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and timely relief to many branches of industry, duties on imports. The basis of all values was especially 'crude petroleum, domestic sugars, a paper currency, the influence of which was clothing, boots and shoes, books, cordage, rail- felt immediately by those manufacturers that road freights, and the manufactures of steel, came into competition with the productions of iron, chains, cables, etc. The prices of the arti- other countries, whose basis of all values was cles, however, did not show a reduction cor- gold and silver. The condition into which these responding to that of the taxation; but on the industrial interests had been brought is chiefly contrary, in some instances, owing probably to shown by the advance in prices. The advance the fact that heavy taxation had previonsly in the prices of the leading articles of condiminished production to a point absolutely be- sumption and in rents indicates an increase of low the necessary supply, the prices seemed to nearly ninety per cent. in 1866, as compared have been concurrently advanced with the abate with the mean prices during the four years from ment of taxes. The tax on stock-brokers' sales 1859 to 1862. The advance in breadstuffs is was changed to one-hundredth of one per cent., estimated at about 70 per cent.; coal (anthrapayable by means of stamps affixed to the bill cite), 60 to 70 per cent.; salt fish, from 60 to or memorandum of each sale, with the most satis- 75; pork and beef, from 110 to 120; butter, factory results. Brewers of fermented liquors over 100 per cent.; rice, 100; salt, from 110 to were required to make monthly returns of the 120; soap, from 80 to 90; brown sugars, from product of manufacture, and to affix an adhesive 70 to 80; coffee, from 30 to 40; and teas, 140 paper stamp to each barrel sold, which was to to 150 per cent. The currency prices of textile be cancelled by the retailer. This plan proved cottons in October, 1866, show a nominal adto be a success in preventing frauds.

vance over the gold prices of such fabrics in But it is necessary to consider the present July, 1860, of 172 per cent. ; the advance in the tariff system of the country and its operation in gold prices in the same period having been 81 order to have a full view of all the elements per cent., assuming the premium on gold in *which enter into the financial condition of the October to have been 50 per cent. A portion Government and country. The rates of duty of this advance in these textiles must be attribimposed by the tariff in operation at the begin- uted to the advance in raw cotton, which varied ning of 1866, were about forty per cent. on the from 300 to 500 per cent. above the price in total value of imports, and about forty-three 1860. The advance in the cost of manufacturing per cent. on the values of those paying duty. goods in one of the Eastern mills in 1866 over The following table exhibits the annual imports the average from the years 1857 to 1861, and exports, and duties of the United States was 1333 per cent. On the manufacture of from 1859 to 1866 inclusive :

woollens suitable for ordinary domestic use, the

advance was estimated at 53 per cent. On silk Fiscal YEAR.

goods in general, the advance was estimated at ports. ports.

an average a little over 100 per cent., the lower 1859 $338,765,130 $356,789,462 849,565,824 grades having advanced at å still higher ratio. 1860

362,163,941 400,122,296 53,187,512 The average increase in the price of labor since 1861

350,775,835 410,856,818 39,582,126 1860 has been estimated at 60 per cent., al1862

205,819,823 229,790,280 49,056,398 though no very exact and comprehensive state1863

252,187,587 331,809,459 69,059, 642 ment can readily be made, owing to the varying 1864

328,514,659 340,665,580 102,316,153 1865 234,434,167 336,697,123 84,928,260

nature of the conditions which affect the esti1866 437,638,966 179,046, 630

mate. The following data in branches of man

ufacture show the advance from 1860 to 1866: So far as relates to the amount of revenue collected, no satisfactory reasons could be brought forward in support of a demand for

Agricultural implements..., an extensive change in the existing rates of Agricultural laborers in the Northern, Middle, and duty. Since the revision made in 1864, the rev

Western States, average.. enue has reached a point much larger than Boots and shoes Men's


87; to 50 was ever anticipated, and beyond which no material increase can probably be obtained except Car building Skilled mechanics, 60 to 75 perct.

First-class custom work..nearly by a large increase of importations. Reasons

Laborers, and unskilled, 60 per for a change of the existing rates were, how

Value of Im- Valne of Ex

Duties re



Advance in wages from 1860 to 1866.

Per cent. 55 to 60

Women's and children's..

50 25 to 38



China decorating... ever, urged from the condition and necossities Clothing-Ready made of various industrial interests of the country, especially those brought into competition with Copper mining......

Cotton manufactures - general average of all similar producing interests of other countries.

663 to 90 The condition and necessities of those industrial Furniture-Cabinet.

Hardware-Files.. interests demanding a change in the rates of

Locks. duty on imports, were not the results of the previous duties imposed, but the consequences Hats, wool and fur.

