Secondly, it is said that a nation should be independent of foreign nations, lest in time of war it might find itself helpless or defenceless. Free trade, it is charged, makes a people dependent upon foreigners. But traffic is exchange. Foreign products do not come into a country unless domestic products go out. This dependence, therefore, is mutual. By trade with foreign nations they are as dependent upon us as we upon them, and in the event of a disturbance of peace the nation with which we would be at war would lose just as much as we would lose, and both as to the war would in that regard stand upon terms of equality. It must not be forgotten that the obstruction of trade between nations is one of the greatest occasions of war. It frequently gives rise to misunderstandings which result in serious conflicts. By removing these obstacles and making trade as free as possible, nations are brought closer together, the interests of their people become intermingled, business associations are formed between them, which go far to keep down national dispute, and prevent the wars in which the dependent nation is said to be so helpless. Japan and China have for centuries practised the protective theory of independence of foreigners, and yet, in a war with other nations, they would be the most helpless people in the world. That nation is the most independent which knows most of, and trades most with, the world, and by such knowledge and trade is able to avail itself of the products of the skill, intellect, and genius of all the nations of the earth.
A third erroneous impression sought to be made upon the public mind is that whatever increases the amount of labor in a country is a benefit to it. Protection, it is argued, will increase the amount of labor, and therefore will increase a country's prosperity. The error in this proposition lies in mistaking the true nature of labor. It regards it as the end, not as the means to an end. Men do not labor merely for the sake of labor, but that out of its products they may derive support and comfort for themselves and those dependent upon them. The result, therefore, does not depend upon the amount of labor done, but upon the value of the product. That country, therefore, is the most prosperous which enables the laborer to obtain the greatest possible value for the product of his toil, not that which imposes the greatest labor upon him. If this were not the case men were better off before the appliances of steam as motive power were discovered, or railroads were built, or the telegraph was invented. The man who invents a labor-saving machine is a public enemy; and he would be a public benefactor who would restore the good old times when the farmer never had a leisure day, and the sun never set on the toil of the mechanic. No, Mr. Chairman, it is the desire of every laborer to get the maximum of result from the minimum of effort. That system, therefore, can be of no advantage to him which, while it gives him employment, robs him of its fruits. This, it will be seen, protection does, while free trade, giving him unrestricted control of the product of his labor, enables him to get the fullest value for it in markets of his own selection.
The protectionist, relying upon the propositions I have thus hurriedly discussed, urges many specious reasons for his system, to a few of which only do I intend to call attention to-day.
In the first place, it is urged that protection will develop the resources of a country, which without it would remain undeveloped. Of course this, to be of advantage to a country, must be a general aggregate increase of development, for if it be an increase of some resources as a result of diminution in others, the people as a whole can be no better off after protection than before. But the general resources cannot be increased by a tariff. There can only be such an increase by an addition to the disposable capital of the country to be applied to the development of resources. But legislation cannot make this. If it could it would only be necessary to enact laws indefinitely to increase capital indefinitely. But, if any legislation could accomplish this, it would not be protective legislation. As already shown, the theory of protection is to make prices higher, in order to make business profitable. This necessarily increases the expense of production, which keeps foreign capital away, because it can be employed in the protected industries more profit-ably elsewhere. The domestic capital, therefore, must be relied upon for the proposed development. As legislation cannot increase that capital, if it be tempted by the higher prices to the business protected, it must be taken from some other business or investment. If there are more workers in factories there will be fewer artisans. If there are more workers in shops there will be fewer farmers. If there are more in the towns there will be fewer in the country. The only effect of protection, therefore, in this point of view, can be to take capital from some employment to put it into another, that the aggregate disposable capital cannot be increased, nor the aggregate development of the resources of a country be greater with a tariff than without.
But, secondly, it is said that protection increases the number of industries, thereby diversifying labor and making a variety in the occupations of a people who otherwise might be confined to a single branch of employment. This argument proceeds upon the assumption that there would be no diversification of labor without protection. In other words, it is assumed that but for protection our people would devote themselves to agriculture. This, however, is not true. Even if a community were purely agricultural, the necessities of the situation would make diversification of industry. There must be blacksmiths, and shoemakers, and millers, and merchants, and carpenters, and other artisans. To each one of these employments, as population increases, more and more will devote themselves, and with each year new demands will spring up, which will create new industries to supply them. I was born in the midst of a splendid farming country. The business of nine tenths of the people of my native county was farming. My intelligent boyhood was spent there from 1850 to 1860, when there was no tariff for protection. There were thriving towns for the general trading. There were woollen mills and operatives. There were flouring mills and millers. There were iron founders and their employes. There were artisans of every description. There were grocers and merchants, with every variety of goods and wares for sale; there were banks and bankers; there was all the diversification of industry that a thriving, industrious, and intelligent community required; not established by protection nor by government aid, but growing naturally out of the wants and necessities of the people. Such a diversification is always healthful, because it is natural, and will continue so long as the people are industrious and thrifty. The diversification which protection makes is forced and artificial. Suppose protection had come to my native county to further diversify industries. It would have begun by giving higher prices to some industry already established, or profits greater than the average rate to some new industry which it would have started. This would have disturbed the natural order. It would necessarily have embarrassed some interests to help the protected ones. The loss in the most favorable view would have been equal to the gain, and besides trade would inevitably have been annoyed by the obstruction of its natural channels.
