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A M E R I C A N P ROT E C T I V E T A RI F F L EAG U E o ffers t o th e S t u
d e n ts o i S e nior C lasses o f C o lleges a n d U nive r s i t i es in t h e U ni t ed S t at es
a se ri es o f p ri z e
s f or app rov ed E ssay s on ,T H E A D V A N TA G ES O F A
P RO TE C T I V E TA R I F F TO T H E L A BOR A ND I N D U ST R I ES OF T H E
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U N I T E D S TA T ES
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e x ceed t en th o usa n d w or d s s ig n ed by s om e
o t he r tha n t h e w ri t e r s n a m e a n d t o be se n t t o th e o ffice o f TH E L E A G U
N o 2 3 W es t T we n t y t h ir d S t r ee t N ew Y or k C i ty on or bef or e M ay I
1 887 acc om pa ni ed by t h e n a m e a n d add r e
ss o f th e w ri t e r a n d o f t h e
C o llege t o wh i ch he bel on gs in a sepa r a t e S ealed e nv el o pe (n o t t o b e
o pe n ed u n ti l t h e s uc cessful E ssays ha v e bee n de t e rmin ed) m a rk ed b y a
w or d or sy m b o l c orr esp on d in g w i t h t h e s i g n a t u r e t o t h e E ssay.
A wa r ds wi ll be m ade J u n e l 5 I 8S 7 as f o ll o w s $
C om pe t in g E ssays
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An d f or o t he r E ssays dee m ed espec i ally m eri t orio us S I L V E R M E D A LS
o f ori g in al a n d app roved des i g n w i ll be awa r ded ,Wi t h h onorable m e n t ion
o f t h e au t h or s in a publ i c no t i ceo f t h e awa r ds
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T H E L E A G U E r ese rves t h e righ t t o publ i sh at it s o w n e x pe n se a n y o f
t h e E ssays f or wh i ch p ri z es a r e awa r ded a n d w i ll p rin t t h e E ssay
in g t h e fir s t p ri z e am o n g it s a nn ual publ i ca t ion s
,
,
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T he f o ll o w in g ge nt le m e
n ha
v e c on se n t ed
se rv e a
s J u dges
E x G ov H E N R Y M H O Y T P e nn syl v a ni a
H on G E OR G E H E L Y Oh io
Pro f V A N BU R E N D E N S L OW N ew Y or k
R OBE R T P P ORT E R D i s t ri c t o f C o lu mb ia
A M G A R L A N D I ll inoi s
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a n y fu rt he r in f orm at ion i s des ir ed please addr ess
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A D V A N TA G E S O F A
TH E
TO
TH E
L
T A RI F F
A BO R A N D I N D U S T RI E S
U NITED
TH E
OF
P RO T E CT IV E
S T AT E S
.
A m e ri ca n Pr otecti ve System may be advocated o n div e rs g rounds—eco n o m ic
po litical ethical The subject of this Essay however refe rs especially to eco n omic
con side ratio n s calli n g fo r a defe n se of the Protective T ar ifi o n the grou n d of its
TH E
,
,
,
.
,
,
ig h rates
of interest and wages—s o formidable that fi nally they became insuperable W ith he r
o r gan ized industrial syste m she was eve r ready to swamp ou r you n g manufactu res with
floods of cheaper goo ds a s h e did in
and in
I n 784 all Ame ricans w e r e
practically c omprised in two great classes — far m e rs and mercha n ts o r sailors $ So
u n duly was agricultu re developed that in 8 0 n otwithstanding the p r otectio n t o
m anufactures accorded by two wars there we r e fi ve pe rso ns engaged i n agr icultu re to
one in manu factu re l
$The tari ff h as changed that ratio until it is now only two to
There was thus a century ago no prospect of a symmetrical de v elopme n t of
ou r i n dustries a n d ou r future i n dust rial histo ry see m ed likely to be that of a n ag r icu l
tural nation
Such bei n g the t rend of our industrial developme n t what would be the effect o n
the w ealth of the natio n $ The answe r is manifest The exclusive prosecutio n o f
ag r iculture a n d co m merce— the development of two groups of industries instead o f
three — will be p r o fi table s o long as a n d n o longer tha n all that large agricultural s u
plus p r oduced by the applicatio n of all t h e lab o r a n d capital to the land will e x chan ge
m
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B olles I n dust rial H isto ry of t h e U nited States p 95
l D H Mason s Short Tari ff H istory of the Uni ted S t ates chap
1 M atthew Carey s New Olive B ranch 8
B a n croft s History of the Constitution vol
p 4 39
Commercial Statistics vol
p
HFourth Census i n M G g
l Compe n diu m of the Tenth C ensus pp 36 8 a n d 37
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P R O P OS A L
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de n ts
of
F0
A M E R I C A N P RO T E C T I V E T A R I F F L EA G U E o ff er s t o th e S t u
S e nior C lasses o f C o lleges a n d U niv e r s i t i es in t h e U ni t ed S t a t es
WI T H
COM P L
IME N
TS
OF
P ROT E C TIVE TA R IFF
A M E R ICA N
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a nn ual publ i ca t ion s
T he f o ll o w in g ge nt le m e
n ha
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.
s J u dges $
se rv e a
E x G ov H E N R Y M H OY T P e nn syl v a ni a
H on G E OR G E H E L Y Oh io ;
Pro f V A N BU R E N D E N S L OW N ew Y ork
R OBE R T P P ORT E R D i s t ri c t o f C o lu m b i a
A M G A R L A N D I ll inoi s
to
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a n y fu r the r in f orm at ion i s des ir ed please addr ess
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N ew $
E D WA R D H
A
,
E A G UE ,
o
rk
.
A M M I D OV
m
a
i
L
A D V A N TA G E S O F A
TH E
TO
TH E
T A RI F F
A BO R A N D I N D U S T RI E S
L
UNITED
TH E
OF
P RO T E CT IV E
S T AT E S
.
