The Online Library of Liberty

A project of Liberty Fund, Inc.

• Foreword
• A Note On the Text
• Preface to the First Edition
• Tyranny Unmasked
• Section One: Unmasking the Protecting-tariff Policy and Its Advocates From Many Perspectives
• Section Two: Arguments Against the Protecting Duty Summarized Through an Analysis of Its Major Consequences
• 1.: Protecting Duties Are Unconstitutional
• 2.: Manufactures Are Injurious to Morals, and Produce Pauperism
• 3.: No Further Protection Necessary
• 4.: The Increase of Duties Will Lead to Smuggling
• 5.: A Tax On the Many, a Bounty to the Few
• 6.: A Restrictive System
• 7.: Destroy Revenue
• 8.: Ruin Commerce
• 9.: Destroy Agriculture
• Section Three: a General Discussion of Tyranny and the Choice That Americans Face

3.

No Further Protection Necessary

If the proposition had been differently stated, it would have exhibited the question in plainer language. Suppose it had been objected, that further protection was not wanted. The Committee might have replied with truth, that the capitalists did want more money. The objection means that the capitalists do not need more money, and the Committee state that they already have more than they know what to do with, but that they want more still. From these facts, the plain question is, whether the nation, though reduced itself to pecuniary distress, ought to give more money to the capitalists because they want it, although they have already more than they can use.

The first reason for doing so urged by the Committee is,

Thus they have reduced the point to a plain matter of fact. They say that a bounty to one factory would be a partial monopoly, and would create a privileged order of great capitalists, which would be unjustifiable; but that a bounty to all the factories is not a monopoly and will not create such an objectionable order. One bishop would be a hierarchy, but an hundred bishops would be religious freedom. I had thought that separate social interests, like separate nations, were individual with respect to each other. It would seem to common sense, if one privileged factory would suffice to create a dangerous exclusive interest, that a hundred factories combined by a common bounty, would create an exclusive interest an hundred-fold more dangerous. If each received its bounty by separate laws, each law would create an unjustifiable monopoly say the Committee, because they would be uncombined by law, however they might be united by interest; but if all these factories are combined both by one law, and a common interest, then the combination changes the whole mass from a monopoly into a protector of national industry, and will not produce a privileged order of great capitalists. Whether there are more or fewer factories than one hundred in the United States, it is excessively wide of truth, and excessively humiliating to all occupations, to apply to them exclusively the phrase “national industry.” By doing so, the Committee have taken a substratum for their system, to be found in no other treatise which has ever appeared, and which is crushed by the weight of the plainest fact imaginable. In the old systems of political economy, land, labour and corn, have been considered as comprising the chief sources or items of national industry, and have been selected as the measures of national prosperity. But the Committee, in the face of every body's knowledge to the contrary, assert that the whole mass of national industry, is concentrated in a few factories, and that of course a bounty to them is a general and equal protection to national industry. If the fact was so, the bounty would be inert. Paid by national industry to national industry, it would only be the case of a man's giving money to himself.

Their idea, however, is, that these factories, though by no means constituting national industry, will afford general and equal protection to national industry. It is borrowed from the old idea of protection for allegiance, being only protection for bounties. One man pretended to protect a nation, if that nation would bountifully make over to him its liberty and property. One hundred factories offer to protect all the numerous branches of national industry, if the nation will be equally bountiful to them. I know not which is most to be coveted, the protection of a monarch, or of a pecuniary aristocracy. Writers upon political economy, as far as I recollect, have wholly neglected to recommend either. All of them consider branches of industry as separate and distinct; and allow, that some may be oppressed by exclusive privileges or bounties to others, because they must pay whatever these others receive from partial laws; and none assert that factories and agriculture are one and indivisible. The Committee subscribe to the same opinion in admitting that one factory endowed with a bounty would operate unjustly upon other national interests. In England, agriculture and factories are considered as interests so clearly distinct, that two violent and contending parties have been created and kept alive by bounties and monopolies occasionally given to each. Neither of these contending interests have ever asserted, that bounties to one, were bounties to the other; and the difficulty has been, to adjust the compensation for the injury sustained by one, from partialities to the other. At this very time the manufacturers are complaining of the corn monopoly, which, though created to encourage the most important branch of industry among men, and in England particularly, is fraudulent and oppressive upon all other branches of national industry, and protects them, just as they are protected here by our factory monopoly; by enriching itself at their expense. The English landlords have never had the assurance to assert, that their corn monopoly made bread cheaper to consumers. It has been tried much longer than our factory monopoly, and instead of making bread cheaper, has increased rents and enriched landlords at the expense of bread consumers. Our factories have asserted, that their monopoly would make manufactures cheaper. But after a considerable trial, its effects are found to correspond with those of other monopolies. It has only enriched capitalists and impoverished other occupations. The Committee admit that our moneyed capitals have increased even more rapidly than English rents; that they have grown up to an exuberance which cannot find employment. The English landlords do not complain of an exuberance of rents, nor crave an extension of their monopoly for its employment. The enormous growth of individual capitals, and the pecuniary depression of all other interests do not sustain the hope of the Committee, that a factory monopoly will be “a general and equal protection of national industry.”

