her patriot fathers resisted unjust taxation, and thus brought on the Revolutionary War which resulted in our national emancipation. In these identical words does the Declaration of Independence arraign King George:
"For cutting off our trade with all parts of the world ; for imposing taxes on us without our consent."
The British Stamp Act of March 22, 1765, raised such a storm of disapproval that it never went into effect, and was repealed the following year.
In 1767 new duties were levied on glass, paper, printers' colors, and tea, which were also opposed so vigorously that in 1773 Parliament repealed all duties, except threepence a pound on tea, which was left on merely to show the power or right of the mother-country to impose a tax.
And even though it was so managed that tea came cheaper to the colonies than to the mother-country, as the duty of one shilling sterling was taken off all tea exported to America, and only threepence per pound charged when it
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arrived, yet the Revolution came, for it was the principle and not the amount our forefathers objected to.Yet, in face of these facts, men, dubbed statesmen, have the effrontery to tell us that the object of our national tariff taxation is mainly protection to certain private interests in the shape of mines, factories, etc., at the expense and to the detriment of the general public. How well the persistent efforts of these demagogues, lobbyists, and political buzzards have succeeded is seen in the fact that at first the object of our tariff was simply for revenue, later for revenue with protection as incident, and now we have, in many cases, a prohibitory tariff, thus destroying revenue and making protection the paramount and often the sole consideration, thereby entirely subverting and defeating the original intent of the law.
Was ever delegated power worse perverted?
The power to do a certain thing is used to prevent the doing of that very thing. For it is evident that when the tariff on an article is so high as to prohibit its importation, no government tax or tariff will be collected therefrom, though the home manufacturers may advance their price to within a few cents of the price it could be imported for, and pocket the advance themselves.
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The fact that it is a National law that is thus subverted is of much more serious moment than if it were only a State law, as from unjust and obnoxious State law there is escape by removing to another State; but from unjust National law there is no escape within the Nation's boundary; and the number of sufferers must also be vastly greater, because of the greater extent of territory over which dominion extends.
If private interests can lawfully and justly demand of the national government that it so regulate the manner of collecting its taxes as to enable them to collect from their customers, for their own special use and benefit, an equivalent tax they call protection, why can they not also demand for their own use part or all of that collected by the government ? Shall our national government be superior or subservient to the protected factories? Shall they or the national government dominate? Shall they dictate to it how and for what purpose it shall raise its taxes?
Besides, if our National law allows of a two-fold object in collecting taxes, why may not our State laws also be so construed, and private interests soon be fed and fattened by our State tax also? The fact that, as yet, no effort has been made in any State to so use them is proof
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of the tacit general understanding that State taxes can only be raised for the purpose of defraying the actual necessary expenses of the State; and the national government being simply a concentration of the feelings and intentions of those patriots who also framed the State laws, shows but too plainly that the national law was not intended to sanction such roguery either.Imagine, if you can, the cyclonic storm of indignation that would be aroused by an attempt to collect city, county, or State taxes for the avowed purpose of pensioning, for an indefinite period of time, certain private interests in the shape of mines or factories. Is it any the less a wrong because it is the poor man's tariff tax that is thus squandered instead of the rich man's property tax?
The Constitution of the United States says:
"The Congress shall have power to lay and collect taxes, duties, imposts, and excises, to pay the debts and provide for the common defence and general welfare of the United States; but all duties, imposts, and excises shall be uniform throughout the United States."
This shows on its face what the taxes were to be levied for, namely, to pay the debts and provide for the common defence and general welfare of the Nation.
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Not a word is said about this great scheme of "Protection" that monopolists tell us is the main object of national taxation, and the sole cause not only of our prosperity, but even of our very existence. On the contrary, it says, "all duties, imposts, and excises shall be uniform throughout the United States." This plainly means that one State is not to have a legislated advantage over the other, as would happen if duties were higher in some States than in others.
Yet an advantage is given to a State that has protected iron ore over one that has not even the iron ore to protect, and so on through the whole list of protected articles.
It probably also originally meant that the rate of taxation be uniform on all articles, for where one article is taxed or protected more than others there is certainly unjust discrimination.
Under the present tariff law, embracing, as it does, a duty so high on some articles that none of them is paid into the United States treasury, -- the duty on them being prohibitory, -- yet the amount of tariff tax collected annualy
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exceeds by one hundred millions of dollars the necessary expenses of the government. Unnecessary taxation is unjust taxation, and this surplus being unnecessary is therefore unjustly drawn from the pockets of the people to whom it belongs, and locked up in the U. S. treasury where it does not belong, thus contracting the volume of our currency and inviting business panics.The surplus, being unneeded, is consequently not the result of a "tariff for revenue only," because such a tariff would not admit of a surplus, but it is wholly and solely the result of a tariff for protection.
The government is but a trustee of the people, with powers limited by the deed of trust which we call the Constitution, and has no just right whatever to collect from the people a tax for any other purpose than to defray the necessary expenses of the government.
It has been aptly said that a surplus is easier handled than a deficit, and, as there is only a limited amount of money in the country, a surplus in the national treasury means a corresponding deficit in the pockets of the people. And the greater the surplus in the U.S. treasury, the greater the deficit in the people's pockets. The surplus money in the U. S. treasury belongs, therefore, not to the government, but to the
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people, from whom it has been wrung by an abuse of the power of taxation.The tariff on any foreign article, by enhancing its cost to the consumer by the precise sum of the tariff rate, enables the domestic manufacturer of a similar article to collect thereon, from his customers, a similar advance over the world's competition price; and so long as he collects anything less than that advance, his article will be bought to the exclusion of the foreign one, thus diverting all the revenue from the national treasury into his own pockets.
Thus a prohibitory tariff enables the protected manufacturer to collect a tax, while it prohibits the government itself from doing so, being, therefore, a tax wholly, entirely, and absolutely for protection.
Our tariff receipts amount to about $200,000,000 annually, and as we consume about times as much domestic as imported goods, we pay home manufacturers about, more tax, making a total of $1,000,000,000, to be divided among 50,000,000 people -- making an average tax of about $20 each, annually, for every man, woman, and child in the United States. Moreover, as four times as much domestic as foreign dutiable it is only in purchasing the imported goods that the tariff increased sum paid for the article goes
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into the U. S. treasury, while on domestic goods this advance goes, not into the U. s. treasury, but into the pockets of the protected manufacturers, it follows that we pay four times as much tax to protected home manufacturers as into the U. S. treasury.And as only about half that tax paid into the U. S. treasury is really necessary to meet the government expenses, the balance producing the surplus, it follows that we pay twice four which is eight times as much money yearly for (tariff) protection as we pay for revenue. Is it any wonder that, with an income so largely exceeding that of the U. S. government, this unscrupulous monster, "Protection," has, by corruption, money, trick, and device, almost succeeded in dominating the government? Is it not rather a wonder that it has not succeeded?
But the moments chosen for its advances have always been, for it, the most auspicious ones. When the Nation was weakened and distracted by war and the attention of her people diverted to these immediate troubles, then came protection, as Satan in the guise of the serpent, offering the much-needed revenue for the occasion.
And while the proceeds of this unjust tax were needed to pay our necessary government expenses, even though not always economically administered, the people heroically submitted
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even to its injustice without a murmur, and only since an unneeded and unused surplus has accumulated in the treasury have they begun to protest. But their protests, like the muttering of the approaching storm in the distance, are growing louder and louder, and more and more earnest, and, if passed by unheeded, will, the longer delayed, be the more fierce, terrific, and protracted when the inevitable struggle arrives.Chapter III. The Nature, Object, and Effect of Protection.
THERE are but two ways of reducing the surplus: the one, by reducing the rate of tariff to a point commensurate with the necessary expenses of the government economically administered, thus leaving the surplus in the pockets of those who earned it; the other, to continue this excessive taxation, and spend the surplus in needless, useless jobs and appropriations. This latter method is especially favored by the spoilsmen, who are anxious to plunder the people, through the treasury, as it is not so dangerous to the operator as highway robbery,
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though equally and often more profitable The surplus is a standing temptation to these harpies, and the longer it exists and the larger it grows the greater the horde of lobbyists grows constituting thereby a standing menace to our national virtue and integrity. These so-called spoilsmen -- a genteel name for political pirates and highwaymen -- think and persistently shout that the only object of each political party is to furnish its wire-pulling, machine-working, organ-grinding demagogues with a fat government office; as if our government was an eleemosynary institution, created for the sole purpose of giving a set of unscrupulous politicians a fat living, so as to keep them from stealing a living which they would be otherwise too lazy to earn, and as if the only object in voting was to determine which set of thieves was to do the plundering.Spoils can exist only as the result of ruin or robbery, and so long as the government is properly administered there can be no spoils, and those who admit themselves to be "spoilsmen," and sustain the spoilsmen's theory, thereby furnish the strongest argument against allowing them a chance to plunder the government by holding its offices of responsibility and trust.
But if the first of these two methods -- that
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of reducing the taxes -- is to be adopted, then the only question remaining to be decided is: Which taxes shall we reduce -- the internal revenue or the tariff; the taxes on luxuries or those on necessities; the taxes on whiskey and tobacco or those on food and clothing? Shall we have free rum and a "free chaw," or shall we have free (untaxed) food and clothing?Protectionists insist that the tariff tax should not be reduced, even if more money is collected from the people by the government than it needs. They say the tax should be kept on for protection to manufacturers of tariffed goods. The "idol" of the protection party, replying to the President's message, says:
"Keep on the tariff tax and divide the accumulated surplus among the States, with the specific object of lightening the tax on real estate." That is, he would collect so much of the present real-estate tax from the poor homeless people, who have no real estate to tax, by keeping on the heavy tariff tax which the poor pay, and when more money than is needed is drawn from them by the national government, use it to lighten the rich man's real-estate tax. And this, too, he advises while masquerading as the friend of the poor. It also means, one set of fat office-holders to collect the tax, and another
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other bloated set to distribute it back again to the States.Was ever a more infamous scheme to rob the poor and give the proceeds to the rich posed? For, as before shown, the State tax being a tax on property, falls only on the rich who own property, exempting those who have none ; while the tariff tax, being on consumers of tariffed goods, falls heavily on every poor man and his family: the State tax thus being the rich man's tax, and the National or tariff tax the poor man's tax. Yet this party howls its approval when its figure-head says: "Continue the National tax and reduce the State tax." The proposition to repeal the internal-revenue law, thereby abolishing the tax on whiskey to the end that this tax may be collected by the States, amounts to a virtual transfer of this sum from the poor man's National-tax: treasury to the rich man's State-tax treasury, for the evident purpose of lowering the rich man's State tax at the expense of the poor man's National tax.
But what is this protection that is so enthusiastically indorsed and advocated by the millionaire monopolist that he is willing to spend a considerable sum yearly in distributing protection literature and in lobbying and otherwise advancing its theories and interests? He insists
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that it is for the poor laborers only, and to get them high wages, that his interest is awakened and his purse-strings are thus spasmodically opened. Yet does he interest himself so much in the other affairs of the laborer to get him high wages, such as helping to organize "labor unions," helping to keep up strikes, etc.?Protection is a sweet-sounding word, and we are all ready to say, Yes, we want protection: protection from the elements, by houses ; from the extremes of temperature, by clothing; from hunger and starvation, by abundance; from the ravages of disease, by medicine; from thieves and murderers, by the police; from foreign invading foes, by a defending home army. Yes, we want protection in a thousand different ways. But what does protection in this particular instance mean?
