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NATURE AND EFFECTS OF A PROTECTIVE TARIFF.
It is obvious to all reflecting minds, that ry advantage derived through the operation under the present tariff we are importing of the tariff
. This can be easily stated and foreigu goods to an excessive extent. The illustrated. It is, that foreign States, in drain of specie from the vaults of our banks, some degree, actually and substantially pay which is now going on in consequence, our revenue. But how is this effected i It is would most certainly produce a financial thus : Suppose the revenue necessary for the crisis, bringing ruin upon thousands, were it support of the Federal Government equal to not for the supply of gold from California. $25,000,000, (costs of collection, &c., incluThis is putting off the evil day, but for how ded:) this sum must be raised in either one or long no one can predict. As it is, others the other of two ways, viz., by direct taxaare taking from us by this system nearly all tion, or by duties on foreign commerce : if the advantages we so eagerly expected from by the former, then it is certain the governour rich Pacific possessions. We are merely ment costs the people that sum, precisely; becoming the shippers of the treasures of but if by the latter, then the question is, that region for our more sagacious European Have not foreign countries paid a part of rivals.
the amount? Doubtless they have; and Under these circumstances we will be let us see by what process. Keeping in excused for again presenting in the simplest inind that twenty-five millions are to be form another argument
for protection to our raised-suppose we were at any time withown industry in all its forms.
out a tariff, and that foreign goods could be A tariff founded on constitutional author- bought in our markets at certain rates--any ity, and at the same time wisely modified you please : for the time being the people by all the necessities of the country to pay the whole twenty-five millions, and buy which it can apply, is a measure that cannot their goods at the rates that may be : supbe successfully assailed. Some system of pose now that subsequently it is thought fit taxation must exist for the support of gov- by government to levy a tariff of twenty per ernment; and none has ever been devised cent. on all foreign goods sold in our marso faultless or so fit as this. Under its ope- kets, and which duty would precisely meet ration taxes are levied upon the people by the expenses of government, to the entire their own voluntary action, and thus, as it relief of the people from direct taxation : in were, by an invisible and unfelt agency; this case, and by the operation of settled and the costs of collection have been esti- law of trade, the duty of twenty per cent. mated by high authority at one fifth only levied upon the foreign goods would not be of the costs that would be incurred under a added to the price which our citizens would system of direct taxation. Thus, whatever be required to pay for them, but some is paid, is paid with the greatest possible smaller amount." The sum of twenty per convenience to the citizen; and the amount cent. above the previous cost would be dipaid is less than it would be under a system vided between the seller and the purchaser, of direct taxation by four fifths of the costs the seller losing (it may be) five, and the of the collection of the revenue under that purchaser fifteen of the twenty per cent. system.
Now, each party losing in his respective These premises are beyond the reach of proportion, the purchaser three fourths and material objection; and if true, there can the seller one fourth of the twenty per cent., be but one rational opinion as to the expe- which in the aggregate make up the twendiency of the tariff system.
ty-five millions, it is obvious that the citiBut there is a further and direct pecunia- 1 zens of the country pay only eighteen VOL. VIII.
and three quarter millions, and the foreign it. By the operation of the law the GovStates the remaining six and a quarter mil-ernment has lost nothing—the citizen has lions, which are made to the country by the made twenty-five cents, and the foreigner transaction.
