LETTER XX
Circumstances that retard Manufacturing Industry, and Causes of its prosperity
Jeffersonville, (Indiana,) Aug. 15, 1820.
In my letter of the 26th of June last, I mentioned that mechanics were leaving the towns of the western country, becoming cultivators in the back woods. In many cases, their former habits are such as are not well calculated to reconcile them with their new situations. It appears evident that such people, placed in the forests, cannot for some time raise a quantity of produce sufficient to procure in exchange such foreign luxuries as they formerly consumed,and such articles of imported dress as they have been accustomed to wear. The former may be easily dispensed with, but for the latter a substitute must be provided. Family manufacture is the obvious resource; but it must proceed slowly in cases where the females are not acquainted with this branch of industry, and {239} in the uncleared woods, which are not suitable pastures for sheep. It is to be regretted that manufacturing establishments are not erected, as these would not only furnish employment more congenial to the habits of artizans, and preserve to them their wonted accommodations, but would be of vast national importance under the present circumstances of America.
I trust that a brief exposition of a few of the principal causes which retard manufacturing industry, and of the means of promoting it, in this country, will not be unacceptable to you; especially as the policy of America, on that subject, affects at once the interests of both countries.
The primary obstacle that has hitherto prevented Americans from fabricating their own necessaries, from the products of their own country, is universally acknowledged to be an extensive intercourse with Great Britain, in exporting produce, and importing manufactured goods in return;—a correspondence that subjects American artisans to a competition with a country in which wages are low, labour subdivided, and in which the most stupendous mechanical apparatus is employed.
The indecision which has heretofore characterized the conduct of the United States, with regard to manufactures, seems to have originated in the diversity of interests represented in the government. The people of the southern States are, for several reasons, averse to makingconcessions for procuring home-made goods. They are comparatively little devoted to mechanical pursuits, and still less acquainted with the diversified operations of workshops. Their negroes are seldom trained to any thing but agricultural and menial services, and the {240} condition of these labourers is otherwise unfavourable to the acquisition of skill in new employments. This part of the country, besides, exports large quantities of cotton, tobacco, and rice, articles that do not excite the jealousy of the landed interest in Britain; but, on the contrary, almost enjoy a monopoly of the British market. It is plain that the people who possess advantages of this kind, have it more in their power to continue traffic with England than their northern neighbours, whose produce is excluded by the corn laws of that country, which have been wisely enacted.
Traders who have capital vested in ships, and in the importation of manufactured goods, form a class that is more interested in opposing an independent system than any other. Though their influence in Congress appears to be declining, some time must elapse before their funds can be directed to other pursuits.
The import duties on foreign manufactures, high as in most cases they appear to be, have not the effect of protecting American artizans from competition with those of other countries, who work cheaper. This disadvantage has been produced by the profuse issues of a paper currency. Money of this sort not taking the market abroad, it remains in the country, where it operates against industry, by augmenting the nominal price of labour. Hence people are complaining of want of employment, while they depend on the labour of foreigners for almost every artificial modification of the materials raised on their own soil, orthat lie unheeded under their feet. Import duties are not to be considered merely as enactments for promoting American manufactures, for they constitute the principal source of national revenue. It might be difficult to form a conception of a revenue {241} that could be collected at less expense, or of taxation raised in a more voluntary manner on the part of the people. But as moderating these duties must unquestionably, on every occasion, be injurious to home industry, and as augmenting them to the extent of the total prohibition of foreign goods would introduce smuggling, the two objects of the system are in some degree incompatible in the present state of money affairs.
The capital vested in uncultivated lands, is a mere dormant stock which cannot be applied to such active employments as the erection of workshops, machinery, and other outlays necessary for the establishment of manufactories, unless it is replaced by other funds. Neither is it so easy to procure money as formerly by mortgaging cultivated lands, now when the prices of produce are so low.
The expedients resorted to, in keeping base money in circulation, are, with respect to manufacturing interests, as impolitic as they are, in fact, unjust. Bankers, who are virtually insolvent, are to be ranked amongst the opposers of manufacturers, as it must be impossible for such men to contemplate the reduction of the quantity of money so essential to industry, without dreading the retribution that awaits them.
