FREE TRADE AND DEMOCRACY.
[FROM OUR SPECIAL CORRESPONDENT.]
New York, October 19, 1866.
SOME time ago the Spectator said, "The democracies seem to be all going wrong upon the question of Free Trade." As far at least as this democracy is concerned the Spectator was correct from its point of view—that Free Trade is right and Protection wrong. Upon the same subject, at about the same time, the Saturday Review said, "The profound ignorance of political economy which prevails in the United States explains the subservience of the Legislature to private interests." In this I venture to say that the Saturday Review was no nearer the truth than it was in its repeated announcement that whatever should be the end of our civil war, the end of the Federal war debt would be repudiation. Whether the policy of the United States in regard to Free Trade be right or wrong, it has been adopted not only with open eyes by a people which is generally admitted to be mode- rately capable of looking after its own interests, but after a very thorough and exhaustive discussion of the subject by men who have made political economy a study, and also by politicians and journalists before the great mass of the people. So far is it untrue that a profound ignorance of political economy prevails in this country, that the assertion might be safely made that in no other country is there so generally diffused an acquaintance with the arguments which have been brought forward on both sides of this question of Free Trade at least, from the time of Adam Smith to that of Bastiat. It would be difficult to find, I believe, the argument for Free Trade presented more comprehensively, more compactly, and with greater force, than in Mr. Arthur Latham Perry's Elements of Political Economy, he being Professor of Political Economy in Williams' College, Massa- chusetts. The battle on this question has been going on here fiercely for more than a generation between the majority and a large and very able minority ; and it appears to us that for a nation which has so very recently taken its place unequivocally upon the side of Free Trade as Great Britain to assign ignorance upon the subject as the reason of our adherence to the Protective system is, to say the least, somewhat amusing. There is a Free Trade League here, the primary object of which is to disseminate information on the principles of political economy, with special reference to their practical application to Free Trade. The President of this League is Mr. Bryant, one of our ablest and most trusted publicists ; and its first Vice-President is Mr. David Dudley Field, who has performed with such credit the chief part of the labour in the codification of the laws of the State of New York, and who now represents us in the Social Science Congress.
Free Trade, however, has never been regarded with favour by the people who really rule this country, and who now rule it more than ever, the freeholders of the late Free States and of the northern tier of the late Slave States. The question is regarded somewhat thus. The mass of the intelligent people see, of course, that most of the premisses from which the Free Traders argue are sound. At least I never knew them to be seriously disputed here, except in the Tribune, which is as rabid upon the question of Protection as it is upon many others, That every
man has a natural right to sell the product of his labour in the best market and to spend the proceeds as he pleases,— that a free exchange of the products of labour is one of the first desiderata in political economy, —that all taxation, whether direct or indirect, for the benefit of special classes is unjust,—that the more a nation imports the greater will be the encouragement of home industry, because of the employment furnished to those who must produce the commodities exported in exchange for those which are imported,—that a people will be most enriched in money and goods by engaging in those occupations for which it has advantages over other peoples,—that exchanges of commodities thus produced are beneficial to both parties, —and that, therefore, although there is a balance of trade in the sense of a difference of value in goods exchanged which may have to be settled by the payment of money, there is no such advantageous balance of trade as was sought for under the old so-called mercantile system,—and that Free trade is natural, simple, and in a certain sense cheap, and Protection artificial, complicated, and in a certain sense dear —these propositions, and all the corollaries dependent upon them, I suppose that few intelligent people here will deny. But is not, I think