REUNION OF THE UNITED STATES AND CANADA.

THE for and and Canada are presented

`HE arguments for and against the political union

and forcibly discussed in the American Journal of Politics by Hon. Francis Wayland Glen, ex-Member of the Canadian Parliament. Mr. Glen takes as his text Prof. Goldwin Smith's recent statement ' that the union of the two great English-speaking communities who now occupy and control this country would drive war from the United States and change the whole country to peaceful industry and progress. It would remove all internal customs lines and it would make the St. Lawrence, the fisheries and all questions which are now the subject of dispute, the undisputed heritage of all." Mr. Glen maintains that Professor Smith's conclusions cannot be successfully disputed, and he urges that the subject should be discussed in a liberal, kindly spirit on both sides of the boundary line, fully convinced that union can only be accomplished peacefully under full, free and public discussion in the press and upon the public platform in both countries.

MANY CANADIANS DESIRE POLITICAL UNION.

We are assured by Mr. Glen that there are many Canadians who earnestly desire to see political union peacefully consummated and who are quite willing and ready to make personal sacrifices to promote and secure it, but these persons "need and deserve a public declaration of assurance in unmistakable terms from a large, non-partisan organized body of American people, representative of public opinion in this country, that when they have educated and prepared a majority of the Canadian people to desire and seek reunion, Canada will be gradually received upon terms just and generous into an equal and honorable union." Especial emphasis is given to the fact that union with Canada will prevent the causes most likely to involve this country in a serious conflict with Great Britain and will make it possible to create and establish a moral union between America and the motherland. This he believes to be of far more importance to the several branches of the English-speaking race throughout the world than all the commercial and financial advantages to flow from it to the people of North America. He does not regard as serious the objection raised that under such an arrangement there would naturally be a solid Canadian vote. The late Secretary Seward, as long ago as 1867, declared that the interest of the English maritime provinces would always be with those of the Atlantic States; that those of the great central Protestant State of Ontario would be with that of New York and Ohio; that the interest of British Columbia would be with our Pacific States and that of any States organized between Ontario and the Rocky Mountains would be with our Northwestern States. These conclusions of

Mr. Seward are held by Mr. Glen to be as valid today as when published.

"AN EQUAL, AN HONORABLE UNION."

Mr. Glen proceeds to say that imperial federation, as a desirable and a practical solution of the future relation of the United States to Canada and the British Empire, has no substantial support in the Dominion. A federation of the several branches of the Anglo-Saxon race with the United States left out is, he declares, not worth a moment's consideration, and if attempted, in order to prolong Great Britain's control upon the continent, it will sooner or later lead to a war for the complete supremacy of the Republic in North America. Unrestricted reciprocity and commercial union as a settlement of the question are passed over as "unsubstantial dreams" so long as Canada remains a British dependency, and independence for Canada is considered practical only as a preliminary step toward continental union. Mr. Glen states as a result of his personal observation, covering a period of forty years, that the Canadian people are steadily becoming less English and more American in their habits, customs, sentiment, spirit. aspirations, institutions and legislation, and, he makes the surprising statement that nearly one million nativeborn Canadians, or one-fourth of all living Canadians in the world, have become residents of the United States. 'If," says Mr. Glen, "imperial federation, unrestricted reciprocity, commercial union, independence, status quo and an equal and honorable union' with the United States were offered to the

people of Canada for acceptance or rejection through

66

the ballot box, and after calm and free discussion in the press and upon the public platform a majority of the electorate would decide in favor of an equal and honorable re-union' with our neighbors upon this continent," and "if," he continues, continental union is, as has been sent forth, one of the most important questions before the people of the United States and Canada, and its consummation will secure beneficent results to both of the great communities involved, there is not any valid reason why the more numerous and powerful people should not publicly declare their willingness to accept it as a final and peaceful solution of their relations with the less numerous and therefore less powerful people, nor is there any reason why either community should not use all lawful, peaceful and honorable means to hasten its consummation.

SUBMIT THIS RESOLUTION.

'If a large non-partisan organized body of American citizens, fairly representing those who create, control, and direct public opinion, should adopt and publish as an expression of public sentiment in this country a resolution similar to the following, it could not wound the feelings of the Canadian people, or

justly offend them, but would certainly hasten a solution of our relations to that great Anglo-Saxon community.

