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William D. (William Darrah) Kelley.

Reasons for abandoning the theory of free trade and adopting the principle of protection to American industry online

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But I may remark that it was the consideration of the
question, Where shall the farmers of America find a steady
and remunerative market for their crops ? that confirmed my
adherence to protection. The circumstances were these : In
1859, during the period of doubt heretofore referred to, I
sought the privilege of renewing a neglected intimacy with
Henry C. Carey, to whom I have since gone, and never in
vain, when troubled by doubt on any economic question.
Hitherto, our intercourse had been that of earnest adherents
of conflicting systems, but henceforth it was to be that of
friends in council, or rather of teacher and pupil. I already
recognized the fact that with their surplus capital, immense
sums of which are invested in our bonds and those of other
nations which pay as high rates of interest as we do, it was
always possible for English manufacturers, in ever} r depart
ment of production, to combine, and by selling their goods,
for a season or two, in this one of their many markets, at
rates slightly below their actual cost, to destroy their Ameri
can rivals, whose capital was not often adequate to the de
mands of their business, and who, when compelled to borrow,
were subject to high rates of interest.* And I also knew that
the workingmen of this country could not maintain homes
and rear and educate families on such wages as those of
other countries were compelled to receive. But the question
that gave me difficulty was (for such I mistakenly supposed
must be a result of protection), why should the farmer be
taxed to defend the manufacturer and his employees against
such conspiracies, and this inevitable, though fatal, competi
tion ? This apparent conflict of interest it was at which I
halted, and the service Mr. Carey rendered me was that of
showing me that no such conflict existed ; but that, on the
contrary, the prosperity of the American farmer did then, and
always must, depend on the steady employment of the Ameri
can miner, artisan, and laborer, at such wages as would enable
them and their families to be free consumers of the produc
tions of the field, the orchard, and the dairy. With the clear

* See extract from Report of Parliamentary Commission, in note, page 328.



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perception of this truth, that, at least in the United States,
the prosperity of the farmer is dependent on that of the manu
facturer, and the prosperity of the manufacturer equally de
pendent on that of the farmer ; and that, in so far there was
no conflict, but an absolute harmony of interests between
them, I became a protectionist. My last doubt had been re
moved, for I now saw that the Protective System was not
chargeable with the selfish exclusiveness I had ascribed to
it, but was, in fact, the truest and most beneficent cosmo
politanism ; nay, more, that it was essential to the enjoy
ment of absolutely free trade by the American people.

Let me hastily demonstrate the truth of these proposi
tions. Trade is most free when there is an active and
remunerative demand for all the commodities that can be
produced ; and this is when the people are so generally em
ployed in remunerative pursuits that the number steadily
increases of those who, by their earnings, can, while supply
ing themselves and families with the average necessaries
and conveniences provided by modern civilization, accumu
late sufficient capital to enable them to change their busi
ness, or vicinage, as inclination, health, or circumstances may
dictate. In other words, trade is most free when the great
est number of people are able to buy or sell, to work or rest,
to spend money in travel, or for a coveted luxury or
to deposit the amount required for this in a savings bank, or
purchase therewith an interest-bearing bond. The authors
from whose works most of the notes by which I have en
forced the doctrines of my addresses and letters have been
taken, prove that the number of the people of England, Ire
land, Scotland, and Wales who enjoy these conditions, is
steadily diminishing ; that there are more than a million in
habitants of these countries who are vagrants, and more than
another million who are paupers; and that this is not because
they were born to pauperism and vagrancy, but because, at
least in a large majority of cases, they cannot get work
whereby they may earn the means of independent subsist
ence.* As freedom from customs duties does not establish
free trade, it has not enabled them to sell or buy freely. On
the other hand, the farmers of Minnesota, Iowa, Nebraska,
Kansas, Missouri, and Arkansas find that there is such a
surplus of food in the world that their trade is greatly re
stricted. Having all raised grain and live stock, there is no
chance for commerce between them, and though we are im
porting vastly more foreign goods than ever before, they can-

* See statements of Grant, Sullivan, Kirk, Hoyle, R. Dudley Baxter, Smith,
and Patterson, in notes, pages 24-5, 195-7, 267-9, 338-9, and 422.



