War as a Free-Trade Counteractant. The reductions made in the Tariff of 1913 have been for the most part negatived by the war. With millions of men diverted from productive industries to the work of destruction Europe is unable to send commodities here, and at the same time is in need of unprecedented quantities of our products and provisions. Here is the ideal condition sought by extreme high Protectionists, who deny that commerce is barter and that in the long run exports and imports must be equal. In payment for goods already purchased in this country Europe has sent us all the gold she can spare and we have no need of more.-New York Herald. It is indeed an ideal condition, so far as it goes. To the limited extent that the war has negatived the damaging effects of the Underwood Free-Trade Tariff, the condition is that much nearer the ideal than it was in the ten months prior to the war when Europe was flooding this country with industrial products and depriving three million American workmen of their jobs. That the war has helped somewhat in slightly checking this inflow of products that displaced the products of domestic labor and industry, Protectionists do not deny. They are glad of the check, much as they deplore its cause. But there are no "extreme high Protectionists" who deny that commerce is barter, in so far as goods exported are counterbalanced by goods imported. This, however, is indirect barter; more a matter of bookkeeping than of barter. We do not export three billions of our products in exchange for three billions of foreign products. We sell our exports for money, not for goods. If we sell more than we buy, we collect the difference in cash, or, as is now happening, we purchase back American securities held abroad and so cut down the debt of six or eight billion dollars which we owed to foreigners when the war broke out. Just now we are getting a good deal of foreign gold-not goods-to make up the difference between what we sell and what we buy. That is because the foreigners prefer to part with their gold, rather than let go of our securities. Already some hundreds of millions of these securities have been sent back to us in payment for our exports, and more will be sent back when the drain of European gold has become so great as to necessitate another form of payment. The Herald's own statement that "in payment for goods already purchased in this country Europe has sent us all the gold she can spare" is an admission that commerce is not all barter, and that our exports are not paid for by our imports, but the excess of exports must be paid for in gold or in credits. This is for any country an excellent condition, to sell its products abroad and establish healthy trade balances by selling more than it buys. That is what we were doing in sixteen years of Protection prior to the enactment of the Underwood Free-Trade Tariff. Soon after that law was passed we found our trade balances fading away and our European credits rapidly chang ing to debits. The war has turned the scale in our favor again. Free-Trade did not do it. Protection would not have needed the greatest human slaughterhouse in the world's history to help us pile up huge trade balances. Free-Trade did need it. More's the pity. Plenty of Money-but. The fact announced by the Comptroller of the Currency that the present unemployed loaning capacity of the national banks is the largest in the history of the country does not strike the Evening Telegraph of Bucyrus, O., as indicative of prosperous conditions. On the contrary: Idle capital means that investors are not mak ing dividends, and the average person may not feel a very serious interest in that, but idle capital also means that labor is not being employed to the limit that might be desired. It is undoubtedly true that never before was there so much money in the bank vaults ready to be loaned. Also it is true that there never was a time when it was more difficult to borrow money for legitimate business uses. So it turns out that a country may be loaded up with money and yet, under Free-Trade conditions, be far from prosperous. Never. A correspondent of the New York Evening Post, who maintains that "the Tariff has about as much to do with the prosperity of a country as the President's eyes," has the following to say concerning the latest fad of George W. Perkins: The proposal of Mr. Perkins, to have a "nonpartisan scientific permanent Tariff commission,' ought to be in a humorous paper, for a Tariff that is non-partisan is almost as easily accomplished as a poison without toxic effects; and what is meant by a "scientific" Tariff is probably known to your correspondent only. Perhaps we can enlighten the gentleman. A "scientific" Tariff is a Tariff that suits the fellow who frames it, and nobody else. At about the same time that the Tariff is taken out of politics it will be possible to have a "scientific" Tariff that will please everybody-that is, never. Up and at 'Em! Want to hear the whistle blowin', All the country through? Men, it's up to you. You know what has caused stagnation Rough indeed your lot. You know why there came disaster Free-Trade brought the blight. Why and Because. CHICAGO, August 26.