"Resolved, That we believe that the political reunion of the two great English-speaking communities, who now occupy and control North America, will deliver the continent from the scourge of war and dedicate it to the arts of peace, lessen the per capita cost of government and defense, insure the rapid development of its unlimited natural resources, enlarge its domestic and foreign commerce, protect and preserve its wealth, resources, privileges and opportunities, as the undisputed heritage of all, and promote, extend and perpetuate government by the people. We therefore invite the Canadian people to cast in their lot with their own continent, and assure them that they shall have all that the continent can give them. We will respect their freedom of action, and welcome them, when they desire it, into an equal and honorable union."

as to "who pays a tariff duty; in what instances is it added to the price paid for a commodity by the consumer, and in what instances is it deducted from the price received for the commodity by foreign producers." Mr. Gunton clears the field by pointing out that each commodity affected by a tariff tax differs from every other commodity in the tariff schedule in the mode in which the duty will affect the price. If, he explains, the article be producible only abroad and must be imported, and if the demand for it will compel its importation, as in the case of tea, coffee, unrefined sugar and tropical fruits, the whole duty will be added to the price, but if it has been more largely and cheaply produced here than elsewhere, like hay, potatoes and grain, the duty will not affect the price in the least. The tariff is merely the dam, and, like a dam, it can only raise a level where it crosses the flow of a vigorous commercial current. The whole nomenclature of the tariff discussion and the terms used in party platforms on both sides to define the nature of a tariff, such as tariff for revenue' and 'protective tariffs,' fall speedily into a muddle in any attempt to apply them to actual cases, because these terms assume a uniformity in the effect of duties when applied over many articles and in each article over long periods of time when any uniformity can exist as to either."

The following illustration is given to show when a tariff may be considered protective and when "for revenue:" "If a duty were imposed on the importation of wooden idols into an idolatrous country, of small constructive skill, the duty might yield a heavy revenue. Imposed by the United States it might be a dead letter, as none might seek importation. But if clergymen began to use them in illustration of their sermons on the heathen, an importation into the United States of the wooden idols would begin, and a specific duty on them of fifty cents each might begin

to yield a revenue, in which case the consumer-i. e., the preacher-would at first pay the whole duty."

THE INCIDENCE VARIES.

"The incidence of the duty," continues Mr. Gunton, "varies greatly in every tariff list. The best means of arriving at it is first to ascertain the rate of the duty from the statute; then take the last volume of our official reports of commerce, immigration, etc., and find out whether the article is one whose imports dominate over its exports, or vice versa. If it is one of insignificant import and large export, then the price in this country averages lower than abroad, and its major flow is outward. If it is one of large import and little or no export, its price abroad averages lower than here, and its average flow is inward. Then take the census of other statistics of domestic production, and by their aid compare the quantity of the importation with the quantity of the domestic production. If the importation is insignificant, the export large, and the domestic product is ten to twenty times larger than either, a strong presumption arises that the domestic production is the controlling factor in fixing the price, and that the cost per unit of product is lower here than abroad. In such a case, no duty on the importation can be very potential over the price. If, as in the case of crude sugar, our importation is eleven times as great as our product, the flow is inward and the tariff is a tax to the full amount of the duty. Upon crude sugar brought from Cuba, the American consumer (or refiner) pays the whole duty. Upon coal from Nova Scotia, he usually pays no part of it. Hence a duty on sugar is protective, on coal purely for revenue."

From these illustrations Mr. Gunton concludes that the question whether a duty is protective, or produces revenue, depends upon facts extrinsic to the law and growing out of prices and productions. "The pretense, therefore, that a statute can be constitutional one day and unconstitutional the next, according as some American may or may not produce a product which competes with that on which the duty rests, would be too absurd to be voted for, if all men understood the tariff question as well as they do their private business. A duty of fifty cents per pound on tea levied to-day would be wholly a revenue duty. Therefore, says a party platform, it is constitutional. But to-morrow, owing to the duty, some planter begins to produce it. Lo! instantly the duty, according to the same platform, has become protective, and is therefore unconstitutional. Perhaps the producer who thus changes a statute from constitutionality to unconstitutionality is a Chinaman or a tribal Indian, who has not even a vote. Such a view of unconstitutionality is itself unconstitutional in that it makes constitutionality of a statute to turn upon facts outside of the statute itself."

A GENUINE TARIFF FOR REVENUE. In the editorial "Crucible" of the Social Economist, Mr. Gunton comments on the New York Sun's interpretation of what is meant by a genuine tariff for revenue, that paper holding that such a tariff is one

"levied alike upon all articles imported whether they are produced in the taxing country or not." Mr. Gunton's reply is that a genuine tariff for revenue only must be levied so as to yield revenue without any incidental protection to anybody. "There are only two methods of levying a genuine tariff for revenue only, neither of which form any part of Mr. Wilson's haphazard bill or Mr. Dana's horizontal thirtyfive per cent. scheme. One is to confine the duties exclusively to non-competing products and the other is to levy the same duty upon home products as is levied for foreign products. Any pretended tariff for revenue only which does not adopt one or both of these conditions is a veritable sham born of ignorance and deception."

