Chapter VI: Foreign Trade (3)

Fallacy A: _that a nation may still sell to foreign nations while prohibiting the buying from them_. Protectionism is multiplied prohibitions on the buying of goods from foreigners. Between four and five thousand of such prohibitions deface our national Statute-book at the present moment. All the while, however, the assumption underlies this policy, and the express proposition is often heard in different forms along the lines, that our citizens may still sell their products to foreigners, nevertheless. England has _got to buy_ our cotton or starve: the Continent _is compelled_ to take our pork products, for they are the cheapest food in the world: how can China or India _help_ taking the silver from our mines? Softly. Buying and selling from the very nature of it is never compulsory, but always voluntary. A commercial service is never rendered but in plain view of a return-service to be received. The mental estimation of each buyer is couched in the very terms of what is offered in return by each seller. Buying and selling from its inmost nature is always one act of two persons acting conjointly and inseparably to the advantage of each. How, then, can the individuals of one country _sell_ anything to individuals of another country without at the same instant _buying_ of these in return? The act of selling is just as much buying as it is selling, and the act of buying is just as much selling as it is buying. As we have abundantly seen already, the introduction of Money as a _medium_ in the transaction makes no difference in the _nature_ of the exchange of commodities internationally. The postulate, therefore, that the people of one country can continue to sell products to the people of another while refusing to take their products of some kind in return, is an _absurdity_ in the nature of things and an _impossibility_ in the world of facts. _A market for products is products in market._

All known facts confirm this irrefragable reasoning, and discredit utterly the fallacy in hand. When France and Germany a few years ago gave back to our protectionists a dose of their own medicine, and prohibited American pork-products, ostensibly because they feared the trichinæ but really to cajole their own farmers under the plea of protectionism, their brethren in the faith have made up all sorts of faces ever since, have wound up the respective diplomatic clocks to strike twelve against the too presumptuous countries which ventured to restrict American products in their ports, have protested and proclaimed. What is the matter? Is not sauce for the goose sauce for the gander also? Have not American protectionists shut out French and German products 100:1 under the same plea now used on the Continent? "_But we cannot sell our products abroad_," cry the angered Western farmers. Of course they cannot, because restrictions on buying _are_ restrictions on selling; and additional restrictions of the same kind put on French and German buying are of course still further restrictions on American selling. And the farmers are, as usual, the victims both ways.

To hear an ordinary American protectionist talk, one would think that Great Britain is the enemy of mankind for admitting into her ports practically without let or hindrance the goods of all the world. _Free Trade England!_ Let us look a moment. England has to pay for all these goods received from all quarters. In what does she pay? In her own goods, of course. What is her market? The whole world. Is that market ever slack on the whole? Never. Is she ever flooded with cheap goods? The more she buys the more she sells of necessity. How much does she sell _per capita_ of her people? More than twice as much as the United States sells _per capita_. How can she sell so much of her own stuff? Because she buys freely other stuff from all the world. What are the limits to her capacity to sell her own goods to foreigners? Precisely the limits of her willingness to take in pay other goods from foreigners. Cannot these limits be overpassed in either direction? By no possibility: when people can no longer pay for what they buy, the buying ceases; and when they are not permitted to take their pay for what they sell, the selling ceases. Is this free trade profitable to Great Britain? Immensely so in every way. Whither has it carried up her ocean-marine? To the topmost notch. Is capital abundant in England in bulk, and are its loanable rates low? England is the richest country in the world, and all nations resort thither to buy. What is the source of this vast volume of Capital? The only source of Capital is savings from the natural gains of Buying and Selling.

Is Great Britain willing to take in goods from the United States? Certainly, under the universal conditions of taking in foreign goods at all. Is the United States willing to take in British goods in pay for her own goods exported thither? She is not, except over protectionist barriers averaging 47%. Is it a good thing for the United States, that Great Britain takes in her goods freely? We should suppose so! Does the former already sell to the latter and through the latter more goods than to all the world besides? Much more. Could this profitable trade be easily increased? It could be quadrupled in a very short time. How? By simply according to our citizens a decent liberty, which is their inalienable right. Would the United States like it to be commercially treated by Britain exactly as the former treats the latter? It would bankrupt the United States in six months. Would our protectionists like it? It would make them howl. Is it the commercial salvation of the United States that Britain is immovably for free trade with her and the rest of the world? Nothing else saves her from commercial ruin. Can the ghost of a reason be given, commercial or other, why the United States should continue to fling double fists into the face of British goods seeking a market and so making one? Not a shadow of a shade of a good reason was ever given for such folly, or ever can be.

It is more than a pleasure to acknowledge at this point the great service done by James G. Blaine, Secretary of State, during the summer of 1890, to Country and Commerce, by his courageous avowal contrary to his own personal record and to the vehement behest of his party, that the economic principle just enunciated is sound, and should be at once applied by the United States in connection with all the countries of Latin America. In a letter to the Senate on the results of the recent Pan-American Conference, he said: "_The Conference believed that while great profit would come to all the countries, if reciprocity treaties could be adopted, the United States would be by far the greatest gainer._" The principle of reciprocity is the principle of free trade applied by both parties to the trade. It is the sound principle, that goods buy goods and pay for goods at the same instant to a mutual profit. Manifold reiterations of this principle came from the Secretary that summer, especially in vigorous protestations against the McKinley tariff-bill then pending, alleging with truth that "_there is not a line or a section in the bill which opens a market for another bushel of wheat or another barrel of pork_." The unequivocal statements of a favorite statesman have roused the somewhat indifference of thousands of citizens, and make certain the speedy prevalence in the United States of the unassailable doctrine, that any People must buy freely if they would sell broadly.

