American politics (non-partisan) from the beginning to date

by Thomas V. Cooper; Hector T. Fenton

Gentlemen deceive themselves. It is not free trade that they are recommending to our acceptance. It is in effect, the British colonial system that we are invited to adopt; and, if their policy prevail, it will lead substantially to the re-colonization of these States, under the commercial dominion of Great Britain. And whom do we find some of the principal supporters, out of Congress, of this foreign system? Mr. President, there are some foreigners who always remain exotics, and never become naturalized in our country; whilst, happily, there are many others who readily attach themselves to our principles and our institutions. The honest, patient and industrious German readily unites with our people, establishes himself upon some of our fat land, fills his capacious barn, and enjoys in tranquillity, the abundant fruits which his diligence gathers around him, always ready to fly to the standard of his adopted country, or of its laws, when called by the duties of patriotism. The gay, the versatile, the philosophic Frenchman, accommodating himself cheerfully to all the vicissitudes of life, incorporates himself without difficulty in our society. But, of all foreigners, none amalgamate themselves so quickly with our people as the natives of the Emerald Isle. In some of the visions which have passed through my imagination, I have supposed that Ireland was originally, part and parcel of this continent, and that, by some extraordinary convulsion of nature, it was torn from America, and drifting across the ocean, was placed in the unfortunate vicinity of Great Britain. The same open-heartedness; the same generous hospitality; the same careless and uncalculating indifference about human life, characterize the inhabitants of both countries. Kentucky has been sometimes called the Ireland of America. And I have no doubt, that if the current of emigration were reversed, and set from America upon the shores of Europe, instead of bearing from Europe to America, every American emigrant to Ireland would there find, as every Irish emigrant here finds, a hearty welcome and a happy home!

But I have said that the system nominally called “free trade,” so earnestly and eloquently recommended to our adoption, is a mere revival of the British colonial system, forced upon us by Great Britain during the existence of our colonial vassalage. The whole system is fully explained and illustrated in a work published as far back as the year 1750, entitled “The Trade and Navigation of Great Britain considered, by Joshua Gee,” with extracts from which I have been furnished by the diligent researches of a friend. It will be seen from these, that the South Carolina policy now, is identical with the long cherished policy of Great Britain, which remains the same as it was when the thirteen colonies were part of the British empire.

I regret, Mr. President, that one topic has, I think, unnecessarily been introduced into this debate. I allude to the charge brought against the manufacturing system, as favoring the growth of aristocracy. If it were true, would gentlemen prefer supporting foreign accumulations of wealth, by that description of industry, rather than in their own country? But is it correct? The joint stock companies of the north, as I understand them, are nothing more than associations, sometimes of hundreds, by means of which the small earnings of many are brought into a common stock, and the associates, obtaining corporate privileges, are enabled to prosecute, under one superintending head, their business to better advantage. Nothing can be more essentially democratic or better devised to counterpoise the influence of individual wealth. In Kentucky, almost every manufactory known to me, is in the hands of enterprising and self-made men, who have acquired whatever wealth they possess by patient and diligent labor. Comparisons are odious, and but in defence, would not be made by me. But is there more tendency to aristocracy in a manufactory supporting hundreds of freemen, or in a cotton plantation, with its not less numerous slaves, sustaining perhaps only two white families—that of the master and the overseer?

I pass, with pleasure, from this disagreeable topic, to two general propositions, which cover the entire ground of debate. The first is, that under the operation of the American System, the objects which it protects and fosters are brought to the consumer at cheaper prices than they commanded prior to its introduction, or, than they would command if it did not exist. If that be true, ought not the country to be contented and satisfied with the system, unless the second proposition, which I mean presently also to consider, is unfounded? And that is, that the tendency of the system is to sustain, and that it has upheld the prices of all our agricultural and other produce, including cotton.

And is the fact not indisputable, that all essential objects of consumption effected by the tariff, are cheaper and better since the act of 1824, than they were for several years prior to that law? I appeal for its truth to common observation and to all practical men. I appeal to the farmer of the country, whether he does not purchase on better terms his iron, salt, brown sugar, cotton goods, and woolens, for his laboring people? And I ask the cotton planter if he has not been better and more cheaply supplied with his cotton bagging? In regard to this latter article, the gentleman from South Carolina was mistaken in supposing that I complained that, under the existing duty the Kentucky manufacturer could not compete with the Scotch. The Kentuckian furnishes a more substantial and a cheaper article, and at a more uniform and regular price. But it was the frauds, the violations of law of which I did complain; not smuggling, in the common sense of that practice, which has something bold, daring, and enterprising in it, but mean, barefaced cheating, by fraudulent invoices and false denomination.

