TARIFF COMMISSION LEGISLATION.

Doubtful if Anything is Done-The Longworth Bill-Democratic Opposition.

(Correspondence AMERICAN ECONOMIST.) WASHINGTON, D. C., Jan. 12.—Notwithstanding the vigorous efforts that are being made by President Taft and some of his associates, and by some members of Congress and the agitators in convention assembled here during the week, to promote the passage of a "Permanent Tariff Commission" bill, doubt is expressed by the leaders in both Houses whether anything will be accomplished at this session. The reason given for this doubt is the fact that there is nothing like unanimity of opinion among the leaders of either house in regard to the course that should be pursued. There is violent opposition to a general Tariff commission, with such broad powers as are proposed by some people; and, at the same time, there is a hope and expectation among most of the Democratic leaders that the entire scheme will be defeated.

The Longworth Bill.

What is recognized as the administration idea of a permanent Tariff commission is represented in a bill introduced by Representative Longworth, of Ohio. The principal features of this bill are the creation of a commission of five members, which is to be required to make reports to Congress as well as to the President, upon request, and a provision authorizing the subpoenaing of witnesses and calling for persons and papers. While it is remembered that most of the features of the Longworth bill are sharply antagonized by members of Congress who had acquiesced in the plans for the existing Tariff board with limited powers, and the further fact that Chairman Emery of the Tariff board, in his first public discussion of the workings of that institution, took a stand against enlarging the powers of the board, and declared that it is undesirable that drastic means be taken for forcing evidence regarding the cost of production in this country, it is regarded as strange that the Longworth bill goes so far in these respects.

The suggestion is made that a Tariff commission bill in some form, which shall be no more than the continuation of the present Tariff board, with a substantial appropriation, will probably pass the House in some form in the present session. This is by no means certain, and the Ways and Means Committee is certain to have before it a number of plans considerably limiting the scope and action of the board, compared with what the Longworth bill is intended to accomplish. With the division of opinion in the Ways and Means Committee, and

the general hostility of the Democratic minority, as well as of some of the active and influential Republicans in the House, the chances for any legislation are regarded as far from being good.

Small Chance in the Senate.

In the Senate the chances are said to be much less favorable for any action whatever than they are at the House end of the Capitol. While several influential Republican Senators admit that they are willing to give President Taft and his administration anything that is desired with respect to an investigation of Tariff matters, they are inclined to stand firmly upon the proposition that the President, in his annual message to Congress in December, did not go to the extent proposed by the Longworth bill. In fact, he placed himself on record as endorsing the existing Tariff board and asserted that it is in position, when provided with the necessary funds, to make all the inquiries that will be needed to ascertain the facts regarding the workings of the Tariff law. The President expressed himself as satisfied with the personnel of the board, although he made no objection to an increase in the number of members of the board if such action were thought by Congress to be desirable.

One of the most interesting reasons advanced why there shall be no action taken by this Republican Congress in securing what is popularly termed a "permanent Tariff commission," is that the Republican party has been set aside, in the matter of consideration in the immediate future of Tariff legislation. The House of Representatives, in which body revenue bills must originate, has been turned over to a Democratic majority. It was well stated a few days ago, during the course of a debate in the Senate, that the Republican party should leave all matters pertaining to Tariff investigation to the Democratic leaders in the next Congress. Senator Aldrich, chairman of Committee on Finance in the Senate, declared in a discussion of the subject in open Senate, that he did not wish to see anything done that would embarrass the Democrats in any investigation they may seek to make with respect to the Tariff. Mr. Aldrich, in those remarks, recognized the fact that the Democrats were empowered by the country at the recent elections to give whatever consideration shall be given by the House of Representatives to Tariff matters, and he also recognized that the Democrats are altogether unfriendly to anything like. advice from Tariff boards, or other authorities, regarding the cost of production or necessary revenues. The Democrats have ideas with respect to the Tariff so squarely antagonistic to those advocated by the Republican leaders in the present Congress that it would be unfair to establish any authority for investigat

ing Tariff matters for the guidance of a Democratic majority in the coming Congress.

The President's Active Efforts.