The present condition of the United States is well suited to convince the people of the expediency of making exertions for supplying their own wants. Europe is no longer to be relied on as a market for their produce, and Great Britain in particular has in effect excluded the grain andthe timber of the United States from her markets, and prohibits Americans from trading with her West India colonies. Since these restrictions have taken place, great quantities of British manufactures have been imported into America, and the course {242} of exchange has shown, that a large money balance has arisen in favour of Britain. Some persons interested in the traffic, infer the prosperity of the United States from their being able to pay a balance of trade. Though general doctrines of this kind are sanctioned by several great economists, on the broad principle that an exportation of money indicates a corresponding importation of property, or in other words, an accumulation of wealth; before adopting an assumption of this kind in any particular case, it may be safe to inquire whether the import consist of articles, which are permanently beneficial, or of luxuries either of the more perishable kinds, or of those more conducive to ornament than utility. With regard to the late imports of the United States, it is thought sufficient to notice that they have not furnished the ability to continue them in their usual amount.
Farther, nothing can be more plain than the necessity of abridging the quantity of paper money in circulation; and when this is done to a sufficient extent, foreigners will find it impossible to procure dollars here on terms so easy as formerly. Were money rendered so scarce, that it would command three or four times the quantity of the necessaries of life that it does now, foreign labour would be excluded, and the American labourer, with a third or a fourth part of his present nominal wages, would find the only changes in his condition to be a greater demand for his work, and an immediate enlargement of his resources. The farmer would eventually find the means of increasinghis produce, and the advantage of a home market; and capitalists now engaged in foreign commerce, would find employment for their funds in manufactures. Fortunately the impolitic course latterly {243} pursued is leading to its own correction. Specie is seldom to be seen in the ordinary transactions of business, except in small worn pieces of inferior denominations, and cut money, from which a portion of the metal has been fraudulently abstracted. The deficiency in weight prevents this part of the currency from being exported in direct payments, and nothing but the recent depreciation of paper seems to prevent these remnants of silver from being disposed of as bullion.
In former times, when Europe furnished a market for almost every kind of produce, the strongest inducements to agricultural industry prevailed. The fertility and the vast extent of the United States enabled cultivators to increase in numbers, in a manner that would have produced a disagreeable competition, in a more thickly peopled country; but the recent state of commercial affairs shows that America is not wide enough to prevent the inconveniences of competition in a narrow market. The necessity of a new distribution of pursuits becomes every day more apparent, as without it the people cannot enjoy the articles of comfort and luxury hitherto imported. Some of the most popular newspapers now advocate the cause of manufactures, and several public societies take a deep interest in promoting the internal prosperity of the country. The society at Philadelphia for promoting American manufactures,[130]have in some of their papersreasoned in such a manner as to prove that they possess a comprehensive knowledge of the subject, both of its effects on national wealth, and of manufacturing business. The resolutions of the society lately instituted at Cincinnati for the promotion of agriculture, manufactures, and domestic economy, are subjoined, {244} as a mark of the patriotic spirit that now prevails.[131]The committee of this society consists of people of the greatest wealth and influence in the city and neighbourhood.
Of the essays in favour of manufactures which have been published, it may be observed generally, that theyrecommend the adoption of higher import duties. That these have not been resorted to, need excite no surprise, as the secretary of the treasury has shown that an increase of duties must be followed by a decrease of national revenue, {245} and as the ultimate substitute, internal taxation, would probably be unpopular, although imposed with the most sparing hand. The spontaneous decrease in the amount of money capital now going on, does not seem to be duly appreciated;—an occurrence that is evidently well calculated to give an impulse to American industry.
