Treaty after treaty was negotiated, but in spite of urgency from the most respectable sources, Congress refused to act on them, and finally in March, 1901, Mr. Kasson resigned. His chief did not give up the cause, however, for in the memorable Buffalo speech of September 5, 1901, Mr. McKinley said:

“The period of exclusiveness is past. The expansion of our trade and commerce is the pressing problem. Reciprocity treaties are in harmony with the spirit of the times; measures of retaliation are not. If, perchance, some of our tariffs are no longer needed for revenue, or to encourage and protect our industries at home, why should they not be employed to expand and promote our markets abroad?”

The very essence of all this opposition to free or freer exchange on the part of the manufacturers was the fear of lower prices and cheaper goods. They held as a part of their narrow economic philosophy, the theory that the cheap coat makes a cheap man, that prosperity means limited production and high prices. At bottom, the manufacturer eliminates from his calculations all consideration of the consumer. But the consumer exists, and finally, in spite of the enormous prosperity of the country, the consumer was heard from. The Dingley Bill about 1900 began to hit the rocks for which it had from the start been headed.

CHAPTER XI
WHERE EVERY PENNY COUNTS

The last man to be heard from in the making of the Dingley Bill, as indeed of its predecessors, was the man who was to buy the goods. In 1896, when the tariff hearings were going on, Mr. Louis Brandeis of Boston, at that time unknown outside of his own professional circle, appeared “for the consumers” as he told the Committee. He was laughed at for his pains. “What’s the use?” was Mr. Dalzell’s protest; “Oh, let him run down,” his sneer, when Mr. Brandeis insisted that it was his right to say what he thought about duties which made his necessaries dearer. A recurring note in the hearings held in Washington, before the Payne-Aldrich Bill, was contempt for the suggestion that this or that duty made an article cost a cent or two more at retail. What was a cent to a consumer! This was particularly noticeable in the argument of the wool interests. What if the tariff did make the cloth for a suit of clothes a few cents dearer a yard—it did not add a large amount to the price of the cheap suit. It was not worth considering.

What is a cent to a consumer? Are there a considerable number of people in this country living on incomes so small that a rise of a cent or two in the price of necessary articles of food and clothing can make a material difference to them? To most Americans “the poor” in the United States are a negligible quantity. We think of them as the frayed and falling fringe on our great fabric of “comfortable off” population—largely what they are by their own indolence or inefficiency. But is this true? Is it not true, on the contrary, that the great majority of the inhabitants of the country, the great mass of hard-working, industrious men and women are poor? The statistics of the distribution of wealth should be often set before those hopeful souls, who, prosperous themselves, love to insist that, in this country at least, “all is for the best in the best possible of worlds.”

We have 92,000,000 people in the United States. Perhaps there are a few thousand millionnaires among us, perhaps a few hundred thousand having an income of ten thousand dollars or more. But in contrast to them there are millions of individuals whose wage is under a thousand. Look over the average yearly wages in our best-paid industries. Take the one which boasts of paying the highest wage—the United States Steel Trust. According to its last report the average wage of its 195,500 employees, including its foremen and clerks and managers, whose salaries in some cases are $10,000 even $25,000 a year, was but $775. In 1905 the average yearly earnings of the men in the cotton industry was but $416. In 1907 the mule spinners in the Massachusetts woollen factories averaged $13.16 a week, the dyers averaged $8.58, the weavers $11.60. There are probably several millions of white families in the United States whose average wage is not over $500 a year. When one comes to examine industries generally, the surprise is not how much, but how little the great body of wage-earners receive. People must live on small earnings in this country, as everywhere. In order to accumulate enough to provide against sickness and old age they are obliged to practise a thrift which frequently is hateful, it is so cruel. Moreover, genuine thrift requires so much training, intelligence, and self-denial that comparatively few are prepared to practise it, even with the best of intentions. This is the hard fact, and yet the Congress of the United States for fifty years has fixed taxes on the food and clothing and shelter of these people with no apparent consciousness of their condition. They were the “ultimate consumers”—terms in a problem—not suffering, struggling men and women.

