United States and Brazil: how to remedy the depressed condition of our manufacturing & commercial interests. W. P. Tisdel Washington, 1#7 #• Brazil 564 M Xr * "I give thefe Books 818t/or the founding of a College in this Colony" •YAiUE^mviEissjrinf- • iLniais^isy ¦ Gift of Dr. Hiram Bingham of the Class of 1898 1907 UNITED STATES AND BRAZIL: HOW TO REMEDY THE DEPRESSED CONDITION OF OUR MANUFACTURING AND COMMERCIAL INTERESTS. LETTER TO FROM W. P. TISDEL. CT .A. 1ST XJ A. IR. Y 3, 1878 WASHINGTON : K. 0. POLKINHORN, PRINTER. 18 7 8. a fie jfiit>e6idmt o/ #e United i&iaU& : Sir: — I have the honor to address you upon a subject of great importance to the entire people of our country in the hope that your Excellency will take such action in the premises as will tend to remedy the depressed condition of our manufacturing and commercial interests. In January, 1877, 1 had conversation at different times with Mr. John Roach, of this city, touching the subject, of idle capital and unemployed labor, and as to where a mar ket could be found for our manufactured articles, which are so largely in excess of the demand for home consump tion. The labor-saving machinery, brought into use in the United States during the past fifteen years, because of the high price of labor, has flooded our markets with articles of every description, for which there is a limited demand, and the result is shown in the numerous closed factories, the thousands of idle mechanics and laborers, and the generally embarrassed condition of business in all branches of in dustry, and we were convinced that the only remedy for this sad state of affairs, would be the opening of a foreign market for our surplus productions. It was decided that I should visit Brazil and study the wants of our near neighbors, and to ascertain whether or not it would be possible to divert a portion of the enormous trade to our own shores, where it naturally belongs, and in this way revive our shipping and manufacturing inter ests, and give employment to thousands of poor laborers by opening a market for our products, with which would come there-opening of our now idle factories, and a general revival of business throughout the United States. If suc cessful in this project, it would open to our people new sources of trade, with the teeming Argentine Confedera tion, and other contiguous countries. It seemed as though with the improved condition of our financial affairs, we should be enabled to compete successfully with European manufacturers, for a portion, at least, of the trade of this great and growing country, and that, as well as being a great grain and cotton producing country, we stand second to none as a manufacturing people, and that the opening of new channels to foreign markets for our vast surplus, should secure the consideration of American statesmen. With this view in mind, I proceeded to Brazil in the in terests of Mr. Roach, and the success of my mission prompts me to lay before your Excellency facts, which I trust will receive attention at your hands, and pave the way for executive and legislative action — an example set by his Majesty, the Emperor of Brazil — and which cannot fail to bring great good to both the United States and that country. Bearing with me as I did, letters of introduction to some of the most prominent statesmen and business men of the Empire, I was enabled to gain much valuable information, as well as a confirmation of the fact that the commerce of this vast country was monopolized and controlled by Euro peans, notwithstanding, the United States. are her principal patrons, and are abundantly able to supply Brazil with nearly everything she requires, and at rates quite as cheap as now supplied by Europe. I found nine regularly estab lished steamship lines, which make semi-monthly trips, as sisted by long postal contracts for the transportation of the mails between Europe and Brazil, and that the steamships so employed are large and powerful, first class in every re spect, and with an average tonage above three thousand. 2 With a territory of nearly four million square miles, and a population of about twelve million souls, Brazil is to-day on the high road to prosperity with chances of success equal if not superior to any country on the face of the globe. Though it is true that the country is sparsely peopled, the Empire, as will be seen, has five important commercial cities, of above thirty-five thousand inhabitants, as follows : Rio de Janeiro 400,000 Bahia 150,000 Pernambuco 135,000 Para... 40,000 Maranhao 36,000 The following figures will indicate their importance, be ing a table of general imports and exports of Brazil from 1870-1 to 1875-6— Imports in dollars $471,570,589.50 Exports in dollars 577,041,492.00 While during the same period the imports of the United States from Brazil, amounted to $274,148,500.00, and the exports from the United States to Brazil, amounted to only $48,853,555.00. A comparison of the foregoing statement will show %Le mere nothingness of the United States ex ports to Brazil, while the imports from that country in dicate that we are the purchasers of more than one-half her entire exports. Instead of paying for the same in pro ducts of our own, we are compelled to send onr gold coin to Europe in payment for Brazilian produce, and with that gold the supplies for Brazil are there purchased, every arti cle of which, could and should go from our own country, and be of our own production. And why is this ? Simply because we have no regular steam lines from the United States to Brazil. England and France have