The original of this book is in the Cornell University Library. There are no known copyright restrictions in the United States on the use of the text. http://www.archive.org/details/cu31924013921253 Cornell University Library HF 1755.M48 Oppressive tariff taxation . 3 1924 013 921 253 Sent by mail postpaid to any address on receipt of price.. BOSTON, MASS. : James Means, 41 Lincoln Street. 1885. -I The cause of Tariff Reform will succeed, because the hearts of thousands of workers are in it. The cause of "^protection " will fail, because the only motive for any one to aid it is a selfish one. Copyright, 1883, by James Means. All rights reserved. Oppressive Tariff Taxation. 14 fi 7 b'tr (^.^-s-C ^-^y ^. y /""//'^ Protected Manufacturer. — " Go it, myfinefellvw ; you're doing splendidly / " WoRKiNGMAN. — '■'■This is up-hill work. Protection -may be a good t. ling for me, but I can't quite see how / " TO MY EMPLOYlfis. Some of you were asking me the other day why it was that I thought the system which is called "Protection," an injury to the working-people of the United States. I told you that as soon as possible I would give you my reasons. Here they are : — |HEN "hard times" come, all the consequent suffering has to be borne by the people who are dependent upon their own exertions for a living. Those who live on the interest of their money may be inconvenienced by the lessening of their in- comes ; but while they have their capital to fall back upon, suffering is out of the question. At no time in the history of the world has there ever been a country where the producing classes were prosperous unless that prosperity extended itself to the non-producing classes also ; but there have been many countries where the non-producing classes were prosperous while the producing classes were barely able to keep body and soul together. This being the case, it follows, beyond'a pos- sibility of doubt, that if the object of our Government is to promote the "greatest good of the greatest num- ber," the first object of our legislation must be to pro- mote the welfare of the producing classes. If their interests are guarded their prosperity cannot fail to be shared by the whole people. Bearing this in mind, ft is clearly evident that labor and capital are allies, not enemies; that each is dependent upon the other — that is, when labor is prosperous then is capital, also. "Hard times" are not the result of any one cause, but of a number of different causes acting together. Some of these are more important than others, but if we can surely discover any one of them we are aided in getting ourselves out of the difficulty. What we wish to ascertain now is, whether what cer- tain people are pleased to call a "protective tariff" is a blessing and a help to the people of this country, or whether it is a curse and a hindrance. It is either one thing or the other ; there is no half-way about it. The time for straddling this question has passed by, and the people are beginning to divide already. From what has already been said, it is clear that in deciding the question the only thing which it is impor- tant for us to find out is, What is the effect of a protec- tive tariff ypon the industrial classfes of our country .' The intention of these pages is to make clear to you the following points : — That the system which has been named " Protec- tion for American Industry" has been falsely named, and that the true name for the system is "Oppressive Tariff Taxation." That this system, which taxes the many for the sake of a few, is a system founded upon a mistake. That the movement in favor of Tariff Reform is a patriotic movement. That the movement against Tariff Reform is a t|joroughly selfish movement. That the attempt of the protectionists to oppose Tariff Reform by calling it a " British movement," is based upon nothing. That the remedy for Oppressive Tariff Taxation lies in the hands of the voters of this country. That if they remain victims of this oppression it is their own fault. That it is the duty of every voter in this country to look into this subject, and then to take hold and do what he can to help the cause of Tariff Reform. Let us now consider the matter. The tariff is a tax placed upon imported merchandise. When goods from any foreign country are brought to this country, they must pass through the custom-house of the port where they are landed. A United States official takes posses- sion of them, and in most cases the man who has bought them cannot get them into his possession until he has paid a tax on them — a duty, as.it is called. For example : if you had some friend in Canada who should write you that he could buy you a suit of clothes in Montreal for ten dollars, which would be better than you could buy here for fifteen dollars, perhaps you would like to have him buy the clothes for you and send them to you ; but the United States Government steps in here and says, " No ; you shall not save anything in that way ; we must protect home industry." So when your suit of clothes reaches the custom house, a United States official takes charge of it, and you have to pay about five dollars to the Government before you can have your clothes. This makes your suit cost you about fifte^ dollars, when otherwise it would have cost you only ten dollars. The Government says to you, " If you try to buy where you can buy the cheapest we will tax you so dearly that you shall not save a cent by it." Now, there is'what is called a "free list" — that is, there are some kinds of merchandise that can come in free of tariff taxes ; but the list is comparatively small, and what has been said about the duty on your clothes applies to nearly all the necessaries of life : they are almost all taxed by the tariff. The trouble about this tariff tax is, that the people are taxed without knowing it. That is the reason why they have quietly borne