Tooke on the "History of Prices," as a foundation on which to build the superstructure of his knowledge.

But to make the study of prices of any value we must examine the elements which influence prices. Some of them lie beyond our control, while others are clearly within the reach of legislation. Among the most prominent influences that affect prices are seasons, crops, the foreign markets, facilities of transportation, and the amount and character of taxation and of the currency. All these combine to regulate and determine the prices that prevail in one country as compared with prices in others. "The early and the latter rain," abundance and famine, war and peace in other nations and sometimes in our own are elements beyond our control. But we are responsible for the statutes which regulate trade, transportation, currency, and taxation. It is in our hands to place the burdens of taxation where they will impede as little as possible the march of industry, and least disturb the operation of the great laws of value, of supply and demand.

I stand now where I have always stood since I have been a member of this House. I take the liberty of quoting, from the Congressional Globe of 1866, the following remarks which I then made on the subject of the tariff:

"We have seen that one extreme school of economists would place the price of all manufactured articles in the hands of foreign producers by rendering it impossible for our manufacturers to compete with them; while the other extreme school, by making it impossible for the foreigner to sell his competing wares in our market, would give the people no immediate check upon the prices which our manufacturers might fix for their products. I disagree with both these extremes. I hold that a properly adjusted competition between home and foreign products is the best gage by which to regulate international trade. Duties should be so high that our manufacturers can fairly compete with the foreign product, but not so high as to enable them to drive out the foreign article, enjoy a monopoly of the trade, and regulate the price as they please. This is my doctrine of protection. If Congress pursues this line of policy steadily, we shall year by year approach more nearly to the basis of free trade, because we shall be more nearly able to compete with other nations on equal terms. I am for a protection which leads to ultimate free trade. I am for that free trade which can only be achieved through a reasonable protection.''

While in 1871 the tariff question was again agitated no legislation was enacted. During the following year revenue was decreased, first, by removing the taxes on tea and coffee on May 1, and, second, by admitting large classes of manufactures to a reduction of ten per cent. on June 6.

During this session of Congress the tariff was discussed to a great extent. Among the most notable speakers in the debate in the House were Job E. Stevenson [O.] and Samuel Shellabarger [O.]. Stevenson was, with the possible exception of Samuel S. Cox [N. Y.], the most powerful exponent of "tariff reform," which was clearly indicated as a leading issue in the presidential campaign that was just beginning, and Shellabarger, who, though recognized as the strongest and most thorough-going advocate of Republican principles, had heretofore kept out of the tariff discussion, was led to come forward in support of his party, and to demolish the arguments, not only of Stevenson, but of the great economist, David A. Wells, who had recently made an exhaustive report on the tariff.

It was understood that Mr. Wells had also inspired 'the plank in the platform of the new Liberal Republican party, which, inviting Democratic and Republican free trade adherents to the support of Horace Greeley, a protectionist, declared in favor of taking the tariff out of partisan politics.

PROTECTION AND POLITICS

HOUSE OF REPRESENTATIVES, MAY 1-16, 1872

On May 1 Mr. Stevenson spoke on the inconsistency of protectionists.

The great obstacle to reform is the "hostility" of prohibitory protectionists to moderate measures. These propagandists appear to consider every effort at relief as an attack of an enemy which they are justified in repelling by all means in their power; hence they discard candor and fair dealing, and act upon the maxim that "all is fair in war. tagonists there is no possibility of agreement. weapon of logic and fallacy, fact and fiction. to assert whatever is denied, to deny whatever is asserted, and no proof satisfies them. They maintain contradictory statements and theories in the same speech, if not in a breath, as combatants fight before and behind, at the right hand and the left, caring only to defend themselves or offend their assailants.

With such anThey use every They are ready

Inconsistent as are the arguments of those who advocate the exclusive policy, their practices are more contradictory.

Here the speaker dwelt at length on the contradictory policies of the States favoring the national exclusive theory. Pennsylvania, for instance, in her internal taxation system, laid special taxes on manufactures.

Mr. Stevenson continued:

If we accept the claim of "protection" as the giver of wealth, and begin to cast accounts with favored interests and States to see what they have gained by the policy, its advocates turn about and indignantly deny that it increases the price of protected articles, and denounce those who assert or assume the fact.

