The public is acquainted with the fact, that, towards the end of May or beginning of June the Honorable Daniel Webster left Boston, on a tour to the Western country, by the way of Lake Erie. Whilst at Buffalo, he was waited upon by a deputation of mechanics and manufacturers, and complimented in an address, in which his devotion to the protection of domestic industry was particularly referred to, and his aid invoked in "the approaching contest" for the restoration of its lost rights. In the Honorable Senator's reply, he avowed himself an advocate of the Protective System, and gave an assurance that he would be found at his post at the proper time.
This pledge given by Mr. Webster, may be considered as the first move in the game for which it is evident the manufacturers are now preparing. It would seem that the apparent acquiescence of the favored few in the compromise bill of Mr. Clay, was a mere feint to enable them the better to rally after their discomfiture; and as near three years were to elapse before the reduction of duties could be sensibly felt, and nine before it was to terminate, they flattered themselves that possibly before the first period, and certainly before the second, they would be able to strengthen their cause by a coalition with the democratic admirers of General Jackson's Proclamation, and thereby secure a majority favorable to a repeal of the law. To accomplish this amalgamation of parties, required the agency of some influential politician; and Mr. Webster, finding the shoes of the Patron Saint of the American System vacant by the abdication of Mr. Clay, very calculatingly jumped into them, and may now be considered to occupy the identical position, before the manufacturers, which the latter gentleman so long maintained.
Of the subsequent speeches of Mr. Webster on his tour, we have seen no account prior to the one delivered at Pittsburgh, the Birmingham of this country, on the 8th of July. That speech is so full of import, and so fully embodies what we consider to be the doctrines and views of the tariff-proclamation-party, at the head of which Mr. Webster now stands, that we have published it entire in this paper, regarding it as a manifesto of what the foes of State Rights and Free Trade are preparing for the country. If this speech does not savour of unlimited government, we know not the import of terms; and although the orator seems to repudiate the imputation of his being "a consolidationist," and flatly denies that he is one, we should be glad if he would point out the difference between a consolidationist and one who believes the Federal Government to be the sole interpreter of its own powers under the Constitution, and at the same time avows his belief in the constitutionality of a Protective Tariff --of a National Bank --and of appropriation by the Federal Government for works of internal improvement. If we are to have the essence of consolidation, of what consequence is the term which may be employed to justify it ? In justice, however, to Mr. Webster, we acknowledge that there is one power which he admits that Congress cannot lawfully exercise, and that is, to declare the emancipation of the Southern slaves. But we would ask him, in case such a power should be hereafter claimed by a majority in Congress, and sanctioned by the Executive and a majority of the Supreme Court --an event, if not probable, at least possible-- where would be the remedy for the aggrieved parties, for this now admitted violation of the federal compact ? In the right of revolution, it may be answered. But can the right of revolution be predicated of any other government than a consolidated one ? We do not see how any but a negative reply could be given to this question.
But this speech places Mr. Webster in a new light before the public. He has for the last three years been regarded as a free trade man in theory, but a tariff man in practice. He has been supposed to believe the principles of free trade to be sound scientific truths; but, nevertheless, that it would be impolitic to adopt them, in the present attitude of the country. This belief he now discards. He considers that to leave "American manual labor to bear a competition with the unpaid and half-fed labor of Europe, would produce a state of things to which our country can never submit." Now, the only inconvenience which the many in this country could experience from the "unpaid and half-fed labor of Europe," is, that they could get goods cheaper than if the "paupers," as Mr. Webster calls them were well paid and fed; and to look upon this as an evil to the many, is the real New York Convention doctrine. We admit that the few may suffer; but what are the interests of a hundred thousand persons, when compared with those of thirteen millions ?
If we are not greatly deceived, it is time for the friends of free trade again to buckle on their armour. The battle must again be fought, but under circumstances, we think, far more favorable than those which have heretofore existed. Within the last few years, the eyes of the people of the North and West have been greatly opened to their true interests. The title of "American System" has lost a great part of its charm. Political parties are becoming unsettled in reference to candidates for the Presidency. The party in power having no more loaves and fishes to give away, cannot hold its retainers together; and in such a confusion of elements, it is more easy to make impressions upon the public mind, than when it is bound down by the ties of man-worship.
Revival of the American System.
From the Pittsburgh Gazette of July 16.
Mr. Webster's Speech.-- We are much pleased in being enabled to place before our readers a sketch of the able and eloquent speech of this distinguished statesman. Mr. M.T.C. Gould, the stenographer who reported the speech, was much indisposed while performing that duty; it is not therefore to be supposed that the report is so precisely and accurately made as might have been expected had he been in full health; still, however, it seems to our mind that he has performed his task with considerable fidelity, and has generally done the orator justice. A careful reader will, perhaps, in some places, perceive that the connection of the argument is not quite so close and logical as in the deliverance, and that abrupt transitions sometimes occur. No opportunity was afforded to submit the report to the revision of Mr. Webster. The only material deficiency, however, is in the remarks in relation to education. The reporter lives at a distance from Pittsburgh, and in his haste to forward the report by an opportunity which presented, was compelled to furnish a mere skeleton of a portion of that part of the speech, with a request that the Committee of Arrangement would fill it up. That Committee, however, thought it better to omit it entirely, rather than to supply from memory.
Speech of Mr. Webster,
Delivered at Pittsburgh, July 8, 1833.