Fallacy B: _that tariff-taxes are needful in order to start infant industries_. There is no analogy whatever between Child-bearing and Child-growing and any form of Buying and Selling at any time, but the deceit in the wretched simile has cost the world billions of dollars of pure loss. To bring up infants from birth to maturity is indeed a good deal of a task for the parents, but it is not in any sense an economical task: the parents neither ask for nor receive a return-service in kind: the transaction is wholly moral in its character, and not economical at all: there is no party of the second part in the premises: there is a free giving, and that is all. Buying and Selling, on the contrary, has no infancy, and no maturity and no old age. This particular Minerva springs at once full-grown and full-armed from the brain of Jove. The conditions of Trading are forever the same; with no reference to the age of the parties, the antiquity of the industry, or any other such irrelevant thing. If any person anywhere (old or young) has got something to sell, and finds (directly or indirectly) any other person anywhere who wants his wares and can pay for them,--all the conditions of mutual profit are present, and everything else is an impertinence.

Much more than this. Tariff-taxes have to be paid by somebody. Their payment is inexorable at the custom-house, and interest and other charges are added before the sum reaches the ultimate payer. But the ultimate sum however made up is exactly so much _out_ of the commercial gains of the payer. The sign is every time _minus_ and _not_ plus. When egregiously high tariff-taxes are multiplied in number, and all the additions are made to them, they become an incalculably large sum, every cent of which _has to be paid_ out of the gains of current Industry. Now, what a queer way that is to foster industries! What a queer way to help start them! It takes Capital to start new industries, and to carry on old ones; but tariff-taxes (with all their accretions) take just so much _out_ from what would otherwise naturally become Capital. That is to say, all Capital is savings from the gains of Exchanges; and these gains are _reduced_ by every tariff-tax that touches them directly or indirectly. Taxes from their very nature can help nobody. They hurt everybody. What a device this is to start new industries with, namely, to pick the pockets of the very men, who are to start the industries, if they ever are to start at all! Lower your reservoir to begin with, in order to give head and force to your faucet flow!

But this is not half of it. On what industries do the protectionist taxes fall at first to weaken and discourage them? Of course on the natural and profitable ones, which only ask to be let alone in order to maintain a healthful life and growth. If, under natural conditions, any industry is in existence, one may be perfectly sure it is profitable, since Profit is the only thing in the world that can start and build up an industry: when the profit ceases, the trade ceases of necessity: the motive to it is _gone_. In behalf of what sort of industries are these taxes ostensibly and plausibly levied? Only, if we are to believe the protectionists, the weak and presently unprofitable ones. _It is the infant industries that need the nursing-bottle!_ That is to say, tax down and perhaps destroy the _profitable_ industries, the industries that _pay_, that can paddle their own canoe and no thanks to anybody, in order to bring forward certain other industries, which by confession and open proclamation are _unprofitable_, and can only _start_ by taxing their neighbors! Of course, there is a cat in this meal, and we shall let her out of the bag in plain sight presently; but we are taking now our friends, the protectionists, at their own word, and exhibiting their marvellous wisdom under the terms of their own choosing. What a blessed way for a nation to grow rich, to smite down with high taxes the active and enterprising and independent and therefore profitable industries with one hand, and grope around with the other to find some poor and inactive and unfrugal and naturally unprofitable industries, in order to fetch forward these by means of the plunder filched from the others!

To go back for historical illustration to Washington's first administration, when the first (extremely mild) protectionist taxes were levied in this country, we have the highest authority for knowing that many of the leading branches of manufactures were prosperous and profitable. They had no artificial help in order to start, but on the contrary had had continual discouragement for a century under the miserable protectionist policy of the mother country. Washington himself was inaugurated in a dark brown suit of woollen cloth of American manufacture: so was John Adams inaugurated first Vice-President of the United States about the same time in a garb of wholly native manufacture.[11] This was in April, 1789. In November of the same year, Washington returned to New York from his first tour in New England "_astonished both at the marvellous growth of commerce and manufactures in New England and the general contentment of its inhabitants with the new government_" (Schouler, p. 117). Alexander Hamilton, the first Secretary of the Treasury, in his famous Report to Congress on Manufactures, in 1791, enumerated seventeen branches as then thriving so as to fairly supply the home market, and settle into regular trades. These were, skins and leather, flax and hemp, iron and steel, brick and pottery, starch, brass and copper, tinware, carriages, painter's colors, refined sugars, oils, soaps, candles, hats, gunpowder, chocolate, snuff and chewing tobacco. It is plain enough from the debates of the time as well as from the nature of the case, that the protectionist taxes in our first two Tariffs, already considered here in detail, although they were comparatively slight in number and amount, fell in the way of discouragement on these incipient yet independent manufactures as well as upon all the farmers of the land. There can be but little rational question, that the woollen industry was sounder at the core in 1789, when Washington was inaugurated in native woollens, than in 1889, when Harrison was inaugurated in the same, the ostentatious gift of a firm of protectionist woollen manufacturers shortly afterwards adjudged to be bankrupt and fraudulently so.

