H. OF R.]

The Tariff Bill.

[JAN. 23, 1833.

stracted from the permanent revenue, there can be no not reach our commerce on the ocean? And then, sir, occasion, at present, to reduce the imposts. We can what becomes of your revenue from the customs? Though safely wait till we have paid all our debts, we can wait we may not be parties to the war, can we escape being till we can ascertain whether future expenditures will be-parties in the war? So long, then, as there is no necessity come necessary, from any of the sources I have indicated; for an immediate reduction of duties, does not sound po and we shall learn something by experience of the ope- licy dictate that we should wait until our foreign relations rations of the act of the last session. are fully developed?

A single remark_more on this part of the subject. As I come now to what I deem a more important questiona mere question of finance, I would ask, why should this the operation of this bill on the great agricultural and act take effect the present year? Is any reduction of re-manufacturing interests of the country. venue necessary for the year 1833?

Under the proposed bill

Proposed reduction for 1833

From this deduct the new taxes

In manufactures alone is invested a capital of not les

The report states the amount of revenue, for 1833, than two hundred millions of dollars, which connects it under the bill of 1832, at -$19,530,648 self with every branch of agriculture. The magnitude 17,051,884 of the subjects, and the immense effects that are often produced by causes apparently trivial, should induce us 2,478,764 carefully to examine the path we tread. But, sir, the 1,855,025 gentleman from Tennessee, [Mr. POLK,] following up the lead of the honorable chairman, has told us this is 623,739 not the time to discuss the general principles of the bill; we are called on to reduce the revenue for the pre- that its details should be first settled; that, by amendment, sent year. I shall have occasion to recur to this subject it may be made a new creature. Sir, with great deference, again for another purpose. I shall, also, before I take I think this would be beginning at the little end. How, my seat, state the principles on which, in my humble and to what end, shall we offer amendments, unless we opinion, the revenues should be reduced.

And for this sum of

have some principle, some settled object in view. One But, sir, there is no occasion to reduce the revenue, assumes that fair protection should be given to the great even this sum of six hundred and twenty-two thousand staples, and to the manufactures of the country; another, dollars, the present year. The years 1831 and 1833 were that it should be limited to articles essential to our safety years of excessive importation; according to the usual in time of war; a third, that the duties should be laid course of commerce, the importations of 1833 must be equally on protected and unprotected articles. Each will very considerably less, probably by twenty per cent. shape his amendments to the object he has in view. With Under the tariff of 1832, the duties on an equal impor- what hope of any beneficial result can we proceed in such tation to that of 1831 would be

Deduct twenty per cent.

Leaving for the probable customs of 1833 It is stated in the report, that "the sum necessary for the ordinary operation of the Government, providing liberally for an efficient civil, military, and naval service, including the pension system of former years, need not amount to more than" 13,(00,000 To this, for the present year, must be added

The semi-annual pensions, under the pension law of 1832, for 1st September, 1833

Two years' arrears of pension, to the 1st March, 1833

Enlarging the expenses of our present Indian policy, custom-houses, public stores, &c. &c. as estimated in the report

875,000

3,500,000

1,030,000

$19,530,648 a course? It seems to me that we should first settle the 3,906,128 principle of protection-its objects-and then, and lastly,

its extent. And further, perhaps this may be the only 15,624,520 opportunity-the previous question may be applied.

i have had some difficulty in ascertaining, with any degree of precision, what are the principles of the Gos ernment, or rather of the administration, in relation to this subject of protection. I find others in the same un certainty. In the message I find the following paragraph:

"The protection afforded, by existing laws, to any branch of the national industry, should not exceed what may be necessary to counteract the regulations of foreign nations, and to secure a supply of those articles of manfacture essential to the national-independence and safety

in time of war."