-Stocks of merchandise at distributing points are generally so low that merchandise of all kinds must be bought in liberal volume to supply the trade necessities. Tradesmen have run on low supplies, fearing that something might happen.-New York Evening Post. Why are stocks of merchandise so low? Because, since the passage of the Underwood Free-Trade Tariff, merchants have stopped carrying large stocks and have done only hand-to-mouth buying. Why do the merchants buy less than formerly? Because their sales have dropped off. Why have the sales dropped off? Because the pay envelopes of American wage earners are fewer and thinner. Why are the pay envelopes fewer and thinner? Because the Underwood FreeTrade Tariff threw 3,000,000 American work people out of their jobs. When will the merchants again buy liberally? When the pay envelopes are thicker and more plentiful. When will that be? Very soon after March 4, 1917, when a Protection President and Congress shall have come into control of national affairs, when an extra session of Congress shall have been called, and when an adequately Protective Tariff shall have taken the place of the present business-wrecking Free-Trade Tariff. No Basis for "Reciprocity." It is announced from Washington that the Federal Trade Commission is about to take up the operation of enlarging our trade with the countries of South America. Among the subjects to be treated is that of "reciprocity," wherein. as the Underwood Free-Trade Tariff provides, "mutual concessions are made looking toward freer trade relations." Upon what basis can such concessions be made? The present Free-Trade Tariff law leaves little or no room for concessions on the part of the United States. Practically all of the products which the South American countries export to our own country are already on the free list. Wherefore there can be no Tariff concessions so far as this country is concerned. The only "concession" that we can make from a Free-Trade Tariff would be to grant a cash bounty on importations from South America. Perhaps the enlightened statesmanship at Washington contemplates this step as an additional temptation to foreigners to increase their export of agricultural products to the United itates. It is good luck for the administration that the war has halted importations and sent orders here which otherwise never would have been given. But the cold facts and figures repu diate the Tariff policy of the Democratic party, which has failed to fulfil its promise to the people.-Mt. Vernon (Ind.) Republican. THE TRUTH TOLD BY A GERMAN EXPERT. Herr Waetzoldt's Report to the Imperial Correspondence AMERICAN ECONOMIST. WASHINGTON, September 2.-The New World, the leading Democratic organ in the United States, in publishing correspondence of German agents in the United States has given prominence to impartial arguments in favor of Protection which might be expected to have some influence upon the present Democratic administration in Washington. Herr W. A. Waetzoldt, the industrial trade representative of the German Empire, makes the following statements in one of his reports: The complete stopping of importations of German products will, in truth, to a limited extent, especially in the first part of the blockade, help the sale of English and French products, but the damage which will be done to this hour will not be great. That part of our sales here which is lost to us in this way will, as soon as we can deliver again, be recoverable without serious difficulty. us in Predicts the Return of Protection. Thus the Germans have concluded, as most other foreign nations have done, that under the present Tariff laws of the United States it will be a very simple matter to resume the dumping of their products upon the American market once the war is over. Again, the industrial expert of Germany, as a result of his careful investigation into the movement for the restoration of Protection, makes this prediction: The war certainly will have this effect, that the American business world will devote all its energy toward making itself independent of the importation of foreign products as far as possible. The representatives of the people of the United States will, by means of Tariff laws and suitable administration of the same, help to suppress the importation. The Truth About American Business Conditions. It is essential that the German Government should have correct information amout American business, and stress is laid upon the report of Herr Waetzoldt's careful analysis of American trade conditions, because there can be no suggestion that his opinions are influenced by a desire to help the Protectionist cause in the United States. With reference to American business conditions he reaches the following conclusion: Pertinent estimates are being made that at least 50 per cent. of the capacity of American industries engaged in the manufacture of ma chines and metal work are occupied in the production of munitions of war, and that of the remaining 50 per cent. at least 30 per cent. of