The best point, after all, to make against this hollow fallacy, is the practical one, that no industry whatever, whether "infant" or other, has ever come in this country into an acknowledged self-sustaining position under a whole century's tariff-taxes. Salt, hemp, coal, cottons, woollens, nails, and iron and steel products generally, were the chief articles protectionized at first, and have been protectionized ever since, but no one of them all has ever come into a condition of self-support according to the view of the privileged beneficiaries. Each one of them was an old industry, and a relatively rich industry, when it was taken under the "fostering care" of the tariff-taxes, levied for their further enrichment on the masses of the people; and it was only greedy and secret combinations among these for that purpose, which put them at first and has kept them ever since in the rank of public beneficiaries. The simple truth is, that diversity of employments is rooted in human nature and in the circumstances amid which God has placed men, and so far is it from being true that taxes and restrictions are needful in order to foster manufactures, taxes and prohibitions cannot prevent them from springing into life! They are just as natural to men and to colonies as agriculture is. Indeed, agriculture can scarcely take a step without them. The farmer must have ploughs and carts and other implements; and, depend upon it, there are some natural mechanics in that colony. Clothes are as needful as food, and spinning and weaving in some form will begin at once, and prohibitions will be powerless to stop them.

Deadly to the fallacy in hand is the word of unquestionable History. Any one may read in Palfrey and Bancroft and Hildreth such facts as these, scattered all along through the noble volumes. The manufacture of linen and woollen and cotton cloth was begun in Massachusetts in 1638, in Rowley, by some families from Yorkshire; and became so remunerative in a couple of years that some acts of the General Court designed to stimulate it were repealed. Brick-making and glass-works and the manufacture of salt were all begun in Massachusetts before 1640. In 1643, the younger Winthrop established iron-works in Braintree and Lynn, which after some losses were successfully prosecuted. Within less than twenty years thereafter, tannery and shoemaking had made such strides, that boots and shoes became articles of export. That these were no fancy beginnings in manufactures, we may strikingly learn from an Act of Parliament passed in 1698. Notice the date. This law is a sample of many more:--"_After the first day of December, 1699, no wool, or manufacture made or mixed with wool, being the produce or manufacture of any of the English plantations in America, shall be loaden in any ship or vessel, upon any pretence whatsoever,--nor loaden upon any horse, cart, or other carriage,--to be carried out of the English plantations to any other of the said plantations, or to any other place whatsoever._" Thus the fabrics of Massachusetts were forbidden to find a market in Connecticut, or to be carried to Albany to traffic with the Five Nations. "That the country which was the home of the beaver might not manufacture its own hats, no man in the colonies could be a hatter or a journeyman at that trade, unless he had served an apprenticeship of seven years. No hatter might employ more than two apprentices. No American hat might be sent from one plantation to another." In 1701 the three charter colonies are reproached by the lords of trade "_with promoting and propagating woollen and other manufactures proper to England_." In 1721 New England alone had six furnaces and nineteen forges, and there were many others in Pennsylvania and Virginia. Parliament enacted in 1750 that no more mills should be erected in America for slitting or rolling iron, or forges for hammering it, or furnaces for making steel; and in certain cases, agents of the crown were authorized to tear down such establishments as "_nuisances_." How far all the arts of navigation had been carried in the Colonies before the Revolution, every one may read in Burke's famous speech on Conciliation with America. How far the products of the loom, the forge, and the anvil, were already being exported, in spite of British legislation, to other countries, any one may see in Lord North's last proposals and concessions to ward off Independence.

Protectionism having once fed its petted beneficiaries from the public crib, that is to say, from taxes wrenched from the many to enrich the few, invariably clamors for more and more rations for its pets from the same public source. Not only does no industry become self-supporting by its bite and its sup, but each becomes according to its own facile representations and representatives, more and more helpless in itself, more and more shameless in its demands, more and more _entitled_ to public charity, and less and less inclined to surrender one iota of past or present privilege. The daughters of the horse-leech cry continually, Give! Give! The following schedule relates to woollens mainly, but it is a fair sample of many other protectionized classes of goods under the successive tariffs in this country, in point of increased taxes on the people in their behoof. While these lines are being written, the McKinley tariff-bill, so-called, having passed the House, is pending in the Senate. It is significant, that this piece of legislation, whether it be finally enacted or not, proposes to open the second century of the United States Protectionism by largely hoisting the tariff-taxes along the main line. Infant industries indeed!