united in the establishment of steam lines to Brazil, the former paying for the transporta tion of the mails, a mileage of nearly twelve English shil- lino-s, or nearly three dollars per mile, while the latter, with greater liberality than any other country in the world, pays thirty-six francs per mile, or over seven dollars. Ger many and Italy have followed this example, and in every instance large returns to the Governments are made by way of increased revenues. Reverting to the figures al ready presented for your Excellency's consideration, it is not difficult to understand the sharp rivalry now existing among enlightened foreign nations, to procure a fair pro portion of this enormous commercial wealth. Aside from the aid given by the European Governments, Brazil pays an additional sum for the transportation of the Imperial mails, and in this manner the trade of Brazil has been fostered, and the merchant marine of all Europe has become large and powerful, while that of the United States is permitted to decline, and unless prompt action is taken, a restora tion will be impossible. Rich in minerals, and with a soil the fertility of which cannot be excelled in the world ; forrests producing the choicest of woods and most brilliant dye-stuffs ; rivers which flow over the deposit of precious stones, and a climate of every zone ; this great country which know0 neither war nor turmoil, seeks co-operation with us to the end, that a lasting, mutual reciprocity between the two great American countries may be speedily attained. Shall we stand quietly by, the purchaser of nearly two-thirds of her entire coffee product, and not put forth an effort to supply her with the necessaries of life for which there is a growing demand, and thus retain in our own country the gold which now finds its way to Europe, while other Governments assist the enterprise of their people in opening the way to their mar kets by providing the means of inter-communication ? It remains for the Government of the United States to de cide whether or not they will join the Imperial Government of Brazil, and give such preliminary aid and patronage as will support a line until it can become self sustaining, and 5 reflect back again by way of increased revenues, all that may be outlayed from its treasury. Almost this entire business should be transferred to the United States, where it naturally belongs. Our geographi cal position, the vastly superior, cheaper, and safer facili ties for transportation, the greater energy and vitality of the American people, the increasing demand with us for South American products, and agricultural implements, and the mutual friendly feeling which exists and is continu ally increasing between the citizens of the two countries, are a few of the reasons which point to the wisdom of closer relations in the future, but which cannot oe realized with out the temporary aid of the two Governments, by reason of the powerful European grasp upon the trade of Brazil— thus powerful because of the liberal aid extended to steam ship lines by the respective European Governments. Hardly an article is imported into Brazil which could not be supplied by the United States, and yet, Europe is per mitted to hold an almost, absolute control of the import trade, as will be seen from the following statement which I copy from the January number of the "Banker's Maga zine,'" and to which I crave your Excellency's careful atten tion. " Let us see what articles Brazil imports, what propor- " tion is derived from the United States. Among the im ports of 1870-1, were the following : Articles. Value in Milreis. From U.S. ,Milries.* " Boots and Shoes 1,978,979 ... 2,877- " Cod and other fish 1,714,703 ... 74,929 "Butter 2,115,414 ... 13,316 "Cheese 635,481 ... 1,074 "Lard - 268,979 ... 242,463 "Flour 4.257,331 ... 2,880,439 "Tea '623,999 ... 205,419 "Tar and pitch 47,553 ... 2,686 " Gums, resins, balsams, etc 282,591 „. 106,680 " Petroleum, kerosene, etc 1,541,642 ... 1,430,829 " Spirits of turpentine 89,198 ... 69,881 "Perfumery 671,201 ... 181,650 "Pine lumber 284,470 ... 133,742 " Fwniture 250,004 ... 53,873 "Straw hats 606,396 ... VQ7 * Note— Two Milries equal one dollar American currency. 6 " Lime, cement, etc 427,877 ... 9,854 "Coal 5,537.405 ... 197,582 "Earthenware 1,037.334 ... 65 '•Glassware 407,966 ... 24,215 " Gold leaf, jewelry, etc 757,659 ... 380 " Iron and steel 981,427 ... 522 " Iron and steel rails 245,452 ... 5,345 " Other manufactures of Iron and steel 2,818,367 ... 60,617 "Watches f... 369,740 ... 1.800 "Clocks 63,956 ... 33,159 " Railroad cars 76,504 ... 45,542 " Agricultural implements, ma chinery, etc ' 2,374,736 ... 268,688 " Other machinery and tools 1,758,062 ... 319,437 "Umbrellas 375,454 ... " Matches, etc _ 296,316 ... 19,377 " Cotton, cotton fabrics and cloth ing 41,858,359 ... 409,112 " Arms and ammunition 1,179,580 ... 9,008 " Panerfor printing, writing, walls, etc 1,376,426 ... 84,828 " Wool, woolen fabrics and cloth ing 10,337,409 ... 978 " Flax, linen fabrics and clothing. 5,382,425 ... 3,839 " Silk, silk fabrics and clothing.... 2,853,607 ... 10,802 " Chemical products pharmacueti- cal compounds and medicaments 345,419 ... 33,739 " Manufactures of copper and its alloys 825,463 ... 26,528 '• Dyes, varnish, etc 339,801 ... 44,125 " Snuff, cigars, etc 449,524 ... 58,176 " Harnesses, etc 124,093 ... 