IN

THE DEMOCRATIC TARIFF POLICY.

bill that taxation can be laid not for revenue, a public purpose, but solely for private interests, to kill competition, encourage trusts and cut off revenue.

"The country deliberately-emphatically-said in 1890 and 1992 that the Democratic policy was right in principle and would be beneficial in its results. It is hardly conceivable that its mature judgment, twice expressed, was wholly wrong. It certainly is no proof of this that a great business depression has come under another tariff policy, which by the same judgment the country condemned and ordered to be repealed."

A PLAN FOR AN AUTOMATIC TARIFF.

IN and discusses the plan for

N the Forum, Representative William J. Coombs,

N the opening article in the North American Review, Governor William E. Russell seeks to show that the recent business depression was due to Republican legislation rather than to impending Democratic legislation. After several pages of argument in support of this belief, Mr. Russell explains, as he understands it, the tariff' policy of the Democratic party. He says: "This policy is a revenue tariff with a reduction of duty to cheapen the necessaries of life and to give free raw materials to our industries. This it has declared in State and national platforms, formulated in bills and voted for in Congress. This it is pledged to give in its new bill, which means free wool, coal, iron ore and other raw materials and fair and proper reduction on finished products. The Democratic party says that every reason which made hides free demands that wool be free, and it proposes to act upon this belief. The great advantage of free silk to the silk industry, of free rags to the paper industry, of free hides to the boot and shoe and leather industries, can and ought to be extended to other industries as a benefit not only to all the people as consumers, but to the industries themselves, giving them a larger market here and a better chance to send their products into foreign markets.

A REVENUE TARIFF AND FREE RAW MATERIAL.

"This is the policy of the Democratic party as declared in its platforms, formulated in its measures and supported by its votes. It advocates a revenue tariff, remembering that revenue has been the basis of every tariff, even our war tariff, until 1888, when another principle, controlling the Republican party, supplanted it and found expression in the McKinley bill. It believes that a tariff which gives free raw materials and cheaper necessaries of life, and which is required to raise a revenue of nearly two hundred million dollars, is a conservative measure and a benefit to industries as well as to the people. It does not believe in tariff taxation which has for its purpose and result taking from one to give to another, or burdening all to enrich the few. It opposes the principle of the McKinley

revising the tariff which he introduced in the House of Representatives during the recent extra session. Mr. Coombs' plan is based upon the principle that taxes upon the people should not be in excess of the necessities of the government, and to this end provision is made for automatically adjusting the revenue derived from the tariff so as to supplement that yielded from other sources of taxation. Mr. Coombs would first ascertain what the requirements of the government are, and by deducting from that sum the estimated amount receivable from all other resources, find the amount necessary to be raised on imports.

HOW TO LEVY THE IMPOST WITHOUT DISTURBING COMMERCE.

The difficulty of Mr. Coombs' plan would be how to levy the impost without disturbing the commercial interest of the country. "Of course," he says, "if all articles could by their nature pay the same rate of import duty. the problem could easily be solved by fixing the percentage necessary upon the estimated amounts of imports. But all articles do not stand upon the same basis, and hence such a course would work great hardship. This consideration led to the suggestion of various schedules which should not share in the uniform rate of duty. The first was the free-list, toward the making of which the people have assisted Congress by their declarations at the last two elections, that all raw material necessary to the manufacture of goods should be admitted free of duty. The second schedule would embrace partially manufactured raw material such as must be used again in manufacture, and upon which the duty, even under the McKinley tariff, does not exceed ten or fifteen per cent. Since it would be manifestly unfair to those who pay internal revenue taxes to place them in the same schedule as those manufacturers who are not burdened with that tax, the articles on which an internal tax is levied, which are few in number, consisting chiefly of wines, spirits, cigars and tobacco, should pay a rate of duty which will bring a good revenue over and above the amount of the internal revenue on them."