The worst feature of this kind of diversified industry is that the protected ones never willingly give up the government aid. They scare at competition as a child at a ghost. As soon as the markets seem against them, they rush to Congress for further help. They are never content with the protection they have; they are always eager for more. In this dependence upon the government bounty the persons protected learn to distrust themselves; and protection therefore inevitably destroys that manly, sturdy spirit of individuality and independence which should characterize the successful American business man.
Thirdly, it is said that protection gives increased employment to labor and enhances the wages of workingmen. For a long time no position was more strenuously insisted upon by the advocates of the protective system than that the wages of labor would be increased under it. At this point in the discussion I shall only undertake to show that it is impossible that protection should produce this result. What determines the amount of wages paid? Some maintain that it is the amount of the wage fund existing at the time that the labor is done. Under this theory it is claimed that, at any given time, there is a certain amount of capital to be applied to the payment of wages, as certain and fixed as though its amount had been determined in advance. Others maintain that the amount of wages is fixed by what the laborer makes, or, in other words, by the product of his work, and that, therefore, his wage is determined by the efficiency of his labor alone. Both these views are partly true. The wages of the laborer are undoubtedly determined by the efficiency of his work, but the aggregate amount paid for labor cannot exceed the amount properly chargeable to the wage fund without in a little time diminishing the profits of production and ultimately the quantity of labor employed.'
But, whichever theory be true, it is clear that protection can add nothing to the amount of wages. It cannot increase the amount of capital applicable to the payment of wages, unless it can be shown that the aggregate capital of a country can be increased by legislation; nor can it add to the efficiency of labor, for that depends upon individual effort exclusively. A man who makes little in a day now may in a year make much more in the same time; his labor has become more efficient. Whether this shalt be done depends on the taste, temperament, application, aptitude, and skill of the individual. No one will pretend that protection can increase the aggregate of these qualities in the labor of the country. The result is that it is impossible for protection, either by adding to the wage fund or by increasing the efficiency of labor, to enhance the wages of laboring men, a theory which I shall shortly show is incontrovertibly established by the facts.
I will now, Mr. Chairman, briefly present a few of the principal objections to a tariff for protection. As has been shown, the basis of protection is an increase in the price of the protected products. Who pays this increased price? I shall not stop now to consider the argument often urged that it is paid by the foreign producer, because it can be easily shown to the contrary by every one's experience. I shall for this argument assume it as demonstrated that the increase of price which protection makes is paid by the consumer. This suggests the first great objection to protection, that it compels the consumer to pay more for goods than they are really worth, ostensibly to help the business of a producer. Now consumers constitute the vast majority of the people. The producers of protected articles are few in comparison with them. It is true that most men are both producers and consumers. But, for the great majority, there is little or no protection for what they produce, but large protection for what they consume. The tariff is principally levied upon woollen goods, lumber, furniture, stoves and other manufactured articles of iron, and upon sugar and salt. The necessities of life are weighted with the burden. It is out of the necessities of the people, therefore, that the money is realized to support the protective system. I say, Mr. Chairman, that it is beyond the sphere of true governmental power to tax one man to help the business of another. It is, by power, taking money from one to give it to another. This is robbery, nothing more nor less. When a man earns a dollar it is his own; and no power of reasoning can justify the legislative power in taking it from him except for the uses of the government.
Yet, Mr. Chairman, the present tariff takes hundreds of millions of dollars every year from the farmer, the laborer, and other consumers, under the claim of enriching the manufacturer. It may not be much for each one to contribute, yet in the aggregate it is an enormous sum. For many, too, it is very much. The statistics will show that every head of a family who receives four hundred dollars a year in wages pays at least one hundred dollars on account of protection. Put such a tax on all incomes and the country would be in a ferment of excitement until it was removed. But it is upon the poor and lowly that the tax is placed, and their voices are not often heard in shaping the policies of tariff legislation. I repeat, the product of one's labor is his own. It is his highest right, subject only to the necessities of the government, to do with it as he pleases. Protection invades, destroys that right. It ought to be destroyed, until every American freeman can spend his money where it will be of the most service to him.