Mr. Mayor, and Gentlemen: I rise, fellow-citizens, with unaffected sensibility, to give you my thanks for the hospitable manner in which you have been kind enough to receive me, on this my first visit to Pittsburgh; and to make all due acknowledgments to your worthy mayor, for the sentiments which he has now seen fit to express.
Although, gentlemen, it has been my fortune to be personally acquainted with very few of you, I feel at this moment that we are not strangers. We are fellow-countrymen, fellow-citizens, bound together by a thousand ties of interest, of sympathy, of duty; united, I hope I may add, by bonds of mutual regard. We are bound together, for good or for evil, in our great political interests. I know that I am addressing Americans, every one of whom has a true American heart in his bosom; and I feel that I have also an American heart in my bosom. I address you, then, gentlemen, with the same fervent good wishes for your happiness --the same brotherly affection-- and the same tokens of regard and esteem, as if, instead of being upon the borders of the Ohio, I stood by the Connecticut or the Merrimack. As citizens, countrymen, and neighbors, I give you my hearty good wishes, and thank you, over and over again, for your abundant hospitality.
Gentlemen, the mayor has been pleased to advert, in terms beyond all expectation or merit of my own, to my services in defence of the glorious Constitution under which we live, and which makes you and me all that we are, and all that we desire to be. He has vastly overrated and exaggerated any efforts of mine, but he has not overrated the importance of the crisis to which his remarks allude.
Gentlemen, it is but a few short months since dark and portentous clouds did hang over our heavens, and did shut out, as it were, the sun in his glory. A new crisis had arisen in the history of this Government. For forty years our government had gone on, meeting with occasional resistance, incidental, or ill directed --not concerted. But now a time had come, when the authority of law was resisted by the authority of law --when the power of our General Government was resisted by the arm of a State Government -- and when military force, under all the sanctions of State constitution and State law, was threatening to impede the operations of the Federal Government ! That was, gentlemen, a crisis. Every one felt it to be such. I, and every good citizen of the country, felt it to be such. A general anxiety pervaded the breasts of all who partook of the glory of their country at home -- and how was it abroad ? Why, every intelligent friend of human liberty, throughout the world, looked with amazement at the spectacle which we exhibited. In a day of unquestioned prosperity, after half a century's happy experiment --when we were the wonder of all the liberal men in the world, and the envy of all the illiberal-- when we had shown ourselves to be fast advancing to national renown -- what was threatened ? Disunion ! There were those among us, who wished to break up the government, and scatter the four and twenty States into four and twenty sections and fragments !
Gentlemen, it was at this moment that the President of the United States, true to every duty --comprehending and fully understanding the case-- came forth, by his Proclamation of the 10th of December, in language which inspired in me new hopes of the duration of the republic. It was patriotic, and worthy to be carried through at every hazard. Gentlemen, I speak without reserve upon this subject: I have differed with the President, as all know, who know any thing of so humble an individual as myself, upon many important subjects. In relation to Internal Improvements --rechartering the U. States Bank -- perhaps in the degree of domestic protection, and the disposition of our Public lands, I have been not able to see the interests of my country in the way which he did. But when the crisis arrived in which our Constitution was in danger, and when he came forth like a patriotic Chief Magistrate, I, for one, taking no council but of patriotism --feeling no impulse but the impulse of duty-- felt myself bound to yield, not a lame and hesitating, but a cordial and efficient, support to his measures.
Gentlemen, I hope that the result of that experiment may prove salutary in its consequences to our Government, and to the interests of the community. I hope that this signal expression of public opinion, which has for the first time put down the Despotism of Nullification, may produce a lasting effect throughout our whole country. I know, full well, that popular topics may be urged against the Proclamation. I know it may be said, in regard to the law of the last session of Congress, that if such laws are to be maintained, Congress may pass what laws they please, and enforce them. But this argument forgets that members of Congress are but the agents of the people, chosen at short intervals, and always removable at pleasure, by the people, whose servants in the National Legislature are as much subservient, and as willingly obedient, as any other of their servants. It is easy for those who wish, and who pursue measures calculated to break up the Union, to raise the cry of consolidation. But I repel it. I am no consolidationist --I disclaim it. I wish to preserve the Constitution, without addition or diminution of one jot or tittle. For the same reason that I would not add, I would not withdraw. Those who have placed me in a public station, placed me there not to alter the Constitution, but to administer it. If a change be desired, our masters must make that change --if alterations are required, you and the rest of your fellow-citizens must make those alterations. The Constitution is our power of attorney --our letter of credit-- our credentials-- we are to act accordingly, without interpolation or alteration, honestly and truly. The people of the United States --they, and they alone-- can tread it under foot, but their servants have no such power.
And what is the ground for this cry of consolidation ? I maintain that the measures recommended by the President, and adopted by Congress, were measures of self-defence. Is it consolidation to execute the laws ? Is it consolidation to resist the force that is threatening to upturn our government ? Is it consolidation to protect officers, in the discharge of their duty, from courts and juries who were previously sworn to decide against them ?
Gentlemen, I take occasion to remark, that, after much reflection upon the subject, and after all that has been said about the encroachment of our General Government upon the rights of the States, I know of no one power exercised by the General Government, which was not admitted by the immediate friends and foes of the Constitution to have been conferred upon it by the people, when that instrument was adopted. I know of no one power which every body did not agree, in 1789, was conferred on the General Government. On the contrary, there are several powers, and those, too, among the most important for the interests of the people, which were then allowed to be conferred by the Constitution of the United States, which are now ingeniously doubted, or clamorously denied.
