http://accountingbookspdf.com/ The Tariff History of the United States http://accountingbookspdf.com/ http://accountingbookspdf.com/ The Tariff History of the United States By F.W Taussig Henry Lee Professor of Economics in Harvard University FIFTH EDITION Revised, with Additional Material, Including a Consideration of the Aldrich-Payne Act of 1909 G.P Putnam’s Sons New York and London The Knickerbocker Press http://accountingbookspdf.com/ G.P Putnam’s Sons New York and London and The Knickerbocker Press © 1910, [1892] Cover prepared by Chad Parish Introduction © 2010 by the Ludwig von Mises Institute and published under the Creative Commons Attribution License 3.0 Text typeset and reprinted in 2010 by the Ludwig von Mises Institute Ludwig von Mises Institute 518 West Magnolia Avenue Auburn, Alabama 36832 mises.org ISBN: 978-1-61016-132-9 http://accountingbookspdf.com/ Note to the First Edition Of the papers printed in this volume none is now presented to the public for the first time The essay on “Protection to Young Industries as Applied in the United States” was first published in Cambridge in 1882, and was republished in a revised edition in New York in 1883 The paper on “The tariff of 1828” appeared in the Political Science Quarterly for March, 1888 That on “The History of the Tariff between 1830 and 1860” was printed in the Quarterly Journal of Economics for April, 1888 “The History of the Present Tariff ” was published in New York in 1885 All, however, have been revised for the present volume, and considerable additions have been made I have avoided repetitions, so far as this was possible, and have attempted to connect the narrative of the separate parts Although not originally written with the design of presenting a complete history of our tariff legislation, these papers cover in some sort the entire period from 1789 to 1887 F.W.T Cambridge, Mass., July, 1888 http://accountingbookspdf.com/ http://accountingbookspdf.com/ Note to the Fifth Edition In previous editions, the narrative was brought to date by chapters on the acts of 1890, 1894, and 1897 It is now again brought to date by the addition of a chapter on the act of 1909 One further change is made in the present edition The chapter on “Some Aspects of the Tariff Question,” which came at the end of the volume in the third and fourth editions, is omitted That chapter considered certain industries—the manufacture of silks, fine woollens, glassware, earthenware, the production of hemp, flax, and beet sugar—as they had developed to the year 1890 Since then, great changes have taken place, and the narrative as it stood was incomplete, and in some respects misleading I hope before long to take these subjects up again, and to bring to date this part of our tariff history also The pressure of other tasks makes it impossible to so at the moment, and hence the chapter is omitted in the present edition Cambridge, Mass., November, 1909 http://accountingbookspdf.com/ http://accountingbookspdf.com/ Contents PART I Protection to Young Industries as Applied in the United States Chapter I I The Argument for Protection to Young Industries 11 II Industrial History of the Colonies and of the United States before 1808 16 III The Cotton Manufacture 29 IV The Woollen Manufacture 38 V The Iron Manufacture 45 VI Concluding Remarks 