1905-1907 Republican Congressional Committee.

Republican text-book for the Congressional campaign, 1906 online

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iny, John N. Fairthorn, and Fred. A. Wann, for giving rebates


on dressed meats and packing-house products shipped from Kan-
sas City, Kans., to Chicago and eastern points by the Schwarz-
child & Sulzberger Company and for refunding passenger fares
paid by the officials of that company for traveling over the Alton
road. Special pleas in bar to the indictment were filed, to which
the Government interposed demurrers, which were sustained.
This case is now pending.

Indictments for Rebating.

December 15, 1905, indictments were returned in the eastern
district of Missouri against a number of railroad companies and
individuals, charging them with violations of the Elkins law in
the demanding and receipt of rebates. Some companies in the
beef trust were made defendants in these cases. Several indict-
ments were found and convictions ensued in the cases of several
individuals. The Uniteyfl States will ask the court to impose a
sentence of imprisonment against the individuals and fines
against the corporations.

December 29, 1905, an indictment was returned in the northern
district of Illinois against the Chicago, Burlington and Quincy
Railway Company, D. Miller, and Claude G. Burnham for giving
rebates in violation of the Elkins law.

To this indictment the defendants entered pleas of guilty, and
fines aggregating $60,000 were imposed by the court.

Three other important cases in this same category have been
brought, one against the Suffolk and Carolina Railway Com-
pany, another against the New York Central and Hudson River
Railroad Company, and another against the Delaware and Hudson
Company for giving rebates, and are now pending.

Sustaining the Colored Man's Bights and Protecting the
Colored Man's Liberties.

Under the present Republican Administration the Government,
through the Department of Justice, has taken action in the Fed-
eral courts, winning out at last in the United States Supreme
Court, which will go further toward protecting the rights and
liberties of the colored people in the Southern States than any-
thing that has happened since the Civil War.

Complaint was made to the Federal authorities that through-
out the South a practice existed under what is known as the
"peonage statutes," by which men were held to labor for a debt.
In almost all the cases the victims were colored men. Practi-
cally they were held in slavery, for means were found to keep
them from getting free of debt, and as long as they remained in^
debt, they were virtually in bondage to their creditors. Investi- ^
gation of the complaints revealed some most atrocious and hearty
rending cases of cruelty and practical slavery that almost rivaled ■
the days before the war.

The Government took quick action. The first case which was
tried was argued in March, 1905, although prior thereto several
hundreds of indictments had been returned. Action on these in-
dictments was suspended awaiting the determination of the case
of Clyatt V. The United States, brought under the thirteenth
amendment to the Constitution.

The state of peonage, in which many persons were held, con-
sisted in holding a man by compulsion to labor for a master to
whom the peon owed a debt. Creditors coihpelled debtors-
usually colored men — to work out their debts. The custom was
very prevalent, and had its origin in the United States when the
Territory of New Mexico was acquired.

The Government contended that compulsory service of this
kind was, in fact, a form of involuntary servitude and there-
fore forbidden by the thirteenth amendment to the Constitution,
which was passed, under the auspices of the Republican party,
to give the negro his rights. It was also insisted that the amend-
ment gave Congress the power to enact laws which should punish
individuals who, not acting under State authority, attempted,
with particular reference to this case, to hold or return persons
into a state of peonage. The Supreme Court held that the Gov-


einment's contentions, which were personally argued by the
Attorney-General, were well founded; and, though the particular
offenders in this special case escaped because the court held that
the record did not contain sufficient evidence to justify their con-
viction, the effect has been most salutary.

An authoritative exposition of the law was obtained, and no
person within the jurisdiction of the United States can be here-
after compelled by individuals to w^ork out a debt as a peon.
-Following this decision the other indictments were pressed, and
the result is that this form of involuntary servitude is being
■stamped out.

