THE TARIFF, AND AMERICAN SYSTEM.
The revision of the Tariff, with a view to the protection of home
industry, and to the establishment of what was then called, "The
American System," was one of the large subjects before Congress
at the session 1823-24, and was the regular commencement of the
heated debates on that question which afterwards ripened into a
serious difficulty between the federal government and some of the
southern States. The presidential election being then depending,
the subject became tinctured with party politics, in which, so far
as that ingredient was concerned, and was not controlled by other
considerations, members divided pretty much on the line which always
divided them on a question of constructive powers. The protection
of domestic industry not being among the granted powers, was looked
for in the incidental; and denied by the strict constructionists
to be a substantive power, to be exercised for the direct purpose
of protection; but admitted by all at that time, and ever since
the first tariff act of 1789, to be an incident to the revenue
raising power, and an incident to be regarded in the exercise of
that power. Revenue the object, protection the incident, had been
the rule in the earlier tariffs: now that rule was sought to be
reversed, and to make protection the object of the law, and revenue
the incident. The revision, and the augmentation of duties which it
contemplated, turned, not so much on the emptiness of the treasury
and the necessity for raising money to fill it, as upon the distress
of the country, and the necessity of creating a home demand for
labor, provisions and materials, by turning a larger proportion of
our national industry into the channel of domestic manufactures.
Mr. Clay, the leader in the proposed revision, and the champion of
the American System, expressly placed the proposed augmentation of
duties on this ground; and in his main speech upon the question,
dwelt upon the state of the country, and gave a picture of the
public distress, which deserves to be reproduced in this VIEW of
the working of our government, both as the leading argument for the
new tariff, and as an exhibition of a national distress, which
those who were not cotemporary with the state of things which he
described, would find it difficult to conceive or to realize. He
said:
"In casting our eyes around us, the most prominent circumstance
which fixes our attention and challenges our deepest regret,
is the general distress which pervades the whole country. It
is forced upon us by numerous facts of the most incontestable
character. It is indicated by the diminished exports of native
produce; by the depressed and reduced state of our foreign
navigation; by our diminished commerce; by successive unthreshed
crops of grain perishing in our barns for want of a market;
by the alarming diminution of the circulating medium; by the
numerous bankruptcies; by a universal complaint of the want
of employment, and a consequent reduction of the wages of
labor; by the ravenous pursuit after public situations, not
for the sake of their honors, and the performance of their
public duties, but as a means of private subsistence; by the
reluctant resort to the perilous use of paper money; by the
intervention of legislation in the delicate relation between
debtor and creditor; and, above all, by the low and depressed
state of the value of almost every description of the whole
mass of the property of the nation, which has, on an average,
sunk not less than about fifty per centum within a few years.
This distress pervades every part of the Union, every class
of society; all feel it, though it may be felt, at different
places, in different degrees. It is like the atmosphere which
surrounds us: all must inhale it, and none can escape from it.
A few years ago, the planting interest consoled itself with
its happy exemptions from the general calamity; but it has now
reached this interest also, which experiences, though with less
severity, the general suffering. It is most painful to me to
attempt to sketch, or to dwell on the gloom of this picture. But
I have exaggerated nothing. Perfect fidelity to the original
would have authorized me to have thrown on deeper and darker
hues."
Mr. Clay was the leading speaker on the part of the bill in the
House of Representatives, but he was well supported by many able
and effective speakers--by Messrs. Storrs, Tracy, John W. Taylor,
from New-York; by Messrs. Buchanan, Todd, Ingham, Hemphill, Andrew
Stewart, from Pennsylvania; by Mr. Louis McLane, from Delaware;
by Messrs. Buckner F. Johnson, Letcher, Metcalfe, Trimble, White
Wickliffe, from Kentucky; by Messrs. Campbell, Vance, John W.
Wright, Vinton, Whittlesey, from Ohio; Mr. Daniel P. Cook, from
Illinois.