56 Chapter II The Early Protective Movement and Tariff of 1828 63 Chapter III The Tariff, 1830–1860 97 PART II Tariff Legislation, 1861–1909 Chapter I The War Tariff 135 Chapter II The Failure to Reduce the Tariff after the War 149 http://accountingbookspdf.com/ 349 Appendix Table (continued) Year 1882 1883 1884 1885 1886 1887 1888 1889 1890 1891 1892 1893 1894 1895 1896 1897 1898 1899 1900 1901 1902 1903 1904 1905 1906 1907 Internal Revenue 146.5 144.7 121.6 112.5 116.8 118.8 124.3 130.9 142.6 145.7 154.0 116.0 147.1 143.4 146.8 146.7 170.9 273.4 295.3 307.2 271.9 230.8 232.9 234.1 249.1 269.7 Customs Revenue 220.4 214.7 195.1 181.5 192.9 217.3 219.1 223.8 229.7 219.5 177.5 203.4 131.8 152.2 160.0 176.6 149.6 206.1 233.2 238.6 254.4 284.5 261.3 261.8 300.2 332.2 http://accountingbookspdf.com/ 350 Tariff History of the United States / Taussig Table Production, Imports, and Exports of Copper, and Foreign and Domestic Prices (Quantities in gross tons.) Year 1875 1876 1877 1878 1879 1880 1881 1882 1883 1884 1885 1886 Imports Imports Domestic Copper Copper Production in Pigs Ore Exports 18,000 415 2,300 2,280 19,000 777 910 6,430 21,000 750 15 6,050 21,500 165 399 5,040 23,000 70 100 7,680 27,000 2,350 2,000 1,880 32,000 320 4,420 2,160 41,000 334 8,190 1,490 52,000 148 500* 3,890 63,500 65 980 7,610 74,000 35 1,630 19,900 70,000 18 1,840 10,850 Price Price per per lb lb in cts in cts New York London Lake Chili Difference Copper Bars in Price 23.0 18.0 5.0 21.5 16.5 5.0 19.0 14.6 4.4 16.5 13.5 3.0 17.5 12.2 5.3 20.0 13.5 6.5 18.5 13.3 5.2 18.7 14.4 4.3 16.1 13.7 2.4 13.7 11.8 1.9 11 9.5 1.5 11 8.8 2.2 * Beginning with 1883, this column states the quantity of copper contained in imported ore, not the gross amount of ore The 8,190 tons of ore imported in 1882 contained about 600 tons of copper Figures are from “Mineral Resources of the United States,” pp 214, et seq The production is for the calendar year, the imports and exports for the fiscal year (ending June 30th) The annual average prices are from the monthly prices given in “Mineral Resources.” The figures given in “Mineral Resources” seem to contain considerable understatements, so far as exports are concerned See Eng and Min Journal, Jan 26, 1884, p 59 These tables show the price in New York to have been higher than that in London by from 1½ to 5½ cents In recent years the great increase in domestic production has forced down the price here, and the difference in price is not more http://accountingbookspdf.com/ 351 Appendix than 1½ cents The better quality of domestic Lake copper would cause it to bring 1½ cents more than Chili bars under any circumstances Cost of transportation (from London to Now York) is insignificant It is safe to say that any difference in price over and above 1½ cents per pound could not exist if it were not for the duty on copper Table Production, Imports, and Foreign and Domestic Prices of Steel Rails Product in U.S., Imports, Gross Gross Year Tons Tons 1871 34,100 505,500 1872 84,000 474,000 Average Price in U.S $91.70 $99.70 Average Average Excess of Price in American England Price $57.70 $34.00 $67.30 $32.40 1873 1874 115,200 129,400 231,000 96,700 $95.90 $84.70 $74.40 $57.50 $21.50 $27.20 1875 259,700 17,400 $59.70 $44.10 $15.60 1876 1877 1878 1879 1880 1881 1882 368,300 385,900 499,800 