Having eliminated all the foregoing class of articles from the list of importations, Mr. Coombs thinks that the remaining classes would not suffer by being sub

jected to a uniform rate of ad valorem duty sufficient to meet the requirements of the government. This rate, he thinks, could be changed year by year as the sum of the necessary revenue required. The main objection to this arrangement is that it would subject the importation of the unspecified classes every year to a varying rate of duty; but Mr. Coombs holds that upon all goods to which the variable duty would apply it presents an obstacle no greater than the ordinary fluctuations which merchants have to confront every year. In order to ascertain how great this fluctuation would be, he has examined the estimates and expenditure of the government for three years in which there were the ordinary fluctuations, and finds that in no two years was there a difference of more than 5 per cent. He further estimates that in years of ordinary expenditure the duty necessary to be levied on the unspecified list would not be far from 35 per cent., and believes that this rate of duty, Iwith the additional benefit derived from free raw material, would doubtless prevent the foreign competitors from unloading their surplus upon our own markets.

A

NECESSITY FOR IMMEDIATE TARIFF REDUCTION. LSO in the Forum, Mr. A. Augustus Healey argues for "Immediate Tariff Reduction." There is in delay, he holds, serious danger, not only to business, but to tariff reform itself. He thinks, moreover, that the financial panic through which we have just passed has furnished us an opportunity for putting a new tariff into effect with the least possible displacement and loss.

A new law reducing the tariff should, he holds, not only be passed, but should be made to take effect immediately, and for this reason: "The business world has known for a year that the tariff was to be revised and substantially reduced. Just what shape the revision would eventually take has not been known. There is warrant for the inference that raw materials will be made free of duty, accompanied by a system of graduated rates on manufactured articles, somewhat in proportion to their advance from the crude condition, due regard being had to the raising of rev

enue.

But we are completely in the dark as to what will be the final form of the new tariff. It is simple justice to the great industries of the country that they should not be kept in suspense. The great majority of manufacturers are not at all afraid of a lower tariff. It will in reality be a great boon to them. But they are extremely impatient to know what it is to be in all its details. Now that financial confidence is fast becoming completely restored, our merchants and manufacturers are ready and desirous to proceed with energy and enterprise to recoup themselves for their losses during the recent crisis. But this they cannot do with intelligence and assurance until the new tariff has been enacted. The revival of business and industrial prosperity, therefore, and the welfare of millions of our countrymen dependent thereupon, to a very great extent now wait upon the action of Congress respecting the tariff."

THE SOUTH FOR A PROTECTIVE TARIFF IN 1896

R. GUY C. SIBLEY, writing in the American

be a difficult matter to enlist the sympathy and votes of the South for a protective tariff. He says that the effect of the financial panic upon the newly developed industries of the South has made her ready and willing to go back and take up the protective tariff where she dropped it in 1856, and declares that if once the federal election law is repealed, and the pension laws are modified and the North will assure and convince the South that they shall remain repealed and modified, the South will be open for a discussion of the tariff. 66 'Why should the South passively adhere to the free trade heresy? She is only at the outer portals of a temple of commercial wealth more substantial in its magnificent proportions than any earthly king has reared. She can manufacture more and produce it cheaper than the older iron and coal States of the North and West. Her coal is inexhaustible, and some of the largest deposits are nearer to tide water than any deposits in the world, except those in England. She is beginning to develop only the outer edge of immense timber forests, and is successfully competing with Canada in the Northern and Western markets. HER INDUSTRIES NEED PROTECTION.

"Her orange crops are increasing every year, and her sugar and rice plantations, under the system of protection, are increasing in area. With such prospects in view, and while she is on the very threshold of prosperity, shall we now turn back, close her iron and coal mines, shut down her factories, cut down her orange groves, relegate her vast timber forests to decay and fire, and leave her sugar cane and rice fields to grow up in weeds? In 1843 Horace Greeley laid down five distinct propositions applicable to the protective system. Those principles are as sound today, in theory, as they were then. Under the practical test of more than thirty years they are simply impregnable. They are especially adapted to the present condition of the Southern States. Mr. Greeley submitted the following: First proposition-'A nation which would be prosperous must prosecute various branches of industry and supply its vital wants mainly by the labor of its own hands.' Second proposition-There is a natural tendency in a comparatively new country to become, and continue, an exporter of grain and other rude staples, and an importer of manufactures.' Third proposition—'It is injurious to the new country thus to continue dependent for its supplies of clothing and manufactured fabrics on the old.' Fourth proposition — That equilibrium between agriculture, manufactures and commerce, which we need, can only be maintained by protective duties.' Fifth proposition- Protection is necessary and proper, to sustain as well as to create a beneficent adjustment of our national industry,'

"Suppose that the South should take unto herself and apply these principles to her present naturally favorable conditions. Under a protective tariff she has it in her power to shut down indefinitely the immense cotton manufacturing plants of Manchester

and Leeds. She has it in her power to bankrupt Fall River and Lowell and Pittsburg, unless they shall bring their manufacturing plants to the inexhaustible iron and coal fields and the almost limitless cotton plantations of the South. Instead of sending her cottoa abroad at seven cents per pound, she can send it in the shape of thread or cotton yarn at fourteen cents, or in the shape of cloth at twenty-eight cents. In thus enhancing the value of her staple product 400 per cent., she not only brings into her borders that much increase in money, but she will have given employment to thousands of laborers, who are taken away from competition in other branches of industry. These are some of the reasons why the South should favor a protective tariff, and will be ripe for its adoption in 1896-and possibly in 1894."