These principles, if they were to be permanent, ap plicable to future as well as to the existing laws, we cover all the ground the most ultra tariff man could ask To counteract the regulations of foreign nations, which, by high duties, virtually prohibit the great staples of a large portion of our country, our flour, beef, pork, fish, 18,375,000 oil, lumber, &c., we might, by like duties, exclude their manufactures. Suppose cotton were added to the list of But, sir, the amount of revenue that would accrue un- excluded articles; we should have no difficulties with the der the bill reported, must be considered as uncertain. South. And should the British Government hereafter, It depends on contingencies. So far forth as this bill de- to protect the products of its foreign possessions, impose stroys our manufactures, it will increase importations of such duties, or should any event prostrate the English the protected articles for a year or two; but, as it tends manufactures, would not the South have some reason to to diminish our means of paying, it will soon diminish con- regret her hostility to those of the North, and to rejoice sumption, and of course diminish importations generally. that they had been sustained. I will not pursue the subMy fear is that it will eventually reduce the revenue below ject further. Essential to our independence and safety the wants of the Government; and when new duties shall in time of war," are words of extensive import. As be necessary, it too plainly indicates the articles on which heretofore construed by the Government, they include those duties will be laid-on the unprotected articles. I not merely munitions of war, but all articles essential t cannot but look upon the introduction of the new duties on our comfort. I refer more particularly to Mr. Dalias' the necessaries of life, coffee and tea, as the entering report on finance, of the year 1816. wedge for the destruction of the protective system. One other consideration against reducing the duties, 1 will merely suggest; it arises from the present belligerent

protection must be ultimately limited to those articles of In the same message is the following: "The policy of domestic manufacture which are

indispensable

to our

too surely the approach of a general continental war. our safety," give rise to the all-important question, state of Europe. The signs of the times indicate but safety in time of war." The words, "indispensable to

Will its operations be confined to the land? May they" What are those articles?'

On the answer to this qu

JAN. 23, 1833.]

The Tariff Bill.

[H. of R.

tion depends my assent or dissent. Are they to be under- that the adventurers in manufactures supposed it was stood to be co-extensive with the former opinions of the sufficient; not that it was, in fact, sufficient. That is Chief Magistrate, read by the honorable gentleman from matter of fact which depends on evidence; and what is Pennsylvania, [Mr. MCKENNAN,] a few days since, and of the evidence? The issue is, whether manufactures were, which I avail myself? "Providence has filled our moun-in 1824, sufficiently protected by the act of 1816. Whattains and our plains with minerals—with lead, iron, and ever might have been the suppositions, the calculations, copper, and given us a climate and soil for the growing or the hopes of the manufacturers, they were, to their of hemp and wool--they being the great materials of loss, mistaken! I now refer to the evidence contained in our national defence, they ought to have extended to them this book. It is a volume containing the manufacturing adequate and fair protection, that our manufacturers and statistics of Maine and Massachusetts, collected by order laborers may be placed in fair competition with those of of the treasury. I refer to a single statement. I find Europe; and that we may have, within our own country, many more, however, of the same character. I read a supply of those leading and important articles so essen- from the answers of Aaron Tufts, who, I understand from tial in war."-[Extract from General Jackson to Mr. Col- those who know him, sustains a high character for intelman.] The sentiments contained in this extract will meet ligence and integrity. I read it not only to disprove the the entire approbation of the friends of the protective conclusion of the report, but to show the real condition of system. But, sir, we were told the other day that they manufactures from 1816 to 1832. were to be understood in a much more restricted sense; as including only munitions of war. The gentleman from New York [Mr. HOFFMAN] seemed to speak ex cathedra. I hope he is mistaken.