A m e rica n P rotectiv e Syste m m ay be ad v ocated o n di v e rs grou n ds—econ om ic
political ethical T he subject of this Essay howeve r refers especi a
lly to eco n o m ic
c on side rations calli n g fo r a defense of the Protective Tar ifl o n the ground of its
ad vantages to the Labo r a n d I n dust ries of the U n ited States
I pu rpo se therefore to show first how by a Protectiv e Tari ff the three gr eat gr oups
of i n dust ries — agricultural ma n ufacturi n g and comme rcial— have bee n developed i n d ue
propo r tio n and stimulated to yield a g reate r p r oduct of wealth ; seco n dly how this
inc rea ed p roduct of industry h as bee n distributed j ustly and to the advantage o f
the labo r which our i n dust ries e m ploy ; a d las t ly ho w the prosperity o f both the
labo r and the i n dust ries is bound up i n the continuance of t h is i ndustrial s ystem
To appreciate the adva n tages o f the T ari ff to ou r industries we must recall those
i n dustries a centu ry ago O u r early i n dustrial history is the history of a British
pla n tatio n Agr icultu r e a n d co mm erce were alo n e developed Ma n u factures we r e
n eglected T his disproportio n ate de v elopment of industry r esulted on the one hand
f ro m Engla n d s policy of suppressing colonial manu factures and of putting bou n ties
o n agricultural e x ports * and o n the othe r ha n d from the ch eapness o f land and the
desi re of the colonists to app rop riate it Afte r po litical i ndependence was achieved
industrial dependence continued E ngland st ro v e to keep this count ry still her
truck far m by the ty ra nn ous power of capital
B y he r n oto r ious indust rial
policy h e rende red those natural obstacles to the development of ma n u factu res— I
m ean the lack of m achinery the lack of skilled work m en the comparati v ely high rates
of interest and wages— s o fo rm idable that fin ally they became insupe rable W ith he r
o r gan ized industrial syste m she was ever ready to swamp our young manufactures with
floods of cheape r goods a s h e did i n
and i n
I n 784 all A m ericans were
practically c omprised in two great classes — fa r me rs and m erchants o r sailo rs $ So
unduly wa ag r iculture d eveloped that in 8
notwithstanding the protectio n t o
m anufactures accorded by two wars there were fi ve pe rso ns e n gaged i n agri culture to
one i n manu factu res $ $The tari ff h as cha n ged that ratio until it is now o n ly two to
o n e $ $ T here was thus a century ago n o prospect of a symmet r ical develop m ent of
ou r i n dustries a n d ou r future i n dust rial histo ry seemed likely to be that of a n ag r icu l
t ural nation
Such bei n g the trend of ou r indust rial de v elopme n t what would be the e ff ect on
the w ealth of the natio n $ The answe r is manifest The e x clusive prosecutio n o f
ag riculture a n d com me rce — the development of two gr oups of industries i n stead o f
three — will be pro fi table so long as and n o longer tha n al l that large agricultu ral u
plus p r oduced by the applicatio n o f all the labo r an d capital to t he land will e x change
TH E
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,
Bolles I n dust rial H isto ry of t h e U nited States p 9 5
l D H Mason s Short Tari ff H istory of the United S t ates chap
1 Matthew Carey s New Olive B ranch 8
Banc roft s H istory of the Constitution vol
p 4 39
Commercial Stat istics v ol
p
HFourth Census i n M cG r eg
i Compe n diu m o f the Te n th Ce n sus pp 368 a n d 37
’
,
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‘ ’
.
.
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1
passim
.
1
2
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.
31
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.
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2
in E uropea n markets fo r the products of manufacturing industries While this power
to e x change lasts buying manu factures would be cheape r than making them ; the
ma n u factories could j ust as well be abroad and the m ax imum of wealth could be pro
d ced by devoting all the labor and capital to only two f the three great groups of
indust ries or sources of wealth
T he advantage of th at marked tendency that characte rized ou r early indust r ial
history depends the r efore o n a simple question of fact Is th ere a foreig n market for
the surplus product of A m erican agriculture whe n all the labor and capital is e x erted
on the land Now how stands that fact Never in the history of this country h a
there bee n a m arket for the surplus product o f America n agricultu re when all the labor
a n d capital is exerted o n the land As C olo n ies we had no ac ceptable produce to o ff er
England for all the m anu factures that we needed * Every yea r the balance of trade
went heavily against us The di ff erence was paid by m ortgages on plantations * The
O pening of t h e ports in
784 was followed by a n i n u n dation of cheap manufactures Ag ri
cultu ral p r oduce rotted n the hands of the farmers and was as v aluable as stones $
E nglish facto rs a n d agents collected the debts by s h e ifi sale s $ I n 79 Hamilto n
in h is Report on Ma n u factures declared the foreign market altogether inadequate
While the wars of the F r ench Revolution opened to this country profitable markets
for agr icultural products the r e was n o surplus wasted B ut on the opening of the
po rts in 8 5 the experience of 784 was repeated $ After the Napoleonic wars Eu ro
pea n n ations could feed themselve s $ That agricultural produce is too abundant in
the United States for the m ar k ets at home a n d abroad is a fact that cannot be disputed
for a m ome n t said Matthew C arey i n
I n 8 4 A n drew J ackso n asked
Whe r e h as the Ame rican fa rm e r a m ark et fo r his surplus products $ H
A little consideration of the nature of foreign trade will e x plai n the r easo n for th is
li mit to the fo reign m arket T he val ue of ou r agricultural surplus depended e n tirely
o n the fo reign dema n d W he n that demand ceases the surplus is wor thless The
e x cha n ge between E urope a n d Am erica was one of food and raw materials for
fi nished goods —an e x change of ag ricultural commodities fo r manu factured c mmo di
ties A m e rica could ce rtainly impo r t from E ngland no greate r value of manu factu red
commodities than s h e m ade a return for in agricultu r al com m odities Commodity for
co mm odity is the only permanent basis fo r a foreign exchange Reciprocity is the
ulti m ate law Gold and silve r bullio n have but little importance in foreig n trade
T r ade is ca r ried on by bills of exchange to pu rchase commodities ; and whe n a natio n
begins to e x port bullio n largely trade will soo n stop I n a trade then between
E u r ope a n d Ame rica the value of all the manu factures that could be obtained from
Europe was limited by the value of all the agricultural products that could be sent
there How large the n can that foreign m arket be
As far as the expo r t of food
stu ffs is concerned the market is limited by the number of foreign consume rs This is
it utmost limit ; but it will be fa r less than this because foreign countries have other
sources of supply I n the same manner the demand for raw materials will be r egu
The value o f the Ame rican agricultu ral surplus it thus appears will depe n d a
lated
much o n the n atu r e of the p roducts as o n thei r quantity From Europe America can
buy co m modities only to the value that s h e gives in retu rn acceptable co m modities
A m e rica may have many commodities that E urope does not want
These considerations e x plain the reaso n why in ou r early indust rial histo ry all the
We find that the sa m e limit to the foreign
agr icultural surplus was not salable
I
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Gee on T rade See Thompson s Political E cono m y p 34
Histo ry of the People of the
M c M as t er
1 M aso n s Tari ff H istory chap
U nited States vol
p 55
p 55 ; also Mason chap
t M c M a t er vol
Taussig s Protect i on to $ oung I ndustries p 8
II M Carey s New Olive B ra n ch passim
1 $ oung s National Economy p 79
M Carey s Address to the Far m e rs o f the U n ited Stat es 8
C oleman Letter
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m arket exists to day
Agriculture fu rn ishes seventy t h
Agricultural commodities are there fo re our chief purchase money B ut to w hat
amount can we export them Statistics show only to about the amount of
— the value o f our agricultural exports for 886
No r ca n we hope to have a much
large r market For in 88 our most advantageous year we exported only abou t two
h undred millions more t The reaso n for this limit to the foreign market is obvious
E urope is supplied by othe r fields than those of the United States A merican wh eat