I plant myself upon this fact, of cheapness and superiority, as upon impregnable ground. Gentlemen may tax their ingenuity and produce a thousand speculative solutions of the fact, but the fact itself will remain undisturbed.

This brings me to consider what I apprehend to have been the most efficient of all the causes in the reduction of the prices of manufactured articles—and that is COMPETITION. By competition, the total amount of the supply is increased, and by increase of the supply, a competition in the sale ensues, and this enables the consumer to buy at lower rates. Of all human powers operating on the affairs of mankind, none is greater than that of competition. It is action and reaction. It operates between individuals in the same nation, and between different nations. It resembles the meeting of the mountain torrent, grooving by its precipitous motion, its own channel, and ocean’s tide. Unopposed, it sweeps everything before it; but, counterpoised, the waters become calm, safe and regular. It is like the segments of a circle or an arch; taken separately, each is nothing; but in their combination they produce efficiency, symmetry, and perfection. By the American System this vast power has been excited in America, and brought into being to act in co-operation or collision with European industry. Europe acts within itself, and with America; and America acts within itself, and with Europe. The consequence is, the reduction of prices in both hemispheres. Nor is it fair to argue from the reduction of prices in Europe, to her own presumed skill and labor, exclusively. We affect her prices, and she affects ours. This must always be the case, at least in reference to any articles as to which there is not a total non-intercourse; and if our industry, by diminishing the demand for her supplies, should produce a diminution in the price of those supplies, it would be very unfair to ascribe that reduction to her ingenuity instead of placing it to the credit of our own skill and excited industry.

The great law of price is determined by supply and demand. Whatever affects either, affects the price. If the supply is increased, the demand remaining the same, the price declines; if the demand is increased, the supply remaining the same, the price advances; if both supply and demand are undiminished, the price is stationary, and the price is influenced exactly in proportion to the degree of disturbance to the demand or supply. It is therefore a great error to suppose that an existing or new duty necessarily becomes a component element to its exact amount of price. If the proportion of demand and supply are varied by the duty, either in augmenting the supply, or diminishing the demand, or vice versa, price is affected to the extent of that variation. But the duty never becomes an integral part of the price, except in the instances where the demand and the supply remain after the duty is imposed, precisely what they were before, or the demand is increased, and the supply remains stationary.

Competition, therefore, wherever existing, whether at home or abroad, is the parent cause of cheapness. If a high duty excites production at home, and the quantity of the domestic article exceeds the amount which had been previously imported the price will fall. This accounts for an extraordinary fact stated by a Senator from Missouri. Three cents were laid as a duty upon a pound of lead, by the act of 1828. The price at Galena, and the other lead mines, afterwards fell to one and a half cents per pound. Now it is obvious that the duty did not, in this case, enter into the price: for it was twice the amount of the price. What produced the fall? It was stimulated production at home, excited by the temptation of the exclusive possession of the home market. This state of things could not last. Men would not continue an unprofitable pursuit; some abandoned the business, or the total quantity produced was diminished, and living prices have been the consequence. But, break down the domestic supply, place us again in a state of dependence on the foreign source, and can it be doubted that we should ultimately have to supply ourselves at dearer rates? It is not fair to credit the foreign market with the depression of prices produced there by the influence of our competition. Let the competition be withdrawn, and their prices would instantly rise.

But, it is argued that if, by the skill, experience, and perfection which we have acquired in certain branches of manufacture, they can be made as cheap as similar articles abroad, and enter fairly into competition with them, why not repeal the duties as to those articles? And why should we? Assuming the truth of the supposition the foreign article would not be introduced in the regular course of trade, but would remain excluded by the possession of the home market, which the domestic article had obtained. The repeal, therefore, would have no legitimate effect. But might not the foreign article be imported in vast quantities, to glut our markets, break down our establishments, and ultimately to enable the foreigner to monopolize the supply of our consumption? America is the greatest foreign market for European manufactures. It is that to which European attention is constantly directed. If a great house becomes bankrupt there, its storehouses are emptied, and the goods are shipped to America, where, in consequence of our auctions, and our custom-house credits, the greatest facilities are afforded in the sale of them. Combinations among manufacturers might take place, or even the operations of foreign governments might be directed to the destruction of our establishments. A repeal, therefore, of one protecting duty, from some one or all of these causes, would be followed by flooding the country with the foreign fabric, surcharging the market, reducing the price, and a complete prostration of our manufactories; after which the foreigner would leisurely look about to indemnify himself in the increased prices which he would be enabled to command by his monopoly of the supply of our consumption. What American citizen, after the government had displayed this vacillating policy, would be again tempted to place the smallest confidence in the public faith, and adventure once more in this branch of industry?