the capacity is needed for the production of the necessary materials. Even with the help of "war orders," however, a considerable part of the American industries is not as yet on the average fully occupied. The large war orders, as the professional journals also print, have become the great means of saving American business institutions from idleness and financial ruin. That is not only true of the average and smaller institutions, but also of the larger ones, of which a number have entered into the delivery of war munitions within the last month. The fact that institutions of the size and international influence of those mentioned could not find suffi cient regular business to keep them to some ex- Revenue Lost in Seven Months. to work hard and at the lowest wage. As the Wilson administration stands to-day, it stands to welcome the product of this cheap foreign labor as soon as hostilities cease. Our duty is to unite forces and to proceed immediately to the repeal or revision of those laws which, when the competition of Europe again is free, can only humiliate us financially and economically. Sufficient as a Revenue Producer. The three laws enacted by the last Congress to raise money, namely, the Tariff, income tax and "war tax" laws, signally failed to produce the needed revenue to run the government. This in itself is an unintentional but clear admission of the inefficiency of the Underwood Tariff as a revenue producer. The unassimilable Tariff legislation enacted by the Wilson administration simply gives away our rich home market to the commercial depredations of foreign manufacturers. In seven months, from January 1 to July 31, 1914, the loss of revenue under the Wilson-Underwood Tariff law, as compared with the repealed Protective Tariff law of the previous year, was upward of $23,000,000. This loss occurred before the present European war had fairly started. The damage to the country during that period was enormous and foreign manufacturers displaced $248,000,000 worth of American labor. That, however, was only the beginning. The whole argument in favor of the Free-Trade low Tariff system was based upon the alleged control of trusts and monopolies and the high people, however, are unaware of the lacost of living. The cost of living is higher now than at any previous time. In commenting upon the deplorable business conditions effected by the enactment of the Underwood Tariff Congressman J. Hampton Moore, of Pennsylvania, recently said to the writer: Added to Profits of Foreign Manufacturers. By admitting the goods of foreign cheap labor free of duty and at such rates of duty as made American competition impossible, the Wilson Tariff law cost the American treasury a full $100,000,000 of revenue the first year. The retail price of foreign commodities was not reduced to the American consumer, but added $100,000,000 to the profits of the foreign manufacturer, who was thus able to take work from the American workingman. If anyone thinks the cost of living has been reduced by Mr. Wilson's plan of reducing the Tariff and lowering the artificial barriers which check competitive imports, all he has to do is to compare the prices of 1915, in the heyday of the Wilson administration, with the prices of household commodities in the closing days of the administration of Mr. Taft. The advantage in prices is with all Europe, not the United States. War Tax Carried in Time of Peace. In times of peace we never had to impose a war tax before, certainly under no Republican administration, but here, in spite of all promises of relief, an unwarranted burden of $100,000,000 direct tax was levied upon the consumers of the land. Although this war tax in America was blamed upon the war in Europe, no man who understood the financial situation prior to the war failed to observe that the present adminis tration was incompetent to manage our finances on a "Tariff-for-revenue-only" basis, and that form of direct taxation was inevitable. Don't forget also that the country was in financial distress before the European war broke out and that all industry and enterprise was losing confidence. some War Does Not Excuse Free-Trade Blunders. The European war does not excuse the Democratic party from using up the $50,000,000 bal. ance that was left in the Treasury when Mr. Wilson took hold. It does no excuse the deficiency that now exists in the treasury-that is to say, the excess of expenditures over receipts that eventually must lead to an issue of bonds or additional taxes. It does not excuse the tendency of all legislation of the past two years toward Government ownership and the destruction of private enterprise. It does not excuse fake anti-trust legislation, injurious shipping laws, and the deliberate destruction of American shipyards by the proposed use of American taxes to purchase foreign vessels. Soldiers Will Go Back to the Mills. Remember that the moment the war in Europe stops the men who are in the trenches will go back to the mills. It will be necessary for them It is not believed that the American mentable condition of American business precipitated by the near