India-rubber manufactures of abnormal and unusual occurrences existing Ink, printing. in other departments of social affairs, and opera. Iron-Founding..

Rolling ting upon those branches of industry affected by Wire..


Custom work.

60 50 95 100



85 43 66 75 60 SO

78 50 to 60 75 to 80




47% to 50

Jute manufactures...

By the census of 1860, the average monthly Locomotives and machinery in Paterson, N. J., average .......

wages of those employed in all branches of Machinery, cotton and woollen, average..........

manufactures, was, of males, $27.10, and of feMachinery, general average..

males $12.50; while by the census of New Machinists' tools.... Paper hangings-Machine tenders and block cut

York in 1865, the average monthly wages in ters....

the whole State was, for males, $44, and for Hand printers.. Laborers....

females, $20; being an increase of sixty-two Printing-Composition........

45 to 50 per cent. for males, and sixty per cent. for feBaddlery and harness.

ezt males. The average advance in the rents of Ship-building.... Bilk trimmings, etc....................... nearly 100 houses occupied by mechanics and laborers in Ste: cotyping


the great manufacturing centres of the country Urr. Jrellas and parasols... Woollen goods Miscellaneous...................


is estimated to have been about 90 per cent. Carpetings...


The effect of this great increase of prices has The following estimates of the increased ad- and a partial suspension of the development of

been a decrease of production and consumption, vance in wages (1861–66), in the cities and the country. Thus a comparison of the industry States below named, were carefully made at of Massachusetts at the two periods of 1855 the instance of the Commissioner of Revenue, and 1865, in the articles of cotton goods, calico, by intelligent and reliable gentlemen :

woollens, paper, rolled and slit iron and nails, Advance in wages from clothing, leather, boots and shoes, mackerel and

cod fisheries, it appears that the decrease in the In all the manufacturing establishments in the

number of hands employed at the latter period town of Chester, Penn., the estimate average in

is about 11 per cent. Some of this decrease In Canton, Stark Co., Ohio..

57 may have arisen from labor-saving machinery. In the city of Worcester, Mass...

-87 But the gold value of the industrial products In the city of Baltimore, Md., carpenters......... Plumbers and tinners..

above specified, at the latter period as comWhile in all branches of industry, including

pared with the former, showed a decline of laborers as well as mechanics, the general

nearly 3 per cent. The cotton manufactures average increase is... In the State of Ohio, where the large majority con

of the two periods, other than calico, show a sists of farm laborers, the average is..


decrease in the number of bands employed of 31 In Massachusetts the increase in mechanics' wages is........

per cent., and in the quantity of raw cotton While that of all employés in this state, male

used 56 per cent., wbile the diminution of proand female, and including farm laborers, is.. In Western New York, the increase of wages of

duct was 47 per cent. and the average value of skilled farm laborers has been seventy-six per

the cotton goods per yard, showed an increase cent.; for month and day laborers, from fifty to

in gold in 1865 over 1855 of 75 per cent. The sixty per cent. ; for mechanics' labor, from ifty to one huodred per cent.

following table presents further details :


1860 to 1866.

Per cent.

crease is..








Corresponding illustrations are furnished in markets, with the products of other countries other parts of the country. Thus at Pittsburg, made from untaxed raw materials, having the Pa., the value of the manufacturing products of advantage of cheaper capital and lower wages of the city in 1859-60 were $42,805,500 in gold, labor. În nearly every departinent of industry and in 1865-66, $64,280,069 in currency, which the possession of the home market has become at an average gold premium of fifty per cent. seriously interfered with, while the ability to shows nearly similar results.

compete with foreign nations in foreign markets In consequence of the great advance of the is restricted to the sale of a few articles in prices of all labor and materials, the products which the American producer is largely faof American industry were exposed to a most vored by natural or accidental advantages, as unfair competition, both in the home and foreign in the case of cotton, petroleum, etc. The fol

owing table prepared at the Bureau of Statis- various articles during the fiscal year 1866, as ties shows the decrease in the exportation of compared with each of the previous five years.