"It will not be in my power to answer but part of your questions, the principal object of which appears to be to ascertain, from facts elicited, whether the manufacturing business is so productive as to justify a reduction of the Since the message, we have received the report of the duties on the foreign article, and still leave the domestic Secretary of the Treasury. Though he is not the official protected. I can answer this general question as far as it organ of the Executive, yet it is to be hoped that, on this respects the woollen business, and which will apply also occasion, he is in accord with the President. In this re-to wool. I have been led to watch, with great attention, port I read: "This power [of laying duties] ought to be the progress of the woollen business from its commencedirectly exerted; to counteract foreign legislation, inju-ment. I was a stockholder, for about one year, in the rious to our enterprise, and incidentally to protect our first factory which was put in operation in this country, in own industry, more especially those branches necessary 1812; and having, from that time to the present, been the to preserve, within ourselves, the means of national de-owner of a large flock of fine woolled sheep. This facfence and independence." This seems to regard the tory commenced business with a capital of thirty-one future as well as existing laws, and seems not in perfect thousand dollars paid in, and invested, the whole of agreement with the last clause of the message. I next which was lost previous to 1818, and the factory passed refer to the report of the committee, which accompanies into other hands. Other factories in this country went the bill. The promised protection is only "in those in- into operation at different periods previous to 1820, which, stances where national independence, in the time of war, in almost every instance, have since become insolvent, or seemed to demand some sacrifice in peace, (as in the case closed their concerns with a total loss. I will instance of iron;) where it was thought a higher or a lower rate of the woollen factory in Southbridge, which closed its conduty would be of advantage to the revenue, without any cerns about three years since, with a loss, as I am informindividual injury, (as in regard to distilled spirits;) or ed, of one hundred and eighty thousand dollars. South where some branch of industry might be materially bene-Leicester Corporation, about the same time, met a loss of fitted by low imposts on some of its raw materials," (as, one hundred and ninety thousand dollars. Others might I presume, in the case of wool.) I now ask, what is the be enumerated, the situation of which would be no better. precise principle? what the extent of protection to be de- These factories were owned by gentlemen of abundant duced from these sources? On this subject it is important capital, well acquainted with mercantile business, and that the public should be correctly informed. It is im- under the immediate direction of practical manufacturers. portant to the North to know on what they have to de- I am satisfied, from facts in my possession, that, in the pend; that they may in time prepare to meet whatever woollen business, in the aggregate, previous and up to crisis awaits them. It is important to the South that they the year 1824, the loss would be equal to the whole should know what they have to hope or to fear. A reso- amount of capital invested. The tariff of 1824 was conlution, now on the table, should it pass, would, no doubt, sidered a pledge given by Government, that protection elicit the so much desired explanation.

should be afforded to the industry of the country; it held The report adopts, as a basis, the tariff of 1816. And out some encouragement to the manufacturer, and inwhy, sir With what propriety? At that period our duced many to embark in the business; a large amount of manufactures were in their infancy; they had grown up capital was invested. Some of those who had gone into only under the protection afforded by embargo, non-in operation previous to 1824, had survived in a languishing tercourse, and war, from 1807 to 1815. The uncertainty condition, and a part of those, after 1824, were ruined of the duration of those restrictions had been unfavorable by the severe pressure of 1829. to the investment of capital; yet, to some extent, it had "I do not believe that those who went into operation beer induced to adventure in manufactures. Since the subsequent to 1824, have made a dollar in the aggregate, acts of 1816, 1824, and 1828, those investments have in- though there are some few instances where, by fortunate creased a hundred fold; not only in the then existing coincidence of circumstances, they have made six per manufactures, but in various new branches, affording centum or more; but these exceptions have been more new objects of protection. How then it could be imagin- from mercantile operations than the regular business of ed that a tariff, suitable to the condition of the country in manufacturing. But few dividends have been made. The 1816, should be applicable to 1833, I cannot conceive. following statistical facts were obtained from the owners You might as well, sir, attempt to put the garment of an or agents of most of the woollen factories in this country, infant upon a giant. and were taken for the year 1831, and, it is believed, are But the committee have given us their reasons. I will very correct. They will go far to establish the opinions examine them. First, that" the vast increase of manu- I have given in the foregoing remarks. factures, of all sorts, proves-(proves what?)--proves The whole amount, in value, of woollens that the protection of the act of 1816 was ample." A made in this country in 1931, is . non sequitur, sir. It proves no such thing. It proves

$2,499,500

Commissions and guaranty on sales of $2,-
499,500, at 7 per cent,
Insurance, interest on capital,

$1,518,000 with proper cultivation, are capable of being matured to 417,724 the whole extent of the demand.

