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I 
 
 H( 
 
REPORT 
 
 OF THE 
 
 HON. ISRAEL T. HATCH 
 
 UPON THE 
 
 COMMERCIAL RELATIONS 
 
 OF THE 
 
 
 UNITED STATES WITH THE DOMINION OF CANADA, 
 
 N 
 
 TRANSMITTED TO THF. 
 
 HODSB OF REPRESENTATIVES BY THE SECRETARY OP THE TREASURY JANUARY 12, 1869, 
 AND REFERRED TO THE COHMIHEE ON COMMERCE. 
 
 WASHINGTON: 
 GOVERNMENT PRINTING OFFICE. 
 
 1869. 
 
L.? 
 
 i 
 
 
 i. 
 
 
 i -5 
 
 'u 
 
 
 I* 
 H 
 
 
 J^ 
 
 .('- 
 
 j: 
 
REPORT, 
 
 
 H 
 
 Washington, January V2, 1S(>}). 
 
 To tlio ITononible Iliuin McCrLLocii, 
 
 tSirri'tary of the Treasury: 
 
 _ Sill: Tlio ivsolution of iiKiiiiry passi'd by tlio IIousc of KcprosiMita- 
 
 tives, .luly 0, 18(5(», ami ivccivcd by iiii% calh'd for, first, a statonu'iit of 
 the tra<le and coiiiiiu'ico of tbi* lTnit«*d State's w itli tlu* IJritisli North 
 Aiuericau proviiiiTS, and the rcvoniu* derived therefrom since the, 
 termination of the reeiproeity treaty, and all ehanj;es in CanjMlian 
 'tiiritls since that date; second, a statement of the comparative import- 
 
 — • ance of American and C'anadian channels of commerce or transportation 
 
 i>'^ of property from tlu^ west to the seaboard. 
 
 On the (ith of May, 1S07, my report in answer to these in(piiri(>s was 
 subnutted to the House of lieju'csentatives. At that time it was 
 imimssible to reach conclusions on several important iM»ints with a satis- 
 factory dej^ree of certainty. Scarcely had one fiscal y<»ar of the Tniti'd 
 Stattis then passed since the treaty had ceased. A lar'ic am«»uiit of the 
 articles on luunl free under the tr«'aty was hunied forward from the 
 provinces as the time for its te-mination ajumtached, to avoid the 
 duties levied afterwards. A corresponding- ditiiinntioii in the importa- 
 
 ^ tions immediately subseiiuent naturally ensue<i. Ib'iice a comparison 
 
 of the trade during' the last year (►f the treaty and that next afterwards 
 
 X. would have yiehled no conclusive inferenies. 
 
 ^ With the termination of the treaty our commercial iiiten*ourse with 
 
 the provinces is ajiain open foi* investi;iation and h'^islation, or diplo- 
 
 ^ mtitie action, llenewed atteniion has been drawn to it by the etVorts of 
 
 P the Canadian authorities to remove the dissatisliu-tion of their jM'ople 
 
 ^ and pronu)te the pr(>sperity an«l consolidation of the new domini(»n l>y 
 
 restoring? the course of trade under the treaty, thu,s ^ivin}*- its natural 
 commercial connections and market t»» ea<*h provin<*e. 
 
 I mnv bey" leave to submit a further report emlmdyin;;' more recent 
 information, the result of the examination of two fiscal years, in answer 
 to the resolution of inipiiry by the House of KcjMcsi'iitatives, and in 
 pursuance of your instructions to nu' dated March I'T, I.s<).S. 
 
 TllADE BETWEEN THE I NITEl) STATES AND CANADA IJEFOKE THE 
 
 TREATY. 
 
 ^ The ]>rinciple of freedom in our commercial exchanges with the 
 
 North American IJritish i)r«>vinces has at all times received the apjuo 
 Z bation of the leading' stat<'smeii of this nation, without distinction of 
 
 ^ P'li'fy- If has become universally i>opular, an<l is <le»'i<le(ljy in iiarmony 
 
 with the national progress and enlarj»ed s\»\vit ui the ajj:e. The tenitory 
 of the ])rovinces is exten<U'd on a l>ouiu\ary indented with onr own 
 across the cjmtinent. Climate, soil and the cost of labor — the main 
 elements of value in cereal luoductions — are nearly alike in both 
 countries. These similitiules no doubt sujij^csted the idea of r«'<'iprocal 
 trade and commerce. The legislation an<l di]>lomacy of the two couiitiies 
 tinally gave it a ])ractical, though i>artial, ai»p!ication in the adoption oi' 
 the so-called reciprocity treaty. The princiide of the treaty itself was 
 to x)ermit the interchange of the iiroducts of each country fiee of duty. 
 
COMMERCIAL RELATION'S WITH CANADA. 
 
 It wa.s a formal iiiovi'iinMit in favor of virtual, if not litonil, rociimKrity; 
 presenting to the world the example of two eonti^uoUH nations ahan- 
 doninfx suspicion of injury from eaeli other, and praetiein^in their intt'r- 
 eourse the best prineiples juofessed in modern civilization. Thii 
 omissi(nis in the treaty and its limited cliaract<'r led t<» its termination. 
 
 A brief statement of our commerce with the Hritish provinces^ and 
 the n*venue derived from thou before the adoption of the treaty, an«l 
 durinj; its deca<le, is necessary to complete a i)roiK'r history of the 
 sui'cessive changes produccjl in our connnercial relatituis by its ado]>ti<ui 
 and termination. 
 
 EFFECTS OF THE TUEATV ON THE REVENUE OF THE UNITED STATES. 
 
 The treaty led to a 1ar<>'ediminutiou of our revenue upon the northern 
 frontier. In l.S.")4, the last year unatlected by the treaty, the rev<«nue 
 upon articles incl(ule<I in the Ih'e list duriu;jf subse(puMit years, and 
 im|iorted from the ]>roviuce of TauHda alone, anuntnted to more than' 
 .^l,L*4.'i,t().'}, an<l from all tlic I'ritish provinces now included in the 
 domini(Mi, was !j«l,r)l*4,4r»7. Assumiu^jf this as a basis of calculation in 
 the (jrdinary mo(h* of computin;; an increase of revenue for the live 
 siu'cceding' yeais, the revenues would have been $1),2r)7,r)<S0 in the 
 ;iooi(.nj|te, or $l,sr)l,r)17 annually. On further examination it would be 
 fouiul that the revenues would have increased in the same ratio during 
 the remaiiiin;;' years of the treaty. Ofdiial Canadian reports show 
 that in 1S,V.» the amount of duties colhM'ted by Canada on imports, thw 
 products of American imlustry from the Ignited St v\tes, was $l,S2r),l.Ti, 
 in l.s<;o !!<l,7r){>,«H>S, and iu ISOl >< 1 ,.")S4,S!H;. l)uri\vg these three years 
 tlu' whole value of property imported into this countiy from Canada, 
 upon which <luty was levied, was only, in IS.IO, $4.'U,r>.'52, in ISOO 
 $;?r)S,240, ami in l.S(H !i<227,S.V.). An ex.nuination of subsequent years 
 yields similar results. 
 
 The aveijifi'e amoiint of duty annually levied and collected on Canadian 
 imports in these three years would not exceed !$7r),(M)() annually towanls 
 defraying;' the yearly ex|>ens<'s of <'ol]ection and j^uardin^ a frontier of 
 inland coast six thousand miles in extent. 
 
 On a cl(>se examiimti(ni it would be found that a larj»e proporti<m of 
 the duty payin;;' articles im|»ortcd fiom Canada consisted of commodities 
 not produced in that country. 
 
 Total amount of flnty-prtyinj? articles 
 importod into the tjnifetl States from 
 C'unada 
 
 Iron, hardware, and salt not tlien pro- 
 duct'd in Canada 
 
 Amount of Canadian and other poods 
 charged with duties in the United 
 States 
 
 lf<:>6. 
 
 1857. 
 
 6(540, ;{7r> I |!()9I,097 
 
 1858. 
 
 1859. 
 
 503, 995 
 
 5:ji,oii 
 
 1*36, :J80 i 160,086 
 
 i!:]i:j,953 
 
 193,595 
 
 1504, 969 
 319,J)55 
 
 119,:}58 I 185,414 
 
 The i)recedinj>" statement demonstrates that during those years we bad 
 not collected aninially duties on nuK'h more than $1()(),()(K) in value of 
 merchandise actually produced in Caiuula, yielding:, on an average of 20 
 per cent., about 82r),(K)() annually. The following is a comparative state- 
 ment of the productions of each coiuitry imported into the other and 
 charged with duties in it, showing that of the i)roductions of xVraerican 
 
COMMKRCIAL RELATIONS WITH CANADA. 
 
 labor, Cansula taxed forty-five times as great an amount in value as we 
 taxe«i of lier produetious : 
 
 innfi. 
 
 ih:>7. 
 
 HoH. 
 