m ust now compete i n Mark Lane with the wheat of Russia India Australia and South
America The Chie f of the B ureau of Statistics in his last report calls particular
\Vith such a competition is it at
attention t o t h i increasing foreign competition $
I have now I con
all unnatural that the foreign market should b e g eat ly limited $
e ffectually banished the delusion of a boundless foreign market ; and I have
c eiv e
s h own that there never can be a market for all our agricultural surplus if all the la b o r
Let us n ow e examine ou r early industrial state
a d capital are exerted on the land
The existence of a glut in agricultu ral produce mani festly proves that too much
labo r and capital are engaged i n agriculture Unless then the growing population
I m mi
was diverted from the soil a continually increasing glut would be the result
and the growth of populatio n would cause not mo r e wealth but more waste
g rat i
I f then all the capital and labor were to be employed most productively they m ust
It is perfectly true that if population would n ot multiply
e ngage in other industries
and i f immigra n ts would not come there might result no overproductio n B ut the
fi rst of these suppositions is of cou rse absurd and the second is i mpossible ; fo r
wealth wa not the sole ob$ect that brought men to America and the fi rst settle rs of
this country were not economic men Unfo tunately emigrants came here from
E urope without fi rst ascertaining whethe r they were needed in America to supply
E urope with food It is also perfectly true that the American supply of agricultural
produce might be prevented fro m e x ceeding the E uropean demand i f the labo r and
capital were to be put on half time o r if only a part were to be employed B ut
t hen all the labor and capital would not be fully employed unless indeed there were no
other industries W e had then this state o f things unde r free foreig n trade O f the
three great groups of industries — agricultural commercial a n d m anu facturing — nly
t wo were bei n g developed
Ag riculture furthe r more engaged m ore labo r a n d capital
t han it could profitably employ
I f then the manu facturing industries could e n list the e n ergies of the su r plus cap
i tal and labor then unless those industries were speedily developed the capital and labor
of the nation would not be employed most productive ly the exclusive developme n t of
nly two groups of industries would n o longe r yield the maximum of wealth
That this labor and capital so rapidly m ultiplying could have fou nd employ m ent in
ommerce will appear impossible on consideratio n of the fact that t h e C mm e ial
industries having bee n always free to all and not having been suppressed b England
m ust have att racted all the capital and labor that they were able to employ T he
existence of the agricultural glut shows t hat there were yet a surplus of capital and
labo r It therefore follows that if all the capital and labor were to be employed most
productively they must engage i n manufacturing industries
I shall now S how at some lengt h why unde r free trade m anufactu ring industries
ould n ot have bee n developed ; and the n by showing that the Tari ff h a developed
those industries at the expense of neither the agricultural no r the commercial I S hall
prove that the Tariff has increased the gross product of industry
I t is c ertai n that manu factures could always have profitably employed the capital
an d labo r not needed in agriculture
That manu factures could become a source of
wealth to the n ation has certai n ly bee n proved by our subsequent industrial history
O f course manu factures would p rove unprofitable if at the start they were required to
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These figures are all taken fro m the Report of B ureau o f Statistics
R eport f Bureau o f Statistics
p 3
88
Re port of B ureau of Statis tics 886 p 5 8
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.
4
endu r e the fierce competition of foreign indust ries because under free t rade as I s hall
soon show they never could h aVe been developed But granted the possibility f thei
continued development would not the capital and labor engaged in them p oduce
T h e requisites of production
wealth
says M ill are two — labo r and appropri at e
natural objects America had both of these requisites in abundance The existence
of the first requisite is proven by the agricultural glut the e x istence of the second b y
the most hast y inventory of the nation s resources There would be no lack o f food f
labore rs ; because under free trade there was always a plethora There would be n
lack o f raw m aterials because a whole continent could be devoted to their produc
tion There were bottomless m ines and boundless forests There were measu reles
coal beds a n d countless streams T he forces of nature were ready to c —operate with
man I f n ow it b e contended that the su r plus labor and capital finding agriculture
unp rofitable would have withdraw n from it n aturally that a continued glut of agri
cultural p roduce would have been an impossibility ; that this labor and capital would
have
n aturally engaged i n manufacturing industries ; that these i n dustries
would thus have sprung up spontaneously $ I reply in the fi rst place that as a matte r
of history while free trade lasted the glut lasted and that this was no more than a
natural result i n the second place that as a m atte r of history w hile free trade lasted
the r e were no manu facturing industries and that this too was no more than a natural
result I shall n ow develop these points somewhat in detail and ascertain fi rst
whethe r capital and labo r would have withdrawn voluntarily from agriculture secondly
w hether if capital and labo r had engaged i n m a n ufactures u n de r free trade those i
d us t ri es could ever have bee n developed
The glut in agricultural produce was of course atte n ded by a fall i n p rice B ut
it can o t b e conceded that o n this account the Ameri can farmer would have lessened
It is per fectly true that the price of produce i n Europe must be high
h is prod uction
e n ough to repay the American fa rm e r for bringing la n d into cultivation ; but whe n
p roduce fell below that price he would not n ecessarily lessen his production Fo r it is
one thing to prepare lan d fo r cultivation a n d another thing to cultivate it To bring
lan d into c ultivatio n requires the invest m e n t of capital to clear the land and prepare it
fo r tillage Th is capital thus becomes fix ed an d cannot be wi thdrawn B ut to culti
vate la n d r equires the invest m ent of capital i n tools which cannot last long and in
labor which can easily be dis m issed This capital is thus circulating a n d ca n be
withdraw n readily Now take the case of an America n farme r I f three thousand
dolla rs m ust be expended by him to prepare land fo r cultivation and if two thousand
dolla rs and the labo r of two men a r e r equired to cultivate it then he would not bring
land into cultivation u ntil the price of wheat wa su ffi cient i n Europe to pay the in
B ut when his land is once n
t e es t n five thousand dollars and the wages of two men
de r cultivation he will not withdraw it so long a the price of wheat is su ffi cient to pay t h e
interes t on two thousand dolla rs and the wages f two men The export price of wheat in
consequence of overproduction might fall twenty five cents on the bushel as it has
done in the last fi ve years* and yet the farme r will not lessen his production He will
co n ti n ue to produce until the price falls s o low that it n o longe r yields the interest o n
two thousand dollars and the wages of two labo rers From this it appea rs that t h e
capital invested i n land could not have been easily extricated although America n
far mi n g became quite unprofitable and that a very co n siderable fall in price would
have been necessary before capital a n d labor would have withdrawn naturally from
agriculture B ut suppose th at the price o f p roduce had fallen so low that it no longe
replaced e v e n circulating capital o r suppose that the increasing capital and labor had
avoided ag r iculture and sought to engage in manufactures could these industries ha ve
bee n developed under free t rade $ I answer no That without the Tari ff we would
have had some manufactu res cannot indeed be denied but that under free trade we
would eve r have approached our present industrial eminence cannot be pretended fo r
an instant
Bureau o f Statistics 886 p 5
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I n the fi rst place this theory of the spontaneity of manufactures i in the words
refuted by all expe r ience ancient and m odern in all Countries
f Henry Clay
There is not on the face o f the earth a manu factory t hat h a not in some way been