If one would know with something like scientific precision what it means for a family to live on $500 or less a year in a city like New York, for instance, if he would realize the relation of a rise of even a cent in the cost of a necessity to the comfort of the multitude of working girls in this country on $6.00 and $8.00 a week, he should study the various investigations recently made into the budgets of these two classes. They demonstrate that if one is to take care of a family of five persons in New York City on $500 a year, or of himself on a wage of $6.00 or $8.00 a week, he must think before he buys a penny newspaper, and he must save and plan for months to get a yearly holiday for the family at Coney Island; that there is practically no possibility of a nest egg or of schooling for the children beyond fourteen years of age, that sickness means debt or charity, and that the accumulation of those things which make for comfort and beauty in a home is out of the question. To these families an increase of a cent in the price of a quart of milk is something like a catastrophe. To these girls, every penny added to the cost of food, of coal, of common articles of clothing, means simply less food, less warmth, less covering, when at the best they never can have enough of any one of these necessaries. These budgets are a powerful demonstration that the rapid rise in the cost of living under the Dingley Bill was to a vast number of people of this country nothing less than a tragedy, for what is true in New York City is equally true in Chicago, in Pittsburg, and in many factory towns. The statistics, which show the rise in prices from 1897 onward, are as sensational as those which show the increase in national wealth. For instance, take what the bulletin of the Labor Bureau calls the “annual per capita cost of the necessaries of daily consumption.” It rose from $74.31 in 1896 to $107.26 in 1906. Coal which cost $3.50 a ton in 1896 cost $4.50 in 1906. Manufactured commodities were 32 per cent higher in 1906 than ten years before, raw commodities, 50 per cent higher. “All commodities” averaged 35.4 per cent higher. Rents soared everywhere. That wages increased largely in many industries in this decade is equally true, but that they increased correspondingly in any but the most favored industries—those where either the Unions exercised compelling power or those where the managers were unusually enlightened—is doubtful. A government investigation of the wages in about 4000 establishments, employing 334,000 persons, engaged in manufacturing and mechanical industries, the kind of establishments where, of course, the forces which raise wages act most freely and successfully, shows that in 1906 the weekly wages of the 334,000 were 19.1 per cent higher than in 1896, while, as said, the cost of all commodities was 35 per cent higher. Wages increased 3.9 per cent in 1906 over 1905, while the cost of the commodities increased 5.9 per cent. Now what does this mean? Why, simply this, that at a time when wealth was rolling up as never before (this country increased its wealth between 1900 and 1904 by about twenty billions of dollars), a vast number of hard-working people in this country were really having a more difficult time making ends meet than they have ever had before. It also means that in a great number of other hard-working families the increase in wages had been so little in excess of the increase in the cost of living that it may be almost said to have been a discouragement instead of a comfort, by intensifying the common conviction of the working-man that no matter how much he earns he will still have to spend it all in the same hard struggle to get on, that there is no such thing for him as getting ahead.

There is no escaping the seriousness of such a situation. The only chance of peace and of permanency in this country lies in securing for the laboring classes an increasing share of increasing wealth. It is not enough that the wages of men keep up with their forced expenditures,—they must go beyond. There must be a growing margin between the two—a margin wide enough for the laborer to see it, and to be able to draw hope and encouragement from it. When the margin has shrunk or not visibly increased, unrest and discouragement must follow. There is no doubt that a great number of employers in this country recognize this principle, and thousands of them are struggling to meet it by increasing wages. But there is another duty for us, and that is to keep down the cost of living. And it is this duty which the makers of tariff bills have always refused to face squarely and, as far as the tariff had any relation to it, honestly to discharge. That the Dingley Bill had not been the only cause of the increasing burden which the consumer bore is true, but it was a real cause, and in the case of certain essential common articles, almost the only cause. Take for illustration the case of the tariff and spool cotton. Spool cotton is as necessary an article of daily consumption in the household as fuel or cloth. Many women with families, on $500 a year, many shop and factory girls on $6.00 or $8.00 a week, make their own clothes. Not infrequently these women in their work are obliged, when not protected by a Union, to furnish their own thread. For many years the price of the ordinary 200–yard spool cotton was 5 cents, twelve spools for 50 cents, when suddenly in 1900 it was advanced to 6 cents, about double the price it was selling for in England. The cause of the advance offers one of the nicest studies we have of the beneficent effects on prices of a tariff combined with a trust.

The leading brand of thread which was sold in 1900 at 6 cents in New York and about half that in England, is made by J. & P. Coats, Limited, of Paisley, Scotland, and by the Coats thread combination in this country. The Coats House is the oldest and most progressive thread house in the world. It early saw the advantage of establishing a factory in the United States and competing for the American trade under the protection of the tariff. Other English firms also saw the advantage, chief among them the Clarke Mile End Spool Cotton Company of Newark, New Jersey. A few years ago the Coatses realized that a combination of the English concerns doing business here would be profitable, and one was brought about, the products of the amalgamation being handled by the Spool Cotton Company of New York City. In 1897 some sixteen of the English competitors of the Coats’s concern combined in a $10,000,000 trust, called the English Sewing Cotton Trust. The J. & P. Coats Company took $1,000,000 of the stock, and at least once since has helped the organization out of trouble by lending it $2,000,000. Thus the two concerns are working together. The next year, after the English combination was formed—1898—an American Thread Trust Company was formed. It was made up of the thirteen leading American concerns,—all, indeed, but one of the large domestic companies went into it. No sooner was this done than the English Trust bought the majority of the American Trust’s stock. Here, then, was an English Trust owning and controlling the American Trust and dictating its policy from the other side of the water. And this British Trust was affiliated and partly owned by the still larger concern, the J. & P. Coats Company. It comes down to this, that the $48,000,000 Coats concern controls practically the thread business of England and America. No sooner was the English control complete here than the price of thread was advanced.