298,562 "Third Class.-Manufactures which are so slightly cultivated, as to leave the demand of the country whol $2,234,286 ly, or almost wholly, dependent on foreign sources of supply.

174,965 The matured state of the first class of manufactures 188,590 relieves the task of forming a tariff with respect to them from any important difficulty. Duties might be freely $2,597,841 imposed upon the importation of similar articles, amounting wholly or nearly to a prohibition, without endangering a scarcity in the supply, while the competition among the domestic manufactures alone would sufficiently proHere, sir, are facts not to be done away by conclusions. tect the consumer from exorbitant prices, graduating, A manufacturer who, between 1816 and 1824, had sunk generally, the rates of the market by the standard of fair his whole capital, would be content to be told that his ad-profit upon the capital and labor employed. It is true, venture was ill-advised, but nothing short of the restora- however, on the other hand, that, by imposing low duties tion of his capital will satisfy him that he has not lost it. upon the imported article, importation would be encou I will not read further from this book to this point. With raged, and the revenue increased; but, without adding to us, sir, it needs no corroboration. What we have suf- the comfort, or deducting from the expense of the confered-what we feel, we know. And it would seem to sumer, the consumption of the domestic manufacture me, the committee should have been led to doubt the would, in an equal degree, be diminished by that opera correctness of their conclusion, from the fact that the tion, and the manufacture itself might be entirely sup manufacturers were then (1824) asking for further pro- planted. It is, therefore, a question between the gain of tection. I proceed to the second reason, hardly less the revenue and the loss of the manufacture, to be decidsatisfactory: "So well does it (the tariff of 1816) ap-ed on principles of national policy. Under the circumpear to have been adjusted in regard to woollens, that stances of an abundant market, the interest of the conthe manufacturers of these goods, examined by the Com-sumer must stand indifferent, whether the price of any mittee on Manufactures of this House, in 1828, generally article be paid for the benefit of the manufacturer, or agreed that their business was in a more flourishing state the importer. But a wise Government will surely deem under the tariff of 1816 than under the higher protection it better to sacrifice a portion of its revenue, than sacrifice of 1824." Ergo, the tariff of 1816 is a proper basis for those institutions which private enterprise and wealth protection in 1833. Unless this conclusion is drawn, the have connected with public prosperity and indepenfact has no connexion with the argument. But the fact dence." being true, does not prove that manufactures had sufficient protection under either the tariff of 1816 or of 1824; that, also, depended on matter of fact.

Wear and decay of machinery, buildings, &c., eight per cent. at least."

I shall have occasion again to recur to this report. I now proceed to examine as to the time and manner of the reduction of the duties proposed.

But, if they considered the tendency of high duties as In his message, the President recommends that the du injurious, why did they still ask to have them raised? ties should be reduced "as soon as a just regard to the There were, Mr. Chairman, some things which deeply faith of the Government, and to the preservation of the affected the interest of manufacturers, between 1824 and large capital invested in establishments of domestic indus1828, to which I ask the attention of this committee. I try, will permit." The Secretary of the Treasury recogadmit, with the gentleman from New York, [Mr. HoFF nises "the necessity of adapting the proposed changes to MAN,] that one of these was the sudden rush of capital the safety of existing establishments, raised up under the into the business of manufactures, without much skill or auspices of past legislation," though he does not recog calculation. But, sir, this is one of the unavoidable ef- nise that it is founded on the faith of the Government. fects of legislation; indirect, it is true, but not the less He says, "it arises rather from a prudent regard to the unavoidable. That cause, however, is not likely to occur rights and interests of the whole community, than from again. This, however, was not the great cause of their any absolute pledge of the national faith, uncontrolled by distress at that period. Another cause affected them circumstances." And, further, he recommends the remore deeply; the depression of prices in the European duction "to take place" (not immediately, but) " after markets, produced, in part, by the competition between the year 1833." But, sir, all that can be found in the reour manufactures and theirs. The same cause has been port of the Committee of Ways and Means that looks to operating constantly since, and has reduced the price of the safety of existing establishments is, that, "to guard some fabrics to the lowest cost of production. against a sudden fluctuation of the price of goods, whe

tion of the revenue at this time.

