A SPEECH DELIVERED IN THE HOUSE OF REPRESENTATIVES OF THE UNITED STATES,
ON THE 1ST AND 2D OF APRIL, 1824.
[At an early period of the session of Congress of 1823-24 a bill was
introduced into the House of Representatives to amend the several acts
laying duties on imports. The object of the bill was a comprehensive
revision of the existing laws, with a view to the extension of the
protective system. The bill became the subject of a protracted debate,
in which much of the talent of the House on both sides was engaged. Mr.
Webster took an active part in the discussion, and spoke upon many of
the details of the bill, while it remained in the committee of the whole
House on the state of the Union. Several objectionable provisions were
removed, and various amendments were introduced upon his motion; and it
was a matter of regret to him, as seen in the following speech, that the
friends of the bill were not able or willing to bring it into a form in
which, as a whole, he could give it his support. On the 30th and 31st of
March, Mr. Clay, Speaker of the House, addressed the committee of the
whole, at length and with great ability, on the general principles of
the bill; and he was succeeded by Mr. Webster, on the 1st and 2d of
April, in the following speech.]
MR. CHAIRMAN,--I will avail myself of the present occasion to make some
remarks on certain principles and opinions which have been recently
advanced, and on those considerations which, in my judgment, ought to
govern us in deciding upon the several and respective parts of this very
important and complex measure. I can truly say that this is a painful
duty. I deeply regret the necessity which is likely to be imposed upon
me of giving a general affirmative or negative vote on the whole of the
bill. I cannot but think this mode of proceeding liable to great
objections. It exposes both those who support and those who oppose the
measure to very unjust and injurious misapprehensions. There may be good
reasons for favoring some of the provisions of the bill, and equally
strong reasons for opposing others; and these provisions do not stand to
each other in the relation of principal and incident. If that were the
case, those who are in favor of the principal might forego their
opinions upon incidental and subordinate provisions. But the bill
proposes enactments entirely distinct and different from one another in
character and tendency. Some of its clauses are intended merely for
revenue; and of those which regard the protection of home manufactures,
one part stands upon very different grounds from those of other parts.
So that probably every gentleman who may ultimately support the bill
will vote for much which his judgment does not approve; and those who
oppose it will oppose something which they would very gladly support.
Being intrusted with the interests of a district highly commercial, and
deeply interested in manufactures also, I wish to state my opinions on
the present measure, not as on a whole, for it has no entire and
homogeneous character, but as on a collection of different enactments,
some of which meet my approbation and some of which do not.
And allow me, Sir, in the first place, to state my regret, if indeed I
ought not to express a warmer sentiment, at the names or designations
which Mr. Speaker[1] has seen fit to adopt for the purpose of describing
the advocates and the opposers of the present bill. It is a question, he
says, between the friends of an "American policy" and those of a
"foreign policy." This, Sir, is an assumption which I take the liberty
most directly to deny. Mr. Speaker certainly intended nothing invidious
or derogatory to any part of the House by this mode of denominating
friends and enemies. But there is power in names, and this manner of
distinguishing those who favor and those who oppose particular measures
may lead to inferences to which no member of the House can submit. It
may imply that there is a more exclusive and peculiar regard to American
interests in one class of opinions than in another. Such an implication
is to be resisted and repelled. Every member has a right to the
presumption, that he pursues what he believes to be the interest of his
country with as sincere a zeal as any other member. I claim this in my
own case; and while I shall not, for any purpose of description or
convenient arrangement use terms which may imply any disrespect to other
men's opinions, much less any imputation upon other men's motives, it is
my duty to take care that the use of such terms by others be not,
against the will of those who adopt them, made to produce a false
impression.
Indeed, Sir, it is a little astonishing, if it seemed convenient to Mr.
Speaker, for the purposes of distinction, to make use of the terms
"American policy" and "foreign policy," that he should not have applied
them in a manner precisely the reverse of that in which he has in fact
used them. If names are thought necessary, it would be well enough, one
would think, that the name should be in some measure descriptive of the
thing; and since Mr. Speaker denominates the policy which he recommends
"a new policy in this country"; since he speaks of the present measure
as a new era in our legislation; since he professes to invite us to
depart from our accustomed course, to instruct ourselves by the wisdom
of others, and to adopt the policy of the most distinguished foreign
states,--one is a little curious to know with what propriety of speech
this imitation of other nations is denominated an "American policy,"
while, on the contrary, a preference for our own established system, as
it now actually exists and always has existed, is called a "foreign
policy." This favorite American policy is what America has never tried;
and this odious foreign policy is what, as we are told, foreign states
have never pursued. Sir, that is the truest American policy which shall
most usefully employ American capital and American labor, and best
sustain the whole population. With me it is a fundamental axiom, it is
interwoven with all my opinions, that the great interests of the country
are united and inseparable; that agriculture, commerce, and manufactures
will prosper together or languish together; and that all legislation is
dangerous which proposes to benefit one of these without looking to
consequences which may fall on the others.
Passing from this, Sir, I am bound to say that Mr. Speaker began his
able and impressive speech at the proper point of inquiry,--I mean the
present state and condition of the country,--although I am so
unfortunate, or rather although I am so happy, as to differ from him
very widely in regard to that condition. I dissent entirely from the
justice of that picture of distress which he has drawn. I have not seen
the reality, and know not where it exists. Within my observation, there
is no cause for so gloomy and terrifying a representation. In respect to
the New England States, with the condition of which I am of course best
acquainted, the present appears to me a period of very general
prosperity. Not, indeed, a time for sudden acquisition and great
profits, not a day of extraordinary activity and successful
speculation. There is no doubt a considerable depression of prices, and,
in some degree, a stagnation of business. But the case presented by Mr.