And, as protection always conveys the idea that there is something to be protected from or against, the question naturally arises: What is it our manufacturers want protection from? Why, protection from competition. They want no competition -- a monopoly, in fact, of their line of business, so that they can set the price of their goods as high as they please, and compel our people either to pay their exorbitant prices or go without such goods, even if others would be willing to sell them similar goods at lower
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prices. They want protection in thus forcing consumers to pay the extortionate prices they ask, for if their prices were not extortionate, they would not need protection to keep from being undersold.For example, there is your pocket-knife, an article almost indispensable to every man and boy. Suppose yours is one worth a dollar in any part of the world. Then that is just what it should sell for, and just what you should pay for it, not a cent more nor less; and, supposing there was no protective tariff on knives when you bought it, was just what you did pay for it. But some protectionist comes along and says he can make knives precisely like yours, and is going to start a knife-factory "down East." As a matter of friendship, you tell him you will buy his knives hereafter when in need of any, if he makes them as good and for the same price. "Yes," says he, "I will make them precisely the same -- no better nor no worse; but," adds he, "I can't make them for a dollar. I must have $1.45 for such a dollar knife." Then you tell him frankly that you won't buy his knife after all, if he wants so much more for it than it is worth. "But," rejoins he, with a sly twinkle in his eye, "I will make you either pay that price for mine, or more than that for any similar foreign one you buy." And though
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you are astonished at his audacity, and wonder how he can accomplish his threat, he simply gets a law passed by Congress, charging fifty cents for the privilege of landing each dollar's worth of knives on our shores, which makes all foreign dollar knives add 50 cents to their price, making them sell at $1.50; and, of course, you will then pay $1.45 for the protectionist's dollar knife rather than $1.50 for a precisely similar imported one. And so long as he sells his dollar knife for $1.45, or anything less, you and everybody else buy the protectionist's knives, and not a cent of the extra money you pay goes into the U. S. treasury, but into the "protected" pockets of this monopolist knife-manufacturer; making this case one of tariff entirely for protection and not one cent for United States revenue, as is the case, in fact, with all other prohibitory tariffs.Thus this tricky knife-manufacturer has succeeded in forcing you to pay him $1.45 for his dollar knife; and though the law "protects" him in the swindle, yet it robs you of 45 cents every time you buy a dollar knife.
Thus tariff protection to one means robbery of another; and not only that, but for every one that makes knives there are ten thousand who buy them, so that protection to one man means robbery of ten thousand. The same is equally
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true of every other protected business; this is the case not only with the protected pocket-knife, but with over four thousand other protected manufactured articles in the United States to-day.Every term in language has its correlative. The word nobility implies also the peasantry, the master the servant, the tyrant the slave, the rich the poor, the thief his victim, and likewise the "protected" (robber) implies the unprotected (victim).
So we have in this country two classes of avocations, the protected and the unprotected.
As there is nothing in this world that can be received without being first given, so protection likewise falls under this same axiomatic law; and just so much protection as is received by the protected manufacturers, precisely so much robbery of their unprotected customers must be perpetrated to procure this protection. Thus many unprotected victims are legally plundered to increase the gains of the protected few; and in order to reconcile them to the robbery they are told that this benefits the Nation, makes "good times," and enriches the country.
Robbing Peter to pay Paul is no novelty, though the nation-building, wealth-increasing,
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philanthropic results of this practice are a recent discovery.That professional gamblers, bunco-steerers, highway robbers, and all other thieves are equally advantageous to the country and need "protection" in their "occupations" is equally evident; and protectionists should immediately take measures looking to the protection and amelioration of the condition of these their much-persecuted brethren.
For protectionists to demonstrate that a man can lift himself over the fence by his boot-straps is next in order. "They offer us their protection; yes, such protection as vultures give to lambs while covering and devouring them." But protectionists claim that a protective tariff does not increase the price of the protected article to the consumer; and they enumerate blankets, clothing, etc., which they aver are as cheap here as in England. Now, if this is true, what is the use of a protective tariff on these articles named, if it fails to protect or, in other words, advance the domestic price? How can such an inoperative law benefit or protect our manufacturers?
Then, again, they make the directly opposite assertion that, were it not for our protective tariff, English manufacturers would dump all their surplus goods in America at lower prices
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even than they sold them at home. In that case we should be getting the worth of our money, else we surely would not buy their goods, and our people would have the benefit of cheap goods; and, besides, if they sold goods to us so much cheaper than they sold them at home, we could make a snug profit on the Englishmen by re-shipping and selling back to them their own goods, besides underselling them in every other market in the world with their own goods.The truth, however, is that every article which here sells for more than in other countries, plus the cost of transportation, is artificially increased in price to the exact extent of that difference by our protective tariff.
That advance in price constitutes the very protection that a protective-tariff law aims to give; and should they even succeed in showing a case where there is no advance, then they would have only proven, in that instance, that protection fails to answer its design -- that protection fails to protect.
The cost of transportation should form sufficient protection to any honest business.
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Chapter IV. Protection Illustrated.
To illustrate more clearly the workings of a protective tariff, let us suppose that a laborer named A, working at an unprotected business, makes every day, from raw materials costing 50 cents, one article worth $3 in the market of the world. Then he actually earns $2.50, and is worth that sum to himself, his family, and his country every day he works and makes such an article. Another man, B, working at a protected business, makes every day, from raw material costing 50 cents, an article which, because of protection, sells here at $3.50, though in the market of the world, in competition with precisely similar articles, it sells for only $2.50, which would In fact be its price here were it not for protection. Then, after subtracting 50 cents for their raw material, A receives $2.50 for his day's work, and B receives $3 for his.
But if B's article were sold abroad, or if there were no protection here, he would receive only $2.50 minus 50 cents, which is $2, for his
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day's work, which is all he actually earns, though we pay him $3 for it; and for every one of his $2.50 articles which he sells for $3.50, and gets $1 more than it is worth, he makes some one of us pay him that extra dollar he does not earn. Besides, though B is getting 50 cents more wages per day than A, yet A really earns and is worth to his country 50 cents per day more than B; for, were it not for this law, putting an artificial value on B's product, A could trade his article in the world's market for one of B's and get 50 cents to boot, thus enriching himself as well as his country daily by one of the articles B makes and 50 cents in coin besides. Thus the Nation, by decoying B, through protection, into a business needing a subsidy paid to him by his customers, really keeps him from doing what A does, and from thus being worth one-fourth more to the country daily than he now is, besides the injustice of over-charging the consumer of B's product. Thus does protection, so far from enriching the Nation and increasing wages, actually impoverish or rob the Nation of wealth, lower unprotected laborers' wages by reducing their purchasing power, and only give the protected what they take from the unprotected without earning.Again, let us suppose four brothers. A, B, C, and D, shoemakers, live together on an
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island, of which they are the sole inhabitants. They can each in one day turn $2 worth of leather into a pair of $5 shoes, which they can readily sell at that price in the neighboring city, thus making wages at the rate of $3 per day each, and enriching themselves and the island they live on at the rate of $12 per day. But every time they receive money in the city in payment for shoes they must lay out two-fifths of it again for leather. They consult among themselves, and devise a plan to avoid this outlay of money for leather. It is this: A, B, and C are to continue shoe-making, and D is to make leather.After a year's experiment D finds that his wages as an tanner are only $2 per day, as he can on an average Just make as much leather as is needed for a pair of $5 shoes. So he complains that he, being a brother, ought to be protected against that pauper-made city leather. Now, as the money needed to defray their general expenses, such as for tools, food, clothing, building, repairing, etc., was formerly raised by equal assessments on each brother, which sum was thrown into a mutual-benefit or expense-box, where it was kept until needed, they readily agree to D's proposition to raise this expense money by throwing $1 into the expense-box for every $2 worth of foreign
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leather they buy. There seems nothing wrong or unjust about this, for, as they had these expenses before to pay, why not collect in this way as well as by direct tax? Besides, they sympathize with their unfortunate brother; and to relieve him of his share of tax seems but little; to give in return for his saving them to a certain extent from buying so much leather-abroad and thus making them more independent.Now let us see what D's shrewdness has accomplished for him by this apparently simple, harmless little protective plan. As throwing $1 into the expense-box for every $2 worth of foreign leather bought now requires an outlay of $3 for every $2 worth of foreign leather, D puts up the price of his $2 leather to $3, thus making his average daily wages $3, and freeing him besides from assessments for expenses. After a while his brothers find a shortage in their year's earnings which they cannot account for and, they begin figuring. They then discover that their day's work -- turning $3 worth of leather into a pair of $5 shoes -- leaves only $2 per day for their wages, where it was formerly $3. But D points to the fact that they now have no assessments to pay, and to the amount saved that was formerly paid out for leather, and
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that they now have some of their leather produced at home, thus making them more independent, and, with a bewildering maze of assertions, figures, and sophistry, tries to convince them that this protection is such a grand, glorious system that their very existence depends on it.But C, finally waking up to the fact that his wages at shoemaking are now only $2 per day, turns tanner also, where he can make $3 per day. Now, by this change, we have two protected tanners supplying two unprotected shoe-makers -- no money paid off the island for leather, but none going into the expense-box either; and the net result of a day's labor for all four is two pairs of $5, -- total, $10 profit, against, formerly, $20 worth of shoes, minus $8 worth of leather, leaving a net profit of $12 per day. Thus does protection work an actual loss to the four brothers as well as to the island, of $2 per day for every it is in force.
In precisely the same way does protection to a nation cause both individual and national loss, though, through the intricate maze of millions of people and thousands of various trades, it cannot be as easily traced and estimated as in the simple example here shown.
But the principle and the final result are
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the same, the only difference being in proportions.The avowed object of protection is to induce us to make things which we cannot naturally make as well as other people, for if we could, we should need no protective tariff on them.
Chapter V. National as Compared with State Charitable Laws.
TRULY the laws of nature are the laws of God, and one of nature's laws is the law of supply and demand, which justly regulates the price of all articles when not hampered by protection, blockade, or siege.
If, for instance, more wheat than is needed is produced, the price of wheat will go down, down, down, and the profits of wheat-raising become less and less, until many farmers find that their land will pay better returns from other kinds of crops, and will sow less and less wheat, leaving only the most favored wheat lands in that business, thus restricting production until it perhaps falls below the amount needed, when prices will again rise, inducing more farmers to sow wheat again, thus insuring
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each acre of land to be sown in what its soil is best adapted to supplying the demand for.If more mechanics than are needed work at manufacturing certain useful articles, they soon, overstock the market and the price of the article falls lower and lower, until it no longer affords them all living wages, and some of them are driven out into more remunerative lines of business, thus leaving only the most skilful in that particular line remaining in the old business.
Guided by this law, the laborer always works at what his service is most needed, and at the business in which he is worth most to the world, most to his country, and most to himself, and consequently always gets for his labor the highest price in the world that he is capable of earning. It is the law which invariably gives each laborer the greatest honest return for the least labor. But protection aims to subvert and defeat this natural law, by bribing him with protection or charity money to work at non-paying, bankrupting business, as its very need of protection irrefutably proves it to be, for otherwise it would not need protection to keep afloat.
But the protected monopolist, while he consider the law of "supply and demand" a just one for him to buy his bread, raw material,
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and labor by, is not willing to sell by the same just law. Says he: "I can't sell my goods to you, my workmen, neighbors, and fellow-citizens, by the same law under which I buy from you. I must have a protection of 47 per cent over and above what the law of supply and demand would give me."Is that an honest, patriotic man who, when buying goods from his neighbors and country-men, wants them weighed on a certain scales where they will weigh one-third less than they do on the scales he sells by? What is your opinion of him who wants all the goods he buys measured by a three-foot yard-stick, and all he sells by a two-foot yard-stick? Yet this is virtually what these long-faced, self-styled patriots -- the protected monopolists -- advocate and do, under license of our present protective tariff laws, which enable them in selling to escape the just and otherwise universal law of supply and demand under which they buy
Any vagabond who strives to evade that just law and cheat his countrymen, by buying his needed goods and labor under it, and in selling his goods seeks through so-called protection 47 per cent over and above the price that law would set, is a knave of no small proportions.
The wretch who, while owning millions, and
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complacently seeing his industrious fellow-men starving and freezing, yet asks the government to give him, through a high protective tariff, a monopoly of the manufacture of necessary articles of food, clothing, and other necessaries of life, so that, by thus keeping opposition and competition out of the country, he may extort, as a tribute for his overflowing coffers, a few more pennies from the shivering, half-clothed, half-fed, half-paid widow and orphan, needs only to be seen in his true light to be abhorred by all. And the hundred-fold wretch who advocates as justice and patriotism such a national policy, that he may thereby hold an office or exact a paltry favor from this millionaire for helping fill his coffers through this unjust law, needs to be unmasked also. When such a system of thievery is legalized and sanctioned by our national government, is it any wonder that we have such extremes of wealth and poverty as the hundred-fold millionaire and the starving widow living side by side!Is it any wonder that during the last twenty-five years of this system we have made more millionaires and more paupers than were ever before produced in the same length of time in the world's history, notwithstanding, the old hereditary laws of England giving all the father's inheritance to the eldest son, and all
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such kingly devices to produce extremes of wealth and poverty?The protectionist solemnly declares that without this protective bonus, above the price which the law of supply and demand would set, he could not run his business except at a loss. That is to say, that, by the law of supply and demand, his business would be a losing or bankrupting one, and, if it exists at all, not only must its profits but even its very existence depend on protection, i.e., governmental charity.