Whence came the redundant capitals allowed by the Committee to exist? If from commerce, it must have been highly lucrative; if from a system of internal legislation, that must have been excessively partial. Had commerce begotten this redundant capital, a correspondent prosperity of agriculture or other occupations must have been visible, unless it can be proved that a lucrative commerce will impoverish a nation. The Committee, by urging a balance of trade as the cause of national prosperity, have admitted that commerce is the instrument by which it is to be obtained; and by admitting the existence of redundant capitals in the hands of individuals with a concurrent national distress, it follows, either that these redundant capitals have been brought in by a favorable commerce, or bestowed by partial laws. Under the first supposition, there exists no reason for endeavoring to make so lucrative a commerce better by home monopoly, under the second, there is still less reason for increasing the national distress, to add to the accumulations of individual capitals.

But the Committee have endeavored to blend the mercantile and capitalist occupations, so as to conceal the distinctions by which their very different effects are produced. They assert, that the protection afforded to commerce has enabled merchants to acquire princely fortunes, and leaving us to imagine that this protection is a bounty to merchants, infer that they are uncharitable in opposing bounties to factory owners, since they receive them. It is strange that the heat of controversy should have elicited an assertion, that protection to commerce was a bounty to merchants, when the benefits arising from it must so evidently be reaped chiefly by the owners and consumers of the commodities which it is the occupation of merchants to exchange. But the Committee had forgotten that the commercial and capitalist occupations are essentially different. The business of one is to exchange property, of the other to transfer it. One coincides with the good soul of money, in regulating these exchanges by free will; the other combines with its bad soul, by using it to promote transfers without equivalents. If the legislature should lay a duty upon imported commodities to be paid to merchants, then, and then only, would the two occupations produce the same effects, because it would be similar to the excise paid to capitalists, collected for them by restrictions and prohibitions. There are no such bounties given to merchants, and therefore the mercantile occupation, instead of inflicting general penury to promote partial wealth, has the effect of diffusing general prosperity by cheapening human comforts. It is in fact one of those occupations by which nations are enabled to exist under the property-transferring policy in its several forms. Had the capitalists requested Congress to increase the extravagance of government, in order to extend and protect the system of borrowing, for the purpose of giving employment to their exuberant wealth, they might as justly have charged the mercantile body with injustice for opposing the application, as in the present case. The same charge has been frequently urged against the farmers, and admits of the same answer. In both cases it results in the following doctrine, considered in its favorable aspect. Merchants and agriculturists are made rich by free industry and fair exchanges, but this operation is too slow for capitalists, and therefore it is ungenerous in the two first classes to oppose the enrichment of the third by monopolies, without exposing it to the toils which the two must undergo or remain poor.

All advertisements for recommending quack physick either to the body natural or body politick, are exposed to detection, because they are suggested by the same design. The Committee have represented the mercantile occupation as creating princely fortunes, but they have not said that these fortunes have been obtained by means of legal transfers of property, nor informed us by what operation so lucrative a commerce can impoverish the rest of the community. Other capitalist writers have filled pamphlets with computations to magnify agricultural wealth; but none have attributed this supposed wealth to a property-transferring monopoly. What an enigma is here exhibited. Merchants and agriculturists are wonderfully rich, yet a country in which these classes constitute a great majority is in terrible distress. At one time these doctors say that the superabundant blood of agriculture and commerce ought to be drawn off; at another, that they are expiring for want of blood, but that bleeding is still necessary. We are assured as usual by these doctors, that the same physick will cure both emptiness and repletion; that it is equally good for the most opposite complaints, and equally beneficial whether merchants and farmers are rich or poor. They were indeed pretty well and tolerably rich, whilst they forbore to swallow bolus after bolus compounded of commercial restrictions, prohibitions, embargoes, exclusive privileges, and monopolies; and have become sicker or poorer the more these drugs have been administered to them. But what of that? The Committee say, “we risk much by acting on the belief that the English nation does not understand its interest; and protection should end then, only after securing employment for all.” These declarations are appalling. The drug recommended is that which the people of England are forced to swallow by a corrupt government, and we are desired to take it until employment is secured for all, which has never been effected by it. The reason given for it is curious. Commerce and agriculture are informed that they are sick, to induce them to take the physick; and that they are rich, to induce them to pay the doctors. If they should agree to pay a vast annual tax to the capitalists, until their prescriptions shall secure employment for all, especially for growing capitals, there are two tolerably strong reasons that the tax will last for ever. One, that the proposed object is an impossibility; the other, that the capitalists would never effect it by their prescriptions if they could, because they would thereby lose their fees. Employment must be nurtured by free exchanges, like commerce, or it flags. Commercial action and reaction constitute its food. Take away one and the other languishes. A nation deprived of the excitements arising from commercial reverberations, loses the creator of employment, as well as of civilization, knowledge, and comforts; and recedes towards savageness. Even with the aid of these excitements, employment for all can never be established. The fluctuations caused by war, seasons, fashions, and the wonderful catalogue of human passions, will reach employment and prevent that permanency no where to be found; but these fluctuations left to be met by free industry, are themselves excitements of genius and talents, and awaken exertions into life. Which generate most employment, all the inducements which propel the mind and body to make the utmost efforts they can, or the protecting-duty system which destroys most of them?