Speaker was not one of _depression_, but of _distress_; of universal,
pervading, intense distress, limited to no class and to no place. We are
represented as on the very verge and brink of national ruin. So far from
acquiescing in these opinions, I believe there has been no period in
which the general prosperity was better secured, or rested on a more
solid foundation. As applicable to the Eastern States, I put this remark
to their representatives, and ask them if it is not true. When has there
been a time in which the means of living have been more accessible and
more abundant? When has labor been rewarded, I do not say with a larger,
but with a more certain success? Profits, indeed, are low; in some
pursuits of life, which it is not proposed to benefit, but to _burden_,
by this bill, very low. But still I am unacquainted with any proofs of
extraordinary distress. What, indeed, are the general indications of the
state of the country? There is no famine nor pestilence in the land, nor
war, nor desolation. There is no writhing under the burden of taxation.
The means of subsistence are abundant; and at the very moment when the
miserable condition of the country is asserted, it is admitted that the
wages of labor are high in comparison with those of any other country. A
country, then, enjoying a profound peace, perfect civil liberty, with
the means of subsistence cheap and abundant, with the reward of labor
sure, and its wages higher than anywhere else, cannot be represented as
in gloom, melancholy, and distress, but by the effort of extraordinary
powers of tragedy.
Even if, in judging of this question, we were to regard only those
proofs to which we have been referred, we shall probably come to a
conclusion somewhat different from that which has been drawn. Our
exports, for example, although certainly less than in some years, were
not, last year, so much below an average formed upon the exports of a
series of years, and putting those exports at a fixed value, as might be
supposed. The value of the exports of agricultural products, of animals,
of the products of the forest and of the sea, together with gunpowder,
spirits, and sundry unenumerated articles, amounted in the several years
to the following sums, viz.:--
In 1790, $27,716,152
1804, 33,842,316
1807, 38,465,854
Coming up now to our own times, and taking the exports of the years
1821, 1822, and 1823, of the same articles and products, at the same
prices, they stand thus:--
In 1821, $45,643,175
1822, 48,782,295
1823, 55,863,491
Mr. Speaker has taken the very extraordinary year of 1803, and, adding
to the exportation of that year what he thinks ought to have been a just
augmentation, in proportion to the increase of our population, he swells
the result to a magnitude, which, when compared with our actual exports,
would exhibit a great deficiency. But is there any justice in this mode
of calculation? In the first place, as before observed, the year 1803
was a year of extraordinary exportation. By reference to the accounts,
that of the article of flour, for example, there was an export that year
of thirteen hundred thousand barrels; but the very next year it fell to
eight hundred thousand, and the next year to seven hundred thousand. In
the next place, there never was any reason to expect that the increase
of our exports of agricultural products would keep pace with the
increase of our population. That would be against all experience. It is,
indeed, most desirable, that there should be an augmented demand for the
products of agriculture; but, nevertheless, the official returns of our
exports do not show that absolute want of all foreign market which has
been so strongly stated.
But there are other means by which to judge of the general condition of
the people. The quantity of the means of subsistence consumed, or, to
make use of a phraseology better suited to the condition of our own
people, the quantity of the comforts of life enjoyed, is one of those
means. It so happens, indeed, that it is not so easy in this country as
elsewhere to ascertain facts of this sort with accuracy. Where most of
the articles of subsistence and most of the comforts of life are taxed,
there is, of course, great facility in ascertaining, from official
statements, the amount of consumption. But in this country, most
fortunately, the government neither knows, nor is concerned to know, the
annual consumption; and estimates can only be formed in another mode,
and in reference only to a few articles. Of these articles, tea is one.
It is not quite a luxury, and yet is something above the absolute
necessaries of life. Its consumption, therefore, will be diminished in
times of adversity, and augmented in times of prosperity. By deducting
the annual export from the annual import, and taking a number of years
together, we may arrive at a probable estimate of consumption. The
average of eleven years, from 1790 to 1800, inclusive, will be found to
be two millions and a half of pounds. From 1801 to 1812, inclusive, the
average was three millions seven hundred thousand; and the average of
the last three years, to wit, 1821, 1822, and 1823, was five millions
and a half. Having made a just allowance for the increase of our
numbers, we shall still find, I think, from these statements, that there
is no distress which has limited our means of subsistence and enjoyment.
In forming an opinion of the degree of general prosperity, we may
regard, likewise, the progress of internal improvements, the investment
of capital in roads, bridges, and canals. All these prove a balance of
income over expenditure; they afford evidence that there is a surplus of
profits, which the present generation is usefully vesting for the
benefit of the next. It cannot be denied, that, in this particular, the
progress of the country is steady and rapid.
We may look, too, to the sums expended for education. Are our colleges
deserted? Do fathers find themselves less able than usual to educate
their children? It will be found, I imagine, that the amount paid for
the purpose of education is constantly increasing, and that the schools
and colleges were never more full than at the present moment. I may add,
that the endowment of public charities, the contributions to objects of
general benevolence, whether foreign or domestic, the munificence of
individuals towards whatever promises to benefit the community, are all
so many proofs of national prosperity. And, finally, there is no
defalcation of revenue, no pressure of taxation.
The general result, therefore, of a fair examination of the present
condition of things, seems to me to be, that there is a considerable
depression of prices, and curtailment of profit; and in some parts of
the country, it must be admitted, there is a great degree of pecuniary
embarrassment, arising from the difficulty of paying debts which were
contracted when prices were high. With these qualifications, the general
state of the country may be said to be prosperous; and these are not
sufficient to give to the whole face of affairs any appearance of
general distress.
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;
and it appears to me that there are several; and in this respect, I
think, too much has been imputed by Mr. Speaker to the single cause of
the diminution of exports. Connected, as we are, with all the commercial
nations of the world, and having observed great changes to take place
elsewhere, we should consider whether the causes of those changes have
not reached us, and whether we are not suffering by the operation of
them, in common with others. Undoubtedly, there has been a great fall in
the price of all commodities throughout the commercial world, in
consequence of the restoration of a state of peace. When the Allies
entered France in 1814, prices rose astonishingly fast, and very high.