It would appear from this situation, and the wide differences of opinion among the Senators and Representatives, as to the course that shall be pursued in the effort to save President Taft's Tariff board, that nothing will be accomplished in the present Congress, because of inability to secure consideration of the subject by the Senate. Apparently there is every disposition on the part of the leaders in the Senate to confine the legislation of the present session to the necessary appropriation bills and a few measures which President Taft has earnestly recommended, and to the time that will be spent in debating these bills. Very little time will be left for settling differences of opinion among the Republican Senators, to say nothing of satisfying the Senators in the Democratic minority regarding even the present Tariff board, to say nothing of a broader proposition, such as is embraced in a proposed permanent Tariff commission

measure.

President Taft continues to be active in urging that the Tariff board shall be given a substantial appropriation at this session. He realizes that with the opposition which the Democrats will make in the next Congress to any appropriation for the board, or any investigation by outside authority of the operations of the Republican Tariff law, that the Tariff board will probably be crippled for want of necessary funds. Reference to this possibility is having considerable effect among some of the Republican members of the House. They are willing to do anything within reason to assist the administration in saving the Tariff board, and continuing the investigations along the lines thus far mapped out, as indicated by Chairman Emery, of the board, in his Chicago speech. This is the reason for the present attitude of several of the Republican leaders in the House, who often have expressed themselves as being radically opposed to Tariff agitation or investigation of the subject by authorities other than the committees of Congress.

Strong Points of Opposition.

Those Republican members of the House, who have reluctantly come to support the Tariff board plan, as advocated by President Taft, are bitterly opposed to the Tariff "Commission" idea, or what they believe to be the unnecessary enlargement of the present board. They also agree with the statement made by Chairman Emery, in his Chicago speech, that it is undesirable to attempt to coerce American producers to give information regarding the cost of production. Mr.

Emery stated that, in his opinion, better results are to be obtained by co-operation with producers who will be ready to give all necessary facts regarding the cost of production, when they are assured that such facts will not be disclosed to competitors.

The Longworth bill is certain to create such opposition, not only in the Ways and Means Committee, but among the Republican leaders in the House, that it is doubtful if the bill can pass in the form it now stands either in the House or in the Senate.

ARTHUR J. Dodge.

The Longworth Bill.

The following is the text of the bill introduced into the House of Representatives by Representative Longworth, of Ohio, to create a permanent Tariff commission:

A commission is hereby created, to be known as the Tariff Commission, which shall be composed of five commissioners, who shall be appainted by the President, by and with the advice and consent of the Senate. The commissioners first appointed under this Act shall continue in office from the date of qualification for the terms of two, three, four, five, and six years, respectively, from and after the first day of July, anno Domini nineteen hundred and eleven, the term of each to be designated by the President; but their successors shall be appointed for terms of six years, except that any person chosen to fill a vacancy shall be appointed only for the unexpired term of the commissioner whom he shall succeed. The President shall designate a member of the commission to be the chairman thereof during the term for which he is appointed. Any commissioner may, after due hearing, be removed by the President for inefficiency, neglect of duty, or malfeasance in office. No member of Congress shall be eligible to appointment as commissioner under this Act. Not more than three of said commissioners shall be members of the same political party. No vacancy in the commission shall impair the right of the remaining commissioners to exercise all the powers of the commission. Each commissioner shall receive a salary of seven thousand five hundred dollars per year. The commission shall have authority to appoint a secretary and fix his compensation, and to appoint and fix the compensation of such other employees as it may find necessary to the proper performance of its duties, which employees, except clerks, stenographers, messengers, and other employees of similar grades, shall be exempt from the operation of the civil service regulations.

SEC. 2. That the principal office of said commission shall be in the city of Washington, in suitable offices, which shall be furnished by the Secretary of the Treasury, and said commission shall have authority to procure all necessary office supplies. The commission, however, shall have full authority, as a body, by one or more of its members, or through its employees, to conduct investigations at any other place or places, either in the United States or foreign countries, as the commission may determine. All the expenses of the commission, including all necessary expenses for transportation incurred by the commissioners or by their employees under their orders, in making any investigations, or upon official business in any other places than in Washington, shall be allowed and paid on the presentation of itemized vouchers therefor, approved by the chairman of the commission. Should said commission require the attendance of any witness, either in Washington or any place not the home of said witness, said witness shall be paid the same fees and mileage that are paid witnesses in the courts of the United States.