Here free t rade should certainly take u p the
d irectly encouraged by government
burden of p oof because it maintains that that which has never happened in any
the case of the United States B ut
c ountry before or since would have happened i
it is easy to S how why without a Tari ff we neve r would have developed ou r m a fa
t uring ind ustries Suppose that u n de r free trade we had bought foreign manufactures
to the value of ou r acceptable products and then the surplus capital and labor had
undertaken to manu facture the rest of the desired commodities unde r Ameri can con
The manu factures o f E urope and the manu factures of America would then
d it i
be sold i n the same market Now such a system o f direct and indirect p roduction f
m anu factures would be mani festly impossible in the case o f simila r commodities The
d i ffi culty would arise fro m the di ff erence of price necessitated by the d ifle e t cost of
product io n That d ie e e consists chie fly in the one element o f wages
The wages of manufacturing ind ustries it is generally agreed were determined at
fi rst by the pro fi t i n fa r mi n g Until a man could earn more by e t e ing a facto ry b e pre
ferred to take a farm Now the pro fi t in farming depends on two elements the e ff orts o f
the farmer and the fertility o f the soil So great i n America was this latte r element
I n America therefore the cost o f
t hat a very slight e ffort brought a bou n tiful r eturn
production in agriculture wa small from the standpoint of the farmer s exertion and
I n E urope however where land was scare and less fruitful
wages were thus high
The European laborer must eithe r take
afte r cent uries of cultivation wages were low
the proffered wages o r starve The American labore r may become a land owner The
American manufacturer n ow starts his factory to produce the rest of the com m odities
necessary for the home consumption H e will then compete with the E uropea n
To attract laborers from farming
m anufacturer i n the productio n o f simila r goods
t h e American manu facture r must offe r highe r rewards than can be obtained o n the farm
To him the cost of production
a d to d o this he must adva n ce the price of his goods
m easured i n wages is high
B ut his E uropea n rival h a no such wages to pay He
does not employ men but hands
To h im the cost of production measured i n
The price of h is go o ds is therefore far less The American labore r
wages is low
for his part refuses to work for such terms a the E uropean laborer He prefe rs living
at ease owning his own land to toi ling as an industrial slave I f then the Ame rican
T he American article
g oods are to be made at all they m ust be sold at a higher price
B ut
a d the E uropea n article with di ff ere n t prices are now in the same market
there cannot be for the sam e article two prices in the same market The American
m anufacturer is therefore forced either n t to sell at all o r to se ll at great l oss
America n capital and labo r are in eithe r case ruined Unde r free trade the histo ry
f American manu factures is one continual history of industri al disasters
Wheneve r a n attempt was m ade by Americans to establish competing m a u fac
t ures the E uropea n Chiefs of Industry wit h t h ei half fed hordes r ushed in
to recon
Not able to satisfy the whole o f the American demand
q ue r the America n market
f r ma n ufactures England by sel ling large quantities at a loss prevented America
f ro m satis fying the r est o f that demand
E n glan d has eve r dreaded the day when
America n manufactories supplying the whole o f the home market would lesse n the
d ependence
of America Had there been no laws fo r the protection and encourage
m ent of manufactures , the history of those manufactures w ould have bee n one oft
ecurring cycle of eflo rt st ruggle and relapse Ou r present industri al structu r e would
b e a n industrial r uin
A n utte r apathy would yet hang li ke a pall over the mountai ns
f Pennsylvania and t he streams o f Connecticut
A nation of farmers reaping and
gathering into barns wO ld yet be dozing i n its Sleepy Hollows There would have
bee n no great industrial class wh ich continually toils and spins I t would have
remai n ed fo r generations yet unborn to ee Pittsburgh and J ohnstown and Lowell
a d Willimantic with their
tall chimneys smoking
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But the great men who stood at the beginning of our history comprehended most
tho roughly our industrial problem They determined to secure for this country t h e
maximu m o f wealth by the full employment of all the capital and of all the labor
Such was their purpose and to achieve it they saw but one means the protection and
encouragement o f manufactures
They were the great American economists fo r
they studied to increase the opulence o f the nation They believed that it was the
duty o f government to promote the general welfare
B ut o f that new Evangel
the Gospel o f Mammon whose leading text is L a e F a e loudly proclaimed b y
the E nglish apostles and devoutly believed by the American disciples those statesmen
had not heard $ et they had no idea of remaining idle whe n they had the means t
produce and the capacity to consume T h ey had no idea of postponing manufacturing
until interest and wages had falle n to the E uropean level They determined to rebe l
against the industrial tyranny as they rebelled against the political And on t h e 4 t h of
J uly 789 they declared their industrial independence by enacting the first Tari ff law
The advantages of the Tari ff to ou r m anu facturing industries are certainly ines
timable fo r to the Tari ff those industries now owe their e x istence The Tari ff fi rst
sheltered A merica n manufactures from the attacks o f B ritish capital and thus gave the
productive power of the n atio n a n opport unity to display itself The skill that was
essential to the establishment of manu factures could be acquired only a fte r years o f
experience The i n dustries required protection during the period of tuition W hen
once those industries were develope d there would r esult a g eate r and a cheaper pro
d uction Protection wa granted and the industries immediately prospered
Space permits n o attempt to trace that splendid industrial progress from the days of
Slater and Whitney and Lowell to the days of Baldwin and C orliss and Edison B ut
the results are indeed m arvelous W ere Alexande r Hamilton the prophet of P o t e
tion to appear among us to day and make a second report on America n Manufactures
he would beho ld a development of which he never dreamed He would ee the seven
teen branches o f manufactures that struggled fo r existence in his day increased i n less
tha n a century to more than three hundred ; he would s ee the vast laboratories o f
nature explored and the elements turned to the service of man ; he would s ee on all
our rivers those grand p alaces of the arts which fi ll the air with the h um of m yriad
wheels A stounded he would su rvey those busy hives o f industry — now the rivals
and soo n to be the v ictors o f their E uropean prototypes— Paterson the America n
Lyons Trenton the American B urslem Waltham the American Geneva and Phila
delphia the American Manchester$
A few fi gures from the census of 88 will S ho w how rapid has been the develop
m ent of the manu facturing industries I n the course of only thirty years from 850 to
there wa a gai n i the gross val ue o f the m anu fact ured products o f over 4 6 per
88
cent ; a gain in the capital invested of ove r 4 3 per cent ; a gain in the wages paid o f
over 3 per cent and a gai in the n umber of hands employed o f over 85 per cent
Thus the Tari ff by developing the manu facturing industries h a solved the great
industrial problem — How can the labor and capital of the nation produce the max imum
o f wealth I S hall now illustrate by a few statistics how by a Ta ifl we obt ain the maxi
m um f wealth to day * O u r total exports fo r 886 amounted to
O f this
consisted of agricultural p roducts
o r about 8
s m seventy three per cent
With these commodities therefore we obtain the desired foreig n commodities and ou r
imports furthermore are limited by these exports because we cannot buy more than
we can pay for We dispose o f ou r exports in the following manner $ Food stuffs to the
value of
are sent to Great B ritain and the Continent to exchange fo r ma n u
Beyond this amount E urope will take no food stu ff s fro m us because
fact ed goods
she h as other sources o f supply With E urope the balance o f trade is in ou r favor
She takes all the food that h e wants and is ready to give us an equal return i n manu
But we cannot im port manu factures from E urope to the value f
fac t ed goods
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T h ese figures are f rom the B ureau
of
Statistics
,
I
886
.