the oppression so long. In the same way that you are taxed on your clothes you are paying thousands of taxes without being aware of it. Your iron and steel implements, your cotton goods, your woolen goods, your carpets, your stoves, your tools, your blankets, your crockeryware, your nails, your glassware, your soap, your molasses, Etfid thousands of others of your necessaries of life, are taxed ; and while you pay the taxes, you oftentimes do not realize that you are being taxed. Some one may say that your goods are not taxed, because they are, some of them, made in this country ; but look at it for a moment. If the Govern- ment says you shall not buy a ten-dollar suit in Canada without paying a tax which makes it cost you fifteen dollars, and if, on that account, you buy a suit of clothes here at home, and pay the full price of fifteen dollars, do you not see that you are taxed five dollars in either case, because the United States law makes you pay ' fifteen dollars for what you might have bought for about ten dollars? Now, before I go any further, let me say one word about the illustration I have just given; There are certain people who are very anxious to pick flaws in the arguments of those who are in favor of tariff reform, and it is sometimes well to answer them in advance. The suit of clothes is only one illustration which shows how you are taxed on thousands of commodities. But some one may say that I have not been correct in my statement about the cost of clothes in Canada. Well, if my figures should not be found exact, what then? The point is this : if between this country and any other country there is a difference in price of any goods on which there is a protective duty, then that duty is a tax upon the home article, which you have to pay when you purchase the goods. But if, on the other hand, the price of that kind of goods is as low here as anywhere, then there can be no need of any protective duty, because no one will send abroad for what can be bought as cheaply at home. Now we are coming directly to the question we have to consider. I have said you are burdened by tariff taxes on most ' of the necessaries of life. The American people will never complain of a just tax ; but when they are once made to see that they are taxed unjustly, they rebel against it. The conflict between protectionists and tariff reformers is just here : — For what purpose shall the people be taxed ? Protectionists claim that the taxes we are talking 8 about should be levied for the purpose of protecting individual industries, and that people shall be made to pay these taxes, no matter whether the Governmerit needs the money or not. Tariff reformers, on the other hand, believe that it is inexpedient to impose upon the people any taxes, direct or indirect, except to meet the expense of an economically administered government. Do you see the difference clearly .' The protectionist says : " Throw up a barrier around our country, and do not let the people buy their neces- saries of life in the cheapest market ; tax them so heavily that they will have to buy at home, no matter whether the money raised by taxation is needed by the Government or not, no matter whether the tax is just or unjust ; no matter about anything except to prevent foreign goods from coming to our shores." On the other hand, the tariff reformer says that it is inexpedient for the Government to impose a tax upon the people unless to raise money needed for a revenue ; that it is inexpedient for the Government to take money out of the pockets of one class for the purpose of put- ting it into the pockets of another class. The Government must have a revenue. That rev- enue must be raised by taxing the people in some way or another. Probably for years to come the best way to raise that revenue will be, in part, by means of the tariff. So let it be. But what shall we say of the pro- tectionists .' They have taxed the people of the coun- try by their high tariff so that they have filched from their pockets a surplus of one hundred million of dollars per annum On the tariff question the voters of this country are divided into three classes. The first class is composed (?r protectionists. It is a very small class. The second class is composed of the tariff reformers. This also is a small class, although it is probably larger in number than the protectionist class. The third class is the largest. It is composed of the people who are unde- cided either way, but are looking for the light, and are open to conviction to the truth. These people are anxious to get all the information that they can ; they are willing to consider the matter fairly and candidly, in order that they may have intelligent opinions of their own. It is to this class that I am writing. I am not addressing protectionists — it is useless to waste words upon them. Part of them know the falsity of their pretenses, and the other part have been brought up to believe thait what is false is true. When you argue with them they dodge every point ; when you drive them into a corner they talk about irrelevant matters. Here let me say, that we all know men of high character who sincerely believe that " protection " is necessary to our national prosperity. These men are generally either directly or indirectly interested in the manufacture of certain protected goods, and they think that any lowering of the tariflf would bring ruin to the business in which they are interested, and to the operatives engaged in it. They are men who have studied the interests of one class of labor so long that they do not realize how much smaller that class is than the mass of unprotected people who are burdened by lO tariff taxes. Moreover, tariff reformers do not admit that in reducing taxes any wide-spread distress woul^^ come even to those engaged in protected industries. These protectionists do not realize that war taxes