Free-Trade Tariff, nor that they will fail to use the ballot in a manner which will eliminate the proponents of such blundering and ill-considered legislation out of political existTHOMAS F. LOGAN. ence. The War Takes the Place of a Tariff. As to the home market, the war takes the place of a Tariff, and a very high Tariff at that. Before the war important lines of American manufacture were suffering greatly from the effects of the Democratic Tariff and the weakest seemed likely to be forced out of business. The holding of our domestic markets will be a matter of legislation. So will the foreign trade, for that matter, but assuming legislation which will put Americans on an equality with foreign competitors, there will still be serious problems. Trade in war materials is profitable while it lasts, but a sudden peace would disorganize American industry almost as badly as the outbreak of the war. What would those do who are now manufacturing powder and shot if peace were declared next week? I The war trade is merely a stop gap. With return of peace we shall be just as we were before, subject to whatever impairment of energy and resources our belligerent competitors may have suffered. Let no one deceive himself. No destruction by war is possible which will not be replaced by a year or two of peace. And if one imagines that the prodigious debts which will be outstanding will impair ability to compete in trade, let him remember that it is only by increased energy in industry and trade can those debts be met, and that both the nations and their creditors will agree in financing the means of paying debt before providing for any other object.-San Francisco Chronicle. A TARIFF COMMISSION WOULD FAIL. So Says Member of Board of Managers of American Protective Tariff League. George R. Meyercord in the Manufacturers' News, August 19. For years I have been interested in the Tariff question. I am chairman of the National Association of Lithographers' legislative committee, which has Tariff matters in charge. I have gone through two of the Tariff revisions on behalf of this industry. My experience has taught me that there is only one safe way in which to make a Tariff schedule, and that is on custom house displacement records. An automatic Tariff commission is perfectly feasible by co-ordinating the American Industrial Census with the Department of Commerce records on imports. This does not require a commission. It requires a bunch of intelligent clerks in the existing departments of the Government. While the present Census Bureau is going to attempt in a limited way to conform to the scheme, yet the existing situation is such that a real balancing of the Government books of commerce is practically impossible, partly due to the limited expenditure allotted the Census Bureau, and also due to the fact that the different bureaus of the Government are not properly co-operative and won't lend their full support; and then, also, their own records are possibly insufficient. One True Standard. But the Department of Commerce has one true standard to go by, and that is the classification according to the Tariff law. We now come to my objections to a "Permanent Non-Partisan Tariff Commission." 1. In the very nature of things men will be partisan on the question. 2. While the American Government can compel American manufacturers to show cost, the American Government has no control over foreign producers. Consequently, how can a commission get at the true facts of foreign cost? It's perfectly absurd to expect the German or British Government to send agents into our office and demand to see our books of cost. We'd laugh at them, and it's equally true that the German, French, Belgian or English manufacturers do laugh at the demands of an American commission to investigate their cost records; and, therefore, without this privilege, no percentage of cost records can be gotten at as between foreign cost and American cost. Germany or Japan? Again, let me raise this point: What is a foreign country? Germany is one, so also is Japan, or India. In Germany the cost may be twice as high as it is in Japan, and yet the German goods might capture our market, while the Japanese would hardly get a foothold, even though much lower. The controlling element may be style, or designing. For instance, let me illustrate. Japanese silks may be designed with patterns totally unsuited to this market. Therefore, the cost of production has no basis in fact, no bearing on the issue. This applies to many industrieschinaware, glassware, textiles of every nature. Therefore, the cost of production theory is a fallacy. This brings you right back to custom house records. Custom house records are the only true index, and it's absurd to talk of a Tariff commission to investigate costs and draw their conclusions from costs; for, as stated above, the foreign manufacturer won't let you investigate his books; and then again, if you did do the investigating, then the element of designing comes in and clearly upsets all your cost calculations. Custom House Displacement. It resolves itself flatly into a question of custom