Source: Edward Atkinson, Taxation and Work: A Series of Treatises on the Tariff and the Currency (New York: G.P. Putnam’s Sons, 1892). CHAPTER XVII.: Protection Promotes War; Free Trade Promotes Peace.
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By the admission of the most prominent advocates of the present system of high duties from 1861 to 1867, and also by the admission of the Senators whose letters have been quoted, it has been proved that this method of applying the protective idea is not based upon a principle.
It is not, therefore, “an admitted truth requiring no further proof,” nor is it “a rule of action among human beings.” A high-tariff system represents merely a policy of which the purpose is to give another direction to the common rule of action among human beings than men would adopt if not forced to do so by tariff taxation.
The declared purpose of this policy is either to raise or to maintain the rate of wages above the rates prevailing in other countries, or to divert capital from the investments which would otherwise be chosen by its owners into arts which would be freely chosen were there no such policy of taxation. The complement or correlative of such laws are those of a precisely similar character which are called for by workmen for limiting the hours of labor and regulating methods of payment. All these acts are in a certain measure socialistic or even communistic in their very essence.
Free Trade, on the other hand, requires no force; it is what men engage in of their own motive and for the joint benefit or mutual benefit of both buyer and seller. It is true to the definition of principle—it is “an admitted truth which requires no further proof,” that “the rule of action among human beings,” who have risen above the stage of savagery, is to trade freely; that is to say, to exchange products with each other for mutual benefit. It does away with distribution by war, slavery, and force, substituting exchange by mutual agreement for the profit of both buyer and seller. It is “an admitted truth which requires no further proof,” that this exchange of product for product is an exchange of service by which men help each other. Free Trade or commerce among men and nations tends to the maintenance of peace, order, and industry. Witness the relation of the Dominion of Canada with this country during the civil war. It fortunately happened that before the civil war a treaty of mutual reciprocity in trade had been negotiated which was not ended until after the struggle. Under these favorable conditions beneficial to both countries—such was the influence that, although every effort was made by the most capable agents of the States in rebellion to incite Canada to attack the North, not one single regiment was required to guard our northern frontier, and not one ship of war was required to be stationed before the dominating port of Halifax. One of the most potent arguments by which Chancellor Caprivi has lately carried the treaties of reciprocity between the German Empire with Austria, Italy, and other countries, is that when men exchange products with each other they may not fight. It is the first step of relief from the standing armies that are eating out the very heart of Europe.
But it is true that there still are a few cranks in this country, some even in the Senate of the United States, who regard commerce as a sort of passive international war; men seriously object to the import of what they call a flood of foreign luxuries, upon the ground that such an import is a warlike attack upon our domestic industry, regardless of the fact that the greater part of these imports consists of the necessaries or comforts of life, or of crude materials of foreign origin without which some branches of our domestic industry would be destroyed.
With singular fatuity, these legislators are among the most prominent advocates and upholders of bounties and subsidies to lines of steamships connecting the United States with foreign countries; their purpose being to help the United States inflict the injury upon them from which they assume to defend themselves, i. e., to flood other countries with our products; that is to say, to flood Great Britain with our cotton and our grain, and to flood other nations with our manufactured goods and wares, while refusing to accept payment for our surplus products in articles which are of foreign production that we need in place of these exports. Surely what is sauce for the gander is also sauce for the goose. Yet these advocates of bounties are the very men who hiss at a reduction of our tariff, and who impute to those who try to promote commerce without bounties a dishonest seeking after British gold. Let them pass, their light can easily be hidden under a bushel because it is so feeble.
The fallacy which underlies this crude theory of trade is the same as the misconception which has led to the commercial wars of the last three centuries,—the false idea that a country profits only in its trade when it imports gold or silver in exchange for goods; or that when it imports more goods than it exports it must be meeting with a loss. It is no longer worth while to waste time in dealing with such persons, because as fast as they die their places are taken by men of a broader type and of greater intelligence, and also because with them it is useless to discuss this question, as they have presented these fallacies until they have become incapable of reasoning upon the basis of facts.
Suffice it, while Protection by means of a high tariff has only been defended by its original advocates, as a temporary expedient or policy of which Free Trade is the ultimate end, on the other hand Free Trade is founded upon a principle so universal and so fully constituting a rule of action among human beings that it always has and always will require force to prevent its application.
A high tariff only finds its justification among those who regard international commerce as a state of war, while Free Trade is sustained by its advocates because it promotes peace, order, and industry, good-will and plenty among all the nations of the world.
Free Trade may be especially desired in that country in which science and invention applied to the greatest natural resources have developed the largest product at the lowest cost from which the highest rates of wages are derived. That is the condition of this country. Our selfish interest is in Free Trade because we should gain the most in commerce whatever tariffs other nations might oppress themselves with.
It is this aspect of the case that lifts the discussion above one of mere profit and loss, and which raises it to the highest plane in ethics and in morals.
While the intentions of the advocates of what is miscalled Protection, but which is in fact privation, are doubtless good, they are of the same kind as the intention with which the road to Sheol is said to be paved, and in their application they have almost made a Sheol of the civilized world for about four centuries.
It would perhaps be difficult to discriminate between the wars which have been conducted in the name of religion and those which have ensued from the attempts to restrict commerce. The religious wars (God save the mark!) of France and Spain, drove the Moors and the Moriscoes with their arts and literature into Africa and the Huguenots and Flemings to England, as the persecution of the Jews is now driving the traders and bankers of Russia from her soil, thereby turning what might have been only the ill-effects of a short crop into a famine.
From the time when Columbus discovered the West Indies, or when Amerigo Vespucci discovered America, down to the present date, nearly every war has originated or has been conducted for the purpose of preventing one nation sharing with another in the benefits of commerce.
The efforts of France and Great Britain, through the Berlin decrees of Napoleon and the Orders in Council, to deprive each other of the benefits of commerce, first compelled Napoleon to sell Louisiana to this country, thus transferring to us a territory which, stretching from the Gulf of Mexico to the borders of Canada, will presently be the dwelling-place of a greater people than will occupy either Great Britain or France; a part of whose commerce through the Sault St. Marie Canal that unites the great lakes even now exceeds the traffic of all Europe with the East through the Suez Canal.
The end of all these wars of a single century since the French Revolution of 1793 has been that France has been exhausted in her efforts to depose the Bourbons and the Napoleonic dynasty, varying her efforts to govern herself by futile attempts to prevent the union of the people of Germany and Italy.
The several nations of the world, mainly European nations, whose debts are recorde