m
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7
because with the rest f the world we have an un favorable balance o f
trade ; for outsi de of Eu r ope we can sell no agricultural produce Our trade outsi d e
of E urope is in great pa rt one for luxuries and this adverse balance must be settled
with cash By bills of exchange on European bankers we pay this adverse bala n ce
with the favorable E uropea n balance Whe n this un favorable balance is pai d what
ever is yet d ue fro m E urope may be pai d by exports to this country of m anufactured
goods Now i n retur n for our
worth f food stu ff s we obtain afte r pay
ing the adverse balance manu factures of wool silk cotton iron and steel wood and
leathe r to the value o f only
T hese goods all compete with the products
of our protected industries This sum of
therefore r epresents what
am ount of manu factures we could obtain under free trade More than this we
could Ot obtain because Great B ritain and Europe want no more of ou r commodities
Now suppose we had free trade suppo se we had no protective industries to man fa
ture co m mod ities of wool silk cotton iro n and steel wood and leather ; suppose we
had Only
worth of those commodities how much less then would be the
wealth of the n ation $ How much less would our industries yield How m uch less a
value of n ecessary commodities would we have fo r the satisfaction of our desires $ The
gross product of all ou r manufactures is about
The census o f 880 put
it at
Now it is generally considered that the product of the protected
o r competing industries is about $
Under free trade therefore we would
be without this wealth For we are in the horns of a dilemma W e m ust either go
without these commodities or e lse make them since to have the commodities w e must
h ave the industries Under Protection we obtain manufactures ind irectly by e x change
to the value of
and by producing manu factures directly to the value o f
Ou r total consumptio n o f the products of competing manu factures
I f the n under free trade we could not produce
is therefore to day
the
worth of m anu factures because they are the products o f protected
industrie s how could we obtai n what we annually need fo r c onsumption— commodities
to the value of
W ill Great Britain and E urope se ll us manufactured
good s to the v alue of
for agricultural produce to the value o f only
Such a proposition is preposterous but free trade must maintai n it o r
admit that we would have less wealth O f the goods demanded fo r the American con
sumption but a very small fraction less tha n one eighth can the r e fore be obtained
from abroad Under free trade we would have onl y this fraction and go without the
remaining seven eighths Unde r Protection we ca n have the whole amount desired
I f u nde r free trade an attempt were made to buy from abroad and then to p r oduce
the remainde r at home there would be two prices for the same article i n the sam e
market which would be an impossibility T he price of the whole supply both domestic
and fo reign will be fixed by the price f that portio n raised at the greatest expense I f
the Ame rican manu facturer cannot get this price he will not produce the manu factures
and we go without the wealth I f the American produce r gets this price u nde r free
trade because the foreign manu facture r raises his price the n the Tari ff most cert ainly
does not tax the consumer A P rotective Tari ff simply increases the price of the fo r eign
a rticle to the amount o f the increased cost of production of the domestic article T h e
Tari ff thus compels the foreign and domestic article to be s old at the same price thereby
rendering prices stable for the home producer and fu rn ishing the whole amount desired
to the home consumer
The advantages of the Tari ff to the manu facturing industry are indeed evident
B ut have manufactures been developed at the expense of other industries $ I S hall
now show that manufactures are by no means parasitical bu t that the Tari ff while it
h as developed the manu facturing industries h as at the same time stimulated both
ag riculture and commerce
The advantages of the Tari ff to American ag riculture proceed f rom this that it
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8
substituted a domestic for a fo r ei gn market As a re ult f the Tari ff the factory
competes with the f arm f laborers and so attracts numbers from the soil The factory
removes those super fluous far m ers whose labor causes a glut and results not in wealth
b ut i n waste
T hu s the rivals o f the farmer in production become his consumers
The factory furt hermore h a attracted labor from abroad thus increasing the home
market O f immigrants the factory h a received fi f ty per cent more than the farm *
B ut this is not all Unde r Protection the farme r exc h anges his produce with the
domestic instead of the foreign mechanic This is manifestly t o the farmer s ad va
tag e ; for the domestic mechanic consumes the manu factures of othe r domestic me
h a i s who in thei r t urn consume the farmer s produce and thus incre a
se the
home market B ut the foreign mechanic c onsumes foreign manufactures and that con
f ers no additional be n efit o n the farmer
Thus has Protectio n substituted for the two
boasted markets of free trade— ne o f which is too small and the othe r too fl uctuating
—
e market at home which is more than twice as large as the foreign m a k et
d and
absolutely certain A home m arket benefits t he agricultural industries in most impor
tant particulars I n the first place it enables the land of this country t o be used i n its
most prod uctive manne r This free trade would prevent Whe n an agricultural
country exchanges with a manu facturi ng country it must w its lands to th se staples
which that country demands Thus we export to England to day only three vegetable
staples— cotton wheat and tobacco Now so long a the demand of a manufacturing
country is con fi ned to a few articles the prod uctive power of the agricultural country
must be diminished T he numerous varieties of soil and climate which characterize
this country are capable of prod ucing numerou varieties of c rops E very soil is m ore
productive when sown to one crop than to another But under free trade these
advantages are all lost The soils whateve r may be thei r appropriate cr0ps
must be diverted from their best use to raise those crops for which alone there is
demand Is not productive power thus lost To diminish cost of transportation those
crops a e exported whose density f value is greatest Land will be diverted from
the production of the more bulky yet more abundant corn to that of the more compact
yet scarce r wheat Then too the re is no demand for the perishable vegetables and
frui ts an d fro m their production the suitable lands m ust be diverted Above all the
co n tinuous demand for the same few prod ucts prevents any system of rotation f
crops and the absence of a certain and near market prevents any careful tillage and
leads to extensive instead of intensive cultivation Had America adhered to free trade
this m isappropriation of the soils m ust have inevitably resulted One fact will show
I n 77 nearly one half o f the
h w wasteful American agriculture might have bee n
value of all ou r exports consisted of tobacc o $ And had free trade continued we
would now be striving to monopolize the E uropea n markets divert ing all ou r land to
the production of wheat cotton and t obacco We would never have developed those
fourteen principal vegetable prod uctions and those orchard prod ucts that we
have t day $ T hese advantages to agriculture could only proceed from the creation
of a home market O n account of the physical properties of the soil there is s t ill
another reason why the home market is more advantageous than the foreign W hen
ag ricultu ral products are co sumed near the farm nitrogenous re fuse may be returned
to the so il B ut when those products are shipped to foreign markets there ca n be n o
such retu rn The soil is practically transported and lands lose thei r fertility The
Tari ff has prevented this earth butchery in the United States The advantages to
agriculture of a market for the surp lus is strongly a ffi rm ed by M r Mill
A country
he says will seldom have a productive agriculture unless it h as a large tow n pOp
lation or the only av ailable substitute a large export trade in ag ricultural produce l
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Tenth Census Manu factures p 6 Compendium pp 368 and 37
B ureau of Statistics Re port f 88 Census of Agr i culture 880 p
Macpherson s Annals of Comme rce vol
p 57
C om pendium o f the Tenth Census vol p 738
Polit i cal E cono m y book chap viii
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I be liev e b een thoroughly established that
B y a Protective T
w exi st abroad
a d does not
The arrival of manu facturers to u e M ill s expression has enriched the
at home
farme rs by the value o f the food that would not have been produced had t hose