After this pauper business enterprise has been supported for years by the acknowledged charity of the public, and its owner has millions of charity money in his pockets, he goes around speechifying, and the burden of his speech is:
"Where would you people and the country be were it not for us and our protected (pauper) factories?"
The captured tramp who is made to earn a few pennies each day by work on a poor-house farm -- 50 per cent of what it costs to keep him there -- might with equal propriety shake his fist under the taxpayer's nose and exclaim, "How could you make a living were it not for me?" Indeed, our poor-house farms, whereon are confined a number of paupers who are made to earn by their work thereon, say, 25 cents per day toward furnishing themselves
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a 40-cent-per-day living, are just as much benefit to the country as a protected factory, in which the workmen obtain living wages, only by adding to what they actually earn the additional charity sum that our protective tariff adds thereto by allowing the manufacturer to charge so much more than the goods are actually worth.The fact that a business needs protection conclusively proves that it is not self-supporting, else it would not need protection; just the same as a poor-house farm, if self-supporting, would need to make no assessment on the taxpayers.
Every workman in a protected factory must admit that if he receives any extra wages through protection, then it (that extra) is so much legalized charity-money he is receiving above what the law of supply and demand would set his wages at. And if laborers in protected avocations receive any increase of wages through protection, then they are thereby placed on a plane with the paupers on our poor-house farms, because, like those paupers, they receive more, through a charitable law, than they actually earn, and must be figured in that Column.
If there is anything calculated to degrade labor, it is to make it feel that it exists to a certain extent upon charity -- that it receives more
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wages than it honestly earns; for, to the honor and pride of the laboring class, it can truly be said that there is no more honest and independent set of people on earth than they who earn their bread by the sweat of their brows.While fully indorsing charity for the deformed, superannuated, and other needy unfortunates, yet there are few who believe in needlessly converting thousands of able-bodied men into so many law-made paupers through license of a protective-tariff law. And, worst of all, while the protected wage-earner receives this bonus, the unprotected farmer and wage-earner must pay it to him, and then sell their products in competition with all this much-talked-of pauper labor, in the market of the world. Who will say that the more poor-house farms we have the richer the County or State is? and who dares to say that putting able-bodied, willing workingmen on a plane with the paupers on our poor-house farms, by putting them in pauper business establishments that need protection-money to keep afloat, is going to enrich the Nation and its people?
Their argument that protection-needing factories are a benefit to and enrich the country is as mal-philosophical as was the reasoning of the man who, thinking a bag of meal too heavy for his young horse, sat on the horse himself
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and took the bag of meal on his shoulder, in order to lighten the load. The common beggar who asks a few pennies to keep his family from starving and freezing is often locked up as a vagrant or habitual beggar. But the millionaire who asks and has received annually for twenty-five years past this legalized charity-money called protection is paraded by protectionists as a great philanthropist, because, forsooth, he gives his employés a chance to earn from him part of the wages which his customers, through protection, are forced to give him, along with a large profit for his own pocket, for running an otherwise bankrupting business!Protectionists declare that in the absence of high duties certain lines of manufacturing would perish, and that we should be then at the mercy of England, who could compel us to pay her any price she asked. Allowing that there are some lines of our present business which are naturally so bankrupting that without protection they would cease to exist here, this means we should close up another National poor-house farm -- a bankrupting, ruining business, that tempted capital and labor into a maelstrom of ruin, from which it was saved only by levying a protection tax on all its customers to keep it afloat.
Protection is never needed to tempt capital and labor into legitimate, self-supporting, paying
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business, as such business is entered without subsidy temptation, and such business has a more steady market and gives more steady employment to its workmen; while actual protection-needing business depends to a great extent on the coddling care of a political party, and is therefore as unstable and fluctuating as the party of which it is the offspring. Besides, in buying in an open market, our importers would have the same opportunity to buy cheap as Germany, Italy, or Russia, as competition sets the price of goods. Conceding that free trade might kill some few industries, yet it could only be such as are not self-supporting, and consequently are only a tax on the Nation and her honest, thrifty, self-supporting enterprises, instead of a benefit. And for every one of these protection-needing vampires exterminated, a hundred honest, self-supporting avocations will then be relieved of paying to these parasites the protection tax they now demand, and dozens of new enterprises now impossible will be born.And as one good, sound sheep is worth more than all the vermin on it, so one honest, self-supporting business is worth more to the Nation than a score of bankrupting, protection-needing, parasite-like factories which exist only by means of the protection they are allowed to sap from the former.
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But for evidence that free trade does not "kill" manufacturing as a whole, look at free-trade England, where, instead of her factories being all "killed," you find her the foremost manufacturing nation in the world. That not one out of twenty of the factories now crying for protection actually needs it, in order to exist, is proven by the fact that their owners, though continually crying, have almost invariably amassed large fortunes, many becoming millionaires.
They of course want all the money they can get; and if they could get it for the crying, they would willingly cry for a hundred-fold the tariff and hundred-fold the profits they now get. That protection beneficiaries should refuse protection is as unlikely as that slave-holders should denounce slavery.
Chapter VI. "Price of Goods Lowered and Wages Raised by Protection."
THOUSANDS of new discoveries in chemistry and philosophy, and inventions in machinery, have constantly cheapened the cost of production and lowered the price of goods.
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But protectionists, in their eagerness to attribute every blessing to their favorite theory and every curse to free trade, claim that this reduction is entirely due to protection, from which we infer that they too consider cheap goods a benefit to the consumer and the Nation, although they constantly preach the contrary, and advocate a high tariff in order to keep up the price of protected goods.
However, as the price of those identical goods has fallen proportionally as much, or even more, in free-trade England than here, as is proven by the fact that more protection than formerly is now needed to keep them out, then, to be consistent, they must also say that free trade has caused the cheapening of goods in England.
In spread-eagle-speeches they give glowing descriptions of our wealth, prosperity, and progress, of the growth and increase of railroads, telegraphs, steamboats, labor-saving machinery, etc., counting all these, and even our increase in population, as due to this magical protective system. They consider no credit due to our republican form of government and republican institutions, nor to our inventors and their productions, nor to the intelligence, thrift, and energy of our people. All these count for naught beside this grand, glorious, idolized
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"protection." To prove how wonderfully the price of protected articles has been reduced by protection, statistics are resorted to; and, as an example, they cite the price of steel rails twenty years ago as compared with present prices.Now, they must full well know that invention and not protection has caused this cheapening, as, if all steel rails were to-day made by the same process as then, and under similar circumstances, inflated currency and all, the price would doubtless go as high as then, if not higher.
Besides, the fact that they claim that these very protected goods now need more protection than they did in 1860 shows that their price has not fallen as rapidly inside as outside our protected borders, else they would not now need more protection than they did then.
Even articles which are themselves free of duty are often enhanced in price because of the tariff on articles used partly or wholly in their manufacture. Thus untariffed as well as tariffed goods are made to cost the merchant more than if there was no tariff, thus requiring a larger amount of capital to buy and carry a given amount of stock than would be required for the same stock under free trade, in this way keeping the poor of small means out of
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business, and giving more of a monopoly of business to the rich.Under this protective tariff system every store-keeper becomes a tax-collector, collecting not only the original price of the goods, plus the tariff thereon, but also all percentages of profits on this twofold outlay exacted both by himself and all other merchants through whose hands they have passed, thus causing a considerable percentage of the tariff the consumer pays to lodge, unnoticed and uncomputed, in the hands of middlemen.
Then, too, the rich can take a trip to Europe, and there buy their own clothing cheap, without tariff, while the poor must stay at home and pay the tariff on what they buy in the dear home market.
Even the rents of houses are increased because of the additional cost of building materials, thus to a certain extent restricting building, and by the scarcity of houses making higher rents. It is said that, since the adoption of a high protective tariff, not one new house has been built in Hamburg, which formerly was one of the most thriving cities in Europe.
Protectionists even ascribe our immigration to our protective tariff, forgetting that the Indians had no protective tariff that drew Columbus, the Puritans, Huguenots, and other original
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settlers here, since which time a constant stream of immigration has poured into America, regardless of high tariff or low tariff.They forget, too, that if those immigrants were seeking only the blessing (?) of a high tariff, they might find it much nearer home, in Germany, Italy, and Russia, without taking such a long, expensive, dangerous, and tiresome journey, and leaving their old friends and relatives at home so far behind as generally to preclude the possibility of ever meeting them on earth again. They also forget that more of that immigration comes from nations where they already have high protective tariffs than from free-trade England, notwithstanding the drawback that every other nationality except the English must learn a new language on arriving here.
But why do Americans from the Eastern States take Horace Greeley's advice to the young man and "go West"? Is that also due to the protective tariff? Oh, no: all this migration, both home and foreign, is due principally to the natural law of "equalization of density" of population, and results as naturally as the balloon rises in the air, because the gas therein seeks an equalization, of the density of the atmosphere.
But these protection enthusiasts, like Mr.
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Blaine's post-election telegram, want to "claim everything" as due to "protection." May not, however, our Republic, with its free institutions, be a much greater incentive to foreign immigration than this protection hobby?Because we have made rapid progress, and have enjoyed many rich blessings which are the natural and legitimate result of the glorious republican form of government bequeathed to us by our martyred forefathers, these protection hobby-riders want to arrogate to themselves and their hobby all credit for these blessings.
Because we have high wages and at the same time a high tariff they claim that there is positively a direct connection between the two, and that the latter is the cause of the former, though they can show no logical reason why. In their frantic and abortive efforts to reason without material, they signally fail to show any analogy between proposition and conclusion, as was vividly shown up by the sarcastic wit of Hon. S. S. Cox in Congress a short time since. Said he: "Protectionists argue that the United States has protection and high wages, therefore protection makes high wages. Apply the same argument to England: England has the House of Lords and low wages, therefore the House of Lords makes low wages. The United States has tramps and high wages, therefore tramps make
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high wages. Ireland has no snakes and no wages, therefore snakes make high wages."They jump at conclusions, derived from comparisons between two conditions, which, besides the matter they profess to weigh, contain a dozen other uneliminated and equally or even more ponderous dissimilar items. He who pretends to make an honest comparison without first eliminating all ponderable inequalities from both sides is like him who pretends to weigh accurately with unbalanced scales. And he who employs a single untruth or sophism thereby but proves, by the lack of the truth and logic it supplants, the desperate weakness of his cause.
They overlook the fact that wages in America, whether under high or low tariff, have always been higher than in Europe, and that immigration has also continued under both conditions.
As well say that the higher wages of our sparsely settled and thriving West over those of the overcrowded East, or, in fact, that the ever-varying rate of wages throughout the whole United States is due to protection, as that protection is the cause of American wages being higher than European.
Labor depends on the law of supply and demand to set the price of its wages; and it is no fair comparison to find how tariff affects wages,
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by putting the old, long-settled, overcrowded kingdom of England, whose population to the square mile is twenty times ours, into the scales against a young, healthy, growing, sparsely-settled, mechanic-needing republic like ours.Density of population has a great effect on wages, because it is an element of the labor-supply, and a newly-settled, sparsely-populated, growing country always needs more labor to build it up to the improved condition of an old country; and this fact is an element of the labor-demand, and both these elements operate together to produce higher wages in America than in Europe.
Where a population of over half that of the whole United States is crowded into an area of about two and a half times that of the State of New York, as is the case with England, the average wages would naturally be vastly lower from this overcrowded condition than in a young, thrifty country like ours. But by comparing the wages of free-trade England with any of her protected European neighbors, -- Germany, Austria, Italy, or Russia, -- where density of population, form of government, age, and in fact all else save tariff are similar, we find that wages in England average far higher than in any other country in Europe,
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and that the higher the nation's tariff the lower are her average wages, thus proving conclusively that, where all else is equal, free trade causes much the highest wages.Furthermore, it must be remembered that those English wages actually represent a much higher value than their face indicates, for in a free trade country a dollar will buy more of the average necessities of life than anywhere else.
