Front Page Titles (by Subject) ESSAY No. LXV. - The Principles of Free Trade
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ESSAY No. LXV. - Condy Raguet, The Principles of Free Trade 
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. LXV.
november 3, 1830.
The boasted exports of cotton fabrics, to the East Indies and China, shewn to prove nothing as to our ability to undersell the British in foreign markets.
THE following articles have been copied into a number of papers, and will no doubt go the rounds:
From the Boston Daily Advertiser.
Theory vs. Facts.—The opponents of the American System have predicted that it would work the speedy destruction of our commerce and navigation—and they will now quote you chapter and verse from all the writers on free trade, to prove it. Within the last three months, some thousands of tons of merchandise have been imported in our ships from Calcutta, three fourths of the bulk of which consist of raw materials for the use of our manufactories in this vicinity, and upon which the ship owners have pocketed a freight of from twenty-five to thirty dollars per ton, and the importers twenty to forty per cent., profit—and, what is more to be noted and wondered at, a part of these very cargoes have been paid for by our cotton manufactures sold in Calcutta at a profit of from 15 to 25 per cent. The instances of profitable shipments of our coarse cottons to India are not one or two, but many. The intrinsic superiority of our “domestics” to the “India cottons,” is now almost as well understood and appreciated by the natives of Hindostan as by those of New England.
If there yet remain amongst us any who would advocate the policy of “keeping our workshops in Europe,” let them remain as monuments of the safety with which errors in theory may be tolerated, while reason and such facts are at hand to refute them. But beware how you allow their theories to be brought into practice!
You will soon have an opportunity of seeing the practical result of one branch of the “free trade system” in the opening of the British West India ports. English shipping will again become most troublesome competitors—and your sagacious Yankee ship-owners are already hesitating as to the propriety of shouting, quite so loudly, hosannas, in praise of this “masterly achievement in diplomacy which is to place the administration in another blaze of glory.”
From the Salem Gazette.
“Salem.—Carrying Cotton to Calcutta.—It is but a few years since this action would have been deemed no less absurd than that expressed by the corresponding phrase of “Carrying Coal to Newcastle;” yet it bids fair to be soon one of frequent occurrence. The ship Rome, of this port, belonging to P. Dodge, Esq., on the outward voyage from which she has just returned, carried about 300 bales of American cotton cloths, which it is well understood paid a high profit in Calcutta. Those whose memory extends to the very recent period when the trashy cottons of India, with their uncouth nomenclature, filled our market, will hardly be able to realize that the natives of Bengal are now dependent upon foreign countries for the cotton with which they are clothed—but it is true. The manufacture of cotton has almost ceased there, and is now confined to the production of a few goods of the very coarsest kind, their wants being principally supplied from Great Britain. The steam-engine allows no competition of human labour.
American cottons find a ready market in the island of Madagascar, where they are a favourite article. Many bales have been sent to that quarter by our Salem merchants, who have found their account in it.”
The foregoing accounts are highly flattering, and will no doubt be considered by many who read them, as conclusive on the subject of our ability to export largely of cotton manufactures. We, however, are somewhat sceptical on this point. Although we know, and admit the fact, that since the improvements in labour-saving machinery which have been made in Europe and in this country, within the last fourteen years, have superseded in a great degree the manual labour previously applied to the spinning and weaving of cotton, and have reduced the cost of manufacturing the coarse qualities to a fourth or less of the former expense, yet we are very far from believing that the manufacture “has almost ceased” in India, “and is now confined to the production of a few goods of the very coarsest kind,” or, that “the natives of Bengal are now dependent upon foreign countries for the cotton with which they are clothed.” The reasons why we are sceptical upon these points, notwithstanding the high authority quoted above, founded no doubt upon what was supposed to be good testimony, are the following:
First. It is impossible that so great a revolution in the industry of so numerous a people as the inhabitants of Bengal, could have taken place in the short space of fourteen years. Prior to that period, India supplied a considerable proportion of the cotton manufactures consumed by the inhabitants of North and South America, the West Indies, and Europe, besides all her own population; and to make good the positions above laid down, it ought to have been shown, by reference to some authentic documents, from what countries she now derives her supplies. If she derives them from Great Britain, as asserted, she must pay for them; and the imports from India into Great Britain would consequently show a gradually increasing amount. To ascertain how this fact is, we have not at hand the necessary documents to refer to, but we have a table before us, which gives the following statement of the value of all the merchandise imported into Great Britain from the East Indies and China, in the following years:
This certainly does not look much like a gradually increasing export from India, at least up to 1823; but even admitting a very considerable one since that year, how plain is to be seen the improbability of its having amounted to any such extent as would warrant the assertion of the wants of the population of Bengal “being principally supplied from Great Britain.”
Secondly. It is well known that the improvements in labour-saving machinery which have made the great revolution in the cotton manufacture, are chiefly applied to the coarsest goods, and not to the finer qualities; and, consequently, the position that the Bengalese are driven out of the manufacture of the latter, and can only find their account in making the former, is not reconcileable with sound philosophy. The contrary effect ought, in the natural course of things, to have been produced, and we presume has been produced, as far as the cotton manufacture of India has been influenced by these improvements. In the year ending on 30th September, 1828, there were imported into the United States from the British East Indies, white, printed, and coloured cotton goods, to the amount of 105,799 dollars, and in the year ending Sept. 30, 1829, to the amount of 45,153 dollars. Will the Salem Gazette say, that these were the coarsest species of goods? We think not; or else our merchants who exported coarse goods must have been committing a great folly, for a profitable trade could not have been carried on both ways in the same article.