23

not find a market for their productions at prices that will re
imburse the cost of production. These States abound in the
ores of iron, copper, lead, zinc, nickel, and other metals, and
in fuel and water-power. They all raise wool, some of them
cotton, and Arkansas is a natural silk field, in every quarter
of which the mulberry tree is indigenous ; but these exhaust-
less stores of the elements of wealth, and the forces whereby
they may be utilized, have been neglected. Had they been
largely appropriated, there would be no glut in the grain
markets of these States. Trade throughout their limits would
be both free and active. Many of the vagrants and paupers
of England have the skill to mine and smelt ores; to convert
them into wares ; to spin wool, cotton, and silk weave them
into fabrics, and color them with exquisite skill and taste.
Can we not, in lieu of homesteads, offer such of their skilled
countrymen as still have the ability to come, steady work at
such generous wages as will tempt a million or two of them
miners, smelters, engineers, machinists, spinners, weavers,
dyers, and other classes of artisans to come and open the
mines of those States, build and work furnaces, forges,
rolling-mills, and factories ? This would not only give their
farmers free trade, but by building up towns, and requiring
local railroads, quadruple the price of every acre the} - own.*
This can only be done by putting Protection on the founda
tion of a settled policy, for who will invest capital in mines, mills,
or furnaces to stand idle while we go abroad for our wares
and fabrics ? Or why should intelligent artisans come here to
be idle, or work for such wages as they can earn at home ? The
farmer should have a liberal price for his grain, but to live
well and enjoy free trade he must let others live, not
grudging the laborer generous wages for his work, or with
holding from enterprise and capital just guarantees of a fair
return for their efforts at developing the resources of a new
country. Could a million of English people, the adults
being, not farmers but miners, smelters, machinists, engine
builders, spinners, weavers, dyers, and artisans generalty,
be induced to settle in the States I have named, and pursue
their respective callings, the glut in the grain market would
soon disappear, and the freest trade would prevail between
them and the farmers. By the pre-emption and homestead
laws, we are tempting agricultural immigrants to come by
tens of thousands annually to increase our production of
grain and live stock. Protection to high wages is needed
to bring other classes. The homestead on which nothing
marketable can be raised will prove but a poor boon to the

* See notes, pages 202 and 360-1.



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immigrant. And by promoting the immigration of arti
sans, we should render to the impoverished masses of England
the highest service. By making prosperous American citi
zens of a million of them, we should improve the chances in
life of those who remained behind. The prosperity that would
result from the infusion of such an immigration into even the
remotely interior States I have named, would quicken the
trade of England ; for a prosperous people always consume
freely, irrespective of the money price of commodities. They
will not only satisfy their wants, but gratify their desires ;
and our importations are always largest when, under pro
tective duties, our labor and machinery are most fully em
ployed. The present is a striking illustration of this fact.

The existing tariff is highly protective. With a larger
free list of raw materials than ever before, the rate of duty
averages, I believe, about 40 per cent. ; yet, our imports are
vastly in excess of any former year. How are we to account
for this paradox? Thus: We are prosperous, and a pros
perous people will gratify their desires. The value of our
foreign imports during the last fiscal year was nearly 22 per
cent, greater than those of any preceding one. In the year
ending June 30th, 1866, they amounted to $444,811,066, but
did not attain this magnitude again till that which ended with
June, 1871, during which they exceeded it by nearly $100,000,-
000, having been $541,493,776. This increased importation
of foreign goods surprises no intelligent protectionist. It but
confirms his theory that protection is the pathway to free
trade : that a well protected and generous home market is
the only basis on which extended foreign trade can be main
tained.* When, as is the case at present, customs duties
are so adjusted as to countervail the lower rates of wages
and interest prevailing in competing countries, increased
importations do not come as they would under free trade,
to undermine and destroy our industries, but to supplement
them. Our productive power increases more rapidly than
our imports, and we are producing each year a greater per
centage of our total consumption. But rapid as is the in
crease of our productive power, such is our general pros
perity that our ability to purchase and consume tasks it to
its utmost in all departments save that of farming. This
is shown by the fact that in those departments in which our
production has increased most steadily and rapidly, the
home demand is so active and remunerative that it saves us
from sending so many of our goods as we did in less pros
perous seasons to foreign markets for sale in competition

* See note, page 10.



