A PRACTICAL EXEMPLIFICATION OF "PROTECTION" FALLACIES.

New Zealand Herald, Volume V, Issue 1363, 30 March 1868, Page 7

A PRACTICAL EXEMPLIFICATION OF "PROTECTION" FALLACIES.

(From the San Francisco Times, January 9.) Last winter there was a superhuman effort oa the part of interested parties to get through anew tariff bfl which should enormously raise the already exorbitant duties. A strong combination was made to pass it; but, in the effort to

■" protect " everybody and everything;, the bill became so cumbrous I hat it finally fell between the two Houses, after having been passed in some shape by both of them. But in the last days of the session, finding that the Omnibus Bill would not pass, the clauses relating to wools and woollens, for which there was the most powerful pressure, were placed,in a separate bill ■and became law, to the great delight of such " friends of American industry" as Horace Graeley, Henry Carey, et al. A probitory duty was laid upon foreign wools ; and, to compensate the manufacturers, the duty upon woollen goods was greatly increased, being doubled on the coarser kinds. This was not done without protest. In his report for 18GG, Mr. Welles, the special Commissioner of the Nevenue Department, warned Congress of the injury it would do by laying such -a tariff as the " protectionists " called for upon foreign wools. He showed how it would prohibit manufacturing, reduce the price of domestic wool, and how. moreover, it would cause the United States to lose a profitable export trade to tho Cape of Good I 1 ope, South America, &c. These predictions were laughed at by the " protectionists," and the wool bill was put through. The law has now been in operation nearly a year, but so far from having accomplished what was intended. Commissioner '••"olr's's predictions have been completely verified. The condition of the woollen mnmiinrturing* interest has gone from bad to worse, and mill after mill lias been closed; the price of domestic , wool has steadily dropped, with no prospect, of rising unlil it is relieved from " protection." The following, ■which, we take from the annual wool circular of M'Jjennan, Whelan, and tfrisar, we would have read by every farmer on the coast: — " The reason of the low prices which havo ruled in the United States is perfectly plain, and can be easily explained. 'I he tariff on foreign wools—passed by the Congress—is merely prohibitory. It was established as a protection to ■wool growers, but has been anj'thing but a protection, and we believe that so long as such a tariff exists the prices will romain comparatively low. " The wools formely imported into the Fmted States from Australia, the Cape, South America &C, Ac, were shut off by the tariff, although they were essential to our home manufactures for mixing with other wool, so as to give variety to their productions. " The wools, so expelled had to find a market in Europe, and their importation there reduced prices so much as to allow the European factories to produce goods at such a rate that they could be imported into the < nited States, even with the ruling high duty upon foreign imports, at a lotver figure than they could be produced there. "We mean to say that the price of wool would have been higher if no dut'es had been placed upon it. A protective tariff has always been a double-edged blade, that proves injurious to those who handle it without care." What is true of wool in this case is true of everything else. It is simply impossible to protect industry by taxing it.