Thomas G. Shearman says: "Protectionists are fond of quoting the advance of wages which nominally took place between 1863 and 1872. But that was caused by paper inflation, and workmen were actually worse off then than they had been ten years before. The average wages of 1870 were $377 in paper; but this would only buy as much as $242 did in 1860, when wages averaged $289.
"Wages in England average at least 50 per cent higher now than when she had a protective tariff."
As labor-saving machinery increases an multiplies the power of labor to produce, it is but natural that the laborer himself should reap some of the benefits too, and be able, with the same efforts, to supply himself with more
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of the comforts of life to-day than he could one hundred or even twenty years ago.Exactly what this increase would be we cannot estimate, but the unsuppressed law of supply and demand, or, in other words, free trade, would not only figure it out, but give it to him. Besides, the abolition, since the war, of competing home slave-labor is another incalculable item in raising wages. And if the abolition of slavery has not brought us many of the benefits now attributed to protection, then it has failed to confirm the prophecies made for that cause.
But in going a century back to show low wages under low tariff, protectionists defeat their own intention, for there were then no steamboats, railroads, or national banks, and the lack of transportation facilities, together with our inferior "shin-plaster" currency and "wild-cat banks," pirates on the high seas, and many other inconveniences, afforded in many cases a more complete barrier to trade than does even our present protective tariff to-day. But they would, if in their power, sweep away from us all the rich blessings which the busy brain and the cunning hand of man have wrought, and these, new, rapid, and cheap modes of transportation have brought us, and take us centuries back, to the dark ages, and build a Chinese wall of protection or non-intercourse around us, that
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our laborers might receive such wages as a precisely similar course has established in China -- namely, a few cents a day. Thus protection, so far from being the American system, as they claim, is positively the rejuvenated old Chinese system of non-intercourse.Protection, they assert, is solely for the laboring man; but why is it that the protected manufacturer who imported contract labor from abroad until a law forbidding it became necessary, and which law he even now is sometimes caught violating, is the very one who interests himself most in getting protection and obstructing all legislation that opposes it?
The labor, skill, and muscle belong to the laborer, the goods to the manufacturer. The former gets no protection, for as much foreign labor as chooses can come unrestricted into the country to compete with our labor; but the minute the labor belonging to the workman is transformed into the article belonging to the capitalist, and has thus changed ownership, then, but not till then, does protection begin to operate.
The tariff, therefore, does not protect the laborer; for while it restricts only the importation of foreign goods, it does not restrict the importation of foreign labor, which competes directly with our American workmen, thus subjecting
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their wages to be regulated by the otherwise universal law of supply and demand, which law the protected manufacturers evade by seeking and receiving a protection therefrom of an average of 47 per cent over and above the price that law would set. And they force all-indiscriminately, including even their own employés, to pay them this tribute when buying any of their goods. Besides, it allows the foreign manufacturer to come here, erect mills, and, while paying his workmen starvation wages, reap a rich harvest through the extortionate prices our protective tariff enables him to collect from the American consumers of his products, and then carry this charity money home to his native country, to be there spent, enjoyed, and put in circulation. But how comes it that these very manufacturers who make such poor mouths when asking for protection, yet have so much money to spend in lobbying and in flooding the country with their doctored statistics and protection sophistry? And if they so love the poor laborer, why do they precipitate strikes and lockouts rather than pay him a few cents more per day. And why do they protest against having his taxes reduced and thus relieve him of an unnecessary burden?It is asserted that because our wages are high we need protection against the low wages
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of Europe. And yet in Europe, where wages are low, they want protection against our high wages. Germany, Italy, and Russia, for instance, whose wages are low, want protection against free-trade England's higher wages.And if free trade forces wages in the country that adopts it down to the level of those outside, as protectionists assert, then why does not free trade in England reduce her higher wages to the lower level of those in protected Germany, Italy, and Russia, her immediate neighbors?
Here, as elsewhere, the truth is revealed that the bulk of protectionist arguments consists of barefaced assertions, utterly devoid of either facts, proof, or reason.
With free raw materials, wages would go higher rather than lower, because the cheaper the materials the cheaper can the goods be made; the cheaper the goods the farther and wider can they be sold, and the greater the demand for them; the greater the demand for goods the more hands we must employ to make them; and the more need of and inquiry for laborers the higher will wages go. As Henry George tersely puts it: "When you see two workmen after one boss, wages are low; when you see two bosses after one workman, wages are high."
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Chapter VII. Enriching a Nation by Protection.
PROTECTIONISTS declare that it makes a nation richer and more prosperous to have a high protective tariff. Even were this false assertion true it would be no just defence of protection, for before the war many argued that slavery made the country richer than without it, because, said they, if the slaves are free they will not work as much as under the lash, and consequently not produce as much, etc.
But it was a question, not of the Nation's riches, but of slave and master, of justice or injustice; and as the lesser consideration must always give way to the greater, so it was in this case: justice finally triumphed, the slaves were freed, and renewed and redoubled prosperity followed; for when justice is done, prosperity follows as naturally as the shadow accompanies the substance.
So this, too, is a question of national justice, and one class should not be legally enslaved and robbed for the benefit of another.
Suppose it were argued that the poor laboring people, both white and black, were too indolent
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and extravagant, and that if enslaved, as were the negroes, they could, under the lash, be driven to work harder, produce more goods and wealth, and consequently enrich the Nation more rapidly: would you then advocate making slaves of them, simply to enrich the Nation?No, no; you would say it is unjust, and justice goes before all. Justice first and national wealth afterward. Let justice be done though the heavens fall.
This, therefore, being a question of justice or injustice, justice should be done without regard to consequence. And as protection supports the protected -- a class of people in a business which they acknowledge does not afford them living wages, by taxing for their support the unprotected -- another class of laborers who compete in their own line of business directly against the lowest-priced labor in the market of the world, as does the farmer, for example -- there is just the same sort of injustice done thereby as when a body of aristocracy are supported by taxing the common people, of which principle it is only a modified or disguised form.
By the last census it appears that less than 3,000,000 of the entire 17,392,099 of our industrial population are engaged in actual mining and manufacturing, the only lines of business that it is claimed receive the direct benefits of
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protection. It is evident, therefore, that, on an average, only one out of half-a-dozen laborers receives any protection, and that the other five must pay out what the one receives.Now, protection, to be just, if given at all, should be given equally to every business; which is not the case, thereby again proving it unjust.
And, even if that could be and were done, it would only be similar to reducing all our weights and measures to half their present size and yet still calling them whole measures and paying for them as such; or to using paper money to the exclusion of specie and yet transacting all business on a specie basis, reckoning each paper dollar as worth only half as much as a specie dollar, as was the case during the late war. In fact, a depreciated national currency acts on precisely the same principle as a protective tariff, only it is just to all alike, and gives no one business any advantage over another.
This protection theory is, therefore, not as honest as the green-back theory, because it discriminates unjustly against some avocations in favor of others.
These several incontrovertible points, proving its unjustness, should alone earn for protection the hearty condemnation of every honest
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man, and forever settle the question in his mind, and his attitude on it.But even a tariff law imposing a uniform rate of duty on all commodities would fail to give justice, as some articles, even without any tariff, are never imported to conflict with similar goods here, and consequently, on such articles, if the tariff were raised to a thousand-fold its present rate, it would not alter the price here one penny.
Agricultural products, which since 1830 have constituted an average of three-fourths of all our exports, belong to this class. To hoodwink the farmer into believing that he too is protected, a duty of 20 cents per bushel has been placed on wheat, of which product -- including flour -- we export 40 per cent of all we produce, and never import for home consumption a single dollar's worth, because the English wheat market is always higher than ours, and, as every seller seeks the highest market, none would seek our lower one, even if we had no tariff on wheat.
Immense valves, so placed as to keep the Mississippi River from flowing back from the Gulf up hill to its source, would be about as, necessary and sensible as this 20 cents per bushel is to keep foreign wheat products from coming here to compete with us in our home market, when we must ship 40 per cent of
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our own three thousand miles to find a market for it.Whenever the surplus of any commodity on our open market is carried to a foreign one, the price here must invariably be already lower than there, else there would be no margin for profit to exporters in handling it. Consequently, any tariff we might place on such an article, no matter how high the rate, would not affect its home price one iota.
As naturally as water flows from hill-top to vale, so merchandise flows from low to higher markets, thereby leaving a margin of profit to each handler. A reversal of this order would entail a loss on each handler.
Consequently it is only such goods whose market price at home is lower than abroad that can be exported.
A protective tariff can influence only the home market; consequently none of our exported goods get any benefit of a protected home market, as the slightest advance in the home market above the foreign immediately prohibits exportation. Hence all our exports, which alone counteract the outflow of our money, are entirely unprotected and get no benefit whatever, even at home, of any tariff law that could be passed, unless they availed themselves of the opportunity that law afforded
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to form a trust, combine, or monopoly to restrict home competition, and then charge home consumers more than foreign ones -- an act of which none but protected monopolists would be, guilty.It is a fact, to their shame be it said, that some of our protected manufacturers, while shamming patriotism, actually sell their goods, such as sewing-machines, etc., cheaper abroad than at home.
Therefore, as all our exports are not only unprotected, but actually burdened and fettered by protection, no thanks can possibly be due to protection for the balance of trade in our favor, though the cheeky protectionists are ready to arrogate to themselves and their Chinese theory this item of credit also.
Even if the duty on wool (another way of "pulling the wool over the farmers' eyes" should slightly benefit the wool-grower, there are but few farmers who raise sheep, and fewer still who raise them in such large quantities as to recover thereby, on that one article, the amount they lose through paying out tribute on the thousands of protected articles they need and buy.
But that a protective tariff fails to benefit the wool-grower is proven by the fact that statistics show that American wool has invariably
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brought a higher price under low than under high tariffs on wool.The reason for this lies in the fact that to successfully manufacture woollen goods requires a liberal admixture of every class of wool, and as we cannot possibly produce every grade of wool in America, the more foreign wool we import the more American wool do we need to mix with it. And in proportion as foreign wool is shut out it becomes impossible to use American wool in our manufactures, and thus, by the limited demand for home-raised wool, its price is depressed.
Likewise is the farmer left unprotected in beef, corn, cotton, and nearly all else he produces, and yet must compete in the market of the world with even the lowest class of this much-feared "foreign pauper labor" -- the Russian peasant and the Indian ryot.
Not only this, but he is also handicapped with paying an average extra 47 per cent above what those competing paupers pay, for nearly every protected article he needs.
He is yet furthermore persecuted by the retaliatory tariffs of foreign nations against his products, imposed because of our tariff on some of their goods, constituting thereby a twofold burden, as in the case of Germany's tariff on American pork.
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Thus this principle of protection causes us to mistreat our best customers, for we thereby say to them as foreign nations, "Though you buy our goods and pay us the world's highest market value for them, yet we do not want any of your goods unless you let us have them for 47 per cent less than we can make them ourselves."
By this course, instead of fostering trade as we should, we have provoked retaliatory legislation against some of our products. England buys 31 per cent of all our exports, -- that is, over half of all we send away, -- and yet our protectionist brethren are constantly railing against free-trade England, our best customer. For the protective tariff law was designed by its compilers to enable the home producers to enhance the price of their product to home consumers a per cent above the world's competing prices equal to the tariff rate, and still leave the domestic article as much cheaper to the consumer than the imported one as the freight charges for importing the latter. And in most cases it accomplishes this result. In every instance where it fails to do so, either the alleged intent of the law fails, or else the tariff becomes prohibitory, resulting in no U. S. revenue, but existing in such cases solely for protection; for if domestic goods are cheaper than precisely similar foreign ones can be sold
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for here after adding the tariff and freight expenses, then everybody buys domestic goods, and no foreign ones are imported, and consequently no tariff from them is paid into the U. S. treasury.Another dodge to get the unprotected farmer to look another way while the protected monopolist is putting his hand into "old hayseed's" pocket for that extra 47 per cent he calls protection, is to point him to the "home market." But a home market wherein all his principal products sell at foreign market prices,, minus the freight thereto, while nearly all of the protected manufacturer's goods he needs to buy sell at foreign market prices, plus the freight therefrom, plus also the manufacturer's 47 per cent protection, is not a very inviting, picture for the farmer to contemplate.
