Tuesday, January 14.
Commerce of the United States.
The House again resolved itself into a Committee of the whole House on the Report of the Secretary of State on the privileges and restrictions on the commerce of the United States in foreign countries; when Mr. Madison rose in reply to Mr. Smith, of South Carolina.
Mr. M. began by observing that he had expected, from what was intimated yesterday, the sequel of what was then said against the resolutions before the committee; but, as there was a silence in that quarter, and no other member has risen on either side of the question, he himself would request the attention of the committee.
It had been much pressed that, in the discussion of this subject, it should be viewed in its commercial relations only. He was perfectly willing to meet every objection that could be urged on that ground; but, as he conceived it impossible to do full justice to the interests of the United States without taking some collateral considerations into view, he should be obliged, in the course of his remarks, to point at the political disposition and conduct of some of the nations of Europe towards this country.
The propositions immediately before the committee turned on the question, whether any thing ought to be done at this time, in the way of commercial regulations, towards vindicating and advancing our national interests. Perhaps it might be made a question with some, whether, in any case, legislative regulations of commerce were consistent with its nature and prosperity.
He professed himself to be a friend to the theory which gives to industry a free course, under the impulse of individual interest and the guidance of individual sagacity. He was persuaded that it would be happy for all nations, if the barriers erected by prejudice, by avarice, and by despotism, were broken down, and a free intercourse established among them. Yet to this, as to all other general rules, there might be exceptions; and the rule itself required what did not exist—that it should be general.
To illustrate this observation, he referred to the Navigation Act of Great Britain, which, not being counterbalanced by any similar acts on the part of rival nations, had secured to Great Britain no less than eleven-twelfths of the shipping and seamen employed in her trade. It is stated that, in 1660, when the British act passed, the foreign tonnage was to the British, as one to four; in 1700, less than one to six; in 1725, as one to nineteen; in 1750, as one to twelve; in 1774, nearly the same. At the commencement of the period, the tonnage was but 95,266 tons; at the end of it, 1,136,162.
As another illustration, he mentioned the case where two countries happened to be in such a relation to each other, that the one, by discouraging the manufactures of the other, might not only invigorate its own, but transplant the manufacturers themselves. Here the gain would be a clear one, and the effect evidently consistent with the principle of the theory.
To allow trade to regulate itself is not, therefore, to be admitted as a maxim universally sound. Our own experience has taught us that, in certain cases, it is the same thing with allowing one nation to regulate it for another. Were the United States, in fact, in commercial intercourse with one nation only, and to oppose no restrictions whatever to a system of foreign restrictions, they would, of necessity, be deprived of all share in the carriage, although their vessels might be able to do it cheapest, as well as of the only resources for defence on that side where they must always be most exposed to attack. A small burden only in foreign ports on American vessels, and a perfect equality of foreign vessels with our own in our own ports, would gradually banish the latter altogether.
The subject, as had been remarked on a former occasion, was not a novel one; it was coeval with our political birth, and has at all times exercised the thoughts of reflecting citizens. As early as the year succeeding the peace, the effect of the foreign policy, which began to be felt in our trade and navigation, excited universal attention and inquietude. The first effort thought of was an application of Congress to the States for a grant of power, for a limited time, to regulate our foreign commerce, with a view to control the influence of unfavorable regulations in some cases, and to conciliate an extension of favorable ones in others. From some circumstances then incident to our situation, and particularly from a radical vice in the then political system of the United States, the experiment did not take effect.
The States next endeavored to effect their purpose by separate but concurrent regulations. Massachusetts opened a correspondence with Virginia and other States, in order to bring about the plan. Here, again, the effort was abortive.
Out of this experience grew the measures which terminated in the establishment of a Government competent to the regulation of our commercial interests and the vindication of our commercial rights.
As these were the first objects of the people in the steps taken for establishing the present Government, they were universally expected to be among the first fruits of its operation. In this expectation, the public were disappointed. An attempt was made in different forms, and received the repeated sanction of this branch of the Legislature, but they expired in the Senate—not, indeed, as was alleged, from a dislike to the attempt altogether, but the modifications given to it. It has not appeared, however, that it was ever renewed in a different form in that House, and for some time it has been allowed to sleep in both.
If the reasons which originally prevailed against measures such as those now proposed had weight in them, they can no longer furnish a pretext for opposition.
When the subject was discussed in the first Congress, at New York, it was said that we ought to try the effect of a generous policy towards Great Britain; that we ought to give time for negotiating a treaty of commerce; that we ought to await the close of negotiations for explaining and executing the treaty of peace. We have now waited a term of more than four years. The treaty of peace remains unexecuted on her part, though all pretext for delay has been removed by the steps taken on ours; no treaty of commerce is either in train or in prospect; instead of relaxations in former articles complained of, we suffer new and aggravated violations of our rights.
In the view which he took of the subject, he called the attention of the committee particularly to the subject of navigation, of manufactures, and of the discrimination proposed in the motion between some nations and others.
