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Subject Area: Political Theory

GALLATIN TO J. Q. ADAMS. - Albert Gallatin, The Writings of Albert Gallatin, vol. 2 [1879]

Edition used:

The Writings of Albert Gallatin, ed. Henry Adams (Philadelphia: J.B. Lippincott, 1879). 3 vols.

Part of: The Writings of Albert Gallatin, 3 vols.

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GALLATIN TO J. Q. ADAMS.

No. 162.

Paris, 22d September, 1820.

Sir,—

I had the honor in my despatch of the 19th instant to state the reasons which would have induced me to agree to a reduction instead of a total abrogation of discriminating duties. It was not without much hesitation that, knowing precisely the President’s intentions in that respect, I had come to that determination. It is perhaps better that the question whether it is proper to depart in favor of France from the principle we have tried to establish in our commercial relations with all other nations, should be decided at Washington. But if decided in the affirmative, what is the maximum of duties to which the United States may agree without danger? The first principle on which I would have insisted was that of a perfect nominal reciprocity; that is to say, that the discriminating duty, whether laid on the bulk or on the value of the articles, should be the same in the United States and in France. Although the great difference in the bulk of our exports and imports makes that reciprocity but nominal, it seems important not to depart from the principle, for the sake at least of preserving appearances both with France and with other countries. As freight is the object, the quantity of each article which a vessel can carry per ton is the true basis to which we ought to resort. But as the rates of duty, if laid on the weight or capacity, must vary according to the bulk of each article, and there might be great difficulties in agreeing to so many distinct rates, I had thought that an uniform duty on the value of the article would be more easily attainable, and would in practice be sufficiently correct.

Upland cotton being the chief article of our exports to France, I had taken it as the basis of the calculation. From the best information I could collect, I thought that our ship-owners might at this time stand the competition of the French, even if these had a premium not exceeding one-third of a cent per pound. But on this, which is a question of fact, you may apply to the persons concerned in that trade, and who can alone say to what extent they are willing to allow that premium to French vessels rather than that the present state of things should continue.

Taking, then, 22 cents as the maximum of the price of upland cotton, I had concluded to accede to an uniform duty of one and a half per cent. on the value of all articles at the place where laden as the maximum of the discriminating duty to be laid by France on American produce imported in American vessels, and by the United States on French products imported in French vessels.

You may easily make the calculations necessary to show what this duty would amount to on the principal articles of our exports to France, taking it as a basis, which I believe to be tolerably correct, that our vessels carry on an average per ton 380 kilogrammes of cotton, 800 kilogrammes of tobacco, and 1000 kilogrammes of rice or potash. I think also, from the best data in my possession, and which may be rectified at home, that our annual exports to France in those four articles, reduced to American weight, amount to about,

24,000,000 pounds of cotton, of which not more than 6 or 700,000 pounds consist of sea island (long staple).

8,000,000 pounds tobacco, chiefly first quality, part of which is, on account of the system adopted by the régie in their purchases, imported from England.

8,000,000 pounds of rice.

4,000,000 pounds potash and pearlash.

Compared with the heavy discriminating duties heretofore laid by France, the reduction would indeed be very great, since, rating the upland cotton at 20 cents per pound, the duty would be only 3 francs 5 centimes per 100 kilogrammes, instead of 16 francs 50 centimes, the present duty.

But the premium would still be, by my calculation, on an average of all our exports, about 2 dollars and 30 cents, or 12 francs 35 centimes, per ton, which is about 16½ per cent. on the ordinary price of freight, estimated at 14 dollars, or 75 francs, per ton. I am perfectly satisfied that this is amply sufficient to compensate any superiority which our navigation may still have over that of the French, and that with economy and the removal of some restraints laid by their own government, they may within a twelvemonth navigate between the two countries on as cheap terms as ourselves. I would have thought it, therefore, indispensable to introduce a clause leaving it optional with either government to annul the agreement on giving due notice to the other party.

The substitution of an uniform duty of 1½ per cent. on the value to our present discriminating duties would have made no important difference on goods which now pay duties ad valorem, but, rating wines imported from France in casks at 2 francs and brandy at 2 francs per gallon, it would reduce our discriminating duty on wines to one-half and that on brandy to one-sixth part of what it is now. France could not, therefore, object that the proposal was not reciprocal, and that result would, I am confident, have been acceptable to the commercial interest of Bordeaux and other southern ports.

Whether considerations of a different nature should induce still greater concessions to France, it is for the President to decide; but I beg leave to submit an observation to your consideration. I believe that I know enough of this government to assure you that it would be extremely difficult to make them agree to a proposition which had been once explicitly rejected by their minister. If, therefore, you perceive that Mr. de Neuville’s proposals or views are such as to forbid an expectation that you can at the moment conclude a satisfactory arrangement with him, I would think it important that your proposals to him, and which he would of course reject, should fall short of your real ultimatum, reserving this for a more favorable opportunity, which will very probably occur as soon as this government is satisfied that you will not accede to their first demands. But even then their pride or vanity must be saved, and something different from what they shall have rejected be offered to them.