With the exception of its sweet-sounding-title, a "home market" purchased by such a sacrifice has no charms for the intelligent farmer.
As for free trade causing the mechanics in protected factories to become competing producers of agricultural products instead of consumers, it were better far that they were honest producers than pensioned consumers, as they virtually are when supported by protection. Besides, it requires just as many men to produce the manufactured goods of the world if
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made abroad as if made here, and just as much food to support them in either case; so it would not affect the world's number of consumers one iota if all our protected factories were closed.And as the farmer gets the same price for his staples that are shipped abroad as for those that are sold at home, it matters little to him financially where the consumers live. In fact, it were really better for the farmer that they lived abroad if he thereby escaped paying them a pension, disguised under the name of protection.
Chapter VIII. Effect of Protection on our Foreign Trade.
BUT, to show the utter fallacy of protective arguments, we will investigate the assertion that protection enriches a nation. By way of illustration, let us suppose it were possible for New York City to adopt a tariff of her own, doubling the price of everything landed on Manhattan Island. The day such a law went into effect every merchant in New York possessing goods would find them doubled in
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price, and consequently he would feel himself twice as rich as the day before, because to get the same stock in his store would now cost double the money these had cost him. The same would be the case with every other branch of business in New York.People becoming so suddenly rich are apt to be free with their money, and no doubt money would circulate freely, and there would be booming times in New York City for a little while. Such times, you remember, came after our present high tariff first went into effect, during the late war. But there came a day of reckoning; and so it would for New York City. People outside the city would say, "Don't go to New York City to buy your goods, for they have a tariff over there that doubles the price of all the goods they handle, and you can buy for about half New York prices anywhere else." The truth of this would soon be demonstrated to all practical buyers, and New York City would experience such a severe boycott, of her own making, as, you will acknowledge, would cause the grass to grow on her streets in less than a year. Even should New Yorkers agree to pay the freight on all goods bought of them, it still would not revive business, for it still would not reduce their goods to the price of those outside.
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Enlarge the territory and take in the whole State of New York under the law, and, being larger, she will boom longer, and can stand the boycott longer, but must feel it soon too, as she would need many things not produced within her borders, for which there would be a constant outflow of money, retarded only by the income from the sale abroad of such goods as she could sell there as cheap and in direct competition with all her neighbors. You must admit that such a tariff would injure New York State.
Again enlarge the field and include all the Eastern States under the law, and, though the result will be longer delayed, yet it will be the same eventually. And when we enlarge the field still more and take in the whole United States, we see she has stood it over a quarter of a century; but the inevitable reaction is upon her, and her sufferings are becoming greater and greater every year.
Even were we to have subsidized steamships, as advocated by some, to carry our high-tariffed goods free of transportation charges to other nations, we still could not sell them there, for they can buy similar goods so cheap elsewhere that even after paying the freight themselves, the other goods are still cheaper to them than ours would be with freight prepaid.
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Notwithstanding our bountiful resources and the industry, ingenuity, and thrift of our population -- a population nearly double that of Great Britain -- we are content to stand idly by and see her trading amount to twice ours; which means that, on an average, each Englishman handles four times the trade of each American, notwithstanding all our boasted Yankee shrewdness, our natural resources, our blessed republic, with this blessed (?) protective system.
Let us see what effect this law has on our export trade. As an expressman or teamster who hauls goods at a certain rate per hundred pounds per mile prefers getting a full load at one place to running around gathering it up piece by piece here and there, so a shipmaster, for similar reasons, prefers to get a full load in one port rather than gather up a load piecemeal here and there -- like a tramp vessel -- by getting one part here, another in Germany, another in Italy, Russia, China, etc.
Consequently, the port where all or most of the goods can be bought cheapest is the one most vessels and buyers go to; and frequently some other goods, selling even higher than elsewhere, but not enough higher to justify going elsewhere after them, are bought in the same port.
Now, the English merchant who buys shiploads
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of goods in Germany, Russia, China, Spain, and in fact all over the world, can bring them home, and, if he sells for $1.10 what cost him $1, he gains 10 per cent.But the American merchant, after paying an average duty of 47 per cent to land his goods at home, must sell those identical goods at $1.60 to gain 10 per cent on his investment. Even should he be able to avail himself of a "drawback" on what portion of these goods he exported, he would have to sell at $1.21 what the English merchant can sell at $1.10 in order to make the same per cent of profit on his investment as the Englishman makes, besides the extra trouble even that the tariff drawback makes.
Thus, you see, our protective tariff places the American merchant and exporter at a great disadvantage, while the free-trade English merchant has an inestimable advantage over both him and the merchants of all other nations that are shackled by protective tariffs. And in this fact lies the secret of England's vast shipping interests, immense manufactures, and commercial supremacy.
Though we can and do sell some manufactures as cheap as England, yet this great excess of price on most other things causes foreign buyers to shun our market and enter one where
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they can pick up all they need -- a ship-load -- at the lowest market price.Even unprotected articles are so enhanced in price by the cost of the protected raw materials entering into their manufacture, that they are thereby made too high in price to successfully compete in foreign markets with similar goods made where such restrictive laws are unknown. Thus in many ways is our export trade, through protection, restricted and hampered.
But protectionists defiantly say that we should raise the tariff until it becomes prohibitory, so that nothing is imported; that we need no foreign trade; that we can manufacture all the goods we need ourselves, -- and hurrah for this rejuvenated Chinese system of non-intercourse under the misnomer of the American system of protection.
To blockade the enemy's ports and cut off all his commercial intercourse with the rest of the world is considered a very desirable, effective, and subjugating war-measure. Yet the very height of the protectionists' ambition is to secure for our country a self-inflicted blockade, by means of a high protective or prohibitory tariff, which, they aver, is absolutely the shortest and only road to national prosperity.
So anxious, however, were our forefathers for foreign trade, that when, in 1801, Louisiana was ceded by Spain to France, by whom the
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port of New Orleans was closed to our commerce, some American statesmen thought that act sufficient cause for war. In 1803 Louisiana was purchased from France for $15,000,000, thus forever settling the question. The war-cry of 1812 was, "Free trade and sailors' rights."In 1852 the United States sent a fleet and forced the Japanese to open their ports to the world's commerce.
Should these heathens to-day prepare to give us a dose of our own medicine by coming with a fleet to enforce their demand that we practise the American policy taught them in 1852, what Christian-like answer could we make them?
Chapter IX. Our Infant Industries -- "America Too Young for Free Trade."
THEY want protection, as they claim, for our infant industries, and the inference drawn therefrom is that these industries shall not always be infants and need protection, but shall some day be self-supporting, for all infants are supposed to some day grow to maturity.
This was, in fact, the first and only plea on which protection was asked and obtained. But
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when shall that day of maturity arrive? Shall it be the next decade, the next century, or the next thousand years?None of these protected infant industries have as yet outgrown their swaddling-clothes and become self-supporting, as protectionists claimed they eventually would.
The oldest of these superannuated infants are already nearly one hundred years old, and still have their mouths to the protection sucking-bottle. And, what is worse, like spoiled infants, the older they grow, the more tariff-nursing they demand and the harder they are to wean. Is it not about time to wean them, which we shall never succeed in doing if their wish alone is consulted?
And should we not be ashamed of the cry that we are too young to compete with other nations, when little England, with her huddled population, only about half as great as ours, does, under free trade, twice as much trading as we do under protection? And that, too, while crowded with an average of twenty people to the square mile where we have one.
Imagine our situation with twenty men for every job where we now have one.
At the time England adopted free trade, she, of course, was not too young, as her success indisputably proves.
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But if we are yet too young, as protectionists declare, then they must admit that, with twenty-five years of this glorious protection to their heart's desire, we are yet farther behind than England was forty-two years ago when she successfully adopted free trade.
Quite a humiliating admission, this, indeed!
The iron industry, which has been protected so many years, now asks a larger percentage of protection than it did years ago; and the same is true of almost the entire list of protected industries.
It seems that protected industries, like armored ships, require year after year ever thicker and thicker plating, as the artillery of competition is perfected.
And as this very cry of being too young to compete carries with it the implied concession that we shall some day be old and strong enough not to need protection, how then can protectionists claim the exclusive prerogative of judging when we are old enough? For when a protectionist once admits that protection is no longer needed, then he is no longer a protectionist either, and thus protection once given could never be abated or abolished until every last protectionist consented, if none but protectionists are to have any say on the subject.
May we not, however, also have some right
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to an opinion on this matter? If so, then, in our judgment, the time for a change has arrived -- aye, even long ere this. When shall we be abler to compete with the world by following our present policy? England's shipping increases every year. Ours has decreased until, alas! it can decrease no more.Even in 1754 the shipping of New England alone consisted of over a thousand sails, exclusive of fishing craft, which were numerous. With such headway over a hundred and thirty years ago, what ought we be to-day? Can we learn from neither example nor experience? Is it not high time we learn the lesson taught by both, as its sadness grows apace?
If free trade kills manufacturing and commerce, as protectionists assert, then why is England the greatest manufacturing and trading nation on the globe?
And if protection is such an advantage and free trade such a disadvantage and burden to a nation, then why is it that they threaten that if we lower our tariff England will do this, that, and the other to our detriment? Why are they so afraid of the English manufacturers?
England has had free trade for forty-two years, and if, as protectionists declare, free trade "kills" manufacturers, then all her factories are not only "killed" but actually petrified, and we
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have nothing whatever to fear from her. But why are they not so afraid of Germany, France, Italy, Russia, and the rest of the protected nations of Europe?If protection gives such superior manufacturing and commercial advantages, then is it not these protected nations instead of free-trade England that we must fear? Oh no: it is England, and England alone, whose trade is so powerful, and she alone whose commerce we so much dread.
This fact alone should lead the blind protectionists to find the acorn of truth, namely, that if free trade has made the commerce of little England so great that all the world must commercially fear her, a little of the same diet will doubtless be good for us. And the sooner we imitate England's example in this, the sooner will we rival her in trade and make some of the world commercially fear us.
Are our manufacturers and workmen not so shrewd and industrious as the English, Germans, Italians, and other Europeans, or why must we fear competition?
In spite of the fact that we have citizens here of every nationality, speaking every language and dialect of their former homes, where they have friends and relatives and everything calculated to foster friendly relations and consequent
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trade with those nations, yet we are far behind England in trade.Then, too, these diversified nationalities of mechanics bring with them each their home methods and ideas there practised in their respective trades, and the foreman here selects the best of these methods, thus giving us superior methods, machinery, and results, which accounts to a great extent for our world-famed Yankee inventiveness.
But our protected manufacturers claim that monopoly, and monopoly alone, keeps their business alive, the old adage that "competition is the life of trade" to the contrary notwithstanding.
The truth, however, is that free trade neither kills nor hurts any honest self-supporting business, and not one avocation in the United States out of twenty would be exterminated by it, though some might be thereby deprived of the exorbitant profits they now shear from their unprotected customers under license of protection: and therein lies all the cause of their alarm and clamor.
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Chapter X. Capital and Labor Diverted from Their Proper Channels by Protection, Etc.
ANOTHER fault of protection is that both capital and labor are thereby tempted and diverted from proper, useful, and self-supporting channels, such as the unobstructed law of supply and demand would indicate, into lines of business which are confessedly non-compensating, impoverishing, and bankrupting, unless a subsidy or perquisite can be extorted from the consumer for the benefit of the producer, through license of a protective tariff law.
Everyman employed by protection-made and consequently eleemosynary wages is kept from lending his skill and muscle to a business wherein he would actually earn what wages he received, and is thus kept in the humiliating, beggarly state in which he must acknowledge he receives more wages than he earns, for otherwise he would be receiving no benefit of protection.
Every dollar of the accumulated surplus is so much subtracted from the business enterprises of the Nation, and every dollar absorbed
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into protection-needing and consequently un-paying, non-self-supporting business is so much withdrawn from the healthy, self-supporting, wealth-increasing business of the country, thus fostering corruption at the expense of honesty, indigence at the expense of honest industry and thrift, monopoly at the expense of healthy, honest competition, and thereby contracting the currency and inviting business panics.It also instils into our people a false theory of economy and prosperity, for by it they are taught to believe that the higher the prices they pay for their necessaries, and the more extravagant they are with their money, the more prosperous the Nation, and themselves individually, will become.
