The commoner. (Lincoln, Neb.) 1901-1923, January 20, 1911, Page 5, Image 5
-fi V '" JANUART 20, 1911 -.-' 5 ti s. fe The Tariff- Free Speech of Hon. William R. Smith of Texas, in tho House of Representatives, Tuesday, De cember 13, 1910. The house being. In committee of the whoo house on the state of the union for considera tion of the bill (H. R. 29157) making appro priations for the payment of invalid and other pensions of the United States for the fiscal year ending June 30,, 1912, and for other purposes Mr. Smith of Texas said: Mr. Chairman: The republican party met in national convention in June, 1908, and, in obe dience to an almost universal demand of the American people, declared "for a revision of the tariff by a special session of. congress imme diately following the inauguration" of the .presi dent then to be elected. During the campaign which ensued the republican leaders, including their .nominee for tho presidency, asserted over and over again that the revision which their platform declared for meant a revision down ward, and that if the republican party was again Intrusted with power such- revision would bo made. Relying upon these promises the people again placed the republican party in power, giving it the presidency and both houses of congress by unusually large majorities. Immediately after tho new president was in augurated he called the congress together in special session. But this was as far as the party went in carrying out its promises to the people. Congres revised the tariff, but not in accordance with republican promises. The re vision was so slight that experts differ as to whether it was an upward or a downward revi sion. But whether upward or downward, it was not substantial. All agree it did not fulfill the promises of the party or meet the demands or expectations of the people. It completely fulfilled tho propliecy of the democratic party, announced in its platform,, that the people could not safely trust so Impor tant a work as a Revision of the tariff "to a paTty which Is so deeply : Vbllgat'ed t3J the highly, protected interests as is the reptibltcaa party1 And in consequence, at the election recently held the people gave expression to their disap pointment and displeasure by administering to the republican party such an overwhelming de feat as it has not had for many years. The revision of the tariff now having been intrusted to a democratic house of representa tives, it Is not out of place to begin the discus sion of some of the mbre important questions which are sure to arise when that work is taken up in detail. A tariff only for revenue is the time-honored democratic position, and I have the right to assume that when the country com missions a democratic house of representatives to revise the tariff we are expected to reduce it to a revenue basis. But whether we should make such reduction at once or only gradually, or whether it shall be done by a general revision. or by the revision of one schedule at a time it is not my purpose to discuss on this occasion. My remarks now shall be directed especially to the question as to how the duties must be laid under a revenue tariff system, so. as not to handicap or injure any of the industries of the country. I shall undertake to show that this can be done only by placing tho raw materials of man ufacture on the free list. I shall undertake to show that without the Importation of such raw material free of duty a tariff only for revenue as contra-distinguished from a tariff for pro tection is impossible without disaster to many of our industries, from which it will follow that the free raw material doctrine is the true demo cratic doctrine. I Bhall also, undertake to show that the dem ocratic party has never taken a position against this doctrine either before or since the Cleve land era, as has been charged in some quarters, but, on the contrary, that party and its leaders have on many occasions emphatically declared for that doctrine. -First, let us see -what is meant by Taw ma terial as it Is used in the discussion of tariff legislation. David B. Hill defined it to be "a production which is in Its lowest and crudest form when it enters into commerce," And as examples he mentions, coal, iron pre, and lead ore. Of course we all know that' raw material is largely a relative term, for often one man's raw material is another's finished product. But The Commoner. Raw Material in tariff discussion raw material is understood to bo those great crude materials, such as coal, iron ore, lumber, and so forth, which enter into and are tho very bases of manufacture generally. . Mr. Chairman, thoro is an imperative reason why raw material should bo admitted into tho country free of duty If only a revenue duty is to be levied upon manufactured products, and that' is because practically all other manufactur ing countries admit raw material duty free. If wo levy a tariff upon raw material, wo would, to tho extent of tho tariff, increase the cost of the manufacturers' products Into which such raw material is made, and wo would there by handicap the home manufacturer in his con test with the foreign manufacturer in foreign -fnarkets. Indeed, the tendency and effect of a tax upon raw material would be to greatly im pair and in a great measure destroy tho export trade of our home manufacturers. Moreover, it would give the foreign manu facturer an advantage over the home manu facturer in our own home markets unless" a compensatory duty should be levied In favor of the home manufacturer, and if such compen satory duty were levied the cost to the con sumer would be increased to that extent. Other very disastrous consequences would follow the curtailment of our export trade. The demand for our raw material would thereby bo correspondingly curtailed and the demand for labor greatly diminished. Every duty levied . upon the raw. material of manufacture operates as so much protection In favor of foreign man ufacturers against our manufacturers both at home and abroad. On the other hand, the advantages to be de rived from free raw material are many. If our manufacturers were not burdened by a tax upon their raw material, they would need no protec tion, and the duty upon their products could v be reduced to a revenue basis. They could go into foreign markets and meet tho competition of the world. They could expand their export tradet and, thereby enlarge, tho demand for raw material at home, thus giving the . producer of raw material a steady market for his product. They would be enabled to sell to tho con- . sumers, of this country more cheaply, and under the reduced tariff would be compelled to do so, Some of the advantages of free raw material were well expressed by Senator Richard