has lost as much ; and all has been done Perhaps some would say that, notwith- without the smallest injustice to any one. standing the apparent advantage to the Neither can it be said that the restraint country which this estimate exhibits, there of the tariff on commerce curtails the enis ultimately and substantially no advan-joyments of the people by effectually curtailtage ; since the gain of six and a quartering the means of enjoyment in raising primillions on the one hand is rebutted by the ces: because the means of enjoyment are restraint inflicted on commerce on the other. equally as great as (even greater than) beBut is the objection sound? Let us exam- fore; inasmuch as the people gain somewhat ine and see. The facts are these : Duties from the foreign States by the transaction, are laid on imported goods at twenty per after both supporting government and buycent. to the amount of twenty-five millions : ing the same amount of goods as before. to obtain this revenue the country pays fif- Again, it may be said, if, (according to the teen per cent. more on the price for its foregoing hypothesis,) while the price of goods--an increase equal to eighteen and foreign goods is raised by the operation of three quarter millions. Now, the eighteen the tariff
, the rise in price is more than comand three quarter millions are the measure of pensated by releasing a greater amount in the restraint on commerce: strike the balance, the form of direct tax; why is it that the and the country stands benefited by the trans- foreigner has been forced to receive less for action six and a quarter millions of dollars: the his goods? The ability of the country to restraint on commerce answers to only three pay for them being undiminished, and the quarters of the relief from direct taxation ; supply remaining the same, why should the the remainder of that relief is so much clear goods be sold lower? The following explagain. To illustrate more familiarly : Sup- nation may suffice: When the citizen is dispose that without a tariff an individual were charged from direct taxation, the amount
the Federal Government $1 revenue that he would otherwise pay to the Governper annum, and at the same time paid for ment remains in his own coffers, at his own hats of a certain description at the rate of absolute control and disposal. He is not $5 each: now, suppose a tariff of twenty obliged to invest it in one commodity more per cent. levied on foreign goods; this on than another. It retains the general charthe foregoing hypothesis would remove the acter of his private property, and he regards direct tax, and would raise the price of the it only in that light. Suppose him now to hat seventy-five cents only. How, then, go to a merchant to buy goods : suppose would the parties stand ? They would stand the merchant to inform him that the goods thus : The Government would receive the which he wants have risen fifteen per cent. ; same revenue as before, and the citizen as would he be influenced in his purchase before would wear his hat; but the tariff by the consideration that the tax which he would have the effect of compelling the before paid was in his pocket! Not one foreigner to pay twenty-five cents of the cent more than if he had made the amount dollar which the citizen paid before. of his tax-bill by a bargain on the road; No tarif.
and that would have no appreciable effect. Hat,
Men are not governed in their purchases by Direct tax, Direct tax,
such motives; but they look to the relative
value of commodities in general, and if an Total, Total, $5 75
article rises in relation to other articles in From this statement it is obvious that general, (whether from natural or political the Government receives the same income causes,) they will buy in some degree the with or without the tariff
, (supposing costs less of it. If corn, bacon, &c., remain at a of collection , &c., equal in each case,) while fixed price, and the price of flour is doubled, it is equally obvious that the tariff has it needs no demonstration to prove that less saved the citizen twenry-five cents, which flour will be used than before, and this he paid before, by making the foreigner pay | whether the rise is the effect of a tariff or
other cause. Here, then, is the inducement importation from England bears to its whole and necessity for the foreign merchant to previous amount, but by the diminution of lessen his profits (under the tariff) as strong England's total demand for the articles which as in any other case—notwithstanding the we produce and exchange for her fabrics. fact that in this case something from the Here seems to be a principal
, if not the only very nature of trade is made to the country ground of error on the subject. by the action of the system.
Still, supposing there is more in this Let us now examine its effect on the value abstract objection than has been allowed, is and amount of home production, for this is there not great reason to suppose that it is an important department of inquiry on the more than neutralized by the consequential subject, and should be well considered. advantages which flow from the system in How can it affect us in that quarter ? In other directions ? Must we not allow it to the following manner: Suppose England to be a matter of much moment that this sysbring goods to the United States, during tem, by transferring a large body of our any year, to the amount of twenty-five mil- population from the field to the loom, diminlions, for which she finds a market by taking ishes the amount and augments the price of in return the raw material, &c., which are our agricultural products, while at the same produced here : suppose, also, that the next time the condition of the new manufactuyear a tariff of twenty per cent. is levied rers is improved ? Is it a small matter, that upon her merchandise by the Government of by encouraging and extending domestic the United States : it cannot be denied that manufactories, and thus increasing competithe tendency, at least, of such increase of tion, the prices of goods are lowered! Is duty is to diminish importation. The im- the augmentation of our national independportation being diminished, and the foreigner ence and security, by manufacturing within less able to buy, the demand for our domestic our own borders all articles of prime necesproduce is diminished, and, cæteris paribus, sity, a matter to be despised! These adits price must fall. Here an evil result seens vantages are manifest results of this system to be fairly made out, though very indefinite --results promised by reason and exhibited in its character. But is it not very manifest, by experience--and (leaving wholly out of that though an evil