are ' unnecessary in time of peace. If they would give up thinking always of the past, and would consider the present and the future, I believe that many of them would come to favor tariff reform. But among pro- tectionists such men are in the minority. Now let us see what excuses the protectionists have to offer for advocating the levying of a tax to raise money which the Government does not need. The principal argument — or rather statement, for it is not an argument — which they bring forward is this: they say that a high tariff protects the workingman from competition with the pauper labor of Europe ; they say that the high tariff has made the wages of the American workman higher than those of the foreign workman, and that the protective tariff is the cause of a large measure of the prosperity which this country has seen. This, as I say, is not argument ; it is merely assertion. We ask them to bring proofs that their assertions are true, and they make no attempt to prove the truth of them ; but they simply reiterate their original assertions again and again, putting them first in one form, then into another, mixing in with them false statements and all kinds of misrepresenta- tions in order to deceive the working-people into thinking that the oppressive tax is a good thing. Now, we tariff reformers are thankful to say that wages are higher in this country than in foreign coun- 1 1 tries ; but that the tariff has made them so, we deny, and we are prepared to disprove the truth of the pro- ^ctionists' assertions. Think of it for one moment. I think I can make the matter perfectly plain. Suppos- ing, for the sake of argument, that trade between countries had always been absolutely free. What would be the condition of the people, in this country now ? Would they be no better oflf than in other coun- tries ? You know that they would. You know that with millions of acres of marvelously fertile soil, the people must be richer than in countries that are not blest as our own is. You know that with our bountiful stores of iron, of copper, of coal, of precious metals, and thousands of others of nature's best gifts to man, such as no other country has ever had, it always must be easier to get a living in this country than in others. You know that the geographical position of our country virtually gives us a whole hemisphere to ourselves, and makes it unnecessary to support an immense standing army to keep ourselves out of trouble with neighboring countries ; and you know that the working-people must always be richer in this country, where they are not taxed to support a large standing army, which produces nothing. And when you consider our free government, the education of our masses, the superior productive- ness of American labor, and all the natural wealth which has been given us, it becomes quite evident to you that in these things lie the secret of our prosperity as a nation. But the protectionists ignore these things ; they are trying to throw dust in your eyes, and they are trying to delude you into thinking that this pros- 12 perity, which has come to us from nature's gifts and an enterprising population, has come from tariff taxation^j^ To bring down the question of protection to its sim- plest terms, " it is robbing Peter to pay Paul." There are in our country about seventeen million of people engaged in gainful industries. An analysis of the statistics shows that the really protected working- people in this country number less than one-fifteenth of all the workers in the country. The other fourteen- fifteenths — that is, over fifteen million — are taxed to benefit the other one-fifteenth. The tariff is of no benefit to the thousands of opera- tives who are engaged in making machine-made shoes, or to nineteen-twentieths of our farmers and agricul- tural laborers, or to railroad employes, or to sailors, or to commercial people, or to carpenters,'_masons, painters, glaziers, gas-fitters, paper-hangers, teamsters, drivers, machinists, blacksmiths, printers, clerks, or thousands of others that I might mention ; and yet you are all craftily and outrageously taxed to protect a few manu- facturing monopolists. Those very monopolists who clamor most loudly for protection are the ones who dis- charge their workmen by hundreds, and who import cheap labor from other countries to fill their places. Who believes that the people of this country can be benefited by needlessly taking away from them a part of their earnings? Do you? When people are taxed it takes away from their earnings and from their purchas- ing power. Tariff reformers, or those who believe in a tariff for revenue only, hold that a tax is an unfortunate 13 thing at best ; and yet the Government must have a rev- alue to carry it on, and the tariff reformers are willing fliat the tariff should pay a part of that revenue. But here your protectionists stand up, and actually have the hardihood to claim that a tax is a good thing ; that it is a good thing to take away from the earnings of the people ; and that they will not only take from your earn- ings what the Government needs, but they will take more — they will take what the Government does not need, and what they themselves acknowledge it does not need. And what reason do they give for this ? They say that if we tax the whole people, that taxation will enable a part of the people to earn more wages than they would otherwise ; that is, they acknowledge that they are rob- bing Peter to pay Paul, and they defend themselves by saying that Peter has his loss made up to him.