house displacement records. The departments of the Government at the present time are perfectly competent to balance the books, provided a uniform system of bookkeeping is installed. By that I mean to say that the domestic commerce must be classified-that is, the domestic production must be classified according to the Tariff law in vogue so as to get true displacement records. out the domestic manufactures being classified according to the same classification in vogue on imports, you'll never get anywhere. A commission would be perfectly helpless, and what errors have appeared in the previous Tariff laws are very largely attributed to the simple fact that our industrial books have never been balanced. We never get the same sort of records. With Furthermore, let me explain by example what would happen to an average industry should a commission make a ruling. First of all, the commission could not make a ruling that would be binding on Congress. Congress has the sole power to make a rate, because it has the sole power to raise revenue; and, of course, this comes under the head of revenue. It would require a constitutional amendment to give a commission the power to make a rate. Plight of Small Industries. Now then, let us bring home this example: You will remember last summer the Interstate Commerce Commissionprobably the ablest commission we have -threw down the railroads on the five per cent. freight rate increase, and four or five months later reversed itself and granted the rate. Either it was right in the first place or it was wrong, or vice versa in the second case. It took years for the largest single investment of capital that this country knows-the railroads -to get a decision from a commission. What would happen to a little industry, let us say, where there are 4,000 or 5,000 people employed? Let us take pearl buttens, for instance, the manufacture of celluloid, or any one of the thousands of industries that represent $5,000,000 or $10,000,000 of capital. Supposing a commis sion recommends a lowering of the existing rate. The domestic manufacturer feels that he knows more about the business, which is usually the case. Supposing the commission recommended that the rate be reduced from 50 to 25 per cent. The commission could only recommend this rate to Congress. Congress in its wisdom wouldn't see fit to act for two years. and would throw it into the next Congress; a fight would start and two years more would elapse; Congress wouldn't act. Panic Conditions Would Exist. In the meantime panic conditions would exist in this industry. The manufacturers in the industry would have the blues so badly that the industry would totally stagnate. They know full well that they couldn't get a decision for two or three or four years; they know that the report is hostile to them; the chances are that the air around the various establishments would be permeated with the blues so badly that the banker and everybody else would be affected; they couldn't raise money; they certainly wouldn't enlarge and they couldn't sleep industrially any more than you could with a sword hanging over your head. Sit Down and Do Some Thinking. Now, here's the nub of the whole matter-so far as we of America are thus far concerned: we're selling Europe millions of dollars' worth of stuff-stuff that we couldn't have sold her had there been no war; and she's selling us very littlewhere she would have been selling us very much had there been no war. The war has given an immense balance of trade in our favor; it has saved us from a period of trade depression such as we have never known. Democratic Tariff reduction was in favor of Europe-and against our own country. Hard times were coming in this country before the war broke out; but the war checked the thing very materially. Times are not very brisk as it is; but what would have been our plight had the war failed to come? You low-Tariff advocates, sit you down -and do some thinking.-Columbus (0.) Saturday Monitor. The Tariff rates in Protection America were cut all to pieces by the Underwood-Woodrow Wilson bill, and then Canada increased its rates nearly 10 per cent. Its exports to the United States have increased by leaps and bounds, and our imports to Canada have decreased in proportion.-Lawrence (Mass.) Critic. FORCED INTO MAKING WAR MUNITIONS. Underwood Free-Trade Tariff Left Ameri- Bucyrus (O.) Evening Telegraph, August 20. The answer of the United States to Austria is the only one that our country could make. There are few of us here who really approve of the munitions business. But Austria is the last country in the world to have made the "request" that we discontinue the shipment of arms to belligerent nations. The question is in reality not one of international law, because there is no law to prevent this selling of manufactured goods to the warring nations; if it is to be settled at all it must be on the bigger plane of humanity. However, there is no question of the rights of American manufacturers to find a market for what they make, and sell their products to the world, wherever they have a market. It must be remembered this