Democratic Sentinel, Volume 14, Number 37, Rensselaer, Jasper County, 10 October 1890 — TARIFF LETTERS TO FARMER BROWN. [ARTICLE]

TARIFF LETTERS TO FARMER BROWN.

>O. 3. How Far the Tariff Increase* Prices. Dkak Farmer Brown — l think it was sufficiently shown in my last letter that the tariff raises prices. Since writing that letter my attention ha 3 been called to an article in the New York Dry Goods Economist on the rise in retail prices which has recently taken place in anticipation of the passage of the McKinley bill. Before entering upon thp question how much the tariff adds to prices, I will ask you to read the following extract from the article-just referred to: “Retailers within a few days have marked up goods from 5 to 10 per cent. To give a few examples: Surah and faille Francaise have advanced from 00, 75, 85 and 95 cents to 65, 80, 89 cents and SI. The 51.25 and 51.50 qualities are SI. 35 and sl-60, or poorer quality is markea up to the former prices of the better sorts. Cashmere and serge at SI were 90 cents a month ago. Striped cheviots of 50 to 90 cents are today 54 cents to SI. Ladies’ cloth selling for 51.35 was" 51.25 last week, yet the order for this was placed four months ago. Linen goods, such as sheeting, pillow casing, towels, table covers and napkins, have advanced in the last month from five to ten per cent. Towels that are now S 3 a dozen were 52.75 last month, yet these are standard goods that are often ordered a year ahead of delivery, and certainly are not influenced by the prices of to-day. Buttons and dress trimmings are about ten per cent higher, especially crochet and pearl buttons. Hosiery has advanced in the same ratios. Fifty cents are now asked for 47 cent stockings and 75 cents for the 09 cent quality.” If prices take such a rise in the mere anticipation of the McKinley bil l , what will they do when the bill becomes a law? How delighted will be the soul of Wm. McKinley, Jr., with his curious notions about the desirableness of high prices! And now for the subject of this letter, to determine how far the tariff raises prices. 1 said in my last letter that Republicans themselves speak of protective duties and revenue duties, by which is meant duties which afford protection to some native industry, and duties which afford no such protection, whether Because such industry does not exist at all, or because it not only exists but produces more than the home market can consume. Y'ou wilj sec, therefore, that we shall have to make a division of articles into classes. Before we Can determine how much the tariff raises prices lot us make these classes as follows: First, commodities which we produce ourselves in such abundaneo that we must sell the surplus abroad. Second, commodities which we produce 'in sufficient quantities to fill, or nearly fill, the home markets, and which we can sell in foreign markets at a profit.

Third, commodities which we either do not produce at all or produce in quantities insufficient for home demands. Commodities which fall under the first class cannot be made higher in price to tbre consumer by the imposition of a duty. Under this class fall the great staple products of our farms—our corn, wheat (including flour), cotton, and meat and dairy products. How do duties on these things help anybody? We have so much of them that we are compelled tosell them abroad to an enormous extent. In the year ending June 30, 1890, our exports of agricultural products were considerably more than three-fourths of all our exports. Our exported breadstuff's alone were in excess of all our exports of manufactures, the figures being $151,000,000 for manufactures and $154,000,000 for breadstuffs. Cotton exported reached $250,000,000, nearly $100,000,000 more than manufactures, while provisions of all kinds, including live hogs and cattle, showed a total of $168,000,00. Now, in cases where, these enormous quantities of commodities are being exported, it is clear that a tariff on the insignificant quantity of similar commodities coming into the country can have no effect whatever in raising the prices of our own products. Stand on the wharves of Liverpool, as I have done, and see the ships discharging vast heaps of our corn and wheat, and how contemptible does Major McKinley become in his attempt to beguile American farmers into tho support of protection with increased duties on corn and wheat! Never has a public man acted with greater insincerity and with a more palpable intention to deceive. He did not put a dutyon cotton—there are no votes to be made for him in the South by such cheap and transparent jugglery—and for all his duties on wheat and corn and on nearly every article classed as provision, you need not give the snap of your finger. You could carry in a quart cup all the extra product of your entire county by reason of McKinley’s higher duties. The same view is taken by tho more candid Republicans themselves. Senator Allison, who voted for McKinley’s duties on corn and wheat in the Senate the other day, said, in 1879, that the duties on corn and wheat afford no protection to the great grain-producing regions of the country, and that, “therefore the farmer has no protection at all.” And yet the Senator goes through with the solemn farce of voting higher duties on wheat, corn, and similar farm products! Verily, it is a “fraud on the farmer!” The second class of commodities are those in which tho domestic manufacturers or producers are able to fill, or nearly fill, tho horn# i>r«rkat a&.-i rviy

export to some extent at a profit. In this class the duty is only partly added to the domestic article; and under some conditions, as for instance a temporary rise in prices on the other side, it may be that no part of the duty is added. This latter condition occurred six months ago in the case of steel rails. The price in England, under conditions of trade partly temporary, rose to a point precisely equal to the price with us. The protectionists were quick to point out this case as a proof that the duty on the foreign article is not added to the price of the competing domestic article. “See,” they said, “you ‘free-traders’ are always saying that the whole duty is added to the price of articles made in our country; here are steel rails selling in London for 535 a ton, and the price in the United States is the same, but according to your ‘free trade’ notions tho duty of sl7 a ton ought to have made tho price of rails $52 a ton in the United States. Don’t you- see that your talk that the tariff is a tax is all humbug?” No; it is not humbug. In this case the equality of prices was merely temporary, as our own rail makers pointed out to Congress in their efforts to have the present exorbitant duty retained. “The duty,” they said, “must bo adjusted to meet the lowest English price,” which was some sl6 a ton; showing that as soon as a fall of prices should tako place on the other side they would begin to add a part of the duty again, and this has since happened. A very large number of commodities fall in this second class; and, it is always here that the protectionists make their fight. Here they find cases to prove their oft-repeated assertion that the tariff is not a tax. I have shown that in the first class it is never a tax; all I claim for the second class is that there the tariff is partly a tax, still, though, a tax. In the third class of commodities, which are either not made here at all or are made in quantities not sufficient for the home demand, the tariff is a tax to tho amount of the duty collected. As, however, my letter has extended beyond its usual length, I shall reserve my remarks upon this class for my next letter. Yours truly, Richard Knox.