SEC. 3. That it shall be the duty of said commission to investigate the cost of production of all articles which by any Act of Congress now in force or hereafter enacted are made the subject of Tariff legislation, with special reference to the prices paid domestic and foreign labor and the prices paid for raw materials, whether domestic or imported, entering into manufactured articles;

the condition of domestic and foreign markets affecting the American products, including detailed information with respect thereto, together with all other facts which, in the judgment of said commission, will be helpful to Congress in providing equitable rates of duty on any article and in aiding the President and other officers of the Government in the administration of the customs laws. SEC. 4. That to enable the President to secure information as to the effect of tariff rates, restrictions, exactions, or any regulations imposed at any time by any foreign country upon the importation into or sale in any such foreign country of any products of the United States, and to assist the President in the application of the maximum and minimum tariffs and other administrative provisions of the customs laws, the commission shall, from time to time, as he shall direct, advise the President as to the state of the commerce of the United States with foreign countries.

SEC. 5. That for the purposes of this Act said commission shall have power to subpoena wit nesses, to take testimony, administer oaths, and to require any person, firm, copartnership, corporation, or association engaged in the production, importation, or distribution of any article under investigation to produce books and papers relating to any matter pertaining to such investigation. In case of failure to comply with the requirements of this section, the commission may report to Congress such failure, specifying the names of such persons, the individual names of such firm or copartnership, and the names of the officers and directors of each such corporation or association so failing, which report shall also specify the article or articles produced, imported, or distributed by such person, firm, copartnership, corporation, or association, and the tariff schedule which applies to such article.

SEC. 6. That in any investigation authorized by this Act the commission may obtain such evidence or information as it may deem advisable, for its confidential use, and in case the evidence or information is so obtained, said commission shall not be required to divulge the names of persons furnishing such evidence or information: Provided, That no evidence or information so secured under the provisions of this section from any person, firm, copartnership, corporation, or association shall be made public in such manner as to be available for the use of any business competitor or rival.

SEC. 7. That said commission shall submit the results of its investigations, together with any explanatory report of the facts so ascertained, to the President or to Congress, at such time or times as the President or Congress shall designate; and at the request of the Ways and Means Committee of the House of Representatives or the Finance Committee of the Senate said commission shall appear before the above-named committees, or either of them.

SEC. 8. That there is hereby appropriated for the fiscal year ending June thirtieth, nineteen hundred and ten, for the purposes of this Act, from any moneys in the Treasury not otherwise appropriated, the sum of two hundred and fifty thousand dollars.

SEC. 9. That all Acts or parts of Acts in conflict with the provisions of this Act are hereby repealed.

Other Things Than the Tariff.

A Chicago man who paid four dollars for a barrel of apples found tucked away among the apples the following note signed and addressed: "Dear ConsumerI received seventy-five cents for this barrel of apples. Will you kindly let me know what you paid for them?" There are evidently other things than the Tariff which contribute to the high cost of living. Clara City (Minn.) Herald.

In all parts of the East where a low Tariff or free lumber was demanded there is an insistent demand that Gifford Pinchot explain why he opposed free lumber. Pinchot would a good deal rather write another attack on Secretary Ballinger than discuss the Tariff question.-Tacoma Ledger.

PERTINENT POINTS.

What the Newspapers Say of the Tariff Situation and Democratic Changes.

A Tariff commission shouldn't have trouble in agreeing that as a local issue the Tariff is a stubborn fact.-Washington Post.

If a permanent Tariff commission can keep its opinions from getting mixed with its statistics it will be a wonder.-Washington Post.

The Tariff board will create a few lucrative positions, hence it may stand a chance of going through Congress.-San Francisco Chronicle.

Senator Young of Iowa would rather speak his convictions than talk for the sake of a possible political future.-Albany Journal.

Revision of the Tariff one schedule at a time may be all right, but-well, the Senators from the wool growing States don't want the wool pulled over their eyes.—Tacoma Ledger.

This question of the Protection of American industry is fundamentally a question of the Protection of American labor.-Wolfeboro (N. H.) State News.