WE

THE TARIFF ACT OF 1789.

HETHER or not the federal government has constitutional power to impose and collect tariff duties except for revenue only, a right denied in the Democratic platform, it is clearly shown by Mr. William Hill, writing in the Journal of Political Economy, that the tariff act of 1789 was imposed with a view of protecting new manufacturing industries as well as to raise revenue for the government. And, more than this, it does not appear from the report furnished by Mr. Hill of the debate upon the measure that any member of Congress, at the time the bill was under consideration, questioned the authority of the government to levy taxes high enough to give any desired protection, or even to prohibit importations for the same purpose. The tariff of 1789 has generally been regarded as a revenue measure, and its low rates have been urged as a proof of its unprotective character, but Mr. Hill finds from an investigation of the subject three points of proof that the encouragement and protection of American manufacturers was at least as important as any other motive in securing the passage of the act which laid the foundation of the tariff system.

A PROTECTIVE AS WELL AS REVENUE MEASURE.

In the first place, Mr. Hill shows that the protective acts of the States furnished the experience on which the national legislators based their proceedings. Very soon after Congress first met, which was in April, 1789, Madison, recognizing the present need of revenue, offered a resolution calling for the adoption of the impost, which, from 1783 to 1789, Congress had in vain urged upon the States. Madison stated distinctly that the object of the measure was to raise revenue, that it was to be a temporary expedient, to remain in force only until a comprehensive system could be arranged. The act he proposed had been discussed in each State, and the opinions of the members as to its merits were already formed. As a substitute for the plan offered by Madison, Fitzsimmons, of Pennsylvania, proposed a system of protection similar to that which had been tried in his State. Both these plans were fully discussed, and after due deliberation the protective duties proposed by Fitzsimmons were preferred to the revenue duties advocated by Madison.

"Fortunately," says Mr. Hill," the evidence did not stop with the choice between the two measures. The Congress of that day did not merely decide upon the principles of a measure and then instruct a committee to prepare a bill in accordance with those principles, at least not on a question of first magnitude. Having determined that a protective tariff was necessary, the whole House proceeded to consider the details of such a measure. Of course the vast amount of business which comes before Congress in these latter days does not permit the full and free discussion which it was then possible to give to each important question. A tariff bill, with its numerous details-with the necessity of adjusting rates to suit the needs of great industries-can be prepared more advantageously by a committee of experts than by a body so large and unwieldy as the United States Congress has grown to be. If, however, Congress could again become a deliberative body, and if the reasons for supporting or opposing the details of a tariff bill could be given as freely as were the reasons for laying protective duties on the few articles which were deemed worthy of protection in 1789, there would certainly be less room for charges that contributions to a campaign fund secure or maintain protection. It may be necessary to buy protection now. It certainly was not a century ago. Then the existence, or the possible existence, of any industry was deemed sufficient reason for the encouragement which was openly and avowedly given. Each industry which had been started in any State, and which gave the least promise of success, was championed by the members from that State. At times they argued that the whole Union would gain by whatever benefited a part; again, that it was necessary to render the nation independent of foreigners, even at some present sacrifice; or again, that what was lost to any section by consenting to duties on one article should be made up to it by protection to its own products."

NOT REGARDED AS UNCONSTITUTIONAL.

Mr. Hill states that the advocates of Madison's plan urged every other reason against its adoption, but never once did they say that protection to American industries would be unconstitutional or even undesirable. All through the reports of the debate presented by him is seen the desire on the part of the legislators of the first Congress to free American industries from the virtual monopoly England at that time held over the manufacture of products consumed in America, and the development by duties on imports of domestic resources.

"Whether," concludes Mr. Hill, "the United States would have been a stronger rival of England if the industrial development which was well begun in 1790 had not been interrupted, is a purely speculative question. What the history of the time does indicate is that industrial conditions are more effective in securing laws than laws are in changing industrial conditions. The state of American commerce and manufactures from 1784 to 1790 certainly called for restrictive and protective legislation and secured it. But with a change of conditions the protective features of the tariff were not strengthened.