Mr. Tucker.—The observations I made yesterday were intended to apply generally against a system of high duties. As to the particular article of spirits, I have no objection to a high duty being laid upon it, provided it can be strictly collected; for I do not wish to give encouragement to the consumption of that article, though, I fear, no duty we can lay will tend much to discourage it. I thought that if it was the general opinion of the House to lessen the duties, it would be a saving of time to discuss it on a motion to reduce the first article. I repeat the observation, that high duties are improper, because they are impolitic, and likely to defeat the object of revenue: less will be collected on them than on moderate ones. If it be considered as an encouragement to manufactures to lay heavy duties on enumerated articles, it is a tax on one part for the emolument of another. Five per cent. upon all articles imported would raise a considerable revenue, and be a sufficient encouragement to manufactures, especially if we add to this five per cent. the expense of freight and other charges of importation on foreign goods. The five per cent. in the bill is to be collected on the value of the goods at the time and place of importation; the value of goods within the United States is twenty-five per cent. more than they cost in Europe; adding this therefore to the other advantages, and it will be a considerable encouragement; but, besides all this, there are many articles made here as cheap, and cheaper than they can be imported. Gentlemen, who have given us this information, know the fact to be so in their respective States; in them, therefore, the operation of the measure would be just and politic, but it does not apply with the same force as it respects South Carolina and some other States. Although in Boston and Philadelphia they can manufacture certain wares cheaper than they can import them, yet they are not brought at the same price to Charleston: hence the operation is unequal and a partial tax upon us. Another thing to be considered is, even if these articles could be furnished us at home as cheap as we get them from abroad, whether we should have equal advantages? If a cargo of nails were to be sent to Carolina, I would be glad to know how we are to purchase it? Would the makers of shoes be content to go there and retail them? If they would, they might be brought there; but I apprehend, if they have not established connections in that country, they could never be disposed of. Can they expect the planters to come in a body, and take off their goods upon their arrival? It is not even expected that they could; it must be left to them to judge, whether they do not purchase them in a better way, by taking them upon credit, and paying for them in their crop. Gentlemen will not pretend to say that we do not know our own interest, and therefore they will teach us. These reasons will not go down with the people; they will take to themselves the right of judging what is most conducive to their interests. Gentlemen cannot argue from the fact, that we do not consume the articles made within their States, as readily and willingly, as those imported from abroad, merely because we do not wish to encourage them. Facts prove the direct contrary: we have shown a disposition to encourage articles from their States which can be made in our State in great abundance. I will mention a few of them, although it may appear disgraceful for South Carolina to take from any country what she can furnish herself. We have imported to the city of Charleston vegetables for table use, which we can raise as well as any part of the world; yet no complaint was made by the agricultural interest of that State, that we imported foreign productions to their prejudice; no duty was imposed to discourage the use of them; all we considered was, whether they came cheaper when brought from abroad than when raised at home, concluding the cheapest to be the best.
On the same principles that are now urged, our citizens might have contended that we should impose a duty on all articles which could be produced at home. No imposition on the importation was laid in order to encourage the productions of our country; the same principle ought to have induced us to lay a duty on the importation of flour. We make but little of that; our constituents consume rice in place of it. It might have been said that a heavy duty should have been laid in order to prevent the interference with our staple commodity. The planters should have said, we will compel you to eat rice, and after being some time in the habit you will find you will like it as well as we; indeed, this argument might be extended to a measure calculated to oblige the other States to use rice in their daily food. It might be said, that it was necessary in order to give encouragement to the productions of the Southern States, but I believe such arguments would have had no weight if they had been used; yet they are similar to what have been brought forward by gentlemen for the encouragement of domestic manufactures.
Mr. Speaker, if gentlemen are content with moderate duties, we are willing to agree to them and give every reasonable encouragement in our power, but we cannot consent to very great oppression. I once more wish that gentlemen will consider great duties as imposing a heavier burthen upon the Southern States, as they import more, the other less; and the sum we pay towards the revenue must be in proportion to our importation. I therefore move, in order to begin with the first article, that distilled spirits be reduced six cents per gallon.
Mr. Jackson seconded this motion, and would assign his reasons for it, but they had been so fully stated by the honorable mover.