25

with the cheaper goods of Germany and England. If readers
desire proof that such is the case, they will find it on page
125, of the July number of the North American Review,
where Mr. Wells enumerates a number of articles of waich
we export less than we did in I860, and points to that fact
as evidence of declining prosperity. Every reader will
recognize the fact that our production of each of the articles
named by him has increased in a ratio exceeding that of our
increase of population, and see that the circumstance from
which the writer cunningly suggests our failing condition,
is pregnant proof of our increased prosperity, our power to
purchase and consume more than ever before. I may re
mark, in passing, that this is but a fair illustration of the
unscrupulous ingenuity that has characterized the writings
of Mr. Wells since his return from England.

Without free access to our markets, England cannot find
employment for her people or capital; but as our tariff, by
defending the home market, invites enterprise, her capital
and people can find profitable employment in developing our
resources, and both are coming.* Thus reinforced, we are
producing such a proportion of our own wares and fabrics,
including those consumed by the cotton planters and tobacco
growers of the South, that we can afford to receive in luxu
ries, or such necessaries as we need in excess of our capacity
to produce, part of the proceeds of those special agricultural
supplies which Europe takes from us because they cannot be
obtained elsewhere. This must be the solution of the para
dox, for while augmenting our imports so largely, wb
are producing not only vastly more iron, steel, lead,
copper, zinc, and the infinite variety of utilities into which
they may be converted ; of cotton, woollen, silk, and flax
goods ; of chemicals, clocks, watches, jewelry, and works of
art, than ever before; but of "dwelling-houses, cooking-
stoves, furnaces, pumps, carriages, harnesses, tin-ware,
agricultural tools, books, hats, clothing, wheat, flour, cheese,
steamboats, cars, locomotives, bricks, coal oil, fire engines,
furniture, marble-work, mattresses, printing-presses, wooden-
ware, newspapers," and a thousand other things, which, it
is falsely said, " cannot be imported to any great extent,
under any circumstances," and the production of which gives
"to the farmer by far the largest market for his produce."
So great indeed is the prosperit}^ of all classes, save those
farmers who have gone beyond the reach of a market, that
Mr. Atkinson, in his onslaught on Protection in the Atlantic
Monthly, is constrained to acknowledge that : " At the pres
ent time this country is so vigorous, and production so
great, that a vicious currency and an enormous tariff simply

* See note from Kirk, page 389.



26

appear to create uneasiness, but do not seriously impede
prosperity."

To have withheld such an admission, damaging as it is to
the author s argument, would have been still more damaging.
It gives an aspect of fairness and candor to an article that
is essentially ingenious and disengenuous ; and had it not
been made, each intelligent reader would recall the prosper
ous condition of the country as a sufficient reply to his sug
gestions : For our general prosperity is not known and felt
by ourselves only, but by the British people and government.
The Commissioners of Customs state that the amount of the
manufactures of Great Britain, taken by the United States
during 1870, was 28,335,394, adding that this is "the
largest sum ever reached in any j ear, with the exception of
the very prosperous year of 1866, when the values were 28,-
499,514, and exceeding the value of the exports of I860,
the 3 r ear before the American war, by six millions, or nearly
31 per cent." It is not unworthy of note that the only year
in which our British imports exceeded those of last year was
one of extreme protection, and that in each they exceeded
by more than 31 per cent, those of the last year of free
trade, or a revenue tariff. A leading English journal, over
looking the fact that the amount had ever been exceeded,
says : " The United States have long been the best customers
the British manufacturers have had throughout the world, and
last year their pre-eminence is more marked than ever."

