703. Change in tariff policy since the Civil War.—The growth of American manufactures, to which I have alluded frequently in preceding sections, has often been explained by the change in tariff policy which came at the time of the Civil War. The reader must look in other books for a discussion of that question, on which opinions differ so widely. I shall attempt here merely a brief summary of our recent tariff history.
At the outbreak of the war a tariff with moderate protective duties was in force. The strain of the conflict forced the government at Washington to adopt every available means of raising revenue. Heavy taxes were laid on manufacturers and other producers in the country, and the tariff was raised, to secure increased revenue from the importers and consumers of foreign wares. Such an increase was necessary, not only to raise revenue but also to enable the American manufacturers to hold their own in the home market, in spite of the taxes which they paid. Actually, however, the increase was greater than was necessary for these purposes, and by the act of 1864 the average rate on dutiable commodities had risen to nearly 50 per cent.
704. Increase in protective duties.—The high duties of the war period were imposed with the idea that they should be repealed when the war was over and the country had returned to normal business conditions. At the return of peace, however, when the internal taxes on manufactures were repealed, and the peculiar conditions which had formed the occasion for the high tariff no longer existed, the protective duties were kept unchanged or were actually raised. The people in general did not pay so much attention to the tariff as to other questions of politics, and did not realize that it was a tax on them as consumers; while the manufacturers vigorously opposed any reduction. Duties which had been raised by 10 per cent to 30 per cent during the war were kept at the higher level which they had reached, and duties on some special articles were arranged so that they furnished the unprecedented protection of 100 per cent or even 150 per cent. The duty on steel rails, for example, amounted to more than the cost of the product which England was ready to sell us, and Americans who built railroads about 1880 had to pay $61 to $67 per ton for rails which could have been purchased in England for $31 to $36.
705. The tariff at the close of the century.—After 1880 a reduction of the tariff was seriously urged by various individuals and parties in the country. The tariff was changed in details, but the general tendency was rather toward increase than reduction of the protective duties. At the close of the century the average duty was not far from 50 per cent of the value of the goods. The British Board of Trade estimated that the important wares imported into this country from England paid about 70 per cent. Such a high tariff was unheard of in earlier times, in the United States or in Europe; and was exceeded in 1900 only by the tariff of Russia. The Payne-Aldrich act of 1909, the first general revision of the tariff that had taken place for twelve years, amended some details but left its general character unchanged; the Underwood act of 1913 went further, and is credited by a competent authority with making the greatest change in the tariff system since the Civil War. It made considerable reductions on some items, but left rates as high as before on about half of the chief dutiable commodities imported. Before the effect of this last measure could fairly be judged the outbreak of the war in Europe set loose forces which changed the currents of the world’s trade with little regard to the policies of lawmakers.
706. Leading ports, 1860-1914.—The continued importance of the eastern seaboard, in the foreign trade of the country, is shown by the fact that in 1913 nearly two-thirds (64 per cent) of the total commerce in merchandise passed through the Atlantic ports. It should however be noted that these ports were declining in relative importance; in 1900 they enjoyed nearly three quarters (73 per cent) of the whole. Next in rank were the ports of the Gulf of Mexico (1913, 15 per cent), and the customs houses on the northern frontier, (12 per cent); commerce by the southern and northern gateways was growing more rapidly than the old established trade by the Atlantic. In comparison the trade of the Pacific Coast (6 per cent) was unimportant.
The port of New York still stood without a rival in importance. Over one half of the total imports was received through its harbor, and though its share of exports was smaller, it conducted nearly half (46 per cent) of the total trade of the country. No other port had as much as 10 per cent. New York stood even higher, however, in the middle of the period (56 per cent in 1882), and the tendency of recent years had been to distribute among other ports an increasing share of our great foreign trade. The concentration of traffic at the New York gateway had apparently led to congestion, entailing heavy charges and delays, and encouraging the use of transportation lines to other ports whose facilities were not so thoroughly exploited. There have been many changes in the relative standing of the individual ports; the order of their importance in 1913 was as follows, the figures giving the percentage of the total commerce of the country (values of merchandise imports and exports) passing through each: Galveston, 7; New Orleans, 6; Boston, 5; Philadelphia, 4; Baltimore, San Francisco, and Puget Sound, 3 each. The Gulf ports owed their position mainly to their export trade, in which cotton was the leading item; the secondary ports on the Atlantic seaboard had a more diversified traffic, by which the pressure on the port of New York was somewhat relieved.
707. Direction of commerce abroad.—The changes in the distribution of our foreign trade from 1860 to 1913 are apparent in the following table, which gives the percentage, in round numbers, of the total exports and imports of the United States in its commerce with the great divisions of the world. For convenience of comparison the figures for 1800 are included:
| Imports of U.S. from — | Exports of U.S. to — | |||||
|---|---|---|---|---|---|---|
| 1800 | 1860 | 1913 | 1800 | 1860 | 1913 | |
| Europe | 51 | 60 | 49 | 58 | 78 | 60 |
| North America | 35 | 21 | 20 | 38 | 13 | 25 |
| South America | — | 10 | 12 | — | 4 | 6 |
| Asia | 13 | 7 | 15 | 2 | 3 | 5 |
| Oceania | — | 1 | 2 | — | 1 | 3 |
| Africa | 1 | 1 | 1 | 2 | 1 | 1 |
708. Relative commercial importance of different parts of the world.—The figures bring out in a striking manner the close connection of commerce and civilization. The continent of Europe, in spite of its small area and in spite of its inferiority to Asia in population, contributed far more than half of our commerce throughout the century. The proportion of our trade with Europe grew during the first part of the century, to decline again during the latter part, leaving the figures for 1913 very nearly equal to those of 1800. The percentage share of imports from Europe reached its peak before the Civil War (1850, 70 per cent); the greatest concentration of exports in the direction of Europe came later (1880, 86 per cent). Even in 1913 the trade with Europe exceeded in importance that with all other parts of the world together.
The commerce with our immediate neighbors in North America shrank in importance in the first half of the nineteenth century, when the countries of this continent were rivals in the export of raw materials to Europe, but showed a recovery in more recent years, when the diversification of industries in the United States encouraged exports from this country of a kind that had formerly been obtained from the Old World. In comparison with these two most important parts of our trade the remaining branches showed a gain, but one which was in absolute figures so small that it gave no reason to expect any sweeping change in the direction of our commercial interests. In the markets of South America and Asia we appeared still as buyers rather than sellers, importing from those continents special foodstuffs and raw materials for industry, but exporting to them a relatively small share of our own products. Trade with Oceania and Africa had grown, with the growth of a civilized population in those parts, but remained still only a small fraction of our aggregate commerce.