Let us now examine the position respecting the “many” profitable shipments of our coarse cottons to India, the superiority of which, in the opinion of the writer in the Boston Gazette, has become “now almost as well understood and appreciated by the natives of Hindostan, as by those of New England.” In this assumption, we think the correspondent of the Gazette has been just about as much mistaken, as the Constantinople correspondent of the same paper, whose letter we examined in our last, was, respecting the consumption of cotton fabrics by the Turks. To enable the population of Bengal, or indeed any considerable portion of them, to become intimately acquainted with our “domestics,” would require no inconsiderable shipments, even to afford samples. Now let us see whether such shipments have been made. The first accounts of the export of cotton fabrics, separate from other manufactures, were kept by the Treasury Department in 1826, prior to which year the exports were not considerable. Upon reference to the official documents, we find that the exports of white and printed and coloured cottons to the British East Indies, were as follows:
Here we have, to be sure, a pretty quantity of domestics, to exhibit so extensively amongst so many millions of people, as to enable their superiority to become “almost as well understood and appreciated” by them, as by the shrewd population of New England. The position really must have been advanced through inadvertence.
But perhaps we shall be told, that the “many” shipments alluded to, were first made to other ports, and from them to Calcutta. This is an argument, and we will see how it will hold out. For the purpose of giving a fair chance to the respectable writers whose positions we are combating, and who we are quite sure would make out a better case, if they were only on the side where they properly belong, we have examined the official documents, and find the following as the total amount of exports of cotton goods, to all countries East of the Cape of Good Hope, viz:
This amount is not equal, upon an average, to $24,000 per annum, and we would be glad to see it stated by the Boston Advertiser, what proportion of the “thousands of tons” of merchandise imported at Boston, within the last three months, were “paid for by our cotton manufactures;” and we should like the Salem Gazette to let us know what quantity of American cottons would “find a ready market at Madagascar.” We are inclined to think, that the answer would be, “not much;” and truly we think, that neither the trade with Turkey, nor that with the East Indies, is of such magnitude, as to warrant all the shouts of exultation which have been raised about them. As to the dogmatical assertion of the Salem Gazette, that “the steam engine allows no competition of human labour,” we take the liberty of suggesting to him, that he will not find that position supported by facts. Not only is a vast proportion of the cloth manufactured in Great Britain woven by the hand loom, but it is the case even in this country, where wages are so much dearer, and must be more extensively so in India, where labour is so much cheaper. In a former number of this paper, we published an article from an English newspaper, stating that a large manufacturing concern was about abandoning the power loom, in consequence of the hand loom having, by the lowness of wages, become the cheapest.
In this examination, we have met the question fairly, and we think the Boston Advertiser and Salem Gazette are bound to sustain their positions, or acknowledge a defeat. We will most cheerfully listen to their replies, and give them an insertion in our columns; and should they be able to show that we can export cotton goods to Calcutta, to a profit, we shall expect it of their candour honestly to confess that the prohibitory duty of this country is now no longer necessary.
P. S. After the foregoing was written, we were favoured with a letter from a highly respectable merchant of Philadelphia, which will completely settle this question. This is the sort of argument necessary for our cause in the present state of the contest, and if the merchants generally knew how much they could aid the cause of free trade and their own pockets, by communications like the one referred to, they would hardly withhold contributions so easily to be made:
“Philadelphia, Oct. 22, 1830.
I have lately noticed your publications in the Banner, on the subject of the possibility of our coarse cotton manufactures competing in foreign markets with the British, in reply to the various small publications or paragraphs appearing in the tariff newspapers. There is, however, one, which I believe has escaped your eye. It appeared in a Salem or Boston paper, and has since been copied into several of the newspapers of this city, which even goes further than any thing yet published to show how cheap coarse cotton goods can be made in this country, and that we can even beat the British in their own territories, and that too in a cotton-growing, manufacturing country, where the price of labour is about 10 cents per day.
The publication alluded to states that a Mr. Dodge, of Salem, exported in the ship Rome, to Calcutta, 300 bales of domestic manufactured cotton goods, and sold them advantageously. In order that you may judge of the correctness of this statement, I will state to you a fact which I can readily establish. I recently imported into this country a quantity of East India white cotton goods, assimilating in fabric to the coarse American or domestic muslin of 40 inches actual width, bleached and put up in bales, and sold them at less than twelve cents per yard, short price, (that is, free of duty, or taking the drawback to meet the duty,) to a person for exportation to South America, he purchasing them in preference to American manufactures, and I making on the importation a fair mercantile profit, and such as will induce me to repeat the importation, and I feel a tolerable certainty of obtaining the same price.—Prior to making the sale, I showed the goods to a person who had been engaged in the manufacturing of cottons, who admitted that at the price named to him, rather more too than I sold them at, they were cheaper than any thing in the market.
Should the Salem publication be substantiated, what a most fortunate state of things have we arrived at in mercantile affairs! I can import East India goods at a profit, and Mr. Dodge can ship articles of similar fabric to the East Indies, and make a profit.”