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Subject Area: Economics
Topic: Free Trade

ESSAY No. XCVI. - 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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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. XCVI.

april 6, 1831.

The present crisis calls for increased efforts on the part of the friends of free trade. The tax paid by Pennsylvania for the support of the American System, far exceeds her gains from it. An account-current stated.

OUR friends at the North begin to despond, and, in our humble opinion, the present crisis calls for increased efforts on the part of those who desire to see the principles of free trade established by a revolution in public opinion, and not by a revolution in which the sword shall perform the service which argument and reasoning are capable of effecting. That the party press is gradually coming to our aid, is very manifest—but the obstructions which are placed in its way, in some of the states, are too great to be surmounted but by slow degrees. For a long time yet to come, truth must be mixed up with fallacy, in accommodation to the prevailing prejudices of the day—and it is therefore not difficult to be seen, how important it is that a Banner should be constantly held up to the view of the combatants, upon which the true doctrine is inscribed. The course we have uniformly pursued, has been to maintain the abstract principles of political economy; and, although we may be considered as ultra in our views, we offer no apology for them. They are the truths of science—and, if others cannot come up to the mark, that is no reason why we should desert the standard.

We hinted, in a late paper, that a powerful demonstration upon Pennsylvania might make a deep impression upon that state. Pennsylvania has no direct interest in the tariff policy at all equal to the injury she sustains from its operation. Estimating her population at one tenth of the whole population of the United States—that is, 1,200,000 souls—and estimating her consumption of foreign commodities in the same proportion—it appears that, of the duties paid into the treasury, she contributes $2,400,000, the total amount being about $24,000,000. But this is not the whole burden she sustains from the impost system. She contributes one-tenth of the bounties paid to the monopolists who are favoured by law with the privilege, exclusive to a certain extent, of supplying certain commodities to the people of this country. She pays $240,000 per annum into the pockets of the sugar planters of Louisiana, of the whole bounty of $2,400,000. She pays at least $600,000 to the cotton manufacturers, that sum being equal to the one-tenth of two cents increased price per yard upon the quantity said to be manufactured in the country. She pays at least $1,200,000 to the manufacturers of wool, increased price, equal to one dollar per head of her population, which any one may see is not an over-estimate. She pays, on the various other articles consumed by her, and which have the benefit of protecting duties in their favour, such as iron, salt, glass, hardware, &c., or which are rendered dearer because their producers are taxed heavily on the articles they consume, an increased price, equal to at least $1,560,000 more. In short, the impost system, by its direct and indirect operations combined, cannot cost Pennsylvania one cent less than $6,000,000—that is, five dollars a head on her population—one-half of which, at least, may be placed to the account of the protective system.

Let us now examine, and see what she gains by the protective system. She produces a quantity of iron, equal, say, to 25,000 tons. Most of this iron is produced in the interior, and is not affected by foreign competition. That part of the duty which is imposed for protection does not exceed $20 upon an average, and, consequently, her whole gain on this article, as a state, cannot possibly amount to more than $500,000. She produces, in one district only, salt, which is so far out of the reach of the competition of foreign salt, that, if there were no duty at all upon it, the price could not be influenced. She produces cotton goods, but to a very limited extent, compared to her own consumption. The rest of her manufactures are very few of them dependent upon the protective system. They flourished when the duties were low, and they would continue to flourish if the duties were low again. Philadelphia has been prominent for her numerous manufactures ever since the period of the revolution, and her prosperity, so far from being dependent upon the restrictive system, has been injured by it. If an accurate statement could be made, by way of account-current, showing the advantages Pennsylvania enjoys from the existence of the tariff, and the advantages she would experience under a system of unrestricted trade, the balance would be shown to be so greatly in favour of the latter, that not a farmer in the state would hesitate as to the choice. Of this position we are firmly convinced, but the difficulty is, how can illustrations of these facts be brought into the view of the people? The existing press is afraid to touch the subject, because error and prejudice are so widely diffused that loss of patronage and political standing might be the consequence. Nor will people very readily pay for the privilege of reading a paper which they know contains views adverse to their existing notions. In all other matters, where it is desirable to reclaim people from error, the mode usually resorted to is to distribute gratuitously the means of illumination. Experience declares that there is no other effective mode of proceeding. If it were designed to teach Christianity in India, the mode of proceeding would be to give the New Testament to the Hindoos, and not to wait until they should come to buy it. Before a man will purchase a book, he must first have the inclination to read it. It must be put in his way without cost. We were for years witnesses of the struggle made in Philadelphia to disseminate the doctrines of restriction. Pamphlet after pamphlet was written, and literally forced upon the people against their wishes. One single individual, as we mentioned on a former occasion, expended a thousand dollars on this system of carrying the war into the enemy’s houses, and he had the gratification to find that his efforts were at last successful. He absolutely converted a free trade population to the opposite side of the question.

Now, can one who is acquainted with the difference between carrying on a combat with the sharp sword of truth and the blunt weapons of error, doubt of the success which would attend efforts directed to a specific point? We may perhaps attach an idea of too much potency to truth, but we have a very strong impression that the state of Pennsylvania may be carried by a bold stroke, and all will admit, that, if she can be detached from her allegiance to the American System, the fabric will crumble to atoms. At all events it is worth the attempt. The present year offers the most favourable moment for the experiment; and, if we should be seconded in our views by any considerable number of the friends to our cause, we flatter ourselves that we can offer a plan of operation which will be both practicable and economical.