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to cover it, and no mills to work it up; their ports so far closed, that all the means of subsistence and comfort, except the coursest nccessaries, have become scarce and dear; while their people, as might be expected under the circumstances, have neither means nor skill to extemporize the power necessary to provide clothing, arms, and ammunition for the brave but deluded men whom they have brought into the field.' Convinced at last by a terrible experience, they are now calling on the Southern community to plant corn instead of cotton, and to create among themselves that manufacturing power which they have so long despised and derided. Can they fail to perceive how different might have been their condition, and their chances of success in such a struggle, had they only thought of all this before? And can we of the Union, soon to be restored in all its integrity, and in more than its former strength and glory, – who have profited so much by this vast difference in. the industrial habits and productive powers of the contending sections, -ever forget the instructive lesson?

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In view of such facts and considerations as have now been presented, I cannot think it likely that we shall overestimate the benefits of a wisely protective policy. Wholly to abandon such a policy would be an act of suicidal folly. To relax it even would be most unwisc and unsafe. Nay, more: we are clearly bound by every consideration of sound economy and true statesmanship to strengthen and perfect the system.

As many, however, notwithstanding all experience, will continue still to be swayed by those interested advisers and those theorizing politicians who so positively assert that our manufactures would be more thriving without protection than they are or can be with it, let us consider for a moment under what conditions of relative advantage we are called to meet our foreign rivals in the great strife of industry.

In order that we should be able to compete with a foreign country on equal terms in our own market, certain conditions must be the same, substantially, in both communities. Without such equality, that nation which has the advantage will certainly distance its rival. In other words, that they may enter fairly and hopefully into competition, the two countries should be nearly alike in the possession of skill and capital, in the price of labor, in the enjoyment of an established business, and in the extent of their business operations and connections. If there be a marked inequality in all or in any of these respects, the balance can be restored only by legislative protection on the part of the weaker power.

1 The disparity of mechanical force in the two sections is strikingly shown by the census of 1860; according to which, the

mechanic arts, in the loyal States, was $1,760,869,000, while that of the disloyal States was only $145,181,000.- See Table O,

So far as the price of labor is concerned, the difference between this country and England, though great enough to give the English manufacturer a considerable advantage, is gradually diminishing. Skilled labor, indeed, commands nearly the same wages here as there; while ruder workmen get much less than men of the same class earn among us. The hours of labor, and the circumstances under which it is performed, not being just the same in the two countries, there is some difficulty in estimating exactly, from wages-tables,' the comparative cost of labor in any given article of manufacture. Speaking generally, however, we may set down the cost of English labor, in the various manufacturing results, at ten to thirty per cent less than in the United States.

The advantages of a business long and firmly established, and of extensive and well-known commercial connections, are not always fully appreciated by our ardent and enterprising countrymen. In this respect, they might often and profitably take a leaf from the recorded experience of older communities. Essential to entire and enduring success as this important condition is, it is not of a nature to be estimated in figures. That English manufacturers possess, in this particular, a very great advantage over their American rivals, no one, qualified to judge, can entertain a doubt.

It is natural to remark in this connection, that, so far as manufactures are concerned, England has decidedly the lead among the nations. How this was brought about, we need not here inquire. The fact is evident and undeniable. Now, we all know that to have the lead in any transaction or pursuit is virtually to control it. Will any one contend that this fact gives England no advantage over us? Are we not bound to counteract, if possible, this preponderating influence?

For general and thorough success in any pursuit, it is essential that those who engage in it should possess a well-grounded confidence in the stability of government, of legislation, of business, and of social order; and in no department,

1 For the rates of wages paid in Great Britain and the United States, see Appendix, Nos. 113, 114, 115, 116, and 117; and for the rates of wages paid in Belgium, seo No. 94.

Illustrations of this are close at hand. How else does Massachusetts engross the shoe-manufacture; or New England produce, to so large an extent, the textile fabrics of the country? "The plans and combinations of capitalists have not been affected by misgivings as to what might take place in the future. Moneyed fortunes have not been amassed in preference to others, because they might be more easily sent abroad in periods of confusion and disorder; but all individuals have unhesitatingly engaged, whenever an opportunity offered, in undertakings of which a remote posterity was alone to reap the benefit. No one can look at the immense sums expended upon the permanent improvement of the land, on docks, warehouses, canals, &c., or

reflect, for a moment, on the settlements of property in the funds, and the extent of our system of life-insurance, without being deeply impressed with the vast importance of that confidence which the public have placed in the security of property and the good faith of the government. Had this confidence been imperfect, industry and invention would have been paralyzed, and much of that capital which feeds and clothes the industrious classes would never have existed. The preservation of this security entire, both in fact and in opinion, is essential to the public welfare. If it be anywise impaired, the colossal fabric of our prosperity will crumble into dust; and the commerce of London, Liverpool, and Glasgow, like that of Tyre, Carthage, and Palmyra, will, at no very remote period, be famous only in history." - Mc Culloch: Commercial Dictionary, 1859, p. 722.

probably, of human affairs, is this confidence so necessary and so useful as in the prosecution and development of manufacturing industry. The reason is manifest. Without such confidence, no prudent business-men are willing to make those large and permanent investments which are the sole condition of ultimate and complete

success.