Colonial produce, for instance, in the ports of this country, as well as
elsewhere, sprung up suddenly from the lowest to the highest extreme. A
new and vast demand was created for the commodities of trade. These were
the natural consequences of the great political changes which then took
place in Europe.
We are to consider, too, that our own war created new demand, and that a
government expenditure of twenty-five or thirty million dollars a year
had the usual effect of enhancing prices. We are obliged to add, that
the paper issues of our banks carried the same effect still further. A
depreciated currency existed in a great part of the country; depreciated
to such an extent, 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
necessary now to enumerate, it did not for some years bring back the
currency of the country to a sound state. This depreciation of the
circulating currency was so much, of course, added to the nominal prices
of commodities, and these prices, thus unnaturally high, seemed, to
those who looked only at the appearance, to indicate great prosperity.
But such prosperity is more specious than real. It would have been
better, probably, as the shock would have been less, if prices had
fallen sooner. At length, however, they fell; and as there is little
doubt that certain events in Europe had an influence in determining the
time at which this fall took place, I will advert shortly to some of the
principal of those events.
In May, 1819, the British House of Commons decided, by a unanimous vote,
that the resumption of cash payments by the Bank of England should not
be deferred beyond the ensuing February. The restriction had been
continued from time to time, and from year to year, Parliament always
professing to look to the restoration of a specie currency whenever it
should be found practicable. Having been, in July, 1818, continued to
July, 1819, it was understood that, in the interim, the important
question of the time at which cash payments should be resumed should be
finally settled. In the latter part of the year 1818, the circulation of
the bank had been greatly reduced, and a severe scarcity of money was
felt in the London market. Such was the state of things in England. On
the Continent, other important events took place. The French Indemnity
Loan had been negotiated in the summer of 1818, and the proportion of it
belonging to Austria, Russia, and Prussia had been sold. This created an
unusual demand for gold and silver in those countries. It has been
stated, that the amount of the precious metals transmitted to Austria
and Russia in that year was at least twenty millions sterling. Other
large sums were sent to Prussia and to Denmark. The effect of this
sudden drain of specie, felt first at Paris, was communicated to
Amsterdam and Hamburg, and all other commercial places in the North of
Europe.
The paper system of England had certainly communicated an artificial
value to property. It had encouraged speculation, and excited
over-trading. 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. There are those, I am aware, who maintain that the events
to which I have alluded did not cause the great fall of prices, but that
that fall was natural and inevitable, from the previously existing state
of things, the abundance of commodities, and the want of demand. But
that would only prove that the effect was produced in another way,
rather than by another cause. If these great and sudden calls for money
did not reduce prices, but prices fell, as of themselves, to their
natural state, still the result is the same; for we perceive that, after
these new calls for money, prices could not be kept longer at their
unnatural height.
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
in 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 of
our condition which has been presented. Mr. Speaker 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 the committee will not 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 systems of paper
credit. And, on the other hand, content, prosperity, and happiness are
most observable in those parts of the country where there has been the
least endeavor to administer relief by law. In truth, nothing is so
baneful, so utterly ruinous to all true industry, as interfering with
the legal value of money, or attempting to raise artificial standards to
supply its place. Such remedies suit well the spirit of extravagant
speculation, but they sap the very foundation of all honest acquisition.
By weakening the security of property, they take away all motive for
exertion. Their effect is to transfer property. Whenever a debt is
allowed to be paid by any thing less valuable than the legal currency in
respect to which it was contracted, the difference between the value of
the paper given in payment and the legal currency is precisely so much
property taken from one man and given to another, by legislative
enactment.
When we talk, therefore, of protecting industry, let us remember that
the first measure for that end is to secure it in its earnings; to
assure it that it shall receive its own. Before we invent new modes of
raising prices, let us take care that existing prices are not rendered
wholly unavailable, by making them capable of being paid in depreciated
paper. I regard, Sir, this issue of irredeemable paper as the most
prominent and deplorable cause of whatever pressure still exists in the
country; and, further, I would put the question to the members of this
committee, whether it is not from that part of the people who have tried
this paper system, and tried it to their cost, that this bill receives
the most earnest support? And I cannot forbear to ask, further, whether
this support does not proceed rather from a general feeling of
uneasiness under the present condition of things, than from the clear
perception of any benefit which the measure itself can confer? Is not
all expectation of advantage centred in a sort of vague hope, that
change may produce relief? Debt certainly presses hardest where prices
have been longest kept up by artificial means. They find the shock
lightest who take it soonest; and I fully believe that, if those parts
of the country which now suffer most had not augmented the force of the
blow by deferring it, they would have now been in a much better
condition than they are. We may assure ourselves, once for all, Sir,
that there can be no such thing as payment of debts by legislation. We
may abolish debts indeed; we may transfer property by visionary and
violent laws. But we deceive both ourselves and our constituents, if we
flatter either ourselves or them with the hope that there is any relief
against whatever pressure exists, but in economy and industry. The
depression of prices and the stagnation of business have been in truth
the necessary result of circumstances. No government could prevent them,
and no government can altogether relieve the people from their effect.
We have enjoyed a day of extraordinary prosperity; we had been neutral
while the world was at war, and had found a great demand for our
products, our navigation, and our labor. We had no right to expect that
that state of things would continue always. With the return of peace,
foreign nations would struggle for themselves, and enter into
competition with us in the great objects of pursuit.
Now, Sir, what is the remedy for existing evils? What is the course of
policy suited to our actual condition? Certainly it is not our wisdom to
adopt any system that may be offered to us, without examination, and in
the blind hope that whatever changes our condition may improve it. It is
better that we should
"bear those ills we have,
Than fly to others that we know not of."