After this decision the Attorney-General personally argued
another case Involving the interpretation of the same amend-
ment. In this it was found that a number of men had con-
spired to prevent some colored men, who were at work at a
lumber mill, from performing their contract. The colored men
were driven away from their work by armed force and intimi-
dation, and these acts of violence were committed against them
because of their race. The Government contended that to deprive
a man of any measure of his right to work solely for the reason
iof race prejudice is an interference with the right of freedom
guaranteed by the Constitution.

• The court decided that the Government could not punish, but
undoubtedly the States may punish such intimidation. Two jus-
tices of the Supreme Court, Mr. Justice Harlan and Mr. Justice
Day, were of the opinion that the Government ought to punish.

Government Helps Railroad Men.

One of the most important cases which the Government of the
United States, under the Republican Administration, has fought
Successfully in the courts was the case of Johnson, an employe
of the Southern Pacific Railroad Company, against that company
for dam.ages under the safety-appliance law. Johnson fought his
case through the lower courts and was getting the worst of it,
when his money gave out. An appeal was made to the Govern-
ment, and the Department of Justice took up the case and car-
ried it to successful issue in favor of Johnson before the Supreme
Court of the United States.

The decision set a hard and fast rule in certain cases of per-
sonal injury, from which there can be no appeal, and which
should operate in the future to enable every railroad man who
receives injuries under the peculiar circumstances which pre-
vailed in this case to make an appeal successfully for damages.

This was an action for personal injuries sustained by the
plaintiff Johnson while engaged in coupling an engine to a
dining car. The railway company is an interstate carrier and
v/as alleged to be liable for damages under the safety-appliance
law passed by Congress, which provides, in substance, that inter-
state carriers must equip their cars with automatic couplers
which shall couple by impact. The engine and car were each
fitted with automatic couplers, but, being of different makes,
they failed to couple, and when the plaintiff went between the
engine and the car to couple them he received his injuries.

Johnson was unsuccessful in the circuit court, and also in the
circuit court of appeals, whereupon he filed a petition for a writ
of certiorari in the Supreme Court, which was granted.

Owing to the great importance of the case to railway em-
ployes, the Government took an almost unprecedented step and
'Obtained leave to intervene to argue the question relating to
the proper construction of the remedial legislation of Congress,

The Government contended that an engine is a car within the
meaning of the law, and that the law is not satisfied unless the
aiitomatic couplers couple by impact. An amendment to the law
has passed since this case arose, making it clear that engines
must have automatic couplers. This act, the Government con-
tended, was merely declaratory of the intent of the first act.
There was a further question in the case as to what constituted
an interstate car, which the Government argued. The defendant
contended that the dining car, because it was not en route, but
was upon a siding, r^though ready for use and about to be used,
was not an interstate car. The Government, on the other hand,


contendod that a car regularly employed on interstate journeys
does not lose its character because it is temporarily delayed.

The Government's contention received the unanimous approval
of the court, and Johnson won his case.

Not content with this, the Government went further, and the
Attorney-General issued a letter of instruction to all United
States attorneys, in which he said:

It does not appear that any question onn now arise as to the proper
Interpretation of the law, since this decision apparently settles every
'disputed point.

And the United States attorneys were informed that "the
Oovernment is determined upon the strict enforcement of these
statutes," and they were instructed to pay particular attention to
all cases of their violation brought to their attention by the Inter-
state Commerce Commission or its inspectors or by other persons.

Later, in the case of The United States v. The Southern Rail-
way Company, the law was still more clearly interpreted and
further strengthened. A strong point of this decision was that
the exercise of reasonable caf^ or due diligence on the part of
the railway company is no defense to an action brought to re-
cover the penalty for violation of the safety-appliance laws of
1893 and 1896.

In both of these decisions it was strongly emphasized that the
purpose of the law was to protect the lives and limbs of men,
and that it will be so construed by the courts as to accomplish
that purpose. What law plainly requires is the equipment of
cars with cou;»Icrs which will automatically couple with each
other, so as to render it unnecessary for men to go between the
cars either to couple or uncouple.