618,800 864,300 1,210,300 1,304,400 … … … 39,400 259,500 344,900 200,000 $53.10 $43.50 $41.70 $48.20 $67.50 $61.10 $48.50 $37.70 $31.90 $27.20 $24.70 $36.00 $31.20 $30.00 $15.40 $11.60 $14.50 $23.50 $31.50 $29.90 $18.50 1883 1,156,900 34,800 $37.75 $25.40 $12.35 1884 1885 1886 1887 1888 999,400 963,700 1,579,400 2,119,000 1,391,000 2,800 2,200 41,600 137,800 63,000 $30.75 $28.50 $34.50 $37.10 $29.80 $22.90 $23.65 $20.65 $20.65 $19.20 $7.85 $4.85 $13.85 $16.45 $10.60 Duty $28.00 $25.20 Aug ’72 $25.20 $25.20 Mar ’75 $28.00 Mar ’75 $28.00 $28.00 $28.00 $28.00 $28.00 $28.00 $28.00 July ’83 $17.00 July ’83 $17.00 $17.00 $17.00 $17.00 $17.00 Table continues on next page ▶ http://accountingbookspdf.com/ 352 Tariff History of the United States / Taussig Table (continued) Product in U.S., Imports, Gross Gross Year Tons Tons 1889 1,531,000 6,200 Average Price in U.S $29.25 Average Average Excess of Price in American England Price $24.15 $5.10 1890 1,871,400 … $31.75 $27.30 $4.45 1891 1892 1893 1,298,900 1,541,400 1,130,400 … … 2,900 $30.00 $30.00 $28.00 $22.00 $20.00 $18.50 $8.00 $10.00 $9.50 1894 1,017,100 … $24.00 $17.50 $6.50 1895 1896 1897 1898 1899 1900 1901 1902 1903 1904 1905 1906 1907 1908 1,300,300 1,117,600 1,630,000 1,977,900 2,271,100 2,385,000 2,872,900 2,941,300 2,991,800 2,283,800 3,375,600 3,977,800 3,632,700 1,921,500 1,400 7,800 … … 2,000 1,500 1,900 63,500 95,500 37,700 17,300 5,000 4,000 1,700 $24.00 $28.00 $19.60 $17.60 $28.10 $32.30 $27.30 $28.00 $28.00 $28.00 $28.00 $28.00 $28.00 $28.00 $20.00 $21.00 $21.00 $23.50 $26.80 $36.00 $29.50 $27.40 $28.00 $22.50 $28.80 $31.20 $32.00 $29.10 $4.00 $7.00 –$1.40 $5.90 $1.30 –$3.70 –$2.20 $0.60 $0.00 $5.50 –$0.80 –$3.20 –$4.00 –$1.10 Duty $17.00 Oct ’90 $13.44 Oct ’90 $13.44 $13.44 $13.44 Aug ’94 $7.84 Aug ’94 $7.84 $7.84 $7.84 $7.84 $7.84 $7.84 $7.84 $7.84 $7.84 $7.84 $7.84 $7.84 $7.84 $7.84 Aug ’09 The figures for production and importation are from the Reports of the American Iron and Steel Association The American prices are from the same source, but have been reduced to a gold basis for the years 1871–78 The English prices have been secured partly from occasional tables given in the Iron and Steel Association reports, partly from English http://accountingbookspdf.com/ 353 Appendix sources The American prices are those for rails at the mills, in Pennsylvania; the English are for rails free on board Prices by yearly averages can indicate only the general fluctuations; but they suffice for purposes of comparison Where the imports are less than 1000 tons in any one year, they have been omitted Since 1888 the imports have been sporadic, and signify little Cost of transportation from England to the United States has been usually somewhere between two and four dollars a ton But sometimes it has been considerably less than two dollars; and carriage by water from England to places on the seashore in the United States has not infrequently been cheaper than carriage by land from the American rail-mills to such places It will be observed that there were three periods of active railway building and of heavy imports of rails: 1871– 74, 1879–82, 1886–88 During these years or parts of them, prices of rails in the United States were higher than those in England by the full amount of the duty for the time being In most other years