, it must be extremely, view the estimated national gain of six and if not insensibly small ? Say that one a quarter millions by its operation) these thirtieth part of the exports of England is advantages must, in the eye of reason and absorbed in our markets; that the imposi- true policy, far, very far outweigh an objection of the tariff diminishes their importation tion which exists almost, if not wholly, in one twentieth of that amount, (which is per- abstraction. But, again, take it for granted haps much more than facts warrant us to that our exports are lessened by the operasuppose :) then the total demand will be tion of the tariff, and that therefore the diminished by the one-six hundredth part of price of domestic productions is reduced : its original amount, only. Now, if such a what is the tendency of such a state of diminution of demand will affect the price things? Why, the very ground on which of an article, (as by the principle laid down foreign commerce is reduced, is that on which we must allow,) how much will it affect it? pari passu domestic manufacture is augSuppose a farmer, who in 1849 bought six mented. And what is the effect of the hundred yards of osnaburgs for negro cloth extension of manufactures, if it is not to ing, finds himself in 1850 in need of only increase the demand for and raise the price five hundred and ninety-nine yards: how of the raw materials, the productions of much would he expect the merchant to fall the country, whose price had fallen from the in price for the decrease of the demand ? check given to foreign demand by the tariff The principle could not apply practically in (according to the hypothesis)? It is obvious such a case, while as a mere abstraction we that if the demand for our productions in must admit it. And similar is the case diminished abroad, the very reason of that between the United States and England. diminution will increase the demand at We must not estimate the decrease of de- home; and, cæteris paribus, the demand mand in England for our cotton, &c., by the being increased, the price is increased, (surely proportion which the diminution of our in this case, if in the other. The whole matter is then reduced to this one point, viz., senue. He has not ordinary perception who whether the increase of demand at home is cannot see this. Now the Federal Legislaequivalent to the decrease of foreign demand; ture in 1842 did--what? For the purpose and who can show that it is not ? Say the of raising revenue, they, in their discretion check on our importation is an evil, and that as to both the subjects and the rates of duty, the stimulus which it communicates to home laid a tariff on foreign merchandise. Did industry and the price of home productions they not then act in most implicit obedience is, on the other hand, an advantage: do not to the Constitution ? The Constitution did the evil and the good appear upon mere not require that the Legislature should or inspection to be correspondent? Do they should not have other objects associated not appear, so far as things so indefinite in with that of revenue ; but it it legalized an their nature can be scanned, to be proxi- object by the execution of which another mately, if not exactly equal ? Such is very might be attained, (no other law prohibiting) strongly the appearance; and if true, then all then it legalized the latter also: and this the other advantages before enumerated are conclusion is inevitable; for the Constituso much clear gain—the ill effect of the tion, leaving the Legislature at large as to system on home production in one way, both rates and dutiable articles, gave them being counteracted by a corresponding ad- power to establish any: the Legislature vantage in another.
choosing the protective rates, &c., are thereBut the feature of this system which, in fore within the Constitutional power. Take its present modification, is most odious to its an illustration : Suppose the Federal Govopponents, is the protective policy which it ernment should determine to enlarge our embodies. While on the one hand it is navy by the addition of twelve ships of the admitted that the Government may consti- line, and should authorize its agents to emtutionally levy such duties on foreign com- ploy mechanics to build them: now supmerce as may be necessary for its support, pose these agents who have this authority it is wholly denied on the other that such (the sole assigned object of which is the duties may be so laid as to afford protection building of the ships) should, in contracting to our own domestic manufactures. Let us with builders, associate with the leading fairly consider this objection, and see whe-object (the building of the ships) the addither it is founded in wisdom or in sophistry. tional and humane object of letting the Upon what is it based! Upon the assump- work to certain applicants, who, while equally tion that the Federal Constitution author- as skilful as others, had the misfortune to be izes a tariff for revenue, and for revenue extremely poor; and suppose they should only; and that the present tariff, being as act under this motive: will any man say certainly a protective as it is a revenue that this would be transcending authority? tariff, (protection and revenue both being ob- Surely not; and still this is a parallel case jects of the measure,) it is therefore, quoad with the other. Suppose also (as we reasonthe protective