These decisions have enabled the Government to obtain an
effective enforcement of the law in practically all cases, and
have brought about a vast improvement in conditions through-
out the country. Since the decision against the Southern Rail-
way Company no case has been contested in the courts. The
carriers prefer to confess judgment and pay the penalty in cases
of violation rather than to stand the chance of adverse judgment
on a trial.

As a result the Interstate Commerce Commission have been
able to secure the observance of a rule, practically in operation
throughout the country, whereby the different carriers are re-
quired to refuse to accept interstate cars in exchange unless
the safety appliances are in proper condition.

Another beneficent phase in this case for the railroad men
is that the intervention of the Government and the decision of
the court is warning to the railroad companies that the Gov-
ernment is looking out for the interests of the employes under
this law.

Some National-Bank Cases.

The Government has been very vigilant in enforcing the na-
tional banking laws. Under this Administration several im-
portant cases have been tried.

In the eastern district of Pennsylvania Henry Lear was in-
dicted, charged with misapplication of the funds of the Doyles-
town National Bank, and was sentenced to five years in the
penitentiary. He sued out a writ of error, and the case is now

In Wisconsin Frank G. Bigelow was charged with misapply-
ing the funds of a national bank at Milwaukee, and was sen-
tenced to ten years in the penitentiary.

M. C. Palmer, of New York, was charged with the misap-
plication of funds of a national bank while acting as its presi-
dent, and was sentenced to five years at Albany.

The celebrated Cassie Chadwick case in Ohio was prosecute d
by the Government, and the defendant was sentenced to a term
of ten years in the Ohio penitentiary for conspiracy in the mis-
appropriation of the funds of the Citizens' National Bank of
Oberlin. Ohio.

Arthur B. Speer was jointly indicted with Cassie Chadwick
and was sentenced to seven years in the penitentiary.

In the northern district of Iowa, W. E. Brown, a national-bank
official, was indicted for violation of the national-bank law.s.
He was sentenced to five years in the penitentiary.


The Tariff.

Since that 4th of July, 1789, when George Washington signed
our first tariff law, a tariff "for the support of the Government, for
the discharge of the debts of the United States, and for the pro-
tection and encouragement of manufactures," we have enacted
between forty and fifty tariff laws culminating in what has been
known as the Dingley law, approved July 24, 1897, and under
which we have been operating to the present time.

During a large portion of our history the tariff has been made a
political issue. It is the only issue by which the' Democratic
Party has been completely victorious in the nation in the single
instance when it gained the Presidency and both Senate and
House since the inauguration of Abraham Lincoln in 1861. The
victory of the Democratic Party in 1892, like the victory of the
same party in 1844, was due to questionable methods of present-
ing certain phases of our industrial situation to the voters of the
country. Up to that time we had never been so prosperous as
we were during the year 1892, at the close of which a free-trade
President and Congress were elected. The people were
deceived during that campaign as they were deceived
during the campaign of 1844, which resulted in the election of
Polk and Dallas and a free-trade Congress. It will be well, then,
for the voters of 1906 to study carefully, first, the effect of our
tariff laws in general, and to study in particular the comparison
between the operation of the so-called Wilson-Gorman law, which
was in effect from 1894 to 1897, and the Dingley law, which
has been in effect since.