m an ufacturers not been here to consume it or which would have been produced only
to rot in gra aries Nay more the factory has stimulated the farm to still greater
food
An incalc ulable ad va
efl
t to supply the co stantly increasing demand f
tage of the Tari ff to agriculture has resulted from the establishment in this country of the
mechanical arts T he methods f agriculture have been vastly improved since the days
when farmers plowed their lands with wooden bull plows sowed their g rain broad
cast cut it with a scythe and t hrashed it with a flail * Had we not fostered the
mechanical arts by a Protective Tari ff would the agricultural implements of Auburn and
Chicago be n ow acknowledged the finest in the world $ i Would American agriculture
have undergone that great revolution produced by American steam plows and stone
cutters and reapers and binders I n less than a century would the product per man have
increased fivefold 2 1 The history o f American agricu lture negatives such conclusions
Colonial agr iculture wa rude and exhausting ; for t h e fe t ili at i of the soil and the
rotation of t he crops were never practised $ A period of awaken ing followed the
Revolution and as agriculture unde r the tari ff s became more profitable it gradually
cam e to be studied a a science With the invention of M C mi k that science began
its ex traordinary development continually furthered by agricultural chemistry and
agric ltural machinery
The advantages of the Tari ff to the agricultural industries
m ay there fore be summed u p in the two words of Mr Mill —a m ar ket and tools
The Tariff h as therefore stimulated those industries and enabled them to y ield a
g reater product o f wealth
No r has a Protective Tari ff less stimulated the development o f the third great group
f industries — the commercial
Even if commerce meant no more than exchange
between different nations the Tari ff could not be charged with checking it to day For
I have show n that our exports are limited by the foreign demand and that imports in
t h e long run m ust ba
lance exports A Tari ff does not stop commerce Our commerce
would be but little increased were the Tari ff now removed There would be it is true
under f ree foreign trade a great demand in this country for foreig n manu factures but
t here would be no supply at the onl y terms we could o ff er
Where could we with only
ag ricultural products purchase by e x ch ange in foreign commerce manu factures to the
val ue of
B ut commerce does mean more than mere foreign trade
Commerce includes the home t rade as well Adam Smith the free trade patriarch
d eclared the home trade to be far more profitable than the foreign
H e says that if a
give n amou n t of capital purchases and interchanges good s within the sa m e country
that country will gai n twice as much advantage from that capital as if it had purchased
and interchanged an equal val ue of goods with another country For in the fi rst case
this capital encourages only one native i ndustry in the second two Moreover i n the
home trade capital circulates more swiftly When there fore an equal amount of capi
tal is employed in the home and in the foreign trade the first capi t al will be fa r more
e ffi cient and profitable tha n the second
; because it can e ff ect i n the same time and
with le s cost for insurance m any more exchanges than the second The Tari ff h as
c reated for the United States such a domestic or internal commerce
The Ta ifi has
stimulated commerce because it has e n abled the surplus product of the far m to find a
market at the adjacent factory O ur rail r ads and canals are th e commercial indus
t ries
Since this exchange of products between farm and factory h a become possible
internal commerce h a att ai ned mammoth proportio ns The capital invested in
ailroads is now one fi ft h of the nation s wealth T he m ileage is now equal to that of
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H istory of the People of t he U n ited States vol
t B olles Industrial H istory of the Unit d States p
e
t Tenth Census Agriculture History o f America n g ic lt u
B olles Industrial H istory f the United States p 4
M c M as t er
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all the rest f the world I n 880 our domestic commerce measured in the tonnage o f
the railroads alone wa more than twenty times as great as the foreign commerce *
To conclude the discussio n f the advantages of the Tari ff to the industries of t h e
United States let me summarize my argument Be g inning with that incontestable fa
ct
an unsalable agricultural surplus I have show n that i f our labor and capital were to be
fully employed that if we were to obtain the maximum o f wealth there must be devel
oped i this country the manu facturing industries I have sho w n that unde r free t rad e
their development was impossible I have shown that under Pr otection they have
been developed and that at the same time the agricultu ral and commercial i ndustries
have been stimulated I have therefore proved that the Tari ff has increased the gross
p roduct of ou r industries Under free t i ade ou r productio n of wealth was in great
part an indirect production W e produced the desired manu factured commodities by
exchanging others for them England balked us in all attempts at a direct produc
tion Ou r production was the r efore limited by the extent o f the foreign m arket f
our agricultu ral surplus That the people of this country desired to consume and had
the labo r and capital requisite to produce a far greater amount o f wealth than the y
could produce indirectly i n no wise enabled them to do
It is true that under free
trade a small eff ort would produce a greater amount o f wealth tha n a like efi t could
at first produce unde r P rotection B ut that e ff ort under free trade could neve r be
enough to satis fy the nat ion s desires Unde r free trade we could obtain a smal l
supply of m anufactures at a somewhat cheaper price ; but beyond that supply we
could obtain nothing Under Protection we obtain all that we desire at a rapidly
cheapening price Under Protection productio n can have no limit but the energies o f
the people and the r esources o f the continent
I pass now to the advantages of a Protective Tari ff to the labo r of the Unite d
States To appreciate the advantages of the Tari ff to the workingman we m ust recall
h i condition a century ago
D uring the early industrial period until the i t r d c
tio n of the factory syste m i n 8 5 there was properly speaking no great laborin g
class Laborers were then engaged eithe r in farming o r in occupations like that o f
the carpenter blacksmith and mason who render a kind of personal service and m ust
therefore be n ear the person fo r whom they work There wa no class that was
engaged in manu facturing for the manufactures consumed in America were produced
by foreign laborers The establishment in this country of the manu facturing indus
t r ies therefore required the creation f a great industrial class O f the state of t h e
lab orer in the early industrial period we have authentic accounts 80 miserable was
his condition that we can hardly understand how i n le s than a century his condition
could have been so ameliorated I n the fi rst place the general rate of wages was lower
by one hal f than at present i This is true notwithstanding the great depreciation o f
m oney Colonel \V ig h t t h e eminent statistician has traced the h istory of wages
from 75 to
The following table compiled f rom his work will S how how great
has been the rise in wages
86
786
B lacksmiths
667
Carpenters
538
Common unskilled labor
3
B ut we canno t understand how m uch lower wages really w re a century ago until
we learn that a working day lasted invariably from sunrise to sunset $ I t wa not
until 8 4 that the subject of shorte r hou rs was agitated and no reduction at all wa
made i n the hours of work u n til
Nor can we understand what was the real
position o f the laborer until we see how little his wages could procure A century ago
the American laborer had but few of those com forts that he eg a d a necessaries
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H istory f the People of t he U nited States vol
i M Ma t e
— 86
Historical
Review
of
Wages
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x
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M c M a t er History v 1
p 6 7
W righ t s History f Wages and Prices p 0
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Ma sachusetts and Great B ri t ain declares that although wages in Massachusetts are
the cost o f living is only about 7 per cent
7 7 per cent higher than in Great Britain
highe r than in Great B it ai xl
B ut besides this demonstration by Colonel Wright of the fact that real wages are
hig her in this country than abroad there are reasons why they are so and why the
Tari ff has been the cause The e ff ect of the Tari ff on the wages of labor is a problem