 Products of United SUitcs payinpdtUv in Canada. . ijT/.HI/iSJ .^({/JO:?, :{'2(» 
 ProductH (if Canada pnyitit!: duty in I'nit*"*! States. . [ I'M), ;WU , 100, Urtli 
 
 Value if American products cliarped witli duty in 
 Canada above tlie Canadian jtioducts charpcd 
 with duty in the United States 7,Ht4,!»M 
 
 !5i4,r.-'4,r>ti:{ 
 
 G,0.\[\,rM ! 4, K If), 145 
 
 Tbe records of subse(|U«'nt years conrirm the same eoiielusiou, but it is 
 not <lesira)»Ie to juesent unnecessary or reibiudant statistics, wiiicli are 
 <inly useful in )M>litica] economy to supply (>xaniplcs and illustrations (»f 
 {••enend princi|>les. They can never Im' the basis of principles uhicli are 
 ji^rounded in the nature of thin;;'s — the relation of cause to «'lfect — the 
 only safe teacher of measures wliich are best t(» adopt in every i)os.sil»le 
 case. 
 
 The United Stat<»s aud ('anada, throu<>'hout the existence of the treaty, 
 ju'esented the anonndous sp«>ctacle of two bonh-r nations, with an array 
 of custom -hotises, extending along tlu'ir whole coterminous frontiers, 
 sustained in oiw country at an expens<' gn'utly ex«eeding the revenues 
 collected through them, whih* on the ojjposite shore was found an cipialiy 
 extended c<u'don of imperial customs' buildings, collecting large revenues 
 from taxing American c«)mmodities. This result was juoducecl by suc- 
 cessive taiifl's in Canada, intlicting higher duties (in some cases abnost 
 luohibitory) upon the chief importations of the products of Ameiieau 
 lab(U\ Of nearly all the articles nanied and made tree by the treaty, a 
 surplus was (common to both countri«'s; but ('anada, then as now, had no 
 markets so i>rolitable as those of the Knifed States, and no outlet Ibr 
 her surplus at all worthy of mention. except this country, wln-re they 
 then as now contributed to the rcveniU'. Ib-i- legislation reversed the 
 ordinary course of trade, that a nation buys where it sells. Her people 
 sold to us, and were ju'evented by her tariffs from buying of us. 
 
 The nh)tives ami objects of her tariffs are not left to coiijecture. 'S\i, 
 Gait, financial minister of (.'aiiada, re[MU-ts, March 1, IstJO, page .>(». as 
 foHows : 
 
 15y extending the ad rnlorem principle to all iinitditation.';. and thendiy enroitinfrliiL'" find 
 dfvi'lopiiip tliu direct trade bftweeii Canada and all turtipn cniintiies by si-Ji. .•uhI s.i liir bt nc- 
 fiting the sliipping interests of Great Mritain — an object which is pjirrly atfiiincd tlirmi^'li the 
 duties being taken upon the value in tlie market wiicre last boufrlit — the levy u\' ".pccilic 
 duties for several years iiad ei)ni|iletely divcvtid the trade of Canada in teas, sugars. »X;c., 
 &c., to the American markets, (our Atlantic cities, ) and laid destroyed a very valuable 
 trade which formerly existed from the St. Lawrence to the lower provinces and West Indies. 
 It was believed that tlie competition of our canals and railmtid system, (via Portlainl.) 
 togetfuM" with the iinproveineiits in the navigatidu of the lower St. I.awr;'u.'>', justified the 
 belief that the supply of Canadian wants might be once more made by spa, and the benefits 
 of this connneree obtained for our own merchants and forwarders. Under this convictiou, 
 it was determined by the government to apply the principle ot ud calorem duliesj. 
 
 From the same, juige 38: 
 
 Any increase of duty wliich has been placed on EnglLsii goods is quite indemnified by the 
 dficrea.sed cost at which our canals, railways, and steamships enable them now to be deliv- 
 ered throughout the province, and if the que. tion were one of competition with Caiiadiuu 
 manufacturers, the English exporter is quite as well off as before, while as compared with 
 the American his positioa is greatly improved. 
 
6 
 
 COMMERCIAL IIELATIOXS WITH CANADA. 
 
 TRADE WITH CANADA SINC'K TIIK TRKATIKS, AND HKVENUK ^'OW 
 
 DKUIVKD TIIKIiKl'KOM. 
 
 I HOW suhiiiit ii statj'iiHMit of'tra<l«* ami roiniiM-n cof tin* Uiiit<Ml Htatt's 
 with North Aiiu'riraii Hritish in'oviiici's, and n'vmiu's derived thoiv- 
 troiii, aH furnished to nu* hy tln' <*oIhM;tors of the ditlerent districitw: 
 
 Total rahw of thitif^ V'^V^^W ""/^'"''« ^'"'<^ f.rports from tnul t<t the Jinfish 
 pnn'incfs, for thv yearn ending f/unc 3(), 18G7 and ls(js, and duties 
 nrcind. 
 
 l'nit(Mj HtateH, ports of — 
 
 Va'.uti of imports. 
 
 Chicatro ;§:«):, 7(;«) (M) 
 
 MihvHiikf.' I '^H, 1H4 (K) 
 
 Detroit 7"^(i,5iH7 (10 
 
 Dniikirk f J),H47 00 
 
 Saiidiishv '^,1»I7 0(» 
 
 ( :l.'V«l»iir(I Mi), 724 ri7 
 
 Suspj'iiKioii IJi id^'e y, 47H, •^40 00 
 
 0.swpp( 7,004, IW 2H 
 
 Oudi'tishurp 1, I7I,4-J4 00 
 
 Cape ViiKM^iit 70:5, ir.O 00 
 
 liostoii* a, »»r>7, '-ilS (10 
 
 N«\v York I 1>H(), IKJ:{ 00 
 
 Erie I 70,*J0() 00 
 
 Portland t 2, 1*^^, •240 00 
 
 Grand Haven j 'Mi 7.') 
 
 Pembina 100,1^0 00 
 
 Plattshurg I 1,S>HI,5H7 00 
 
 Toledo ' '.>:<:), r.iH no 
 
 Rochester ' 7:{0,7(»4 00 
 
 ButlaU. ■ ;{, ;rr7, -247 00 
 
 Port Huron I,4:{:{ !•> 
 
 Burliii srton 2, :ioo, 47r> 00 
 
 Totalt 2r),yi8,:io0 72 
 
 Value of exports. 
 
 Duties rt'eeived 
 in gold. 
 
 I, ioi,ir>:t 
 i,«ir)i,2r,i» 
 
 :{,2U», 
 
 'm:\, i>:{7 
 
 !t7,2ir) 
 
 1,07S»,:<2(» 
 
 27l>, WC, 
 
 .->:{, o:{7 
 :{,oii,Hi-i 
 :{,r)i7, 14:; 
 
 J1>U,(W() 
 2, 352, n2o 
 
 00 
 00 
 00 
 
 00 
 00 
 (»0 
 00 
 00 
 00 
 00 
 00 
 00 
 00 
 
 :{»i2,4r.H 00 
 r)i:{.:}2(5 oo 
 
 JH(»,ltr>4 00 
 
 14;»,0:J(» 00 
 
 :WH,7S)2 00 
 
 1,21>H, |H<) 00 
 
 4,(544,1100 00 
 
 ;?14H, 
 
 7, 
 
 140, 
 
 2, 
 
 I, 
 
 ior>, 
 :{24, 
 
 l,lvi7, 
 212, 
 
 Hi, 
 
 315, 
 
 J«. 
 
 151), 
 
 IG, 
 
 376, 
 
 33, 
 
 130, 
 
 553, 
 
 45, 
 
 470, 
 
 748 
 1)79 
 250 
 (IOH 
 443 
 H-JH 
 34H 
 
 % 
 1)9 
 74 
 
 m 
 
 (53 
 57 
 61 
 
 545 (55 
 
 051 (54 
 
 036 57 
 
 5(57 00 
 
 4HI 
 
 :{53 
 
 H20 
 
 IOH 
 
 1H() 
 
 H89 
 
 706 
 
 195 
 
 (579 
 
 7;«5 
 
 907 
 
 0(» 
 00 
 (59 
 71 
 00 
 43 
 00 
 41 
 00 
 2« 
 00 
 
 21,848,074 00 
 
 5. 144, 1(J6 25 
 
 • Sonic of the e.ollct torn iiii-lndi'd free goods iu their roturui"; carefully rxcliullng Mji-hc, the actnul duty- 
 p:iyiii); iinport.s were .*'.'2,'.U!»,.'j:i!(. ^ 
 
 t KMtliniitcd. 
 
 Of the tiscal year l<S07-'fi8 it has not been deemed iieeeasary to give 
 
 the details. The foUowinj; are its aggregate results: 
 
 Value «)f duty-pa>i!i<r imports $24, 226, 683 00 
 
 Exports 20, 343, 507 00 
 
 Dutie.s received in gold 5,400,000 00 
 
 Tln' following" is a ciMidensed view of the eonnneree of Canada with 
 all nations, exhibiting the value of her exports to and iiiii>orts from Great 
 lliitain, her eolonies, and foreign I'ountries, including the United States, 
 for the tiseal year ended June .'>(>, one year before and cme year after tlui 
 termination of the re(;ij)roeity treaty. The tables are eoj)ied from the 
 (►tiicial returns of Canada. The intermediate year of 18({<> is omitted, 
 the year when tlu' treaty ended. It was exceptional in its character, being 
 large quantities of different articles having beeu imported into the United 
 
COMMERCIAL RELATIONS WITH CANADA. 7 
 
 SUit«H in aiitiei|>ati(>n of the additional |>i'ic('! realiztMl for tliein wlii>n 
 the (lutioH on Canadian prodncts were again enforced : 
 
 Countries. 
 
 Value of 
 exports. 
 