Tables showing the various phases of our industrial and com-
mercial life will be presented on the following pages in which
these comparisons can be seen. Even Free-Traders do not and
cannot deny that the Dingley law has been the most successful
tariff law that we have ever had. They do not and cannot deny
the wonderful strides of progress and prosperity that we have
tnade and the advancement that has come year after year under
the operation of our present tariff. Protectionists are content to
let the present law stand without change or amendment so long
as present conditions prevail. When there is a substantial sur-
plus of revenue; when there is a balance of trade exceeding
over $500,000,000; when every man and woman in the country
who wants work and is worthy of it can find employment at high
wages; when we are able to absorb a million immigrants a year
without displacing any home labor; when our annual output of
manufactures, even reaching the enormous values that have been
attained during recent years, are insufficient to meet the demands
of our prosperous people; when our consumption of the necessa-
ries of life are not only greater in the aggregate and per capita
than is known elsewhere on earth, but greater than at any pre-
vious time in our own history; when our savings and investments
and enjoyments of luxuries in addition to the necessaries of life
reach, year after year, record-breaking figures; when our bank
clearings exceed annually $150,000,000,000, three times the amount
attained in 1896 under the Wilson-Gorman tariff, then it is that
Protectionists say: "Let well enough alone and leave revision till



siK'h a time as the conditions of our finances, commerce and in-
dustry demand." On tlie other hand, our free-traders or, as they
prefer to call themselves, reformers and revisionists, maintain
that the time has come when our industries no longer need pro-
tection and that the tariff is simply a method of robbery and a
condition which enables our manufacturers to form monopolies
and control prices. It will be well, therefore, to study this ques-
tion most carefully, both in the light of past history and with an
investigation of more recent and present figures and conditions,
I'^or that purpose it seems best, on the following pages, to present
ihe various phases of this question in order that we may reach
ri honest conclusion as to whether it is advisable, under pres-
iit circumstances, to think of changing our tariff in the least
tlegree. The fact that we are importing $500,000,000 or $600,000,-
000 worth of manufactures yearly shows that even with the pro-
tection which we now enjoy we are not able to keep out the wares
of foreign competitors, A slight reduction in many of our
schedules would result in the dumping into our market of per-
haps a billion dollars' worth of manufactures annually more
than we now import. That would mean a resort to one of two
things: We would have to close our mills or reduce wages.
There is possibly no other alternative.

Protectionists do not claim that schedules are sacred and
never to be altered. They do claim, however, that the so-called
American system of protection as exemplified by the operation
of the Dingley law for nine years is sacred and must be main-
tained. We do not have to theorize in the least degree on this
subject; we do not have to resort to guesswork; we do not have
to base our conclusions upon supposition. We have tried and
tried thoroughly both high and low tariffs and we have experi-
ence as an example to guide us in reaching the truth.

We need go back no further in our history than a decade to
learn that a low tariff means insufficient revenue, means a
closing of our manufactories, means idleness for millions of our
laborers and low wages for other millions and unprofitable prices
for our farmers. Three years was quite sufficient time, for in-
stance, to test the value of free wool. It did not help our manu-
facturers, but it came near ruining the industry because of the
inability of the people to pay profitable prices for woolens, Whea
it is understood that a considerable more than half of the value of
our products in manufacturing is made up of the value of so-
called raw material, and that fully two men are employed upon
the preparation of that raw material where one man works in
turning it into the finished product, it will be seen what a de-
lusion is the free-trade cry for free raw material or even cheap
raw material. We have free cotton, and yet we buy $50,000,000
worth of cotton goods from abroad, England has free raw ma-
terial and cheap labor and yet we have passed her in the posses-
sion of foreign markets. There is no example in all history
where free or cheap raw material and cheap labor has any ad-
vantage whatever over our own system of Protection to all our
labor and all our industries. In every section of the country, for-
tunately for our people, the predominant party to-day is har-
monious and united upon the central idea of maintaining a pro-
tective tariff. A mere handful, however, of the Republican Party
have been asking that the duty be removed or reduced upon
certain materials entering into the products of their own locality.
It is believed that this demand has been made more for political


than economical results. We have heard perhaps more of free
hides than of anything else, though some have asked for free
lumber, free wood pulp and free coal. It is not claimed by those
who asked for free hides that consumers would get their boots
and shoes for a single cent less in price. It is not promised that
the laborers in that industry would get a cent more in wages.
There is but one inference, then, and that is that if any one
gained any advantage it would go wholly into the pockets of the
manufacturers, and yet it can readily be shown that even that
could not be true, for the demand for their wares would fall off
from the consumers, who would lose the benefit of the moderate
•tariff now imposed upon the material which they sell.

