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Subject Area: Economics
Topic: Free Trade

ESSAY No. IX. - Condy Raguet, The Principles of Free Trade [1835]

Edition used:

The Principles of Free Trade illustrated in a series of short and familiar Essays originally published in the Banner of the Constitution, 2nd ed. (Philadelphia, 1840).

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ESSAY No. IX.

january 30, 1830.

Comments on the bill reported on the 27th of January, to the House of Representatives, by the Committee of Manufactures. Impracticability of a just appraisement of manufactured goods by the officers of the customs.

THE bill reported by the Committee of Manufactures on the 27th instant in the House of Representatives, and which will be found at full length in our paper of this day, under its appropriate title, may be looked upon as the last struggle of the American System for a sickly existence. The manufacturers of wool, after having by the instrumentality of minimums and provisos, secured a protection of from fifty to two hundred and twenty-five per cent. upon their fabrics, under the modest nominal duty of forty-five per cent., and having found that this enormous tax upon the people was not enough to replace the losses incident to their trade, and that no chance existed for the enforcement of a new levy, have now resorted to a scheme, of which the tendency is to throw such difficulties in the way of importations, as will most materially diminish them, if not entirely destroy them. This scheme is in itself so novel in our country, and so fraught with mischief and injustice, that a brief analysis of its features will, we trust, be acceptable to those who are not conversant with commercial details.

By this bill it is required, that all woolen goods imported, shall be taken to the custom-house, and be there examined by appraisers, who shall inspect each piece and determine, without the aid of invoices or of oral evidence, “according to the best of their knowledge and belief, the actual value of each square yard of the same, at the place whence imported.” Now we do pronounce it to be wholly impossible for any man or set of men, to possess such a knowledge of the quality and prices of foreign woollen manufactures, particularily at a time of great fluctuations in the foreign markets, as would enable them to decide upon the cost with that certainty which should exist, when penalties of so exorbitant and tyrannical and unjust a character are proposed to be inflicted. Can it be believed, that a committee of the Congress of the United States should seriously propose to set up the judgment of any two or three individuals, in matters of a nature not susceptible of positive exactness, against the solemn oaths of the most respectable merchants of the country, upon whose integrity the nation has thus far relied for the means of supporting the government and of paying off its debts? Can it be believed, that such a committee would propose to invest such a tribunal, denied the use of the only evidence that could render their judgments worth respecting, with the power of doubling the duties upon whole invoices of merchandise, of confiscating entire packages, and of sentencing the unhappy victims of such cruel and arbitrary decrees to a forfeiture besides of double the amount? And yet this is the substance of the bill. By the third section it is enacted, that the appraisers shall determine the minimum valuation or class to which the goods belong, and consequently, they may decide that a piece of cloth, invoiced at forty-nine cents per square yard, cost fifty-one cents, or that one invoiced at ninety-nine cents, cost one hundred and one cents; the effect of which would be to throw them into a higher class, and thus subject them to twice the duty which they ought to pay. Such sporting with the property of a community might be suitable for countries where commercial honesty and oaths are held in no esteem, but for a land, distinguished above all others for its mercantile integrity and honour, it is as ill-judged and revolting a proposition as was ever before suggested.

Again, if these appraisers, upon the strength of their own judgment, should decide that the value of the goods at the place where they were purchased, is twenty per cent. more than the price at which they are invoiced, absolute forfeiture of the goods shall take place, and beside this, “all legal duties shall be paid, the same as if no forfeiture had taken place.” Now we candidly put the question to any reasonable man: Is it possible for any persons, however skillful in the value of woollen cloths, to decide with the precision which ought to exist where the property of a citizen is at stake, whether an article manufactured in Great Britain, France, or Germany, did in reality cost forty-nine or fifty-one cents, ninty-nine or one hundred and one cents? How could they decide with such unerring precision, whether an article in those countries where sales of bankrupts’ estates upon fluctuating markets are of constant occurrence, cost forty-five or fifty-five cents, ninety or one hundred and ten cents? And yet upon such fallibility of judgment does this bill stake the whole capital of our importers of woollen cloths. The measure is monstrous. It is calculated to deter our citizens from promoting the interests of the country by purchasing their foreign supplies cheap, through fear that by being successful in their speculations, they may be ruined. Look at the case of fluctuations in price at home: The very ground upon which the manufacturers rest their pretensions for this arbitrary measure, is conclusive as to the very fluctuation in prices which is denied to exist by this bill. It is because woollen goods have fallen, that the manufacturers require further restrictions upon importations; and yet upon a falling market abroad, they desire to urge the judgment of appraisers as better evidence of the actual cost of a commodity, than the invoice, supported by the oath of the very man who made the purchase. The whole tenor of this bill is proof of the desperate measures which the manufacturers would gladly resort to, to preserve their monopoly of the home market, and that to accomplish that, neither justice nor respect to private property would be regarded.

But this is not all: The collector of the port, if he suspects fraud, may direct every piece of cloth in an entire cargo to be measured, or, in other words, to be disfigured by the pulling and stretching and unfolding, which would be required for its measurement. This act alone, simple as it is, would occasion a reduction in the value of the cloth of no trifling amount, and beside this would stamp the owner with an infamy which might ruin, most unjustly, his reputation as a fair trader. Let us suppose a case: An American merchant, through his agent or partner abroad, by means of ready money, and a close watch upon the market, happens to purchase an invoice of cloths of the same quality as one for which his neighbour, who imports usually upon credit, is charged by the manufacturers, ten, fifteen or twenty per cent. more. The appraisers decide that the latter price is the true value. Fraud is suspected. Upon measuring one piece it is found to overrun a yard. The suspicion is strengthened, and the measurement of the whole invoice is ordered. An appeal is made to the Secretary of the Treasury, who must naturally rely in a great degree for his own judgment, as to the character of men, upon the officers of government. He confirms the decision, by which the importer, merely because he has had the good fortune to purchase his goods cheap, and to obtain good measure, is punished by the forfeiture of the whole or one half or one fourth of his invoice, upon which he must nevertheless pay duty, and by the disfiguring of his goods; and in addition to this, is branded in his forehead as a smuggler. If it requires a jury of twelve men, in cases not connected with the revenue, to deprive a citizen of his property or reputation, or to decide upon valuations, where property is at stake upon the issue, how unjust is it, that such unlimited power over both, should be given to so irregular a tribunal.

We have not room further to extend our remarks. The bill speaks for itself, and wherever it is read, it will be pronounced, we think, to be one of the most pernicious schemes, as to principle and detail, that was ever devised as an auxiliary to a system of taxing one portion of the people for the benefit of another.