Mr. Ames.—I wish the committee may consider, with the attention the subject demands, whether the duties are too high or not? It is hardly possible, I own, to contemplate this subject as a practical question. We shall find it necessary to consider attentively, before we proceed any further, what the objects of our Government are; and, having discovered them, we are to consider whether the proposed measure will answer the purposes intended. I believe in every point of view that we can possibly consider it, the subject of revenue will be thought to be one of the primary objects to which the power of Government extends. It has long been apprehended, that an ill administration of the new constitution was more to be feared, as inimical to the liberties of the people, than any hostility from the principles of the constitution. Of all the operations of Government, those which concern taxation are the most delicate as well as the most important. This observation applies to all governments. Revenue is the soul of Government, and if such a soul had not been breathed into our body politic it would have been a lifeless carcass, fit only to be buried. I would wish this soul might be actuated by rational principles, that, in establishing a revenue system, we might go on a superior principle to that which has heretofore been the governing principle in the United States; that we might consider what was most adequate to the object. The nature of the revenue system in this Government is to the last degree important; for want of the soul, the late Government was found utterly incapable of invigorating and protecting industry, or securing the Union; therefore these seem to be the great objects which we are to accomplish. I consider the present question as a direct application to the principles of the constitution; it will either support or destroy them. If the revenue system should fall with oppressive weight on the people, if it shall injure some in their dearest interests, it will shake the foundation of the Government. However the newspapers may stand your friends, and trumpet forth panegyrics on the new constitution, if your administration does not give satisfaction, you will find all ineffectual that they can do, whilst the people are against you. This being admitted, the Government will not push their regulations too far; they will consider the weaknesses and prejudices of the individual members of the Union. When they lay a tax, they will consider how far it is agreeable to them, and how far the measure is wise in itself. If it is said the article to be taxed is a luxury, and the Government is zealous to correct the vice, they will be careful they do not do it in too severe a manner; the principle would be capable of great expansion: all the enjoyments of social life are luxuries, and, as objects of revenue, we ought to set a price on the enjoyment, without suppressing their use altogether. Neither ought we to consider what the article in this point of view is able to pay, so much as what we may reasonably expect to collect from it.
Mr. Madison.—The right understanding of this subject is of great importance. The discussion has been drawn out to a very considerable length on former occasions. The chain of ideas on which the subject is suspended, is not very long, nor consists of many links. The present constitution was framed to supply the defects of the one that has preceded it. The great and material defects of it are well known to have arisen from its inability to provide for the demands of justice and security of the Union. To supply those defects, we are bound to fulfil the public engagements; expectation is anxiously waiting the result of our deliberations; it cannot be satisfied without a sufficient revenue to accomplish its purposes. We cannot obtain the money any other way but by taxation. Among the various objects of this nature, an impost on merchandise imported is preferable to all others, and among the long list of articles included in the bill, there is not one more proper for the purpose than the article under consideration. The public sentiment has strongly pointed it out as an object of revenue. I conceive, therefore, that it will be our duty to draw from this source all the money that it is capable of yielding. I am sure that it will not exceed our wants, nor extend to the injury of our commerce. How far the powers of Government are capable of going on this occasion, is matter of opinion; we have had no direct experiment of what can be done under the energy and popularity of the new system; we must recur to other sources for information, and then, unless the circumstances are alike, the comparison may not be true. We have been referred to the experience of other nations; if that is to guide us on this subject, I am sure we shall find precedents for going much farther than is now proposed. If I do not mistake the calculations that I have seen of duties on importation, they amount to more on an average than fifteen per cent.; the duty on ardent spirits in all nations exceeds what is in contemplation to be laid in the United States. I am sensible that the means which are used by those nations to insure the collection, would be odious and improper in this country; but I believe the means which this country is capable of using, without exciting complaint or incurring too much expense, would be as adequate to secure a duty of fifteen per cent. as the powers of any other nation could be to obtain ninety or one hundred per cent. I pay great respect to the opinions of mercantile gentlemen, and am willing to concede much to them, so far as their opinions are regulated by experience; but if I am to be guided by this information, it will not lead me to agree to the reduction of the duties in the manner contended for. It is said, that if we reduce at all, we must go through the whole. Now I doubt whether the duty on the article of rum exceeds that proportion which pervades the long list before us. It does not amount to more than thirty per cent., while some other articles stand at forty; some articles again that are not enumerated, but which fall within the general mass at five per cent., are more likely to be introduced clandestinely than this article, if it stood at fifty per cent. I am sure, if we reduce the whole system in the manner now proposed, all the duty we shall be able to collect will be very incompetent to what the public necessities demand. We must turn our eyes, then, to some other source that will fill up the deficiency. There are but two objects to which in this dilemma we can have recourse—direct taxation and excises. Direct taxation is not contemplated by any gentleman on this floor, nor are our constituents prepared for such a system of revenue; they expect it will not be applied to, until it is found that sufficient funds cannot be obtained in any other way. Excises would give particular disgust in some States, therefore gentlemen will not make up the deficiency from that quarter. I think, upon the whole, it is better to try what will be produced by a plan which is favored by the public sentiment. This will give a support to our laws equal to the greatest energy of a strong execution. The citizens of America know that their individual interest is connected with the public. We shall then have the strong motive of interest acting in favor of the Government in a peculiar manner. But I am not inclined to trust too much to this security. I would take in the aid of the best regulations in our power to provide; these acting in concert, would give a moral certainty to the faithful collection of the revenue. But if gentlemen, notwithstanding, will persist in contending against such a system, and cannot offer us a substitute, we must fail of the primary object for which the Government was created. If upon experience we find that the duties cannot be safely collected, it may be proper to reduce them; but if we set them too low in the first instance, and they do not yield a sufficiency to answer the just demands of the public creditors and the expenses of Government, the public reputation must suffer.
