THE NEW YORK CUSTOM HOUSE.
BY COLEMAN E. BISHOP.
One day I said to the Factotum of the Collector of Customs in New York, “I must do up the Custom House in a magazine article of three thousand five hundred words; how much time shall I need to give to the collection of data here?”
Factotum smiled compassionately on me and said: “About three months!”
In this granite building on Wall Street, with its tall Ionic columns, is transacted a business greater than all the industries of the United States combined half a hundred years ago. The merchandise that was inspected, weighed, counted, measured, valued, catalogued here last year was valued at—count the figures!—$857,430,637. The catalogue includes over three thousand articles, many of which you never heard of and would not even recognize the names thereof. Each of these articles has its particular rate of duty, some having two or three different ones. These have to be calculated specifically on every package by quantity, or if the duty be ad valorem, the value of the article has to be first determined and the duty then calculated on the quantity of goods of that class. These estimates and adjustments form the most intricate and delicate business known to civilization. We sometimes think things are plain and easy to administer upon, but the whole range of metaphysics and abstract thought is not more perplexing and doubtful than this mere business matter of levying and collecting the duties on goods passing the custom house.
I remember of hearing a debate in the Senate of the United States upon a proposed amendment to the tariff laws. The bill had been prepared and revised in a committee of Senators most experienced and acute in such matters, and it had been hammered over in long days of debate. Some one now asked what would be the exact duty collectible under this bill on the class of merchandise to which it related, and not a man in the Senate could tell. Last winter, when it was proposed in the House of Representatives to cut down the duties twenty per cent. all around (“horizontal reduction”), it was demonstrated by experts that the measure would work such confusion that it could not be executed.
To illustrate the nicety and intricacies that have grown around this business, take fabrics. The duty on silk goods and that on cotton goods are different. In the case of mixed, silk and cotton, it is, of course, different still. Then, whether the goods be silk or cotton, or mixed, the duty is calculated by a double standard—so much per square yard, and so much according to its fineness and weight. They count the threads of warp and woof in a square inch, and charge duty accordingly. If there are two hundred threads to the inch the fabric must pay a duty of, say, thirty-five per cent. ad valorem, if it cost over twenty-five cents per yard; while on another piece counting two hundred and one threads to the inch the duty shall be six and a half cents per square yard and fifteen per cent. of its cost. A single thread more or less may change the duty. Then there is all the complication of fixing the value of goods. I don’t suppose there is a farmer in the United States who can ascertain by any amount of figuring what it costs him to raise a pound of wool; yet the customs officers must fix the cost for all wool that is imported. So of all other products on which ad valorem duty is levied. Congress two years ago made a change in the basis of valuation, by decreeing that the value of the package in which goods are imported, the fees of brokers and other middlemen in the country where the goods were bought, and the cost of transporting them from points inland abroad to the seaboard, should not be counted in the value of the goods. All these items had before to be included in the appraisement. The fine distinctions and the contested points in fixing duties are innumerable. If any of them seem absurd and needlessly exact, you must remember that every one of them has been fought over between government and importers, between foreign and American dealers, and between rival importers, and has been established by experience as the best adjustment of all conflicting interests. For the tariff system is the growth of centuries. We inherited its leading features from England’s protective system—what time that, instead of free trade, was her better policy—and have gradually modified and expanded it to suit the exigencies of our own national growth. Each item in it is the record of more than fiscal economy. It measures the government’s efforts, as well to defeat the devices of smugglers and the designs of foreign producers as to raise its own revenues. “As the laws of nations are the crystallizations of its historical experiences, so the customs regulations of a people are the residual crystallization of its commercial relations with foreigners, its efforts at industrial development and self-preservation, and its bitter acquaintance with greed, guile and guilt.”[B]
The country’s acquaintance with greed, guile and guilt does not stop at such manifestations of human nature in those who seek to evade the payment of duties, either. It has to protect itself at the same time against the dishonesty and incapacity of its own servants. The customs system is therefore one of checks and balances to secure (1) the impartial and rigorous collection of all duties; (2) the prevention of mistakes in accounts; (3) the prevention of frauds and peculations, both inside and outside the custom houses. To secure all these the system of book-keeping and business detail is grown wonderfully complex and ingenious. The work is divided into three departments, or bureaus, each under the head of its official, all separate and distinct from one another, all under the jurisdiction of the Collector of Customs, and yet each official having his prerogatives and duties which the Collector can not interfere with. Each department revises the work of the others and tests accuracy and fidelity therein.