But the decline of the various branches of respectively 69 and 71 per cent. The decline industry is clearly indicated in the shipping in- of the foreign tonnage of the country has been terest. The amount of American registered commonly referred to the war; but since this tonnage engaged in foreign trade in 1865-66 cause ceased to operate, the declining movewas 1,492,924 tons, while in 1859-'60 the ment has continned to prevail. The shipamount of this tonnage was 2,546,237 tons; building of the country had almost entirely which, allowing for the difference between the ceased during the latter part of the year. Preold and new measurement, indicates a decrease vious to 1860 abont one-half of the product of in five years of over fifty per cent. In 1853 the copper mines of Lake Superior was exported the tonnage of the United States was about 15 to France and Germany; now the proprietors per cent. in excess of that or Great Britain, of these mines represent that their whole inwhereas at the present time it is estimated at vestments are threatened with ruin through 33 per cent. less. The coastwise and inland failure to secure even the home market. commerce, by the official returns, after making During the year, flour from France and starch allowance for the difference of measurement, from Great Britain were imported into New shows a decrease of about 12 per cent. In the York and Boston to be sold at a profit. The Brazilian, or South American trade, in 1861-62, machinery for the manufacture of cotton and one hundred and ninety vessels were engaged, for refining sugar, is now in a very large proof which at present only thirty are reported as portion made abroad, as the price is about oneremaining, while the number of foreign vessels third less than that for which the same can be engaged in the same trade, has, during the same constructed in the United States. The value time, increased nearly threefold. One cause of of that in the course of construction in Euthis change was undoubtedly the frequent pres- rope at this time is estimated at three millions ence upon this part of the ocean of the Alabama of dollars. Notwithstanding the embarrassand other privateers. The number of vessels of ments to some manufacturing establishments, all classes engaged in the foreign trade which are they were kept in operation at the merest aprived at the port of New York during 1866 was preciable profit, and every expedient for econ4,892, of which 1,658 were American bottoms, omizing labor and perfecting profit was resorted and 2,410 British bottomg. The building of ships to. Other establishments continued to divide has to a great extent been transferred from the large profits among their stockholders, although Atlantic coast of the United States to the Brit- their exhibits were generally less favorable than .sh Provinces, where the tonnage, especially in for the preceding year. The following were the New Brunswick and Nova Scotia, during the dividends of somo manufacturing companies of five years ending June 30, 1865, has increased Massachusetts:

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Douglas Axe..
Dwight Mills.
Great Falls
Hamilton Cotton.
Hill Mill....
Jackson Company.
Lancaster Mills (par 400).
Langdon Mills...
Lowell Bleachery.
Manchester P. W.
Massachusetts Mills.
Middlesex Mills
Newmarket (par 700).
Salmon Falls (par 300).
Stark Mills....
Washington Mills.

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600,000 1,500,000 1,000,000

420,000 2,000 sh. 140,000

400,000 1,700,000

600,000 1,500,000 1,200,000 700,000 600,000 800,000 225,000

800,000 1,800,000 1,800,000 2,500,000

750,000 1,000,000 1,200,000

5 3 10 5 5 10 15 20 25

5 12 7

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CSIA aer

60,000 45,000 60,000 140,000 30,000 80,000 56,250 15,000 108,000 108,000 375,000

37,500 100,000 144,000




10 25

5 10 10 $50 12 10 3 5 10


600 sh. 2,500,000 1,000,000

600,000 1,250,000 1,650,000

42,000 300,000

75,000 125,000 165,000






The Special Commissioner of Revenue (Mr. mass of the community. Before the war the Wells) says: “ Although it is an interesting revenue of the Federal Government was about fact, that investigation under such circum- $60,000,000 annually, chiefly derived from cusstances should reveal any degree of national toms and land sales. No direct tax was levied progress, at the same time the demand for upon the people, except for State and local relief from the producing interests of the coun- expenditures, and these were moderate in try, both manufacturing and agricultural, is amount. But during the last year the Govmost urgent and general; and however it may ernment took from customs and internal revhave been heretofore, it is certain that at pres- enue alone nearly $500,000,000 from the peoent, in many descriptions of manufacture, the ple, while the State, county, township, and internal rates of taxation, superadded to the city taxes have also vastly increased. The high prices paid for raw materials and for prices of all articles of prime necessity have labor, sweep nearly all the profits into the cof- also greatly increased, while agricultural prodfers of the Government, and in many instances ucts generally have advanced little more than actually offer a bounty to the foreign com- the appreciation of gold. Wages are higher, petitor."

but the advance is not proportioned to the rise Those who find their industrial pursuits thus in rent, fuel, and household necessaries. The injured, or in danger of destruction by a for- Chairinan of the Ways and Means Committee eign competitor, were urgent that Congress of the House of Congress says: "A printer in should advance the rates of duty upon their Washington now gets $24 per week, and works manufactures. Such a measure might afford but eight hours per day, where he formerly rethem a temporary relief without exerting any ceived $14 per week, and worked ten hours beneficial influence upon the great problem be- per day, and yet he will tell you that his confore the country. No such advance of duties dition and means to support a family have not was required for the necessary increase of the been bettered.” The industrial classes have revenue, as has already been stated. Such legis- been growing worse off, able to purchase less, lation, therefore, could be sustained only upon and to save less; this poverty reacts on both the still disputed principle that it was the duty traders and manufacturers. of the Government, in all cases, to protect man The Commissioner of Internal Revenue thinks ufactures.