======================+===============================================
| RATE OF DUTIES UNDER THE TARIFF OF
ARTICLES. +-----+-----+--------+--------+--------+--------
|1791.|1859.| 1861. | 1864. | 1883. | 1890.
----------------------+-----+-----+--------+--------+--------+--------
| Per | Per | | | |
|cent.|cent.| | | |
Dress goods of cotton | 5 | 19 | 30 per | 55 per | 68 per | 88 per
and worsted, | | | cent.| cent.| cent.| cent.
costing 15 cts. | | | | | |
the sq. yd. | | | | | |
| | | | | |
Same, costing 20 | 5 | 19 | 30 " | 50 " | 60 " | 90 "
cents sq. yd. | | | | | |
| | | | | |
Same, all wool or | 5 | 24 | 30 " | 47 " | 77 " |100 "
of mixed materials, | | | | | |
costing 24 cents | | | | | |
sq. yd. | | | | | |
| | | | | |
Same, costing 30 | 5 | 24 | 30 " | 55 " | 70 " | 90 "
cents sq. yd. | | | | | |
| | | | | |
Same, costing 60 | 5 | 24 | 30 " | 45 " | 55 " | 70 "
cents sq. yd. | | | | | |
| | | | | |
Same, weighing over | 5 | 24 |25% and |40% and |40% and |50% and
4 oz. sq. yd. | | | 12 cts.| 24 cts.| 23 cts.| 44 cts.
| | | per lb.| per lb.| per lb.| per lb.
| | | | | |
Ready-made clothing |7-1/2| 24 |25% and |40% and |35% and |60% and
| | | 12 cts.| 24 cts.| 40 cts.| 50 cts.
| | | per lb.| per lb.| per lb.| per lb.
| | | | | |
Tapestry Brussels |7-1/2| 24 |30 cts. |50 cts. |20 cts. |28 cts.
carpets | | | sq. yd.| sq. yd.| sq. yd.| sq. yd.
| | | | | and 30%| and 30%
| | | | | |
Tapestry velvet |7-1/2| 24 |50 cts. |80 cts. |25 cts. |40 cts.
carpets | | | sq. yd.| sq. yd.| sq. yd.| sq. yd.
| | | | | and 30%| and 30%
| | | | | |
Brussels carpets |7-1/2| 24 |40 cts. |70 cts. |30 cts. |40 cts.
| | | sq. yd.| sq. yd.| sq. yd.| sq. yd.
| | | | | and 30%| and 30%
| | | | | |
Druggets and bockings | 5 | 24 |20 cts. |25 cts. |15 cts. |20 cts.
| | | sq. yd.| sq. yd.| sq. yd.| sq. yd.
| | | | | and 30%| and 30%
| | | | | |
Silk goods, including |7-1/2| 19 | 30 per | 60 per | 50 per |Average
velvets and plushes | | | cent.| cent.| cent.|probably
| | | | | | 90%
| | | | | |
Woollen hosiery and | | | | | |
underwear: | | | | | |
Costing 32 cents | 5 | 24 | 30 " | 90 " | 77 " |214 per
per lb. | | | | | | cent.
Costing 42 cents | 5 | 24 | 30 " | 79 " | 79 " |175 "
per lb. | | | | | |
Costing 62 cents | 5 | 24 | 30 " | 62 " | 74 " |135 "
per lb. | | | | | |
Costing 82 cents | 5 | 24 | 30 " | 54 " | 82 " |120 "
per lb. | | | | | |
| | | | | |
Linen goods | 5 | 15 | 30 " |Average | 35 " | 50 "
| | | |37-1/2% | |
Cotton hosiery: | | | | | |
Costing 62-1/2 cents|7-1/2| 24 | 30 " | 35 per | 40 " |110 "
per doz. | | | | cent.| |
Costing 2.10 cents |7-1/2| 24 | 30 " | 35 " | 40 " | 76 "
per doz. | | | | | |
Costing 4.10 cents |7-1/2| 24 | 30 " | 35 " | 40 " | 64 "
per doz. | | | | | |
======================+=====+=====+========+========+========+========

It is also significant in this connection to read an extract from the Report of Mr. William Whitman, President of the National Association of Wool Manufacturers, dated March 29, 1890, to the Stockholders of the Arlington Mills, Massachusetts. "_I have been your Treasurer for a consecutive period of twenty years. During this period the average earnings have been_ 20-8/10 _per centum upon the capital. The earnings of the last year were nearly three and a half times those of the year previous, and there is every indication that the current year will be the most profitable one in the company's history._"

Fallacy C: _that a home market is better and broader than a foreign market_. Professor Thompson of Pennsylvania has publicly and repeatedly stated, that, by a persistent policy of Protectionism a "home market" would be created for all the bread-stuffs that this great country produces; and John Roach, the shipbuilder, expatiated at length before the Tariff Commission of 1882 on the advantages the farmer derives from the better "home market" already created by Protectionism. To come nearer home in place and further down in time, there was organized in Eastern Massachusetts with headquarters at Boston in some connection with the national election of 1888, a so-called "Home Market Club" of large proportions. It is generally understood in the State, that a large minority, if not a majority, of the members, are displeased with the McKinley Bill of 1890, declaring that the mustard is carried to fanaticism in this bill, that neither the "home market" nor any other can profit by such a series of prohibitions.

However this last may be, it is plain, that a ridiculous and most harmful fallacy underlies all references to a "home market" in any connection with foreign trade. It is simple Gospel charity to believe, that Thompson and Roach and the founders of the Home Market Club and all others, who repeat this wretched stuff, never stopped in their thoughts long enough to inquire what a "market" really is, never analyzed into its simple elements that composite thing called a "market," but each and all in turn have taken up a catch-word carelessly which seems on the surface to have some significance though in reality it has none.