they were higher, but by an amount less than the duty, and imports ceased, except for sporadic shipments of special sizes or kinds In the later years, the American prices came nearer and nearer the English prices In 1897, prices fell abruptly in the first two months of the year, in consequence of a “steel-rail war,” marking the breaking up of the combination which had so long kept prices up After that year, prices were no higher in the United States than in England Exports were considerable, much exceeding the imports http://accountingbookspdf.com/ 354 Tariff History of the United States / Taussig http://accountingbookspdf.com/ 355 Index INDEX A Cleveland on the tariff, 216, 219 does not sign act of 1894, 248, 272 Coal, duty in 1872, 160 in 1894, 254, in 1897, 290n, 320 in 1909, 320 Coffee free in 1846, 101 duty reduced, 155 repealed, 159 expediency of, 159 Colonies, industrial state of, 16 Compensating system on wool and woolens, 170 abolished 1894, 250 reestablished 1897, 282 Compromise tariff of 1833, 98 Conference committee on tariff in 1883, 199 in 1890, 247 in 1897, 278–79 in 1909, 317 Copper, duty of 1869, 189 of 1883, 209 of 1890–97, 232, 291 Cotton gloves, duty of 1909, 402 Cotton goods, duty of 1816, 33 of 1864, 166 Adam Smith quoted, 307 Ad-valorem duties, 138, 258–59 Ad-valorem duty on woolens, 179, 250, 258, 288n, 332 Agricultural products duty of 1883, 212 duty of 1890, 233–34 in 1909, 310 Aldrich on tariff of 1909, 317 B Bar-iron duty of 1883, 208 in 1864–83, 348 Beet-sugar and protection, 334 Blankets, duty of 1867, 173n, 185 of 1883, 250 C Canada’s tariff relation to U.S in 1909, 338 Carpets, duty of 1867, 184 of 1890, 227 Carpet wool, duty of 1867, 174–75 of 1883, 204 of 1890, 220 of 1897, 282 Charcoal iron, 51, 115 Clay and the tariff, 68, 76, 85n 355 http://accountingbookspdf.com/ 356 Tariff History of the United States / Taussig of 1883, 202, 206 of 1890, 227 of 1897, 285 of 1909, 314, 326 Cotton manufacture 1789–1824, 29 under tariff of 1833, 118 in 1846–60, 140 Cotton stockings, duty of 1890, 228 of 1909, 285 Crisis of 1818, 26, 64, 74 of 1837, 102–03 of 1857, 104 of 1893, 273, 276 Cuban sugar at reduced duty, 336–37 Cutlery, duty and manufacture, 290 D Dawes on tariff of 1872, 157, 160 Democratic party on tariff in 1883–90, 217 victorious in 1890–92, 243 divided in 1896, 273–74 Dress goods for women, duty of 1883, 201 of 1890, 225 E Earthenware, duties in 1890–97, 56, 289 F Finkelnburg introduces bill of 1872, 158 Flannels, duty of 1867, 178, 185 of 1883, 207 Flax, duty of 1828, 80, 92 of 1870, 195 of 1890, 235 of 1894, 254 of 1897, 289 Foreign trade in 1792–1815, 18 after 1816, 26, 28 under tariff of 1846, 107 Frelinghuysen on copper act of 1869, 190 Fruits, duty of 1909, 314 G Garfield on tariff in 1870, 155 German protests on tariff of 1909, 312 Glass, duties in 1890–97, 289 Gloves, duty of 1909, 314 H Hardware, 130, 326, 331 Harris, B., on woollen duties, 173 Harrisburg convention of 1827, 75 Harrison elected in 1888, 218 defeated in 1892, 243 Hawaiian sugar free, and effects, 238, 335 Hayes, J.L on act of 1872, 158–59, 163 President of Tariff Commission of 1882, 198 on tariff of 1883, 207, 212 Hemp protected in 1789, 22 duty of 1828, 81, 92 character of culture, 81 http://accountingbookspdf.com/ 357 Index Hides admitted free in 1872, 160 