Democratic Sentinel, Volume 7, Number 51, Rensselaer, Jasper County, 18 January 1884 — JOSEPH E. MCDONALD. [ARTICLE]

JOSEPH E. MCDONALD.

seeh of the Indiana Statesman before the Democratic Editorial Association, at Indianapolis. entlemen of the Democratic Editorial Asaoaon of Indiana: In responding to the in«tion to adffress yon, I have selected as the •Ject of my remarks, “Oar commerce with jjgn nations and its relations to the pro:tive industries of Indiana." It is a subject >n which volumes might be written wi.hout austing it. To arrange and classiiy its most >ort&nt facts would require much time and lent labor. All I can hope to do on this ocion will be to collect together a few of its st striking and instructive features, and sent them as subjects of future investigai and reflection. In every age of the world wealth and power of a nation has been ged more by the extent and character of its amerce than by any other standard; and in dent as well as in modern times those ions that displayed the most enterse in commercial pursuits have led the i in the -march of civilization. Of the dent nations, the Phoenicians are * unibtedly entitled to the front rank as a comrcial people. Their landed possessions were important, consisting of a strip of country ; more than twenty miles wide and 130 les long, tying north of Palestine, bounded the west by the Mediterran an sea and on ■ east by the Lebanon mountains. Its whole lent did not exceed 2,000 square miles, and s little else than the foothills of tae Lebanon ige, withhere and there a promontory jutt.ng ; Into tae sea. On two of whose promontories re founded two of their chief cities, Tyre and lon. The moan ains of Lebanon furIhed them materials for constructing their pa Their supplies were drawn from the Hid of Cyprus, and soon the then known rid paid tribute to them Eignt nundred irs before the dawn of Christianity they had iched one zenith of taeir power. Their colons had been planted on botn sides of the Medrranean as lar as the P.llars of Hercules. The »t notable of tnese was the Carthaginian rebiic, on he As rican coast. Their ships had ten soundings in every bay and inlet of that i, and had passed through the Hellespont and sphorus and explored tae Blaok sea, but not ntent wi h the land-locked waters of the Medrranean and Black s as, they pressed their uturous sails through the “Straits of Hercu.es” io the Atlantic oci an, and sailed as iar northird as the British Isles. “Their wise men ire their pilots," and they are the first people, far as history has informed us, who trusted the guidance of the stars in traveising the ackless ocean." These cit.es became the irushops as well as th-j marts of the world's (amerce, and the raw material brought irom itant lands by their ships was turned into all inner of merchanoi-.e. The skill of their irkmen and artisans has given them an imartality which their monuments e.ected for at purpose failed to secure. The Prophet Ezeel, in speaking of Tyie, the chief of the cities Phoenicia, said; “Thy builders have perfected y beauty; they have made all thy shlp-lioards fir trees of Benir; they have taken cedars >m Lebanon to make thy masts. * * * bine len, with embroidery work, from Egypt, was at which they spread forth to be thy sails; ue and purple, from the isles of Ellahah, was at which covered thee, * * * The Inhabitits of Gideon and Arvad were thy mariners; y wise men of Tyre were thy pilots." Tim destruction of their cities put an end to s power oi the Phoenicians upon the sea as dl as upon the land, and no other nation in LCL.'Ut times seems to have come lorward to asrt Lie supremacy of the seas so long mainined by them. Much of the skill and some of e arte of navigation appear to have been lost the world In their downfall. A few of the re clan states, particularly Athens, aohieved stiflction as maritime powers; and the Cartbanians inherited some of the seafaring qualities the Another country,” and as long ai they aintalned their ascendency on the sea, baffled 1 efforts of their great rival, Rome, to destroy tem. In modern times the discovery of America we an impetus to commerce unknown to the orld before the happening of that event. Spain, ider whose flag the discovery was made, took ip lead in this new field of adventure. England id France were not slow in claiming a share in le “new discoveries,” and in the end England Kikthe lion’s share. Among tho e European >we. 8 that sought to extend dominions over

