III. HOW PROTECTION UNDERTAKES TO PROTECT. Not very long ago protection used to be carried on by absolutely prohibiting the importation of certain classes of foreign goods. But no one ventures to propose any such straightforward method in this country, except with regard to ships. Those are prohibited from coming under the American flag on any terms; and a pretty business has been made of our shipping by such protection, for it is protected to the point of death; and invitations to the funeral are already out. The only method of protecting American manufacturers, other than ships, consists of a protective tariff. What is that? It is a law by which, under the pretense of collecting taxes for the support of the general government, those taxes are so levied that as little money as can possibly be contrived shall go to the government, and as much as possible shall go into the pockets of a few private persons, for their own use. Now, if an act were passed, declaring this object on its face, as for example, thus: "Be it enacted, that every person presuming to purchase iron in Europe, shall pay 50 per cent. of its value to D. J. Morrell, and every person buying steel rails in Europe shall pay 100 per cent. of their value to O. W. Potter of Illinois, for the encouragement of the said Morrell & Potter in their laudable industry," such an act would be at once held unconstitutional and void as mere robbery. You could not get even the present Congress, bad as it is, to pass any such statute as that. But when an act is passed which provides for the same amount of taxation, with a full knowledge that the effect of it will be, not to put that sum of money into the government treasury, but to put it into the pockets of Mr. Morrell and Mr. Potter, and with the avowed intent of producing that result; then, not only is such a law held to be perfectly constitutional, but it is considered perfectly proper for Mr. Morrell to get a seat in Congress and vote, as he did for just such a bill, putting just so much money into his own personal pocket. Protection is a "blind pool." Few understand what a "blind pool" is; but it is a phrase well understood among speculators. John Smith, for example, having obtained the confidence of a large number of speculators, informs them that he has a scheme in his mind by which enormous profits can be made, but which requires the investment of a large amount of capital on terms of absolute secrecy. If (he says) he were to tell any human being what use he made of the money, not merely when he bought and when he sold, but even what he intended to buy and sell, rival speculators would put up the price of the subject of speculation to such a degree as would make it useless for him to attempt any thing. A well-known gentleman in New York, about two years ago, proposed a blind pool of this kind to his friends; and in less than two days over $17,000,000 were subscribed, of which he accepted only $7,000,000, and used it for sev eral months without giving one of the investors a hint as to where the money had gone or when it would come back. In the end, the transaction proved very profitable to all concerned. But, of course, this gentleman acted under many restraints. Not only was his high reputation a guarantee for the propriety of his action, but everybody knew that sooner or later he could be compelled to account for every dollar of the money by legal proceedings, and could, after a reasonable lapse of time, be required to show exactly what he had bought, and at what price, and when and at what price he had sold. Now, protection is a blind pool of this kind, with three important points of difference. 1. You know nothing whatever of the character or reputation of the men to whom you entrust your money; indeed, you do not even know their names. 2. You not only have no legal right whatever, to enquire what they have done with your money; but you have an absolute certainty that no such account will ever be given to you or to any one else. 3. Even if the persons who took your money were ever so much inclined to give you an account of the profits made on the transaction, and to tell you what they have done with your money, they could not possibly do it. Protection consists in a heavy tax levied upon all the people of this country, in a proportion bearing ten times as heavily on the poor as on the rich, under an assurance that, in some mysterious way, a large profit will be made upon these taxes, which will be redistributed among us all in like proportions. We are assured that this heavy taxation is necessary to enable manufacturers to pay high wages to their workmen, that these workmen in their turn will pay good prices to the farmers and shop-keepers for what they eat, drink, and wear, and that thus we shall all make money by being taxed. Under this assurance, the manufacturers tax you as much as they like; they give to their workmen only just so much. as they like; and the workmen pay to the farmers and shopkeepers no more than they can possibly help. Nobody knows exactly what manufacturers receive the benefit of these taxes; nobody knows precisely what profit they make out of them; nobody knows precisely what wages they pay their workmen; everybody knows that they do not pay their workmen a penny more than other employers pay, who get none of these taxes; and there is not in the whole land one human being who could, if he would, show you where one single penny of the benefit positively comes back from these heavy taxes to anybody except a few thousand manufacturers. But, undoubtedly, these manufacturers are honorable men; their intentions are very good; and they assure you continually that their only motive for taxing you so heavily is to pay you larger profits in some mysterious way, which they do not themselves understand, but which they are quite sure would be satisfactory to you, if you could only understand it. Now, let me put may hands in your pockets, as you let the protected manufacturers do. You give to them about one-quarter of all that you earn, on the strength of somebody's assurance that you will get it all back with a profit. This " somebody" you do not know. You never did see him, and you never will. You cannot give me the name of any one man who will make that assurance on his own responsibility. He gives you no security; indeed, he does not give you his personal promise. He simply tells you that "it must be so." Now, give to me another quarter of your earnings. I am no anonymous protectionist. I am not a newspaper article without signature, which is really all the guaranty that you have for the return of the quarter of your earnings which you now give up. Give me a quarter of your earnings, and I will give you my written guaranty to use them for your advantage, charging for my services only half the commission that manufacturers do—say 3 per cent. a year. More than that: I will give bonds, signed by some of the wealthiest men in New York, in four times the amount of any money you put in my hands, to account for it and to invest it for your benefit, only reserving the right to use it in my own discretion. Why do you not rise up and accept this offer? Perhaps you are not entirely satisfied with me. Well, I will procure you the same offer from almost any other person whom you may name. I will get a bank to do it for you. Why do you not accept this offer? Because, of course, you all know that you would be fools if you did. You know very well that neither I nor any one else can possibly use your earnings to as much advantage for you as you can yourselves. Some surplus money you may be willing to invest; but even then you prefer to lend it out at inter est on good security. You would not let any one take your earnings for the mere purpose of speculation, with no other security than a promise that he would give you such part of the profits as he saw fit, in case of his success. Yet you allow one quarter of your earnings to be taken every year for the purpose of speculation, by men who give you no security and not even a promise to divide their profits with you, and whose names you never know, and can never find out. Who says that faith is extinct in the Nineteenth Century? IV.-WHO PAYS FOR PROTECTION ? Many persons are persuaded that protective duties are either not taxes at all or else are all paid by foreign producers. A western schoolboy declared that the $200,000,000 levied by the tariff were all paid to us by England; and thousands of people, who ought be in school, believe the same thing. In 1881 the duty on the best Let us look at this point. plate glass was 112 per cent. Belgium for $386,000, was imported here, and $437,000 duty was paid upon it. It was then sold here for over $850,000. Who paid the duty? Did the Belgium manufacturer? If he did, then out of $386,000 which was all he got for the glass, he paid $437,000 to our government for the privilege of sending it here. In other words, he gave us his glass for nothing, when he could have sold it at home for $386,000; and he gave us $51,000 more for leave to do so! On several articles duties were paid over 200 per cent. On this theory the foreign producer gave us the goods for nothing, and paid us a bonus of double the value of the goods to take them off his hands! nonsense who is silly enough to do so. Let any one believe such But the duties on some things are so heavy that they are not imported at all. That is the case with the cheapest kind of woolen goods, used by the poor. The duty varies from |