I regret, Mr. Chairman, that the committee, in taking ther in the hands of the merchant, the retailer, or the ma the tariff of 1816 as a basis, had not adopted its spirit nufacturer," they have made the reduction upon the more rather than its form. That act was accompanied by a important protected articles gradual and progressive. report from the then Secretary of the Treasury, which The principle of protection seems to have lost strength, lays down a principle peculiarly applicable to the reduc- gradually and progressively, as it has passed down, until, in the report of the committee, it is very nearly extinct. "The American manufactures," says Mr. Dallas, I will now, Mr. Chairman, call the attention of the com "may be satisfactorily divided into three classes; allowing mittee to the bill, for the purpose of seeing whether the for such diversities of shades as will seem to render the reduction, as therein proposed, is consistent "with the classification of particular manufactures doubtful or ar- safety of existing establishments.' bitrary. This bill proposes to reduce the revenue (taking the "First Class-Manufactures which are firmly and importations of 1831 as the basis of calculation:) permanently established, and which wholly, or almost For the year commencing 2d March, 1833, wholly, supply the demand for domestic use and con- For the year commencing 2d March, 1854, sumption. For the year commencing 2d March, 1835,

"Second Class.-Manufactures which, being recently or partially established, do not, at present, supply the demand for domestic use and consumption; but which,

$2,478,764

2,976,554

657,953

$6,093,271

The Tariff Bill.

stock in market. At these reduced prices, their ma$2,584,017nufactures again come in competition with ours, and ours 2,812,862 in competition with each other. The prices are thus depressed in our markets: this, and our increasing the supply, again react on the foreign market, and this action and reaction continually operate, until prices are brought down to the lowest rate of profit on the cost of produc tion. In the article of coarse cottons, this action and reaction have produced their ultimate effect. It is now admitted that we make that article as cheap as any foreign nation; that we export it, and are able successfully to compete with all the world in foreign markets. And this is the tendency of protection in all our manufactures.

H. OF R.

Woollens.

Moulton & Cummins,

Sturtevant,

Gookin,

J. Downer,
Cottons.

J. Lyman,

paper, I am unable to say; but I will exculpate the person Profit for who signed it, the late Mr. Bayley, a man whose integrity no one ever questioned. He did not collect the evidence, but only collated it. From the result of this examination, I shall receive, and I think this committee ought to re ceive, with distrust, selected portions of evidence from these reports of the treasury agents.

40

3,500 5,467

33

25,000 20,300 21

21

The gentleman has hazarded, I think he used the word, has hazarded the opinion that the wool growers have not been benefited by the protecting duties; that the prices have not been raised by them. Sir, I wish, as he was using the paper as evidence, he had read the concluding paragraph of Mr. Bayley's report. I will read it: "The price at which wool has been sold has been greatly in creased, and perhaps doubled, since the year 1828, and the increase of price is to be attributed chiefly to the

And here, as to woollens and cottons, the gentleman stopped his reading. The impression which the committee received was, that this exhibited the state of the profits of the woollen and cotton manufactures in the State of tariff of that year.' Vermont; and the gentleman noticed the impression by I have examined this book, as far as I have had leisure the remark, that the statement "produced a flutter- to do, in part only, I have found nothing to warrant a reing." I confess in me it created emotions of surprise duction of duties at this time. I believe the average pro and of pleasure--surprise, that I had been so ill in- fits in the woollens for the last three years will not be formed of the state of manufactures in Vermont--of found to have exceeded seven per cent., as stated by Mr. pleasure, to find them in so prosperous a condition. Sir, Tuft, nothing for 1829, fifteen per cent. for 1830, (a sinwith your leave, I will cross-examine the witness-the gle profitable year,) and six for 1831. What they are paper. And the first question is, has it testified to us the whole truth? Its answer is, no; it has only answered such questions as have been asked. On the very same page, under Windsor county, I read the following:

Woollens.