 1865— Great Britain 
 
 North American colonies . 
 
 British West Indies 
 
 United States of America 
 Other foreign countries . . . 
 
 Total 
 
 l.(H}5,0r>7 
 
 4i,:n:t 
 8:v», 8r)(» 
 
 Value of 
 imports. 
 
 42,4Hl,ir>l 
 
 f)II.57» 
 
 2(»9, :wi> 
 •i;j,r^9,05r) 
 
 :J, 274. 644 
 
 :{H, 020, 469 
 
 * Excluilve of itpeciu or free good*. 
 
 The following tables show the trade of the dominion of (^anada with 
 the United States and other conn tries for 1<S(»7, the tirst year after, and 
 nnatfect*Hl by, the termination of the ti'eaty : 
 
 Summary statement of the value of imports, duty collected, 8fc., in Ontario and Quebec during 
 
 the fiscal year ending June :iO, 1867. 
 
 
 o' 
 
 a 
 
 > 
 
 
 FKOM WHAT COUNTRY 
 
 IMPORTED. 
 
 
 
 Imports. 
 
 1 
 
 British colonies of 
 North America. 
 
 British colonies of 
 West Indies. 
 
 United States. 
 
 1 
 
 a 
 i 
 & 
 1 
 
 Amount of duty. 
 
 Dntiable goods . . 
 
 Free goodi 
 
 Coin and bullion. 
 
 $35,'752,744 
 16, 680, 926 
 
 $26,227,818 
 7 h:i3 l.'il 
 
 $:)88, 673 
 719, 700 
 
 $130,264 
 7,5;»8 
 
 $6,060,013 
 7,997, 137 
 6,211,752 
 
 2,005 
 
 |2, !Mr), 976 
 
 323. 4(H) 
 
 20 
 
 $7, 001. 660 77 
 
 6,411,312 'laa'.'VlO 
 
 
 Foreign reprintH 
 of British copy- 
 right works 
 
 4,005 
 
 
 
 
 
 
 
 
 
 
 Total 
 
 59, 048, 987 , :J4, 260, 509 
 
 1, 108, 373 
 
 137, 802 
 
 20, S72, 907 
 
 3, 869, 396 
 
 7,001,660 77 
 
 Summary statement of value of exports from Ontario and Quebec, articles of Canadian produce, 
 
 during the fiscal year ending June 'M), 1867. 
 
 Exports. 
 
 Produce of the mineB , 
 
 Produce of the fisheries 
 
 I'roduce of the forest 
 
 Animals and their products 
 
 Agricultural products 
 
 Manufactures 
 
 Coin and bullion 
 
 Other articles , 
 
 Ships built at Quebec 
 
 Goods not the produce of Cauada 
 
 •a 
 
 > 
 
 o 
 
 1541, 
 
 784, 
 
 13, 948, 
 
 6,118, 
 
 16. 7ti5, 
 
 89.-,, 
 
 2,916, 
 
 416, 
 
 1,00.-), 
 
 1,678, 
 
 234 
 636 
 
 Mi< 
 6.39 
 981 
 767 
 
 o:i4 
 
 121 
 076 
 083 
 
 C 
 
 '£< 
 
 u 
 
 aa 
 
 a 
 
 9) 
 
 B 
 
 e 
 
 $301, 
 113, 
 
 6, 889, 
 
 2. 125. 
 
 2, 770. 
 
 li-ti, 
 
 511, 
 
 48. 
 
 818, 
 
 1, 196, 
 
 105 ' 
 
 936 
 
 7,-3 
 
 271 
 
 yi»3 
 
 •^m ' 
 
 6.V) (. 
 
 878 
 440 I. 
 948 ' 
 
 $6,722 
 113,7.')8 
 
 31.011 
 
 2*-'9, 026 
 
 , "ITfi, (K)8 
 
 183, 177 
 
 1$ 1 6, 860 
 
 ' 3, 408 
 
 ' .3, 967 
 
 8, 983 
 
 20, ,V.»7 
 
 18, 887 
 i 30,' 6(18' 
 
 $333, 
 
 115, 
 
 6,831, 
 
 3. 686, 
 
 11,185, 
 
 459, 
 
 2. 404, 
 
 347, 
 
 327 
 767 
 252 
 191 
 227 
 .391 
 ■M*4 
 929 
 
 a 
 s 
 o 
 
 « 
 
 320,332 
 
 Total value of exports 45, 070, 219 14, 962, 5(M ; 3, 549, 197 ' 53, 815 : 25, 583, 800 
 
 o 
 
 $80 
 
 424,315 
 
 193, 194 
 
 14,184 
 
 25, 470 
 
 46, 402 
 
 427 
 
 ]86,63<i 
 
 30, 195 
 
 920,903 
 
8 
 
 COMMKKCIAL UKLATIONS WITH CANADA. 
 
 I I 
 
 Tli4> niiiiii fiMitiiroN of t1i<> tnKic of t)M> (loniiiiioii of CiiiuHla is itb the 
 lTnit<Ml Stat<'s and (iiiMit Jiritaiii throiif>:ii a HriicN of ycaiH air i'orrcctly 
 (^xprcNscd in the above tabh'H, wliirli arc not ahva.VH accurate in dctaiU. 
 The ehan);<'N in tlicni from year to year wliich they nuiy exhihit will he 
 found to exist in these tluctuationsin trade produced hy the hiwnof supply 
 and (h'niand. Ant'xaniinationof the aliove ( -anadian returns sh<»\vs that 
 the coninicii-e between the two countries has not Ihm'Ii materially dis- 
 turbed by the termination (tf th(> reciprocity treaty, although the United 
 States have rec«'ived a lai^<' addition to their revenue from tin* <lutics 
 paid into our treasury on Canadian productions. It discloses the addi- 
 tional fact that the Canadians n«>w, as in tinu's past, sell to us an<l buy 
 of Great Itritain. Tin* contrast between '^'rt^iHHi, (he amount of reveniu^ 
 annually received by the United States from Canadian imports during; 
 the operation of tlu' treaty, and tin* lar^e amount rec<'ivcd sine*' its ter- 
 mination, will occur t«> every one. It will also be remembered that the 
 duties exhibited in the revenue tables already ^iven are in ^'old. Com- 
 put4'd in our currency they exceed >!J7,(MM>,(KM>, annually. It is a si;;iiili- 
 eant and important consideration that, during the whole existence of the 
 treaty, a period of 10 years, the United States colh'<'tc<l ^i'MMMK), while 
 in the two fiscal years I'lapsed since its termination, instead of .'!^7r»(),0(M>, 
 we have coIhMted aluait !5<14,0(I(>,0(K), in our own currency. While our 
 revenue has been thus increased tluMc has been no loss of traih'. 
 
 In a previous rcptut it was shown that, for a larp- proportion of her 
 productions, Cana<la is |)lac<'d in the position of a i'armcr who has only 
 one custouM'r. llciu'c tlie value «>f our markets has always Iummi hijihly 
 appreciated by the Canadians. Their parlianuMit has not lM>sitatcd to 
 call attention to the ^rcat ditfcrciKc in price of the same articles in the 
 two ('ountries; and the practical test of tln' whoh* (pu'stion is shown by 
 the very lar^c inip(»rtations made fr<»m Canada into this country, even 
 now when hij^h duties ar(> |>aid on them. Nine tenths of the Cana<lian 
 exports to the United Stat«'s consist of products of the foicst, animals 
 and their products, and the juoducts of tlie farm. They do not sensibly 
 atfect our markets, an<l are less in value than those of any agricultural 
 State in the west. They have no nM)rc p('rceptil>le elfcct on our markets 
 than the waters of a stream c(")llecte<l from a small surface have upon oiu' 
 of (uir iidaiid seas. 
 
 In fact, the daily prices current at Montreal aiul Toronto, each the com- 
 mercial nu'tropolis of its pi'ovince, and the index to the prices throu<;h- 
 out the whole "dominiim," an* j;overiM'd entirely by the market priiu'S 
 in the United States, exchan«;(', duty, freight, and expenses bein^i added. 
 This is shown by the daily commercial reporls in Canada. T!u' view thus 
 taken is contirmed by the collectors of customs at all tin* leading' jMU'ts 
 on the northern frontier, as will In* seen by extracts from their report^to 
 me, pven in the appendix hereto, (see A.) 
 
 The com|>arative maj;nitu<le of the flour ami pain trade of New York 
 and Montreal — each the commercial centre of its own country — is shown 
 by the followiu}; tables, comi)iIed by KInuue II. Walker, a j^entleman who 
 has rendered great services to the public by ditt'using much valuable 
 stifctistical infonnation as to our iidaud commerce. 
 
COMMKUCIAL UKLATION8 WITH CANADA. 
 
 9 
 
 til the 
 rn'C'tly 
 IctailH. 
 will be 
 supply 
 iVH that 
 llv <Uh- 
 Uiiitrd 
 duties 
 <• a(l<li- 
 U(l buy 
 
 I'Vi'IlUr 
 
 (luring 
 its tt'i- 
 hat the 
 Coni- 
 si;;iiiti- 
 i' of tlu' 
 ), while 
 
 hilt' our 
 
 1 of her 
 las only 
 I highly 
 tatcd t«> 
 s iu the 
 lown by 
 ly, even 
 aiuuliau 
 auiiiials 
 sensibly 
 cultural 
 uiaikets 
 I poll (Mie 
 
 TahlcM ttliowinff the nriipfn ami cvftortH of flour and (ji'ttin at \iiv York und 
 Montrciil for tUrcn monthn of the luntfo ur ifatrn. 
 