All will agree, if they will stop to think, that a "market" is always made up of _buyers_ with return-services in their hands. A bigger home market than before consists only in more domestic buyers than before, all ready with acceptable pay in all their hands. More persons than before, more services-in-return than before. Now, if Protectionism _can enlarge the home market_, it must be (1) either by increasing the number of births or diminishing the number of deaths in a given time in a given country. Precisely how big bundles of big taxes, which the whole population must pay in one form or another and over and over again, may be made to stimulate births or prolong lives, no reasonable man can see, and it is not unreasonable to deny that a protectionist can see it. But conceding that he can see and show this, his task is then but half done, for he must proceed to see and show how these same onerous taxes are able (2) to multiply the return-services in the hands of this increased population!

If he think at all, the protectionist is compelled to remember, that his system is always and everywhere a series of prohibitions on profitable trade. A profitable trade always gives birth to gains. It always gives birth to Capital. It always gives birth to Plenty. That is the nature of it, and the Divinely ordained blessing on it. But when the greater part of these gains are artificially cut off, when the possible capital is reduced in volume, when the scarcity comes in which is the primary _purpose_ of Protectionism to create, it shall go hard if there be even as many return-services as when the process began. Not a better "home market," but a more meagre one, is the inevitable issue of restrictions and prohibitions.

If our protectionist try to get out of this snug place, in which he now finds himself, provided he is able to feel the force of any logic whatever, by claiming that his broader "home market" is to be made by new immigrants with old-world values in their hands to buy with, he certainly cannot escape by this route, because (1) he must in order to do this see and show what there is in big taxes enormously multiplied to invite immigrants here at all; and (2) our typical protectionist is scared to death by the _handiwork_ of foreign "pauper labor" wherever exposed for sale, and of course he is not prepared to welcome the pauper laborers themselves, of which class as described by him the immigrants would mostly consist; and besides, the tariff would not admit to our shores the old-world values, which would be the immigrants' sole _return-services_ to help make up the new market!

Within a week of the present writing, Senator Morrill of Vermont has broached from his place the idea in debate, that the industries of the United States can be so stimulated by protectionism as to cause the consumption of all the agricultural products of the United States. Well, when? The stimulus has been applied now just thirty years under Mr. Morrill's own eye, and by a tariff called by Mr. Morrill's own name, increasing its rates every little while, even in 1883, when the public pretence was to diminish them; and agricultural products of all kinds, including lard and pork and wool, have never been so "deadly dull" as in this interval of high protectionism. Scores of thousands of bushels of well-ripened Indian corn were burned for fuel in the more western States and Territories the very last winter, because the market for it was too poor to pay for its transportation to Chicago over protectionized rails, and in cars built of tariff-cursed lumber, every nail and bolt and screw in which doubled in price from the same general causes. If Mr. Morrill were not in his dotage, or if in his prime he had ever closely analyzed a single case of trade, foreign or domestic, he would see that the abandoned farms of his own State reckoned to be about one-third of the cultivated land on the eastern slope of the Green Mountains to the Connecticut River,--Mr. Morrill's own native region and residence,--abandoned farms for two years past assiduously sought by State officials to be filled in if possible by immigrants from Sweden virtually giving them the lands and farm-buildings,--fling out their flat contradictions to this senatorial drivel; that the constant decline for a quarter of a century of the farming population in every State in New England gives the lie to this miserable proposition; and that the constantly increasing area of mortgaged farms in every agricultural State in this Union is an overwhelming proof that the "home market" for farm staples has been growing constantly worse for years under this boasted protectionism.

The year 1890 is likely to prove the pivotal point of time in the swing of this whole proposition of Deceit, for two reasons, namely, (1) it is the year of the decennial Census, in which at least a half-hearted attempt is being made to bring out the aggregate area in each State of the mortgaged farming lands, and nothing can prevent the appearance in which of the lessening volumes of population in the purely agricultural communities; and (2) the year has already been marked by the political revolt from the party of protectionism of the masses of the farmers in the Mississippi Valley, and their organization into "Farmers' Alliances," naturally and demonstrably hostile to all Restrictions on the sale of farmers' produce.

Fallacy D: _that protectionism tends to raise the wages of general laborers_. In our third chapter, the whole doctrine of Wages was clearly and carefully laid down, and it is only needful now to remind the reader of two or three of those fundamental principles. The Labor-giver and the Labor-taker only touch each other at the old points of reciprocal Desires and Renderings. There are two persons standing in that relation each to each. A rate of Wages is always a result of a Comparison. If the Labor-takers, whoever they may be, more strongly desire the services of the Labor-givers, whoever they may be, other things remaining as before, there will be a rise in the rates of Wages, because Effects always follow the operation of Causes in Economics, as in all other scientific spheres; and if the Labor-takers, for any reason, desire less than before the services of Laborers, other things being equal, the general rates of Wages will decline of necessity.