Thus does current experience attest the mutual dependence
Gf the American farmer and manufacturer, and prove that for
them the protective system is the only road to really Free
Trade. That at so late a day, as it did, it should have re
quired Mr. Carey to convince me of these truths, illustrates
the almost absolute dominion long cherished abstractions
obtain over the minds of men ; for no fact in our history is
established by more abounding proof than the dependence
of our farmers on a home market capable of consuming more
than 90 per cent, of the annual crop of the country. It is
proven anew by each year s experience, and strikingly illus
trated by the statistics and general results of each of the
alternating periods of Protective and Revenue Tariffs. A
thorough examination of these results will, I am persuaded,
convince any candid mind that a rigid S3 stem of Protection
must, for many years, be the paramount political necessity
of the farmers of the United States.

But, waiving historical or statistical proof, I propose to
test the correctness of this proposition by existing facts.
The price of grain is not satisfactory to our farmers, and, as
I have more than once suggested, is not sufficient to cover
the cost of production and transportation to the seaboard



27

of the crops of the trans-Mississippi States. Is this the result
of an unusually fruitful year ? By no means. For the yield
per acre throughout the country has been considerably below
the general average. It is because too large a proportion of
our people are engaged in producing grain, and have, in a
year in which the foreign demand is exceptionally large,
produced it in excess of the world s demand. The leaders
of the corn market of England watch the progress of the
crops of the Continent as closely as they do those of the
British Islands, inasmuch as they usually draw thence from
90 to 95 per cent, of the annual deficiency. And their ad
vices for this year are as follows, as I learn from one of their
organs, published September llth: " The great deficiency in
the area under wheat on the Continent (in France and Ger
many), as reported by us in May last, could not fail to show
a very large falling off in their crop as compared with 1868
and 1869, and hence, instead of being liberal exporters of
grain as formerly, they will require to import freely during
the year. Our late advices from Russia confirm previous
estimates in regard to their crops, viz. : that their surplus
of wheat will be 10 per cent, less than last year." If, under
these circumstances, there be no market for our crop, when
and where may we expect to find one ? Certainly the near
future does not promise a European one ; for the war be
tween France and Germany has terminated, and the peasants
of both of those countries are preparing their fields for the
production of the usual amount of grain for the English
market in 1872. Nor is the remoter prospect more promis
ing. The increase of the population of Europe is scarcely
appreciable. But her capitalists adopt improved methods
of production, and the rapid extension of her railroad sys
tem is bringing her interior grain fields into cheaper and
more rapid communication with her capitals and seaports.
Under these circumstances, to anticipate a steady and re
munerative trans-Atlantic market for our grain would be
absurd. And what is the outlook at home ? For the far
mers of the remote interior it is even more gloomy. *0ur
laws offer sublime inducements to the peasantry of the
world to come and increase our production of grain. To
every one who will do this, they offer with citizenship and
free schools a farm without money and without price ; and
constantly increasing tens of thousands of them are accepting
the offer annually. I do not think it would be an exaggera
tion to place the number of new farms that will be pre
pared for crops this year, in the six States I have heretofore
named, at one hundred thousand. Who are to consume
their productions ?

Says Professor Kirk, in his admirable essays on " Social



28

Politics in Great Britain and Ireland:" " There are above
70,000 souls in the east end of London who must emigrate

speedily or die Above 25,000 of these are workmen

more or less skilled in engineer and shipbuilding occupa
tions. These are not shepherds, nor are they ploughmen,
nor will they ever be to any great extent one or the other.
They are mechanics, and will be so go where they may. In
the vast hives of industry in Lancashire there are a greater

"number who must emigrate or die Not one is either

pastoral or agricultural, and few are likely ever to be either."

Some of these, he tells, are able to get off " to Massachu
setts to find full occupation in cotton." Charity is sending
others, and the Government transporting as many as it can
to its North American provinces. Can we not prove our
cosmopolitanism, and our desire that all men may trade
freely, by giving 150,000 skilled workmen of London and
Lancashire the guarantee of steady work at generous wages,
and so open a way for the employment of those who, for the
want of passage money, must otherwise die, as BlacTcwood
says, "from sheer famine in the heart of the wealthiest city
of the world ? " What a market would they and their fami
lies create for farm products in all their varieties, and how
immensely and rapidly would the application of their skill
and industry to our undeveloped resources increase the gen
eral wealth of the country !