 HVAIAVIH. 
 
 ih4;h. 
 
 leer. 
 
 lH(ki. 
 
 m\C}. 
 
 V 
 
 Idur. 
 
 )blH. 
 
 '^,Mi,V.r7 •,', JtUt, «7(> 2.HM,li7!»' i>, •^•JH, :jy;j 
 
 Whoiit bun, 
 
 ( 'oru litiN . 
 
 ( iHtM hllH . 
 
 Hfirlny Imih . 
 
 liyi' huM . 
 
 I'UHS bu8 . 
 
 f.'.Tdo, liw I !». 41'', i»74 :j,:.4i?,hmi 7.hu),:M7 
 
 I-, (w-.'.tuH l4,i;iHl,-J(;(( •Jil.lWt, s.Vj , I4.7!I4.44(» 
 
 iMMi:»,;ii(; 7,KMi,rMi 7. (■.-".», :i.v,i '.•,(i:.(;.7ini 
 
 •,', 7 III. :i.M tj, :.:»-', 7: ft' 4,'':i-J.7ttt; - y/.MM, ('*)(» 
 
 7r.t». Ill', i 7i.',t;7- I , •• I"", <'.7r. ' r.77,r.u:» 
 
 :<r.H,4iii ! rM.'.,:!-'. 4iN;,r.H-j ' iiu.riH*; 
 
 Totnl IxihIiuIh 45, 157, .'m*^ :(;'>, H71I, X) 4\),'Jri,\,0b6 [ Xi, ad:i, 7'^G 
 
 KxrouTy. 
 
 Flour bbl«. 
 
 Wlicat b\iH. 
 
 Colli bim . 
 
 OhIs buH. 
 
 Barley bun . 
 
 IWH. 
 
 914,730 
 
 ."., HI,' mo 
 
 r., 7 •.>:{,:«».'. 
 
 Hi.7-^:{ 
 
 l«n7. 
 
 iKf,r.. 
 
 iHr.5. 
 
 Hai,:W2 ! 849,297 ' 1,270,110 
 
 I'ea.s . 
 
 b 
 
 Total busliols 
 
 bus. 
 
 I.'.:{,(il>:{ 
 
 4, ll»(!, \-S.\ 
 
 7,;<l(», 40'.l 
 
 1IH,:;4;'. 
 
 4ir,'.i'.i.'. 
 r.(ti,4i'i 
 
 :hi>, (id.". 
 
 Ki.Hic, :i(ii 
 
 1, i(>:{, li.-M 
 
 yii,'j:u 
 l(H,i»7:? 
 
 •J. Oil I, l-r. 
 
 :<, 4H(»,oi:» 
 
 70. .-*h; 
 
 i:o,'('ii»4 
 
 74.0411 
 
 ii,(;i'.>,(W i:t,.'.:{i, 147 i;{,4!ij,ijr> .'.,-.-'(>, 0117 
 
 RKCAIMTI I-ATION. 
 
 the eoni- 
 thi'oujih- 
 I't piiees 
 <i added, 
 iew thus 
 uj»- p(UtS 
 eportai to 
 
 i'w Yolk 
 is shown 
 man who 
 valuable 
 
 Year. 
 
 Reccipt.s. 
 
 Flour. 
 
 Grain. 
 
 \m^ W,(i(;4.407 4;'., l.'.7.r..V.' 
 
 1W)7 'J. 400. 47»i :{;., H71I, r.H»; 
 
 IHIM) 2,4!M,1)7!> 40, -i-^:}. OnH 
 
 160.") 3, -iHH, ;{o;{ :r.,:K{,72'> 
 
 Exports 
 
 Flour. 
 
 tturrelf. 
 H44,7:{(» 
 H'.j|,:t(i2 
 H40, .>07 
 
 i,'.i7o, no 
 
 Grain. 
 
 liushrh. 
 
 II,0|0,02H 
 
 i:j,r.:u, I47 
 
 |:{,41M, 145 
 
 5, nm, 007 
 
10 
 
 COMMERCIAL RELATIONS WITH CANADA. 
 
 1 1 
 
 TIh' followiuji" will show the receipts of flour and grain at Montreal, 
 by rail, river, and eanal, from January 1 to December i, 18G8, and exports 
 for the same period, compared with corresponding period in 1807 : 
 
 Flour bbls . . 
 
 Wheat bus.. 
 
 Corn bus.. 
 
 Oats bus . . 
 
 Barlfy bus . . 
 
 Rye bus . . 
 
 Peas bus.. 
 
 Receipts. 
 
 74H, :W3 
 
 Receipts. 
 Id07. 
 
 Exports. 
 18«S. 
 
 662, 400 
 
 503, 946 
 
 Exports. 
 1867. 
 
 200, 369 
 
 2, 406, 2:W 
 
 1,061,8IU 
 
 125,802 
 
 102, 195 
 
 2, 71>7 
 
 512, 778 
 
 2,798,2.55 
 
 1,123,717 
 
 891,605 
 
 735, 047 
 
 280,.5(»7 
 
 856, 192 
 
 127,421 
 
 458,915 
 
 128,7()5 
 
 6 
 
 1,298,106 
 
 642, 974 
 
 1,446,637 
 
 643, .528 
 
 898, 000 
 
 166,038 
 
 21,916 
 
 1,741,, 558 
 
 Total bushels I 4,211, 623 
 
 5, 524, 659 
 
 3,816,851 
 
 4,917,679 
 
 The essential and unehangeabh*. eharacteristies of this trade are 
 beyond the intlueiiees of temporary legislation on either si<le, and must 
 be gijvenied by those leading faets as to geograidiy, climate, and con- 
 flgnrati<>n of the <'ontinent, which were more particularly set forth in a 
 previous i-eport already subn^'tted to Congress. 
 
 The views then "\pressed have since been confirmed by the unsuc- 
 cessful ellorts of tin' Canadians to negotiate treaties of comm<'rce in a 
 southward direction with Cuba, the \Vest Indies, Mexico, JJrazil, as well 
 as other countries in South Ameru'a, and to extend their trade with 
 India aiul China. The distance to Cuba from Montreal, by way of ^he 
 St. Lawrence, is at least three tinu's as great as through the United 
 States. 
 
 THE RIVAL CARRYINCt SYSTEMS. 
 
 To understand the influence of our resj)e(^tive geogTaphical i)ositions 
 ii])on the commercial intercourse between the United States and the 
 "Domiiiiou of Canada," it should be known that Port Colborne, on 
 Lake Erie, in the ju'ovince now called Ontario, is the entrance to tin' 
 AVellaiid canal, an<l thence, through Lake Ontario, to the St. Lawrence 
 (;anals. Butl'alo, in the United States, and oi)i)osite Port Colborne, is 
 the entrance to the Erie canal, leading through our own territory, and 
 via the Hudson river, to our seaboard. 
 
 All western commerce occui>ies precisely the same status to these 
 important i)oints, whence diverge the two lines of water c<mimunication, 
 fretpiently reganh'd as the great rival routes for the trade of the north- 
 west. A glance at the maj) will confirm this fact. The i)roi>osed Niagara 
 ship canal is on the A'nerican side, and parallel to the Welland canal, 
 ami if constructed, and of any commercial utility, must form the Ameri- 
 can link in the St. LaAvrence canals through Canada. 
 
 The following is a staiement of the rehitive distances, via the St. 
 Lawrence canals and the Erie canal, to New York and Jioston, the two 
 chief northern i>orts of the United States — the saving of distance in 
 sending to New York being an ecpial saving to all the more southern 
 and Atlantic ]K)rts: 
 
 Miles. 
 
 ])istance from Port Colborne to Montreal 500 
 
 Distance from Montreal, through river and Gulf of St. Law- 
 rence, to track of commerce in the Atlantic 1, 000 
 
 i 
 
COMMERCIAL RELATIONS WITH CANADA. 
 
 11 
 
 IS 
 
 Miles. 
 500 
 
 1,000 
 
 Mile.s. 
 
 Distance from Tort Colbonie, ria St. Lawrence canals, to 
 
 Boston 2, 500 
 
 Distance from Port (N>lborne, ri<( St. Lawrence canj'.ls, to New 
 
 York ;5, 000 
 
 Distance from IJntfalo, rIa Erie canal an<l IluWson river, to 
 
 onr seaboard 500 
 
 During' the six months when the St. Lawrence ronte is oj>en, it is 
 sehlom sale, owinj*' to stnni^' currents, immens(> masses of ice, and fo<is 
 almost i>er])etnal, tin' latter beinj;' (paused by the meetin^i; of the tropical 
 waters with those l»r«)U^ht down from tin* polar seas. 
 
 Tlu'se <i(M)j;rai>hical facts must determine, through all time, the 
 sui>remacy of our markets and our cariyin^' systenjs for the inland 
 (M)mmerce of North Anieri<'a. uVdverse lejiislation by onr foici^ii neijih- 
 bors may, for a time, deflect ])ortions of our iidand and foreign com- 
 merce from the natural chamu'ls of in^^ress and e<;Tess to and from our 
 Atlantic cities, but only to re-act to the h)ss of those who have the 
 temerity to try the experiment. 
 