When the United States shall abandon the spurious money now in circulation, and proceed on a smaller but more substantial capital, a new era of national prosperity will commence. The government will be freed from the danger, or rather the certainty, of losing the revenue by a smuggled trade, and will feel less necessity for resorting to restrictive regulations. A less sum of money will be sufficient to defray the public expenses. The consequent cheapness of labour will give the agriculturist new advantages in foreign markets, and develop in a new degree the natural resources of the country. The home market, occasioned by a manufacturing population, will be secure, as being beyond the reach of foreign governments, whose caprice is hostile to the security of American trade. Whenever the country shall be able to manufacture the whole, or the greater part of its necessaries, the exports of produce must be attended with an importation of specie. The ingress of foreign capitalists may also be calculated on as one of the effects to be produced by the change of system.
The introduction of manufactures must promote internal improvements, as the making of roads and the construction of works, for facilitating inland navigation. Thecountry will be rendered capable of supporting a greater population than it can under the present system, thereby removing much of the inconvenience that attends their present settlements; {246} better opportunities for mental improvement, and the means of more prompt national defence, will be acquired; foreign commerce and foreign relations will be abridged, so that the hazard of hostilities with other countries may be greatly lessened. A small shipping trade evidently requires less naval protection than an extensive foreign commerce, and the retrenchment may perhaps admit of some relaxation in the present construction of ships of war. The reverses so frequently injurious to the manufacturers of Britain are less to be dreaded in the United States. While their manufactures do not exceed their own wants, it will always be practicable to prevent the home market from being overstocked, and while the vacant back woods are held in reserve, a manufacturing population need not be reduced to pauperism by the want of a foreign market for their fabrics.
The erection of manufacturing establishments was recommended some time ago by intelligent citizens, who foresaw that the money capital of the country could not long supply the great efflux of specie. Now, a change of policy becomes a matter of necessity. It is chiefly to be regretted several State legislatures are too active in forcing the circulation of degraded money;—a procedure which, in the meantime, retards the natural subsidence of the convulsion, and keeps property out of the hands of its real owners. However far they may succeed in procuring indemnity for past peculations, their efforts must be impotent in opposition to the future interests of mankind. The paper currency that they strive to support falls in spite of their utmost exertions. I now find that my expense of living orof travelling is nominally the same that it was in the autumn of 1818. At that time I paid in specie, or in money, which {247} was considered as nearly equivalent to it, but of late I have on various occasions found that paper is accepted which is 50 per cent. worse than silver. A person who collected a salary to the amount of about eight hundred dollars, told me that he had received only five dollars of that sum in specie. You can easily perceive that, under this state of things, very few will give specie to the tavern-keeper, grocer, or others, while he can previously procure for it one and a half times, or twice its nominal amount, in what is called current paper. Most of the small towns have a person who follows the business of money changing; and merchants and other persons transact in that way, so that specie is almost entirely withdrawn from retail business, and applied to the purchase of public lands, or other objects, for which depreciated paper would not be accepted of in payment. Under this condition, an unsettled or precarious sort of internal trade is carried on, but it is impossible to import foreign goods as formerly.
The want of employment is another strong inducement to adopt an independent system of economy, but a cumbrous load of paper money presses industry to the earth. It is found by experience that the farmer cannot pay 125 cents per day to the labourer, and sell his corn for 25 cents per bushel, nor can the labourer work for a small hire while he pays two and a half, or three dollars a-week for his board, and an extravagant price for his clothing. Similar obstacles occur in almost every branch of industry that furnishes anything for exportation, or comes into competition with the labour of foreign artizans, so that the operations of this country now consist chiefly of worksof first necessity. A gentleman who has opportunities of being well acquainted with the {248} business of Philadelphia, has computed that in that county alone, there are at least 15,000 persons who are either entirely idle or are engaged in unproductive labour. He stated that he has had more than twenty applications for employment, when he could give work only to one, and that several other manufacturers say, that they cannot employ a tenth part of the applicants they meet with. The same gentleman estimates that there are about 150,000 unemployed persons along the Atlantic coast, and that there are 350,000 persons of the same description in other parts of the country.[132]It is not pretended that these enumerations are derived from accurate data, or that they are even very close approximations to the real numbers; but, taken in connection with other well known facts, they may be received as satisfactory evidence that the evil exists to a very considerable extent.[133]
{249} Want of employment is here viewed as a want of organization. With you it is represented to be an indication of an overpeopled country. The government of the United States does not attempt to get rid of its people, but, on the contrary, it welcomes the stranger who arrives on their shores. Your government pay for transporting their subjects, or encourage their removal by giving them lands gratis. Canada is wide enough to receive them, but its connection with England does not admit of a free trade. Multitudes of emigrants find their comforts as narrow as before, and remove into the United States. If facts of this sort indicate any thing, it is that no extent of country can compensate for mismanagement, or, in other words, a nation is more easily overstocked from impolicy than from want of soil.