Gentlemen, upon this point I shall detain you with no further remarks. It does, however, give me the most sincere pleasure to say, that, in a long visit through the State west of you, and in the great State north of you, as well as in a tour of some days' duration in the respectable State to which you belong, I find but one sentiment in regard to the conduct of the Government upon this subject. I know that those who have seen fit to entrust to me, in part, their interests in Congress, approve of the measures recommended by the President. We see that he has taken occasion, during the recess of Congress, to visit that part of the country; and we know how he has been received. No where have hands been extended with more sincerity of friendship; and for one, gentlemen, I take occasion to say, that, having heard of his return to the seat of government, with health rather debilitated, it is among my most earnest prayers, that Providence may spare his life, and that he may go through with his administration, and come out with as much success and glory as any of his predecessors. [Great applause.]
Your worthy chief magistrate has been kind enough to express sentiments favorable to myself, as a friend of domestic industry. What a world of remark does that suggestion open, when standing at the confluence of the two streams that constitute the Ohio, in the midst of a population distinguished for their domestic industry, family comforts, the means of education, and the means of providing for their families by their industry. What is not comprised, here, in "the means of protecting domestic industry ?" Next to the Constitution itself, there can be no question of more absorbing interest, than the protection of our own domestic manufactures. I do not mean any particular class, but the whole, as comprehended under that system which provides for our wants --that system whose essence, and object, and life, it is to administer compensating rewards to American manual labor.
Gentlemen, those of you who have taken any pains to inquire into the history of that part of the country to which I belong, know, that in the quarter with which I am more immediately connected, the people were not early to urge upon the Government protection by high duties. Indeed, candor obliges me to acknowledge, that, when the Act of 1824 was passed, neither he who now addresses you, nor those with whom he acted, were ready or willing to take the step which that Act proposed. They were not prepared to act; they doubted the expediency. It passed, however, by the great and overwhelming influence of this central section of country, New York, Pennsylvania, and Ohio. We acquiesced; we yielded to it, adopted it, and gave to our capital and labor such direction as would enable us to conform to the policy of the country. We have become wedded to it, and identified with it, till I know of no shade of difference between the interests of Pennsylvania and Massachusetts. We shall not yield it without a struggle. Neither shall we yield the principle of protection, without a severe struggle, under any circumstances whatever. And who would choose to yield it ? Who, standing here, and looking round upon this community and its interests, would be bold enough to touch the spring to so much industry and so much happiness ? Who would stop the mouths of those vast coal pits ? --arrest the cargoes that are now running down a river the noblest in the world, and which stretches over the finest territory possessed by any government ? Who would quench the fires of so many steam engines ? It cannot be done without great public calamity, and great private distress.
I have said that I am in favor of protecting American manual labor --and after all that has been said, I have come to the conclusion, that, to leave American manual labor to bear a competition with the unpaid and half-fed labor of Europe, would produce a state of things to which our country can never submit. This is the reason why I maintain the policy of the American System. I see in my own country, and I believe it is the same in this, that its stimulus to labor has been its offering a fair compensation for labor. When I say our country, I mean from Penobscot to New Orleans; for nine-tenths of the whole belong to the industrious, productive, laborious classes. Dead capitals are in but few hands; and this system does not promote the interests of the capitalist one tithe part what it does those of the laborer, the industrious man who oversees, or labors upon, the capital of another. Is it not this great stimulus which mow applies itself to our whole society, and sets so many wheels in motion ? Is it not the compensating price of labor --is it not that labor is high and the means of living low ? I want no other proof that God has blessed us with a happy country and generation.
Suppose we compare ourselves with other countries --I see many whom I know to be emigrants from other countries. Why is the native of Ireland among you ? Why has he left the land of his fathers ? The Emerald Isle is as dear to him as these rivers and hills are to you. Was it not taxation on one hand, and the low price of labor on the other, that induced him to come to a country of free laws, and of boundless extent; where industry has its reward --where the means of living are low, and the price of labor adequate ? And do not these remarks apply to the emigrants from every part of Europe ? Is it not that industry and personal character can do more for a man here, than in any other part of the world ?
Our government is the breath of the people's nostrils; they made it, and they appoint agents to administer it. The people are the source of the power of our government; and is it not clear that it is unsafe to trust the affairs of government in the hands of the people, unless the great majority of the people have some interest in the government ? Who would be safe, in any community, where the power is in the hands of those who have nothing at stake ? It is the true policy of our government to shield the great body of the people --the productive classes.
Gentlemen, it appears to me so plain a proposition, that the industry of this country ought to be protected, and must be protected, against the pauper labor of England and other parts of Europe, that argument is superfluous. Were it not for trespassing upon your patience, I would state, as a historical truth --for it is beyond all question-- that a leading object of establishing the Constitution was to devise a system of laws to protect artisans against the cheap pauper labor of Great Britain. In the town in which I live, it is as notorious as the Revolution itself.