le new world tnere was one that deserves more i&n a passing notice. Long after the discovery of America the Unit--1 States of the Netherlands were dependencies ! Spain. But they were a bold and liber, yiVing people, and soon revolted from Spain, ccupying a country in the northwest part of le continent of Europe, fronting on the North ia, much of which was below its level, and insrsecied by the passes of the Rhine, pieroed by ilete and estuaries, their first labor was to reele their country from the sea by dykes and rain it by building canals. Then it became ecessary to build ships and boats, as well for Hand as foreign commerce. But no sooner had ley achieved their independence of bpain than ley boldly entered the ocean with their ships, nd speedily became one of the leading maritime ©were. Their adventurous sails were in every sean and sea, and their colonies were estabshed and maintained in ©very quarter of the lobe. They were the first to explore the North merican coast from Hudson's bay to the Dela'are. They entered New York bay and took ossession of Manhattan island, established a llony upon it, and founded the city of New insterdam, now New York. Their restless enjrprise brought them in sharp competition, and wnedmea in conflict with other maritime naions. In the wars which followed they proved n over-match for their ancient enemy, Spain, nd for a lime held E. gland in check, then rapily advancing to the position she has since laintained of “mistress of the seas." When ard pressed in their wars with Louis XIV., of 'ranee, being deserted by their allies, andgreaty over-matened on the land, they s rionsly oonemplated abandoning their country altogether nd embarking upon their ships with the purose of making a home among their colonies, .'his desperate purpose, born of heroism and lespair, was only abandoned to form another qnaliy heroic, which was to open their dykes nd let in the seas to thrown one their enemies, rhich they ca ried into effectual execution. When the proprietary rights of European •owers to the Western hemisphere came to be ettled, England was found to be in possession 1 the eastern ooas.s if the Nortn American ontinent from New Brunswick to the peninsula t F lorida, and soon ti.at entire sea front was etthd by hardy emigrants from that country, •ringing with them the language, the laws, and he civi ization of the "mother country," and hese men laid the foundation for that new •ewer now so well known as the United States if America; It is not possible to oalculate the efeot produced by the development of the reonrees of a great continent on the trade and commerce of the world. A new quarter of the ;lobe was opened* *up to the enteiprise of the >ld world, and since then each now development has added to the volume of its trade. . The iucro' se in our own day has been so great hat statisticians have failed to keep pace with it, and their reports are but approximations. Che report of the State department for the year ,881 plac s the aggregate commerce of the world of tne year 1880, tuc. uding imports and exports, it over sixteen billions. Of this Em ope furd§hed eleven billions, and America, No. th and tali, two and a half From this you will see hat the t ontn.ent of Europe, which is least in ©riitorial ex ten. of any of the great divisions if the earth, furnishes nearly three-fourths of he whole amount. This commerce, which fer a single year is neasofed by these vas, sums—so great that we ’all to have any just conception of them—has teen the growth of years; bnt the part which he United States has taken in bull ing it up nay be said to date from the adoption of the federal constitution and the organization of the federal Government under it. Betore that time he several State-i, each for itself, carried on sommoice with each other and with foreign it&tes under certain rttstilciions, imiosed by he articles of confederation; but it was not; intil the Federal constitution went into effect, frith the express power there n granted to- the lovernment of the United States to reau ate lommerce with foreign nations and among the Slates, that the subject of our commerce at lem s as well as abroad became a matter of national concern and nnder national control. I lave no data to deteim ne the amount or charteter of our commerce at tha; time, but from wr tonnage th neig'vged in loreign trade as registered for the years 1790 and 1791, it mast lave been an important item in the world's ir&de. It was a subject which always engaged be earnest a.ten ion of the colonists from the fine of their settlement on this continent.