On the subject of navigation, he observed that we were prohibited by the British laws from carrying to Great Britain the produce of other countries from their ports, or our own produce from the ports of other countries, or the produce of other countries from our own ports, or to send our own produce from our own or other ports in the vessels of other countries. This last restriction was, he observed, felt by the United States at the present moment. It was, indeed, the practice of Great Britain, sometimes to relax her Navigation Act so far, in time of war, as to permit to neutral vessels a circuitous carriage; but, as yet, the act was in full force against the use of them for transporting the produce of the United States.
On the other hand, the laws of the United States allowed Great Britain to bring into their ports any thing she might please, from her own or from other ports, and in her own or in other vessels.
In the trade between the United States and the British West Indies, the vessels of the former were under an absolute prohibition, whilst British vessels in that trade enjoyed all the privileges granted to others, even the most favored nations, in their trade with us. The inequality in this case was the more striking, as it was evident that the West Indies were dependent on the United States for the supplies essential to them, and that the circumstances which secured to the United States this advantage, enabled their vessels to transport the supplies on far better terms than could be done by British vessels.
It might be regarded (he observed) as a general rule, that, where one nation consumed the necessaries of life produced by another, the consuming nation was dependent on the producing one. On the other hand, where the consumption consisted of superfluities, the producing nation was dependent on the consuming one. The United States were in the fortunate situation of enjoying both these advantages over Great Britain. They supply a part of her dominions with the necessaries of life; they consume superfluities which give bread to her people in another part. Great Britain, therefore, is under a double dependence on the commerce of the United States. She depends on them for what she herself consumes; she depends on them for what they consume. In proportion as a nation manufactures luxuries must be its disadvantages in contests of every sort with its customers. The reason is obvious. What is a luxury to the consumer is a necessary to the manufacturer. By changing a fashion or disappointing a fancy only, bread may be taken from the mouths of thousands whose industry is devoted to the gratification of artificial wants. He mentioned the case of a petition from a great body of buckle makers, presented a few years ago to the Prince of Wales, complaining of the use of strings instead of buckles in the shoes, and supplicating his Royal Highness, as giving the law to fashions, to save them from want and misery by discontinuing the new one. It was not (he observed) the Prince who petitioned the manufacturers to continue to make the buckles, but the manufacturers who petitioned their customer to buy them. The relation was similar between the American customers and the British manufacturers; and if a law were to pass for putting a stop to the use of their superfluities, or a stop were otherwise to be put to it, it would quickly be seen from which the distress and supplications would flow. Suppose that Great Britain received from us alone the whole of the necessaries she consumes, and that our market alone took off the luxuries with which she paid for them: here the dependence would be complete, and we might impose whatever terms we please on the exchange. This, to be sure, is not absolutely the case; but, in proportion as it is the case, her dependence is on us. The West Indies, however, are an example of complete dependence. They cannot subsist without our food. They cannot flourish without our lumber and our use of their rum. On the other hand, we depend on them for not a single necessary, and can supply ourselves with their luxuries from other sources. Sugar is the only article about which there was ever a question; and he was authorized to say that there was not, at the most, one-sixth of our consumption supplied from the British islands. In time of war or famine the dependence of the West Indies is felt in all its energy. It is sometimes such as to appeal to our humanity as well as our interest for relief. At this moment the Governor of Jamaica is making proclamation of their distresses. If ever, therefore, there was a case where one country could dictate to another the regulations of trade between them, it is the case of the United States and the British West Indies. And yet the gentleman from South Carolina (Mr. Smith) had considered it as a favor that we were allowed to send our provisions in British bottoms, and in these only, to the West Indies.
Wednesday, January 15.
Commerce of the United States.
A proposition being made to go into a Committee of the Whole on Mr. Madison's resolutions,
The House then went into committee.
Mr. Forrest, after a long pause, observed, that, as no other person appeared disposed to rise on the occasion, although he felt himself unequal to doing that justice to the subject which many others were, yet he considered it his duty to offer a few remarks which had occurred to him in the course of the debate.
In all our discussions of commercial affairs, the principal point to be kept in view was the promotion of the essential and permanent interests of our country, keeping in mind this maxim, (as true in respect to nations as individuals,) that there is no friendship in trade. He then entered into a consideration of our commercial connection with Great Britain, and observed that we should avoid letting our former prejudices, or those arising from recent transactions, influence our judgments. We should not regard the favoring of the French or British nation, but study to do that which would tend to the promotion of our own commerce and the interest of our own navigation. In this pursuit, we must keep in view our relative situation with European nations, particularly those of France and Great Britain, and more particularly the latter, with whom the proposed resolutions contemplate a change. Of all possible times, (said he,) I believe this the most improper to try the experiment.