Soon after, the peace of '83, there came on a period of distress over the whole Atlantic coast, far exceeding any thing that had been felt during the war. Importation in British ships was free --American ships there were none. The cheaper labor of England supplied the inhabitants of the Atlantic coast with every thing, from the crown of the head to the sole of the foot. The merchants of Boston appointed a committee, at the head of which was the name ever venerable to the mind of all true Americans, John Hancock, by whom strong resolutions were reported, declaring that the inhabitants would not use any articles imported in British ships. The mechanics of Boston met and recommended the inhabitants not to use British articles at all. [Great applause.] "For," said they, "with regard to you, Mr. Hancock, what odds does it make, whether our shoes, boots, hats, handkerchiefs, or shirts come in British ships, or American ships --they take away our bread, come in what ships they may."
This State, the State of Massachusetts, and even the State of Virginia, passed laws to protect their own people by impost. But it could not be effectually done. One State would pass a law --another would not-- there being no general system, there could be no protection. And it is a historical truth, plain beyond doubt, that our great object, along the Atlantic coast, in adopting the Constitution, was, that by establishing a regular and uniform system of imposts, the various artisans and handicrafts might be permitted to earn their bread. There were at that time no manufactories in the interior, for there were no inhabitants. Here was fort Pitt, upon the map to be sure --but no people. Among the mechanics --the workers in leather, tin, iron, &c., there was a greater depression and poverty than there had been during the war. And I hope you will pardon me for another anecdote which is brought to my recollection.
Massachusetts was the ninth State to adopt the Constitution. If she adopted it, it would go into effect; but it was matter of great doubt whether she would. The mechanics of Boston met and passed resolutions. They said it was necessary for them. They elected delegates to adopt the Constitution. Their proceedings were communicated to Samuel Adams. He had doubts, --he was a friend of liberty, but he had honest and sincere doubts about the practicability of a general government. Paul Revere, a worker in brass, read to him the resolutions of the mechanics. He was asked how many mechanics passed these resolutions --(the meeting was held at the old Green Dragon)-- was the room full ? Oh, yes, overflowing. Were there any in the streets ? Many. How many ? More than the stars of heaven. [Laughter and applause.]
It was thus the Constitution of the United States was carried. Any gentleman desirous of pushing the historical inquiry, will find that the great and prevailing interest was where there were merchants and mechanics. There was a natural hesitation about the adoption of the Constitution; and it was only urged through by the interests to which I have adverted.
Under these circumstances, it cannot be expected that we, of New England, will readily abandon our ground. We are ready to do more work, with less protection, if that will answer; but we yet believe that the power is in the Constitution. And I do not believe that it is within my competency to draw my pen across that power; for I have no more power to diminish, than I have to add. And, acting in the situation in which we are placed --as a portion of the great American family-- having the same interests as these great and vast central districts -- we shall go on, attached to the Union, attached to all the great interests of the Government, and attached to the Constitution.
Your worthy mayor has alluded to the subject of Internal Improvement. Gentlemen, it has always seemed extremely strange to me, that in the progress of human knowledge and human virtue --for I believe that human virtue is making rapid progress-- it has always seemed extremely strange to me, that the objects of government should be limited so much to belligerent operations, that its duties should seem to be considered as referable so exclusively to wars with other nations. Certainly, in a day of Christianity, in a day of light and knowledge, of benevolent feeling and action, it should be the business of Government to turn its attention inward; to remember that the objects of its supervision are rational, immortal beings; and to seek to promote all great interests, so far as may be within its constitutional power; and surely, within that range are objects far more worthy of zeal and assiduity, than such as look to our external relations --to war, or victory, or triumph.
What, in our day, has been done by voluntary association ? Our whole Government is a voluntary association: Why should it not direct its attention to those things which look to peace ? Upon this subject, I will observe, that when I came into Congress, on taking a view of the country, and its interests and concerns, at the close of the late war, I thought it to be my duty to say that a suitable time had come for Government to turn its attention inward --to survey this vast country, and particularly this vast Western country-- to take a comprehensive view of the whole, and to promote the interests of the whole, by the construction of roads, canals, and other means of internal communication --to adopt a liberal system of internal improvement, in whatsoever unites man to man; in whatsoever opens a better market, by clearing the way between the producer and the consumer; in whatsoever connects more intimately the various parts of our country, and binds us closer and closer together. The West, with which I am no more connected than with all my fellow-citizens, is the great theatre for these internal improvements. The East is old --not only old, but small. Our rivers can be measured, yours cannot. Our forests can be surveyed, yours cannot. We are bounded, you are boundless. It has appeared to me, that the West, the fertile, the opening, the soliciting West, was a proper object for the regard of Government. To clear the rivers, to improve the harbors upon our lakes, to open roads and canals, to do whatever might unite the people, and bring him who sells and him who buys nearer together, appear to me to be objects worthy of all regard. I claim no particular merit upon this subject --it is from no partiality to the West that I would tend aid to all these objects. My affections know no West --no East --no North, --no South. I would comprehend them all in one great and connected whole, and then consider it my country.
I see this place, gentlemen, surrounded with circumstances strongly enforcing these truths: you have vast internal improvements --the most prominent of which is your canal, which connects you with the Atlantic ocean; others are projected. The Ohio Canal, which does so much credit to our young sister of the west, and with which your city needs a direct connection --the Ohio and Baltimore Rail Road, an arm or branch of which extending to your city would be peculiarly beneficial, and which is as much entitled to aid from the General Government as the Ohio and Chesapeake Canal: with respect to these, and many others, it has always appeared to me, and I make no merit of it, that it is the duty of our Government to lend a generous countenance.
