59. (f) During the late presidential campaign the protectionist orators assured the people that they meant to make everybody well off, that they wished our people to be prosperous, contented, etc. I wish so too. I wish that all my readers may be millionaires. I freely and sincerely confer on them all the bounty of my good wishes. They will not find a cent more in their pockets on that account. The congressmen have no power to bless my readers which I have not, save one; that is, the power to tax them.
60. (g) If the congressmen are determined to elevate the comfort of the population by taxing the population, then every new ship load of immigrants must be regarded as a new body of persons whom we must “elevate” by the taxes we have to pay. It is said that an Irishman affirmed that a dollar in America would not buy more than a shilling in Ireland. He was asked why then he did not stay in Ireland. He replied that it was because he could not get the shilling there. That is a good story, only it stops just where it ought to begin. The next question is: How does he get the dollar when he comes to America? The protectionist wants us to suppose that he gets it by grace of the tariff. If so he gets it out of those who were here before he came. But plainly no such thing is true. He gets it by earning it, and he adds two dollars to the wealth of the country while earning it. The only thing the tariff does in regard to it is to lower the purchasing power of the dollar, if it is spent for products of manufacture, to seventy cents.
61. Here, again, then, we find that protective taxes, if they do just what the protectionist says that they will do, produce the very opposite effects from those which he says they will produce. They lessen wealth, reduce prosperity, diminish average comfort, and lower the standard of living. (See § [30].)
Chapter III
PROTECTIONISM EXAMINED ADVERSELY
62. I have so far examined protectionism as a philosophy of national wealth, assuming and accepting its own doctrines, and following them out, to see if they will issue as is claimed. We have found that they do not, but that protectionism, on its own doctrines, issues in the impoverishment of the nation and in failure to do anything which it claims to do. On the contrary, an examination in detail of its means, methods, purposes, and plans shows that it must produce waste and loss, so that if it were true, we should have to believe that waste and loss are means of wealth. Now I turn about to attack it in face, on an open issue, for if any project which is advocated proves, upon free and fair examination, to be based on errors of fact and doctrine, it becomes a danger and an evil to be exposed and combated, and truth of fact and doctrine must be set against it.
1. PROTECTIONISM INCLUDES AND NECESSARILY CARRIES WITH IT HOSTILITY TO TRADE OR, AT LEAST, SUSPICION AGAINST TRADE
(A) Rules for Knowing when it is Safe to Trade.
63. Every protectionist is forced to regard trade as a mischievous or at least doubtful thing. Protectionists have even tried to formulate rules for determining when trade is beneficial and when harmful.
64. It has been said that we ought to trade only on meridians of longitude, not on parallels of latitude.
65. It has been affirmed that we cannot safely trade unless we have taxes to exactly offset the lower wages of foreign countries. But it is plain that if the case stands so that an American employer says: “I am at a disadvantage compared with my foreign competitor, because he pays less wages than I”—then, by the same token, the American laborer will say: “I am at an advantage, compared with my foreign comrade, for I get better wages than he.” If the law interferes with the state of things so that the employer is enabled to say: “I am now at less disadvantage in competition with my foreign rival, because I do not now have to pay as much more wages than he as formerly”—then, by the same token, the American laborer must say: “I am not now as much better off than my foreign comrade as formerly, for I do not now gain as much more than he as I did—there is not now as much advantage in emigrating to this country as formerly.” Therefore, whenever the taxes just offset the difference in wages, they just take away from the American laborer all his superiority over the foreigner, and take away all reason for caring to come to this country. So much for the laborer. But the employer, if he has arrested immigration, has cut off one source of the supply of labor, tending to raise wages, and is at war with himself again (§ [47]).