subject to duty in 1897, 282, 319n free again in 1909, 319 Home-market argument after 1818, 61, 70 Horizontal reduction in 1833, 98, 105 in 1872, 160 proposed in 1884, 215 Hosiery manufacture before 1860, 127 See also Cotton Stockings and Knit Goods I Imports, 1860–1907, 345 Imports affected by duties, 105, 160 Imports and exports, 1791–1814, 19–20, 28 Internal-revenue acts of 1862 and 1864, 140, 142 Internal taxes repealed, 150 Iron, duties of 1816, 48 of 1818, 49 of 1824, 49 of 1828, 80, 108, 230 of 1846, 109 of 1870, 155 of 1883, 208 of 1890, 231 of 1894, 256 of 1897, 289 of 1909, 324 Iron manufacture in the colonies, 46 in 1789–1808, 47 under acts of 1842 and 1846, 113 since 1870, 230, 256, 292 Iron-ore, duty in 1861–83, 202 in 1890, 231 in 1894, 255 in 1897, 290 in 1909, 320 Iron rails free in 1833, 53 J Jackson party and tariff of 1828, 77 Jefferson on protection, 21 “Jokers” in tariff of 1909, 317, 402n Jute free in 1890, 235 K Knit-goods, duty in 1890, 228 in 1909, 327 L Labor cost and duties, relation between, 307, 330 Lead, duty in 1890–97, 291 Leather duty reduced in 1909, 325 Linens, duty in 1890, 229 in 1894, 254 in 1897, 288 Lowell founded, 35 M Madison on protection, 21 Mallory and the tariff of 1828, 75n, 78 Marble, duty of 1864–70, of 1883, 211 http://accountingbookspdf.com/ 358 Tariff History of the United States / Taussig Maximum and minimum rates in 1909, 340 Michigan and beet sugar in 1909, 334 Mills bill of 1888, 217 Minimum duties of 1816, 33, 69 proposed in 1820 and 1824, 70 in 1827, 73, 75 in 1828, 82, 91 in 1890, 230 discussed, 73, 91, 230 similar system in 1890, 230 Molasses, duty of 1828, 83, 88 Morrill, J.S on tariff of 1861, 139 tariff act of 1864, 142, 151 on marble duties, 193 Morrison bill of 1876, 165 tariff act of 1884–86, 215 on act of 1883, 199n N Nickel duty, 195, 211 Nippers and pliers, duty raised in 1909, 339 North, S.N.D., 332 P Payne on tariff of 1909, 311 Philippine sugar free in 1909, 335 Pig-iron See Iron Plate-glass duties, 289 Politics and the tariff of 1828, 75 Porto Rico sugar free, 336 Power loom introduced, 33, 43 Printing paper, duty of 1897 and 1909, 321, 322n Prosperity affected by tariff?, 244, 270, 305 Protection feeling in 1789, 21, 63 after 1808, 23 in 1816, 24, 63 strong after 1818, 23, 64 decline after 1832, 59, 93 after the Civil War, 151, 151n, 164 in 1909, 344 Protection to young industries argument for, 11 applicable to steel rails and copper, 210 R Raw materials, effect of remitting duties, 322 Razors, duty of 1909, 327, 331 Reciprocity provisions of 1890, 238 of 1897, 298 abolished in 1909, 343 Reed rule of 1883, 199n Remissions of duty, effect of partial, 238, 335 Revenue duties abolished, 163, 235 Revenue from customs and internal taxes, 350 Revenue from tariff uncertain, 300–01 Rice, A.H., on tariff of 1851, 138n Rolled bar-iron duty on, 55, 57, 111 first made in U.S., 115 S Salt duty reduced, 160 Seward on tariff of 1857, 101n Sherman on tariff of 1861, 138n http://accountingbookspdf.com/ 359 Index on tea and coffee in 1875, 190n Shingles, duty raised in 1909, 318n Shoes, duty reduced in 1909, 326 Silks, duty in 1883, 211 in 1890, 229 in 1894, 254 in 1897, 285 in 1909, 287n, 328 Silver question and the tariff, in 1896, 274 Sinking fund in 1875, 164 South against protection after 1820, 67 on lumber duties