 We liave seen by the tables already j)resent('d, that only a small ju-o- 
 portion of the j^Tain carried to Xew York is <*xi>(U'ted abroad. Of these 
 exports a larjic share is sent to the \Vest Indies and other southern 
 countries. As the nuite throujih our Atlantic ports to the ;;reat ^rain- 
 consuminji' ami manufacturinj^' re<iions of our eastern States, as well as 
 to the foHMfiii and domestic markets south of Xew Y'^ork, and supjdied 
 with j>Tain and Hour from the United States, is much shorter thi'ouj;h 
 our own country than rin the St. Lawrence, the vabu' of the Knjilish 
 j>rain nmrket is wiuthy of investi«;ation, althou,iih, even for this, the route 
 thr<my:h the United States has suju'rior advantaj>"es. 
 
 fOMl'AlJATIVE IMPORTANCE OF THE EN(JLISII (JK'AIN MARKET. 
 
 The importance of Enf>land as a nnirt for <;rain in'oduce<l on this con- 
 tinent is ^iTcatly overrated. In 1S4S the "corn laws" were repeah'd. 
 Our farmers confidently expected that a lar<;e market would b«' <»pened 
 foi- their ji'iain. But the imjxutations into (Ireat IJritain du .in^^ the 
 12 vcars subseijuent to the repeal were live times as lar^c as those from 
 the Uuited Stat<'s within that ]»eriod. Our home market had increased 
 so nuu'h that our exiuuts of breadstulfs to Kn;iland had (h'creased at 
 least 27.^ per cent, in proi>ortion to <nir pojyulation. Milwaukee and 
 (.'hicaji'o ahme often send off in 1() <lays more ^raiii and Hoar than Eng- 
 land takes from us in a year, reckonin;;' tl'.e average of the last 20 years. 
 These statements are not based ui)on the tlata of isolated seasons. The 
 position of the wheat-] uoducinj;" poitions of the liritish possessions on 
 this continent makes New York, for them, as well as for the United 
 States, the peat northern <-ontinental (h'i>ot for shipping, wlu'nce h»w 
 fn'iuhts, arisin<4" from brisk comjjetition, are found, to which return 
 carjioes can be had, and whence, throu<;hout the whole year, the mer- 
 <'hant can transmit produce either to Old England. New ICn^land, or 
 southern markets — thus preseiitinj;' to the western farmer ami shipper 
 great advantages over Montreal. 
 
 THE AGGRESSIVE POLICY OP CANADA. 
 
 Canada has, during the last quarter of a century, expended $1 'iS.2;i5,413 
 in the eonstruction of unprofitable railways and canals, with no local 
 traffic, population, or commercial wants commensurate with such stu- 
 pendous undertakings, but relying upon tln' diversions of our inland 
 coiumerce to sustain them. The motives of her policy are almost as well 
 
12 
 
 COMMERCIAL RELATIONS WITH CANADA. 
 
 kiH»wii as tin' works she lius ((Uistnu'tcd. Tho Hon. A. T. Clalt, the 
 Caiiallisin minister of tiiiaiKte, in a late sptMM'li, oii behfilf of tlie govern- 
 ment, said: 
 
 We liHve ii(» tmdo ourselves wliicli would requiro enlarpemptit of the caimls; no trade 
 which would justify us in oulargiuf; them; we could only hf repaid for such iinprovementa 
 by obtaiiiiiip the Auiericau States' trade and making: it pay tolls or otherwise contribute to 
 our revenue. 
 
 H(»w far our t5'<>vernnH'ut will be willinj*' to surrender its trade and 
 revenues as a tril>ute to this policy <»f a jjij^antie British-Canadiau rivalry, 
 will (h'pend ui»on the rliara<;ter of American statesmanship. 
 
 CANADIA>i TAltlFFS — TIIJOIK IM'LIl^NCE f)N I'MTED STATES RAILllOADS, 
 
 >!lIll»l»IN{r, ETC., ETC. 
 
 A statement of the clianjics in the Canadian taritf, since Jidy (I, 18f>r>, 
 as retpiired by the resolutions of the House of Kei>reseutatives, will be 
 found in tlie apju'tidix hereto, (see I>.) 
 
 It will be seen that r;ina<la, with a view to exportation and the <Ienmnds 
 of the maritime pro\ iiMcs, now admits wlieat and tlour free of duty. She 
 lias uo crop so cheaj* and piolitable, for various manufacturing ami other 
 jMU'poses, lis corn bought from us. It is a domestic ue<'essity Avith her 
 to i)urchas(' it, iis slic cannot [>roduce it so cheaply as she can buy it, 
 and any duty levied by lier ui>on wheat an<l corn, our two staple articles 
 of agriculture, nnist be i)aid by Imm- peoj)le. Owing to the g<'ological 
 formation and tlie p( <itioii of tlu' most populous and rapidly-increasing 
 ]>ortiou of Cauiida, she will always be comiK'lled to carry her coal from 
 distant mines, chii Hy tVcan tlie rnit<'d States, her own consumers pay- 
 ing whatever duties may be imijosed on it. 
 
 A chai'iicteristic feature of the Canadian tariff's is, that iilthough the 
 usual rate of duty levied on textile fabrics and otlu'r mamifactures is 
 15 per cent., the mntrrials used in uiiinufacti. ring are car<'ftdly exempt<'d 
 from taxation. Many articles alresidy in part manufactured are also 
 iiiclmled in the exemi)tions for this jnirpose. This coiu-se is carried to the 
 fullest extent in reference to shipbuilding, all articles used either in 
 building or furnishing a ship being imported free of sill duty. 
 
 A similar i)olicy exists as to railroad iron in all its forms, to locomo- 
 tives, and engine frnmes, and to everything used in the constructing of 
 railways. To so great an extent are tacilities for shipbuilding carried 
 out, that siM'h a vessel as would cost jibout >«1(H) a ton in the seaports of 
 the United States can be made for little more than half that sum in the 
 p<U'ts of the provinces, estimating in the currency of the United States. 
 The intliu'nce of this great advantage in faviu' of provincial shipping and 
 foreign industry over those of our own c(uintry, both in competiticm for 
 inland commerce on the lakes and rivers, and for trade carried on 
 between the two countries on the coast, and with all regions beyond the 
 sea, deserves grave attention ; jtnd the concessions made in the sanu' way 
 to provincial lines of railroads, also c()mj>eting with our own, are scarcely 
 less worthy of consideration. The coasting trade of the British provinces 
 has nev<'r been conceded to the vessels of the United States. Foreign 
 shi[>s nught go from one colony to another, but even this linuted prvvi- 
 lege is now taken away by the confederation of the British Novth 
 Ameriean provinces. The imperial act 10 and 17 Victoria, chapter '.07, 
 section 163, is as follows: 
 
 ''No goods or passengers shall be carried from one part of the British 
 possessions in Asia, Africa or America, to any other part of the same 
 possessions, ejcct^t in British akips.^ 
 
I alt, the 
 <]j<)Vt*rii- 
 
 . ; no trade 
 (Fovements 
 iitribute to 
 
 ■ade and 
 I rivalry, 
 
 [LllOADS, 
 
 • (), isoo, 
 s, will be 
 
 demands 
 ity. She 
 uid other 
 with her 
 u buy it, 
 \v artieles 
 »«'()logieal 
 ncreasinj^' 
 coal from 
 mcrs pay- 
 
 iou.uh the 
 aetures is 
 exempted 
 1 are also 
 ried to the 
 either iu 
 
 to loeomo- 
 rueting of 
 lis;- earried 
 ■;ea])orts of 
 Slim in the 
 ed States, 
 ipjdug and 
 )etiti(m for 
 earried on 
 t)eyond the 
 ' same way 
 re scarcely 
 I provinces 
 i. Foreign 
 lited privi- 
 tish Novth 
 hapter ;07, 
 
 the British 
 ►f the same 
 
 I 
 
 COMMERCIAL RELATIONS WITH CANADA. 
 
 13 
 
 Some yeara ago, in my report to Congress, referring to the suc(;essive 
 and successfnl legislative ertorts of Caiuula to divert and control our 
 commerce, the origin of this evil and the injury to our industrial interests 
 were ])ointed out as follows: 
 
 "In the profits accruing from freight between the two countries, the 
 advantage, since tlie treaty, has been in favor i)f British shi[)piiig, the 
 value of exports and imports ]»y the vesselsof each country being regarded 
 as the test. In the live years ending June .'»(), isr)t, the value of <h>mestie 
 exports to Canada in British bottoms was 61-,'V.)r>,.sl(;, and in Anu'rican 
 bottoms $lG,5t).'>,.Sl(), the ju-eponderance iu our favor being about one- 
 third; whilst in the five years since the treaty, and beginning with July 1, 
 1854, there was an excess against us of nearly one-half, the value being 
 $20,; j; JO, 720 in American vessels, against 8'i'S'*42,«»riL' in vessels of British 
 nationality. No marked inequality exists iu the imi)orts of the ITriited 
 Stati s by the shipping of both countries, tlie vahu' <arried by them 
 respectively, $37,22;J,00r> in American, and 8.'{<!,r)2S,<K5S in foreign vessels. 
 