in the di tribution of wealth The problem is to determine how the Tari ff h a effected
e ach of the three shares — rent
wages and profits into which the gross product of
industry is distributed Free traders always discuss this problem a though the r e were
nly two shares in distribution — wages and profits Free traders assert that P rotection
raises profits and lowers wages B ut the re lation of the Tariff to rent the other share
in the distribution of wealth is unive rsally ignored and all the theories of free trade
oncerning the e ff ect of the Tari ff on pro fits and wages are consequently incomplete
a d erroneous
The real e ff ect of the Tari ff on the distribution f wealth can surely be
ascertained only when all the three shares are introduced into the discussion The
proposition that I wish to prove is that the Tari ff has so a ff ected the distribution of
wealth as to raise the wages of labor The argument that I S hall present has been
advanced by Simon N Patten P h D $Halle $ in a work entitled the Premises of
Political Economy it I refer the reader to this book where he will find the following
argument given more in detail To understand the true e ff ect of the Tari ff on wages
let us begin by examining the doctrines of free trade The stock argument of free
t raders when they attempt to deny the fact that Protection h a raised wages is the
following in the words f M r Henry George
I n what way can protective
t ari ff s a ff ect the distribution of wealth i favor of labor $
The direct object and e ff ect
of protective tari ff s is to raise the price of commodities B ut men who work for wages
are not sellers of commodities ; they are sellers of labor They sell labor in order that
they can buy commodities How ca n increasing the price of commodities benefit
them $ The fundamental fallacy in the free trade discussion f the relation of the
Tari ff to wages and prices lurks in the word commodities
D oes a P t e t ive Tariff
indeed raise the price of all commodities $ O f course the e ff ect of the Tari f is to make
the price of the domestic article at first higher than that of the foreign articl e with
out the duty Otherwise there would be no virtue in Protection But what a rticles
are those whose value is enhanced $ They have been throughout the whole of our
history with but few exceptions manufactured articles Undoubtedly so fa r as the
laborer consumes these articles his highe r wages are met by a higher price But man
fa t ed goods are not the largest item in the budget of the labore r
Fully two thirds
of the expenses of the laborer is for food alone E n gel s famous law of subsistence
asse rts that the smaller the income of a family t he larger the proportion spent fo r food
There being there fore in this country no ta x as f ee t ad e s are pleased to call it
upon the consumption of food we see the falsity f the assertion that if the Tari ff i
creases wages this does not benefit labor because the Tari ff at the same time increa es
$all $ prices
We are now ready to proceed f urther in the proo f that Protection raises wages I
m anufacturing i n dustries the wages f labor and the profit o n capital depend on the
value of the finished manu factures Th us in manu facturing cotton cloth wages and
profits m ust ultimately come out of the value of the cloth produced Now the cost of
prod uction of this cotton cloth will consist of two elements raw materials out f which
the cloth is to be made and food by which those who produce the cloth must be u p
ported The greater therefore the value f the manufactured cloth a com pared
with the value of the s taple and food consumed in its production the greater will be
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Wright s C omparative Wages and P rices
t W right s Com parative Wages and Prices
The Premises o f Political Economy $
t
Fundamental Principles of Economic Science
Protection o r Free Trade p
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p 43
p 56
B eing a R e E xam i nat i o n of C e rt a m
by Si m o n N P atte n P h D
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brought into cultivation and on the other hand agricultural produce may fall greatly
in val ue without any diminution in the supply Furthermore inasmuch a the best
l ands are occupied first and men afterwards proceed to that which is wo rse the point to
which the price of produce m ust rise be fore new land will be brought into cultivatio n
tends with the progress of society to become higher and higher A gricultural improve
ments lessen the cost of production on all lan d under cultivation ; they d not make
i t less di fficult to bring new land into cultivation
Herein is the di ff erence between
manufactures and agricultural commodities as regards the increase of the supply
The supply of manu factures can be inc reased at any time in proportion to the amount
f capital that may be invested
Each new manu factory requires no more fixed capital
t han did the one that preceded it
B ut i n a
griculture as I have shown the amount f
fixed capital necessary fo r increased production becomes greater and greater
M r M ill of course admits that agricultural produce is subject to the law of dimin
i h i g returns
B ut this law does not modi fy his theory of the value of agricultural
produce For he maintains that when lands of diff erent grades are under cultivation
t h e value of the whole crop is fixed by the value o f that portion raised on the worst
gr ade of land and as the value of this portion is d et e m i ed by the cost of production
t h e value of the whole crop is determined by the cost of production
I n stating the true conditions upon which land is brought into and withdrawn
f ro m cultivation I have shown the falsity of this theo r y that the price o f the whole
rop is determined by the cost of prod ucing that portion raised at the greatest expense
W ith the inc rease of population and the consequent increase in the demand for food
i t s price will rise highe r and highe r above the cost of production on the worst grade o f
land Before n ew land will be brought into cultivation the price of food must r ise
t hrough a constantly increa ing margin
Unt il the price of food reaches the point at
which ne w land will be brought into cultivatio n the val ue o f food is a monopo ly value
a value that is go v erned solely by supply and demand ; a v alue that has no r elation
whateve r to the cost of production We are now able to perceive another false
doctrine of the English theory of distribution Rent on Mill s theory is the surplus
a y po r tion of agricultural capital produces beyond what is produced by the same
amount of capital on the worst soil or under the most expensive mode of cultivation
which the existing demands of society compel a recourse to
Mill thus rea ffi rms
the dictu m of Ricardo that corn is not high because rent i paid ; but rent is paid
because corn is high
Mill maintai ns that rent can n ot ente r into the price of ag ri l
t u ral produce and that the price of produce would be the same even if no rent wa
paid B ut if the value of agricultural prod uce h a no relatio n to the cost of production
the r ent of the better
o n the worst la n d because o f limitations of the food supply
g rades of land cannot possibly be determined and rent may thus enter into the price
f agricultural produce
Le t us now return to Mill s contention that profits and wages are the leavings f
I f the value of food and raw materials depends solely u pon supply and
e ach other
dema n d and has no relation to the cost of production then a rise in wages would not
as M ill prophesied increase their value The r ise in wages would increase the value
of manufactures because thei r value is determined solely by the cost f their produc
Now inasmuch as food and raw materials are the commodities upo n the
t ion
approximation of whose value to that of manu factures the rate f wages and of p rofits
depends the rise of wages causing an i n crease in the v al ue of manufactures would
esult in a n increase of the marg in and therefore an increase in profits Thus D r
P atte n re futes the current theory o f distribution and no longer can i t be maintained
Profits and wages may both be made
t hat profits and wages displace each other
h igh by any policy that would increase the v alue o f manufactures as com pared with
the value of the p roducts consumed in their production I n the United States that
policy is a Tariff o n the importation of manu factures The e ff ect therefore o f the
This of o t e
Tari fi o n the distribution o f wealth is to increase profits and wages
—
b y decreasing rent
be
accomplished
only
in
one
way
B ut it must not be
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i magined that this suppressio n of rent has perated to the inj ury of the American
farmer Under our economic syste m the farmer h as bee n both capitalist and landlord
The Tari ff h a retarded the appearance f a distinct class of landlords Unde r f ree
trade an economic system would have been evolved that is best described by the word
