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william loughton smith Speech in the House of Representatives 13 January 1794 - Lance Banning, Liberty and Order: The First American Party Struggle [1787]

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Liberty and Order: The First American Party Struggle, ed. and with a Preface by Lance Banning (Indianapolis: Liberty Fund, 2004).

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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.


william loughton smith Speech in the House of Representatives 13 January 1794

The most effective speech against Madison’s resolutions was delivered by his old foe, William Loughton Smith of South Carolina. In his biography of Hamilton, however, John C. Hamilton reported that the speech was drafted by his father.

The House again resolved itself into a Committee of the Whole House on the Report of the Secretary of State on the Privileges and Restrictions on the Commerce of the United States in Foreign Countries. When

Mr. Smith, of South Carolina, rose and addressed the Chair as follows:

Mr. Chairman:—Among the various duties which are assigned by the Constitution to the Legislature of the United States, there is, perhaps, none of a more important nature than the regulation of commerce, none more generally interesting to our fellow-citizens, none which more seriously claims our diligent and accurate investigation… .

It will not be denied that this country is at present in a very delicate crisis, and one requiring dispassionate reflection, cool and mature deliberation. It will be much to be regretted then, if passion should usurp the place of reason, if superficial, narrow, and prejudiced views should mislead the public councils from the true path of national interest.

The report of the Secretary of State … (whatever may have been the design of the reporter) appears … to induce a false estimate of the comparative condition of our commerce with certain foreign nations, and to urge the Legislature to adopt a scheme of retaliating regulations, restrictions, and exclusions.

The most striking contrast which the performance evidently aims at is between Great Britain and France. For this reason, and as these are the two powers with whom we have the most extensive relations in trade, I shall, by a particular investigation of the subject, endeavor to lay before the Committee an accurate and an impartial comparison of the commercial systems of the two countries in reference to the United States, as a test of the solidity of the inferences which are attempted to be established by the report. A fair comparison can only be made with an eye to what may be deemed the permanent system of the countries in question. The proper epoch for it, therefore, will precede the commencement of the pending French Revolution.

The commercial regulations of France during the period of the Revolution have been too fluctuating, too much influenced by momentary impulses, and, as far as they have looked towards this country with a favorable eye, too much manifesting an object of the moment … to consider them as a part of a system. But though the comparison will be made with principal reference to the condition of our trade with France and Great Britain antecedent to the existing revolution, the regulations of the subsequent period will perhaps not be passed over altogether unnoticed.

The table which I have before me comprises the principal features of the subject within a short compass. It is the work of a gentleman of considerable commercial knowledge, and I believe may be relied on for its correctness… .

Accustomed as our ears have been to a constant panegyric on the generous policy of France towards this country in commercial relations and to as constant a philippic on the unfriendly, illiberal, and persecuting policy of Great Britain towards us in the same relations, we naturally expect to find in a table which exhibits their respective systems numerous discriminations in that of France in our favor and many valuable privileges granted to us which are refused to other foreign countries, in that of Great Britain frequent discriminations to our prejudice and a variety of privileges refused to us which are granted to other foreign nations. But an inspection of the table will satisfy every candid mind that the reverse of what has been supposed is truly the case—that neither in France nor the French West Indies is there more than one solitary and important distinction in our favor (I mean the article of fish oil) either with regard to our exports thither, our imports from thence, or our shipping; that both in Great Britain and the British West Indies there are several material distinctions in our favor with regard both to our exports thither and to our imports from thence, and, as it respects Great Britain, with regard also to our shipping; that in the market of Great Britain, a preference is secured to six of our most valuable staples by considerably higher duties on the rival articles of other foreign countries; that our navigation thither is favored by our ships, when carrying our own productions, being put upon as good a footing as their own ships, and by the exemption of several of our productions, when carried in our ships, from duties which are paid on the like articles of other foreign countries carried in the ships of those countries; and that several of our productions may be carried from the United States to the British West Indies, while the like productions cannot be carried thither from any other foreign country; and that several of the productions of those countries may be brought from thence to the United States, which cannot be carried from thence to any other foreign country… .

