The Tariff in Our Times

by Ida M. Tarbell

“Sir, for the last twenty years I have been so in the habit of laughing, at least in my sleeve, when hearing gentlemen reproduce that admirable novelty that I could not help doing so when the chairman of my committee startled me by reciting it. I have it before me as uttered by the gentleman, then from Ohio, but who was carpet-bagged to New York, and who is sometimes known by the sobriquet of ‘Sunset,’ as he delivered it in 1864.... It was quoted the other evening by the gentleman from Mississippi.... Subsequently I heard it from my friend, the late James Brooks. Then from our friend, S. S. Marshall, of Illinois, and there has never been a tariff bill under discussion that I have not heard it three or four times; and I repeat I could not help laughing when the chairman of the committee got it off with such solemnity.”

The Wood Bill never got out of the House, but it was not because interest in the tariff was abating. There was a deep unrest in the country on the subject, and it was stirred by a band of tariff-reformers of great ability. It is doubtful, indeed, if we have ever had as able a group of teachers as those who kept up their hammering in the ’80’s, undismayed by the disaster of ’72. To Perry and Wells and Horace White, whom we have already met, should be added two in particular, William G. Sumner and Joseph S. Moore.

Mr. Sumner, who since 1872 had held the chair of history and economics in Yale University, was a young man educated at Geneva, Göttingen, and Oxford. He had begun his career as a clergyman of the Protestant Episcopal Church, but had left it for academic work. A few years ago at a dinner in New York, Mr. Sumner explained how he became interested in the tariff question: “Thirty-five or forty years ago,” he said, “I became a free trader for two great reasons as far as I can now remember. One was because as a student of political economy my whole mind revolted against the notion of magic that is involved in the notion of a protective tariff.... The other reason was because it seemed to me that the protective tariff system nourished erroneous ideas of success in business and produced immoral results in the minds and hopes of the people.”

Mr. Sumner did not add at this time another interesting fact—that he was first aroused to active public efforts against protection by Grant’s suspension of the office of Special Commissioner of Revenue in order to get rid of the reports of David A. Wells. It was a very good illustration of the effect of trying to silence honest speech on a question of public interest. The high protectionists, in ridding themselves of Wells in Congress, turned him into the public forum, where he was immediately reënforced by Mr. Sumner. Two voices were raised where there had been one.

In journalism the most effective writer at this time was the “Parsee Merchant,” Joseph S. Moore. Moore was a clever German-Hebrew, who had come to New York from Bombay and had secured a place in the New York Custom House. He had first attracted attention in 1869 by a series of letters to the New York World, signed “Adhersey Curiosibhoy.” These letters, addressed to “Sahib Greeley,” told of the adventures of a Parsee merchant who came to New York from India to buy goods. His theory in coming, he said, was that as the United States was the land where certain things his firm traded in were raised they ought to be cheaper there; and as the United States bought jute, seeds, gums, etc., from India, he could establish a direct trade instead of the indirect through London. He wanted copper, but copper he found cost five cents more a pound in New York than in London. He wanted cotton prints, but they were 25 per cent dearer here than in England. He wanted enamelled hides, but they cost 25 per cent more than in England. He went to New Haven to buy carriages, but the price was $1100 in currency against 90 guineas in London. He wanted iron; it cost 80 cents more than in England, 60 per cent more than in Bombay. He wanted wood-screws, but the “wood screw sahib” laughed and told him he had a better market at home than any the Parsee could bring him and in it he could sell all he could make at from 70 to 100 per cent more than the foreigner paid. Discouraged, the Parsee wrote a series of over forty letters to “Sahib Greeley,” begging him to reflect and weigh the facts in his “great political economical mind” and explain to him why a policy which produced such prices for the people of America and made trade with foreigners impossible, was not stupid.

So effective was the Parsee that he greatly incensed the Industrial League. The Executive Council declared him to be subsidized by British gold and attributed to him much for which he was in no way responsible; for instance, the Wood Bill, of which Moore really disapproved, they characterized as a “crazy structure contrived by a foreigner who has been so long tolerated in the New York Custom House that he has grown to imagine himself an authority.” The opposition to the Parsee was so strong that Secretary Sherman finally removed him.

The only effective bit of tariff legislation in this period, 1876 to 1882, was due largely to the Parsee Merchant—the removal of the duty on quinine. The wholesale price of this medicine, enormous quantities of which were consumed, particularly in the Middle West, had risen in 1877 and 1878 as high as $4.75 an ounce, the highest point recorded in the history of the business. The Parsee merchant took up the matter in the press. The duty on quinine—40 per cent—was, he declared, “a sickening, disgraceful blood tax.” It was made by only four houses in the United States, all of them manufacturing chemists who were growing enormously rich—which was true. They brought in their bark free, and they were able to make their own price for the product. The press took up the cry. Frightened by the popular indignation, one firm of quinine manufacturers offered Moore $100,000 to withdraw his opposition. Several young Congressmen saw the chance, and in rapid succession ten different bills repealing the duty on quinine were brought into the House. The one brought to vote was introduced by James McKenzie, a young Kentuckian. It went through without debate, a victory which earned for Mr. McKenzie a name by which he is called to-day in Kentucky—“Quinine Jim!”

The Senate was less in a hurry about the quinine bill, for there it met the opposition of Mr. Morrill, who on principle had always fought against legislating a duty off or on a single article without considering those related to it. He pointed out now that the makers of quinine used several articles on which they had to pay duty—fusel-oil, distilled spirits, soda ash, East India bark (if they used that variety, which few of them did). To compel the manufacturers to pay these duties and give them no compensating duty on their product was unfair. But the tide was against him. “Raise a cry of ‘mad dog,’” Mr. Morrill commented, “and the dog is sure to die.” And he did—the bill passed.

As a matter of fact the effect of the removal of the duty was magical. In five years from the date the bill became a law—July, 1879—quinine had fallen from $3.40 per ounce to $1.23, and in ten years, July, 1889, to 35 cents, in 1905 to 21 cents. The quinine manufacturers were thunderstruck. They declared that they were ruined, and very likely they believed so. At all events, they discharged their hands and closed their works. As the country was not moved to tears by the spectacle, they gradually reopened their factories and resumed business, and eventually became more prosperous on a free-trade basis than they had been before. They remain a bright and shining example of the ability of Americans to compete with foreigners in a fair field and without favor in any industry not forbidden by our soil and climate. The quinine bill was the one tariff result the Democrats had to show for the four years they had held the House!

The presidential campaign of 1880 did not change the attitude of the two parties at all on the question. The Democrats repeated their “tariff for revenue only” plank, the Republicans their declaration that “duties levied for the purpose of revenue should discriminate so as to favor American labor.” It is doubtful if either party expected at the time of their conventions that the tariff would cut much of a figure in the campaign. Garfield, from whom if from any Republican of good party standing, sound counsel on the question should be expected, kept suspiciously silent. He knew as well as anybody, since Greeley had long ago told him, that the only objection the dominant faction of the party had against him was that he was not “sufficiently protective.”