Vol. XIV.

No. 157.

CRUSADE.

HE vicious assaults of fanatical upon the

system would have no especial significance or little effect at the present time but for the support they are receiving from certain elements in the Republican party which have become so enamoured of the idea that a foreign market is the only really important and valuable one for the country that they seem determined to sacrifice protection, and even government revenue, to the extent of securing greater freedom of commercial intercourse with rival industrial nations. History is again repeating itself, for the present tariff is being attacked in the same reckless manner as was the McKinley tariff and with the same objects in view. In a recent article on the protective outlook, Robert Ellis Thompson says: "There is one element on which the free traders always can count in antagonizing our our national policy. That is the shortness of memory

which seems to afflict all republics. a Where a country has no hereditary class to serve as remembrancers there seems to be always a readiness to forget the experience of the past, and to repeat the very blunders which have cost it the most."

The theory upon which the present anti-protection movement is based is that some leading industries no longer need protection and that the smaller ones are not of sufficient consequence to be protected; that we are producing more than we can consume, which makes a larger export trade an absolute necessity; that some industries are getting too much protection and can conveniently dispense with a part of it; that we must have free raw materials of every description to promote and strengthen our export trade; and we must modify our tariff to secure a freer ex change of products with other coun tries to preclude their adopting meas ures of "retaliation" which would

limit our exports. As they are well aware that the sentiment of the country is opposed to general tariff revision at this time, we find them attacking the protective policy at every vulnerable point and giving their support to insidious special measures which are intended to make serious breaches in our tariff wall. The fact that their proposed experiments in tariff legislation are generally of the same character as those which have proved so disastrous to the country in low tariff periods has no restraining influence upon their purposes; and party pledges to maintain adequate protection for all industries that require it are treated by them with indifference and contempt. Dominated by a craze or greed for foreign markets, they have no concern for the interests of the home market. In short they have profited nothing from the lessons of experience and are altogether blind to the ultimate consequences of their ill-advised movement.

To a great extent their theories in regard to tariff conditions are fallacious. It may be true that a limited number of industries no longer need protection or at least that the stronger concerns in such industries do not; but the most of them still need it, and the interests of the many are more to be considered than the interests of the few. As Charles As Charles Heber Clark remarked in the Reciprocity Convention: "The right of the less fortunate manufacturer to continued protection is quite equal to that of the other man to make

gains for himself by mutilating the system that made him so strong." Furthermore, if a duty has become inoperative for either protection or revenue, as they claim, its retention. in the tariff can harm no one, and it seems hardly worth while to compel a general revision of the tariff to get rid of it.

The cry of "overproduction" is the twin bugbear of "foreign retaliation," and both are being used to frighten the American people into granting special favors to a few greedy exporters and to foreign producers. It is true that excessive competition in some manufacturing lines may create an inconvenient surplus, but the remedy for this is not to be found in a policy that would gain new markets abroad at the cost of increasing imports and sacrificing a part of the home market. Conservative and sagacious manufacturers conduct their operations with a prudent regard for prevailing conditions, and they do not "discount the future" by producing goods greatly in excess of the present or prospective requirements of the market. Under a stable and efficient protective tariff which mantains a high purchasing power, there is little danger of overproduction for the greater number of our industries, for when our manufacturers are able to control the home market they can the better adapt production to demand; but the real danger comes when, under a "freer trade policy," which the new foes of protection are clamoring for, there is a larger sub

stitution of the products of the world for our own and foreign producers are permitted more freely to dump their surplus goods into our market.

How do they know that any industry is getting too much protection? They do not admit that any duties are too low, and yet this may be the fact in not a few instances. Whether duties are too high or too low can only be determined by careful investigation by persons who are most familiar with the condition and needs of our industries; and the opinions of theoretical free traders in these matters are without particular value. This part of their theory seems wholly based upon the assumption that some concerns are selling their products abroad for a less price than they charge domestic consumers, and that a protective tariff enables them to do this; but as this has been the practice of producers under all tariffs, when trying to get or hold a foreign market and it is likewise the common practice of producers in all foreign countries, it therefore furnishes no argument against protection or for tariff reduction.

The theory that duties upon raw materials obstruct export trade is a delusion, except that they may limit the profits of such trade; but if protection is to be maintained in any case it must be conceded that the domestic producers of raw materials are entitled to it in no less degree than those who work the materials into manufactured goods, and they

may need it much more. It is found that our exports of woolen manufactures in 1896, under "free wool," amounted in value to only $913,000, but in the last fiscal year, with duties. on wool, they were over $1,500,000. Again, the exports of boots and shoes in 1896, under "free hides," were in value $1,436,686, but in the last fiscal year, with a duty on hides, they were $5,526,290.

The presumption seems quite reasonable that the field which produces the raw materials, or which imports them free of customs duty, should be the cheapest place where they may be worked up into manufactured goods; nevertheless, where the labor cost is high, as in the United States, it may not be possible even with the advantages afforded by improved machinery and better industrial methods to rival in cheapness of production countries where the cost of labor is from 30 to 75 per cent less. Thus the lower labor cost in some countries may in some instances more than offset the greater labor efficiency in other countries, and this fully explains the necessity for the continued need of protection against the competition of cheap labor countries.

The misguided people who are concocting schemes to undermine protection greatly overestimate the importance of external trade. To illustrate the current free trade misrepresentation of facts and conditions we quote this sentence from an editorial in the Boston Herald: "We are essentially dependent for our