We are bound to see that there is a fitness and an aptitude in whatever
measures may be recommended to relieve the evils that afflict us; and
before we adopt a system that professes to make great alterations, it is
our duty to look carefully to each leading interest of the community,
and see how it may probably be affected by our proposed legislation.
And, in the first place, what is the condition of our commerce? Here we
must clearly perceive, that it is not enjoying that rich harvest which
fell to its fortune during the continuance of the European wars. It has
been greatly depressed, and limited to small profits. Still, it is
elastic and active, and seems capable of recovering itself in some
measure from its depression. The shipping interest, also, has suffered
severely, still more severely, probably, than commerce. If any thing
should strike us with astonishment, it is that the navigation of the
United States should be able to sustain itself. Without any government
protection whatever, it goes abroad to challenge competition with the
whole world; and, in spite of all obstacles, it has yet been able to
maintain eight hundred thousand tons in the employment of foreign trade.
How, Sir, do the ship-owners and navigators accomplish this? How is it
that they are able to meet, and in some measure overcome, universal
competition? It is not, Sir, by protection and bounties: but by
unwearied exertion, by extreme economy, by unshaken perseverance, by
that manly and resolute spirit which relies on itself to protect itself.
These causes alone enable American ships still to keep their element,
and show the flag of their country in distant seas. The rates of
insurance may teach us how thoroughly our ships are built, and how
skilfully and safely they are navigated. Risks are taken, as I learn,
from the United States to Liverpool, at one per cent; and from the
United States to Canton and back, as low as three per cent. But when we
look to the low rate of freight, and when we consider, also, that the
articles entering into the composition of a ship, with the exception of
wood, are dearer here than in other countries, we cannot but be utterly
surprised that the shipping interest has been able to sustain itself at
all. I need not say that the navigation of the country is essential to
its honor and its defence. Yet, instead of proposing benefits for it in
this hour of its depression, we threaten by this measure to lay upon it
new and heavy burdens. In the discussion, the other day, of that
provision of the bill which proposes to tax tallow for the benefit of
the oil-merchants and whalemen, we had the pleasure of hearing eloquent
eulogiums upon that portion of our shipping employed in the
whale-fishery, and strong statements of its importance to the public
interest. But the same bill proposes a severe tax upon that interest,
for the benefit of the iron-manufacturer and the hemp-grower. So that
the tallow-chandlers and soapboilers are sacrificed to the
oil-merchants, in order that these again may contribute to the
manufacturers of iron and the growers of hemp.
If such be the state of our commerce and navigation, what is the
condition of our home manufactures? How are they amidst the general
depression? Do they need further protection? and if any, how much? On
all these points, we have had much general statement, but little
precise information. In the very elaborate speech of Mr. Speaker, we are
not supplied with satisfactory grounds of judging with respect to these
various particulars. Who can tell, from any thing yet before the
committee, whether the proposed duty be too high or too low on any one
article? Gentlemen tell us, that they are in favor of domestic industry;
so am I. They would give it protection; so would I. But then all
domestic industry is not confined to manufactures. The employments of
agriculture, commerce, and navigation are all branches of the same
domestic industry; they all furnish employment for American capital and
American labor. And when the question is, whether new duties shall be
laid, for the purpose of giving further encouragement to particular
manufactures, every reasonable man must ask himself, both whether the
proposed new encouragement be necessary, and whether it can be given
without injustice to other branches of industry.
It is desirable to know, also, somewhat more distinctly, how the
proposed means will produce the intended effect. One great object
proposed, for example, is the increase of the home market for the
consumption of agricultural products. This certainly is much to be
desired; but what provisions of the bill are expected wholly or
principally to produce this, is not stated. I would not deny that some
increase of the home market may follow, from the adoption of this bill,
but all its provisions have not an equal tendency to produce this
effect. Those manufactures which employ most labor, create, of course,
most demand for articles of consumption; and those create least in the
production of which capital and skill enter as the chief ingredients of
cost. I cannot, Sir, take this bill merely because a committee has
recommended it. I cannot espouse a side, and fight under a flag. I
wholly repel the idea that we must take this law, or pass no law on the
subject. What should hinder us from exercising our own judgments upon
these provisions, singly and severally? Who has the power to place us,
or why should we place ourselves, in a condition where we cannot give to
every measure, that is distinct and separate in itself, a separate and
distinct consideration? Sir, I presume no member of the committee will
withhold his assent from what he thinks right, until others will yield
their assent to what they think wrong. There are many things in this
bill acceptable, probably, to the general sense of the House. Why should
not these provisions be passed into a law, and others left to be decided
upon their own merits, as a majority of the House shall see fit? To some
of these provisions I am myself decidedly favorable; to others I have
great objections; and I should have been very glad of an opportunity of
giving my own vote distinctly on propositions which are, in their own
nature, essentially and substantially distinct from one another.
But, Sir, before expressing my own opinion upon the several provisions
of this bill, I will advert for a moment to some other general topics.