N. B. Hazen,
Kidder & Nichols,
Perkinsville Co.

On another page,

J. Sherwood,

Cottons.

Marshals,

6527

67

entitled to is a fair permanent profit and no more; short of this they cannot be sustained, without pressing down the price of labor, and of the raw material, the fruit of labor. If the laborer will consent to reduce the price of his labor, and if the wool grower will consent to reduce the price of his wool, the manufacturer can consent to a reduction of protection; but whatever shall reduce the manufacturer below fair profit, must in the end be brought home to the laborer and the farmer. We are embarked in one inseparable interest.

Am I understood to say "that manufactures can bear no reduction of duties?" Sir, I should be very glad to know that they can. But what I mean to say is, that! have no evidence on which I can, at this time, act; and without such information, the stake is too large, the haz ard too great. The interest involved in the wool grow ing and manufactures of wool cannot be less than 175,000,000 of dollars, extending throughout the Eastern, Middle, and Western States. Some of the consequences of breaking up this great interest, and manufactures generally, are faithfully described in the document before me, (No. 308.) "The effect is obvious to the most superficial inquirer. What must men do, when thrown out of I have a word to say, however, as to the first statement employment? Seek a new one. Now every branch of read by the gentleman. The cases of Sturtevant and business being stocked with laborers, recourse must be Gookin are one factory, put in by each partner: this mis- had to the land. A great many must be satisfied with take appears on the face of the paper. This factory what they can produce therefrom. Flax must be raised, works not on its own account, but under a contract. Such and substituted for cotton: enough of wool must be raised is my belief. With the operations of the first (Moulton for the consumption of each family; and no more will be and Cummins) I am unacquainted. I hope its profits wanted, as there will be no purchasers. They must make are not overrated. I should like, however, to see how their own clothing, not having the means of purchasing, the account is made up; whether the agency of the own-in consequence of being thrown out of employment. ers, loss by bad debts, insurance, wear and tear of machi- Notwithstanding cotton and woollen goods can be pur nery, &c. are taken into the account. I have inquired chased for less than they can manufacture them, necessity for the original statements, but have been unable to ob- will compel them to clothe themselves from their tain them. In relation to the cotton factory, set to J. productions. Real estate in seaport towns and village Lyman, within my knowledge it is all a mistake. In would fall very much: in manufacturing villages it would 1829 the factories of J. and E. Lyman were both (a large be worth little or nothing. Trade would diminish gene brick and a small wooden one) sold at auction, (the ma rally to an extent little apprehended by those who have chinery all being taken out,) at 14 or 15,000 dollars, to not examined this subject. And the shipping interest J. Lyman. The brick factory was not in operation when would suffer exceedingly. In proportion to the extent this tabular statement was made-(May, 1832.) The of breaking up manufacturing establishments, these f wooden factory was put in operation under a lease in fects would be felt."-(Letter of James Horton.) 1830 or 1831; and yet these are represented as having a I come now, Mr. Chairman, to the examination of a capital of 45,000 dollars, and having netted a profit of 21 feature in the bill more exceptionable than any one to

per cent. for the three years preceding 1831. Nor can which I have alluded, affecting immediately, and most fa I any better account for the general uniformity of the tally, in my opinion, not only the existence of the existing rate of profit of the last three years, contrary to the manufacturing establishments, but the whole commercial, known fact. How this statement found its way into the land, indeed, every interest in the country.