One word more, gentlemen, and I have done.
The mayor has spoken of Education: and can any man doubt, as a social being, as an immortal being, as a being interested in the world that is --as a being vastly more interested in that which is to be-- that Education is the general business of man ? I take not back one jot or tittle of the expression. Education, the formation of the mind and character, by instruction in knowledge and instruction in righteousness, is the great end of human being.
Gentlemen, it is most gratifying to witness the attention which has been aroused, not confined to latitude or longitude, upon this subject. In the progress of some five or six weeks in the State west of you, and a part of the time in your own State, I have marked it with delight. The western world --our whole west-- is full, beyond all comparison full, of aptitude and claims to instruction. The country is young, and settled with parents who have many children, whose means are not affluent, but who eagerly seek education. The demands are fast increasing, and becoming more and more urgent and imperative.
Under free institutions, literature, knowledge and morals, might well be expected to flourish; but we are setting the great example which all Europe may look upon with astonishment --that, with popular institutions, and under a system of absolute toleration, we see no indifference to the great cause of Religion. We have denied a political sanction to any sect; yet places of worship are seen to spring up in every direction, and of every denomination. Toleration begets no indifference; but zeal, rather than indifference. It is connected with education, with the intellectual and moral culture of the mind; and wheresoever men meet to worship the God of their fathers, I wish them the means of instruction and the means of adequately conducting the great and good work.
Gentlemen, I have detained you too long.
My friends, my fellow-citizens, my countrymen, I must now take a respectful leave of you. I have spent a period of five or six weeks west of the Alleghany, for the first time in my life. It has been a series of happy days. I have seen much which I shall always remember-much to inform, as well as delight me. I return you, again and again, my unfeigned thanks, for the frankness, and kindness, and neighborliness, with which you have made me welcome: and wherever I may go, or wherever I may be, I pray you, my friends, to believe I shall never lose the recollection of your kindness. May God bless you all.
Clinton Roosevelt on the Currency, Political Economy, &c.
In the year 1832 Mr. Roosevelt published an address to his fellow-citizens, embracing a proposition of a new system of political economy. The object of the author will be best understood by quoting his own words.
"In laying open his plan, the writer will be very brief, for he knows the case to be one of extreme difficulty to the people; and the question, like a stony gum, is not to be solved by rivers of words; if solved at all, it must be by concentrated spirit.
"To be understood, we must trace up to the principles of our present policy for the encouragement of domestic commerce and manufactures. The famous report of Mr. Hamilton, of 1790, laid the foundation of the tariff; and to Mr. Hamilton the merchants acknowledge themselves indebted for the establishment of the banking system, also for the facilitation and encouragement of domestic commerce. The tariff was evidently intended to operate on the principle of raising the prices of foreign articles when brought in competition with domestic in our markets; and the banking system was to give the people more money, that they might make more purchases.
This address was followed, in 1833, by a pampblet [The Mode of Protecting Domestic Industry, Consistently with the Desires Both of the North and the South, by Operating on the Currency] explaining his views on the new system of political economy, based on the protection of our home industry. Upon the first appearance of this writer's opinions they were ridiculed as utopian and visionary by many even among our own party. Time, however, which alone can sustain the opinions of men, has proved that they were the productions of a reflective mind, based upon a deeply comprehensive survey of the existing evils in the currency under which we have laboured and are now labouring. The object of Mr. Roosevelt is, to show that the Tariff or American System, founded by Alexander Hamilton, and the Banking System neutralize the effects of each other. We give below his review of the American System:
Review of the American or Hamiltonian System
1. "Having seen strange and unexpected results from the system founded by Alexander Hamilton, for the protection and encouragement of manufactures and commerce, the writer has been induced to look for first principles, and by them try whence the good and whence the evil flows. His results have astonished even himself. They are so far from all the received opinions of the people, that it will require much patience to examine, and much magnanimity to admit, the correctness of our arguments however well supported it may be.
2. "It is not our to purpose to shake rudely the urn of a departed hero. May his ashes be steeped in tears, and not scattered to the winds. But as every man has his excellences and defects, the greatness of the name of Mr. Hamilton should not deter us from an examination of his work, particularly when so connected with national and individual wealth and happiness as the system is which we propose to review.
3. "We have discovered, and design to show, that this system under which the people are labouring, is contradictory; that, notwithstanding our high tariff, our ports are, in effect, open to the world, in theory as well as practice. Nay, more; that we have given foreigners an advantage over our own citizens in our own markets, by the very acts intended to encourage domestic commerce and manufactures.
4. "it is hard to frame an acceptable arguement in a science so little understood as political economy; but truth is simple when discovered, and we hope to render it plain to the most indolent minds. To do so, we shall avoid unimportant considerations, and draw our conclusions from simple facts, with which the world is acquainted.
5. "We all know that to facilitate domestic commerce and manufactures was the intention of Mr. Hamilton.
6. "That, for the facilitation of domestic commerce, he established the original United States Bank. It is true there were other objects in view in thsi, but they are not connected with our present arguement.
7. "That, for the protection and encouragement of domestic manufactures, he laid the foundation of the tariff; and,
8. "That, since Mr. Hamilton's day, to increase the tariff and the number of banking institutions, has been the real American system, which is so unfortunately contradictory.