you will ask, to admit all this to admit implicitly that Free Trade is the correct economical system, especially in a democratic country, where the denial of privilege and the freedom of the individual are at the foundation of the political system ? Not at all, say the Protectionists, the advocates. of what thirty years ago was called the American system ; and for these reasons. The question of natural right is not paramount ; we are not living in a state of nature. Free exchange is a great desideratum, but not the greatest. Taxation for the benefit of special classes is unjust ; but Protection taxes only for the benefit of the whole ; and whatever benefit special classes derive from it on the one hand, or lose by it on the other, is but incidental. Large imports make large demands upon home industry for pay- ment, and peoples will acquire the greatest material wealth by confining themselves to occupations for which they have peculiar advantages ; but neither the mere industrious employment of time, nor the acquirement of material wealth, is the fast aim of our- system of political economy. The Chinese are industrious, so are British farm labourers, colliers, and cutlers ; and China gets all the silver in the world, while Great Britain in- creases her enormous wealth year by year. We seek some- thing more than such industry and such wealth. Free trade is simple ; so is despotism. No system so simple as "Do this, and' he doeth it," but we prefer constitutional government, though it be complicated. Free Trade is cheap in a certain sense ; so des- potism might be ; excessive expenditure is not essential to its- perfect working, while the constitutional government that we prefer necessarily involves large expenses, and opens the door to. great corruption. They would not of course compare Free Trade with despotism, but merely set off the simplicity and cheapness of the one against the simplicity and cheapness of the other. To. the odd point so strongly urged by the Free Traders, that to make a man, in consequence of a mere statute, pay a dollar and a. half for that which he could otherwise get for one dollar, when. the excess goes but in part into the common treasury, is tyranny, robbery ; they reply that Government, whether local or national, is- continually interfering, tyrannizing, robbing in that manner; that there can be no more manifest right than that of a man, to drive his own horse and cart, his own coach, and carry what and whom he pleases, or to carry the letters of his friends and acquaintances about and deliver them ; but that Government interferes here, and vexes him with licenses, and fees, and taxes, which those who employ him have really to pay ; and, moreover, that it says positively that he shall not, upon any terms, become a postmaster or mail-carrier, except as its servant; and that the money extorted from the people by these means, although paid directly to the Government, is needed by the Government only to pay privileged individuals, who are protected against a competition which might otherwise much cheapen and much better all these services ; but neverthe- less that Government thus interferes with natural right aril exacts money for a very good reason. The fact which Free Traders set forth as so strongly supporting their system, that "labour is best rewarded, other things being equal, in the freest commercial com- munities," they do not deny or call in question; but they vehe- mently assert that in our case it is not applicable, for the very good reason that the other things are not equal, but that Free Trade would deprive us of the benefit of our natural advantages of soil, climate, mineral wealth, and mechanical ingenuity, by reason of an artificial inequality, the consequence of a false, oppressive, and artificial state of society in Europe. The other fact presented
with equal confidence by the Free Traders, that since the preva- lence of Free Trade in the principal countries of Europe production and commerce have both increased, they set aside as not conclusive. because within that time production of every kind has greatly increased in all highly civilized and commercial countries ;—that with Protection our productions have increased enormously, not only our manufactured products, but our grain, cotton, and gold. It is a case of post hoc non ergo propter hoc. And to the question whether advantages, of whatever kind, secured by taxation of all, to bring the profits of certain branches of business up to the general standard of profits are wise, they again reply that the question is not merely what is profitable in the way of money, goods, and chattels.