We have heard much of the policy of England, and her example has been
repeatedly urged upon us, as proving, not only the expediency of
encouragement and protection, but of exclusion and direct prohibition
also. I took occasion the other day to remark, that more liberal notions
were becoming prevalent on this subject; that the policy of restraints
and prohibitions was getting out of repute, as the true nature of
commerce became better understood; and that, among public men, those
most distinguished were most decided in their reprobation of the broad
principle of exclusion and prohibition. Upon the truth of this
representation, as matter of fact, I supposed there could not be two
opinions among those who had observed the progress of political
sentiment in other countries, and were acquainted with its present
state. In this respect, however, it would seem that I was greatly
mistaken. We have heard it again and again declared, that the English
government still adheres, with immovable firmness, to its old doctrines
of prohibition; that although journalists, theorists, and scientific
writers advance other doctrines, yet the practical men, the legislators,
the government of the country, are too wise to follow them. It has even
been most sagaciously hinted, that the promulgation of liberal opinions
on these subjects is intended only to delude other governments, to
cajole them into the folly of liberal ideas, while England retains to
herself all the benefits of the admirable old system of prohibition. We
have heard from Mr. Speaker a warm commendation of the complex mechanism
of this system. The British empire, it is said, is, in the first place,
to be protected against the rest of the world; then the British Isles
against the colonies; next, the isles respectively against each other,
England herself, as the heart of the empire, being protected most of
all, and against all.
Truly, Sir, it appears to me that Mr. Speaker's imagination has seen
system, and order, and beauty, in that which is much more justly
considered as the result of ignorance, partiality, or violence. This
part of English legislation has resulted, partly from considering
Ireland as a conquered country, partly from the want of a complete
union, even with Scotland, and partly from the narrow views of colonial
regulation, which in early and uninformed periods influenced the
European states.
Nothing, I imagine, would strike the public men of England more
singularly, than to find gentlemen of real information and much weight
in the councils of this country expressing sentiments like these, in
regard to the existing state of these English laws. I have never said,
indeed, that prohibitory laws do not exist in England; we all know they
do; but the question is, Does she owe her prosperity and greatness to
these laws? I venture to say, that such is not the opinion of public men
now in England, and the continuance of the laws, even without any
alteration, would not be evidence that their opinion is different from
what I have represented it; because the laws having existed long, and
great interests having been built up on the faith of them, they cannot
now be repealed without great and overwhelming inconvenience. Because a
thing has been wrongly done, it does not therefore follow that it can
now be undone; and this is the reason, as I understand it, for which
exclusion, prohibition, and monopoly are suffered to remain in any
degree in the English system; and for the same reason, it will be wise
in us to take our measures, on all subjects of this kind, with great
caution. We may not be able, but at the hazard of much injury to
individuals, hereafter to retrace our steps. And yet, whatever is
extravagant or unreasonable is not likely to endure. There may come a
moment of strong reaction; and if no moderation be shown in laying on
duties, there may be as little scruple in taking them off.
It may be here observed, that there is a broad and marked distinction
between entire prohibition and reasonable encouragement. It is one
thing, by duties or taxes on foreign articles, to awaken a home
competition in the production of the same articles; it is another thing
to remove all competition by a total exclusion of the foreign article;
and it is quite another thing still, by total prohibition, to raise up
at home manufactures not suited to the climate, the nature of the
country, or the state of the population. These are substantial
distinctions, and although it may not be easy in every case to determine
which of them applies to a given article, yet the distinctions
themselves exist, and in most cases will be sufficiently clear to
indicate the true course of policy; and, unless I have greatly mistaken
the prevailing sentiment in the councils of England, it grows every day
more and more favorable to the diminution of restrictions, and to the
wisdom of leaving much (I do not say every thing, for that would not be
true) to the enterprise and the discretion of individuals. I should
certainly not have taken up the time of the committee to state at any
length the opinions of other governments, or of the public men of other
countries, upon a subject like this; but an occasional remark made by me
the other day, having been so directly controverted, especially by Mr.
Speaker, in his observations yesterday, I must take occasion to refer to
some proofs of what I have stated.
What, then, is the state of English opinion? Everybody knows that, after
the termination of the late European war, there came a time of great
pressure in England. Since her example has been quoted, let it be asked
in what mode her government sought relief. Did it aim to maintain
artificial and unnatural prices? Did it maintain a swollen and
extravagant paper circulation? Did it carry further the laws of
prohibition and exclusion? Did it draw closer the cords of colonial
restraint? No, Sir, but precisely the reverse. Instead of relying on
legislative contrivances and artificial devices, it trusted to the
enterprise and industry of the people, which it sedulously sought to
excite, not by imposing restraint, but by removing it, wherever its
removal was practicable. In May, 1820, the attention of the government
having been much turned to the state of foreign trade, a distinguished
member[2] of the House of Peers brought forward a Parliamentary motion
upon that subject, followed by an ample discussion and a full statement
of his own opinions. In the course of his remarks, he observed, "that
there ought to be no prohibitory duties as such; for that it was
evident, that, where a manufacture could not be carried on, or a
production raised, but under the protection of a prohibitory duty, that
manufacture, or that produce, could not be brought to market but at a
loss. In his opinion, the name of strict prohibition might, therefore,
in commerce, be got rid of altogether; but he did not see the same
objection to protecting duties, which, while they admitted of the
introduction of commodities from abroad similar to those which we
ourselves manufactured, placed them so much on a level as to allow a
competition between them." "No axiom," he added, "was more true than
this: that it was by growing what the territory of a country could grow
most cheaply, and by receiving from other countries what it could not
produce except at too great an expense, that the greatest degree of
happiness was to be communicated to the greatest extent of population."
In assenting to the motion, the first minister[3] of the crown expressed
his own opinion of the great advantage resulting from unrestricted
freedom of trade. "Of the soundness of that general principle," he
observed, "I can entertain no doubt. I can entertain no doubt of what
would have been the great advantages to the civilized world, if the
system of unrestricted trade had been acted upon by every nation from
the earliest period of its commercial intercourse with its neighbors. If
to those advantages there could have been any exceptions, I am persuaded
that they would have been but few; and I am also persuaded that the
cases to which they would have referred would not have been, in
themselves, connected with the trade and commerce of England. But we are
now in a situation in which, I will not say that a reference to the
principle of unrestricted trade can be of no use, because such a
reference may correct erroneous reasoning, but in which it is impossible
for us, or for any country in the world but the United States of
America, to act unreservedly on that principle. The commercial
regulations of the European world have been long established, and cannot
suddenly be departed from." Having supposed a proposition to be made to
England by a foreign state for free commerce and intercourse, and an
unrestricted exchange of agricultural products and of manufactures, he
proceeds to observe: "It would be impossible to accede to such a
proposition. We have risen to our present greatness under a different
system. Some suppose that we have risen in consequence of that system;
_others, of whom I am one, believe that we have risen in spite of that
system_. But, whichever of these hypotheses be true, certain it is that
we have risen under a very different system than that of free and
unrestricted trade. It is utterly impossible, with our debt and
taxation, even if they were but half their existing amount, that we can
suddenly adopt the system of free trade."