[Smith then proceeded, item by item, to compare French and British regulations affecting American exports (flour, tobacco, rice, wood, fish, salted meats, etc.), arguing that, in the great majority of cases, British regulations were more favorable to American products than were those of France. He next observed that three-fourths of America’s imports came from Britain and its dominions—some seven and one-half times the dollar value as came from France. This, he said, was not a grievance but a natural consequence of Britain’s ability to “supply us with the greatest number of the articles we want, on the best terms.” It could not be changed except by an effective system of encouraging home manufactures or “by means violent and contrary to our interests”: premiums for imports from other countries or higher duties on British goods “at the expense of the people of the United States.” Turning finally to a comparison of French and British treatment of American shipping, he admitted that French regulations were generally more favorable than those of Britain: American ships carrying American products directly to Great Britain were treated more favorably than those of any other nation, which was not the case in France; but American ships were not permitted to carry the products of other nations to Britain, and Britain excluded American ships from the British West Indies, whereas France admitted American vessels of sixty tons or more. He insisted, nevertheless, that both nations “aimed at securing the greatest possible portion of benefit to themselves, with no greater concession to our interests than was supposed to coincide with their own,” that there were no grounds for extolling the policies of one of them or denouncing those of the other.]

… The system of every country is selfish according to its circumstances and contains all those restrictions and exclusions which it deems useful to its own interest. Besides this, a desire to secure to the mother country a monopoly of the trade of its colonies is a predominant feature in the system of almost every country in Europe. Nor is it without foundation in reason. Colonies, especially small islands, are usually maintained and defended at the expense of the mother country, and it seems a natural recompense for that service that the mother country should enjoy, exclusively of other nations, the benefit of trade with its colonies. This was thought reasonable by the United States while colonies even after their disputes on the point of taxation had begun; and however the question may stand between the mother country and its colonies, between the former and foreign nations, it is not easy to see how the equity of the exclusion can be contested. At any rate, its being the most prevailing system of nations having colonies, there is no room for acrimony against a particular one that pursues it. This ought not to dissuade the United States from availing itself of every just and proper influence to gain admission into the colony trade of the nations concerned; but this object ought to be pursued with moderation, not under the instigation of a sense of injury, but on the ground of temperate negotiation and reasonable equivalent.

These observations ought to produce two effects: to moderate our resentments against particular nations and our partialities for others, and to evince the impracticability and Quixotism of an attempt by violence, on the part of this young country, to break through the fetters which the universal policy of nations imposes on their intercourse with each other… .

The Secretary of State, after pointing out the exclusions, restrictions, and burdens which prevent our enjoying all the advantages which we could desire in the trade with foreign countries, proceeds to indicate the remedies; these are counter-exclusions, restrictions, and burdens.

The reason of the thing and the general observations of the Secretary of State would extend the regulations to be adopted to all the nations with whom we have connexions in trade; but his conclusion would seem to confine them to Great Britain, on the suggestion that she alone has declined friendly arrangements by treaty, and that there is no reason to conclude that friendly arrangements would be declined by other nations… .

Why, then, is Great Britain selected, but that it is most in unison with our passions to enter into collisions with her?

If retaliations for restrictions, exclusions, and burdens are to take place, they ought to be dealt out, with a proportional hand, to all those from whom they are experienced. This, justice and an inoffensive conduct require. If, suffering equal impediments to our trade from one power as another, we retaliate on one and not on another, we manifest that we are governed by a spirit of hostility towards the power against whom our retaliation is directed, and we ought to count upon a reciprocation of that spirit. If, suffering fewer from one than from another, we retaliate only on that party from whom we suffer least, the spirit of enmity by which we were actuated becomes more unequivocal. If, receiving a positively better treatment from one than another, we deal most harshly towards that power which treats us best, will it be an evidence either of justice or moderation? Will it not be a proof either of caprice or of a hatred and aversion of a nature to overrule the considerations both of equity and prudence? …

Whatever may be the motive, the operation may clearly be pronounced to be a phenomenon in political history—a government attempting to aid commerce by throwing it into confusion; by obstructing the most precious channels in which it flows, under the pretence of making it flow more freely; by damming up the best outlet for the surplus commodities of the country and the best inlet for the supplies of which it stands in need; by disturbing, without temptation, a beneficial course of things, in an experiment precarious, if not desperate; by arresting the current of a prosperous and progressive navigation to transfer it to other countries, and by making all this wild work in the blameable, but feeble attempt to build up the manufactures and trade of another country at the expense of the United States… .