 "In this competition of shipi>ing, ^Vnierican ship-owners ran a race iu 
 fetters. The staple nuuiufacture of Canada has long been tiiat of ship- 
 building for exi>ortation. A cljcap and abundant snpply of labor tor 
 this purpose is obtained at (Quebec dining the long winter suspension of 
 navigation; and the value of sliijts built there tor sale in foreign mar- 
 kets exceeds by many times that of all other maiuifactured exports of 
 Canada. This branch of industry is encouraged by admitting all the 
 materials used in the construction, rigging, or equipnu'iit of ships, 
 either at a nominal rate of duty or entirely tree, or subject to a return 
 of duty to the ship-builder when satisfactory proof is given that they 
 have been used for this j)urpose. "' 
 
 The evil here exhibited has now grown into vast proi)ortions, and is 
 aggravated by the burdens of our own legislation. It is becoming as 
 disastrous to our foreign commerce as the aimed ships of (Ireat Britain 
 under r<'bel Hags were to (mr nu'rehant marine (hiring thelat<' rebellioii. 
 Heretofore^ the vship-owners of Hnglainl and other connnercial nations 
 bouglit our vessels, which were seen «>n every sea, and sailed undiT the 
 tlag of every mitiou. The i»ractical conseipuMices of our h'gislatiou are 
 well stated in the following "Address of the Shii» builders and Ship- 
 owiuMs' Association of .Maine:" 
 
 "It has been intimated, an<l the proposition has been seriously enter- 
 tained iu high and intluential i)hu'es, to repeal our navigation laws and 
 admit all foreign-built ships to American registry! Is not this a sutti- 
 cient inducenuMit to bestir ourselves, and at oimc lay before Coiigicss th(^ 
 reasons why that should not be done ' Sluuild we not show tlu'm that 
 this will be a great initional disaster, and more ruinous to onc^ of its 
 members than the hurricanes and eartlM|uakes which have of late so 
 severely atllicted other regions. The Philistines, with a view to keep 
 the Jews in perfect subjection to them, took away their artisans, so that 
 'there was no smith found throughout all the land of Israel.' And were 
 they not wise? What more perfect device could be employed to keep a 
 peoi)le in subjectionthan to take fr(»ni them their skilful workmen '! And is 
 not thisjust what this ju-oposit ion a mounts to' < )ui' shipwrights would be 
 diawn away to the new British (h)minion, and all their skill emi>loycd 
 to add to the wealth and arrogance of that power which has intlicted 
 ui)on us such deadly injury. Is the Ameri<'an nation willing to aggran- 
 <lize that power to the ruin of itself, and present to the Wiuhlthe humili- 
 ating s])ectacle of relying on other nations for its ships, while it i>ossesses 
 more alunidant means for their construction than any other nation what- 
 ever, and might, but for its own unwise legishition, be the great source 
 
14 
 
 COMMERCIAL RELATIONS WITH CANADA. 
 
 of supply to all nations ? Wore this policy cairied ont, tlio iinniediato 
 effect would be the eontinue<l silence of our shijj-yards, the transfer of 
 our shipwrights to foreign countries." 
 
 What is true of ]Maine can he well said by the people of evers' frontier 
 State upon our 0,0(M) miles of river and lake (roast, especially if (,'ongress 
 should repeal "our navigation laws and admit foreign vessels to Amer- 
 i<*an registry." 
 
 Our lake marine and our railways now have to compete with British- 
 Canadian carrying systems, constructed at half the cost of their American 
 rivals. Admit Canadian vessels to r<'gistry and the asserted ownership 
 will be nominal. Their admission will b<» e(iuivalent to the repeal of the 
 navigati<ni laws, ])ermitting foreign vessels to coast or carry goods from 
 one port in the United States to another, as Canadian railways are 
 allowed to transport from one inland }>ort in the United States to another, 
 under a very liberal authority, it w(nd<l then be said everywhere on 
 our inland shores, as it is now said in Maine, that "our ship-yards are 
 idle, and grass has grown where formerly was the busiest tread of our 
 workmen." 
 
 Already, estimated by tonnnge, the American vessels employed on the 
 ocean have been reduced from 1S()1 to 1S<>7 more tlian one-half. Few, 
 perhaps, ad(Mpmtely a]>])reciate the value of our inland shijjping, cr an^ 
 cognizant of the fact that its tonnage now exceeds, or is considerably 
 nunc than double that of the shipping emj>loyed in foreign trade. If the 
 coasting trade slnmld be thrown open to JJritish-Canaclian rivalry, the 
 inland shipping, the last remaining object of honorable jn'ide to our 
 navigation, would soon be driven from our inland seas, through the 
 methods which have jdready reduced our ocean-going vessels to less 
 than one half of their former number, and continue t(> diminish them.* 
 
 Duly by adopting the principle of exempting fnnn duty, or allowing a 
 drawback uiK)n all articles used in the construction of shijjs, can our 
 fornu'r naval i>r(»si)erity be restored. Tlie same principles should also 
 be extended to all our nu'ans of iidand transit. By this ccmrse trans- 
 portation of our great staple jjroducts would be chea])ened, and our 
 exjun-ts be enablcil better to conii)et(' in foreign markets, thus aiding 
 materially in turning the actual balance of trade in our favor. 
 
 The whole modern scheme of British-Canadian internal imiu'ovements, 
 with their ingeniously-contrived tariffs, originated in a perversion of the 
 freedom conceded to the trade a;.d conunerce between the two countries, 
 by the adoi)tion of the reciprocity treaty. Without such coiu^essions 
 British capital never would have found investment in the immense pub- 
 lic works of Canada ; nor could those rival carrying systems to-day tind 
 any important support, except upon the basis of our bonded system, the 
 warehousing act of 18r)4, and the most liberal construction of the act of 
 
 'The distinguished commercial representative from the city of New York, in his speech, 
 in internati' "onventiou at Portland, said, "That the inland conunerce of a country is 
 vastly nior taut to that ctuiutry tlian its foreign coiunierce. The very element of pros- 
 
 perity in f( ,., commerce is domestic conunerce. (Applause.) The commerce which sails 
 upon your lakes — Ontario, Erie, Superior, Michijran — and which sails upon yttur canals, is iu 
 value four times that of the couniierce which is borne iu ships from the seaports of this coun- 
 try to tlie old world " (Applause.) 
 
 Mr. Niuuno, chief of the tonnap^e division of the T^reasury Department, estimates that, the 
 inland conunerce of the United States is about seven timns as preat as the commerce l)etweea 
 the United States and foreign countries (other than the British Possessions of Nv.rth America) 
 in American vessels ; and about three times as great as the foreign commerce of the United 
 States iu both American and foreign vessels. 
 
 Me also states that during the live years ending June 'W, 18^8, only H9 per cent, of the 
 aggregate tonnage entered at ports of the United States from foreign countries was in Ameri- 
 cau vessels; the remaiuiug Gl per cent, have been iu foreign vessels. 
 
iiiistVr of 
 
 ' frontior 
 
 to Ainei- 
 
 i British- 
 American 
 wncrslii]* 
 •nl of t]u' 
 »o(ls from 
 ,vays are 
 anotlior, 
 where on 
 ,ar(ls are 
 iid of our 
 
 ed on the 
 ilf. Few, 
 ri^', CY are 
 isi<lerably 
 e. If the 
 airy, the 
 Lie to our 
 •ouj;h the 
 Is to less 
 li them. * 
 illowin^' a 
 
 , can our 
 lould also 
 use trans- 
 
 aud our 
 ins aidinjj;- 
 
 ovements, 
 qou of the 
 
 countries, 
 Ducessions 
 lense pub- 
 to-day tind 
 ystem, the 
 
 the act of 
 
 n his speech, 
 ■ a country is 
 ■mcnt of pros- 
 •e which sails 
 ir canals, is in 
 s of this couu- 
 
 natps that, the 
 KM'cc hetween 
 .,rth America) 
 of the United 
 
 •r cent, of the 
 was in Aineri- 
 
 I 
 
 COMMERCIAL RELATIONS WITH CANADA. 
 
 15 
 
 i. 
 i 
 
 1700, permitting the transit of foreij^n and domestic j»'oods, first throujjh 
 our territory, then throu{»h Canada, and afterwards to their ultimate 
 destination in this country. 
 
 The privilege Avas acconled to Canadian railways to carry foreign or 
 American merchandise from one ])art of the United States to another, 
 while the navigation act of 1H17 prohibited the <*arriage of the sa^n» 
 property by foreign vessels from one \n)rt to another jtort in the United 
 States. It should be remembered that the same facilities enjoyed by 
 Canadians over our citizens in shipbuilding also inure (|uite as fully to 
 their advantage in the construction, operation, and repairs of railroa<ls, 
 and that competition between lines on the ditt'erent sides of the national 
 boundary is not merely a (piestion of distance, alxmt which no just doubt 
 can be raised, but also of cheap construction ; and to aid in this direction, 
 the Canadian has not only labor ('omj)aratively untaxed, but also a jtlenti- 
 ful snpply of nutaxed timber and untaxed iron in all re(|uisite forms. 
 
 Further investigation of this branch of the subje<*t is now omitted, as 
 the instructions from y(m dated March L*7, ISOS. directing me to incpiire 
 into the workings of the regnlations of the Treasni-y Department, so far 
 as they relate to the northern fr()nti<*r, are more fully considered in a 
 supplementary document, showing the sni»erior advantages thus enjoyed 
 by the Canadian railways in comiJctition with our own. 
 