9. "Now, how was it anticipated that the banks and tariff were to encourage domestic commerce and manufactures ? Every one will answer, the banks were to furnish the people with more money, that they might make more purchases, and,
10. "The tariff was to raise the prices of foreign goods so high, when brought to our markets, that domestic manufacturers wwould have an advantage, by thus being enabled to offer their fabrics cheaper.
11. "Then it was by raising the prices of foreign goods if brought in competition with domestic, that domestic goods were to be preferred. Let us not forget this.
12. "We intend to prove that, by the banking system, prices of domestic productions have been raised as high, and sometimes higher, than the tariff raises foreign productions in our markets; and it is because both the tariff and the banking systems (so called) have alike effect on the prices, that the obvious purpose of each is destroyed, and the Hamiltonian system is nugatory and worse, much worse, than none at all -- it is ruinous. By the banking system the circulating capital of the country has been greatly increased -- this we all know.
13. "Now, it has ever happened, that the increase of the circulating capital of a country, or the world, has raised prices accordingly. Look at the history of the bank of England --of the assignats of France, &c. Look back also to the time before the discovery of the silver mines of South America. Before they were discovered and specie was distributed, (for too much specie in circulation has the same effect as too much paper money,) prices generally were much lower than after, as every reader of history knows. Improvements in machinery have brought down the prices of some articles, but the exceptions do not affect the principle.
14. "The people have seen with their own eyes the effect of the increase and decrease of the circulating capital of our country on prices, but they have not notices it in connexion with this subject.
15. "In the years 1815-16, according to the report of Mr. Crawford, ex-secretary of the treasury, we had 110 millions of our mixed currency in circulation, and in 1819 45 millions. Who does not remember that prices were high and low accordingly ? At the one time our standard of values, viz, a day's labour, ranged from one dollar to two and a half dollars; at the other, from half a dollar to about one and a quarter, and of course all that was produced by labour was affected accordingly.
16. "Such is the case always in every country, and no instance to the contrary can be adduced. Much money makes prices high, and a little, low, of course. Recollecting that men generally are governed in their purchases and sales by prices without regard to abstruse arguements, let us come to the main point.
17. "We have increased the circulating capital of our country, and have thus raised the prices of domestic productions. We have established a tariff, and thus raised the prices of foreign productions presented in our markets.
18. "View the facts in connexion, and the astonishing fact that we intend to prove appears. Our ports are, in effect, open, notwithstanding the tariff, because the increase of the circulating capital which has taken under the system for the encouragement of domestic commerce, has raised the price of domestic productions so high as to destroy the inducement to prefer domestic productions, on the score of prices as intended by the tariff.
19. "We need not prove that foreign productions are brought in competition with domestic, notwithstanding every increase which has taken place in the tariff. All see this.* It is this we intended to account for, and have done so; for a cause sufficient has been shown; viz., an increase of prices to such an extent as to enable the foreigner to pay our duties and still retain a profit; and this being a sufficient cause it is unphilosophical to look for any other."
After animadverting on the above system, the author thus proceeds:
"We now offer our measures for the protection of both northern and southern industry, and all that wealth can secure to a nation. It is just the reverse of the system now in operation, as projected by Alexander Hamilton. Instead of operating on foreign goods to raise their prices in our markets by means of a tariff, we must operate upon the currency, and, by re reducing the amount of bank paper, cause the money prices of domestic productions to sink below the money prices of goods in England.
"Then, as in consequence of the withdrawal of bank paper from circulation, money will become more valuable; all money obligations and debts must sink nominally in amount as the money really rises in value.
"If it should be asked how debts and money obligations are to decrease, as money becomes scarce and valuable by being withdrawn from circulation? this is the rule: 'As the amount of the debt contracted is to the amount of the currency of the Union at the time the debt is contracted, so must the sum to be paid be to the amount of the currency at the time it is to be paid.'
"For instance: A person has contracted a debt of a thousand dollars while there are a hundred millions of dollars in circulation, and government has determined that there shall be only half that sum in circulation at the time it is to be paid. By the rule above given, only five hundred dollars will be paid, for, as one thousand is to one hundred millions so is five hundred to fifty millions, and so is the value of money altered. Five hundred dollars will buy as much property in our country when there are millions circulation here, as one thousand will when there is twice the amount. Small exceptions may be made, but there is no more perfect rule to be given while the present kinds of money are in use. Without this rule, when the currency is reduced, those in debt must be greatly injured, if not entirely ruined. They cannot collect moneys due to them, and they must sacrifice twice as much of the produce of industry to procure one thousand dollars when there are fifty millions in circulation as when there are one hundred millions, and it is value for value that honest men desire to give, and not a great value for a small one. None but dishonest men can desire others to lose unjustly that they may gain.
"Tables like interest tables can be constructed to render the system easy to the most ignorant, and periodical accounts of the amount of the currency will take away all excuse from those who will desire to say, 'there is a lion in the way,' and it cannot be done.
"These are our measures for the protection of domestic industry of all kinds, and the satisfaction of our southern fellow-citizens, who, by this means, may be enabled to buy their supplies cheaper at the north than in England, while our manufacturers may undersell the British in every market in the world."
It will be seen by the above extract that the opinions of Mr. Roosevelt are original and powerful. He seeks to establish national prosperity on a firm basis; or one which can scarcely be affected by external circumstances --but in which all the sections of our country may have an equal interest and an equal benefit.