If the British Government have been instrumental in letting the Algerines loose upon us; if their privateers commit acts of piracy upon our neutral flag, let it at least, in the first instance, be made matter of negotiation. Neutral nations must suffer some inconvenience; and it will be much better policy to come forward at once and say we are at war. We will not submit to vexatious insults, when they are too much to suffer, rather than make this commercial warfare, by which it is impossible, in the course of human events, but that we must be much the greatest sufferers; and how humiliating would it be, after trial, even to propose to make it a drawn battle!
Let us examine the subject. Of the whole fair trade of Great Britain, taking their imports and exports into view, their trade with the United States will be found to be one-sixth, or thereabouts. Take the imports and exports of the United States, and you will find that full one-half the value of our whole trade is with Great Britain and her dependencies. Who will suffer most? She, by the interruption of one-sixth, with the means of getting most of the articles we supply, on as good terms, from other nations, with great internal sources of revenue, and a people used to bear any taxes asked of them; or we, with an interruption of one-half our trade and commerce, not so well off with respect to internal resources, and the complaints of our citizens, not accustomed to heavy taxation? Let those who rely upon the effect it will have on the English manufacturers and artisans, look back to 1773 and 1774, and recollect the effect it then had.
But there is one circumstance that should have weight with every mind. It will be found that three-fourths of all the impost revenue of this country are derived from our commerce with the British. Shall we hazard an entire loss of this revenue? And if lost or greatly interrupted, from whence shall we supply its deficiency, without, at least, in their minds, oppressing the people of this country? I am not a stockholder or a bankholder. I am too poor to be either, and therefore can have no separate interest in view, and, where I am known, I shall not be charged with partiality to Great Britain; but I hope I am free from such unwarrantable prejudices as to lead me into measures to the injury of my country.
I lay it down as a principle not to be controverted, that our intercourse with Great Britain, in a commercial point, (I mean, putting the mode of carriage out of account, and confining it to the importation and exportation, and restrictions and bounties thereon,) is as favorable as we can expect, and, taken in the aggregate, full as favorable as with France, their Navigation Act excepted.
With respect to navigation, I have long thought it ought not to be submitted to; but are we to expect, at a moment like this, acting (as they will certainly believe we shall) under the impulse of resentment, they will waive an atom of their Navigation Act to the result of our resolutions? It is vain. Let us not hazard that which is certain, which the safeguard of experience has proved, for that we know not of.
It has been mentioned as a grievance that our produce is sent to France, Holland, Spain, Portugal, &c., and that our imports are, in a great degree, confined to Great Britain. Our merchants must pay their debts, and surely it is for their interest to sell their articles for the highest price they will bring, and purchase where they can obtain cheapest. Our produce is sent to those countries to pay our debts in Great Britain.
There has been nothing to lead me to a judgment how the blanks are to be filled. If, with such high duties as to prohibit the articles, our chief source of revenue will be wiped off, and the consequence may, nay, must be, direct taxation. If low, it will only exhibit, without gratifying, a resentment, and the consumers of these articles, the yeomanry of this country, will have to pay the tax. If it is said that it is intended to encourage our own factories, let us select those which we can manufacture, and lay prohibitory duties on the foreign articles.
Mr. F. reprobated the idea of suffering partial or merely political motives to influence in the discussion of the subject. Commercial subjects ought to be considered in an independent point of view. He hoped, therefore, that the committee would endeavor to divest themselves of every incidental impression, originating in impulses from particular events, and contemplate the question simply on its own merits.
Mr. Fitzsimons declared that, in the course of this discussion, he had not heard one single argument advanced which, admitting the premises to be true, could persuade him to give his consent to the first of the resolutions. It was possible that he might agree to some of those that followed. He was perfectly convinced that a judicious system of regulations would be of infinite advantage to the maritime interest of America. He was of opinion that the first resolution was by far too indefinite. The substance of the whole arguments advanced on both sides tended only to establish a fact, which was already perfectly well known, that the Governments of Europe act, in regard to the commerce of the United States, just as they think proper. The lesson was a very good one, and he trusted that, with a proper attention to temporary circumstances, this country would improve by it.
Mr. Madison regarded the objection of the gentleman as entirely of a new kind. He had refused his consent to the first of the resolutions, because it was indefinite. But the propositions laid before the House a few days ago with respect to the Algerines were fully as indefinite, and yet the gentleman who spoke last had recommended them. The order of procedings in the present question is perfectly candid and regular, consonant to the practice of the House, and the practice of the gentleman himself.
Mr. Ames wished, that gentlemen, instead of indefinite declamation, would lay their finger on each particular wrong that Britain had done to us. He did not know of any particular advantage that we had derived in our commerce with France. He wished to discountenance a spirit of revenge, and to ascertain on what side the benefits of our commerce lay, and wherein they consisted. He did not like unfair comparisons,
Mr. Nicholas said, that he would not, at this time of day, attempt to detain the House any further than by just observing that the practice of comparisons had originated among the gentlemen who opposed the resolutions.
At this stage, the committee rose, and had leave to sit again.