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JUNE 30, 1911
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Bteady sale In all the markets of the world, and
thus will be Insured steady employment to the
labor which It creates.
I find this language, Mr. Chairman, In the
democratic platform of 1888:
The democratic party of the United States, In
national convention assembled, renews the pled go
of Its fidelity to democratic faith and reaffirms the
platform adopted by Its representatives at the con
vention of 1884, and Indorses the views expressed
by President Cleveland In his last earnest messago
to congress as tho correct Interpretation of that
platform upon the question of tariff roductlon;
and also Indorses tho efforts of our democratic
representatives in congress to securo a reduction
of exccsslvo taxation.
What did Mr. Cleveland say upon the tariff
question In his last earnest message referred to
In that statement? Let us read it:
Tho radical reduction of tho duties imposed upon
raw material used in manufactures, or its free
Importation, Is of course an Important factor In
any effort to reduce tho price of theso necessaries.
It would not only relieve them from tho increased
coat caused by tho tariff on such material, but tho
manufactured product being thus cheapened, that
part of tho tariff now laid upon such product as
a compensation to our manufacturers for tho
present price of raw matorlal could bo accordingly
modified. Such reduction, or freo importation,
would servo besides to largely reduce tho revenue.
It Is not apparent how such a change can have any
injurious effect upon our manufacturers. On tho
contrary, it would appear to give them a better
chanco in foreign markets with tho manufacturers
of other countries, who cheapen their wares by
freo material. Thus our people might have tho
opportunity of extending their sales beyond the
limits of homo consumption, saving them from
tho depression, interruption in business, and loss
caused by a glutted domestic market, and affording
their employees moro certain and steady labor,
with its resulting quiet and contentment.
But you say we lost the election in 1888.
That is true; but when the republicans came
into power they wrote the McKinley law, rais
ing duties and taxing raw materials. These
questions were again fought out on the floors
of both houses, tho democrats lighting for free
raw materials and a reduction of the duties on
manufacturers to a revenue basis, while the re
publicans in both houses contended for a pro
tective duty on both raw materials and manu
factures. The republicans had a sufficient num
ber in both houses to pass the bill, hence it be
came the law. In the next election, the election
of 1892, these questions were fought out be
fore the American people, and the democrats
won. The minority members of the ways and
means committee when the McKinley bill was
written in the house, being such illustrious
democrats as John G. Carlisle, Roger Q. Mills,
Benton McMillln, Clifton R. Breckinridge, and
Roswell P. Flower, made a minority report
against the adoption of that measure, in which
they said:
If it were not for tho excessive cost of produc
tion in this country, caused by the unnecessary
taxation of crude and partially manufactured ma
terials which are essential in tho processes of
our industries wo could export and sell every
year large quantities of the products of our shops
and factories after fully supplying the home de
mand at reasonable prices. Wo believe, therefore,
that tho only manner in which our industries can
bo helped by legislation at the present time is to
exempt from taxation tho materials they are com
pelled to use and to reduce proportionately tho
taxes on finished products, so that all our farmers,
mechanics, and manufacturers may be able to com
peto on equal terms with those of other countries.
This is tho policy we advocate and which wo deslro
to see Inaugurated and completed Just as early
and as rapidly as circumstances will permit. Tho
capitalist who has Invested his money in theso In
dustries, tho laborers he employs, and tho domestic
consumer to whom he sells would all bo benefited
and nobody would bo injured. With untaxed
materials it is evident that they could afford to
pay their laborers better wages than now and still
sell their products to consumers at lower prices
than are now charged. Besides this, under such
a policy our manufactured products would not be
confined, as they are now, almost exclusively to
the domestic market, but would enter all the mar
kets of tho world and compete successfully with
similar products from other manufacturing coun
tries. Tho opening of theso great markets for
the sale of our goods would, in our opinion, give
constant employment not only to tho thousands
of laborers now engaged In our manufacturing in
dustries, but would create a demand for many
thousands in addition, and unless wo are greatly
deceived, tho tlmo would soon como when there
would bo no Importations of finished articles into
this cbuntry except such as our own people, for
climatic reasons, could not produce or do not
desire to produce. Tho only certain and proper
way to stop Importations of such products is to
make them ourselves so cheaply that no foreign
competitor can afford to meet us in our own mar
kets, and this we could undoubtedly do with freo
materials.
Mr. Hardy. Will the gentleman yield for a
suggestion?
Mr. Oldfield. I will.
Mr. Hardy. The gentleman refers to the fact
that in 1884, after the passage through the
house of the Mills bill, placing raw material on
the free list, the republicans won in the next
election. The gentleman does not explain the
jvhys, but does state that in 1892, the McKinley
bill having been passed in the meantime, putting
The Commoner.
a tax on raw materials, and tho tariff being
tho subject of discussion and tho issue in 1892,
tho democrats. won, advocating reduction of tho
tariff and free raw material.