If the opposite theory be true, then how can the reduction. or the repeal of duties on imports injure domestic manufactures? And why do manufacturers come to Congress on every rumor of a change of duties? What fills our committee rooms and lobbies and this hall with interested men? What prevents our proceeding at once to adjust the tariff to a revenue standard? If duties do not aid the American producer, surely we should consult the wishes of consumers and the interests of the treasury.

son.

On May 16 Mr. Shellabarger replied to Mr. Steven

I venture to copy the words of my most excellent colleague, Mr. Stevenson, who leads the "revenue reformers" of our party from Ohio in Congress, and say as he said in the great debate of March, 1870, to General Schenck:

"We are much nearer together than you think we are.'

Now let us see if our differences go deeper than to the mere surface, the "incidentals," the matters of differences as to how best we shall get at what we all want-the things "tentative" -and as to which experiment, trial, experience, will, by their teachings, bring us quickly together.

First. Who in the Republican party does not revolt at the idea of making a law that shall confessedly tax out of one man's earnings parts of them and give it to another without giving to the taxed man a pecuniary equivalent of some sort? There is no such man.

Second. Neither is there an intelligent man in the country

who favors protecting interests here which are not "legitimate." That is, nobody is for fostering industries by legislation whose products, owing to the permanent conditions under which they must ever be produced here, cannot be produced without much greater expenditure of human labor than is required in other countries. For illustration, nobody is for what was rendered famous by the epigram of an English statesman, "Making protected wine out of grapes raised in hothouses in Scotland.'

Third. So, on the other hand, no Republican fails to insist that any law which really does have the effect of here creating or augmenting a great and legitimate industry does by necessity bring to every member of the nation other benefits than the revenues it may yield to our treasury, benefits precisely as real and compensatory, as clearly within the cognizance of just legislation, and just as much to be counted in estimating the wisdom of a revenue law or tariff law as is the item of what revenue it gives the treasury.

Among these benefits claimed for a law which really has this effect of creating or augmenting in our country a great industry or industries may be named these: that by adding a home to a foreign competition you secure an ultimate reduction of prices; that the presence in our country of these industries creates a home market for some of the productions of the consuming class, which, owing to their weight, or perishable qualities, or the state or distance of transportation, or the state of foreign custom laws, or the like, he could get no market for abroad. Or the benefit the consumer gets may be in the fact that his lands are enhanced, or his business or profession or trade, by having this country built or filled up with these industries.

Every civilized government in the world, every practical and eminent ruler in our own history, every modern code of commercial law enforced by enlightened states, unite with our own entire and wondrous history in pronouncing it the first duty of government to "protect" as well the industries as the lives and properties of their people.

CHAPTER X

A TARIFF FOR REVENUE ONLY

[PROPOSED WOOD BILL OF 1878]

Fernando Wood [N. Y.] Introduces a Bill in the House for a Revision (Downward) of the Tariff-Debate: in Favor, Mr. Wood, John R. Tucker [Va.]; Opposed, William McKinley [O.], William D. Kelley [Pa.], Gen. James A. Garfield [O.]-Bill Fails to Come to a VoteGeneral Winfield S. Hancock on the Tariff.

Ο

N March 26, 1878, Fernando Wood [N. Y.] reported in the House, from the Committee on Ways and Means, a bill reducing customs duties and reforming the entire system of the tariff. It came up for discussion on April 9.

REFORM AND REDUCTION OF THE TARIFF

HOUSE OF REPRESENTATIVES, APRIL 9-JUNE 4, 1878

MR. WOOD.-It will be remembered that taxation simply consists in imposing exactions for the support of the Government. It was not designed that any other considerations should enter into the discharge of this trust. The burden, whether great or small, was to be borne by the whole people upon principles of equity and equality.

The United States has never had a permanently established system by which to procure revenue and to regulate its commerce with other nations. Nor is this singular in view of the fact that we have been undergoing remarkable changes since our national birth. Within the century of our existence the policy that was desirable at one time would have been very unfortunate at another, and at no time have we been so circumstanced until now that we could adopt political economies purely American. That period has arrived. For the first fourth of our century of life we were emerging from a colonial chaotic