The Collector’s duties are to see that all the departments do theirs.
The Surveyor of the Port has charge of all outside matters. He is the eye of the Custom House. He is its right hand, which is laid upon a vessel, its passengers and cargo as soon as they enter the Narrows, and never taken off until all dues and requirements of the government are paid and fulfilled.
The Appraiser is to inspect, value, and catalogue all merchandise, and apportion the duties thereon.
The Naval Officer is to revise the work of all the others, and correct errors and neglects, but he has nothing to do with the machinery of collection.
To insure greater correctness there is a reviser of the revisers, who about a year after the clearance of a cargo takes all the papers connected with it, computes, compares and checks them off, and ascertains what has become of all the goods invoiced.
One would suppose that after a ship and its invoices had run the gauntlet of all these lynx-eyed officials, and the accounts had been cast in half a dozen different ways, and the whole affair probed, and pried open, and pried into, and taken to pieces and put together again in different ways, errors and frauds would be impossible. Importers evidently have not such faith in the perfection and inevitableness of the system, for appeals from the demands of the custom house are frequent, and upward of five hundred suits in a year are brought in court against the collector.
The best way to get a slight comprehension of the way this labyrinthine business is done is to go through it once, in fancy. Say you are a merchant traveling in Europe, and keeping an eye on the main chance by buying a stock of silks, woolens, and fancy goods; also dresses, gloves, and “knick-knacks,” for gifts. When the former are ready to be shipped you have three invoices made and presented to the United States Consul of the port of shipment, for him to revise and approve as correct descriptions of the goods. One of these invoices he keeps, one he mails to the Collector of Customs at New York, and one he gives the owner or consignee of the goods. If on opening the consignment in New York the inspector find this invoice does not correspond with the goods, it must be returned to the consul for correction. Thus early in the transaction do the safeguards begin.
Arrived in port, the vessel is boarded by inspectors who take from the master the ship’s manifest and the other papers, and seal up the hatchways, one remaining in charge of the ship while another takes duplicates of the papers to the collector. The master of the vessel also proceeds to the custom house and submits his papers, which convey a complete history and description of his vessel, its voyage, passengers, crew, cargo, stores, etc., etc. There are in some cases port dues and other charges against the vessel for him to pay. His statement includes a schedule of the number, nature, contents, consignees’ names and residences, and markings and numbers of your packages of goods, and of all others in the cargo. All this he vouches for under oath. Thus, to begin with, the government has three accounts of the cargo. The master is then given a permit to land his cargo, still under surveillance of the inspector.
The cargo while being discharged on the wharf is checked off by the manifest, so as to determine whether the cargo apparently corresponds with the representations of the master and his papers. The cargo being landed, the interests of yourself and other consignees become active. You go to the custom house in person, or by a broker, present the bill of lading and the invoices of your goods, certified by the consul; and you state under oath that you have certain merchandise in the cargo as set forth in the invoices, with the marks of the packages and description of their contents. This is called an entry of the goods. If approved, the papers are stamped, dated and numbered, and the value of the goods and the rate of duty are indorsed on the back of your invoice by the entry clerk. He then issues to you a permit to take away such of the goods as you choose, upon payment of the estimated duties thereon, and after compliance with the further conditions described below. If you choose to leave any of the goods for a season in government warehouses, you need not pay the duties thereon, but may give bonds for payment to be made whenever you do take them. This is a bonded warehouse, and when you take the goods it is called “taking them out of bond.” Often goods intended for re-export are left in bond until sent out of the country, and no duty is ever paid on such.
The correctness of these preliminary steps having been reviewed and vouched for by the naval officer, certain portions of the goods, about ten per cent., are sent to the appraiser’s office, as samples from which the value of the whole consignment may be appraised. Before the appraisal is made, however, you must go to the cashier’s office and pay the estimated duty on the goods wanted immediately, on their apparent value as shown in the invoice; you must also give what is called a “return bond” that you will not open the goods until ten days after the appraiser has passed upon the samples, and that you will return the goods to the custody of the collector if required during that time; this enables the government to keep its hold on the goods until the final adjustment of its claims. You now get your permit indorsed by the deputy collector and the naval officer, and take it to the inspector in charge of the vessel.
