Econlib

The Library

Other Sites

 Front Page arrow Titles (by Subject) arrow ESSAY No. LXXIX. - The Principles of Free Trade

Return to Title Page for The Principles of Free Trade

Search this Title:

Also in the Library:

Subject Area: Economics
Topic: Free Trade

ESSAY No. LXXIX. - 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).

About Liberty Fund:

Liberty Fund, Inc. is a private, educational foundation established to encourage the study of the ideal of a society of free and responsible individuals.


ESSAY No. LXXIX.

january 19, 1831.

Proposed duty on Screws. Effect of, examined.

WE had really hoped, that, at the present eventful moment, when the American System is shaking the Union to its centre, a decent respect for the public tranquillity would have induced those who are pocketing large sums of the people’s money, without an equivalent, to remain satisfied with their present monopolies, and to show a willingness, if not to retrace their steps, at least to halt, and not to press their system further, at the hazard of losing all they have. In this we have been disappointed. On the 23d ultimo, in the Senate of the United States, Mr. Marks presented “the petition of a Company in Philipsburg, Pennsylvania, for the manufacture of Iron Screws, praying that the duty on those articles, when imported, may be changed from an ad valorem to a specific duty,”—which was referred to the Committee on Manufactures.

This article of screws, we believe, is manufactured by only one or two establishments in the United States. They were taken under the protection of the American System in the year 1824, and favoured with a duty of 30 per centum, which, added to the expense of importation, amounting probably to 20 per centum more, gave a clear advantage to the American manufacturer, of 50 per centum over his foreign competitor. This, however, did not satisfy his calculation, or compensate for his want of skill and dexterity—and, in the year 1828. when the majority of Congress gave a broad invitation to all who wanted new monopolies, or old ones enlarged, he modestly asked to be indulged with a trifling increase of 10 per cent. Coming from Pennsylvania, “the key-stone of the federal arch,” so civil a request could not be refused, and, emboldened by this success, we now see the same concern coming forward and soliciting another increase, from 40 per centum, to—what?—not to 50 per centum, but to a specific duty—in other words, to such a duty as will rise, in its ad valorem ratio, as the price of foreign screws declines, and, in that manner, ultimately exclude them from the market, without letting the public see the cause. In this manner have the coarse cottons been shut out. Had the specific duty of 6¼ cents per square yard, which at the time it was fixed, in 1816, was about 25 per centum ad valorem, remained without any increase, it would have answered the purpose of excluding, without the aid of the higher duty, the coarser fabrics: for, as these annually fell in price, the ratio of the duty became increased from that very cause, and, what was but 25 per centum when the foreign cost was 25 cents per yard, would have become 125 when the foreign cost declined to five cents. We think that the nation has seen enough of specific duties to be convinced that they are the most unjust and unequal of all, and that they furnish a cloak for impositions and frauds upon the public, which cannot be practised under a bona fide system of ad valorem duties. Such are the duties now existing upon cotton goods which cost 35 cents per square yard, or less, and upon all coarse woollen cloths, flannels, and baizes. On the face of the law they are called ad valorem duties, but they are, in reality, specific duties, and we think ought to be returned under that head in the annual Commercial Statements, made by the Secretary of the Treasury to Congress.

What this screw concern want Congress to do, is, probably, to enact a clause in the following form: “And be it enacted, &c., That henceforth the duty upon iron screws, called wood screws, shall be 40 per centum ad valorem—provided, that all screws, costing less than the highest price at which the largest and best finished are sold, and such as cannot be made in this country, shall be deemed to have cost said highest price, (although they may not have cost a fourth of the money,) and shall be charged with duty accordingly.” We trust, however, that Congress, if it desires to favour the manufacturers of screws, will do it in a way compatible with the peace and interests of the country; that is, by taking off the duty on iron, for herein consists the principal difficulty which Messrs. Phillips, & Co. have to encounter, although they do not say so in the frank manner that the Philadelphia blacksmiths, last winter, stated their grievances.