Lord Ellenborough, in the same debate, said, "that he attributed the
general distress then existing in Europe to the regulations that had
taken place since the destruction of the French power. Most of the
states on the Continent had surrounded themselves as with walls of
brass, to inhibit intercourse with other states. Intercourse was
prohibited, even in districts of the same state, as was the case in
Austria and Sardinia. Thus, though the taxes on the people had been
lightened, the severity of their condition had been increased. He
believed that the discontent which pervaded most parts of Europe, and
especially Germany, was more owing to commercial restrictions than to
any theoretical doctrines on government; and that a free communication
among them would do more to restore tranquillity, than any other step
that could be adopted. He objected to all attempts to frustrate the
benevolent intentions of Providence, which had given to various
countries various wants, in order to bring them together. He objected to
it as anti-social; he objected to it as making commerce the means of
barbarizing instead of enlightening nations. The state of the trade with
France was most disgraceful to both countries; the two greatest
civilized nations of the world, placed at a distance of scarcely twenty
miles from each other, had contrived, by their artificial regulations,
to reduce their commerce with each other to a mere nullity." Every
member speaking on this occasion agreed in the general sentiments
favorable to unrestricted intercourse, which had thus been advanced; one
of them remarking, at the conclusion of the debate, that "the principles
of free trade, which he was happy to see so fully recognized, were of
the utmost consequence; for, though, in the present circumstances of the
country, a free trade was unattainable, yet their task hereafter was to
approximate to it. Considering the prejudices and interests which were
opposed to the recognition of that principle, it was no small indication
of the firmness and liberality of government to have so fully conceded
it."
Sir, we have seen, in the course of this discussion, that several
gentlemen have expressed their high admiration of the _silk manufacture_
of England. Its commendation was begun, I think, by the honorable member
from Vermont, who sits near me, who thinks that that alone gives
conclusive evidence of the benefits produced by attention to
manufactures, inasmuch as it is a great source of wealth to the nation,
and has amply repaid all the cost of its protection. Mr. Speaker's
approbation of this part of the English example was still warmer. Now,
Sir, it does so happen, that both these gentlemen differ very widely on
this point from the opinions entertained in England, by persons of the
first rank, both as to knowledge and power. In the debate to which I
have already referred, the proposer of the motion urged the expediency
of providing for the admission of the silks of France into England. "He
was aware," he said, "that there was a poor and industrious body of
manufacturers, whose interests must suffer by such an arrangement; and
therefore he felt that it would be the duty of Parliament to provide for
the present generation by a large Parliamentary grant. It was
conformable to every principle of sound justice to do so, when the
interests of a particular class were sacrificed to the good of the
whole." In answer to these observations, Lord Liverpool said that, with
reference to several branches of manufactures, time, and the change of
circumstances, had rendered the system of protecting duties merely
nominal; and that, in his opinion, if all the protecting laws which
regarded both the woollen and cotton manufactures were to be repealed,
no injurious effects would thereby be occasioned. "But," he observes,
"with respect to silk, that manufacture in this kingdom is so completely
artificial, that any attempt to introduce the principles of free trade
with reference to it might put an end to it altogether. I allow that the
silk manufacture is not natural to this country. _I wish we had never
had a silk manufactory._ I allow that it is natural to France; I allow
that it might have been better, had each country adhered exclusively to
that manufacture in which each is superior; and had the silks of France
been exchanged for British cottons. But I must look at things as they
are; and when I consider the extent of capital, and the immense
population, consisting, I believe, of about fifty thousand persons,
engaged in our silk manufacture, I can only say, that one of the few
points in which I totally disagree with the proposer of the motion is
the expediency, under existing circumstances, of holding out any idea
that it would be possible to relinquish the silk manufacture, and to
provide for those who live by it, by Parliamentary enactment. Whatever
objections there may be to the continuance of the protecting system, I
repeat, that it is impossible altogether to relinquish it. I may regret
that the system was ever commenced; but as I cannot recall that act, I
must submit to the inconvenience by which it is attended, rather than
expose the country to evils of greater magnitude." Let it be remembered,
Sir, that these are not the sentiments of a theorist, nor the fancies of
speculation; but the operative opinions of the first minister of
England, acknowledged to be one of the ablest and most practical
statesmen of his country.