The Democratic position on the Tariff question now is the same as it was twenty years ago. The voters who can remember what happened at that time ought to know what will happen after the Democratic onslaught on the Tariff. -Kingwood (W. Va.) Journal.

No, Not on Woolen Cloth.

The extensive undervaluation frauds by the importers of woolen goods by which the government has been defrauded out of millions of dollars is a good illustration of what is continually taking place where ad valorem rates are laid. This shows exactly what would be the result if the present specific duties on wool were changed to ad valorem duties as advocated by the Carded Wool Association, some of whose members want the specific duties lowered 33 1-3 per cent. in addition. As yet that association has not advocated any reduction in the Tariff on woolen cloth.-Athens (O.) Tribune.

The Truth is.

Notwithstanding the wonderful increase in the purchasing power of every product the farmer sells, many of them have been persuaded to believe that the Republican party has been robbing them through the Tariff. The truth is that farmers can buy more of every article they need today for what they have to sell than ever in history. It is also true that the wage-earner can get more of the substantials in life and live better than ever before.—Independence (Kan.) Trib

une.

Prices in Canada, in Glasgow, in Argentina, Australia and New Zealand.

Editor AMERICAN ECONOMIST:—

The constant cry of the Free-Trader is that the high price of meat in the United States is due to the Tariff; that the duty of 11⁄2 cents per pound on the dressed article, imported, creates and supports the Beef Trust; that the Beef Trust has in consequence the monopoly of supplying our market and can and does charge exorbitant rates; that if it were not for that duty we, the consumers, could get meat from Canada, from the Argentine or from New Zealand at far cheaper rates. There generally comes in another statement, that the Beef Trust sells meat in England at much less prices than we pay in America.

Figures to discredit such talk are not always to be had. If found, they are not always understandable, because of differing money and different ways of selling. How refreshing it is, after a talk with one of these unconvinceable theorists, to run across an unimpeachable authority. The Manitoba Free Press, of Winnipeg, Dec. 21, and Dec. 23, 1910, gives the following prices per hundred at:

tial dreams of the theorists fall.

There is another point to consider, and that is, the retail price of meat. Away up there in Winnipeg, where the farm and the city touch, where the Free Press reporter visiting the market sees forty tons of fresh meat brought in by fourteen sleds to be retailed at New York prices, he rejoices as follows:

This long string of sleighs brings the choicest beef ever offered in Winnipeg. Porterhouse roasts from these fat sides will retail at 25 to 28 cents, while steak will bring 30 cents.

Among the most toothsome dainties are Manitoba yearling lambs, plump and snow white fat, indicating tender meat, almost a sin to eat them; yet the legs will sell at 22 to 25 cents, and chops at 25 cents.

Choice young pork fed on Manitoba barley meal and milk will command 20 to 22 cents per pound for the loin roast and 25 cents for chops.

Young, plump, smooth turkeys have come in by the thousands. Dressed, such birds bring 28 to 30 cents per pound. Frozen turkeys sell at 25 cents per pound.

There, in that far away city, where the United States Protective Tariff has no effect, where meat from all the world can compete for the consumer's money, and where the avaricious grasp of the Beef Trust availeth not, the poor consumer pays the same price for his Christmas dinner as the "Tariff-Beef-Trustridden" consumer in New York.

one

Then comes that other fact to knock out more theory, which is that hour's work in New York will buy at the same price for the purchased article what two hours' work buys in Winnipeg. It may be that meat, in consequence of cheaper rents, cheaper help, and cheaper ways of distributing, is retailed in England at slightly lower prices. Certain it is that the wholesale prices are higher there than here. Equally certain it is that higher wages here give our people the ability to buy.

Daniel Webster said: "Where there is work for the hands there is work for the teeth."

Let us see that we have work for both. EZRA C. WILLIAMS.

"Louisiana Democrats," remarks the Buffalo Express, "probably will elect a high-Tariff, stand-pat United States Senator to protect Louisiana sugar." Of course, no Democrat would be permitted to represent Louisiana in the Senate who believed in the Tariff plank in the Democratic national platform.Rochester Democrat and Chronicle.

Sometimes a Free-Trade expert displays his greatest expertness in avoiding discussion of the subject.-Pueblo (Colo.) Opinion.