feature, without constitution-ably may) that the tariff of 1842 was laid al authority. It would be unreasonable to precisely as it was, but that the object of suppose that an objection so popular would protection was not in the mind of the Lefail to be specious; and specious this is; gislature when it was laid ; or that it was laid but it is only specious. It is certain that with an eye to revenue only, and otherwise the Legislature can lay duties for revenue. wholly at random: would not the effects All admit it. And is it not certain that the have been precisely as they were ? and would Constitution does not impose upou it a single it not be constitutional on the very ground restriction, making any article of commerce of its opponents ? Most unquestionably; more or less dutiable than another, or limit- and if so, what should we think of the Coning in any manner the rates of duties? All stitution in reprobating a cause without any this is certain. And what does this grant reference to its practical effects? This may of power, thus unrestricted as to both the not be political abstraction in the eyes of subjects and the rates of duty, amount to ? some; but that it is a distinction practically Why, most palpably to a discretionary power immaterial, no man can doubt. to lay any duties on any articles of foreign It has been objected that a protective commerce whatever, in order to raise rev- tariff is of unequal operation; that it fills the pockets of the Northern manufacturer, and defense; and these articles are ever and empties those of the planter of the varying with times and circumstances. The South. But though it must in candor be enlightened wisdom of the Federal Legislaadmitted to be unequal in its indirect effects, ture, then, is probably a sufficient guarantee yet who would have the temerity to con- that such modifications of the tariff will be demn a measure for an imperfection no successively adopted as the condition of the greater than this, when compared with the country shall from time to time indicate to great extent and variety of its advantages ? be proper. It protects the agriculturist and the manu- it has been alleged in objection to the facturer, the whole country over; and these tariff
, that in encouraging the establishment are the principal departments of industry. of large manufacturing communities, its efThat its protection should be precisely equal fect is demoralizing and mobocratic. But to all, could not be expected; it is not in the how can that be? The answer would nature of things that it should be so. Nor probably be this. That'the laborers in such would the operation of a tariff, however establishments are collected from the lowest modified, be precisely and universally equal. walks of life, and are, therefore, the most And why is it that the common experience ignorant and the most vicious members of of men does not teach them this? If a society; that, being brought into contact in bridge is to be built, or a road to be opened large bodies, their vicious propensities by in one of the counties of Virginia, (a matter union (like alloyed metals) acquire a power of familiar occurrence,) though the bridge greater than the sum of their individual or the road may be of use to only a small powers when separate; and that riots, mobs, portion of that county, yet do all the tax- and gross immoralities are the consequences. paying citizens contribute alike to its con- There is certainly an apparent force in struction. Now, what is this inequality in the objection, for it must be acknowledged the operation of the tariff but a complete that (cæteris paribus) vice concentrated is analogy to that manifested in the case of mightier and more mischievous than when the bridge or the road? Yet men speak of generally diffuused. But is it just to dethe one as iniquitous, and the other goes nounce such associations, simply because unblamed.
they are found to be connected with an evil Touching the attention that should be tendency ? or would it be the wiser way to paid to the description of foreign goods in inquire whether or not such tendency is adjusting the duties upon them, it is proper rebutted by equivalent or greater advanto observe generally, that the higher the tages from the same source? The answer comparative necessity of an article to the is obvious. The laborers that yesterday public security, the higher comparatively lounged in idleness along the streets
, withshould be the duty upon it, if the manufuc- out the means of life, or strolled over the ture of the article is practicable at home. country to procure by plunder the bread of Anti-restrictive writers on political economy subsistence, are to-day sent to a factory agree that the necessity of an article to the where they are put to regular employment, public security is, as to that article, good under the superintendence of men eminent ground of exception to the anti-restrictive for their integrity and business capacity. rule. To define exactly what is meant by Here they are paid for their services, and articles necessary to public security would are at the same time incidentally restrained be extremely difficult. Perhaps a definition from the thousand misdeeds of which idlewhich would be true at one time would not ness and want are the certain progenitors. be so at another. The condition, habits, and Yesterday they were without the restraint manners of a people are ever varying, and which rational control imposes; to-day they with them vary their necessities. Now, the are under its influences: yesterday they necessities of a nation being changed, the were in want, under temptations to falsearticles which supply these necessities are hood, robbery and murder; to-day their changed also; and these articles are neces- wants are removed, and they are delivered sary to the public security: for the public from their temptations. They cannot insecurity consists, in part, in the possession of dulge vicious propensities during the day, the necessary articles of ordinary comfort | because they are employed, and at night