Gentlemen could have hardly been more unfortunate than in the selection
of the silk manufacture in England as an example of the beneficial
effects of that system which they would recommend. It is, in the
language which I have quoted, completely artificial. It has been
sustained by I know not how many laws, breaking in upon the plainest
principles of general expediency. At the last session of Parliament, the
manufacturers petitioned for the repeal of three or four of these
statutes, complaining of the vexatious restrictions which they impose on
the wages of labor; setting forth, that a great variety of orders has
from time to time been issued by magistrates under the authority of
these laws, interfering in an oppressive manner with the minutest
details of the manufacture,--such as limiting the number of threads to
an inch, restricting the widths of many sorts of work, and determining
the quantity of labor not to be exceeded without extra wages; that by
the operation of these laws, the rate of wages, instead of being left to
the recognized principles of regulation, has been arbitrarily fixed by
persons whose ignorance renders them incompetent to a just decision;
that masters are compelled by law to pay an equal price for all work,
whether well or ill performed; and that they are wholly prevented from
using improved machinery, it being ordered, that work, in the weaving of
which machinery is employed, shall be paid precisely at the same rate as
if done by hand; that these acts have frequently given rise to the most
vexatious regulations, the unintentional breach of which has subjected
manufacturers to ruinous penalties; and that the introduction of all
machinery being prevented, by which labor might be cheapened, and the
manufacturers being compelled to pay at a fixed price, under all
circumstances, they are unable to afford employment to their workmen, in
times of stagnation of trade, and are compelled to stop their looms. And
finally, they complain that, notwithstanding these grievances under
which they labor, while carrying on their manufacture in London, the law
still prohibits them, while they continue to reside there, from
employing any portion of their capital in the same business in any other
part of the kingdom, where it might be more beneficially conducted.
Now, Sir, absurd as these laws must appear to be to every man, the
attempt to repeal them did not, as far as I recollect, altogether
succeed. The weavers were too numerous, their interests too great, or
their prejudices too strong; and this notable instance of protection and
monopoly still exists, to be lamented in England with as much sincerity
as it seems to be admired here.
In order further to show the prevailing sentiment of the English
government, I would refer to a report of a select committee of the House
of Commons, at the head of which was the Vice-President of the Board of
Trade (Mr. Wallace), in July, 1820. "The time," say that committee,
"when monopolies could be successfully supported, or would be patiently
endured, either in respect to subjects against subjects, or particular
countries against the rest of the world, seems to have passed away.
Commerce, to continue undisturbed and secure, must be, as it was
intended to be, a source of reciprocal amity between nations, and an
interchange of productions to promote the industry, the wealth, and the
happiness of mankind." In moving for the re-appointment of the committee
in February, 1823, the same gentleman said: "We must also get rid of
that feeling of appropriation which exhibited itself in a disposition to
produce every thing necessary for our own consumption, and to render
ourselves independent of the world. No notion could be more absurd or
mischievous; it led, even in peace, to an animosity and rancor greater
than existed in time of war. Undoubtedly there would be great prejudices
to combat, both in this country and elsewhere, in the attempt to remove
the difficulties which are most obnoxious. It would be impossible to
forget the attention which was in some respects due to the present
system of protections, although that attention ought certainly not to be
carried beyond the absolute necessity of the case." And in a second
report of the committee, drawn by the same gentleman, in that part of it
which proposes a diminution of duties on timber from the North of
Europe, and the policy of giving a legislative preference to the
importation of such timber in the log, and a discouragement of the
importation of deals, it is stated that the committee reject this
policy, because, among other reasons, "it is founded on a principle of
exclusion, which they are most averse to see brought into operation, in
any _new instance_, without the warrant of some evident and great
political expediency." And on many subsequent occasions the same
gentleman has taken occasion to observe, that he differed from those who
thought that manufactures could not nourish without restrictions on
trade; that old prejudices of that sort were dying away, and that more
liberal and just sentiments were taking their place.
These sentiments appear to have been followed by important legal
provisions, calculated to remove restrictions and prohibitions where
they were most severely felt; that is to say, in several branches of
navigation and trade. They have relaxed their colonial system, they have
opened the ports of their islands, and have done away the restriction
which limited the trade of the colony to the mother country. Colonial
products can now be carried directly from the islands to any part of
Europe; and it may not be improbable, considering our own high duties on
spirits, that that article may be exchanged hereafter by the English
West India colonies directly for the timber and deals of the Baltic. It
may be added, that Mr. Lowe, whom the gentleman has cited, says, that
nobody supposes that the three great staples of English manufactures,
cotton, woollen, and hardware, are benefited by any existing protecting
duties; and that one object of all these protecting laws is usually
overlooked, and that is, that they have been intended to reconcile the
various interests to taxation; the corn law, for example, being designed
as some equivalent to the agricultural interest for the burden of tithes
and of poor-rates.
In fine, Sir, I think it is clear, that, if we now embrace the system of
prohibitions and restrictions, we shall show an affection for what
others have discarded, and be attempting to ornament ourselves with
cast-off apparel.
Sir, I should not have gone into this prolix detail of opinions from any
consideration of their special importance on the present occasion; but
having happened to state that such was the actual opinion of the
government of England at the present time, and the accuracy of this
representation having been so confidently denied, I have chosen to put
the matter beyond doubt or cavil, although at the expense of these
tedious citations. I shall have occasion hereafter to refer more
particularly to sundry recent British enactments, by way of showing the
diligence and spirit with which that government strives to sustain its
navigating interest, by opening the widest possible range to the
enterprise of individual adventurers. I repeat, that I have not alluded
to these examples of a foreign state as being fit to control our own
policy. In the general principle, I acquiesce. Protection, when carried
to the point which is now recommended, that is, to entire prohibition,
seems to me destructive of all commercial intercourse between nations.
We are urged to adopt the system upon general principles; and what would
be the consequence of the universal application of such a general
principle, but that nations would abstain entirely from all intercourse
with one another? I do not admit the general principle; on the contrary,
I think freedom of trade to be the general principle, and restriction
the exception. And it is for every state, taking into view its own
condition, to judge of the propriety, in any case, of making an
exception, constantly preferring, as I think all wise governments will,
not to depart without urgent reason from the general rule.