Now, what is the necessary effect of Protectionism upon the general Demand for Laborers? How is the whole class of Labor-takers affected by prohibitory tariff-taxes? Note every time, that it is the presently and independently _profitable_ industries, the industries that ask for nothing except to be let alone, that are struck and restrained by these tariff-taxes; the fact that any industry is successfully going forward under its own motives is sufficient proof of its own profitableness; these are the industries, in every case, which are curtailed by restrictive tariff-taxes, their former gains are lessened of course and by design, and their _motives_ consequently to hire Laborers to carry on these branches of business now taxed and tormented are _lessened_; less Desire for Labor-givers gives laborers less every time round; the so-called argument of Protectionists is, to introduce alleged _unprofitable_ industries by means of taxing down _profitable_ ones; and pray, what effect must that have upon the general Desire to employ Labor-givers, and consequently what effect upon general rates of Wages?

Take one look further along this same line. Tariff-taxes of this character are designed to keep out, and do keep out, foreign wares, which are the natural and profitable market for domestic wares: how will this forced exclusion affect the Demand for laborers to make or grow the domestic wares whose market is now lost? And what is the influence on the Wages of those whose services are now in lessened Desire along the whole line? Causes produce their Effects everywhere and every time.

Dissatisfaction among, and actual disaster to, Labor-givers as a class, have always followed the imposition of protectionist tariff-taxes in this country, as a matter of plain observation and record; have followed increasingly and more disastrously increased restrictions and prohibitions on profitable trade; "Strikes" on the one hand to resist a lowering or secure a lifting of Wages, "Lockouts" on the other to bring laborers to terms, "Shut-downs" for pretended repairs in order to gain time to tide over the gluts that always accompany artificially restricted markets, semi-hostile relations between Employers and Employed, interruptions to travel and transportation, timidities of Capital fatal to new and enlarged enterprises, have never characterized this country so strikingly as during the quarter-century of Protectionism culminating in 1890.

The following table accurately compiled by Editor Philpott of Iowa, from the National Census, shows in remarkable figures the relatively slow rate of progress of the Nation in thirteen essential items of growth under the Morrill Tariff, as compared with the rapid rates of progress in the leading lines under the Walker Tariff. _The comparison lies in the per centum of increase over the previous decade of the period_ 1850-60 _relatively to each of the two periods_ 1860-70 _and _1870-80_: the average of the last two periods is taken for the sake of an easier comparison of the progress of the one decade (Walker) with the average of the two later ones (Morrill)._

+----------------------------------+------------+-------------------+
| Lines of Progress. | 1850-1860. | Average each Ten |
| | | years--1860-1880. |
+----------------------------------+------------+-------------------+
| Population | 35.5 | 26.2 |
| Wealth | 126.6 | 61.0 |
| Foreign commerce, aggregate | 131.0 | 45.6 |
| Foreign commerce, per capita | 70.3 | 15.2 |
| Railroads, aggregate | 240.0 | 69.0 |
| Railroads, per capita | 150.0 | 34.0 |
| Capital in manufactures | 90.0 | 66.0 |
| Wages in manufactures, aggregate | 60.3 | 58.2 |
| Wages in manufactures, per hand | 17.3 | 9.4 |
| Products | 85.0 | 69.6 |
| Value of farms | 103.0 | 23.6 |
| Farm tools and machinery | 62.0 | 27.7 |
| Live stock on farms | 100.0 | 17.3 |
+----------------------------------+------------+-------------------+

The State of Massachusetts has been diligently and scientifically taking the Statistics of everything relating to Laborers as such for many years; and we take now by way of confirmation of what has just been written a few statements of fact from the official Reports. _One-third of Massachusetts wage-earners were out of work one-third of the time under the benign influence of Protectionism [1887]. Wages went down in Massachusetts on the whole average 5 per centum 1872-83, while in the same interval of time they went up 9 per centum in Great Britain [1885]. Wages in Massachusetts advanced in 1830-60 (Walker) 52 per centum and in 1860-83 only 28 per centum (Morrill). What is called the needful cost of living increased in Massachusetts between 1860 and 1878 (Morrill) 14-1/2 per centum in spite of immense cheapenings in costs of production and transportation [1885]._

The U. S. Government has been gathering for a long time important Statistics relating to Laborers and their Wages and their Costs of Living, not only in the decennial Censuses but also in Consular Reports and in the Reports of a national Commission established for that purpose. We excerpt a few relevant statements from these almost at random. _Wages in free-trade England are from 50 to 100 per centum higher than they are in any protectionized country on the Continent of Europe. The aggregate Values of this country increased 1850-60 (Walker) 126 per centum, and in 1870-80 (Morrill) only 80 per centum, after reducing the census values of 1870 to a gold basis. Vessels American-owned and American-built controlled three-fourths of our foreign carrying trade in 1856, and less than one-sixth of it in 1886._

The Census of 1880 gives the total number of persons employed in the great subdivisions of industry in the United States as follows:--

Trade and transportation 1,810,256
Manufactures, mechanical and mining 3,837,112
Professional and personal services 4,074,238
Agriculture 7,670,493

The following table compiled from the censuses of the last four decades will be found to yield food for thought in the light of the present paragraphs. _It relates solely to manufactured goods at the four successive epochs._