The habits and institutions of the American people are peculiarly favourable to the adoption of manufacturing pursuits. They have no corporations with exclusive privileges, and no laws which enact any specific period of apprenticeship. Their well known spirit of enterprise, and the circumstance {250} of almost every man’s being acquainted with handling the axe, the hammer, the saw, and the joiner’s plane, must give a facility to the acquisition of mechanical labour. Besides, it is understood that a few weeks, or at farthest a few months, are enough to communicate the knowledge of most of those employments,and that the work can soon be reduced to practice by subsequent application. The progress already made in several branches of manufacture tend to inspire a strong hope as to future attainments. The fabrication of coarse cotton cloths, calleddomestics, which now undersell British goods of similar quality; the making of iron articles, of leather-hats, paper, types, engravings, the construction of steam-boats, and the building of ships, are mentioned as flattering examples.
As the disposition to promote American manufactures is progressive, and as popular opinion dictates the measures of the government, it may be safe to infer that commerce with England is now in a deep decline, and that the erection of workshops (though it should be on a moderate scale) may be hailed as the liberation of the United States from foreign monopoly.
FOOTNOTES:[130]The Philadelphia Society for Promoting Domestic Manufactures, organized in 1803, with Stephen Girard as president, was incorporated in 1805. A central warehouse was established, where articles of American manufacture could be concentrated and sold, thus doing away with the expense of middlemen. The society was active in advocating a protective tariff.The Cincinnati Society for the Promotion of Agriculture, Manufactures, and Domestic Economy was organized in 1819. Quarterly meetings were held, and prizes offered for the best essays on subjects relating to agriculture and domestic manufactures.—Ed.[131]“1st.We will not purchase, or suffer to be used in our families, any imported liquors, fruits, nuts, or preserves of any kind, unless they shall be required in cases of sickness.“2d.Being convinced, that the practice which generally prevails of wearing suits of black as testimonials of respect for the memory of deceased friends, is altogether useless, if not improper, while it is attended with a heavy expense; we will not sanction it hereafter in our families, or encourage it in others.“3d.We will not purchase, for ourselves or our families, such articles of dress as are expensive, and are generally considered as ornamental rather than useful.“4th.We will abstain from the use of imported goods of every description, as far as may be practicable, and we will give a preference to articles that are of the growth and manufacture of our own country, when the latter can be procured.“5th.We will not purchase any articles, either of food or dress, at prices that are considered extravagant, or that the citizens generally cannot afford to pay; but will rather abstain from the use of such articles until they can be obtained at reasonable prices.“6th.We will observe a rigid economy in every branch of our expenditures, and will, in all our purchases, be influenced by necessity rather than convenience, and by utility rather than ornament.“7th.We believe that the prosperity of the country depends in a great degree on a general and faithful observance of the foregoing declaration; we therefore promise that we will adhere to it ourselves, and that we will recommend it to others.”—Farnsworth’s Cincinnati Directory.—Flint.[132]Letter to the President of the United States, by John Melish, Esq. Phil. 1818.—Flint.[133]From the paucity of the circumstances attended to in statistical inquiries, the most superficial observer might infer that national pride is sufficiently gratified by the number of human beings, without regard to that of useful or efficient citizens, and that governments are satisfied with knowing little more of their people than that they die, and that they were born. It were to be wished that enumerations were made annually, instead of at the usual long intervals of time; and in addition to the particulars ordinarily ascertained, such were embraced as, the number of those who can show that they procure their subsistence by lawful means; those who have fixed residences; those who have received a moral education; the nature of employments; the duration and immediate causes of their avocations; bankruptcies; convictions for specified crimes; the known or proximate causes of deaths; cases of lunacy;felo de se; epidemy and meteorological registers made in every department of the country. The collection of information of this kind might be conducted in a manner that would operate as a beneficial supervision of society. It would furnish the police department with a new insight into the sources of delinquency. Taken in connection with coexistent laws which effect trade and revenue, and criminal laws, and the state of markets, political economy would be furnished with new instruments for investigation. The approach of misery might frequently be anticipated and arrested without being exhibited on the poor’s list, in the workhouse, or in the shape of inability to pay taxes. Crimes might be prevented, and better criteria obtained for discriminating between offences committedagainstlaw, and those perpetratedbylaw. A new light would be thrown on several branches of physical science, and particularly on agriculture, climate, and the healing art. It is but too easy to discover that the desideratum is not in unison with the affairs of the age, but it is probable that another Alfred, or a Lycurgus must arise before it can be remedied.—Flint.