^ Who is Peter, and who is Paul ? I will tell you first who Paul is. He is the man who is, as they say, "protected ; " that is, he is engaged in making some kind of goods that can be made cheaper in some other country than they can be made here. Protectionists say to him, " Paul, the British Lion is after us, and if the duty is reduced on the goods that you are making he will swallow up our industry with one gulp ; he will flood our market with goods so much cheaper than you can make them that you will be thrown out of employment, and perhaps starve to death. By the way, Paul, when you vote, re- member the British Lion, and see that you vote for a protectionist." And who is Peter ? There are about fifteen million 14 Peters in this country. They are the people who are engaged in pursuits which are not benefited by prote(^ tion, and yet who are obliged, by tariff taxation, to pa!y' higher prices for their necessaries of life in order that one million or so of Pauls may, as they say, get higher wages. That is why protection does not protect, — because it robs Peter to pay Paul ; because it taxes the many for the sake of the few ; because it puts its thieving hand into the pockets of a large class of people, and takes from their hard earnings to give to a small class of people. Which would you prefer, to earn two dollars and a half a day, clear, or to earn three dollars, and out of it pay seventy-five cents daily tax, leaving you two dollars and a quarter per day ? I think you would prefer to earn the former. But supposing some one comes along and says, " Look here, you had better take the three dollars a day and pay your tax of seventy-five cents without making a fuss about it, because, my friend, the country will be so prosperous that what you pay in tax will be more than mad6 up to you in other ways." Do you listen to him ? No. You tell him you would rather have two dollars and a half a day sure, than to have two and a quarter with something additional in doubt. Protectionists say that the taxes you are paying are more than made up to you again ; but the man to prove that assertion has not come along yet — and he never will. Protectionists say that the object of a high tariff is to protect home industries, and so benefit "the poor work- ing-man." Have you ever noticed that when a man has a political axe to grind he always becomes a philan- thropist, and sets himself up as the "working-man's friend ? " i5 What protectionists are trying to do is to continue a ^stem of taxation which taxes the whole people, to keep anve a few industries that will not pay unless they are " protected." If any industry will pay in this country it needs no protection. If it will not pay, can you see any reason why the people should be taxed to make it pay f A high tariff is a stimulant. It is artificial ; conse- quently it may keep a certain portion of the community engaged in industries which are less profitable to all concerned than some other industries would be. To admit that any industry needs protection after it is once well established, is an admission that for natural rea- sons some other country is better fitted to carry on that industry. Protectionists claim that there are many industries now protected which would decline under a revenue tariff. Tariff reformers do not believe that. But granting it to be true, for the sake of argument : then the protectionists hold to the shameful idea that it is wise and just to tax the people in order that certain members of the community may be kept at industries which they can follow only at a disadvantage, rather than that the decline of those industries should cause them to engage in some others, for which their nature, circumstances, and surroundings better fit them. If any industry should decline under a revenue tariff, — which is to be doubted, — then labor and capital would be forced into some other channel where they could be more profitably employed. If protectionists are right in thinking that certain industries would decline under free trade, then the process of changing labor into new i6 channels would be temporarily painful to a small frac- tion of the people. Upon this conclusion, drawn frot^ a false premise, rests the whole flimsy argument l^' which the protectionists attempt to justify themselves in oppressing the people by taxes to raise money which the Government does not need. A protective tariff causes depression in business by interfering with the laws which govern trade, and throwing things out of balance. Much of the suffering among the operatives engaged in the iron industry in various parts of the country is directly traceable to the evil influence of the tariff. It will not be difficult to show why this is so. It is evident to any thinking man, that any industry will run' with fewer "ups and downs" when the pro- ductive capacity is gauged to supply an average demand. It is impossible, of course, to avoid fluctua- tions in the state of the market ; but still, the more nearly the supply and demand counterbalance each other the healthier the state of trade. A short supply encourages overproduction. One reason why iron operatives are suffering at pres- ent is because the tariff has encouraged more men to go into iron mills than can earn a living at that industry. A few years ago there was a period of great activity in railroad building : this caused an excitement in the iron market, and an enormous increase in the demand for iron. Had it not been for the high tariff, foreign coun- tries would have helped to supply the demand for iron in this country; but the influence of greedy iron corpo- 17 rations kept the tariff up, and shut out foreign iron, thus ^rning a large amount of labor into a channel where n could only hope for employment while the boom lasted, and leaving it to starve when the boom was over. If it had not been- for the high tariff", labor would have gone into other channels. This is only one instance of hundreds which may be cited to' show how the protective tariff" helps to cause depression by throwing things out of balance, and by interfering with the natural laws which tend to keep trade in a healthy condition. Our own industry (boot and shoe manufacturing) has suffered