Briefly the question here is this. Is it better, on the whole, for the country, as a whole, to have Protection or Free Trade ? That is, putting the question to an individual, is it better for you to get your clothes and tools cheaper with Free Trade, or to be the citizen of a country in which manufacturing is encouraged, but in which the price of clothes and tools is dearer by reason of Protection? The answer thus far has been that it is better to pay more for clothes and tools and to have Protection. Under existing circumstances, the world over, the use of our mere natural advantages, without protection against the artificial conditions of other nations, would reduce us to the production of mere raw materials,—cotton, grain, tobacco, sugar, wool, beef, and pork. Now, the condition of people who are mere producers of raw materials is one to which we do not wish to consign ourselves. Without going out of our own country, we find a warning and an example upon that subject in the condition of the old Slave States. Yet farther, we do not see in the condition of the peoples whose interest now lies in the direction of Free Trade anything to tempt us to follow their example. We, as a people, seek some- thing better, or at least something other, than to get all we can and keep all we get. As individuals, we do that in at least a sufficient degree for thrift ; but our national policy shall be such as will elevate the masses of our people. We wish to widen their intellectual life, to give them variety of interests and diversity of employment. This we cannot do if we allow ourselves to be driven as a nation into the coarse agricultural occupation of pro- ducing raw material to feed tim mouths and the mills of Europe ; and into this we should be driven, unless we were protected in some degree at least against the pauper labour of Europe. We know that as individuals we shall always buy the best that we can get for the lowest price; but when we are legislating, we are ready to protect our larger interests against our little needs and cravings. We seek this, and also to bring the producer and the consumer as nearly as possible together, so that the carrier and the middleman may absorb as little as may be of the fruits of our labour. We would not only not have all the farms here and all the mills in Europe, but we would not have all the one in New England and Pennsylvania, and all the other in the West and South ; we would see them as nearly as possible side by side all over our country. The people who think thus,—not merely the professional thinkers, the writers and the speakers,—but the reading masses all over the country, the territorial democracy, have a great respect for that varied life and that independence of other communities which is given by diversity of occupation. The impression pro- duced upon them by the march of the 8th Massachusetts Regiment to Washington at the outbreak of the rebellion, when men stepped out of the ranks by dozens to repair engines and to run them, to repair railways, and to work steamers, is one that all Mr. Cobden's speeches and all Mr. Mill's books could not do away. They believe that if it had not been for Protection, and our conse- quent ability to manufacture what we needed, the rebellion would have prevailed ; and they think that they know that the Tredegar Works, near Richmond, were worth more to the rebels than all the arms they got through the blockade from Europe. They are accustomed to see their sons, who are artizEuis, own the houses they live in, houses neatly and prettily furnished, and graced with books ; and this not at the West, but in old towns, where land is as dear and living as high as it is in corresponding places in England. They see these sons thrive, and become themselves men of business, perhaps owners of mills and forges. They believe that this could not be done without Protection ; they are confirmed in this belief by the effect in Cornwall of the recent discovery of tin in the East Indies; and therefore they are willing to pay more for the axe, and the plough, and for the railway journey, that our mines, and forges, and factories may not be closed.
It is worthy of note that the Republican party, which was made up of- Free-Soil Whigs and Free-Soil Democrats, who united against the encroachments of slavery, is sharply divided upon this question. The former are Protectionists, the latter Free Traders. The former also are the Radical, and the latter the Constitutional Republicans ; they do not affect Conservatism, either the name or the thing. It was not the former who elected Mr. Lincoln and Mr. Johnson in 1864, as some writers in England seem to suppose. The Radicals were then strongly against Mr. Lincoln, as Mr. Greeley has recently confessed for himself, and as I know from personal intercourse with them. They thought him too scrupulous, and called him imbecile, although finally they voted for him. Now the Free-Soil Democratic wing of the Republicans advocates Free Trade and opposes the policy of the Radicals in Congress on the same ground—which is with them a cardinal principle—a close limitation of the functions of Government. The Free-Soil Whigs would have had Government aid internal improvement, and foster commerce, literature, and the arts. The Free-Soil Democrats denied its right, particularly the right of the "General Govern- ment," under our Constitution, to do anything of this kind, or to interfere for the amelioration of the condition of any particular class or community. One of the declared cardinal principles of the Free Trade League is that "the less Government is felt and seen the better for all concerned," and but the other day the Free- Soil Evening Post, edited by Mr. Bryant, President of the League, asked, "Has Government (whose only instrument is force) any right to surpass its narrow legitimate function of enforcing justice and maintaining the liberty of each, limited alone by the like liberty-of all?" The difference between the two branches of the Republican party on this point is vital and irreconcilable. The discussions are constant and acrimonious. The Radicals, like the Whigs, would have Government an active influence, an informing force, and therefore they are Protectionists. The Free-Soil Demo- crats would have it as nearly as possible a police officer or sheriff ; they believe that "that is the best government which governs least ;" this, in their eyes, is the very essence of democracy ; and
therefore chiefly they are Free Traders. A YANKEE.