It is n t my purpose to trace its progress year by year, as to do so v. ould require more Ame than could be allotted to an occasion like this. And then it is with the present, rather *an the past, that I propose to engage your attention. In the official figures of the year ending June iO, 1888, it may be stated as follows: Exports of domestic merchandise..s 804,22‘,632 imports of foreign merchandise.... 728,180,914 Total * $1,1547,020,316 Irftrge as this aggregate is, it falls lar short of Uae commerce of Great Britain, which is given lor the vear 1880 at: -* Emporia. $1,998,677,000 Exports 1^191,9^2,000 Total ....$3^90,499,000

The Imports Into England exceed by more 1 than $400,000,000 oar entire foreign commerce. We about equal France and Germany as to quantity, but the quality of our exports differs very materially from that of our great rivals. Taking the analysis of our exports for the fiscal year, as given in the report of the Bureau of Matt-tics, we find that $619,209,448 are the products of dome-tic agriculture, $11,39t',0t 0 the prod nets of domestic manufacture, and $51,444,357 the proiucts of mining: or. agricultural products 77 per cent, manufactures 14 percent, and mines 7 per cent The foreign merchandise . we receive in exchange for this, except sugar, coffee, tea and certain drugs and medicines, is almost wholly made up of the product of manufacture—goods, wares and merchandise which have received all the labor of which they are capable, and every value that man can bestow upon them. Onr exports are chiefly raw material — the products of the soil in the crude state. Our imports are the products of skilled labor, some of it bestowed upon products which we have sent abroad, and which is returned to us greatly enhanced in price. Last year our imports of cotton goods amounted to $38,000,000. The lea t price per pound of the cheapest article was not less than 21 cents, the raw material in it not costing half that sum. When we follow our exports to their destination we find they are mostly taken by England, France, Germany, and a few others of the European nations. Our exports to South America, Asia, and Africa are not important. England is our chief customer, receiving from ur during the last fiscal year $125,404,174, being largely more than half of all we sent abroad. Nearly all of this vast sum was raw cotton, breadstnffs, and p ovisions. Food for her people an! mate lal tor heir factories. From an examination of these facts, it is quite apparent, that the burden of our foreign c.mmerce falls too h-avily upon the productions of our soil. It is a good thing to have a market for our surplus products of agriculture, but it is not safe to rest onr trade with foreign nations upon one branch of our productive industry, especially when competition Is constantly on the increase. England to-day is our best customer, because her necessities compel her to purchase of us, bat the time may come, and that before many years, when her own colonies will furnish her with breadstuffs and provisions. As to cotton, which is onr chief-article of export, it is not likely that the factories of Europe will ever refuse to receive from us all we may be willing to export, but it is to our interest to make that as small as possible using more of it at home. At present we manufacture but 30 per cent, of our cotton crop and send to per cent, abroad. But the time is not very far distant when the order of things in this respect will be Reversed. When the manufacturing centers for cotton goods shall be established, as they will be. In the cotton belt, we will use the raw material at home and ship the manuiactured article to other oountries, not, perhaps, to Europe, but to those countries w,th which at present we carry on but little commerce, and that chiefly confined to the purenase irom them of such articles as are indispensable to us, as is now the case In our trade with Brazil, our last year’s purchases from her being $14,488,459, and our sales $J,z52,00. it Is true the ratio of our exports of agricultural products, as compared with all others, including the products of mining, has not undergone much cuange for the last fifty years, but when we take into consideration the large increase in mine products, and particularly in petroleum, which is now one of our chief articles of export, there has been a ecrease in the ratio of manufactured articles exported that is not very assuring. These infirmities in the composition and make-up of our foreign trade are attracting more or less the attention of the public, and of our public men, espec ally those who believe the time is fast approaching when we must shape our policies so as to meet the changes which must occur in our foreign trade. Our natural advantages thus far have enabled ns to outstrip, all other nations in the “natural products’’ and to enter the foreign markets open to such product! ns with every advantage on our side. In this we have been greatly aided by the enterprise and industry of our farmers and planters, by improved implements and .machinery, and by onr railroad system, by which our prodnets can be brought to the seaboard from any part of our extensive country. Our natural advantages for engaging in manufacturing successfully, at least in the leading branefies, is equally great. And yet it is manifest the expansion of our manufacturing industries has been to meet the’ demands of a home market, and if lor any cause our agricultural products should fail to meet the demands of our foreign commerce, we have nothing to take their place. In onr present condition two short crops, or perhaps one, with the competition we have to meet from other countries, would bring on a financial panic of the most serious character. It will be remembered that in the early part of 18t-2 we were on the verge of such a panic, and the apjfehenslons created in our commercial centers by the exportations of gold to settle our balances abroad did not pass away until the crop of that year had been assured. The danger we were then exposed to must combine until we are prepared to enter foreign markets with the pioducts of our factories as well as the products of our farms, and in quantities sufficient to supply any deficiency in our farm products, arising from any cause whatever.