there have been three causes for the abnormal The special facts thus far stated relative to condition of the country, and suggests three the operation of the currency, the internal corresponding remedies. The first cause has revenue and tariff laws, present a very imperfect been a scarcity of skilled labor, which no legisview of the condition of the great industrious Jation can remedy, except by creating encour

National Debt



agement to immigration; the second cause has country he regards as one of adaptation rather been, as he suggests, the adoption on the part than principle. How shall the necessary rev. of the Government, as a measure of value, as a enue be raised under a system of internal and medium of exchange, and as a legal tender, of external taxes without sustaining monopolies, an irredeemable paper currency, the remedy without repressing industry, without discourfor which is a return to specie payment through aging enterprise, without oppressing labor? In the agency of contraction applied to the great- other words, how shall the revenue be raised est possible extent, and at the earliest possible in a manner the least oppressive to the people moment, compatible with the condition of the without checking the growth and prosperity industrial interests of the country, and of the of the country? To the legislation now republio obligations; the third cause, and per- quired, the Secretary of the Treasury recom. haps the most influential, has been the extent mended as a guide the following general prin. of the burden of national taxation, which is ciples : First, that the fewest number of thus illustrated:

articles now required, consistent with the

amount of the revenue to be raised, should be Taxation per

subjected to internal taxes, in order that the capita. per capita.

system may be simple in its execution, and as United States... $11.46 gold

little offensive and annoying as possible to the

$74.28 Great Britain.


125.00 tax-payers. Second, that the duties apon imFrance


53.00 ported commodities should correspond and Belgium.

26.00 harmonize with the taxes on home productions, Prussia.



and that these duties should not be so high as Austria...



to be prohibitory, nor to build up home monopThe remedy suggested by the Commissioner olies, nor to prevent that free exchange of comis such a reduction of the existing taxes as can modities which is the life of commerce. Nor, now be made compatible with the demands of on the other hand, should they be so low the treasury for expenditures, interest, and a as to seriously impair the revenues, nor subcertain reduction of the national debt.

ject the home manufacturers, burdened with The Secretary of the Treasury, embracing heavy internal taxes, to a competition with in his view the currency, as well as the systems cheaper labor and larger capital, which they of taxation, suggests five measures as remedies may be unable to sustain. Third, that the raw for the present condition of the country. In materials used in building and manufacturing, the first place he would compel the national and which are to be largely enhanced in value banks to redeem their notes as well at the com- by the labor to be expended upon them, should mercial centres as at their own counters. With- be exempted from taxation, or that the taxes out such redemption there would be practically upon them should be low in comparison with none at all until specie payments are resumed, the taxes upon other articles. Fourth, that the and where there are no redemptions there is al- burdens of taxes should fall chiefly upon those ways a constant tendency to inflation and ille- whose interests are protected by taxation, and gitimate banking. The frequent return of their upon those to whom the public debt is a sourco notes is needed to keep the business of the of wealth and profit, and lightly upon the banks in a healthy condition. The second laboring classes, to whom taxation and debt remedy suggested by the secretary is a curtail- are without so many compensatory advantages. ment of the currency by the withdrawal of the With these views upon the manner in which United States notes. The present banks hav- the tariff and internal revenue laws should be ing taken the place of the State banks, and modified, the Secretary still further proposed, furnished a circulation as free from objection as a fourth remedy for the condition of the as any that is likely to be provided, they should country, an issue of bonds bearing interest at a be sustained, and not compelled to retire rate not exceeding five per cent., and payable their notes. How rapidly the Federal notes in Europe, to an amount sufficient to absorb the may be retired must depend upon the effect six per cent. bonds in foreign hands, and supply which contraction may have on the business the European demand for United States securiand industry of the country, and can be better ties for permanent investment. The opinion determined as the work progresses. It could that the country has been benefited by the probably be increased to six millions per month exportation of its securities, which is founded for the fiscal year, ending July 30, 1867, and to upon the supposition that real capital has been ten millions per mouth thereafter. The policy received in exchange, is to a great extent unof contraction should be definitely and un- founded. The importation of goods has been changeably established, and the process should increased by nearly the amount of the bonds go on as rapidly as possible without producing which have been exported. Not one dollar in à financial crisis, or seriously embarrassing five of the amount of the five-twenties now those branches of industry and trade upon held in England and upon the Continent bas which the revenues are dependent. The third been returned to the United States in the form remedy suggested was a revision of the tariff of real capital. Some three hundred and fifty for the purpose of harmonizing it with the in- millions of government bonds, not to mention ternal taxes, etc. The question now before the State and railroad bonds and other securities

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