It is a project calculated to disturb the existing course of three-fourths of our import trade, two-fifths of our export trade, and the means on which depend two-thirds, at least, of our revenues.

To be politic, therefore, it ought to unite these different ingredients:

First. An object of adequate utility to the country.

Second. A moral certainty, at least, of success.

Third. An assurance that the advantage likely to be obtained is not overbalanced by the inconveniences likely to be incurred, and as an equivalent for the jeopardy to which advantages in our possession are exposed.

1st. The direct object professed to be aimed at is a freer trade with Great Britain and access to her West India Islands, in our own ships. A collateral one, the success of which seems most relied on, is to transfer a part of our too great trade with Great Britain to other nations, particularly France.

The first is no doubt an object of real magnitude, worthy of every reasonable and promising exertion. The second, in the single light of obviating a too great dependence for supply on one nation, is not unworthy of attention, but, as before observed, it ought only to be aimed at by expedients neither embarrassing nor expensive; it is a very insufficient object to be pursued either at hazard or expense to the people of the United States. It has been already shown, that to pursue it, either by prohibitions or partial increase of duties, would be a costly undertaking to this country.

2nd. The second ingredient is, “a moral certainty of success.” The argument used to prove the probability, nay, the certainty of success, is this: the United States are a most important customer to Great Britain; they now take off near three millions in her manufactures, and by the progress of their population, which is likely to exceed that of their manufactures, the probability is that their importance as a customer will increase every year; their importance to Great Britain, as a source of supply, is not less than as a customer for her manufactures; the articles with which they furnish her, are those of prime necessity, consisting of the means of subsistence and the materials for ship-building and manufactures, while the articles we derive from her are mostly those of convenience and luxury; her supplies to us are therefore less useful than ours to her; that it would be contrary to all good policy in Great Britain to hazard the turning of a commerce so beneficial into other channels; besides all this, Great Britain is immersed in debt and in a state of decrepitude; derangement of our commerce with her would endanger a shock to the whole fabric of her credit, and by affecting injuriously the interests of a great portion of her mercantile body, and by throwing out of employ a large number of her manufacturers, would raise a clamor against the Ministry too loud and too extensive to be resisted; and that they would consequently be compelled, by the weight of these considerations to yield to our wishes.

It is as great an error in the councils of a country to over-rate as to under-rate its importance. The foregoing argument does this, and it does it in defiance of experience. Similar arguments were formerly used in favor of a non-importation scheme; the same consequences now foretold were then predicted in the most sanguine manner; but the prediction was not fulfilled. This it would seem, ought to be a caution to us now, and ought to warn us against relying upon the like effects, promised from a measure of much less force, namely, an increase of duties.

If our calculations are made on the ordinary course of the human passions, or on a just estimate of relative advantages for the contest proposed, we shall not be sanguine in expecting that the victory will be readily yielded to us, or that it will be easily obtained.

The Navigation Act of Great Britain, the principles of which exclude us from the advantages we wish to enjoy, is deemed by English politicians as the palladium of her riches, greatness, and security.

After having cherished it for such a long succession of years, after having repeatedly hazarded much for the maintenance of it, with so strong a conviction of its immense importance, is it at all probable that she would surrender it to us without a struggle—that she would permit us to extort the abandonment of it from her without a serious trial of strength?

Prejudices riveted by time and habit, opinions fixed by long experience of advantages, a sense of interest, irritated pride, a spirit of resentment at the attempt, all these strong circumstances would undoubtedly prompt to resistance. It would be felt that if a concession were made to us upon the strength of endeavors to extort it, the whole system must be renounced; it would be perceived that the way having been once successfully pointed out to other nations, would not fail to be followed, and that a surrender to one would be a surrender to all.

Resistance, therefore, would certainly follow in one or other mode, a war of arms or of commercial regulations.