There is small doubt that the Democratic leaders are wishing, ardently and sick at heart, that their November victory might have been won under some other banner than that of their low tariff promises. Cleveland Leader.

Results of a Democratic Victory. Recent Democratic success in elections may hinder rather than help the cause of reciprocity with Canada. The interpretation which Canadians put upon the result is that Democratic ascendency will mean a lowering of the Tariff barriers all round, and there are many indications of a disposition on the part of some of the people of the Dominion at least to play a waiting game. A significant utterance which lends color to this assumption is the following from The Quebec Chronicle: "The Democratic platform of Massachusetts declared that if Canada would not grant reciprocity the United States ought to reduce its Tariff. Would it not be best to wait for that day before committing ourselves further?" The Canadians are wise to the fact that Mr. Foss, the Democratic Governor of Massachusetts, during his campaign lost no opportunity of arguing in favor of his hobby, removal or lowering of all duties on Canadian products imported into the United States.

There is no telling what mischief has been wrought by Democratic victory not only to the cause of reciprocity, but in the way of disturbing the general commercial relations between this country and Canada. If Canadians generally get the impression from our elections that the American people are ready to surrender the great markets of the United States without any counterbalancing advantages whatever, and wait for all the concessions to be made on our side, that particular kind of reciprocity will be a long time coming. Yet there is warrant for the Canadian view in the extreme and unjustifiable declarations in Democratic platforms and by Democratic candidates and orators.

Nothing could be much more certain than that the American people will not sacrifice every economic advantage resulting from domestic conditions in order to benefit outsiders.-Troy Times.

High Cost of Living in the Orient.

Secretary James Barton, of the American Board of Commissioners for Foreign Missions, Boston, Mass., is given as authority for the statement that the problem of greatly increased cost of living is as acute in Asia Minor, Armenia, Syria, Macedonia, India, Ceylon, China and Japan as it is in the United States.

The problem has become a serious one with the board in view of its maintenance of some 600 missionaries, 4,500 native preachers, teachers and assistants, and over 70,000 pupils in schools.

Secretary Barton draws the conclusions that the rise of prices in the United States is not due to local conditions alone, since all parts of Asia, Africa and portions of the Pacific are affected alike.American Asiatic.

THEORY OF AMERICAN PROTECTION.

As Translated by an Eminent Englishman Who Thoroughly Believes in That Doctrine.

MORTON FREWEN IN THE NINETEENTH CENTURY.

(Concluded from last week.) Now as to the effect of Protection on prices. There is the striking incident of Musadine, the pearl-button metropolis on the Wisconsin River, created by the stroke of a pen in the McKinley Bill. Pearl shirt-buttons, previously on the free list, had been all imported from Austria. But it was rumored that the raw material -great beds of freshwater mussels-had been discovered in the upper tributaries of the Mississippi. The result of a high tariff on shirt-buttons in the McKinley Bill of 1890 was to bring over to settle within the protected area a Viennese button manufacturer with a capital of £4000 and a few skilled hands. From this small beginning the turnover eighteen years later in the factories on the Wisconsin (1908) was $11,000,000, and the price of shirt-buttons has fallen one-third. In the debate on the Wilson Bill in 1893, Mr. (now Senator) La Follette said:

When La Follette Was a Protectionist. In earthen and glassware the total importation last year was $18,420,634. This is practically all labor. Our people remember that before 1860 we imported all our pottery; that the duty was increased from 20 to 55 per cent.; that American capital was interested and American labor employed; that by 1880 we were manufacturing pottery in every State of the Union except one, and that under the duty of 55 per cent. we reduced the price steadily year by year until the reduction was 40 per cent. below the price we had paid for Crockery under the Tariff for revenue. Our people remember when all the wire rods from which fencing is manufactured were imported from Germany. We imported 150,000 tons a year at a cost of $60 per ton. They remember that we greatly advanced the duty on these rods in the Tariff of 1883; that now, ten years later, we are manufacturing nearly half-a-million tons of these rods, and their price has fallen nearly one-half. From this reduction in the price of the rods our fencing-wire has fallen from ten cents a pound to four cents.

What Would be the World's Prices ?