+-----------+--------------+--------------+--------------+--------------+
| | 1850. | 1860. | 1870. | 1880. |
+-----------+--------------+--------------+--------------+--------------+
|Value of | | | | |
| products |$1,019,109,616|$1,885,861,676|$4,232,325,442|$5,369,579,191|
|Value of | | | | |
| materials | 555,174,320| 1,031,605,092| 2,488,427,242| 3,395,823,547|
|Wages paid | | | | |
| out | 236,759,464| 378,878,966| 775,584,343| 947,953,795|
|Materials | | | | |
| to | | | | |
| products, | | | | |
| per cent | 54| 54| 58| 63|
|Wages to | | | | |
| products, | | | | |
| per cent | 22| 21| 18| 17|
|Average | | | | |
| wages | | | | |
| earned | $247| $289| $377| $346|
|Capital to | | | | |
| products, | | | | |
| per cent | 52| 53| 50| 50|
|Number of | | | | |
| establish-| | | | |
| ments | 123,029| 140,433| 252,148| 253,852|
|Average | | | | |
| hands | | | | |
| each | 7.79| 9.34| 8.16| 10.79|
+-----------+--------------+--------------+--------------+--------------+

Our manufactures were put down in the Census of 1880 as in value $5,369,579,191. But this sum contains $1,670,000,000 that does not strictly belong to manufactures, such as flouring, lumbering, blacksmithing, sugar-refining, coffee-roasting, slaughtering, and a few others. This sum being taken out, there is left in round numbers but $3,700,000,000. This is not a great amount for 50,000,000 of people, and for a land with such natural advantages for manufacturing as our own.

Fallacy E: _that the costs of Wages to employers and of Materials to manufacturers somehow justify Protectionism_. The harmful confusion is constantly made here between Rates of Wages and Costs of Labor--two very diverse matters. Rates of Wages depend on a very different set of circumstances from Costs of Labor. Failure to draw this distinction, and a desperate desire to clutch even at a straw with which to bolster up absurd Restrictions, have made a hotch-potch and a caricature of attempted argument at this point. Rates of Wages have always been relatively high in this country as compared with the countries of Europe for two general reasons: (1) the country is new, with enormous natural advantages of every sort, with comparatively few laborers competing steadily with each other for work, large numbers of persons passing constantly out of the employed into the employing classes; and (2) there has almost always been from the first, and there is likely to be again in the immediate future even if there be not at the present moment, a Money in this country depreciated below the gold standards of Europe, in which the rates of current wages are always reckoned, and which makes them _seem_ to be higher than they actually are in purchasing-power. On the other hand, Costs of Labor have always been, and are now, low in this country as compared with Europe, for two general reasons also: (1) all classes of laborers are more efficient and skilled in this country than in Europe, working with more energy more hours in the week, under less cost of superintendence, being as a rule more temperate and healthful and educated persons, so that employers _get more for what they give_ than do employers abroad; and (2) the cost of that to the employers in which the laborers are paid, whether money or other valuables, is always less here than abroad, because the money usually is depreciated money which costs less in commodities, and even if it be not, the current prices of general commodities are higher here than there, so that the cost of wages paid directly or indirectly in commodities is less here to employers.

A second and distinct and wholly convincing proof, that the Cost of Labor to employers has been less here than abroad during the first century of our national existence, has been the unquestioned fact, that the Rate of Profits has been higher. A constant stream of foreign Capital has come hither for investment, drawn solely by the higher rates of Profit. But if the rates of Profit have proven to be higher, the costs of Labor must have been lower, because laborers and capitalists divide the whole returns between them. Nobody else has any claim upon the conjoint proceeds. _Profits are the Leavings of the Costs of Labor._ If, therefore, these Leavings are larger in one country than another, then of necessity the Costs of Labor are lower in the first country.

Now, Protectionists have had the effrontery (largely the result of ignorance) to contend, that they are at a disadvantage as employers of laborers on account of the rates of Wages they are obliged to pay to them! _Exactly the reverse is the truth._ Instead of being at any disadvantage at this point, it is a matter of absolute demonstration, that American employers pay the smallest costs of Labor in the world! Employers as such have no interest in the rates of Wages as such, but only in the costs of Labor to themselves as capitalists. High rates of Wages not only usually accompany low costs of Labor, but also are a proof of them! The patient (not to say stupid) American People have consented for thirty years past to be abominably taxed for the exclusive benefit of a set of brazen mendicants, on the ostensible ground, that the said public beggars were unfortunately placed in comparison with European competitors, when the simple truth has been, that they had a constant advantage in the best, and cheapest (in cost to themselves), and steadiest and most intelligent (on the whole), laborers in the world.

What is the truth about raw materials in this country? Especially raw materials in those branches of industry, which have been most steadily protectionized from the first, like iron and copper, and cottons and woollens? Can any reason be found for legislatively excluding foreign products of these classes on the ground of any disadvantage of our producers on the score of raw materials? Look at iron ore, for example, now protectionized to the extent of 75 cents per ton. No country in the world possesses such deposits in quantity and quality and accessibility of iron ore as the United States of America. Vast beds of the best ore in the world, especially in wide regions along the whole course of the Tennessee River, lie directly upon the surface of the ground; and the so-called "Iron Mountain" in Missouri is said to have ore enough above the general surface of the country round to supply the wants of the entire United States for two centuries! Yet every ton of this ore is artificially lifted in price to the very People to whom God gave it in exceeding abundance. The average cost of mining, washing, screening, and loading upon steam freight-cars for transportation to market, of brown-hematite ore at one of the Mines in Tennessee during the summer and autumn of 1890, was 33 cents per ton, with a constant downward tendency in cost as machinery was multiplied and methods improved. This included the rent paid to the owners of the land holding the ore-beds, and every other item of cost carefully computed by the owner of the capital and manager at the mines. This statement is made on the authority of the said owner and manager over his own sign manual, with his consent given that it be printed as at present in the interest at once of Science and Righteousness.