less than some others by the recent depression in business. One reason for this is, that we are blessed by having hides come in duty free. It is indeed fortunate for us that hides have escaped tariff" taxation, in spite of the advocates of protection. Hides bear the same relation to our business that pig-iron does to the iron manufacturing business, and that wool does to the woolen manufacturing industry. There is just as much reason why pig-iron and wool should come in duty free, as there is that hides should be untaxed. Your clothes are taxed, and everything that you use containing iron is taxed. For what .' To " protect home labor." Are the protectionists honest in stating that that is the ob- ject of the high tariff"? If they are honest they are ig- norant ; if they are not ignorant they are deceitful. These are strong statements ; let us see if they can be supported. Consider the case of pig-iron. The advocates of the tariff" on that commodity claim to be anxious about the i8 condition of the iron-miners. The pig-iron protectionists have had their own way, and if protection is good for an\^ thing, you naturally would expect to find the miners livilig in a comfortable way. Surely a " protected iron-miner " ought to be an object to which the protectionist could point with pride ! Look at him in Hocking Valley — a poor, starving specimen of humanity, with rags on his back, and hardly a crust of bread for his famished chil- dren ! Look at him in Pennsylvania — a miserable wretch, discharged by his protectionist employer, who has im- ported a large gang of foreigners to work for fifty cents a day ! The protectionist employer does not have any duty to pay on his imported labor, and yet he advocates " protection " for the poor working-man ! The working-people of this country must expect to be poor and wretched if they are willing to baled by the nose by the protectionist hypocrites who pretend to befriend them. This "protection" is all a sham, to the very core. It has never done any good to the people of this country, and no sound argument in its favor has ever been brought forward by its advocates. It is made up of nothing but hypocrisy and ignorance — mostly of the former. In these last few pages I have fallen into the habit of protectionists, and have given you assertions instead of arguments. There ar,e certain times when argument becomes unnecessary. It is not well to trust to asser- tion entirely, as protectionists do ; but sometimes it is not out of place. One more assertion : Protectionists say that tariff reformers are favoring a British policy, and that they are working to favor England at the ex- 19 • pense of America. This assertion can properly be met ^y a counter-assertion. When protectionists say that ^riff reformers are working for British interests, they say what is false, and what they know to be false. The reason they resort to this falsification is, because they think that they will thereby gain votes. The truth about the matter is this : our nation, being the greatest on the face of the earth, is able to take care of herself, and has no need to fear England or any other nation. England would undoubtedly be glad to have more opportunities to exchange com- modities with us ; and as we shall gain by it, it makes no difference to us whether England is pleased or displeased. When one man sells another a good horse, he wants the money more than he wants the horse, and the man who buys wants the horse more than he wants the money. Both are better off than they were before the trade. So it is between nations : when they trade, it is better for each. But protectionists are trying to make you think that just because England is glad to exchange commodities with us, it must be a bad thing for America. If protectionists are not falsifying when they say that tariff reformers advocate a " British policy," then they must hold the opinion that, as a rule, in every transaction some one gets a bad bargain. But even protectionists are not so foolish as to think this. Protectionists say that the object of high tariff taxation is to protect the laboring-man. Those who are most active in advocating oppressive tariff taxes are either capitalists, who have money invested in protected industries, or else politicians, who think they can get 20 more votes by pretending to protect the working-people, or else men who, while quite honestand sincei-e in the wish to befriend the working-man, have yet had thetr attention and experience so wholly confined to the interests of one class, that they are unable to take a broad view of the subject. The majority of protection- ists do not care a penny for the welfare of the laboring- people, except for what they can get out of them. The only " protection " which the American working- man needs is " protection " from the Government which now grinds him down with needless taxes upon his necessaries of life. When our labor is relieved of these taxes, its products will be so reduced in cost as to be salable in the markets of the world, and our unem- ployed labor will find work. But while the oppression remains, thousands must be idle, because our goods are shut out from foreign markets by the wall which pro- tectionists have built around our country. TariflF reform must be accomplished not suddenly, but slowly and cautiously. Free trade should be the goal ; but if we try to reach the goal too soon we run into danger. Great as is the evil of a high tariflf, we have had it so long we can only abandon it by feeling our way step by step. But let us move as rapidly as we can without giving a shock to our industrial system, and let not the selfish hypocrites who complain of all " tariff tinkering," be trusted with the task of reforming the tariff. Their past deeds condemn them. Their promises have proven falsehoods. JAMES MEANS. 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