All your other papers are sent to the appraiser, with the sample goods. His examiner identifies the one by the other and he makes his estimates—a difficult and delicate task, sometimes. The changes from the invoices, either in the quantity or value of goods are noted, and the papers are returned to the collector’s office, where the work of the appraiser as to classification of goods and proper duties, to be paid is carefully revised. If the appraiser’s work be disapproved it is returned to him for correction. After he has amended it, it goes to the naval office, where the whole work is again revised. Then it goes finally to the Bureau of Liquidation, where if you have already paid the right duty you can get a permit to take your goods; if there is more to pay you pay it; if you have paid too much the amount of the overcharge is returned to you. If you be not satisfied with the valuation or any other feature of the adjustment you can appeal, within a certain time, to the Secretary of the Treasury, and if he sustain the collector you can still further appeal to the United States Court. Or if the valuation do not satisfy you, you can ask for a re-appraisement, or demand to have the goods valued by a disinterested outsider expert in such goods. Before him you can call expert witnesses and make as good a case as possible.
If you find any of your goods have been damaged in the voyage—say by bilge water or breakage—you can demand a reduction of the valuation (and hence of the duty) in consequence.
You have now done with the custom house, but it has not done with your papers. They are all gone over again in another way, so as to verify them; and then all the data are tabulated in such a way as to again prove the accuracy of the processes. There is another review of them before the much-tested documents are finally laid to rest. And as before noted, the whole account of the cargo is re-examined a year later.
With the kid gloves and finery in your trunk you will have less red-tape trouble. Inspectors from a revenue cutter have boarded the ship down the Bay, and taken a sworn statement from every passenger as to the number of pieces of baggage he has, and whether or no he has any dutiable goods therein. You may not know whether your goods are dutiable or not, and what is of more importance to you, you may not know that some things which are strictly dutiable in law and would have to pay if put through the custom house in an invoice, can pass free in your baggage. You shall see how and why this liberality of the government is exercised.
Now you and your baggage are taken off the steamer and transported on barges to the barge office at the Battery. Here the scene is as animated, if not as picturesque, as at Castle Garden, described in the October Chautauquan. A large rotunda is piled with long tiers of trunks, boxes and parcels, each ranged under a placard bearing the letter which is the initial of the owner’s name—so that it is easy for you to find yours, unless you are as uncertain as to the orthography of your name as Tony Weller was. A blue-clad, brass-badged inspector, holding your sworn statement in his hand, demands the keys to your trunks. The manner in which you comply will have much to do with the rigor of his investigation, as will your general appearance and make-up. These officials become as good judges of character by externals as do railroad conductors. One of the latter once said to me: “I can pick out all the fresh passengers in a coach as soon as I open the door, by the way they sit, look, and breathe. If they try to deceive, their faces will betray them; they look too unconcerned and innocent. If they feign sleep they overdo it; their attitudes betray them.” So an inspector here says that people’s words, movements, dress, all tell of them.
I can tell the incoming traveler an open secret. Uncle Sam is extremely liberal in the matter of baggage inspection. You would be surprised, sir or madam, at the things the inspector don’t see, if you simply throw yourself on the government’s generosity and act as if you expected to be liberally dealt with. You have only to remember that your foot is on your native heath, and you are an American citizen, one of the sovereigns. An inspector said: “This property is personal effects, and public sentiment is very sensitive as to domiciliary inspection and invasion of private sanctity. The inspector is given wide latitude of judgment; he must have it. By law, every pair of kid gloves that has not been worn is dutiable, but we began to allow a lady a few extra pairs, and finally the limit was set at a dozen. Although that is liberal, we find that plenty of ladies have more pairs in use; and if her appearance, dress, and the other contents of the trunks justify it, we pass as many as we fancy a lady in her station might possess. So of dresses, laces, fans, fancy articles, et cetera. Even piece goods not cut or sewed are under certain conditions ignored, if the owner declares they are for her own necessary use. So of cigars. Our rule is to pass a hundred duty free; but we don’t always stop to count them, if the passenger looks like a man of means and character. What would the seizure amount to if there were ten or twenty, or even fifty over the arbitrary limit we have fixed? The government does not do such ‘picayune business.’”
“Does not this leave the door open for smuggling?”
“Not much. A person can not get much through openly in a trunk that can affect the revenues or injure honest importers. The chief thing we need to prevent is passing goods intended for selling. This sort of fraud is usually attempted by deception, and we are pretty sure to detect it, either by the nervousness or appearance of the person, by the looks of the baggage, or by having been forewarned by detectives abroad, on shipboard or here. We get a moiety share of the forfeiture and fine, if we detect such attempts, and this is so large a sum that our interests are mostly with the government.”