 ESTIMATE OF THE ST. LAWRENCE ROUTE. 
 
 As an exi)lanation of the partial character of the treaty in not ])i'ovi<l- 
 ing for a really reciprocal exchange of the i>rodncts of labor, it is often 
 urged that the admission to the 8t. Lawrence and its canals coin])ensated 
 for the deficiency. If with the advantages conferred upon our territory 
 by nature, we cannot on a footing of just (Mpiality maintain the superiority 
 of our transit system, we ought to succumb; but an im])artial examina- 
 tion discloses the fact that while the navigation of Lake Michigan, granted 
 to the Canadians by the treaty, has been of nnich benefit to their shijt- 
 ping, which by its cheapness drives our own heavily taxed vessels out of 
 the tield, those have been greatly mistaken who imagined the St. Law- 
 rence would prove a ^reat highway from the west to the ocean. 
 
 COMPARISON WITH THE AMERICAN ROUTE — NATIONAL CANAL l»OLICY 
 
 OF NEW YORK. 
 
 As the navigation of this river was on<^ of the sui)i)osed equivalents 
 granted to us by the treaty, its real value bec(>nu's an important subje<*t 
 of investigation. Beyond this it cannot be alleged that Canada has any 
 equivalent to give us for the advantages of our markets. Hence a com- 
 parison between that nmte and the connecting iine bet we<'n the lakes 
 and the ocean through our own country is an essential portion of the 
 answer to the inquiries sul)n>itted to nu». Nor can consideration of the 
 terms on which the use of the great American canal is «'njoyed by the 
 j)ublic be i)roi)erly omitted, as that work is the chief competitor with the 
 Canadian lines, and we dei)end ujton it lor the maintenance of commer- 
 cial suprenmcy in competition with Canada. 
 
 No other work of eciual magnitude is known to us, excej)! the canal of 
 Languedoc, by which, t\\o centuries ago, Louis the X I\", known in history 
 as the "Crand Monarque," the most nuigniticent sovereign who ever 
 occupied a throne, connected the Mediterranean sea with the Atlantic 
 ocean. The i)olicy adopted by the enlightened statesuicn who i)rojected 
 both these great works was alike. That Of the State of New York was 
 so far to improve the geograi)hical advantages of our jiositiou as to pass 
 
16 
 
 COMMERCIAL RELATIONS WITH CANADA. 
 
 through our territory the then iiTi(leveh)i)ed commeree of the west, and 
 gradually to improve these facilities to sueh a degree as would be necessary 
 to meet the requirements of tue growth. Statesmen did not at first fore- 
 see the future importance of their work as the means of international 
 communication across the continent, but they recognized the wisdom of 
 Louis XIV through Colbert, his jn'ofound and sagacicnis financial Uiin- 
 ister, in relation to the tolls on i)ublic canals or national highways. This 
 formed a noble precedent for the policy adoi)ted by those wise and ven- 
 erated benefactors to that Stjite and the nation as to our chief thorough- 
 fares. The French monarch placed the to^Is on his great work at so low 
 a rate as to be only an adequate compensation to Reque, the engineer, 
 for keeping it in a good, navigable condition. This i)olicy was adopted 
 not so much with a desire for the welfure of the French i)eople as from 
 the more selfish but eidightened motive of raising the greatest amount 
 of revenue. The king was justified by the results, and found that if 
 considennl solely as a cpiestion of financial policy lor his exchequer, it 
 was better to tax wealth only when it had accumulated, and not to arrest 
 industry in the work of ijroduction or in the cheap and profitable ex- 
 change of conunodities. 
 
 lu every Just ai)portionment of taxation the increase of taxable wealth 
 decreases th(i burden upon tlu^ individual and the masses. All eminent 
 vriters on political economy confirm the belief that whether the freedom 
 of internal commerce and industry b(^ interrupted by impassable moun- 
 tains and swamps, or by oppressive tolls or restrictions, the efiect is 
 equally pernicious. 
 
 When she entered the Union the State of ^New York relinquished that 
 part of her revenue whi(;h was derived from duties or taxes on foreign 
 comnierc<?. In the same spirit of true union the national character of the 
 canal was fully recognized from the beginning; and the State, declining 
 to tax iidand connnerce, never used the tolls levied upon transit, except 
 to repay the cost of nmking the canals and of maintaining them, thus 
 granting facilities to the transit of western productions at a time when 
 she possessed a monopoly of the inland trade, and practically recognizing 
 the light of free way through her territory, as a light of nature whicli 
 could not justly be withheld from the States of the interior. The leaders 
 of public opinion in the State, without distinction of political party, now 
 adln^re to tlu* view thus early adopted. They seek by the development 
 of mutual jind material interests to strengthen the bond of union between 
 the States. 
 
 Much of the value attributed to the navigation of the St. Lawrence 
 has arisen from the traditionary estimates placed ui)on it when no other 
 line of communication by water connected tlie great lakes with the ocean. 
 The Hudson penetrated far toward the inland seas, and thus dictated 
 the site of the comnunx'ial metropolis of the Union. But beyond Liie 
 navigable i)ortion of that river transit was difiicult, and its cost so great 
 as to be prohibitory. In this condition of aft'airs the minds of the early 
 settlers in the then "far west" naturally turned to the exit attbrded by 
 the inagnifi(,'ent river fed from the great lakes. If at that time the banks 
 of the lower St. Lawrence had been occupied by people animated by the 
 enterprise and foresight of commercial life, and if the State of New York 
 had not then numbered among her citizens men of a comprehensive 
 sagacity never surpassed, and combined with statesmanlike intrepidity 
 and perseverance no less remarkable, the St. Lawrence might have 
 become the great tlKuoughfare from the western States to the Old World; 
 our national trade would for a time have been deflected northwards, far 
 beyond the boundaries of the Xew England States. Montreal would 
 
 I 
 
COMMERCIAL RELATIONS WITH CAN.VDA. 
 
 17 
 
 eat, and 
 ecessary 
 li'st fore- 
 ■natioiiul 
 is«loiu of 
 rial mill- 
 >s. This 
 and veii- 
 lioroujuli- 
 ,it so low 
 3iij?ineer, 
 adopted 
 i as from 
 ; amount 
 a that if 
 lequer, it 
 to arrest 
 [table ex- 
 
 le wealth 
 1 eminent 
 ' freedom 
 )le moun- 
 efl'eet is 
 
 shed that 
 m foreign 
 ter of the 
 declining 
 it, except 
 lem, thus 
 ime when 
 cognizing 
 ire whicli 
 le leaders 
 arty, now 
 elopment 
 I between 
 
 Lawrence 
 no other 
 the ocean. 
 s dictated 
 eyond Lue 
 t so great 
 the early 
 forded by 
 the banks 
 ed by the 
 N^ew York 
 irehensive 
 ntrepidity 
 ight have 
 Md World; 
 wards, far 
 eal would 
 
 have taken precedence of New York. The wliole commercial i'ondition 
 of the continent might have been temporarily changed, and the trade and 
 raanufactures and shipping of Great Britain would have been fostered 
 and promoted to the same extent as the jnogress of our own wouhl have 
 been impeded. At the time when the\ were needed, nu'U worthy of the 
 occasion opportunely arose among us. They apiueciated the momentous 
 importance of having the commercial metropolis of tlie continent within 
 our own domain; saw the signilicance of the great valley through the 
 interior of the State ; understood the geographical nature of the conti- 
 nent, and the finger of destiny did not point in vain at the only portal in 
 the Alleghany mountains, through which the waters of the lakes and 
 their commerce are now jnactically conducted to the mcmth of the Hud- 
 son, with immense i>rolit to th<' nation in every department of its imiustry. 
 
 The undertaking thus initiated had so much intluence upon our com- 
 mercial relations with Canada in the i)ast, has now, and must hav<' more 
 in the future, if a wise* and liberal policy is adojited by the general gov- 
 ernment, that a brief historical reference to the views of its lonnders, 
 and the principles in which theij" successors have been govermd, faith- 
 fully indicate what that policy should be. 
 
 In 1808, when discussions as to the Erie canal first assumed the form 
 of definite action in the legislature of the iState of New York, all minor 
 and selfish interests were i>atriotically regarded as suhordinat<' to the 
 national welfare. The legislature itself, voluntarily renouncing the 
 iulvantages of geograjdiical ])osition, except in i>arti('ii)ation with the 
 other States of the Union, confidently exi)eeted aid from the nation at 
 Uu*ge, and i)assed an act "causing anacc-urate survey to be nuule for the 
 most eligible and direct route for a canal t(^ open a communication between 
 the tidewater of the Hudson river iind Lake Erie, to the end that ('<ni((re.sH 
 may Le enabled to appropriate tiueh tiuins as niaii he, iieeesmri/for the aceom- 
 plishment of that great national objeet.''^ 
 
 On the 8th of A])ril, 1811, a further act was i)assed. The comprehen- 
 sive objects expressed in it.s preamble were b> means of a cjinal navigsv- 
 tion between the great lakes and the Hudson river, to "encourage agri- 
 eidture, promote commerce and numufactnres, and facilitate a free and 
 general intercourse between the different parts of the L'nited States, 
 tending to the aggrandizement and i)ros]>erity of the country, and to 
 consolidate and strengthen the Union." 
 
