The Tariff in Our Times

by Ida M. Tarbell

“The importations are not so large that we feel justified in asking that the duties be increased, but we would not like to see them decreased.”

Upon this representation of the “wants” of the manufacturers the trade rested. If Mr. Lippitt asked that the schedule be left as it was, there was general confidence that it would be done. There seems to have been little or no curiosity about “the very minor points” to which Mr. Lippitt referred. He did not make these known to the Committee itself until some six weeks later. Then in a letter written for the Arkwright Club of Boston, the leading organization of cotton manufacturers in the country, Mr. Lippitt and a fellow manufacturer, Mr. J. R. MacColl, the manager of the Lorraine Mills of Pawtucket, Rhode Island, made certain suggestions to Mr. Payne. This letter was not read at the public hearings; it was not published until the Appendix to the hearings came out. The first the public knew of it was when Mr. Payne reported his bill to the House on March 17, 1909; and then an uproar began. Far from “minor” changes having been made, it was declared that radical and complicated ones sure to bring great confusion had been introduced. To make the cotton schedule any more complicated than it has been for fifty years is in itself a severe criticism. Under the Dingley Bill cotton cloth was subject to four distinct classifications in fixing duties. These were based upon the number of threads to a square inch, the weight, color, and value. Duties were graded also according to the varying fineness, weight, and value, so that there were scores of combinations in duties possible. If, after all this, the cloth had a figure worked in it, as so many of the finer goods do, there was an extra duty per square yard for that.

It would seem difficult to add anything to this complication, but Mr. Payne’s bill did it. It began by upsetting an established definition in the cotton trade—a definition accepted the world over as to what the word “thread” means in appraising cloth. A thread has been a thread, regardless of how many filaments or ply were twisted together to make it. This was no longer to be so. The poor appraiser could no longer apply his magnifying glass to a square inch of cotton cloth and count the threads: he must untwist a thread and compute the number of ply! Of course this immediately threw the fabric into a higher classification than under the old law, and increased the duty on it. A cloth which counted fifty threads carried under the old law a duty of say one cent per square yard, but if these threads were three ply—and each ply must be counted by the new paragraph—then it was at once boosted into the one hundred and fifty thread class, where the duty is one and one-half cents per square yard! This was the first of Mr. Lippitt’s “very minor points.” But this did not end the counting business. There is a great variety of cotton cloths which have figures worked on to the body. The swisses and curtain madras are common examples of these. These figures, of course, increase the value of the goods, and the Dingley Bill provided for them by giving them an extra one or two cents per square yard, according as they cost seven or over seven cents a square yard. But Mr. Payne’s bill went this duty one better by arranging that when the threads of a cloth were counted not the threads in the body alone should be considered, but also the threads in the figure worked on the body. Here again the number of threads in a square inch would be so increased as to throw the fabric into a higher class and so raise the duty. Another increase came in the matter of color. Heretofore the body of the cloth had been all that was considered in estimating color, but the new law proposed that cloth into which colored figures or threads had been introduced should be called colored. A single colored thread introduced into a white piece was enough to throw it into the colored class. One entirely new duty was added, and that was a cent a yard for cloth which had been mercerized—and a single mercerized thread was enough to put a piece into this class.

Besides all this reclassification, the duties which in the Dingley Bill had been added for the value of the cloth were increased and complicated in a most irritating fashion—by dividing the values into several classes. There was one duty for cloths worth 12½ to 15 cents, another for those worth 15 to 17½, another for those worth from 17½ to 20. But who was to fix the value when the margins were so narrow? It was a temptation to fraud,—the importer naturally trying to prove that the cloth worth 13 cents was worth but 12½; his opponent, the domestic manufacturer, trying to prove that the cloth really worth 12½ was worth 13.

Mr. Payne reported a schedule then which not only raised duties on many kinds of cotton goods, but multiplied the opportunities for fraud and added seriously to the work of appraising. Mr. Payne claimed to have been entirely misled about what the new rates would do—at least about the changes in counting threads—for when the schedule came up he rose in the House and asked that the old methods of counting be restored, and he said with an emphasis which showed his disgust at the way he felt he had been tricked:

“The committee has not sought to increase the duty by that method. If they wanted to increase the duty, they would go in the open to do it.”

The cotton schedule came to Mr. Aldrich, therefore, under suspicion—suspicion of having been cleverly and slyly revised upwards by the advice of one of his strongest and most generous political supporters, the man who had the credit of managing his last senatorial campaign and collecting the large sums of money which it required to reëlect him. Naturally the curiosity was keen about what Mr. Aldrich would report. What he reported was, with one exception, just what Mr. Lippitt and Mr. MacColl had asked for. He did not stand for the new definition of thread which they had invented, but he did provide that the number of threads and the color should no longer depend on the body of a cloth, but should be estimated by the figure wrought into it. He practically asked that if a single colored thread was woven in or applied to a piece of shirting, it should take the added duty which was given to colored goods. He also stood by the clause which put an additional cent on all which had even one mercerized thread in them, and by the complicated specific duties which had been invented for all goods costing over 12½ cents per square yard.

Now if Mr. Aldrich believed that the rates on these particular cotton goods should be raised and complicated in this way, he was justified in raising them; but there has never been a time in the history of protection in this country when it was more imperative for a new and increased duty to be clearly explained. There was never a time when it was more necessary that all rates should be measured by the fundamental principles of protection. It was Mr. Aldrich’s business to prove to the Senate that the new rates were justifiable. But Mr. Aldrich made no attempt to do anything of the kind. On the contrary, when the charges were taken sharply to account by Senator Dolliver in an analysis which must stand as a model of the kind of criticism which every schedule in the tariff bill needs from Protectionists, Mr. Aldrich met him by asserting that the rates on cotton goods had not been raised. That all that had been done was to readjust duties in such a way as to restore the “intent” of the Dingley Bill, which, he said, had been largely destroyed by certain court decisions. It is easy to show how far from the fact Mr. Aldrich was in his statement. The fabrics which had been referred to the courts were few in number, including the goods known as etamine and Madras curtain goods. There had been no court decision whatever affecting the great bulk of plain cotton goods, white or colored; and yet the tables estimating duties which are to-day in use by one of the largest and most respected importing houses in this country show that the increase in duties on colored cotton cloths of from 100 to 150 threads per square inch are all the way from about 2 to 42 per cent, and as usually happens the 2 per cent increase is on the highest priced goods. If these same goods were mercerized, the increase in duties is from about 12 to 56 per cent. In the next higher grade of fineness (over 150 and not over 200 threads) the duties have increased from 2 to 24 per cent—if mercerized, from 14 to 38 per cent. White goods of the ordinary weaves of the same grades of fineness as those above have like increases. Not one of these cloths was touched or could be touched by the court decisions Mr. Aldrich hid behind.

It was inevitable that when the effect of the changes was made clear there should have been at once a cry raised that Mr. Aldrich, in allowing these increases of duties, was rewarding Mr. Lippitt for the able work it was known that he had done in the last senatorial campaign. It was pointed out that the goods affected were not common coarse goods. They were the higher grades which are made in the Manville Mills, and well made. It was also said that Mr. Lippitt was adding to his mills a big mercerizing plant. “He expects to pay for it out of that extra cent,” the cynical said. It was certainly natural and necessary that Mr. Aldrich should resent these charges, but Mr. Aldrich went a little too far in his denials, and, taken seriatim, they look queer, at least.

“No manufacturer has been before the Committee on Finance in regard to this schedule. Every change that was made in it was made upon the recommendation of the government experts and nobody else.”