We will learn more about smuggling. False bottoms and secret pockets in trunks are an old device for hiding things; but the man who first secreted diamonds in his boot heel originated something. Secreting about the person is the ruse oftenest used, and, women’s costumes affording the best resources for this purpose, women are the most frequent smugglers.
Some of them—reputable women, too—take quite superfluous pains and make themselves look needlessly ridiculous by loading their persons with apparel that no one would question if in their trunks, and no one does on their persons, except to smile at the self-exposure. On a hot July day I saw elegant appearing ladies in the barge office, sweating under enormous fur cloaks that made them look like Arctic explorers. This foible is neatly satirized in “Nothing to Wear,” in which is described the enormously stout appearance of Miss Flora McFlimsy upon landing.
One day the inspector witnessed a woman waddling down the gang plank with the body of a two hundred pounder and the face and head of a skinny, ninety-five pounder. Of course she was invited to the examination room by the female inspector, where the peripatetic ladies’ furnishing store was opened up and duty demanded on the whole outfit. The same things in a trunk would probably have gone through, most of them. Here the open and honest course were the wisest.
Laces, silks, and linens are wound around the body and limbs, or made up into extra and superfluous skirts. Coiffeurs are made to serve as bustles; extra gold watches and jewelry are hung to the inside of skirts, and a dozen other devices are the suggestion of lovely and ingenious woman.
Here, as well as on the Canada frontier, women are found most apt at amateur smuggling. The reasons for this are numerous. Women are by education and domestic necessity close buyers and can not usually forego a bargain. The lines of duty, moral or fiscal, are not closely drawn or clearly defined here. Smuggling is a statutory offense, not a moral crime, and from time immemorial injustice and favoritism have been alleged against the whole tariff on imports. You shall hear plenty of good moral men to-day denouncing all tariff as robbery. Besides, what deference for or loyalty to government demands should we expect of women when they are denied all share in government or law-making? Over against these customs peccadilloes we may set the unanimous verdict of business men that in positions of financial trust and responsibility, and as debtors, women are almost universally honest.
The belief is quite common that smuggling through luggage is much practiced by feeing the inspectors. Of course, the inspectors deny this. They point to the superior inducements to fidelity on their part in the share they secure of seizures, forfeitures, and penalties; to the risk they run of detection in accepting bribes, the inspection being done openly with many interested spectators and paid spies about, and to the serious consequences of detection. Moreover, since the courts in the celebrated Astor suit decided that anything may pass which the person would swear is for personal or family use, the necessity for bribery is largely done away. Mr. Astor recovered from government duties upon $40,000 worth of luggage that had been seized.
This story is told: Two years ago a woman landed with as many trunks as a banyan tree; the inspector had been notified that she was a fashionable milliner in New York. She said to the inspector, “I am in great hurry, and if you will put my baggage right through and come up to my store this evening I will give you a five pound note.” The collector scented more than twenty-five dollars for himself in forfeitures, and began the examination. A dozen pairs of new kid gloves, of four different sizes, were the first thing uncovered. The lady protested that they were all for herself, and that she was entitled to a dozen, and they were passed. But when more gloves of different sizes were found, until there were half a gross, she began to raise her bid. Then fifty pairs of new shoes of many different sizes were turned out, and then silks, flowers, ribbons, fans, and finery à la McFlimsy. She at last offered three hundred dollars to have the trunks passed, but as there was about twelve hundred dollars worth of goods on which was a duty to collect of, say, five hundred dollars, all of which (seventeen hundred dollars) was forfeit, it was no use. The business had gone to a point where the owner could not afford to bid against the government for the purchase of the inspector’s honor. The goods were sent to the seizure room, and the woman was sued for the penalty, as it exceeded the value of the property. After two years of obstacles and delay the case was compromised and settled. The inspector told me that his share of the damages would be much more than the three hundred dollars she offered. Honesty is the best policy, virtue is its own reward, and everybody is honest when it pays best, you see. If the woman had not offered the bribe, and thus put it out of the power of the official to show her any leniency, she would have been allowed to take the goods away on payment of simple duty. She at least learned that there is a time and way for all things, including bribery.
[B] Harper’s for June, 1884.