Or, again, take the case of tinplate. In 1873 tinplate was selling at twelve dollars per box of 108 lbs. Until the McKinley Tariff of 1890 all tin was imported. Two years later, with the high duty, the entire United States production of tinplate was but 590 tons. In 1908 the production was 580,000 tons. What would today be the world's price of tin but for American production through Protection? What, again, would be the world's price of bread if France, a producer of over forty million quarters of wheat because of her high Tariff, were a customer for, instead of a producer of, these forty million quarters?

Take again, the case of men's gloves. Gloves were on the free list in the McKinley Tariff of 1890. The Dingley

Tariff of 1897 imposed a heavy duty, and this is the statement of Mr. Payne, the Chairman of the Committee on Ways and Means, when under the new act of last year he demanded a similar duty on women's gloves also:

Under the McKinley Tariff we were making 5 per cent. of our men's gloves; to-day we are making 90 per cent., and men's gloves are much cheaper than they were when we put the duty on them.3

Wire Nails and Steel Rails. Again, take the instance of wire nails. In 1882 there were made in the United States just 50,000 kegs of wire nails. Their price at that time was 84 cents per lb. and the duty I cent. The McKinley Tariff of 1890 raised the duty to 4 cents. If the amount of duty (4 cents) were added to the price (84 cents) wire nails should have risen to 124 cents, whereas in 1901, eleven years later, the United States production of nails had risen from 50,000 kegs to 9,802,822 kegs. America is now an immense exporter, and the price of the nails has fallen to 21⁄2 cents per lb., or declares Senator Gallinger to "less than one-third of what they cost us when we were dependent upon foreign countries."

When I first visited America in 1878 steel rails were selling at 67 dollars per ton. A duty of 27 dollars was imposed, and steel rails now, one year with another, sell for about the amount of the duty.

But at this rate we shall find it difficult to observe the forest for the trees, and I shall but encumber the mind of any student with great batches of statistics such as these from every schedule from A to P.

Enough to say that the cumulative evidence all points one way-that Protection is the mother of real cheapness; that it raises wages while it reduces prices.

What Bismarck Said in 1879.

What Prince Bismarck, in his speech before the Reichstag on the 2nd of May, 1879, said of Germany is true of America and is true of Great Britain.

One thing is clear, that through the widely open doors of its import trade, the German market has become the mere storage-place for the over-production of other countries. We must, therefore, shut our gates and take care that the German market, which is now being monopolized by foreign wares, shall be reserved for native industry. Countries which are inclosed have become great, and those which have remained open have fallen behind. Were the perils of Protectionism really so great as sometimes painted, France would long ago have been ruined, instead of which she was more prosperous after paying the five milliards than Germany is to-day. And Protectionist Russia, too-look at her marvelous prosperity!

*

is

The question before us is not a political but
a financial one, and we should put all personal
sensibility aside * **Because it is my deliberate
judgment that the prosperity of America
mainly due to its system of Protective laws, I
urge that Germany has now reached that point
where it is necessary to imitate the Tariff sys-
tem of the United States.
* I see that
the Protective countries are prospering, the
Free-Trade countries are decaying.

Congress Record, April 5, 109.
Ibid., May 14, 1909.

Shall the Nation Do Its Own Work?

In short, shall our nation do its own work and devote its wage fund to its citizens, or shall the allied forces of FreeTrade and Socialism be permitted to expel the nation's capital to foreign lands, so that our capitalists may live on the income from their foreign investments, or, if "super-taxed," follow these investments to climes more congenial? Is not the art when established in the homeland, and transmitting an hereditary aptitude to generations of our artificers, more valuable than the mere article imported from a factory in Asia? In short, is the entire conception of free exchange, not merely of free imports, but of that universal reciprocal Free-Trade which still finds its panegyrists, anything but an immoral obsession? These are the questions of the hour. We are at last obliged to read the writing on the wall. Free Exchanges between America, with ninety millions of the most highly paid wage earners, and China with four hundred millions of the very lowest paid and yet the most efficient, would in the end raise Chinese wages twenty-five per cent. by reducing American wages seventy-five per cent. And the social systems of either community must conform to these wage variations, for it is not possible by unrestricted competition to traffic in "cheapness" without making cheap men and cheap women first of all.