It has been insisted that to compete with foreign manufactures and foreign markets, it will require a reduction of wages in this country to reduce the cost of manufacturing. This might be true of such articles as derive their chief value from the labor bestowed, and whete the raw matesial costs but little. In most of this class of goods France has taken the lead, and it is not likely that we, or any other people, will enter into serious rivalry with her; but it is not true in respect to the great bulk of manufactured articles, either textile or metallic. It is a fact, well kno>*n, that the higher price of American goods and wares, whicu have heretofore kept them out of foreign markets, has not resulted to the benefit of the laborers engaged in 'their production. That labor is not paid nor the price of it fixed bn any scale dependent on the profits of capital invested, is a fact that has been often demonstrated, and that capitalists will import labor as readily as any other commodity, it it is profitable to do so. The great law of supply and demand regulates its price, as it does of anything that is to be bought or sold. It is also susceptible of demonstration that the wages of labor at this time in the United States, when the cost of living is taken into account, cannot be reduced without, in many instances, putting it below the subsistence point. And no interest can flourish for any length of time if the wages paid are not sufficient to support the employes and those dependent upon them. On the other hand, the present system of manufacturing for a home market at prices that cannot be reached in a foreign market has this serious conseqnenoe attending it: If, in any given branch of manufacture, the production is in excess of the home demand, the excess cannot be sent abroad, bat must remain on hand until it can be taken up for home consumption. This produces for the time being paralysis in the trade connected with that industry, and there is what they oall a “shut down,” and the laborers are thrown out of employment for a longer or shorter period, depending upon the state of the home market. Within the last few months we have had some striking illustrations of the truth of ihis statement. How far they are to extend and what financial disasters .will result from them Is yet to be determined. But, so tar as the American laborer’s interests are Involved, it is easy to see that there is no safety to him in a system of labor under which he is liable to be thrown out of employment at any time because his employer has supplied the only market to which he has access. Nor does that manufacturer derive any benefit ftom his ability for a . short period to make large profits if be has to be idle a good part of each year. It would se 'in, therefore, to be the interest of labor and capital to combine in an effort to extend the market, end thus avoid the evils of over-production. Our agriculturists sell all their surplus production both at home and abroad by tne prioes fixed in a foreign market; and while in some branches our manufacturers could not do so now, it is the part of wi-dom to prepare f.-r it as soon as posstb.e In the results which will follow, the manufacturer has this advantage over the agriculturist; almost evtry market in the world is open to the manufacturer; while the agriculturist can only Sell to those countries wne e there is a deficiency of natural products. An important subject connected with our commerce with foreign nations is the condition of our merchant marine, past and present. It is becoming generally known that we are fast losing our ma itime character, and that the carrying trade for our merchandise on the high seas is passing nnder the flag* of other nations. Should the decadence of American tonnage cont nne in the same ratio for a few years longer th t It has for the last twenty years, it cannot be long before our ships will not be seen outside of the lines of our ooa i t trade. From the adopts nos the Federal Constitution down to the year 1880 about 88 per oent. of the tonnage of our foreign commerce was o irried by Ame loan vessels; from 1881 to 1860 there was a loss of 22 per cent.; from 1861 to the present time a loss of 46 per cent., the present American tonnage being abont 20 per oent.: bnt the value of our own mercfcandlse carried in American vessels is only 16 per cent. Since 1856, while other nations have greatly increased their tonnage, there has been an actual decrease in ours, so that we do not register now as many tons as we did then. It may make no differtnee to the merchant what flag floats above his cargo of merchandise, exoept so far only as it mav affect its safely. But it makes a great difference to ns as a nation, with our extended sea coasts upon the two great oceans, whether we shall have a merchant marine bearing some just proportion to the magnitude ot our ocean commerce, or whether we shall be driven within the lines of - nr coasting trade. Yon will notice in recalling the fact showing the decline in onr shipping interest, that while that decline has been much mire rapid in the last twenty years than it was in any like period before that time, yet it has been persistent, and continuous so tar back os 1830. Many have sup-

posed that our losses during the late civil wm were the chief cause, but aa we are able to estimate our exact loss during that period, and as the decline has been equally great since, it is evident that we must look further and find some cause which operated to that end before as well as since the war before we have solved the question. The Chief of the Bureau of Statistics, in a very interesting report made in 1882, on the subject of our foreign commerce, suggests the chief cause of decline in American shipping to be the diversion of the enterprise and capital of this country irom the sea to the development of the vast area of territory lying west of the Alleghenies. There is undoubtedly much in this suggestion. Our loss of tonnage during the civil war, as theiesultof the presence of reb,-l cruisers an the high secs, direct and indirect, amounted to 879,157 tons. Of this amount only 104,605 tons were of vessels destroyed by the rebel’cruisers, while vessels segregating a tonnage of 774,652 tons exchanged the American flag tor a foreign flag, for protection as mnch against the exactions of war insurance as the danger of seizure; and when the war was over o u i*Go vemment, acting under some mal gn