I wish to placo in tho Record right here what
has always been ignored by our republican
friends whenever they discuss the defeat of tho
democrats in 188 8, and to say that that cam
paign, in my recollection, hinged moro on tho
bloody-shirt issue than any campaign since tho
war, almost. A great number of pensions wero
vetoed by President Cleveland, and it was inti
mated to him that a trip by him to St. Louis
would be unsafe. Taking advantage of that
action, the republican party pitched that cam
paign largely on the war issues and appealed
to war prejudices and sectional feeling. Tho
democrats wero defeated in 1888 not by tho Mills
bill, but by tho old war Issues.
Mr. Oldfield. I thank tho gentleman for tho
statement.
Hon. William M. Springer, of Illinois, in re
porting tho democratic tariff bill of 1892, used
this language in discussing tho question of freo
raw materials. Mr. Springer was discussing tho
duty on wool, when, among other things, ho
said:
Tho imposition of this duty, like tho Imposition
of all other duties on raw materials, works doublo
injury. In tho first place, it imposes an unneces
sary burden upon the consumers, who In tho end
pay all tho duties with profits added, and In tho
second place, It destroys tho power of tho do
mestic manufacturer to compote with his foreign
rival in tho production of tho goods into which
tho taxed material Is converted.
Now, Mr. Chairman, let us see what the Hon.
William L. Wilson, the brilliant democrat and
distinguished chairman of the ways and means
committee when tho Wilson bill was written
in 1894, said on the question of freo raw ma-
terials. Mr. Wilson said:
Wo begin our task by an offort to free from
taxation those things on which the Industrial
prosperity ami growth of our country so largely
depend. Of all tho reductions made In this bill
there are nono in their benefit to tho consumer,
none In their benefit to tho laborer, that can bo
compared with the removal of tho taxes from tho
materials of industry. Wo havo felt that wo could
not begin a thorough roform of tho existing sys
tem, built up, as I havo shown, story by story,
until it has pierced the clouds, except by a re
moval of all taxation on the great materials that
He at tho basis of modern industry, and so tho
bill proposes to put on tho freo list wool. Iron ore,
coal, and lumber. I havo already said, Mr. Chair
man, that I beliovo no tariff bill could carry any
benefit to tho American pcoplo comparable to tho
proposed release from taxation of tho materials
of Industry. Better givo a workingman untaxed
materials to work with than give him untaxed
clothing to wear. Better givo him untaxed ma
terials on which to exercise his Industry than un
taxed and cheapened necessaries of life. His
wages depend upon the product of his labor;.
Whatever goes as a tax Into tho material ho uses
is a diminution of the wages of the laboring man.
As you cheapen his materials you widen tho mar
ket for his products. With untaxed iron and stool
in its cruder forms, or even in tho humbler begin
ning of tho ore, with untaxed wool and coal and
lumber you enable him to put his finished products
on tho market at prices that will rapidly and in
definitely increase tho number of his consumers,
and in this way you secure him steady employment,
increasing wages, and that personal lndcpcndenco
he can never enjoy in a closed, high-tariff market.
Mr. Chairman, I well remember In the first months
of my service In this house, during the debate on
tho first Morrison bill, listening to a speech of Mr.
Abram S. Hewitt, himself a great miner of Iron
and coal and a great manufacturer and employer
of labor, In which he proved by a masterly reason
ing and array of facts that In the organization of
modern Industry tho only protection of labor
against corporate and other capital was in Its own
organizations and its own trade-unions, and that
tho only field in which labor organizations can
flourish, tho only arena on which trade-unions can
manifest their power to protect the manhood of
their members and the wages of their labor, Is a
country which throws down tho bars and gives tho
workingman untaxed raw material to work with.
Mr. Bryan, in a speech on this floor, in 1892,
made the following very lucid statement on this
question of free raw materials:
Mr. Chairman, in the first place, I believe wo
can make no permanent progress in tho direction
of tariff reform until we free from taxation tho
raw materials which He at the foundation of our
Industries. It also takes away entirely thoso
specific or compensatory duties which were added
to- the ad valorem rates to enable tho manufac
turers to transfer to tho back of the consumer the
burden which a tariff on raw materials places on
tho manufacturer. The reason why I believe in
Placing raw material on tho free list is because any
tax imposed on raw material must at last be taken
from the consumer of the manufactured article.
You can compose no tax for the benefit of the pro
ducer of the raw material which does not find Its
way through tho various forms of manufactured
product and at last press with accumulated weight
upon tho person who uses tho finished product.