Coko in a speech, in the senate of the United States on April 12, 1888, when he said: "Give us free, untaxed machinery and free raw material, such as coal, ore, wool, jute, and other textile products, these being the . bases of all manufacture, a tariff devoted solely to raising revenue for the support of the govern ment will doubly protect the American working man's wages and send our cheapened goods without handicap into foreign markets to meet and defy the competition of the world. All the reasons for placing raw materials on the free list apply with twenty-fold power to the ma chinery 'which manufactures it. fc "Not one pound of machinery engaged In the manufacture of any article on the dutiable list, nor of raw material entering Into any such ar ticle, should pay a single penny of tariff tax. All Incumbrances, every hindrance, every ounce of weight that can be removed from our pro ducts, should, be taken away And American en ergy, resources, invention, skill, and genius given a. fair opportunity of winning primacy in the commerce of the world. When this grand con summation shall occur, as It must sooner or later, and the sooner the better, the products of the workingman's labor, no longer coffflned to the home market as now, with Its fitful sea sons of high demand and glut, nor to the manip ulations of 'combines' and trusts, will find steady sale in all the markets of the world and thus will be insured steady .employment to the labor which It creates." But, Mr. Chairman, notwithstanding the evil consequences which, as I have pointed out, would result from a tax upon raw material under a tariff levied solely for revenue, and notwith standing the great advantages to be derived from placing raw material on the free list, there are to be found a few democrats, some of them prominent, who insist this raw material shall be taxed so long as a duty is levied upon the manufactured article into which it Is made. This 'tariff dogma Is evidently of very recent origin, for we do not find it laid down in any of the tariff literature of the country. And it seoras also to bo purely arbitrary an no ono han over boon able to give a satisfactory reason for It. . Why should wo arbitrarily say wo will novor agree to tako tho duty off raw material as long as a duty remains upon tho finished product? Tako coal, for instance, which is used in almost every manufacture Could anything bo mpro absurd than to say that as long as any duty remains upon any manufactured article that coal Is used in making wo will insist on main taining a duty on coal? Tho same may bo said of iron oro, lurabor, and other raw materials, which aro used gonorally in manufactures. Tho advocates of this now doctrino might as well tell us they aro not in favor of putting" theso raw materials on tho free list undaf'any circumstances whatovor, as a repeal of tho -duty on all tho manufactured articles into which thoy enter would bo a repeal of practically our.qntlro system of tariff laws, which is Impossible as long as we must raise a largo part of our rev enues by tariff taxation. Thoy toll us that putting raw materials on tho free list is only ono of tho methods of afford ing protection to the manufacturers, and is therefore a republican doctrino. They utterly, fair to draw the distinction between an afllrma tlvo'act, on the part of congress to protect a man ufacturer from foreign competition, and a re fusal by congress to handicap a manufacturer in his efforts to meet foreign competition, which is wholly a different thing. One is to give tho homo manufacturer an advantage by putting a handicap on tho foreign manufacturer; whilo tho othor is to handicap neither, but to give them an equal chance. When two men enter a race It is no protection to ono of them to refuso to put a burden uppniilm. It Is only a slmplo' act of fairness and justice. It is true Alexander Hamilton, In his report on manufactures, recommended tho exemption of tho materials for manufacturers from duty as ono of the means of encouraging and build ing up manufactures in this country, but In do ing this he only pointed out the obvious fa'ct that our manufacturers would stand a better show of success against foreign competition .If no handicap were, placed upon them by legisla tion which would add to tho cost of their raw material and thereby increase the cost of their manufactures. He was not recommending any advantage over the foreign manufacturer in favor of tho home manufacturer. His Idea as only to secure qqual opportunity for tho home manufacturer. Howevor, if free raw material could be properly called protection to American manufacturers, such protection would bo Infinite ly better than protection in favor of foreign manufacturers against our own manufacturers as a tariff upon raw material would bo. , Another reason they say they aro opposed to free raw material is because it gives manufac-. turcrs free trade In what they buy while leav-" lrig thom protection on what they sell. Certainly thoy ought hot to complain If our manufacturers should have the good fortune to have free trade In what thoy buy. Their com plaint, then, is necessarily against tho policy of leaving manufacturers protection on what they sell. If that is what is proposed, their objec tion -would meet my hoarty approval. 'But such is not the case. The democratic proposal Is to put- raw material on the free list, and at the same time reduce all protective duties to a rev enue basis, which means a competitive basis. Then, under such a system, the manufacturer would not only bo able to buy In a competitive market, but he would be required to sell in a competitive market. Those who oppose free raw material seem to overlook the great difference between a competitive market and a protected market, and this seeing, to result in a great deal of confusion in their own minds, I am not discussing the republican protective tariff system. The main purpose of that sys tem is to shield the industries of this country from competition from abroad. This is effected by imposing duties so high upon imports that the foreigner cannot pay the duty and compete with our industries. This enables those en gaged in home Industries to advance prices on their products against our own people and thus make their own business more profitable. It Is a taxation of the many for tho benefit of the few. It is an exercise o"f the taxing power of the government for the benefit of private en terprise. Such a system of taxation is called protection, and the democratic party rightly denounces it as robbery. (Applause on the democratic side.) Viewing protection from a republican stand point, of course every fair minded man, it seems to me; would Insist that If its benefits are to be :5-' j.