If the first should be determined upon, it would not be difficult for Great Britain to persuade the other powers with whom she is united that they ought to make common cause with her. She would represent that our regulations were in fact only a covert method of taking part in the war by embarrassing her, and that it was the interest of the cause in which they were combined to frustrate our attempts.

If war could be foreseen as the certain consequence of the experiment proposed to be made, no arguments would be necessary to dissuade from it. Everybody would be sensible that more was to be lost than gained, and that so great a hazard ought not to be run.

But we are assured that there is no danger of this consequence, that no nation would have a right to take umbrage at any regulations we should adopt with regard to our own trade, and that Great Britain would take care how she put to risk so much as she would hazard by a quarrel with us.

All this is far more plausible than solid. Experience has proved to us that the councils of that country are influenced by passion as well as our own. If we should seize the present moment to attack her in a point where she is peculiarly susceptible, she would be apt to regard it as a mark of determined hostility. This would naturally tend to kindle those sparks of enmity which are alleged to exist on her side. War is as often the result of resentment as of calculation. A direct and immediate war between us would not be surprising; but if this should not take place, mutual ill offices and irritations, which naturally grow out of such a state of things, would be apt quickly to lead to it. Insults and aggressions might become so multiplied and open as not to permit forbearance on either side… .

Let us, however, take it for granted that she would prefer the other course, that of retaliating regulations; how will the contest stand? The proportion of the whole exports of Great Britain which comes to the United States is about one-fifth; the proportion of our exports which goes to Great Britain is about one-eighth of the whole amount of her imports. Taking the mean of these proportions of imports and exports, the proportion which our trade with Great Britain bears to the totality of her trade is about one-sixth.

The proportion of imports from the dominions of Great Britain into the United States may be stated at three-fourths of our whole importation; the proportion which our exports to the same dominions bears to our total exportation may be stated at two-fifths; taking the mean of those two, the proportion which our trade with Great Britain bears to our whole trade is something more than one-half.

This much greater proportional derangement of our trade than of hers by a contest is a mathematical demonstration that the contest would be unequal on our part; that we should put more to hazard than Great Britain would do; should be likely to suffer greater inconvenience than her, and consequently (the resolution and perseverance of the two parties being supposed equal) would be soonest induced to abandon the contest… .

The main argument for the chance of success is that our supplies to Great Britain are more necessary to her than hers to us. But this is a position which our self-love gives more credit to than facts will altogether authorize. Well-informed men in other countries (whose opportu-nities of information are at least as good as ours) affirm that Great Britain can obtain a supply of most of the articles she obtains from us as cheap and of as good a quality elsewhere, with only two exceptions, namely, tobacco and grain, and the latter is only occasionally wanted; a considerable substitute for our tobacco, though not of equal quality, may be had elsewhere; and even admitting this position to be too strongly stated, yet there is no good reason to doubt that it is in a great degree true. The colonies of the different European powers on this continent, some countries on the Mediterranean, and the northern countries of Europe, are in situations adapted to becoming our competitors.

On the other hand, the manufactured articles which we do not make ourselves (the greatest part of which are, in civilized countries, necessaries) are as important to us as our materials for manufacture (the only articles for which her demand is constant) are to Great Britain. The position is as true that no other nation can supply us as well as that country with several essential articles which we want, as that no nation can supply her equally well with certain articles which she takes from us; and as to other articles of subsistence, it is certain that our demand for manufactured supplies is more constantly urgent than her demand for those articles. Where, indeed, shall we find a substitute for the vast supply of manufactures which we get from that country? No gentleman will say that we can suddenly replace them by our manufactures, or that this, if practicable, could be done without a violent distortion of the natural course of our industry. A substitute of our own being out of the question, where else shall we find one?

France was the power which could best have filled any chasm that might have been created. But this is no longer the case. It is undeniable that the money capitals of that country have been essentially destroyed; that manufacturing establishments, except those for war, have been essentially deranged. The destruction to which Lyons appears to be doomed is a severe blow to the manufactures of France; that city, second in importance, in all respects, was perhaps the first in manufacturing impor-tance. It is more than probable that France, for years to come, will herself want a foreign supply of manufactured articles… .