Let the report of our high wages, with assurances that these
shall be protected by law, be made in all the great industrial
centres of Great Britain, France, Belgium, and Germany,
as the freedom of our public lands has been in the pastoral
and agricultural districts, and our farmers will not long
want a market. But this involves the maintenance of a
rigid and generous system of Protection. In the ad
dresses and letters, which compose this volume, the reader
will find little else than the application of the principles
here enunciated to questions of policy as they have arisen
since the suppression of the rebellion.

In advocating such a system of Protection as would en
able our miners and manufacturers to pay wages sufficiently
liberal to induce skilled workmen to immigrate and enable
them to become liberal consumers, I have believed that I was
asserting and defending the right of the American farmer to
a market a remunerative market for his crops. Should
this volume convince any number of my countrymen of the
correctness of these views, it will vindicate the judgment of
those who persuaded me to prepare it for publication, and
gratify the most ardent wish of

THE AUTHOR.

PHILADELPHIA,

November 1st, 18U.



29



APPENDIX.



(Extracts referred to on page, 12.)

LET us for a moment think what are the conditions of our poor to-day. Apart
from the question of our agricultural population, whose almost hopeless lot is best
told by the simple fact, that in many places the luxury of meat t comparatively
unknown; apart from the questions of special emergency, such as the cotton
famine, or the East End Emigration Society, which has been brought into exis^
tence for the purpose of relieving the great mass of destitution and poverty in
that neighborhood ; apart from all such special and exceptional cases, we have
the general sense of depression and want everywhere spread around us. It is
not necessary to dwell on the scenes of human misery, where wholesale suicides
or cruel murders mark the profound despair of those who lay trembling on the
confines of want. It is equally unnecessary to recall those verdicts that appear
time after time at coroner s inquests under the simple but expressive phraseology
" Death from Starvation." It is not necessary to recall these things, because
the newspaper press of the country drives these truths home without stint and
without compromise ; but it may be important to remember that the individual
oases, which thus come to the surface, are known only by accident, and that the
great mass of misery that suffers and dies, dies and tells no tale. Occasionally
and by accident the curtain is drawn on one side, and we see into the midst of
the life of poverty that surrounds us; and we then know by the glance thus
afforded us, what the general life must be ; wasted by poverty, decimated by
fever, shattered by want ; and it thus rises before us, in the full force of its ap
peal to that sense of human sympathy which is common to us all. But the
general acceptance of the positions here stated will be aided by a few facts. Let
us see what the barometer of pauperism has to tell us. Our pauper population
in 1866, was 920,344; in 1867, 958,824; in 1868, 1,034,823; a nd the number is
still increasing; yet these numbers show that our pauper population has in
creased 114,479 persons in two years, or at the rate of more than 1000 per week.
Home Politics, by Daniel Grant, p. 3. London, 1870.

We are told that our manufacturing industries, far from being ruined, are
prosperous. It is true they are not yet ruined, but many are more depressed
than they have ever before been. Very many of them are sick very sick ; far
more so than those unacquainted with them have any idea of, and a few years
more of such depression will see many of them in extremis. There are ma,ny
who argue that our manufacturers would at once give up manufacturing if it did
not pay; and no doubt it is a very natural assumption, that if a manufacturer
continues his business it is a proof he is making money by it; but it is
very often the case that he continues to manufacture only because he cannot
afford to stop. They little know how many manufacturers continue to struggle
on in business merely because they do not know how to get out of it. A man
with twenty, thirty, fifty, or a hundred thousand pounds sunk in works and ma
chinery cannot give up business without ruin. The causes that diminish the


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Online LibraryWilliam D. (William Darrah) KelleyReasons for abandoning the theory of free trade and adopting the principle of protection to American industry → online text (page 3 of 4)