This section is from the "The Science Of Wealth" book, by Amasa Walker.
The intercourse between the United States and Austria is but trifling. A little fire would kindle great strife between these two peoples. There would be no great motive to forbear and adjust the occasions of dispute. The United States and England, on the other hand, have a yearly trade of four hundred and fifty millions of dollars, which interposes itself between the nations, however angry, a great standing policy of peace.
All general economic principles urge the extinction of war. All special economical interdependences postpone and weaken the provocations of war. Resting on this principle, we shall find nothing good in the scheme of making nations independent, that they may the better fight. "We shall recognize commerce as the great bond of human brotherhood.
But, after all argument has been closed on the principles of protection, we still find one plea remaining. If freedom of intercourse, it is said, were only universal, it would be well; but, since it is not, each nation must protect itself, and do as it is done by.
Let us suppose that England refuses to take our wheat. Would that be a good reason why we should not take iron from her, if we get it so, cheaper than by making it? We have already shown that the protected suffers more than the excluded community. If England should exclude our wheat, whom would she injure? Ourselves somewhat, that is, to the extent of the profits we should have made; herself still more, that is, to the extent of the vastly enhanced cost of the grain. If, in retaliation, we exclude her iron, whom do we injure? Her somewhat; ourselves much more.
Let us examine more in detail the consequences of our exclusion from foreign ports. If partial, we could still, by selling our wheat, get iron cheaper than by making it.
If total, the closing of our markets for wheat could turn our industry towards other forms of production. This would constitute one of the conditions under which manufactures would legitimately arise; and it would be more sensible and healthful than if it came as the result of our own restrictive legislation.
The full consequences of the policy of retaliation would be, each people refusing to receive the products of others, trade annihilated, industry crippled, all nations isolated, with no mutual interest but robbery and plunder.
We have said, that England, by imposing a duty, say of fifty per cent, on our wheat, would injure us to the extent of our possible profits, and herself to the extent of the enhanced cost of the grain. On a closer inquiry, we shall see that the injury to ourselves is compensated in part; that to herself is aggravated.
The consequence of such a duty would be, that the consumption would fall off in some degree. Her poor would subsist more on potatoes, or other articles cheaper than flour. But, notwithstanding these shifts, it would be found that it cost her laboring population more to live, even though they lived more meanly. Their wages must be raised: this is certain. All taxes laid on commodities which the laborer must use have the effect to reduce the quantity or quality of his food to a certain point; but he must live, and his wages must be raised to enable him to do so with the enhanced price of wheat. This would make it more expensive for England to manufacture her goods, and would, in part, so far reduce her ability to compete in the markets of the world. By such a policy, she would weaken her own industry, and to a degree exclude herself from commerce. This would afford another condition under which manufactures would legitimately arise in this country, whose wheat was excluded.
That this is no impossible supposition, will be evidenced by the condition of England before the repeal of the corn laws. The movement in favor of that great measure originated in Manchester, and was carried, against the nobility and the landed interest, by the resolute efforts of the manufacturing class.
What advantage is there in refusing to buy of a nation because it refuses to buy of us? It is retaliation and revenge, not self-defence or self-vindication. The first Historical instance of such retaliatory legislation is the establishment, by the Venetians, of customs duties, to deprive foreigners of the benefit of their trade; in return for which, Charles V. imposed twenty per cent duty on all Venetian merchandise. The most wise and useful economical act of this century was that by which, by the exertions of Mr. Cobden, England and France, so long contending only in exclusions and mutual injuries, threw open their ports to the free entry of hundreds of articles, to the common benefit of both, and to the advancement of good feeling and hearty alliance; a measure, that, between the years 1859 and 1863, increased by seventy-three per cent the trade of Great Britain with France, while proving no less beneficial to the labor of the latter country.