There is another point in the existing policy of England to which I
would most earnestly invite the attention of the committee; I mean the
warehouse system, or what we usually call the system of drawback. Very
great prejudices appear to me to exist with us on that subject. We seem
averse to the extension of the principle. The English government, on the
contrary, appear to have carried it to the extreme of liberality. They
have arrived, however, at their present opinions and present practice by
slow degrees. The transit system was commenced about the year 1803, but
the first law was partial and limited. It admitted the importation of
raw materials for exportation, but it excluded almost every sort of
manufactured goods. This was done for the same reason that we propose to
prevent the transit of Canadian wheat through the United States, the
fear of aiding the competition of the foreign article with our own in
foreign markets. Better reflection or more experience has induced them
to abandon that mode of reasoning, and to consider all such means of
influencing foreign markets as nugatory; since, in the present active
and enlightened state of the world, nations will supply themselves from
the best sources, and the true policy of all producers, whether of raw
materials or of manufactured articles, is, not vainly to endeavor to
keep other vendors out of the market, but to conquer them in it by the
quality and the cheapness of their articles. The present policy of
England, therefore, is to allure the importation of commodities into
England, there to be deposited in English warehouses, thence to be
exported in assorted cargoes, and thus enabling her to carry on a
general export trade to all quarters of the globe. Articles of all
kinds, with the single exception of tea, may be brought into England,
from any part of the world, in foreign as well as British ships, there
warehoused, and again exported, at the pleasure of the owner, without
the payment of any duty or government charge whatever.
While I am upon this subject, I would take notice also of the recent
proposition in the English Parliament to abolish the tax on imported
wool; and it is observable that those who support this proposition give
the same reasons that have been offered here, within the last week,
against the duty which we propose on the same article. They say that
their manufacturers require a cheap and coarse wool, for the supply of
the Mediterranean and Levant trade, and that, without a more free
admission of the wool of the Continent, that trade will all fall into
the hands of the Germans and Italians, who will carry it on through
Leghorn and Trieste. While there is this duty on foreign wool to protect
the wool-growers of England, there is, on the other hand, a prohibition
on the exportation of the native article in aid of the manufacturers.
The opinion seems to be gaining strength, that the true policy is to
abolish both.
Laws have long existed in England preventing the emigration of artisans
and the exportation of machinery; but the policy of these, also, has
become doubted, and an inquiry has been instituted in Parliament into
the expediency of repealing them. As to the emigration of artisans, say
those who disapprove the laws, if that were desirable, no law could
effect it; and as to the exportation of machinery, let us make it and
export it as we would any other commodity. If France is determined to
spin and weave her own cotton, let us, if we may, still have the benefit
of furnishing the machinery.
I have stated these things, Sir, to show what seems to be the general
tone of thinking and reasoning on these subjects in that country, the
example of which has been so much pressed upon us. Whether the present
policy of England be right or wrong, wise or unwise, it cannot, as it
seems clearly to me, be quoted as an authority for carrying further the
restrictive and exclusive system, either in regard to manufactures or
trade. To re-establish a sound currency, to meet at once the shock,
tremendous as it was, of the fall of prices, to enlarge her capacity for
foreign trade, to open wide the field of individual enterprise and
competition, and to say plainly and distinctly that the country must
relieve itself from the embarrassments which it felt, by economy,
frugality, and renewed efforts of enterprise,--these appear to be the
general outline of the policy which England has pursued.
Mr. Chairman, I will now proceed to say a few words upon a topic, but
for the introduction of which into this debate I should not have given
the committee on this occasion the trouble of hearing me. Some days ago,
I believe it was when we were settling the controversy between the
oil-merchants and the tallow-chandlers, the _balance of trade_ made its
appearance in debate, and I must confess, Sir, that I spoke of it, or
rather spoke to it, somewhat freely and irreverently. I believe I used
the hard names which have been imputed to me, and I did it simply for
the purpose of laying the spectre, and driving it back to its tomb.
Certainly, Sir, when I called the old notion on this subject nonsense, I
did not suppose that I should offend any one, unless the dead should
happen to hear me. All the living generation, I took it for granted,
would think the term very properly applied. In this, however, I was
mistaken. The dead and the living rise up together to call me to
account, and I must defend myself as well as I am able.
Let us inquire, then, Sir, what is meant by an unfavorable balance of
trade, and what the argument is, drawn from that source. By an
unfavorable balance of trade, I understand, is meant that state of
things in which importation exceeds exportation. To apply it to our own
case, if the value of goods imported exceed the value of those exported,
then the balance of trade is said to be against us, inasmuch as we have
run in debt to the amount of this difference. Therefore it is said,
that, if a nation continue long in a commerce like this, it must be
rendered absolutely bankrupt. It is in the condition of a man that buys
more than he sells; and how can such a traffic be maintained without
ruin? Now, Sir, the whole fallacy of this argument consists in
supposing, that, whenever the value of imports exceeds that of exports,
a debt is necessarily created to the extent of the difference, whereas,
ordinarily, the import is no more than the result of the export,
augmented in value by the labor of transportation. The excess of imports
over exports, in truth, usually shows the gains, not the losses, of
trade; or, in a country that not only buys and sells goods, but employs
ships in carrying goods also, it shows the profits of commerce, and the
earnings of navigation. Nothing is more certain than that, in the usual
course of things, and taking a series of years together, the value of
our imports is the aggregate of our exports and our freights. If the
value of commodities imported in a given instance did not exceed the
value of the outward cargo, with which they were purchased, then it
would be clear to every man's common sense, that the voyage had not been
profitable. If such commodities fell far short in value of the cost of
the outward cargo, then the voyage would be a very losing one; and yet
it would present exactly that state of things, which, according to the
notion of a balance of trade, can alone indicate a prosperous commerce.
On the other hand, if the return cargo were found to be worth much more
than the outward cargo, while the merchant, having paid for the goods
exported, and all the expenses of the voyage, finds a handsome sum yet
in his hands, which he calls profits, the balance of trade is still
against him, and, whatever he may think of it, he is in a very bad way.
Although one individual or all individuals gain, the nation loses; while
all its citizens grow rich, the country grows poor. This is the doctrine
of the balance of trade.