in 1909, 323 Specific duties under act of 1833, 98 in 1861, 138 in 1894, 259 Steel duty in 1883, 191 Steel rails, duty of 1870, 191 of 1883, 208 of 1890, 232 of 1894, 257 of 1897, 290 of 1909, 324 growth of manufacture, 293, 324 statistics, 351 Sugar duty repealed in 1890, 235 bounty on, in 1890, 236 on raw sugar restored in 1894, 263 duty in 1897, 295 duty in 1909, 334 reasons for and against, 260 new conditions in 1908, 334 on refined sugar, and the Sugar Trust, 264, 296, 333 Sugar, figures as to, for 1890 and 1908, 337n Structural steel, duty raised in 1909, 339 T Taft, President, attitude on tariff in 1909, 306, 318 Tariff act of 1789, 21 of 1816, 25, 63 of 1824, 68 of 1828, 80 of 1832, 90, 98 of 1833, 98 of 1842, 100 of 1846, 101, 136 of 1857, 102, 137 of 1861, 137 of 1862, 140 of 1864, 142 of 1870, 155 of 1872, 160 of 1875, 164 of 1883, 200, 212 of 1890, 219, 241 of 1894, 243, 270 of 1897, 273, 279 of 1909, 305, 343 Tariff bill of 1820, 64, 66 of 1827 (woollens), 72 of 1867, 153 of 1872, 158 of 1878, 1879, 165 of 1883, 226 of 1884, 1886, 216 of 1888, 217 http://accountingbookspdf.com/ 360 Tariff History of the United States / Taussig Tariff board or commission of 1909, 341 Tariff commission of 1882, 198 Tea free in 1846, 101, 241n duty reduced, 155 repealed 1872, 235, 347 policy of, 161 Ten per cent reduction of 1872, 158, 164 Tin plates, duty in 1861–90, 233 in 1894, 258 in 1897, 294 “True principle” of protection as proclaimed in 1909, 306 Trusts and the tariff, 264, 306 V Van Buren and tariff of 1828, 85, 88, 89n W Wages argument appears about 1840, 60 its position in 1909, 309 Walker; R.J., and tariff of 1846, 101 War finances, 138, 154 Webster and tariff of 1828, 88, 89 Wells, D.A on internal taxes, 142 prepares bills of 1867, 153 on copper veto of 1869, 190n Wharton, J., on nickel duty, 195n Wheat, exports of, 1803–20, 28n Whitman, Wm., 332 Wood, F., introduces bill of 1878, 165 Wood pulp duty in 1909, 321 Wool and woollens, duties of 1816, 41, 69n of 1824, 41, 69n of 1828, 81, 83 of 1832, 91, 92 of 1846, 101 of 1857, 129 of 1861, 170 of 1864, 171, 172 of 1867, 174, 176 of 1883, 201, 204, 206 of 1890, 219, 222 of 1894, 249 of 1897, 279, 284 unchanged in 1909, 332 Wool, cheap, admitted at low rates, 81 Wool duty, economic aspects of, in United States, 204, 220, 249, 279 Wool, duty in England repealed 1824, 72 Wool tops duty, 332 Woollen dress-goods, duty of 1883, 200 of 1890, 226 of 1897, 283n, 332 Worsted manufacture, 128 Wright, Silas, on tariff of 1828, 85 Y Young-industries argument, 11, 24n, 59 Z Zinc ore, duty raised in 1909, 314 http://accountingbookspdf.com/ http://accountingbookspdf.com/ http://accountingbookspdf.com/ http://accountingbookspdf.com/ .. .The Tariff History of the United States http://accountingbookspdf.com/ http://accountingbookspdf.com/ The Tariff History of the United States By F.W Taussig Henry Lee Professor of Economics... the swelling the of the carrying-trade The price of flour shows the effect on the prices of agricultural produce The influence of the temporary stoppage of the war in Europe during the time of. .. http://accountingbookspdf.com/ 20 Tariff History of the United States / Taussig The tariff legislation of this period was naturally much influenced by the direction taken by the industries of the country The peculiarly