That we may the better understand our relations to Great Britain in regard to this question, and the wide disparity which exists between her advantages and our own, let us look at the cotton manufacture. Here we find the English producer in full possession of the home-trade, - a monopoly which he has no fear of losing,-and disposing of his exports, to the amount of two hundred and fifty million dollars a year, in nearly sixty foreign markets. As a set-off to this splendid exhibit, what has our cotton manufacturer to show? He enjoys a part, and only a part, of the home-market; and holds even this, to a considerable extent, under the uncertain tenure of legislation which has too often been fickle, and sometimes unfriendly. He exports also certain coarse fabrics, to an amount that ranges from six to ten million dollars a year. In the other great branches of manufacture, a similar inequality exists. At what disadvantage, comparatively, our manufacturers must work, under circumstances so different from those of their English competitors, and with so different a basis of confidence, must be seen at a glance. To the simple statement of such a fact I need not add a word.

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But it is in the abundance of her capital, and the comparative cheapness of its that England has over us her greatest advantage as a manufacturing power. To establish, prosecute, and properly develop, any great productive industry, moneyed means are not only useful: they are absolutely necessary. Although capital employed in this direction could do nothing without skill, it is certain that skill would be all but powerless without capital. The universal and increasing use of machinery has wrought a great change in this respect. This view of the matter will not appear strange to any one who considers the outlay which is required to found, start, and run a large and efficient manufacturing establishment; and who knows, that to the preliminary cost of site, motive force, and buildings, must be added the cost (not small) of machinery, of labor, and of raw material.

As between individuals or rival companies, so also between those larger communities called nations, engaged in manufacturing conmpetition, other things being

equal, — that party will be most successful which sways the largest capital. Those "other things" are indeed numerous, and some of them are most important; for they include not only technical and business skill, but sound judgment, prudence and frugality. With such qualifications, the assertion may be accepted as an axiom.

This vast advantage of superior capital, England has long enjoyed. That she has always and fully understood its importance and value, can easily be shown. Seventyfive years ago, in debate on a proposed treaty of commerce with France, EDMUND BURKE thus gave his opinion respecting it:

“Our capital gives us a superiority which enables us to set all the efforts of France to rival our manufactures at defiance. The powers of capital were irresistible in trade; it domineered, it ruled, it even tyrannized, in the market; it enticed the strong, and controlled the weak."1

"The immense accumulation of capital that has taken place since the close of the American War has been at once a cause and a consequence of our increased trade and manufactures. Those who reflect on the advantages which an increase of capital confers on its possessors can have no difficulty in perceiving how it operates to extend trade. It enables them to buy cheaper, because they buy larger quantities of goods, and pay ready-money; and, on the other hand, it gives them a decided superiority in foreign markets where capital is scarce, and credit an object of primary importance with the native dealers. To the manufacturer, an increase of capital is of equal importance, by giving him the means of constructing his works in the best manner, and of carrying on the business on such a scale as to admit of the most proper distribution of whatever has to be done among different individuals. These effects have been strikingly evinced in the commercial history of Great Britain during the last half-century; and thus it is, that capital, originally accumulated by means of trade, gives it, in its turn, nourishment, vigor, and enlarged growth.”*

"The large capitals of this country are the great instruments of warfare against the competing capital of foreign countries, and are the most essential instruments now remaining by which the supremacy of our manufactures can be maintained.""

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"The power of capital, skill, industry, long-established character and connections, sustaining English bears up against all that has been done."

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Of like tenor is the following utterance of Sir ROBERT PEEL, in the corn-law debate

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"That we may retain our manufacturing pre-eminence, we must neglect no opportunity of securing to ourselves those advantages by which that pre-eminence can be alone secured. The accumulation of wealth (that is, the increase of capital) is one of the chief means by which we can retain the eminence we. have so long enjoyed."

1 Parliamentary History, vol. 26, p. 487.

McCulloch: Commercial Dictionary, 1859, p. 720.
See Report, already quoted, p. 41 of the text.

Remarks on Recent Commercial Legislation, p. 61.

• Hansard, 3d series, vol. 83, p. 280.

I shall make no attempt to state in numbers the amount of that vast capital, the possession of which is so justly claimed in the passages above cited. Such an attempt could, at best, be only an approximation. The immense superiority of England to all other countries, in this respect, is denied by no one.

We can, however, state with sufficient exactness what it costs to hire and employ such portions of this enormous wealth as are devoted to the various enterprises of trade and business. The great difference in the value of money between the United States on the one hand, and England and France on the other, is shown in striking contrast by the figures of Table P,' where we find that the average rate of interest paid here, during

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the fifteen years ending with 1860, was more than double the average on the other side. Remarkable as this difference may seem, it is such, in kind, as must always distinguish countries comparatively new, and partially settled, from those of longer standing. Neither the laws nor the condition of the United States can be considered favorable to great accumulations of capital. Existing, as it does here, in amounts comparatively small and widely distributed, the price of its use must, in general, range high, so long as we have land in so large proportion to the number and wants of the

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