Democratic Sentinel, Volume 6, Number 4, Rensselaer, Jasper County, 24 February 1882 — FREE TRADE. [ARTICLE]

FREE TRADE.

The True. Nation nJ Policy. In his lecture before the Brooklyn Revenue Reform Club, David A. Wells paid especial attention to the failure of the protective policy to develop the industries of the country. On this poilft he said : Tire-prime object for which the pro|ective pqliay has been instituted in this Country ahd the existing high tariff maintained is the development of our so called “ manufacturing industries ” and the rendering us a nation industrially independent In respect to most of our so-called agricultural products we are independent, and can export them to advantage in competition with all the world.* But a thing which can be permanently and profitably exported from any country cannot be protected by any tariff. This policy has now been in operation for twenty years. Has it accomplished what was intended? Here is a test question, and it can be answered exactly from data accessible to everybody who has access to the official records, and which docs not involve the least resort to hypothesis. What does an investigation of the character and value of our exports reveal ? First, that for the year 1879-80, 87} per cent, of the total exports consisted of unprotected unmanufactured products—all agricultural except petroleum; and, secondly, that the value oi our manufactured products exported constituted a smaller proportion of our total exports in 1879-80 than they didin 1869-70, and that the proportion was also smaller in 1869-70 than it was in 1859-60. Or, to put the case differently, in 1859-60 the value of our manufactured exports constituted 17.5 per cent, of the value of our total exports. In 1869-70, after ten years of a high-tariff policy, they had mn down to 13.4 per cent., and in 1879-80, after another ten years of like experience, they were further reduced to 12.5 per cent. During the same period the export of our manufactured unprotected articles increased from a proportion of 82.3 per cent, of our total exports in 1859-60 to 87.5 of the total in 1879-80. On the other hand, the value of our imports of. foreign merchandise, which was at the rate of about SIO.BO per capita in 1860, increased to 11.21 in 1870, and to $13.36 in 1880. All this talk, therefore, which of late years has been indulged in about the increasing ability of our manufacturers to command foreign markets ; all these flaming reports of Consuls, time to time are issued, to the effect thas. our industrial supremacy in these departments is being everywhere acknowledged, and that Great Britain is pervaded with apprehension thereat, is but the merest drivel and nonsense, the imagining of those who see only what they conceive it to be for their interest to see. Much boasting was indulged in at the recent tariff conventions over our success in the manufacture of carpets, and the dividends paid by the leading American carpet companies are known to rank among the largest in the country. But how about these ugly figures, from the official record for 1880: Exports, 8,541 yards; imports, 1,443,000 yards ? What, moreover, must be the condition of an industry when the persons engaged in it can go over to England, as our woolen manufacturers have done during the past year, and buy. for the price of old metal, old machinery which English woolen manufacturers have discarded as beirind the age, and bring it over to this country and work it at a profit? One would think that this fact alone would bring a blush of shame to the cheeks of those who are so clamorous about our industrial independence, but it does not seem to ; although the very idea of buying foreign ships of the most approved pattern, which we need and cannot profitably make, fills their souls with a holy horror. American sewing machine manufacturers are erecting immense establishments in Great Britain because they find that mainly through a greater cheapness of their raw materials they can better afford to manufacture machines intended for foreign markets in that country than they can in the United States. Sheffield, wdiich Senator Morrill recently reported as in a state of decadence, is exporting double the value of her peculiar goods to the United States that she did in 1879. * * *

The pressing necessity of the hour 'with us is an extension of our markets for our produce, and, in default thereof, we are certain to be smothered in our own grease. But, under the protective system, how are we going to obtain extended markets ; for protection means, both in theory and practice, restriction on exchanges and high prices, or it does not mean anything. But, with high prices for manufactured products, what chance is there for a sale of our goods in foreign markets in competition with other countries, which, by reason of free trade, the exemption of their raw materials from taxation or other conditions have already an advantage over us in respect to the cost of production ? For our manufacturers, under existing circumstances, to ever attempt to meet with such competition must entail consequences which would be absolutely ruinous, for they would be obliged to sell their exported products at a loss. Unless, therefore, something now unforeseen occurs, American manufacturers at no distant day will certainly be compelled, to adopt one of the two courses ; namely, to export their surplus products at a loss, oi‘ prevent a surplus by restricting their production and keeping a part of their machinery idle. In the first case, domestic manufacturing will be sure to be undermined by con tinual losses; in the second, there will be no opportunity for employment in our manufacturing industries of our rapidly increasing population, whose labor, as already shown, is not needed in agricultural pursuits.

, • A® to the prospect of free trade in the future, Mr. Wells said in conclusion : It is not generally known that Adam Smith, after writing his unanswerable argument in favor of free trade in his ‘•Wealth of Nations,” closed the dis eussion with an expression of opinion that to expect that freedom of trade would ever prevail in Great Britain would be as absurd as to expect that Utopia would be there established, and he assigns as the main reason for the opinion “ the private interests of many individuals who irresistibly oppose it,” and whose influence he declared could not be overcome. It is happily true that Adam Smith’s anticipations were not realized and that his teachings largely contributed to a different result. But it is equally true that this result would have been greatly delayed in Great Britain had not reform been necessary to prevent revolution on the part of a starving, discontented people, made hungry and discontented by the restric tiona on trade, which in turn made food

dear and employment scarce. Now 1 predict that history is going to repeat itself ; that, notwithstanding the weakness of individual efforts, economic reform in the United States in the shape of free trade, reduced tariff taxation and the repeal of the navigation laws, is coming much more speedily than most persons anticipate. The people of the United States, in respect to most public matters, attend but one school, and that is the costly school of experience. And this school is now open ; instruction has begun, and heavy penalties for failure to learn are being inflicted. We are already suffering punishment for errors in fiscal and commercial legislation by the loss of over $900,000,000 annually in our trade with the British North American provinces; by the decadence of our foreign commerce and the almost total destruction of our mercantile marine. Other penalties are in the course of preparation ; restriction of production by reason of restriction of markets and consequent stagnation of business, increasing pauperism and social disturbance. Under such experience the people must soon learn that future national development and the maintenance of a high-tariff policy are two things inconsistent and incompatible. Natural events are also working in the direction of tariff reform. The completion of the railroad system between the United States and Mexico will speedily force its consideration and will lead to an attempted reciprocity or Mexican annexation, and the latter is most probable, for the men engaged in these enterprises will soon find out that their investment can’t pay under the existing tariff, and they are not likely to accept the situation and do nothing. Tariff reform is therefore certain at no distant day, and, although individuals or associated effort will not effect it, they can do much to intelligently direct and hasten its progress.