What is the present tariff policy of the protectionists? It is not the ancient protective policy to which I would give all due credit, but an entirely new doctrine. I ask anybody who is interested in the history of high "protective" tariffs to compare the latest platforms of the two "protective" tariff parties with the old doctrine. Men have been struck, students of this matter, by an entirely new departure. The new doctrine of the protectionist is that the tariff should represent the difference between the cost of production in America and the cost of production in other countries, plus a reasonable profit to those who are engaged in industry. This is the new part of the protective doctrine: "plus a reasonable profit." It openly guarantees profit to the men who come and ask favors of Congress. The old idea of a protective tariff was designed to keep American industries alive and, therefore, keep American labor employed. But the favors of protection have become so permanent that this is what has happened: Men, seeing that they need not fear foreign competition, have drawn together in great combinations. These combinations include factories (if it is a combination of factories) of all grades: old factories and new factories, factories with antiquated machinery and factories with brand-new machinery; factories that are economically and factories that are not economically administered; factories that have been long in the family, which have been allowed to run down, and factories with all the new modern inventions. As soon as the combination is effected the less efficient factories are generally put out of operation. But the stock issued in payment for them has to pay dividends. And the United States government guarantees profit on investment in factories that have gone out of business. As soon as these combinations see prices falling they reduce the hours of labor, they reduce production, they reduce wages, they throw men out of employment,—in order to do what? In order to keep the prices up in spite of their lack of efficiency.
There may have been a time when the tariff did not raise prices, but that time is past; the tariff is now taken advantage of by the great combinations in such a way as to give them control of prices. These things do not happen by chance. It does not happen by chance that prices are and have been rising faster here than in any other country. That river that divides us from Canada divides us from much cheaper living, notwithstanding that the Canadian Parliament levies duties on importations.
But "Ah!" exclaim those who do not understand what is going on; "you will ruin the country with your free trade!" Who said free trade? Who proposed free trade? You can't have free trade in the United States, because the government of the United States is of necessity, with our present division of the field of taxation between the federal and state governments, supported in large part by the duties collected at the ports. I should like to ask some gentlemen if very much is collected in the way of duties at the ports under the particular tariff schedules under which they operate. Some of the duties are practically prohibitive, and there is no tariff to be got from them.
When you buy an imported article, you pay a part of the price to the Federal government in the form of customs duty. But, as a rule, what you buy is, not the imported article, but a domestic article, the price of which the manufacturer has been able to raise to a point equal to, or higher than, the price of the foreign article plus the duty. But who gets the tariff tax in this case? The government? Oh, no; not at all. The manufacturer. The American manufacturer, who says that while he can't sell goods as low as the foreign manufacturer, all good Americans ought to buy of him and pay him a tax on every article for the privilege. Perhaps we ought. The original idea was that, when he was just starting and needed support, we ought to buy of him, even if we had to pay a higher price, till he could get on his feet. Now it is said that we ought to buy of him and pay him a price 15 to 120 per cent. higher than we need pay the foreign manufacturer, even if he is a six-foot, bearded "infant," because the cost of production is necessarily higher here than anywhere else. I don't know why it should be. The American workingman used to be able to do so much more and better work than the foreigner that that more than compensated for his higher wages and made him a good bargain at any wage.
Of course, if we are going to agree to give any fellow-citizen who takes a notion to go into some business or other for which the country is not especially adapted,—if we are going to give him a bonus on every article he produces big enough to make up for the handicap he labors under because of some natural reason or other,—why, we may indeed gloriously diversify our industries, but we shall beggar ourselves. On this principle, we shall have in Connecticut, or Michigan, or somewhere else, miles of hothouses in which thousands of happy American workingmen, with full dinner-pails, will be raising bananas,—to be sold at a quarter apiece. Some foolish person, a benighted Democrat like as not, might timidly suggest that bananas were a greater public blessing when they came from Jamaica and were three for a nickel, but what patriotic citizen would listen for a moment to the criticisms of a person without any conception of the beauty and glory of the great American banana industry, without realization of the proud significance of the fact that Old Glory floats over the biggest banana hothouses in the world!
But that is a matter on one side. What I am trying to point out to you now is that this "protective" tariff, so-called, has become a means of fostering the growth of particular groups of industry at the expense of the economic vitality of the rest of the country. What the people now propose is a very practical thing indeed: They propose to unearth these special privileges and to cut them out of the tariff. They propose not to leave a single concealed private advantage in the statutes concerning the duties that can possibly be eradicated without affecting the part of the business that is sound and legitimate and which we all wish to see promoted.
Some men talk as if the tariff-reformers, as if the Democrats, weren't part of the United States. I met a lady the other day, not an elderly lady, who said to me with pride: "Why, I have been a Democrat ever since they hunted them with dogs." And you would really suppose, to hear some men talk, that Democrats were outlaws and did not share the life of the United States. Why, Democrats constitute nearly one half the voters of this country. They are engaged in all sorts of enterprises, big and little. There isn't a walk of life or a kind of occupation in which you won't find them; and, as a Philadelphia paper very wittily said the other day, they can't commit economic murder without committing economic suicide. Do you suppose, therefore, that half of the population of the United States is going about to destroy the very foundations of our economic life by simply running amuck amidst the schedules of the tariff? Some of the schedules are so tough that they wouldn't be hurt, if it did. But that isn't the program, and anybody who says that it is simply doesn't understand the situation at all. All that the tariff-reformers claim is this: that the partnership ought to be bigger than it is. Just because there are so many of them, they know how many are outside. And let me tell you, just as many Republicans are outside. The only thing I have against my protectionist fellow-citizens is that they have allowed themselves to be imposed upon so many years. Think of saying that the "protective" tariff is for the benefit of the workingman, in the presence of all those facts that have just been disclosed in Lawrence, Mass., where the worst schedule of all—"Schedule K"—operates to keep men on wages on which they cannot live. Why, the audacity, the impudence, of the claim is what strikes one; and in face of the fact that the workingmen of this country who are in unprotected industries are better paid than those who are in "protected" industries; at any rate, in the conspicuous industries! The Steel schedule, I dare say, is rather satisfactory to those who manufacture steel, but is it satisfactory to those who make the steel with their own tired hands? Don't you know that there are mills in which men are made to work seven days in the week for twelve hours a day, and in the three hundred and sixty-five weary days of the year can't make enough to pay their bills? And this in one of the giants among our industries, one of the undertakings which have thriven to gigantic size upon this very system.
Ah, the whole mass of the fraud is falling away, and men are beginning to see disclosed little groups of persons maintaining a control over the dominant party and through the dominant party over the government, in their own interest, and not in the interest of the people of the United States!