[130]The Philadelphia Society for Promoting Domestic Manufactures, organized in 1803, with Stephen Girard as president, was incorporated in 1805. A central warehouse was established, where articles of American manufacture could be concentrated and sold, thus doing away with the expense of middlemen. The society was active in advocating a protective tariff.The Cincinnati Society for the Promotion of Agriculture, Manufactures, and Domestic Economy was organized in 1819. Quarterly meetings were held, and prizes offered for the best essays on subjects relating to agriculture and domestic manufactures.—Ed.
[130]The Philadelphia Society for Promoting Domestic Manufactures, organized in 1803, with Stephen Girard as president, was incorporated in 1805. A central warehouse was established, where articles of American manufacture could be concentrated and sold, thus doing away with the expense of middlemen. The society was active in advocating a protective tariff.
The Cincinnati Society for the Promotion of Agriculture, Manufactures, and Domestic Economy was organized in 1819. Quarterly meetings were held, and prizes offered for the best essays on subjects relating to agriculture and domestic manufactures.—Ed.
[131]“1st.We will not purchase, or suffer to be used in our families, any imported liquors, fruits, nuts, or preserves of any kind, unless they shall be required in cases of sickness.“2d.Being convinced, that the practice which generally prevails of wearing suits of black as testimonials of respect for the memory of deceased friends, is altogether useless, if not improper, while it is attended with a heavy expense; we will not sanction it hereafter in our families, or encourage it in others.“3d.We will not purchase, for ourselves or our families, such articles of dress as are expensive, and are generally considered as ornamental rather than useful.“4th.We will abstain from the use of imported goods of every description, as far as may be practicable, and we will give a preference to articles that are of the growth and manufacture of our own country, when the latter can be procured.“5th.We will not purchase any articles, either of food or dress, at prices that are considered extravagant, or that the citizens generally cannot afford to pay; but will rather abstain from the use of such articles until they can be obtained at reasonable prices.“6th.We will observe a rigid economy in every branch of our expenditures, and will, in all our purchases, be influenced by necessity rather than convenience, and by utility rather than ornament.“7th.We believe that the prosperity of the country depends in a great degree on a general and faithful observance of the foregoing declaration; we therefore promise that we will adhere to it ourselves, and that we will recommend it to others.”—Farnsworth’s Cincinnati Directory.—Flint.
[131]“1st.We will not purchase, or suffer to be used in our families, any imported liquors, fruits, nuts, or preserves of any kind, unless they shall be required in cases of sickness.
“2d.Being convinced, that the practice which generally prevails of wearing suits of black as testimonials of respect for the memory of deceased friends, is altogether useless, if not improper, while it is attended with a heavy expense; we will not sanction it hereafter in our families, or encourage it in others.
“3d.We will not purchase, for ourselves or our families, such articles of dress as are expensive, and are generally considered as ornamental rather than useful.