influence, refused to permit their return by denying them the right of registration. This loss, great as it was, and to a great self-inflicted, is not sufficient to account for the present condition of our shipping interests. But it we take the suggestion of the Chief of the Bureau of Statistics as the chief or moving cause the solution of the problem becomes less difficult. In 1830, when the decadence In onr merchant marine seems to have begun trader influences that have been persistent down to the present time, the Alleghenies had not been crossed except by the sturdy pioneer. It is true three great States had been carved ont of the Northwestern Territory, and were in tapid process of settlement, bnt they were almost wholly dependent upon the water lines for transpor ation of freights. And these. In all instances, were circuitous and often imperfect The practicability of railroads, even in level countries, had not yet been fully demonstrated, and years atterward It was not supposed that mountains could be orossed by them, except by the difficult and dangerous process of the inclined plane. At that tune there were but twentythree miles of railroad in the United States, and that but little better than a tram-way leading out from Baltimore. We now have over 90,000 miles, whioh include three trunk lines, at least, terminating on the Pacific ocean, representing a capital of over $3,000,000,000. These lines not only furnish the arteries for our interstate commerce, bnt carry to our i-eaboard much of that surp ns of domestic merchandise which finds its final market abroad, and which forms the export column in onr account of foreign commerce. This internal syst. m cf improvement has also aided in the development of tne “vast interior" in its agricnltuial as well as its mineral resources and has tended greatly to the increase of those productions, and has therefore added much to the volume of onr exports; but, having accomplished this much, American enterprise has stopped there. It has been left to other nations to take our surplos products at cur seaports and carry them abroad and bring back the goods we reoeive in exchange for them, and to make all the profits to be realized, directly or Indirectly, from that branch of trade. If this rapid growth upon the land has been the main cansc of the loss of maritime importance. it is reasonable to suppose that at no distant day we will be in a condition in part to regain it. The absorption of capital and enterprise in internal Improvements and other kindred industries is not likely to increase in the same ratio In the future as it has done in the past, while our extended sea front upon the Pacific as well as the Atlantic must attract a portion of that capital and enterprise to commercial pursui. s. The Importance of so doing is very manifest, both in a commercial point of view as well as a means of national safety—for if, in our present helpless condition In respect to our foreign trade, a war should break out in Europe that should temporarily deprive our merchants of the use of the Brittßh morchant vessels, our surplus products would rot in our ports be ore we could create tho means of earn ing them to market. On the other hand, if we should be threatened with a foreign war we have no considerable body of experieno d seamen to defend us from the attacks of our enemies. This last danger has been so often mentioned as to lose its effect, and yet every person whose attention has been called to It admits its existence. There are other causes than, those I have named, which, if they have not contributed to the decay of our shipping interests, have at least not retarded it. The most noteworthy of these has been, and still is, that indifference which onr Government has manifested toward its growth or preservation. I have already mentioned the decree of ostracism pronounced against all those vessels that took protection under foreign flags during the war, and which has been continued to the present day, long after amnesty had been extended to all other classes of offenders; but that was an act which spent Its force upon the offending parties. Our registration and navigation laws have always been restricted and illibe. al, and have not the merit of being original. We adopted the most objectionable features of the English navigation laws, and have continued them In force long after they had been repealed or modified in that country. Something of the spirit, temper and character of these laws may be learned by any one who will examine a few of the sections of the Revised Statutes of the United States under the title, “Regulations of commerce and navigation." It will be seen by the first section that vessels registered pursuant to law, and no others, shall be deemed voesels of the United States. By the second section it is provided that “vessels built within the United States and belonging wholly to citizens of the United States, or vessels captured by the citizens of the United States and condemned as war prizes, and belonging wholly to citizens of the United Spates, and none others, shall be entitled to be registered.” In many ways a vessel may forfeit its registry; among others by a sale to foreign owners. Now, as our merchant marine is made up wholly of our registered vessels and those that keep their registry good, it is easy to see, that under snch a policy os th s, its giowth would be slow and its preservation difficult. Efforts have been made within the last few years to modify or repeal these laws, and to introduce a more liberal and enlightened policy in their stead, but those who have a special Interest in their preservation have been able thus far to defeat all such attempts.

In this brief review of the present state of our commerce with foreign nations, as connected with the industrial interests of our St; te, I hare endeavored to present thefacis, free fiom any party coloring, believing that interests of such magnitude ought to be oons.dered more with respect to their eilect upon the general prosperity of ihe country than any influence they may exert upon the political contests of the day; and while w are all members of the same political party, and desire its success, I hope we are of tuose who believe that “he who serves his country best serves his party best," and that true Democracy consists in the adoption of snoh measures and policies as will, being right in themselves, result In the “greatest good to the greatest number.”