Mr. Webster was the leading speaker on the other side, and disputed
the universality of the distress which had been described; claiming
exemption from it in New England; denied the assumed cause for it
where it did exist, and attributed it to over expansion and collapse
of the paper system, as in Great Britain, after the long suspension
of the Bank of England; denied the necessity for increased
protection to manufactures, and its inadequacy, if granted, to the
relief of the country where distress prevailed; and contested the
propriety of high or prohibitory duties, in the present active
and intelligent state of the world, to stimulate industry and
manufacturing enterprise. He said:
"Within my own observation, there is no cause for such gloomy
and terrifying a representation. In respect to the New England
States, with the condition of which I am best acquainted, they
present to me a period of very general prosperity. Supposing
the evil then to be a depression of prices, and a partial
pecuniary pressure; the next inquiry is into the causes of
that evil. A depreciated currency existed in a great part of
the country--depreciated to such a degree as that, at one
time, exchange between the centre and the north was as high as
twenty per cent. The Bank of the United States was instituted
to correct this evil; but, for causes which it is not now
necessary to enumerate, it did not for some years bring back
the currency of the country to a sound state. In May, 1819, the
British House of Commons, by an unanimous vote, decided that
the resumption of cash payments by the Bank of England should
not be deferred beyond the ensuing February (it had then been
in a state of suspension near twenty-five years). The paper
system of England had certainly communicated an artificial
value to property. It had encouraged speculation, and excited
overtrading. When the shock therefore came, and this violent
pressure for money acted at the same moment on the Continent
and in England, inflated and unnatural prices could be kept up
no longer. A reduction took place, which has been estimated to
have been at least equal to a fall of thirty, if not forty, per
cent. The depression was universal; and the change was felt in
the United States severely, though not equally so in every part
of them. About the time of these foreign events, our own bank
system underwent a change; and all these causes, in my view of
the subject, concurred to produce the great shock which took
place in our commercial cities, and through many parts of the
country. The year 1819 was a year of numerous failures, and
very considerable distress, and would have furnished far better
grounds than exist at present for that gloomy representation
which has been presented. Mr. Speaker (Clay) has alluded to
the strong inclination which exists, or has existed, in various
parts of the country, to issue paper money, as a proof of great
existing difficulties. I regard it rather as a very productive
cause of those difficulties; and we cannot fail to observe,
that there is at this moment much the loudest complaint of
distress precisely where there has been the greatest attempt
to relieve it by a system of paper credit. Let us not suppose
that we are _beginning_ the protection of manufactures by
duties on imports. Look to the history of our laws; look to the
present state of our laws. Consider that our whole revenue,
with a trifling exception, is collected from the custom-house,
and always has been; and then say what propriety there is in
calling on the government for protection, as if no protection
had heretofore been afforded. On the general question, allow me
to ask if the doctrine of prohibition, as a general doctrine,
be not preposterous? Suppose all nations to act upon it: they
would be prosperous, then, according to the argument, precisely
in the proportion in which they abolished intercourse with one
another. The best apology for laws of prohibition and laws of
monopoly, will be found in that state of society, not only
unenlightened, but sluggish, in which they are most generally
established. Private industry in those days, required strong
provocatives, which government was seeking to administer by
these means. Something was wanted to actuate and stimulate men,
and the prospects of such profits as would, in our times, excite
unbounded competition, would hardly move the sloth of former
ages. In some instances, no doubt, these laws produced an effect
which, in that period, would not have taken place without them.
(Instancing the protection to the English woollen manufactures
in the time of the Henrys and the Edwards). But our age is
wholly of a different character, and its legislation takes
another turn. Society is full of excitement: competition comes
in place of monopoly; and intelligence and industry ask only for
fair play and an open field."
With Mr. Webster were numerous and able speakers on the side of
free trade: From his own State, Mr. Baylies; from New-York, Mr.
