CH. IX. PROTECTION' IN THE UNITED STATES. 339 35 per cent.; on clocks and watches, 25 to 35 per cent.; on hats, from 30 to 60 per cent. ; on prepared woods and furniture, 30 to 35 per cent. ; on lucifer matches, 35 per cent.; on pianos, 30 per cent. ; on pictures, 10 per cent.; on toys, 50 per cent.; on umbrellas and parasols, 45 to 60 per cent.; on gloves, 35 to 50 per cent.; on earthenware and porcelain goods, 20 to 50 per cent. ; on glasswares, 35 to 40 per cent.; and finally, ships and boats are altogether prohibited.1 Such is an illustration of the kind of rates of taxation which the United States impose upon some of those articles in the production of which they are placed at a serious disadvantage when compared with other countries. Capital and labour must be abstracted from the employments in which the country does possess an advantage over others to produce these articles, which can be produced so much more economically elsewhere. A very able and intelligent writer 2 on British Trade' in Fraser's Magazine,' thus writes upon this subject:'The policy of the country (the United States) is to develop, first of all, her crude resources, so to say, to make the land, which is the cheapest commodity it possesses, and the most easily worked, yield its utmost. The United States could distance almost all the world in providing endless varieties of raw produce and food grains, if the people were so inclined; and that they have continued producing as they have done, in the face of a prohibitory customs tariff, is proof of this. But I do not think if the tariff continues in force on its present footing that this predominance can go on. Nay, I do not think it 1 See Return of the Rates of Import Duty levied in European Countries and the United States upon the Produce and Manufactures of the United Kingdom, October, 1876. 2 Mr. Alexander Johnstone Wilson. The article referred to is one of several which have since been republished under the title, The Resources of Modern Countries. could have lasted so markedly up to now, had other countries not been in their several ways tied up against more effectual competition, and any material lowering of the price of corn in Europe would produce serious results in the States, even under present conditions. Throughout the whole of it (the tariff) the idea runs of making anything manufactured pay severely; and to such an outrageous and unreasoning extent has the theory been carried, that, after a rather minute study of the tariff, I should say that I am within the mark in estimating that there must be about 1,000 articles at least on which the duty cannot, on the average, pay for collection and trouble. . . The hindrances to trade with the United States are artificial altogether, and not natural. Left to itself, the reciprocal business between England and the American Union would grow beyond anything that it has ever reached. The two countries could be the means of giving innumerable benefits to each other-we with our old deep-rooted manufacturing capabilities, and the New World with its boundless resources for the furnishing of raw materials.' Now the diversion of the labour of the States population does not proceed from, or cannot be excused by, any inability of the people to pursue agricultural avocations; for it is unfortunately true that the great proportion of the agricultural emigrants from other countries settle down in the towns, chiefly in the eastern States of the Union, and to speak particularly, almost one-half of the Irish, and more than one-third of the German emigrants, who are chiefly agriculturalists, settle down in the fifty chief towns of the Union. The knowledge which these emigrants possess of rural affairs is, therefore, when their energies are expended in industrial employments, lost. The permanent or lasting result of this system of protection has been that the railways which have been constructed to develop the country have been constructed at CH. IX. PROTECTION IN AMERICA. 341 a needless cost, and all other permanent works likewise. But so long as foreign capital flowed into the States freely this evil was not regarded. When, however, this capital began to be withheld, a crisis came, which has not yet, after four years' duration, passed away. From 1866 to 1875 inclusive, railways of the aggregate length of 37,000 miles were constructed, which drew their supplies of capital largely from the resources of Great Britain and the Continent. This expenditure maintained a factitious condition of things while it went on, and native as well as foreign manufacturing industries appeared to flourish and increase rapidly. The collapse came in the end of 1873, and, capital since that time being mainly withheld, bad trade had supervened, without much hope of immediate improvement. No departments of industry in the United States can be said now to exist satisfactorily and securely, except those for which the country possesses permanent advantages those indeed which natural conditions especially favour. These departments are more particularly those connected with the cultivation of the land, and the more easily acquired mineral resources, such as gold and silver, and perhaps iron and coal, upon which a minimum of labour is required. These, however, are now more heavily weighted than they ought to be, and do not possess such superlative advantages as they might have possessed, had not artificial restriction caused an increase in the price of nearly every article required in connection with their working. Thus, the cultivator of cotton now must pay more for its carriage to market than he should have done, on account of the iron of which the railways and their plant are constructed having been made unnecessarily dear; and he must also pay even now, while the prohibitory tariff exists, an inordinately high price for the implements with which he works, and for the clothes which cover him. The same remarks are equally applicable to the cultivation and production of the land generally. A tax must be paid by the farmer now which is not felt to be grievous, because it is an indirect one; but even though the present tariff were to be immediately abolished-a thing that could not be done without causing great suffering to multitudes he would still be taxed on account of the heavy and disproportionate, expenditure laid out on these public works that are indispensable to him. But the Union must pay, in gold or in commodities of one kind or other, interest upon her debts to the foreign creditor; and in proportion as her debt is great so will the exports necessarily exceed the imports; and, when difficulties are raised against the importation of foreign goods, the total sum of imports and exports together will be reduced, till the relation between the exports and imports will become very disproportionate. But so little is the true significance of this disproportion understood, that we find distinguished American statesmen, and even the President himself, congratulating the country on the fact of what is called the 'balance of trade' being in its favour. No delusion can be more complete, and none can well produce more serious consequences to the well-being of a whole nation. The case of Great Britain is exactly the reverse of that of the States; her imports greatly exceed her exports, and, as trade declines, that disproportion must become more striking. Yet, though the balance of trade' is so much against this country, there exists a tolerable degree of comfort and prosperity amongst the population, which strikingly contrasts with the opposite condition that exists in the States. What are the facts with reference to these exports and imports? The exports of the United States of America to Great Britain increased from 54,663,000l. in 1872 to 75,899,000l. in 1876, while the imports diminished in the CH. IX. UNITED STATES IMPORTS AND EXPORTS. 343 same years from 45,907,000l. to 20,226,000l. If we compare these figures with those of the exports and imports of Great Britain to and from all countries, we shall find a marked contrast. These exports in 1872 amounted to the value of 256,000,000l., and in 1876 to 201,000,000l., whereas the imports in the same two years were respectively 354,000,000l. and 375,000,000l. Thus, while the exports from the States increased in these four years at the rate of about 40 per cent., those of Great Britain decreased at half that rate; and while the imports of the States decreased about 60 per cent., those of Great Britain increased about 6 per cent. If we regard the total exports and imports of the States, we shall find that the latter are three-fourths lower, and the former unchanged. It is, therefore, perfectly apparent that while Great Britain is able to draw continuously from foreign countries a larger and larger value of imports in payment of the interest of her capital invested-for it increases while the value of the exports greatly diminishes—it is equally apparent that the States must, notwithstanding the uniformity of her exports, curtail greatly the value of her imports, the balance generally representing roughly what she owes to the capitalists of Europe. And, notwithstanding all the boundless and easily acquired natural resources of America, the policy of the government has been successful in restricting the foreign business of a country, twenty-five times larger than Great Britain, to less than one-half its amount. The theory of the balance of trade' might then, with immense advantage to everyone, have long since been forgotten; and so long as it is regarded as a criterion upon which to judge of the progress of a nation, so long will it perniciously restrict trade and sever the interests of populations that are fitted mutually to confer the most valuable benefits. An excess of imports, then, is not a |