This section is from the "The Science Of Wealth" book, by Amasa Walker.
And the iron interest clamors loudly and successfully for more protection. Fifty per cent is not enough for the people to pay extra on iron. These are not accidental or peculiar results, but natural and certain, where the great laws of trade and the even course of production are disturbed.
We have seen these marked effects of protection in the protected country. How of the excluded country?
Just so far as the " protection " is adequate, England cannot send us iron. What then? So much of her iron trade is cut off; and her capital and industry must be directed to raising wheat, or to some other less profitable, productive, and natural employment. A part of it is forced into wheat-growing, and this reduces the quantity she would naturally require of American wheat. Her industry is made less advantageous; our market is correspondingly diminished. So far as her labor cannot find employment, it must emigrate, as it has done by crowded packet lines, to Australia, Canada, and the United States.
Which country will be most injured by this commercial warfare?
We answer, decidedly, the protected, because England would not have made, on the iron sent us, more, say, than ten per cent; while we make a clean loss, as we have seen, of some thirty or forty per cent; that is, all left of the fifty per cent enhancement of price, after the profits of the American manufacturer are deducted.
But it may be urged, that, if a part of the labor of the country had not been taken from agriculture, its products would have declined in value, and this would have counterbalanced what was lost by the manufacture of iron. This is a favorite view with a certain class of minds. There are many theorists who are continually foretelling the decline of prices, and general starvation; many business men, who are expecting daily to exhaust the market, and reach the limit of their industry; many householders, who dread the disappearance of fuel and light from the earth, with untold horrors beside. Such persons are much afraid of using nature up.
The markets of the world being open to us, all our surplus products would remain in demand. Provisions, especially, are a sort of " legal tender " the world over; and there seems to be no immediate occasion to anticipate their disuse. There is no market that keeps open so long and surely as this. The English ports were wrested from the monopolists of grain, by a power-that government and society could not resist, — the power of indignant want. The misfortune of overdone agricultural products is one that statesmen may well leave to their successors.
But, if there were no other markets open but those at home, there would be a certain tendency, not at all frightful in its vehemence, to a decline of prices, in a country like ours; because an agricultural people, under favorable circumstances, always produces more than it consumes, and would, sooner or later, create such a surplus as to lower the price. Admitting, then, all that is claimed for such a possible glut, let us inquire into the results.
As soon as wheat, to take it as the exponent of all agricultural products, had fallen so low that it required as many days' work to get a ton of iron by raising wheat as by working the ore, the manufacture would be successfully introduced. That is precisely the point at which this branch of industry would legitimately begin. It would not spring up suddenly, at some arbitrary point, but grow up in those places where the natural protection was most felt, and facilities for production were greatest; for instance, in a region far from any considerable market, where iron could only be obtained by long and expensive transportation, where the land was not adapted to wheat, but where ore, coal, and lime were plentiful. It would extend to all parts of the country where it was as advantageous as wheat-growing. The business would be introduced without any disturbance of existing interests; without wild, extravagant, and wasteful experiments. It would be a natural development and growth, not an arbitrary creation. It would feel its way with a sense as subtile and secure as that with which the plant raises itself into a world of big trees and wild tornadoes, and fierce, rushing life.