This heroic homœopathic treatment may be all good enough in the eyes of its patrons, but we are not all homœopathists, and many of us stubbornly refuse to believe that what causes bankruptcy will also cure it.
As an excuse for extorting this protection money from unprotected buyers, it is claimed that the money of which they are thus robbed comes back to them again; but the protectionists have signally failed to show how, when, and where. And besides, why should they take it from you only to give it back again?
Their reasoning, that giving away your
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money to have it given right back again to you produces national prosperity and at the same time enriches yourself too, sounds more like the argument of bunco-steerers than of wise and patriotic statesmen, and is likely to be believed only by such as would fall easy victims to the wiles of that sportive gentry.And besides, why should you give away your money that you may have it given back to you again in return only for services for which they acknowledge you must otherwise have gone unpaid?
However, a large majority of protectionists fail to practise what they preach, as in buying their labor they are willing to precipitate a strike or lock-out rather than concede a few cents per day in wages to their employés. And in all their other purchases they usually drive an equally close bargain.
To aid consistent protectionists in themselves practising their preachings, a law should be enacted stamping or branding all American goods "American," and forbidding any foreign goods to bear that stamp under heavy penalties, thus enabling the misguided protectionists to select American goods, even at double prices if they choose. But protectionists should be charitable enough not to want to make others suffer along with them for their delusion, but
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should be willing to accord sensible people the right to select the goods that give them the greatest returns for the money, be they domestic or foreign, without charging an average of 47 per cent for the privilege of taking your choice.One great obstacle in procuring tariff reform is that it is an indirect tax, which, like a fatal chronic disease, unseen, and so insidiously as to seldom excite attention, gnaws continuously at our purse, and thus unheeded pursues its demoralizing way.
An awakening to the true nature, effect, and final result could be greatly accelerated by requiring stamps representing the equivalent of the imposed duty to be placed on each tariffed article or its wrapper, and compelled to remain there until it passed finally into the consumer's hands, similar to the internal stamps on cigars. By saving and adding together at the end of a year the cancelled stamps, each man could estimate precisely how much tariff he yearly paid for revenue. And by having similar domestic stamps, which the government might furnish to the laborer, to be sold by him to manufacturers along with his labor, and then affixed to the goods he made, the amount paid for protection could easily be reckoned also, and each protected laborer could thus reckon how much protection he received and how much he paid
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out in a year, as well as how much actual wages he earned and received, and how much of his living depended on charity.Another difficulty in the road to tariff reform is that protected monopolists, having large sums at stake, are ever willing to pay liberally to lobbyists, newspapers, and others to advocate their cause, while on the side of tariff reform and justice the laborers' efforts are without any hope of reward other than that of an approving conscience.
Knowing the unjust basis of their license to extort protected prices from the people, protected avocations are always in a flutter when Congress meets or a national election is pending, fearing lest they lose part or all of this unjust bonus, thus paralyzing business, so far as they are concerned; and protected industries alone are instrumental in causing the unusual depression of Presidential-campaign years, for no other business depends upon or is in anyway influenced by political manipulations.
The prosperity of unprotected industries is based on brains and industry; that of protected avocations relies on the coddling care of the government. Abolition of protection, therefore, means abolition of Presidential-year business depressions.
As it is easier to inundate a mill-pond than
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the ocean, so likewise is it easier by overproduction to glut the home than the world's market; and when we shall have once sundered the apron-string of protection and launched boldly out on the sea of the world's commerce, we shall hear no more of overproduction, and its attendant half-time, strikes, and lock-outs, which mean so much misery and distress for the poor laborers.During the past twenty-five years of high protective tariffs we have, by that system, made more millionaires, more paupers, and more tramps than were ever before made in a civilized nation in so short a time.
Even England, with her old hereditary law of giving all the father's property to the eldest son and the other children nothing, which is naturally calculated to cause extremes of wealth and poverty, cannot equal our record in this. And while the protected manufacturer has millions, what has the laborer after a lifetime of toil to show at the end thereof as his share of this protection?
While capital reaps an enormous bounty, labor is shorn of its just dues, and in decrepit old sge receives in the alms-house ofttimes the only protection ever granted it that the capitalist failed to first get his hands on, skim off the cream, and get the lion's share thereof.
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Chapter XI. The Laws of Commerce and Trade; Their Effects and Benefits.
LABOR, the origin and basis of all wealth, is the true and only measure of its value.
Wealth consists in the possession of the fruits of labor.
Possession is gained by inheritance, gift, conquest, producing, manufacturing, and exchanging.
The last three are the methods usually designated as business, commerce, or trade, and are the principal and almost the only methods of obtaining and increasing private, corporate, and national wealth.
Money is the tangible representative of value, the yard-stick of labor, the medium of exchange, by which the fruits of labor are estimated -- the means by which we calculate how much labor of one kind is to be given for so much of another.
Consequently the recompense of labor depends not only on the number of dollars received, but equally as much on the amount of comfort those dollars will buy.
In the country where one dollar will buy
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twice as much as elsewhere, ten dollars wages per week are as good pay to the laborer as twenty dollars per week are elsewhere.So a reduced cost of the necessaries of life actually means a virtual increase in his wages. "A dollar saved is a dollar made."
All buying and selling is simply exchange of the fruits of labor, money being the basis of calculation, or the measure by which the value or amount of those fruits is estimated.
As the thermometer and barometer measure the heat and air-pressure, so price, when unobstructed by protection, blockade, or siege, measures and indicates the equilibrium between the exertions needed to produce the different articles of the world's traffic, modified only by the differential rate of wages in the various trades or degrees of skilled and unskilled labor; a certain amount of labor of one class being exchanged for an equal amount of another class in buying and selling, money simply being the representative of value.
Thus, on a market undisturbed by protection, the price of an article indicates a compromise between the world's demand for it and the time, trouble, and labor consumed in making or producing it or some other article traded for it. Protection subverts all this.
If you exchange an article which cost you a
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certain amount of labor to produce it for one which would cost you less to produce than the first, then you lose the difference of labor in the two articles by the exchange.But if you exchange an article that cost you less for one that would cost you more labor to produce it, then you gain the difference of labor by the trade.
Suppose A, by reason of his skill, can make in one day an article that it would take B, because of his lack of skill in that line, three days to make, and that B also can make in one day an article that it would take A three days to make. Each one wants the article the other makes; so they make an even exchange, thereby making a gain or saving of two days' labor for each. This is Free Trade pure and simple.
Every sale means an exchange or trade in which both parties have received something they each desired more than the article they gave in exchange; whether or not money was used in the transaction makes no difference. For even when you pay out money, you get in exchange for it something you would rather have than the money, else you would not make the exchange.
So every sale means an advantage or gain to both parties concerned in the transaction.
Any article you can buy cheaper than make
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is one you can obtain by exchanging therefor another article costing you less labor to produce than would the bought article were you to make it yourself.If this is true of individuals, it is also true of nations; and as any law which allows of free-trade or exchange between individuals is beneficial mutually to those individuals, and every law which restricts or hinders this free trade is detrimental to both, so any national law which allows of free mutual exchange between nations is beneficial mutually both to those nations and their individual constituents, and any restrictive law, such as our protective tariff law, is proportionally detrimental to both.
Owing to a diversity of trades, and the perfection and skill a lifetime of practice at one line or branch of trade gives, and to diversity of natural advantages, -- location, climate, mineral deposits, etc., etc., -- nearly all trading, whether individual, domestic, or foreign, results in advantages to both parties concerned in the transaction, by exchanging and obtaining thereby what would have cost each party more labor to produce than did the article given in exchange. And when the advantage is not mutual an exchange is seldom or never effected.
As labor-saving machinery operates to give the toiler more fruits and larger returns for a
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given amount of labor, so unrestricted or free trade operates similarly to give him, by exchange, what to him are more coveted and more valuable returns than the product he himself makes, else he would not trade; and if free trade is injurious to the laborer and the nation, so likewise must labor-saving machinery be injurious to them both.Thus it is seen that wealth -- both individual and national -- can be accumulated by trade or exchange as easily and rapidly as by labor itself, if indeed not more so; and the wider the field of competition the greater the stock of exchangeable goods to select from, and the better recompense the laborer is likely to get in exchange for his product. All labor is finally paid for in the market where its product is sold, and the more this market is restricted the less demand will there be both for the goods and for the labor that produces them, and the less wages will it consequently receive, and vice versa.
Consequently all those American laborers who produce our exports are working at foreign wages. Protectionists insist on American wages for American workingmen; and if their theory were to be carried out, these men who produce our exports would be compelled to stop work in that line, and then be driven into competition
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with the laborers in other lines, thus reducing their wages until they would be similar to the Chinese, who believe in Chinese wages for Chinese workingmen.Imagine the effect on the wages of New York's laborers if the law were so arranged as to prohibit the sale of their products outside the city limits.
In trade or exchange there are always two parties to the transaction, a buyer and a seller, and they each should have the unrestricted right to trade where and with whom they please, so long as the goods and money they exchange represent their own labor; and naturally and instinctively each one seeks the market where he can get the greatest return for his labor, goods, or money, thereby insuring every foreign deal or trade he makes to bring some gain to both himself and the nation he represents.
The right of men to trade or exchange with each other the fruits of their labor is as sacred, God-given, and inalienable as the right to labor itself; and all laws restrictive of that privilege, no matter under what sweet-sounding misnomer they come, are but so many stealthy, traitorous blows at Liberty herself -- so many enslaving chains, silken-covered and disguised
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though they be by the alluring name of "protection."We deny the right of any party or government to interfere with or restrict this right; and, call it Free Trade, Commercial Liberty, or what you will, the right exists the same, and will not tamely submit to be throttled by the enemy, even though he come clothed in the seductive guise of "protection."
It pays a carpenter better to work at his own trade, earning $3 per day, and trade his dollars to the tailor, who also earns $3 per day, for a suit of clothing, than to lose his own day's wages by working at the suit himself; for, not being an expert at tailoring, he could not do half as much in a day as a tailor, and that half not as well; and consequently, while he would be saving the $3 tailor-fee, he would lose two days' carpenter-work, worth to him $6, a clear loss to him of $3 for his false economy.
Likewise, when the American workman who earns $2 per day is allowed to freely trade the product of his labor for tea, etc., to the Chinaman, who earns only 10 cents per day, he gets 20 days' work from the Chinee in return for his one day's work. But if we put this same American workman at raising tea, then the product of his day's work will actually be worth only 10 cents, and we must tax ourselves
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on the price of tea to give him whatever wages he receives above that sum.And the only way we can get the intelligent American to make here the unpaying articles that paupers make abroad, and thus bring him into actual direct competition with this foreign pauper labor in a line of business where it is otherwise impossible to compete, is by "protecting" him into it.
As each individual, by selecting a trade which alone he follows for a lifetime, through so many years of experience develops a perfection unattainable by the "jack-of-all-trades," so national advantages and interests in certain lines bring them also to superior perfection.
So, when nations, by means of certain natural advantages, can produce certain articles cheaper than their neighbors, it pays them all to exchange the articles each can produce easiest and cheapest for the articles the others can produce with least expense and exertion, thus making an actual gain of money, time, convenience, and comfort for each party to the transaction. And free trade points out precisely what those articles are by making them the staples of exchange.
In fact, this very law of exchange is the law of God, doubtless by him so designed and intended to keep men and nations thus sociably
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interchanging the products of their soil, mines, hands, and brain, thereby civilizing, educating, and refining each other by the mutual interchange of thought, crystallized, as it were, in the perfect, finished tool, machine, garment, book, or painting. Else why should he have given each zone its own peculiar vegetation, fruits, animals, fowls, fish, and furs, each nation, nay, each hill-top, its own peculiar soil and minerals, strewing iron, tin, lead, oil, coal, natural gas, etc., each in different localities? Why this distribution but to tempt thereby the interchange of labor's fruits, through which the accompanying results of civilization, enlightenment, and refinement flow, thereby penetrating and permeating the remotest parts of the earth?Free trade is, therefore, the natural order of things, -- the law of God, unrestricted, free, and just, neither oppressing nor blighting, but blessing with peace, prosperity, and plenty the nation whose people practise it.
