"THE PROTECTION OF WAR." The limited tariff of 1861 could not have had the effect of suddenly starting our factories and reviving our industry to the astonishing extent we have witnessed during the past three years. In 1812, the demands and "protection" of war revived our in dustry, and brought wealth and prosperity. In 1861, and during four years of the most costly and tremendous war the world has ever known, we have increased in num bers, wealth, and general prosperity. Our losses in treasure were and are greater under the demands of free trade than under those of war. We can better afford to pay $2,000,000 per day to our soldiers and manufacturers at home to protect our domestic industry, than we can to pay England to do our manufacturing in iron alone. We can better afford to pay the interest on $3,000,000,000 to our own people on our own capital, than to pay the balance of free trade to Europe! The first is accumulative, while the second is exhaustive.
During the war, our production of pig-iron increased to 1,300,000 tons, and, with protection, it can be made to double itself every five years, with an annual decrease in cost. Our rolling-mills produced 283,560 tons of rails in 1864, and possess a capacity of 700,000 tons per annum of rolled iron.
The protection afforded by the war has now partially ceased, and that given by the tariff of 1861 is rendered ineffectual in some cases by the operation of direct taxes, particularly on our iron manufactures. The Republican party pledged themselves to give "protection to the farmer by bringing the consumer to his side;" but we find the reverse to he true at present, and free trade virtually rules to-day over many important branches of our domestic industry.
The duty on iron is nominally $15.68 per ton of 2240 pounds. The direct taxes paid by the manufacturer are $8.40 per gross ton, and the indirect taxes $7.83,—making a total of $16.23 paid by the iron manufacturers on a ton of rails, or 55 cents excess of tax over duty.* The only protection now afforded is in the premium on gold, which we cannot wish to continue. We are, therefore, to-day, though under a Government pledge to protection, on the road to crash, crisis, and ruin, which is sure to follow free trade.
Our exports for the first ten months of the present calendar year-1865—were valued at $86,500,000 in specie, while our imports for the same time amount to $168,500,000 in specie1—or an excess of $82,000,000! 1—which must be paid for in gold, or, worse, in Government bonds, bearing interest, of which over $1,000,000 go to Europe every week.
It is known that more than $500,000,000 of railroad and State bonds are held in Europe, on which the highest rates of interest are paid, and it is feared that over $500,000,000 Government bonds have already found their way to the same hands.
We presume that a direct loss has been suffered in this last transaction of at least $250,500,000. Many of these bonds were sold at a discount of 150, and none less than 40 per cent.; an average, therefore, of 50 per cent. is less than that which has been paid. For this $250,000,000 we have nothing to show; and yet the interest is entailed, because we have absorbed the capital in excess of imports.
We can far better afford to war with all Europe, year after year, than give her free trade, the best of our markets, and pay the balance of "profit and loss" in bonds at 46 per cent. discount.
Ten years of such intercourse would lead us to irreparable ruin,—repudiation,—while ten years of war with all Europe would afford us full protection, wipe out our debts, and save us an annual drain of specie which, under free trade, would not be less than $100,000,000 per annum. Could we not far better pay $2,000,000 per day to our own soldiers, and those who furnish army and navy supplies, to afford us the " protection of war," rather than pay an annual loss so enormous, so ruinous? The taxes paid to our government is not a loss to the country. It passes from hand to hand, and rather in creases than diminishes the wealth of the people, since it is paid principally on capital furnished by the government, on which we realize a profit after paying the interest. But we can far better afford to pay and keep in the field 500,000 soldiers than allow the domestic industry of 30,000,000 to languish, and pay Europe to work for us. We had better tax the industry of the country $2,000,000 per day, than lose a larger amount by, idleness, and the want of profitable employment, by crushing out the spirit of industry by free trade I