Mr. Bland.—I join with the gentlemen who are disposed to lower the duties. Although I feel the necessity we are under of raising revenue as much as any other gentleman possibly can, yet I think we ought to deliberate fully upon the means before we adopt them. It is demonstrable, nay it is self-evident, that laying high duties, in the first instance, will beget smuggling, and I fear our regulations, respecting the collection, will prove the impracticability of defeating the practice. But when we come to consider the subject in another point of view, I trust such a system will be found unnecessary. The enumerated articles in this bill are very numerous; they are taxed from fifty per cent. downwards; the general mass pays five per cent. The calculations made by the late Congress, who no doubt maturely considered the subject, found a list of eight articles only, and those at one-fourth or one-fifth of the rate now proposed, would produce a revenue of nine hundred and fifteen thousand six hundred and fifty-six dollars annually.
When we add to this calculation a circumstance of notoriety, the increase of our importation, we shall find that we levy, or mean to levy, greater sums than the public necessities require. There will not be found specie enough within the United States to pay the duties: four times the rate of what the former Congress recommended, will produce three millions six hundred thousand dollars. The enumeration is four times as great also; hence we may infer, that the amount will reach thirteen or fourteen millions. At least we shall be convinced that we are upon too high a scale. But where is the necessity of raising the impost to this degree? There are other means of revenue, and such as will not give disgust. We have already proposed a duty on tonnage; there is the post-office, and some other things which the ingenuity of Government can devise and is entitled to, for the purpose of revenue; if it is therefore unnecessary to levy such oppressive taxes, what other pretext can be set up for adopting the system? Independent of every other consideration, this ought to induce us to lower them. But there are other and weighty considerations; but as they have been well urged by the gentleman from Massachusetts, (Mr. Ames,) I shall not touch upon them. It is said, that it is merely matter of opinion whether they are too high or not; if so, let us be careful not to venture too far on such ground. It will be much better to reduce it in the manner proposed by the gentleman from South Carolina, and increase it hereafter, than strain the measure too high at present.
Mr. Sherman.—After this subject had been debated in a Committee of the Whole, and then in the House upon the report, and every argument that could be thought of had been urged, both on the general and particular amount of the duties proposed, and the probable effects of a deduction, I did not expect to have heard the same debate take place again. Gentlemen have a large field to display their abilities in, but I do not think it contains any new matter that will induce a single gentleman to alter his opinion on the subject. The great object is to raise a sum of money adequate to supply our wants; and let us dispute as we will about the mode, the fact is it must be raised. The people have sent their representatives here for this purpose; it is for their benefit that we raise the money, and not for any peculiar advantage to ourselves; the objects are to pay the debts, and to provide for the general welfare of the community. The first of these objects I take to be, that we pay our debts. There are very many meritorious characters who furnished us with essentials in the hour of imminent danger, who, from the imbecility of our former Government, have not been able to get even the interest of what they loaned us. I believe it is the first wish of the people throughout the United States to do justice to the public creditors, and to do it in such a manner, that each may contribute an equal part according to his abilities. We have very considerable arrearages due on this account, upon not only the domestic but foreign debt; there are several instalments not yet discharged, and considerable of the interest not yet paid. No statement can be made of the expenses of Government, so as to ascertain what quantity of revenue will be demanded on that head, but saying that they will be much the same under this Government as the former, and we shall have occasion for a very considerable sum to defray the expenses. I believe we are not able to make a very accurate calculation of what the system, proposed in the bill, will yield. The late Congress contemplated a million of dollars from this source, which, in aid of the requisition, they supposed sufficient for the purpose of paying the instalments of the national debt and interest; but that sum alone will now be found very short of what is wanted without the aid of direct taxes. It is very material that we lay the burthen as equal as possible, in whatever mode we pursue to obtain revenue: a great deal of care has been taken in distributing the proportion with equity; I apprehend, therefore, that we shall not be able to make it much more equitable by any alteration than it is at present. I think, also, that the people will pay more freely a duty of this nature than they will in direct taxes. If gentlemen prevail in getting the duties lowered to what the late Congress proposed, they will find themselves obliged to have recourse to direct taxation for a million and a half, or two millions of dollars. It then only remains for us to consider, whether it will be more agreeable to the people to reduce the impost in this manner, and raise the deficiency by direct taxes. If these duties are to be considered as a tax on the trading part of the community alone, they are improper; but this I believe is not the case; the consumer pays them eventually, and they pay no more than they choose, because they have it in their power to determine the quantity of taxable articles they will use. A tax left to be paid at discretion must be more agreeable than any other. The merchant considers that part of his capital applied to the payment of the duties the same as if employed in trade, and gets the same profit upon it as on the original cost of the commodity.
Mr. White.—When this system first came before the committee, I was opposed to enter into an enumeration, because I supposed much time would be taken up in the discussion, which would be an absolute loss of revenue, perhaps to a greater amount than the difference between the duties of such a system and the one proposed by the late Congress; but as it was thought proper by the committee to proceed in the way that we have done, it would be presumption in me to say, that the duty on every article has been perfectly digested and properly laid, but I believe every article stands as well as can be upon the information we are in possession of. I believe very few, if any, of the articles can be disapproved of.