Free-Trade's Fearful Work in Great Britain. What wonder that this pernicious experiment in sweating, persisted in by us for now more than half a century, has starved and all but dismembered the Empire-to dismember which was, indeed, Cobden's declared objective has emptied Ireland of her population, and through her bitter unrest has come near to wreck the British Constitution! Well did the great Napoleon declare "the economists are an accursed breed; there is no nation so powerful but they can destroy it."

on

The American Protest Against Protection. In concluding these short notes American Protection-the system whereby wealth is distributed through high wages-I must say a few words in reply to a criticism proper and inevitable. The candid critic will say:

But if Protection is the perfect alternative you declare it to Socialism; if it really reduces prices and gives almost all that is produced to the producer; if American Protection does distribute wealth, and British Free-Trade starves and congests it, and if we have to guide us fifty years of brilliant comprehensive empiricism in both countries, then cadit quæstio, what do we quarrel about? Surely the civilized world must long since have fallen in line?

The answer that practically the civilized world has during the fifty years turned its back on Free-Trade is not adequate. It remains true that within America Protection has silenced Socialism, so that a really brilliant Socialist candidate for the Presidency in 1908 secured but 3

per cent. of the vote. But somewhere deep down in the domain of ethics, and not of economics, it is dimly perceived that Protection is fallible, and that the last word as to equitable distribution has not yet been said. This conviction, however mischievous as a political speculation, is to-day dividing the great deeps to prepare some nouvelle couche sociale. 'Nor is it easy to withhold some measure of sympathy from the new movement. It represents in countless honest hearts The desire

Of the day for the morrow,

so that once more politics in America are at the parting of the ways. Let us, then, examine very briefly the new structure of things, for we are about to hear much of the American protest against Protection.

The Tariff and the Trusts.

In a sense, though not at all in the sense he contemplated, the statement of the late Mr. Havemeyer that "the Tariff is the Mother of Trusts" is true. After so many experiments and object-lessons, high Tariffs and low Tariffs alternating, it does stand out that Protection has im'mensely stimulated the production of wealth in the United States; the result, however, as seen by the unprejudiced witness is in the creation of endless classes of unnecessary middlemen to intervene between the producer and the "ultimate consumer." It has occurred to each half of the nation to "get rich quick" by taking in the washing of the other half. The abuse and the economic waste having become notorious, the pendulum now swings in the other direction. Now the attempt is being made by great trusts to eliminate advertisers and brokers and jobbers and the entire myriad of hawkers and drummers. So that at one remove it is really true that Protection has been the mother of trusts. If these parasitic millions-yes, actual millions-of redundant intermediaries are to be driven out, what is to become of them? They represent an enormous, organized, clamant voice, the press, its advertisement columns in jeopardy, being on their side, and are a very great peril to the modern State.

An Excess of Prosperity.

The trusts have, then, really succeeded in uniting against themselves and the Protectionist proletariat the entire university interest. This represents a class whose profits are and have been colossal, and it is a class which will fight à la lanterne before it goes under at the hands of the trust magnates. In every hamlet in the land this order of society is tod-day preparing to attack the system of Protection which, through an excess of prosperity, has as surely given it birth as a carcass breeds flies. No portion, then, of the work done by the Congressional Committees last year in connection with the new Tariff is more important than the evidence disclosed as to where

to-day American profits are going. As in England, so also in America, the cost of living is rising very fast. No doubt the world-wide rise in prices, as demonstrated by all the "index numbers," is related to the phenomenal supplies of the new gold from the mines. But it is much easier to satisfy the voter that it is due to Protection, and that the Protected manufacturers, the creators of all the trusts, are enriching themselves at the cost of the ultimate consumer.

Tariff and Cost of Living.

Synchronising with the Aldrich Tariff of last year, the cost of living has certainly risen. Free hides were to have reduced the price of boots, but boots are more expensive. Lower duties were imposed on all "raw materials," such as lumber and pig iron, wool, coal, and pulp, and yet the prices of all the articles into the manufacture of which these enter have risen. Tea and coffee, always on the free list, are dearer, as also a score of other necessaries.