is now a Free-Trade country. Our people elected an administration that advocated the free exchange of goods wherever a market might be found for them. A Congress elected on a Free-Trade platform enacted laws which gave Free-Trade to this people. And in removing the Protecting influence of a Tariff this administration threw down the bars to the manufacturers of the Old World, giving them equal opportunity to our markets, making manufacturing here a disadvantage, and giving all the advantage to the laborers of Europe and Asia, without regard to standard of living or standard of wage. The laws enacted by the present administration worked such a hardship on the manufacturers of this country that closed establishments and short hours were the rule. Throughout the country the smoke of factories ceased and the idleness of men increased. When it became possible to secure contracts for munitions of war, it found our greatest factories struggling to keep the fires going; they were making an effort to employ their forces under the readjustment necessary because of "Tariff tinkering." The present administration forced the manufacture of munitions of war upon the manufacturers of this country in order to keep their factories running. The crime is at their doors, they are the ones who have made it necessary to accept this line of business whether it was wanted or not; the condition was made by the Democratic administration, and when President Wilson went into the halls of Congress, and by threats and promises forced on the country a Tariff law, which might have been vastly more just to our country but for him, he earned the embarrassing conditions which CHENEY have come to him; with the best of intentions, perhaps, he sowed the wind; it is right that he shall reap the whirlwind. Charitably extending to him the possible purpose of accomplishing good it must be recognized that he really helped in creating a condition which forced the manufacture of munitions of war, and on him and his friends must rest the responsibility, and on them must fall any blame if blame there be. If it is wrong, morally and ethically, for manufacturers to furnish war munitions the crime is directly chargeable to the present national administration-not to the manufacturers. SILKS For everybody and every purpose-Manufacturer or Merchant, Man or Woman. Cheney Brothers, 4th Ave. & 18th St., New York F.A.RINGLER GO. LECTROTYPING PHOTO ENGRAVING. OFFICE 39-41 Barclay St to 40-42 Park Place Uptown Branch-207-217 W 25 Street. NEW YORK MADE IN AMERICA Trade COLLARS Marks SHIRTS EARL & WILSON MAKERS OF Troy's Best Product The People Get What They Vote For. The people rule and they get what they vote for-prosperity or adversity. It is the same old contest that confronted the people in 1860, that elected Lincoln, Grant, Benj. Harrison, William McKinley, Roosevelt and Taft, and those standpatters and their principles aided in promoting the world's best and most prosperous government. Thrice in that period the jawsmiths and destructionists elected Presidents, and twice destructive Congresses, and the periods of the Nation's greatest distress were in 1893-1897, and under the present low Tariff policy that gives preference to Asiatic, African and European pauper labor. Those knocking on Republicanism to-day, as in 1912, are for the Wilson-Bryanism, and the issue is clear cut-for the party of prosperity; or for the party of low Tariffs, closed industrials, free soup houses as for past two winters, complications at home and abroad, higher income and war taxes, LADIES AND GENTLEMEN and a bankrupt treasury.-South Kansas (Kan.) Tribune. Should Seize Their Opportunity. Many of the leading Democrats are saying frankly that the Democratic Tariff is a failure. They favor a return to a higher Tariff in order that American industry and labor may be better Protected against the cheap labor menace from foreign countries. It is likely that the FreeTrade notions of the Democrats may prove more damaging to them than all their good qualities can offset. They should seize their opportunity now and do the logical thing: enact a Republican Protective Tariff.-Adair (Ia.) News. SMITH & DOVE Smith & Dove Mfg. Co. Manufacturers of Machine Threads FLAX and TOW YARNS "A Friend to Your Feet" Made in American Factory SOLD NOWHERE ELSE JAMES S. COWARD 264-274 Greenwich St., N. Y. (Near Warren St.) &c. I support the American Protective Tariff League because it advocates the principle that has developed commercially, our country to its present high standard. A prinicple that creates a condition that compells the utilizing of the metals, the coal, ores,& that lay dormant in the ground, and are of no value until they are worked into merchantable product. A principle that gives employment to the wage earner, and makes it possible to pay him the greatest possible return for his labor. A principle that makes it possible for the farmer to receive, by the employment of the wage earner, the highest value for his product. I believein it because it creates prosperity, which in turn, produces contentment and happiness to the American people. |