Protection is the artificial, restrictive, sectional, selfish, unjust, and injurious law, not even of man, but of a few scheming demagogues and monopolists, coming under a sweet-sounding misnomer, as the wolf in sheep's clothing, as the thief at night, as the traitorous spy in the camp, to rob the poor and needy of the hard-earned fruits of their labor, by denying
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them the God-given right to exchange those fruits, without a penalty, where they can get the greatest returns.As before shown, free trade benefits mutually both individuals and both nations that are parties to the trade; and that philanthropy is indeed narrow which is hemmed in by state lines and cannot double its rejoicing because of the twofold blessing thus bestowed.
And as free trade is the natural order of things, the burden of proof lies with the protectionists to show that they have a better law than the Almighty, an improvement on the natural order of things and the law of nature.
Protectionists seem to have gorged themselves not only with subsidy or charity money, but with apocryphal literature as well. They have figured so much on the ignorance and credulity of their following, and their ability to bluff and deceive, that they have the audacity to assert that not we, but foreigners, pay our tariff tax. To heighten this delusion they are pleased to define a protective tariff as "a toll paid by foreigners for the privilege of entering our market."
Now, if American consumers do not have to pay this "toll" themselves in the increased cost of the foreign article, then why do they call it a "protective" tariff, and how does it
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"protect" the home manufacturer if it does not advance the cost of the competing foreign article?They, of course, mean to say that foreign goods do not cost us any more by having a high protective duty on them than they would if we had none, for otherwise we are paying the tariff duty in the increased cost to us of those goods. Now, if the tariff does not increase the cost to us of the foreign goods, will they please explain how such a tariff protects any home manufacturers of similar articles?
And if the tariff tax is not finally paid by the consumer, then neither is our internal-revenue tax paid by him.
But by the reduced price of matches now, as compared with their price under internal-revenue tax, it is plainly seen that consumers, and they alone, finally pay all our national taxes.
Then, if we pay the tariff, why do they misrepresent this fact, as they do many others, and try to deceive and mislead the people?
As water seeks its level, so wages seek their level, and, unhindered by protection, indicate accurately by their height what business naturally enriches most rapidly the wage-earner, the employer, and the nation. The unrestricted natural order of supply and demand, or free trade, thus keeps men working
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at what the world most needs them for, and at what they therefore can actually earn the best wages, and consequently at what enriches the nation most and can be traded off to the best advantage in the world's markets.It is self-evident that, under this natural order, the labor and capital of the nation are thus directed into such channels as give the largest possible recompense, which is invariably commensurate with its actual worth to the employer, consequently it must invariably enrich the laborer, the employer, and the nation more rapidly than any other.
And yet a protective tariff entirely subverts this natural order by inducing laborers to work at the very things that do not pay, as their need of protection irrefutably indicates, and levies a tribute from healthy, honorable, self-supporting avocations to be used as a subsidy, perquisite, or charity gift in supporting sickly, pauper, parasite occupations, which, like leeches and beggarly vermin, subsist only on and at the expense of the former.
Imports come to us simply as payment for our exports, and, if we cease thus importing our pay, then we shall also be forced to cease exporting our products, which will throw out of employment all those now engaged in producing those exports.
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Chapter XII. How Protection Juggles with Values and Statistics.
PROTECTION juggles with values, making them appear what they are not. It puts a fictitious value on articles, the same as a depreciated currency during our late war made a set of prices here totally at variance with the prices in the world's market, and yet whenever we bought foreign goods we had to give gold or products at gold values in return for them.
A depreciated currency is a better protection than a protective tariff, for the former "protects" equally all occupations within the Nation's boundary, while the tariff protects only a favored few at the expense of the many, and there is more real honesty in the greenback theory than in tariff protection.
Protection has also caused our statistics to be misleading, as many things are thereby rated at an average of 47 per cent more than their true value, thus giving an apparent increase of 47 per cent to those products, which is not real, while it conceals a proportionate actual reduction in the purchasing power of wages. So,
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much of this apparent increase in wealth and wages to which protectionists so proudly point actually came in one day, -- the day the protective tariff law went into effect and a new rating of values on protected goods was thus established. It therefore came by fiat and not by protection, nor by genuine increase in value.Law, through limiting the supply, can increase the price of an article, but not its intrinsic worth; and when a price is thus increased by fiat, a nation is no richer in possession of the fiat-priced article than she was before. Would the nation and her people be any richer by putting a valuation on the free air we breathe than she is now without that valuation?
As labor is the equivalent of money, or actually the real thing of which money is simply the representative, -- the measure, -- the yardstick, it follows that when two dollars' worth of labor is expended in a mine in procuring one dollar's worth of ore, there is a clear loss to the operator of one-half his outlay on every dollar expended in this kind of mining.
But if the nation agrees to accept this dollar's worth of ore as though it were two dollars' worth, and pay for it as such, then the loss of the miner is simply shifted, and becomes that of the nation or consumer of the ore, and this loss follows the ore, and is as necessary a concomitant
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of its price as are its constituent elements a part of its composition.And at every sale of this ore or the article of which it forms a component part, this accompanying loss is simply shifted from seller to buyer, until it finally reaches the consumer's hands, who eventually must bear the loss. This loss can no more be eliminated or dropped (without a corresponding loss to the handler) than can one of the constituent elements of the ore be lost through trading.
And the compensating tariff rate in our tariff schedule is recorded evidence of the acknowledged fact that the framers of our tariff-schedule recognized the existence and truth of this principle.
Moreover, protection, by enhancing the price of all the articles it contaminates, reduces both the home consumption and the foreign exportation of all those articles, thereby restricting the need of and demand for labor, and consequently depressing wages, while at the same time saddling on the consumer the original loss of the protection-needing avocations.
A greater combination of wrongs and injustice it seems impossible to inflict by any other law than this unjust protective tariff.
To make an article which can be bought
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cheaper than made is not economy, it is extravagance.Suppose a manufacturer has capital enough to employ a hundred workmen in making a certain machine, on which his net profits are 20 per cent annually on his investment, by buying ready-made the bolts, screws, nails, and other iron work he needs. But were he to drop manufacturing his machines and put all his men at making these bolts, screws, nails, etc., to be sold on the open market, he would lose 10 per cent annually on his investment, because of his lack of machinery, capital, and "plant" to compete with other factories in that line. But by putting half his men at making these bolts, screws, nails, etc., and the other half at completing the machinery, his gain of 20 per cent on half his business is reduced 10 per cent by his loss on the other half, leaving thus a net annual gain of 10 per cent on half his capital and laborers, or a net gain on all of them of only 5 per cent.
Is it wise, therefore, for him to thus make his own iron work to save the outlay for it, when he could buy it cheaper than make it himself?
So if in any business establishment or family certain articles can be bought cheaper than made, is it policy, is it good business management, is it good common-sense, to make such
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articles in spite of this fact, and then take part of the profits of the good parts of the business to fill up the deficit of the losing parts?Likewise, is it good national policy for a nation to make what it can buy cheaper than make, and what it in fact could not otherwise afford to make, were it not for the extra price it saps from its consumer constituents through an extortionate tariff?
Yet this protective tariff forces us into this very position of making those very things which the law of supply and demand indicates can be bought cheaper than made.
According to the official report on commerce and navigation of the United States for the year 1887, our imports of iron and steel, and manufactures therefrom, were $50,618,985 worth, on which a duty of $20,713,234, equal to 40.92 per cent ad valorem, was paid. This means that 29 per cent of the price these goods sold for was either tariff tax or protection, and might have been itemized on the consumer's bill thus:
To 71 cents on the dollar for the goods | $71 00 |
To 29 cents on the dollar for protection | 29 00 |
Total | $100 00 |
From the official returns of the tenth census of the United States for the year 1880 we find that the value of iron and steel products was $335,900,000,
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for producing which, $62,700,000 was paid out in wages to 159,527 employés, equal to about 19 cents on every dollar's worth representing wages. Hence it is evident that in buying domestic steel, iron, and manufactures thereof, only 19 cents on every dollar's worth represented wages, while in buying similar foreign goods 29 cents on the dollar represented tariff duty. The quality and actual or intrinsic worth of these competing articles, as compared with their price to the consumer, must have been almost identical, else such large quantities of foreign goods could not find sale in competition with our domestic goods.Consequently it follows that it would have been cheaper to American consumers by 10 per cent to have bought all these goods abroad, if there had been no tariff, for 29 per cent less than they paid, and then have paid the American workmen their 19 per cent as wages, the same as if they had worked, though they sat around idle all year.
Another instance. In 1880 the value of domestic manufactures of woollen goods was $160,000,000, and the wages paid for their manufacture was $25,000,000, equal to about 16 per cent of their selling price.
The value of imported woollens for 1887 was $44,000,000, on which an average ad valorem
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duty of 67 per cent was paid, thus making the duty actually equal 40 per cent of the selling price. So, had there been no tariff, we might have let these hands lie idle the whole year, and by paying only 16 per cent tax on the foreign price of the goods have thus raised enough money to pay their entire year's wages, and yet have saved consumers 24 per cent of their purchase-money on all the domestic woollens they bought.This gives us an idea of what the enormous profits of protected manufacturers are, even above the legitimate profits of foreign manufacturers, who themselves pay the wages of their employés, while here the unprotected consumers pay all the workingmen's wages, and then make the woollen manufacturer a donation of 24 per cent over and above what it costs to manufacture the same goods abroad, besides also making him a present of the equivalent of the whole sum the foreign manufacturer pays both for wages and freight.
This is only one illustration of which the whole scheme of protection is a thousand-fold consummation.
The estimated annual product of our manufactures is now $7,000,000,000 worth, of which we export but $136,000,000 worth -- less than 2 per cent.
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Since 1860, that is, during the last 28 years, an average of 75 percent, or three fourths, of all our exports were agricultural products.
Were there no duty on any of the raw materials from which our manufactured products are made, many articles now made abroad would be made at home, thus giving more employment to our own labor, and a better market to many articles we produce which, like cotton, wool, flax, hemp, and others, enter into the manufactured product.
As to the method proposed to avoid a surplus by distributing it in the shape of pensions, we admit it is perfectly right and just that our veterans who so nobly, effectively, and unselfishly fought and bled for the preservation of this glorious Union should be well cared for. But they themselves are too patriotic to ask it, and it is in truth an insult to their patriotism to assert that they are willing that the widows and orphans of their still more unfortunate brethren in arms who died on the field of battle be taxed eternally for their benefit, while the rich are, to a great proportionate extent, exempt from such taxation. Besides, as these veteran pensioners die off, are we to substitute as pensioners in their stead all the mills and factories in the land by means of prohibitory tariffs?
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Chapter XIII. The Sinking Influence of Protection on Other Business.
WEBSTER declared that, "The great interests of this Nation are so united and inseparable that agriculture, commerce, and manufactures will prosper together or languish together. All legislation is dangerous which proposes to benefit one of these without looking to the consequences which may fall on the others."
By way of illustration, let our Nation's business be compared to a vast, irregular, undulating ice-floe or platform, covered with struggling humanity as it floats in the water. On this floe or platform it is desirable to carry as many people as possible. All self-supporting business we will suppose to be represented by that part above the water, the non-self-supporting, protection-needing, by that under the water; the highly prosperous business by those points highest above water level, the most bankrupting business by those points farthest below. Now, any attempt to elevate the points below water-level at the general expense of all those above will result in sinking as many on an average
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of those already above as are brought up from below, and the farther up from beneath water-level a point is brought the heavier will be the downward pressure it exerts on the uncovered points supporting its weight.Just so with our protective tariff. The protection of one business means the sinking of another that, before, was just struggling above the waves of adversity; and the farther from beneath we bring a business, that is, the more protection it needs, the greater is its sinking influence on those afloat.
But if the floe, instead of being perfectly solid, is somewhat flexible, so that some parts may be slightly depressed without affecting other points, then some of the extremely high points might be made to support and float some of the slightly depressed surface, without weighting those high portions to the point of being submerged, and thus a larger floating area might be secured. Likewise, if some of those avocations requiring only a slight degree of protection could be supported at the expense of the highly prosperous ones only, it might be possible to increase the number of avocations. But the sinking influence of protection-needing business should be saddled only on the highest points, which are the luxuries, bought only by the rich, who can well afford them.
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When, therefore, of two articles to be taxed, the one is a luxury and the other a necessity, common-sense and humanity teach us that the tax should be placed on the luxury rather than on the necessity, for then only those who are able and willing need pay the tax, as no one is forced to buy luxuries.