The political syllogism of to-day reads: The American Tariff is high; the cost of living in America is rising; therefore the Tariff is accountable. It becomes, then, very important to analyse this cost of living. Mr. Samuel Gompers, the President of the American Federation of Labor, is a man of character and of marked ability. Those who have known him longest have come to regard him as equal to the responsibilities of a very important position. Mr. Gompers has but recently returned from an extended investigation of labor conditions in Europe, and his report is now published in the organ of his association. Mr. Gompers says:

Living is cheap for the wage-earner in Europe only because he does without what in America soon becomes a necessity to him-food in good quantity and quality, presentable clothes, a comfortable home, and a larger, freer life. Meat is usually from 25 to 100 per cent. higher in Europe than in the United States. The immigrant finds that he can buy in quantity his flour, potatoes, fuel, oil, sugar, coffee, salt, all cheaper than in the land he has left. The cheapness and abundance of fruits, and of our melons and tomatoes, are a surprise to him. After the most pressing necessaries come a line of things cheaper than in Europe, such as cotton clothing, jumpers and shoes. Fine woolens and silk stuffs, furs, laces, and kid gloves cost less abroad. If the immigrant who comes to this country is willing to continue living here at the same level he was obliged to accept in his native land, he can find it at the same money.

It Is the Cost of High Living That Hurts. Mr. Gompers, in short, is of the opinion of Mr. James J. Hill. It is less the high cost of living than the cost of high living which to-day confronts the United States. It would, of course, be absurd to deny that prices must be higher in some cases because of the Tariff. That is, indeed, the very purport of the Tariff—namely, by restricting competition to keep prices at a point which permits the Home production to be absorbed through high wages. But the more we analyse prices and the cost of living the more evident it is that the Tariff cuts but little figure; that high

prices in America are the consequent of "boom times," and especially of vast classes of redundant middlemen withdrawn from the producer ranks, who, while producing nothing, perhaps account for one-seventh of the total consumed.

Profit on a Tooth Brush.

In search of data as to the causes underlying the high cost of living, walk with me into the shops of New York. I go to a leading chemist, and I buy an imported French toothbrush for thirty-five centssay, eighteenpence. With a little trouble I find that the importer's price is twopencehalfpenny in Paris, the duty is 40 per cent., or a penny. So that the total cost laid down in New York is just about fourpence. The importer has sold it to the retailer for sixpence, so I pay the final retailer a shilling profit-a profit of 180 per cent. How inconsiderable a part has the Tariff played in this transaction, less than 6 per cent., and yet in all good faith the chemist replies to my expostulation, "You are accustomed to the prices of a Free-Trade country."

Profit on Glassware and Pottery

I will take another instance at random. The manufacturer's cost in glassware and pottery is fully 90 per cent. wages, the cost of the raw material, clay and sand, being quite inconsiderable. So in the American system glassware, being all labor, is protected by a prodigiously high Tariff. Yet the American glass manufacturers have been able to demonstrate to the Senate Committee that their own profits were slightly less than 10 per cent. I buy a large pressed-glass fruit-dish for tenpence. The merchant who retails to me has, I find, bought this glass at the rate of four-and-eightpence per dozen. So he makes a profit of 100 per cent., the protected manufacturer 10 per cent. I next buy a dozen blown-glass "needleetched" champagne-glass for fourteen shillings (3.39 dollars). For these the retailer paid five shillings per dozen; his profit in this case is 180 per cent.

Profit on Chinaware and Jackknives.

A word as to chinaware, the duty on which is 60 per cent. Surely I shall find in this case that the Tariff has increased my cost of living? I go to Haviland & Co. and buy a hundred pieces of imported china from Limoges; the price, 10l. (fifty dollars). The import price, as shown by the invoice, is 21.; add the duty, 60 per cent., to this and the cost is only 31. 4s. And yet this set reaches me, the ultimate consumer, at a price over 200 per cent. higher than the invoiced price with the duty added. Or, again, take Japanese "Blue Point" china cups and saucers. These are valued in the Customs invoices at just twopence, and the duty is 60 per cent. Yet the New York retail price is ninepence a pair. Here the customer pays slightly over a penny of duty on a ninepenny purchase: thus the 60 per cent. duty has increased his out