It has often been publicly stated by experts, that there is more coal in deposit in the United States than in all the rest of the world put together. Nevertheless, bituminous coal has been protectionized since 1874 to the extent of 75 cents per ton, and slack or culm (another form of coal) 40 and 30 cents per ton. The bounty of God to the people of this country has been so far forth thwarted by the greed of mine-owners acting on the subservience of members of Congress to the few rich combined for that purpose to the impoverishment of the unorganized masses. Especially has every interest of New England both popular and manufacturing been sacrificed to the short-sighted selfishness of the mine-owners, because the British Provinces, just to the northward, are full of bituminous coal waiting for a market against New England goods.

Limestone is a second indispensable requisite for the reduction of iron ores. God has put the ore and the coal and the lime in unfailing quantities in close proximity with each other throughout the entire valley of the Tennessee. So small is the natural cost of making iron in that favored region, that it has been transported this summer to Savannah by rail (freights heightened by tariff-taxes on steel rails and lumber), and then exported 3000 miles to Liverpool with good profits to the makers by their own confession.

Steel rails are protectionized at present to the extent of $17 per ton, formerly $28 per ton. Fortunately, we have at present a competent National Labor-Commissioner, heretofore in the service of Massachusetts in the same capacity, Carroll D. Wright, who has just made a Report to Congress on the comparative cost of producing steel rails here and abroad. The following table is national and official and indisputable. It shows the Element of Cost in one ton of steel rails in Eleven distinct establishments, the first Two being located in the United States, the next Seven in countries on the Continent of Europe, and the last Two in Great Britain. The first column gives the Cost of the Material in the several districts, the second the Cost of Labor, and the third the total cost of the rails.

+-----------------+-------------+-------------+-------------+
| Distinct | Materials. | Labor. | Total Cost. |
| Establishments. | | | |
+-----------------+-------------+-------------+-------------+
| 1 | $21.10 | $1.54 | $24.79 |
| 2 | 25.11 | 1.38 | 27.68 |
| 3 | 17.67 | 1.04 | 19.57 |
| 4 | 18.06 | 2.51 | 22.18 |
| 5 | 18.06 | 4.64 | 25.65 |
| 6 | 18.23 | 2.58 | 23.12 |
| 7 | 18.10 | 2.68 | 23.19 |
| 8 | 18.66 | 2.97 | 23.74 |
| 9 | 23.42 | 2.01 | 27.02 |
| 10 | 18.05 | 2.54 | 21.90 |
| 11 | 16.39 | 1.36 | 18.58 |
+-----------------+-------------+-------------+-------------+

The reader who knows how to read between the lines will observe the strong confirmation of this table to the point already made in these pages, namely, that the "pauper labor of Europe" costs much more at a given point than the more highly paid labor of England and the United States. Thus: the average Cost of Labor in a ton of rails in the two latter countries is $1.70; the average in the seven Continental countries is $2.63. The average total cost per ton in the nine foreign countries is $22.77; the average in the two establishments here is $26.23. It must be remembered, that the cost of the material and of all the processes of manufacture here is greatly enhanced by the device of the tariff-taxes: still the difference in cost is even then only $3.46 per ton greater than the foreigners' cost: considering that these foreign rails must be carried 3000 miles over sea, how comes it that a tariff-tax of $28 or $17 per ton is needful in order to foster rail-making in this country? Take off all the tariff-taxes the rail-makers and transporters have _to pay out_, and could they not well forego the additional taxes they now impose on their fellow-citizens? Is there anything anywhere in the natural costs of Materials and Labor here to put American manufacturers at any disadvantage in their natural lines of business as compared with foreigners in _their_ natural lines of industry?

Fallacy F: _that artificial tariff-burdens placed at one point may become a compensation for other such burdens placed at another point of the same general line_. This fallacy has been luridly illustrated in this country since 1867, when in the Wool and Woollens Tariff of that year additional protectionism was accorded to Woollens ostensibly to compensate the manufacturers for protectionism then first accorded to raw wools. For a number of years the woollen manufacturers had succeeded in persuading the wool-growers not to demand of Congress tariff-taxes on raw wools, thus publicly confessing that such taxes raise the prices of materials to the manufacturers thereof. But the wool-raisers argued naturally, if protectionism be good for woollens, it must also be good for wools; the truth was, it was equally baneful to both, and to every other beneficiary of it in the long run; but the wool-workers had no answer to the simple logic of the wool-growers,--they gave their case away when they alleged that _they_ could not live without government aid,--and so they were obliged to surrender to their already angered brethren of the fleeces in 1867, and higher tariff-taxes were put on the woollens in order to compensate the manufacturers for the anticipated rise in the price of wools. Of course it was supposed that the patient people would bear the now doubled burdens put upon them by _two_ privileged sets of their fellow-citizens. If protectionist taxes made the manufacturers rich, why should they not also enrich the rural herdsmen? In short, why may not such taxes make everybody rich?