It is designed to present every phase of the tariff question in
the following pages, through the tables presented and the various
extracts from speeches, documents and other data which is given.
It is the purpose of the editor of this work to present the subject
simply as it exists to-day without any idea whatever of presenting
any extreme view, or anything but a rational and absolutely fair
picture of present-day conditions added to historical facts and

Protection and Free-Trade.

As it has been agreed by our economists that a tariff for
revenue only is also practical free-trade, it may be well to define
and explain clearly just what is meant by the terms Protection
and Free-trade. There is probably no better definition of the term
Protection than that given by Senator George F. Hoar, as follows:

Protection, as used in our political and economic discussions, is the im-
posing of such duties on the importation' of foreign products as will pre-
vent a domestic producer of the same article from having his business
destroyed by the competition of the foreign import, while he establishes
it ; or will enable him to maintain the production, without its being de-
stroyed or rendered unprofitable by the competition of the foreign article
after it is established, when he could not otherwise so" establish or main-
tain it ; or the enabling him to pay larger wages in such production than
he C0UI4 pay if he were subject to the foreign competition.

The term Free-Trade has never had a better explanation than
that given by its foremost apostle and advocate in this country,
Professor W. G. Sumner:

Free-Trade : The term "Free-Trade," although much discussed, is sel-
dom rightly defined. It does not mean the abolition of custom houses,
nor does it mean the substitution of direct for indirect taxation, as a few
American disciples of the school have supposed. It means such an ad-
justment of taxes on imports as will cause no diversion of capital from
any channel into which it would otherwise flow, into any channel opened
or favored by the legislation which enacts the customs. A country may
collect its entire revenue by duties on imports and yet be an entirely
Free-Trade country, so long as it does not lay those duties in such a way
as to lead any one to undertake any employment or make any investment
he would avoid in the absence of such duties ; thus the customs duties
ipvied by England, with a very few exceptions, are not inconsistent witli
her profession of bein,f!j a country which believes in Free-Trade. They
either are duties on articles not produced in England, or they are exactly
equivalent to the excise duties levied on the same articles if made at home.
They do not lead any one to put his money into tlie home production of
an article, because they do not discriminate in favor of the home pro-

It therefore follows that duties which are not Protective, in
other words duties which are not fully equal to the difference in
the cost of labor in the United States and the cost of the same or
similar labor on the same article abroad, are Free-Trade duties,
in fact, and in effect, just as much as if there were no duties
whatever upon the commodity so far as affects our ability to pro-
duce that commodity at a prevailing labor cost. If, for instance, a
duty of thirty cents is necessary upon a yard of cloth to keep out
a yard of similar foreign-niade material, and the duty is then low-
ered to twenty-five cents a yard, thereby enabling the foreign


producer to pay the duty and enter our markets at the same
or a lower price than is quoted on our own production, then the
duty of twenty-five cents results in Free-Trade in that commodity.
When, therefore, Free-traders are shy of using the term and re-
sort to the terms of Tariff Reform, Tariff Reduction, Tariff Re-
vision, etc., they are begging the question and deceiving both
themselves and their followers. Our duties must be either Pro-
tective duties or Free-Trade duties, and the' moment they cease
to be Protective they result in Free-Trade. The terms Protection
and Free-Trade will, therefore, be used, and used honestly and
fairly throughout this work.

History of Our Tariffs and Various Revisions.

From the time of the landing of the Pilgrims in 1620 to the
formation of our Government under a constitution in 1789 there
were in this country no general duties upon imports; in short,
we were living under Free-Trade, and foreign nations were able
to place in our market without restraint every article which we
were liable to buy. After we had secured independence and

Online Library1905-1907 Republican Congressional CommitteeRepublican text-book for the Congressional campaign, 1906 → online text (page 12 of 42)