Collecting revenue by taxing luxuries is, in fact, collecting it from incomes based on luxurious expenditures in living. This method, while stripped of the inquisitorial features of an income tax, distributes the burdens of government upon those most able to bear them, and to whom they in justice belong.
"He owes the nation most whose means of happiness are greatest." But the necessaries of life all alike need, and all buyers are therefore forced to pay any tax put on them. Now, luxury duties and protective duties diametrically conflict, and we may have either one or the other, but not both at the same time. For example, there is clothing, an acknowledged necessity; and if we propose to take the tax off of it, the protected manufacturers cry out that without a protective tariff they cannot run their business, and if we levy taxes, on the underlying principle of protection, then we must grant their demand, regardless of the fact that clothing is a necessity. But if the taxation of
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luxuries is our object, then we must remit the tax on clothing, as it is an acknowledged necessity and not a luxury. To those who object to a tax on luxuries we can simply say, avoid the use of the luxury and you need pay no tax, but he who is able to buy luxuries ought also to be able to pay the tax on them.It has been argued that tobacco is the poor man's only luxury and therefore should not be taxed; but the poor man's wife and children do not use tobacco, and on this his single luxury, of which he in his family is the sole consumer, the honest son of toil will surely not set a selfish precedent for the rich, by asking that this his sole luxury be free and all the rich man's taxed, while his family are yet taxed on food and clothing.
Protection is the father of "trusts," monopolies, and corners, and without it but few of them could exist, as monopolies can flourish, trusts squeeze, and corners crush only when they have a limiting boundary or wall against which to squeeze the people: and our high protective tariff forms just such a limit, thus making it much easier to control and manipulate the price within our protected borders than to handle the entire world's product.
Wherever healthy competition among home manufacturers would have materially reduced
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the cost of domestic-made goods below the tariff-increased price of similar imported goods, these trusts have been formed to strangle competition and keep up the exorbitant prices. Reduced tariff or free trade, by allowing outside competition, would at once be the deathblow of all this class of trusts, at least.It is asserted that protection is not unjust or partial, because every one has an equal privilege to enter protected avocations. Such, however, is not the case, as every one does not possess sufficient capital to enter a protected business; and even if he did, these powerful combinations and trusts which our high protective tariff has hatched stand ever ready to crush out and swallow up every new rival in their line of business.
Moreover, by the same logic we might prove that a law granting immunity to swindlers and thieves was not unjust, because then everybody had an equal right to swindle and steal.
But if protection is such a benefit to the laborer and Nation because, as protectionists assert, it insures such large profits to the manufacturer that he is thereby able to pay his workmen better wages than if his profits were less, then, for the same reason, trusts, which insure to the combination or monopoly still larger
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profits, must be proportionally still more beneficial to the Nation and laborer.But wage-earners have come to sadly realize that because men make large profits and are well able to pay high wages is no reason or guarantee that they will pay them, but, on the contrary, they generally pay as little as they can help, and are ready for a lock-out, for imported contract labor, or in fact most any means of hiring laborers cheap.
Jay Gould is better able to pay $500 to have his boots blacked than many men are to pay five cents, yet Jay pays only his little old nickel for the job, the same as any other man.
And as all protection-money goes first directly into the factory-owner's hands, he is privileged to withhold from his employés any or all of the protection he receives, which latter he almost invariably does.
But if protection really is such a grand, good thing for the individual, the nation, and the world, why not have more of it? Why not protect everything? Why is this the exact sum that is just right, -- no more, no less? Why not extend this grand system to the States and collect their taxes the same way? Why have this free trade between States if protection or restriction is better?
That a high protective tariff fails to protect
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the laborer and give him sufficient wages, is proven by the need of Labor Unions and other organizations of labor, formed to secure the very objects which protectionists declare that the protective tariff already ensures him. Every name on the roll of organized labor is a silent protest, and every member of a labor organization a living evidence, that twenty-five years of a surfeit of protective tariff has not only failed to protect the laborer and increase his wages, but, on the contrary, has rendered necessary these organizations, in order to secure these objects: for it is in these very protected occupations that the most perfect organization exists, and is most needed to sustain wages and protect the workmen. Every workingman who has joined a labor organization has, by that act, declared that a high protective tariff has failed to give him the sufficient protection and wages which he seeks within the labor organization he joins, otherwise there would have been no need of his joining the union, in order to get what he already had.127
Chapter XIV. "Free Trade Only a Theory," Etc.
PROTECTIONISTS object that free trade is only an untried theory, while protection is an existing practice.
Fifty years ago bleeding patients for almost every disease, indiscriminately, was an almost universal practice, yet it has given way to opposing theories, and is out of existence to-day, or confined, leastwise, to bleeding the pocket.
Slavery was also an existing practice in the United States thirty years ago, and its abolition only a theory. But the theory of that period has supplanted the contemporaneous practice with beneficial results to all concerned.
So, because a certain practice exists, proves neither its superiority nor the inferiority of opposing theories.
And until those theories have been given similar practical tests, under precisely similar circumstances, all arguments about the superiority of protection over free trade are as much untried theories as are free-trade arguments.
We have never had in this country even a low
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tariff, much less free trade, in connection with no slavery, a sound national currency, and many other of the blessings of progress; and until we try them together we cannot fully estimate the effect of these latter auxiliaries.But as the blossom precedes the fruit, the rosy infant the brawny adult, the conception the consummation, so must theory invariably and inevitably precede practice and progress. And in England, where it has been tried, free trade has proved a blessing to the nation and its people.
As though we did not understand our own affairs as well as Englishmen do, protectionists have actually gone to England for an interpretation of the President's message, and quote extracts from the English newspapers.
As imitation is the sincerest flattery, we need not wonder if Englishmen should speak in complimentary terms of our advance toward or conversion to a principle which they have advocated, adopted, and practically demonstrated the superiority of. It was in the same spirit that they, forty years ago, advised us by example as well as by precept to free the slaves.
Moreover, the advice of those who practise what they preach comes with better grace and more evidence of candor than under contrary conditions. But, as there are two opposing parties
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in the United States, so there are likewise two opposing parties in England, and the weight of all English comment depends in a great measure upon which one of the English parties it comes from.They who would be wise must learn from every example, no matter where the wisdom originates. The wisdom of to-day consists almost entirely of the collected wisdom of the past, and what is true of the present applies equally to the future. Those who object so fiercely to free trade because it is English should remember that the very foundation of our law is English jurisprudence, and that our two Houses of Congress are modelled after the two Houses of Parliament, and their rules and regulations of procedure are based on parliamentary law.
Besides, in advocating protection, these English-lion-tail-twisters are simply upholding unwittingly a superannuated and obsolete English system which she has outgrown and discarded, and they should remember that the antiquity of either a wrong or a falsehood is no justification thereof.
In 1860 our foreign tonnage lacked but one ship of being equal to that of England, and was growing at nearly double their rate, so that in 1861 it was the largest in the world; but to-day
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only one-sixth of our foreign trade is carried in American bottoms.It appears that about one-half of the people in the United States favor tariff reform, and the accusation that all these are British free-traders, seeking the good of England and the downfall of America, is the very apex of absurdity, and comes with very bad grace from the party whose policy of protection has driven the American flag from the high seas more effectually than has ever any open avowed enemy yet succeeded in doing.
Ah, truly, consistency, thou art indeed a rare jewel in protectionists' arguments!
But protectionists say the country is good enough for them, and those who are not satisfied with the laws as they now are can leave it.
It is no doubt very generous of the protectionists to give those who differ from them in opinion this alternative, but they should remember that it was dissatisfaction with the situation, which some in Europe then thought good enough, that peopled America and made her what she is: and these complacent, easily satisfied people never aid but hinder progress; for our forefathers had been easily enough satisfied, they would never have either emigrated or fought for freedom, and we should yet be under English rule. Because a thing is good
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enough is no reason why it should not be made better if it can be.If, because the first steamboat was better than any other, all should have agreed that it was good enough, and, acting on that principle, made no effort at improvement, no improvement would ever have come. Progress says nothing is good enough so long as room for improvement remains.
Besides, those who think there is room for improvement happen to have as good a right to their opinion, and as good a right in America too, as they who think otherwise. But the fierce opposition of the latter to even a trial of lower tariff shows that they fear to let people see the results, for if such results as they predict came, we could and would at once repeal the new law and re-enact the old, and protectionists would have everything their own way for forty years to come. But their very position betrays them, for, while claiming that protected industries have been so wonderfully benefited and increased, and their products so cheapened by protection, they yet claim that after twenty-five years of this so-called invigorating protection they are not able to compete with England, who has pursued for forty-two years this so-called enervating policy of free trade; that we now need more protection than we did any time in the last
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twenty-five years, and that any reduction in the tariff, even though so small as 15 per cent, will work incalculable damage to them.This proves that those protected industries are actually weaker to-day than twenty-five years ago, else they would not now need more protection than then.
They therefore have received no permanent benefit from protection, but only such transient benefit as charity money usually brings, -- i.e., lasting so long as the money lasts and no longer.
It also proves that this claim of protection having reduced so rapidly the price of protected products is utterly false; for if the price of such articles had declined more rapidly inside than outside our protected borders, they would not now need as much protection as they did then.
They enumerate clothing, blankets, and other protected articles, which they say are as cheap here as in England.
If so, will they please tell us what need we have of a protective tariff on goods that are as cheap or cheaper here than anywhere else?
But, notwithstanding the unjustness of a protective tariff, the immediate abolition of all tariff and the adoption of free trade is not advised.
The change should be gradual and conservative,
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for when the laws of the land legalize certain enterprises, unjust though they be, into which the capital of innocent investors has been drawn, it would be unjust to those investors to suddenly, at one blow, destroy or cause a large shrinkage in the values in which that capital is invested, without allowing it some opportunity to hedge and cover itself.Besides, there may be a few such charity-needing occupations now afloat that free trade would entirely sink without the protection of this charity money, and they too deserve some consideration. This conservative and gradual reduction is what is usually understood by Tariff Reform.
Most all Americans would willingly pay a little more to home manufacturers than to foreigners for similar goods, just the same as you would rather pay your neighbor blacksmith 5 or 10 per cent more for the same job that a blacksmith two miles away would do for that much less. But when it comes to paying 47 per cent more on the dollar's worth, forbearance ceases to be a virtue, and even Americans become justly indignant.
We do not even object to tariff taxation; for as there are a national debt and pension obligations that must be paid, we are willing to continue raising this revenue by means of a tariff
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tax; but we most sincerely and earnestly object to and protest against the protective principle in our present tariff, which enables a favored class of manufacturers to collect from us, for their own pockets, an equal or eightfold greater tax than the government collects.If this be free trade, then make the most of it. But because a man thinks one, two, three, or even a dozen of our laws bad ones, and wants them abolished, is no reason why he should be called an anarchist and represented as in favor of abolishing all law.
Likewise, because some men think the tariff rate excessive, and want it reduced though not abolished, is no reason why they should be represented as free-traders, and the tariff-reform measure they propose as a free-trade measure.
But the assertion by protectionists that a reduction of tariff means eventual free trade is a virtual confession by them that if the people once try a reduction they will be so well pleased with it that they will keep on reducing until they reach free trade; for no such goal can be reached, nor even a reduction of tariff be made, unless the people by their votes show their consent to it.
Absolute free trade is a simple impossibility for the next quarter of a century at least; for
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with such a heavy national debt and such a vast pension-roll, and no other visible means of raising the sum necessary to meet these expenses, we could no easier dispense entirely with our income from tariff tax than we could with that from our State taxes.But the question is simply whether the Nation, unlike the State, has a just right to tax you for other than the government's needs, a right to tax you for the protection and support of some private enterprise or monopoly, a right to take some of your hard earnings under cover of law and give it to whom it chooses.
This question of protection involves the slavery or freedom of a nation of so-called freemen.
What is slavery but the usurpation of the laborer's right to the fruits of his toil? He who owns my labor owns me, and he who can levy a tribute, even though it be by law, on the unborn fruits of my labor is my master, though he may waive the right of being called so.
The negro slave of thirty years ago was himself powerless, and had to stand by and see others settle the question for or against him; but on this subject every voter has as vital an interest as had the slave, and he also has the right to act for or against his own and posterity's interests. There is no middle ground.