790 From this incomplete list it will be seen that Brazil re ceives from us in considerable quantities but a few articles, while she has other needs, now wholly neglected by us, which we might supply. Eor instance, why should the Brazilians have to send to Great Britain and France for boots and shoes, butter and cheese, and to Great Britain for cotton cloths ? That there has been but little done since 1870-71 towards entering new fields may be seen from our exports for 1874-5. In that year the chief articles we sent to Brazil were.: flour, worth $4,191,124; lard, $591,708; illuminating oil, $574,307 ; cotton cloth, chiefly colored, $430,066; lumber, $283,787 ; machinery, $268,279 ; drugs, chemicals, and medicines, $127,110. The following are the principal articles exported from Brazil in 1873-4, with their value inmilreis: coffee, 110,172,535; cotton, 23,631,522; sugar, 17,758,557; hides, 11,220,097; India rubber, 10,- 631,829; tobacco, 5,372,242; mate (Paraguay Tea), 2,329,- 712 ; gold and diamonds (chiefly the latter), 2,000,300 ; fa rina (chiefly manioc), 1,898,524; rosewood, 1,424,080; horse-hair and wool, 797,934 ; cocoa, 758,200 ; rum, 472,- 924. The coasting trade of the Empire, being open to for eign flags, is also worthy of note. In 1873-4 the value of coastwise importations was 144,195.971 milries; in 1874-5, 115, 774,949 ; in 1875-6, 96,936,424. We thus find offered to American enterprise a country of vast extent, with a for eign commerce of some $200,000,000 and a coasting trade of more than $50,000,000, which sends abroad raw pro ducts and is dependant upon foreign sources for all sorts of manufactured goods, besides other important articles. Our existing commerce with this country exceeds the not incon siderable sum of $50,000,000, chiefly articles which we re ceive thence, while we permit other nations, notably Great Britain, to supply Brazilian demands which might be met by our factories, dairies and farms. The present moment,when capital is seeking wise investments, when our manufacturers in some branches are underselling the English in their own markets, when public attention, both in Brazil and in the United States, has been attracted by the recent visit of the Emperor, and the Philadelphia Exhibition, to the impor tance of closer relations between the two countries, would seem to be peculiary auspicious to an effort to draw to our selves some portion of the trade with that Empire which now flows in other channels. It rests with our steamship owners, merchants, manufacturers, and capitalists to say whether the opportunity shall be seized or suffered to escape." Having been authorized by Messrs. Roach & Son, to sub mit a proposition to the Imperial Government, in their be half for the establishment of a line of steamships, if in my judgment I should find it practicable, and having in my mind the favorable action of the upper House of Congress upon this subject-matter last year; and finding the great est unanimity of public sentiment in Brazil favorable to such a project; — together with an astonishing change of feeling in our own country, in favor of the re-establishment of our ocean commerce — I beg to inform your Excellency that I did submit a proposition which was accepted, and by virtue of Imperial decree No. 6729, dated November 10, 1877, Messrs. Roach & Son were made parties to a con tract, which was executed on the 14th day of November, 1877, establishing for ten years, a line of steamships to ply between the ports of New York and Rio de Janeiro, calling at Para, Pernambuco and Bahia, the same to go in effect in April next. I found a strong desire on the part of the merchants and business men of Brazil for an extension of trade with the United States, and I also found a most friendly feeling ex isting towards the people of our country, partly because of the cordial reception and kind attention given their beloved Em peror and Empress, during their travels in the United States, and the willingness of the Brazilians to aid in the estab lishment of a line of American Steamships, was ma'de manifest by the prompt manner in which his Majesty, the Emperor, and his able Counsellor, the Minister of Agricul ture, gave me dispatch, favorable notice of which I venture to invite at the hands of your Excellency, believing that the United States will not be backward in joining with Brazil in the consummation of a contract which cannot fail to be productive of great'good to both countries. It may not be out of place for me to inform your Excel lency, that I met with a most determined opposition from the English merchants and managers of English steamship lines, and also, that articles appeared in the daily papers, emanating from Liverpool, calling upon the English mer chants to prevent the consummation of a contract for an American line as " it would be antagonistic to the interests of England." So far has this British opposition reached that a serious effort has been made to prejudice the Brazil ian mind against this country in all conceivable ways, chiefly by endeavors to show that the United States has shut its commerce in by a " Chinese Wall " of commercial legislation, prejudicial and injurious to her neighbors; but happily the surprising spread of education in South Amer ica, justifies the hope that this attempted imposition will not continue after the establishment of closer relations between 9 the two continents, and personal contact between their in habitants. The class of steamships which are now in cours|3fl# con struction for this service at, Gkjg$$, Pen^lvania, w completed, will be equfejfHfot superior, t£,fmylhipi world, not only in the quality of the material used, $ finish and speed, and suh^|tous passenger aecommi which latter will surpasaanything ^hithjerto knownt* Your Excellency wilM|$)g