Cambreling; from Virginia, Messrs. Randolph, Philip P. Barbour,
John S. Barbour, Garnet, Alexander Smythe, Floyd, Mercer, Archer,
Stevenson, Rives, Tucker, Mark Alexander; from North Carolina,
Messrs. Mangum, Saunders, Spaight, Lewis Williams, Burton, Weldon
N. Edwards; from South Carolina, Messrs. McDuffie, James Hamilton,
Poinsett; from Georgia, Messrs. Forsyth, Tatnall, Cuthbert, Cobb;
from Tennessee, Messrs. Blair, Isaaks, Reynolds; from Louisiana,
Mr. Edward Livingston; from Alabama, Mr. Owen; from Maryland, Mr.
Warfield; from Mississippi, Mr. Christopher Rankin.
The bill was carried in the House, after a protracted contest of ten
weeks, by the lean majority of five--107 to 102--only two members
absent, and the voting so zealous that several members were brought
in upon their sick couches. In the Senate the bill encountered a
strenuous resistance. Mr. Edward Lloyd, of Maryland, moved to refer
it to the committee on finance--a motion considered hostile to the
bill; and which was lost by one vote--22 to 23. It was then, on the
motion of Mr. Dickerson, of New Jersey, referred to the committee
on manufactures; a reference deemed favorable to the bill, and by
which committee it was soon returned to the Senate without any
proposed amendment. It gave rise to a most earnest debate, and many
propositions of amendment, some of which, of slight import, were
carried. The bill itself was carried by the small majority of four
votes--25 to 21. The principal speakers in favor of the bill were:
Messrs. Dickerson, of New Jersey; D'Wolf, of Rhode Island; Holmes,
of Maine; E. M. Johnson, of Kentucky; Lowrie, of Pennsylvania;
Talbot, of Kentucky; Van Buren. Against it the principal speakers
were: Messrs. James Barbour and John Taylor, of Virginia (usually
called John Taylor of Caroline); Messrs. Branch, of North Carolina;
Hayne, of South Carolina; Henry Johnson and Josiah Johnston, of
Louisiana; Kelly and King, of Alabama; Rufus King, of New-York;
James Lloyd, of Massachusetts; Edward Lloyd and Samuel Smith, of
Maryland; Macon, of North Carolina; Van Dyke, of Delaware. The bill,
though brought forward avowedly for the protection of domestic
manufactures, was not entirely supported on that ground. An increase
of revenue was the motive with some, the public debt being still
near ninety millions, and a loan of five millions being authorized
at that session. An increased protection to the products of several
States, as lead in Missouri and Illinois, hemp in Kentucky, iron in
Pennsylvania, wool in Ohio and New-York, commanded many votes for
the bill; and the impending presidential election had its influence
in its favor. Two of the candidates, Messrs. Adams and Clay, were
avowedly for it; General Jackson, who voted for the bill, was for
it, as tending to give a home supply of the articles necessary in
time of war, and as raising revenue to pay the public debt. Mr.
Crawford was opposed to it; and Mr. Calhoun had been withdrawn from
the list of presidential candidates, and become a candidate for
the Vice-Presidency. The Southern planting States were extremely
dissatisfied with the passage of the bill, believing that the new
burdens upon imports which it imposed fell upon the producers of
the exports, and tended to enrich one section of the Union at the
expense of another. The attack and support of the bill took much of
a sectional aspect; Virginia, the two Carolinas, Georgia, and some
others being nearly unanimous against it. Pennsylvania, New-York,
Ohio, Kentucky being nearly unanimous for it. Massachusetts, which
up to this time had a predominating interest in commerce, voted
all, except one member, against it. With this sectional aspect,
a tariff for protection also began to assume a political aspect,
being taken under the care of the party since discriminated as Whig,
which drew from Mr. Van Buren a sagacious remark, addressed to the
manufacturers themselves; that if they suffered their interests
to become identified with a political party (any one), they would
share the fate of that party, and go down with it whenever it sunk.
Without the increased advantages to some States, the pendency of the
presidential election, and the political tincture which the question
began to receive, the bill would not have passed--so difficult is
it to prevent national legislation from falling under the influence
of extrinsic and accidental causes. The bill was approved by Mr.
Monroe--a proof that that careful and strict constructionist of
the Constitution did not consider it as deprived of its revenue
character by the degree of protection which it extended.