He acknowledges that the tariff system will enhance the price of foreign goods in our market, and thus far raise the price of home industry; but how does the banking system, under the views of our author, interfere with this seeming good ? Why, the immense amount of our principal circulating medium, paper, raises the price of our home produce so high, that the foreign merchant can afford to pay the duty, force his goods into our market, and undersell us, with the tariff staring him in the face ! Nor is this by any means the extent of the evil. We become impoverished by our commerce: the exchanges are always against us. The European merchant will not accept of paper in return for his merchandise. Many of the goods are sold by auction; the precious metals are demanded in payment; the merchants crowd to the banks to convert their paper, by discount, into money; the hanks become alarmed --they curtail their accommodations; a panic ensues; and bankruptcy, as a natural consequence, follows. It would, indeed, be well if such bankruptcy were confined to individuals, and did not embrace States and Nations. But for years past our bankers have been pledging our most valuable stocks in the markets of Europe, to obtain banking capital. The day of redemption has come, and we have been diagraced at home and abroad. Our state bonds have been repudiated, and our National Treasury is -- empty.
Banking System as at Present Established.
As a preliminary to his forcible attack on the present system, with its ruinous results, our author predicates his argument upon the following assumptions and propositions:
"What are the great advantages of the system we oppose ?
"We are to weigh them against the disadvantages, and the people must decide.
1. "It is said banks make money abundant, and a scarcity of money is a great evil.
2. "It is said they afford a cheap circulating medium.
3. "It is said they afford a light and commodious medium of exchange.
4. "It is said they assist government with loans in time of war.
5. "It is said they build up towns and cities.
"We will examine then assertions, and then state the disadvantages of banking."
Mr. Roosevelt proceeds to show, in answer to the first assumption, "it is said banks make money abundant, and a scarcity of money is a great evil," that an abundance of money is one of the greatest evils which can befall a nation; the real value of money consists, says our author, "in the fitness of a small quantity to represent the fruit of much labour." Whoever examines the above quotation with candour, must admit the truth of the principle upon which it is based. To render money abundant, therefore, is to lessen its value. Our banks, consequently, depreciate that value in money which arises from "little things being the representative of great things. In answer to the second assumption, "that banks afford a cheap circulating medium," we give the author's reply.
"To whom, we would ask, to whom is it cheap ? There are about twenty millions of specie in the United States by the latest accounts we have seen, and from eighty to upward of one hundred millions of paper, say one hundred millions.
"That one hundred millions is let out at the rate of from six to ten per cent. from banks in various sections, and, when banks curtail discounts, a part of it at from ten to fifty per cent. by brokers. When let out by banks on "short paper," the same money is let from four to six times a year, and it amounts to compound interest, for interest is deducted as the money is loaned, and let out before it is due for the use of the money borrowed. This is the practice in all the banks. Moreover, borrowers of money from the banks are generally expected to leave a balance in the banks to secure credit and loans when they require them, and no interest is allowed for this, as in England, but it is let by the bankers, and they keep all the interest for themselves. Thus the usury laws are evaded to incredible amount. In Holland silver and gold money may be had on good securities at from two to three per cent. per annum, and in England from three to five per cent. Cheapness and dearness being relative terms, the cost of our paper money to borrowers may be compared with the cost of specie to borrowers in Holland and England, and we will abide the comparison.
"In reply to our own question, to whom is it cheap? we answer, it is cheap to those who are allowed to print and receive interest for five paper dollars for every silver one they possess, but to every one else it is usurious to the last degree. To bankers only is it cheap.
In noticing the 5th assumption, "that banks build up towns and cities," our author thus forcibly and eloquently speaks:
"Go through the western, eastern, or southern country, and see if the far greater proportion of the property which has not been gained entirely by the owners of banks, is not mortgaged to them. Princely mansions have sprung up, as if by magic; but eight years is generally as long as the enterprising builders can hold them. Then they are swept away, with all the fruits of former toil, into the hands of the directors of banking institutions. In this way cities and towns are built. Look at Cincinnati, now just recovering from a dreadful blow. Indeed, look at any town six or eight years after a bank has been established in it, and see if industry has not sown and cunning has not reaped the fruit in the shape of deeds and bonds and mortgages held by bankers, if not by banks, for what they never gave an hour's effective toil, excepting in cunning financiering art.
We pas over Mr. Roosevelt's remarks on the "United States Bank" in support of his general argument; his facts and predictions are true to the letter; they have been unfortunately too fully substantiated in the fall of this mammoth plunderer and the ruin which exists as the sad memorial of its once proud and vaunted condition. Mr. Roosevelt shows, in page 31 of his pamphlet, the fallacy of the supposition, that banks increase the wages of the mechanic and labourer. In support of his argument against this unfounded assumption, he quotes from Mr. McCullock. It appears, from the quotation, that prices in Great Britain were twice as high in 1810 as in 1790; consequently, that the tendency of money to be sent out of England to buy goods, at a rate cheaper than they could purchase on the island, was twice as great in the latter as in the former year. What was the consequence in 1810 ? Why, that millions were thrown out of employment and in a state of actual starvation; a consequence of the high price of English goods. Specie was drawn from the country, and between 1790 and 1810 the Bank of England was compelled to suspend her payments in the precious metals, from the fear of total destruction --a destruction arising from increasing the price of British goods on British soil, by a fictitious paper currency, and the exportation of her real money to make foreign purchases cheaper than they could be obtained on her own shores.