From what has been hinted to me, I suspect that it is intended, in case you should not agree to the demands of this government, to propose to you a provisional, or rather a preparatory, arrangement; that is to say, to reinstate things, with perhaps an insufficient modification of duties, to the situation in which they were prior to the Act of Congress of the 15th of May last, under an expectation that a more satisfactory arrangement will afterwards be made. There may be reasons to assent to this, rather than the commercial relations of the two countries should continue in their present state; but I think that you may with certainty calculate that, in that case, you will obtain nothing more than will have been thus agreed on, and that the expectation held out of something more satisfactory being afterwards assented to by France will not be fulfilled.

If you cannot make any satisfactory arrangement, it will be necessary to inquire through what channels the commerce between the two countries will be carried on. There can be but three,—foreign vessels, foreign places of deposit, and direct intercourse in spite of the heavy duties on both sides.

In the present state of things, there is no doubt that the importation of our produce into France will almost exclusively be made by British or other foreign vessels. They pay 38½ francs per 100 kilogrammes of cotton. The same article, if imported into France from Great Britain or other foreign European ports in French vessels, will pay 33 francs. That difference is not sufficient to compensate for the expenses of a double freight (from America to England, and from England to France) and those incurred at the European port where the cargoes must be unladen and reladen. It must be added that I am well assured that the French ship-owners are taking measures for obtaining foreign papers for their vessels. I should not be at all astonished that this government should wink at this, and permit such vessels still to enter their ports as French; in which case our laws would be evaded and the trade be carried on exclusively by the French. I think it therefore indispensable, if we mean to persevere in the present plan, to prohibit altogether the exportation of our produce to France in any other than American or French vessels. There is nothing in any of our treaties to prevent this being done. With proper explanations, no nation could take offence at it; and, although it would disappoint some ship-owners here, I may venture to say that the measure would be popular even in France.

We might also with great facility prohibit the exportation of our cotton to Florida and to any of the West India islands; and this would be very advantageous if it should not provoke France to prohibit its importation from any European port. Whether, considering on one hand the expenses to be incurred in a double freight from the United States to the West Indies, and thence to Europe, as well as the expenses in a colonial port, and on the other hand the difference of 22 francs per 100 kilogrammes (resulting from the French duty and premium) in favor of this mode of importation, our ship-owners can stand the competition and send their produce here by way of England or other European places of deposit, I cannot positively say; and I think the most intelligent of our merchants should be consulted on this point. In favor of the prohibition it may be said that, if Congress does not adopt that measure during the next session, this government may nevertheless prohibit the importation from European ports if they find that the competition through that channel is fatal to the plan of American places of deposit. But I still think this a doubtful question.

Should the importation be prohibited, as well through foreign ports both in Europe and America as by foreign vessels, the commerce may still be carried on by a direct intercourse. But in that case it would, under the existing rates of tonnage and other duties, exclusively fall in the hands of the French; since their vessels (exclusively of our discriminating duty on their inward cargoes) would pay in our ports only 18 dollars per ton, and ours would pay in French ports the new tonnage duty of 99 francs, and about 65 francs per ton on account of the old discriminating duty on their cargo, making about 30½ dollars per ton. It would in that case again be necessary to lay a new duty of 12 dollars per ton in order to restore equality; and this government would probably by an ordinance again re-establish an inequality in their favor. I therefore think that if no arrangement is made, it will be necessary that the President should be vested with some discretionary power in that respect.

But we never will be placed in an eligible situation towards other nations, and in one that may enable us to treat upon an equal footing, until an amendment shall have been obtained to the Constitution which will permit Congress to lay an export duty on articles exported in foreign vessels. Then, a general law laying on such exports a duty always precisely equal to that which is laid in the foreign country on similar articles when imported in American vessels beyond what is levied on the same articles when imported in vessels of that country, will relieve us from every difficulty of the nature we now experience.

I have fairly stated those which we have to encounter in case you should fail in making an arrangement, and they have certainly much weight. It must, however, be recollected that the inconvenience is at least as great on the part of France, that the shipping heretofore employed in our trade lies now idle, and that, whatever they may say, they do want at least our cotton and tobacco far more than we do any of their manufactures or products. On tobacco there can be no doubt; and you may rely upon it that there is no substitute for our cotton without their manufactures being materially injured. That of Brazil is too dear, and that of the East Indies too inferior; besides which, they do not understand how to clean this without great loss, and it cannot be imported with any benefit except when ours exceeds that of 20 cents per pound.

I have the honor, &c.