The agricultural overproduction the waste f produce and the dis
absenteeism
would have
astrous cultivation that characterized our early industrial history
resulted i n the abandonment or forfeiture of farms and the disappearance o f the
typical American farmer Small holdings would then have been merged in rich landed
Thus
e states and to foreig n proprietors American tenants would pay tribute in rent
the period would have been hastened when the returns from the land would be no
longer increasing but diminishing ; when the land of America would no longe r yield a
proportional r eturn to increased applications of labor and capital Wages the reward
of labor and profits the reward of abstinence would thus fall as t h e price of ag r i l
t ural produce rose to a monopoly value and rent absorbed more and more o f the gross
p r oduce o f industry But all this h as bee n prevented by the Protective Tari ff The
Tari ff has protected the interests of both capital and labor I n behal f o f the A meri ca n
wo rkingman P rotection h as insisted that the laborer is worthy of his hire Protection
h as e nabled him to maintain a highe r standard of life and h a given him the O pp
a citizen of the
t
it y to develop in himself those qualities that are essential t
Republic
I have shown in the foregoing pages why a century ago our future industrial prog
ress depended upon the enactment of a Protective Tari ff I have shown how our ind s
tries have been developed and our labor benefited after nearly three quarters of a
century passed under Protection I shall now show why the prosperity of both our
l abor and our industries depends to day on the continuance of th is industrial system
It is impossible f ully to understand the consequences of a transition to free trade t o day
until we real ize that und er Protection the United States h a developed into a great
e conomic organ ism
B y this I mean that under Protection our system of producing
d istributing exchanging and consum ing wealth i a peculiar system entirely di ff erent
both from that which it would have been and from that which it would be under a y
t em of free trade
A single ill ustration will explain my m ea n ing I t is commonly
argued that if we had free trade the Western farmer would be able to exchange his
wheat for a much greater quantity of manu factured goods
To prove this propositio n
free traders single out some particular farmer and asse rt that u nder the Tariff he was
ompelled to buy h is goods at a price higher than that o ffered by the foreign producer
F r om this they infer that a change to free trade would greatly bene fi t farmers Now
it is perfectly true that if Farme r A were gr anted the exclusive privilege of free trade
h e could exchange his produce for more manufactures than he can now obtain from the
home manu facturer B ut does this prove that if the Tari ff were abolished all farme rs
in the alphabet could do likewise $ I f f ree trade were decreed the population would be
d riven to the land
Then would follow an agr icultural glut When in consequence of
the increasing supply the pric eof agricultural produce had fallen and when in couse
q e e o f the increased demand the price of foreign manu factures had risen — for
under free trade there would be no protective industries to supply the home demand
what I a k under these conditions would be the position of the American farmer $
Th is disastrous period of overproduction would ultimately be followed by the period
of landlordism The removal of the Tari ff would therefore result i n more than the
mere introduction of cheaper goods The abolition of Protection would be followed by
a transition to an entirely di ff erent economic eg im e Would all those who now satis fy
their desires by performing industrial f unctions have functions to perform unde r the
syste m of free t rade B y no means The case of the farmer is in point Each man
under P rotection can satisfy his desires but under free trade only some men could do
Free trade would mean a greater good to some perhaps ; Protection means the
gr eatest good to all When the equilibrium of our industries was once destroyed would
t be immediately restored
Would our complex system o f industries immediately
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adj ust itsel f to the new conditions $ Would the capital and labo r escaping from t h e
rui ns of ou r manu facturing industries be able to find full employment $ It require
skill in vaticination to foretell the consequences o f a change to free trade First
the country wo uld be inundated with a flood of cheaper goods o manufacturing
industries w
ould be speedily overwhelmed One a fter another the furnace fi res would
be put out Machinery would stop and be left to rust When then the idle capital
and labor sought for other employment they would by their comp etition bring down
all profits and all wages Agric ulture certainly could not fully employ the surplus labor
and the inevitable result would be a smaller productio n of weal th On one condition
only could the once protected industries continue to exist— the reductio n of the wage
of American labor Protection a ffords to A m
erica n labor an opportunity both to pro
duce and to consume Free trade promises cheape r goods to labo r as a consumer but
what does it promise to l a
bor as a producer $ Free trade boasts that it will r espect not
merely the interests of producers but the interests of consumers as well This will be
no easy task When American laborers are lodged in almshouses they will do nothin g
but co n sume To American labor as a produce r free trade indeed o ff ers nothing but
the privilege o f com peting at starvation wages with the slave labor of E urope Ameri
can labor would then gr avitate to that industrial level where wome n are forced to toil
as men and squalid children c y for bread I f f ree t rade were adopted such a wanton
violation of that natural right of the American workingman the right to earn his own
living in his own land would be followed by a speedy retribution America afte r
thus expatriating her laboring classes would experience such a decli ne f her industries
a that which France experienced after h e expelled the H uguenots
The abolition of the protective system would therefore mean a transi t ion to a new
economic system to which our labor and industries could never be adapted Had
whole industrial history been accomplished u nder free t rade our industrial development
i ndeed would have been both disproportionate and stunted Nevertheless our labor
and industries would have matured under a free trade system and in that system every
man would have had a function to perform B ut when the industries of this country
have bee n developed u pon a protective basis when they have become adjusted to a
protective environment when the rights of capital and the rights of labor have become
vested in a protective system the destruction of that system would involve acat a t ph e
of which industrial history could a ff ord no parallel I n the early period under free
t rade the condition of our labo r and industry wa miserable i n the extreme and had
free trade cont inued their condition doubtless would have improved but little B ut
this condition would be prosperous in comparison of that to which they would now
descend if we returned from Protection to f ree trade The last state of the nation
would be worse than the fi rst
Since then u nder a Protective Tari ff we have achieved such industrial gr eatness
and con ferred such benefits upo n the labor em p loyed a man had best hesitate be fore
he aids i n the attempt to demolish this industrial system He had best ponde r long
be fore he dec lares for free trade whose disadvantages we su fficiently e x perienced in
our early industrial history of whose advan t ages we as yet k now nothing He h ad
best understan d what the advantages of free trade will be The advantages o f Pro
they are before
t ect io n have attended us through nearly three quarters of ou r h istory
ou r eyes to day Under Protection we know what we are Unde r free trade do we
know what we shall be $ Unce rt ai n of the consequences is it I a k rational to
exchange for the vague and fictitious advantages of free trade those r eal and m anifest
Advantages of a Protective Tari ff to the Labor and Industries of the United States
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RE TURN TO th e c i rc u l a ti o n d e s k o f a n y
Un i ve r s i ty o f C a l i fo r n i a L i b ra r y
o r to Th e
NO RTHE RN RE G IO NA L L IBRA R$ FAC IL IT
$
Bld g 4 00 Ri c h mo n d Fie ld Slal io n
Un i ve r s i ty o f C a l i fo r n i a
Ri c h mo n d C A c2 4 804 4 6 98
.
,
-
,
AL L BOO $ S MA$ BE RE C A L L E D A FTE R 7 DA$ S
2 mo nT
h l o a n s may b e re n ewed by
(5 1 0) 6 42 6 75 3
-
c a l l i ng
-
y e a r l o a n s may b e re c h a rg e d by b r i n g i n g
b oo ks To NRL F
Re n e wa ls a n d re c h a rg e s may b e mad e 4
d ays p r i o r Io d ue d ale
I
-
.
DUE AS ST
A M PE D BE L OW