Another reason why raw material should be placed
on tho freo list is because that Is the only method
by which one business can be favored without in
jury to another. We are not in that case Impos
ing a tax for tho benefit of tho manufacturer, but
we are simply saying to the manufacturer, "Wo
will not impose any burden upon you." When wo
givo to tho manufacturer free raw material and
free machinery, we givo to him, I think, all tho
encouragement which people acting under a freo
government Hko ours can legitimately give to a
freo people.
Mr. Chairman, if Mr. Cleveland wero alivo ho
would bo a Brynn man nnd Mr. Bryan would bo
a Clovoland man on this question.
My frlonds, you may dispute whothor freo raw
materials Is a good policy, but you can not dnny
that It has been tho policy of tho democratic
party for moro than GO years.
Mr. Chairman, it has always been tho conten
tion of democrats that if wool wero placed on
tho freo list tho consumers of woolon clothes
would got their clothes cheapor. Now, I am
going to provo by such distinguished republi
cans as Thomas B. Reed, Julius C. Burrows,
Soreno B. Payno, John Dalzoll, Albort J. Hop
kins, and John H. Gear that tho democratic
position is now and always has boon correct.
These distinguished republicans filed a minority
report on tho Wilson bill in 1891, in which they
used the following language, which may bo
found at page 336, sonato document No. 547,
Sixtieth congress, second sosslon:
Tho majority claims it has conforrcd a great
blessing upon tho wool manufacturers by giving
them "freo raw material." Wo find this gift Is
ono which the manufacturers havo not asked and
which they distinctly repudlato as an advantage to
themselves. If wo could assumo for tho moment
somo theoretical benefit to bo derived from freo
wool, It Is not tho manufacturer who can roap that
assumed advantage. If ho can make his goods
any cheaper becauso of freo wool, ho muBt sell
them Just as much cheaper, and from that point
of view ho gains nothing, aB his position remains
unchanged.
Mr. Chairman, they say, "If he can make his
goods any cheaper becauso of free wool, ho must
sell them just as much cheaper, and from that
point of view ho gains nothing."
Mr. Chairman, this sentence shows tho wholo
theory of republican tariff laws. They wrlto
their tariff laws so that somo apodal interest
may gain some advantage over tho rest of tho
people. This principle of republican tariff mak
ing is strongly illustrated In the wool schedulo
of tho Payne-Aldrich tariff law, which thiB bill
seeks to repeal. Tho woolon schedulo in tho
Payne-Aldrich law is substantially tho samo as
In tho Dlngley law of 1897. Statistics show that
in 1905 our mills produced $142,000,000 worth
of woolens, $105,000,000 worth of worsteds,
$95,000,000 worth of knit goods, or in all $400,
000,000. Now, wo Imported $23,000,000. Wo
produced about 18 times as much as wo im
ported, and while tho high rates in tho Dingloy
law and in tho Payne-Aldrich law gave tho
government $20,000,000 in duties tho consumers
were charged the samo rates on domestic goods,
tho government receiving nothing, while tho
manufacturers of woolen goods pockoted $3C0,
000,000 profit, and this at a cost to tho consumer
of $760,000,000 for $400,000,000 worth of
goods. (Applause on tho democratic side.)
Mr. Chairman, tho startling fact reveals itself,
when contemplating tho iniquities of the republi
can protective-tariff system, that the American
consumer, who is the American laborer, Instead
of receiving protection and benefit from tho
republican tariff, as is alleged, is in reality sand
bagged, and the footpads of protection steal upon
him under tho guise of friends. Mr. Chairman,
I want to state right hero that, from tho sta
tistics of the year 1905 with regard to tax on
woolens and the given sum collected that year
by tho government as revenue from such tax,
we find an almost unbelievable discrimination
in favor of the manufacturer and against tho
government and against the American consumer.
Wo find, Mr. Chairman, that for every dollar of
revenue realized by this government from tho
duty on woolens the citizen and consumer is
taxed and compelled to pay tho sum of $18.
For every $18 the consumer pays as a tax on
woolens under the present republican protec
tive system the government realizes only ono
single dollar In revenue. It is not difficult to
calculate who is receiving tho protection under
the republican system.
Mr. Chairman, I have heard some discussion
among democrats as to what are raw materials,
and I believe David B. Hill gave just about as
good a definition of the term as I havo seen
when he says:
Raw materials aro thoso productions which aro
In their lowest and crudest form when they enter
commerce.
I think coal, lumber, Iron ore, cotton, wool,
raw silk, raw rubber, and so forth, are raw
materials. Now, I have heard some dis
tinguished democrats make a statement which
was very confusing to me, and which is to tho
effect that wool is the finished product of the
wool grower, but that it is the raw material of
the carder; and after it had been carded and
made into rolls it was then the finished product
of the carder, but at the samo time it was tho
raw material of the spinner, which became his.
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