There were others that complained in the same way that the higher cost of materials cut them off from a foreign market. Colonel Albert A. Pope, the great bicycle manufacturer of the day, said that he was shut out of South America by English makers. He could offset the extra wage cost here by his more efficient machinery and methods, but his materials were so much dearer that he could not compete. A manufacturer of neckwear and trimmings complained that he could not sell his goods in foreign markets because his imported materials cost too much. The carriage-builders claimed that previous to the Morrill tariff they had a market in Cuba and South America, but they had been run out entirely by France, who could put goods there at half the American price. The oil cloth manufacturer pleaded for free trade. “If you give us free trade, we can send goods to any part of the world and do an enormous business.”
Consumers of copper complained that they paid, in 1875, 23 cents in New York for copper which cost 18 in London; in 1879, 17.5 for what cost 12.2 in London; in 1880, 20 for what cost 13.5 in London. Indeed, importers and manufacturers had at times been able to buy American copper in London so much cheaper than at home that it had paid them to buy it there and send it here. (It came in duty-free if proved to be an American product.)
Nor were the high protectionists even in steel and iron without opposition from men who, like them, profited from the growth of iron and steel industries. Mr. Abram S. Hewitt of New York, for instance, declared that from his point of view the duties were altogether too high, profits unfairly large. In speaking of steel profits he said: “I have never known any such profits in connection with anything with which I have had anything to do;” a statement which confirmed everything which could be learned about the carefully concealed profits of that industry—for instance, not long before this in a law-suit involving the estate of J. Edgar Thompson, the fact had been brought out that he had received as high as 77 per cent per annum as dividends on his steel holdings.
A sinister phase of the testimony was the recurrence of the word monopoly. The theory of Mr. Kelley and his kind had been, of course, that when in consequence of high protection the manufacturing of an article became profitable, capital rushed in to take advantage, and such competition resulted that prices eventually fell lower than they were abroad. But it was not working that way. In the steel and iron business, for instance, as soon as prices began to go down from interior competition a combination to keep them up resulted. It was even shown in the hearings that in 1878 the Vulcan Works of St. Louis had been paid to shut down.
It was October when the commission terminated its public hearings and settled down to prepare its reports. The scrappiness of the testimony, the evident absorption of the majority of the witnesses in their own interests and not those of the country, the little attention given to commerce and the consumer, the failure to get anything like exact statistics, created the impression that nothing important would result. A bad impression was made on the public, too, by the flock of individuals which everywhere hovered around the commission apparently to say to it privately what they did not care to say on the witness stand. These persons beset the members as they dined, walked, rode across country in their special train. They invited them to dinner and to the theatres—a horde of hungry duty-hunters who did more to demonstrate to the fair-minded members of the commission the peculiar evils inherent in any protective system than reams of the ablest theoretical teaching could have done.
The report was submitted to Congress in December, and its publication was a surprise all around. It was far more intelligent, far-reaching, and disinterested than a cynical public had expected. Poor Mr. Henry Carey Baird, the quinine-makers, the whole band of duty-grabbers, were in dismay. They had been betrayed, they said, and it was young Mr. Porter who had done it. He was an Englishman. It was evident he was an emissary of British free traders, sent over by them as a boy to be educated for the task of undermining American prosperity.
No tariff reformer indeed could have asked a better platform than that on which the Commissioners claimed they had worked. Early in their deliberations, they said, they had come to the conclusion that a substantial reduction was demanded—that it was necessary for general industrial prosperity. “No rates of defensive duties,” declared the commission, “except for the establishment of new industries which more than equalize the conditions of labor and capital with those of foreign competitors, can be justified. Excessive duties, or those above such standard of equalization, are positively injurious to the interest which they are supposed to benefit.” They encourage “rash and unskilled speculation” to go into business, they “discredit our whole national economic system,” they cause “uncertainty,” destroy the “sense of stability required for extended undertakings.” No such “extraordinary stimulus” as the war taxes gave was now necessary. The great improvements in machinery and processes made in twenty years “would permit our manufacturers to compete with their foreign rivals under a substantial reduction of existing duties.” Twenty per cent was the general reduction which they had decided manufacturing could support, and they estimated that the changes they proposed would produce a reduction of fully 25 per cent.
When one came to examine in detail the schedules proposed by the commission, it was apparent that, however good their platform, they had by no means lived up to it. The changes were marked by many inconsistencies. The duty on chemicals was cut down with rigor, and quinine was left on the free list, but the duty on crockery and glass was raised without presenting any satisfactory proof that the conditions of labor and capital required an advance. The duty on steel rails was dropped from $28.00 to $18.00—which was still prohibitive—and raised on steel blooms. The copper duty was reduced 20 per cent; nickel 16⅔ per cent; pig iron 4 per cent. The duty on iron rods, cotton-ties, and many manufactures of iron were raised 50 and more per cent.
The singular inconsistencies apart, however, there was enough of what was practical, sound, and helpful in the report to make it an admirable basis to work on. The most serious question seemed to be whether those who had created the commission would stand by its findings. Would the Industrial League consent to a 25 per cent reduction? Would the horde of individuals who had beset the commission during its labors keep their hands off? Would Congress accept and act upon it in the same spirit and with the same intelligence as had been bestowed on its preparation? That it intended to act upon it was obvious. The report was immediately referred to the proper committees in both House and Senate, with orders to prepare bills. Haste was necessary. The last election had gone against the Republicans, the House after March 4th would be Democratic. If the tariff was to be revised by its friends, they must act quickly.