In support of his seventh proposition, "that banks destroy our power as a nation and render us subject to foreign enemies," we can add nothing to the forcible language of our author.
"Money --specie-- being the great instrument of war, by establishing banks like ours, bankers do the very thing against us which our foreign enemies desire to do, viz., drive out good money, and leave to us no funds to support a war.
"What made our government paper sink thirty per cent. below per during our last short war ? Our enemies were owners of the foundation on which our worthless currency was based, and they were constantly withdrawing it, if report spoke truly, via Boston, and all knew that no money could be paid if all withdrawn from the country.
"What is our condition now for war ? Who are owners of the twenty millions of specie in the United States ? The English government, whenever it chooses to be. Englishmen own more stock in the United States Bank than the specie remaining of all its specie capital can redeem, viz., about eight and a half millions. The majority of the stock of one of the city banks of New York is said to be held in trust for Englishmen; other banks in other states are, to a greater or less extent, in like condition. Canal stock and real estate and mortgages are also held in trust, to a large amount, for foreigners. The United States Bank is allowed to be in the best condition, and we know in what a miserable plight that is, to withstand a run for specie ! Thirty-five millions was its original capital, borrowed at an expense of half a million. It has, with what it has in England, say one-third of the whole amount remaining. It is true the people are bound to it by every obligation that the law can impose, sufficient to make a fair appearance of solvency; but so much the worse for the people, if they are bound to pay what it would be absolutely impossible to pay, were the enemies of our country determined to strike a blow at our strength.
"Were the British government to buy the stock held by its subjects in the United States, and instruct its naturalized agents to sell it for paper notes, and with those notes draw out its specie capital, what then would become of all the property of which such a fair show is made to prove the solvency of the institution ? It must be sacrificed for little or nothing. Money can not be procured where there is none. Suppose a house, said now to be worth fifty thousand dollars, were to be sold at auction to close a concern, and there were thousands of bidders, and not one could command five hundred dollars, what would it sell for ? It must be sacrificed for little or nothing. So says every day's experience. Where there is little or no money, goods and property bring little or nothing. To attempt to prove the solvency of the United States Bank, from the nominal price which its paper and the paper of other banks, equally unsound, affixes to property pledged to it, is to reason absurdly in a circle.
"Would the property pledged to the United States Bank be worth, in money, what it is said to be worth, if the bank paper which is considered valuable only so long as it may be exchanged for specie, were to have the specie on which it is based withdrawn ? Why ? It is the bank paper which affixes the nominal value to the property pledged to the bank; and when the specie is gone the nominal value is in a great measure gone. It is not airy castle building for the banks first to give a nominal money value to property, and then prove from that nominal money value, the money value of the stock, after near two-thirds of its real money capital has been lost ? The prices of all the productions of industry and property depends upon the proportion which the circulating capital of a country bears to the productions of industry in the country. It is true, foreigners, having perfect confidence in the stability of institutions, would never suffer our property to be sacrificed for nothing. They would give half price for it, perhaps, and buy us out of house and home if that be good, but probably not so much; for when our currency was reduced from one hundred and ten down to forty-five millions, property fell in nearly the same proportion, although that was after the war, when mistrust cannot be so great as just before a war. An account of that time, by the Philadelphia Society for the Promotion of National Industry, says, 'real estate is everywhere fallen thirty, forty, or fifty per cent.;' and in the next page, 'the interest of money extravagantly usurious, and all are doing a most unprofitable business except usurers.' A proof to those who will not examine the theory of money prices, that property fell in consequence of the then existing scarcity of money."
From the numerous quotations we have made, the object of the author, we trust, is rendered clear to our readers; it is to operate on the Currency, by compelling the banks to curtail their circulation, and to suffer none to exist, save those which are based on a metallic capital, and which can redeem every dollar of paper, in gold or silver. Our overgrown landed proprietors, who have been enabled to purchase real estate for paper, and who in every case in which a panic arises, founded on a sudden curtailment of the currency, and a refusal on the part of the banks to extend their accustomed discounts, have doubled their property, by foreclosing mortgages and buying the hardly earned dwellings of their less fortunate brethren at half their true value; the freeholder who is enabled to discount good paper at from 2 to 4 per cent. per month, and thus ruin those whom he professes to benefit, will ever be found hostile to the declaration of such political opinions as those avowed by Mr. Roosevelt. Their appeal is to common sense and to reason. In relation to the "United States Bank," every prediction of Mr. Roosevelt has been fulfilled too fatally.
Mechanic and labourer, examine this work for yourselves; try its principles at the bar of judgment, and let not higher impositions on foreign produce --in other words, a revision and increase in the tariff-- delude you into the belief that you can receive any substantial benefit while the present banking system exists. The "state of Denmark is rotten at the core." We have been living for years amid pleasures founded on ideal wealth. We have recklessly bought and sold for paper --we have mortgaged ourselves to our banks, and our banks have mortgaged us, as a Nation, to Europe. Our banking system has at length called into operation a bankrupt law, not more necessary to the individuals upon whose destinies it is to operate, than to the government from which it emanated.
In closing our remarks on Mr. Roosevelt's pamphlet, we know not whether most to admire the research or the candour which it evinces. His arguments are "pro" and "con" --fairly stated and candidly answered; and we take leave of his valuable little work with a sincere hope that our friends of the producing and working classes may avail themselves of the valuable information which it contains.