“4th.We will abstain from the use of imported goods of every description, as far as may be practicable, and we will give a preference to articles that are of the growth and manufacture of our own country, when the latter can be procured.
“5th.We will not purchase any articles, either of food or dress, at prices that are considered extravagant, or that the citizens generally cannot afford to pay; but will rather abstain from the use of such articles until they can be obtained at reasonable prices.
“6th.We will observe a rigid economy in every branch of our expenditures, and will, in all our purchases, be influenced by necessity rather than convenience, and by utility rather than ornament.
“7th.We believe that the prosperity of the country depends in a great degree on a general and faithful observance of the foregoing declaration; we therefore promise that we will adhere to it ourselves, and that we will recommend it to others.”—Farnsworth’s Cincinnati Directory.—Flint.
[132]Letter to the President of the United States, by John Melish, Esq. Phil. 1818.—Flint.
[132]Letter to the President of the United States, by John Melish, Esq. Phil. 1818.—Flint.
[133]From the paucity of the circumstances attended to in statistical inquiries, the most superficial observer might infer that national pride is sufficiently gratified by the number of human beings, without regard to that of useful or efficient citizens, and that governments are satisfied with knowing little more of their people than that they die, and that they were born. It were to be wished that enumerations were made annually, instead of at the usual long intervals of time; and in addition to the particulars ordinarily ascertained, such were embraced as, the number of those who can show that they procure their subsistence by lawful means; those who have fixed residences; those who have received a moral education; the nature of employments; the duration and immediate causes of their avocations; bankruptcies; convictions for specified crimes; the known or proximate causes of deaths; cases of lunacy;felo de se; epidemy and meteorological registers made in every department of the country. The collection of information of this kind might be conducted in a manner that would operate as a beneficial supervision of society. It would furnish the police department with a new insight into the sources of delinquency. Taken in connection with coexistent laws which effect trade and revenue, and criminal laws, and the state of markets, political economy would be furnished with new instruments for investigation. The approach of misery might frequently be anticipated and arrested without being exhibited on the poor’s list, in the workhouse, or in the shape of inability to pay taxes. Crimes might be prevented, and better criteria obtained for discriminating between offences committedagainstlaw, and those perpetratedbylaw. A new light would be thrown on several branches of physical science, and particularly on agriculture, climate, and the healing art. It is but too easy to discover that the desideratum is not in unison with the affairs of the age, but it is probable that another Alfred, or a Lycurgus must arise before it can be remedied.—Flint.
[133]From the paucity of the circumstances attended to in statistical inquiries, the most superficial observer might infer that national pride is sufficiently gratified by the number of human beings, without regard to that of useful or efficient citizens, and that governments are satisfied with knowing little more of their people than that they die, and that they were born. It were to be wished that enumerations were made annually, instead of at the usual long intervals of time; and in addition to the particulars ordinarily ascertained, such were embraced as, the number of those who can show that they procure their subsistence by lawful means; those who have fixed residences; those who have received a moral education; the nature of employments; the duration and immediate causes of their avocations; bankruptcies; convictions for specified crimes; the known or proximate causes of deaths; cases of lunacy;felo de se; epidemy and meteorological registers made in every department of the country. The collection of information of this kind might be conducted in a manner that would operate as a beneficial supervision of society. It would furnish the police department with a new insight into the sources of delinquency. Taken in connection with coexistent laws which effect trade and revenue, and criminal laws, and the state of markets, political economy would be furnished with new instruments for investigation. The approach of misery might frequently be anticipated and arrested without being exhibited on the poor’s list, in the workhouse, or in the shape of inability to pay taxes. Crimes might be prevented, and better criteria obtained for discriminating between offences committedagainstlaw, and those perpetratedbylaw. A new light would be thrown on several branches of physical science, and particularly on agriculture, climate, and the healing art. It is but too easy to discover that the desideratum is not in unison with the affairs of the age, but it is probable that another Alfred, or a Lycurgus must arise before it can be remedied.—Flint.