 Clinton, Morris, Fulton, and others, were appointed commissie»nirs lor 
 the consideration of all matters relating to the proposed iidand naviga- 
 tion. Th(^y were empowered to make application in behalf of the State 
 to the CongTess of the United States, or lo the legislature of an\ State, 
 to co-operate in the undertaking. It was not believed that a work 80 
 universal in its benefits would be left to the isolated eftbrts of a single 
 State. 
 
 During the presidency of James Madison the commissionejs thus 
 delegated proceeded to Wa.shington and presented the a])plication to 
 Congress. The l*resident made their ])roi)osals the siibje(!t of a special 
 message, dated December 3, 1811, recommending the proposed under- 
 taking for its national as well as its militaiy ol))ects, and suggesting the 
 adoption of whatever steps might be necessary to insure its aecomjdish- 
 ment. At the request of Albert Gallatin, then Se(;retary of the Tr<'a.sury., 
 Clinton, Morris, and Fulton drew a bill, in effect, a]>pro])riating •^8,()00.0<.K) 
 for the work, and embodying the memorable words : "0/t eonditiun mrer- 
 theless that no tax, toll, or impost shall be levied upon the passage of boats 
 through the said canal, other than such as may be needful to pay the annual 
 ejo*)enses of superintending and leeping it in repair.'"' 
 
 " 2n 
 
18 
 
 COMMERCIAL RELATIONS WITH CANADA. 
 
 
 •1 
 
 The bill, together with the special message of the President, was reforrod 
 to a large committee and was favorably received. Gallatin, the Becro- 
 tary of the Treasury, in answer to a letter from the committee, urged 
 their favorable action upon consicU^rations of the wisest statesmanship 
 and ]Mirest patriotism ; but as expectation, verified by subsequent events, 
 was held that a rupture with Great Britain was impending, Oongre«8 
 finally dec^lined to make the approj)riation at that time, on the ground 
 thfit " the H'sonrces of the crountry might be required to support a war." 
 
 The (unnmissionjTs marked their sense of the refusal to grant aid to a 
 national objcM^t no less important in war than in peace by saying, in the 
 (conclusion of their report to the legislature: 
 
 Theao nioii consolo tlicmsrlvcs with a liope that tho envied iState of New York will con- 
 tinuu a suppliant fi>r tho tavor and a depenucnt upon the (reuerosity of the Union, instead 
 of makiu(; a munly ami diguitied appeal to her own power. It remains to l)e proved whether 
 they judge justly, who judpe so meanly of our counsels. 1 
 
 Congress having told the New York statesmen to wait until the war 
 was over, they replied that they would not wait; that "'delays were 
 always the refuge of weak minds." In the current language of those 
 days they called ihv work " the grand Erie canal," appreciating the 
 sublimity of the bcniefit^ent changes it would produce in oi)ening out 
 lor immigration and the use of mankind an areji of fertile land greater 
 in extent than the narrow edge of the continent occu])ied by the leading 
 nations of the Old Worhl, more clearly in the confidence of their well- 
 Omnded hoix's than W(^ <lo now who look at their realization as a fact 
 accomplished long ago. 
 
 After the jjostponeinent of aid by ('ongress, applications wtue made 
 to the legislatures of difterent States ; stneral of them returned favor 
 able answers, but the war with Great IJritain having begun, little pro 
 gress was made. 
 
 On the loth of November, ISIO, DeWitt Clinton, as president of a 
 
 board of commissioners, appointed the previous year, renewed the appli 
 
 ration to the government of the United States, and on behalf of this 
 
 State he rei)resen ted, again l>ore significant testimony to the lofty purity 
 
 of her motives in seeking her own interest only by promoting tlie 
 
 national welfare. He said: 
 
 The State of New York is not unaware of her interests, nor disinclined to prosecute them, 
 L;:t when those of the general government are concerned and seem to be paramount, sho 
 deems it her duty to ask for their assistance. 
 
 Finding that all her efibrts to secure aid from other States or the 
 general government were unavailing, the State of New York alone and 
 with the slender resources of those days resolved to commence the 
 gigantic undertaking. Even then she persevered in rejecting consider- 
 ations merely selfish. Her commissioners repudiated the idea of a 
 "transit duty "to be levied for the advantage of the State, and said this 
 would be "the better course if the State stood alone, but fortunately for 
 the i)eace of the Union this is not the case. We are connected by a 
 l)ond which, if the prayers of good men are favorably heard, will be 
 indissoluble." 
 
 The iw.t inaugurating the construction of navigable comnumicatious 
 between the great western and northern lakes and the Atlantic ocean 
 was passed by the State, April 15, 1817, and was based upon an impor- 
 tant memorial presented to the legislature by the leading merchants 
 and men of iniluence in the city of New York. It stated that — 
 
 Whereas navigable communications between Lakes Erie and Champlain and the Atlantic 
 ocean, by means of canals connecting with the Hudson river, will promote agriculture and 
 manufactures, mitigate the calamities of war, and enhance the blessings of pe&ce, consolidate 
 the Union, and advance the prosperity and elevate the character of the United States, it is 
 
COMMERCIAL RELATIONS WITH CANADA 
 
 1!) 
 
 B rofcrrod 
 ho Secro- 
 Rc, urged 
 smaiiship 
 rit events, 
 Ooiigniss 
 e ground 
 rt ii war.'* 
 t aid to a 
 ig, in the 
 
 •k will con- 
 Ion, inBtead 
 veil whether 
 t 
 
 i the war 
 ayn were 
 of those 
 iting the 
 ining out 
 (1 greater 
 e k'ading 
 heir well- 
 as a fact 
 
 iue made 
 
 led favor 
 
 ittle pro- 
 
 ilent of i\ 
 
 the appli 
 
 f of this 
 
 tv purity 
 
 >ting the 
 
 ecute thoin, 
 imouiit, sho 
 
 »s or the 
 ilone and 
 ence the 
 eonsider- 
 dea of a 
 said this 
 ately for 
 ted by a 
 , will be 
 
 ideations 
 ;ie ocean 
 n inipor- 
 erchants 
 
 he Atlantic 
 ;ultui-e and 
 consolidate 
 tates, it i.s 
 
 .1 
 
 1 
 
 I 
 
 the incumbent duty of the people of this State to avail themselveH of the means which the 
 Almiehty has placed in their hands for the promotion of such sif^nal, extensive, and iaHtiiip; 
 henents to the human race. 
 
 Having originally taken upon herself whatever there might have? 
 been of risk in making at her own unaided cost a channtil of cheap com 
 munication by water between the citizens of tln^ eastern iiiid western 
 suites, and between those of the west and the gieat highway of tin; 
 world, the Stiite of New York, from ])atriotic motives, continues to hv 
 the great regulator of the c-ost of transit between tlie east and wcst^ 
 protecting no small proijortion of the people of the Union against those 
 extortionate charges which might have been hivicd if the canal, with its 
 luitural monoi>oly of position, had falUMi into the hands of si)eculating 
 individuals or companies. It is computed that during the six months 
 of navigation the canal alone carries as large a tonnage of freight as the 
 live chief trunk railroads from west to east during the whole year, at 
 half the cost to the public, being a saving annually, in transjuntation by 
 wat<^r, to the great consuming and producing classes of the northwest- 
 ern and eastern Stat<'S of $30^580,000. 
 
 The average cost from Chicago to New York via tlie lakes, the lOrie 
 canal, and tlu^ llmlson river, including canal tolls and carriers" in-ofits, 
 embracing a period of 10 years, is $7 00^. The cost of transportation 
 on the Central railway, as given in annual reports, taking tlie avel•ag«^ 
 for six years, is one cent four mills and nine-tenths of a mill per mile, 
 not including carriers' proiits. This average applied to the distance from 
 $C 05.1 more i)er ton than the average cost for a period of 10 y«'ars via 
 Chicago to New York by rail, 98S miles, makes $14 .'Jl.O per ton, or 
 the lakes, the Erie canal, and the Hudson river, including {State tolls 
 and proiits of carriers. The through freight moved 4'astward by the live 
 trunk lines and the Erie canal is about, in round numbers, 5,500,000 
 tons, which, if multiplied by $0 05.1, the diflerence before mentioned, 
 would make a ditl'erence between rail and water transportation of all 
 carried by either method of $30,580,500, and with the i)rolits of the 
 railway comi)anies added to the actual cost would augment this amonut 
 largely. 
 
 IlKHIT OF WAY THE IllGriT OF TIIi: MILLION. 
 
 There is no withdrawal from the original doctrine of the State that 
 the canal should bt^ considered as a trust from which the State shoidd 
 receive back simply what it advanced for construction ami maintenance, 
 and employ the sur]>lus for the improvement of the work and (jheapen- 
 ing the service it renders tt) the public. Such were the views held at the 
 constitutional convention of the State in 1807,* when the ])rinciples 
 enunciated in 1840 by its master spirit, Michael llofll'raan, Avere quoted, 
 reiterated, and a])proved by the leading men on all sides. He said: 
 
 The right of tray is the right of the million. The sovereign holds it in trust, and can exer- 
 cise it only for their benefit, and has no right to make a revenue out of it. Such a course 
 must engender the worst oppression and the worst corruptions, and soon realize the worst 
 vice* of the worst governments — taxation on all we consume, which will allow nothing to 
 go to or from the markets without tribute to the State. 
 
 NATIONAL CHARACTER OP THE CANAL. 
 
 Tlie truly national character of the work and of its value is shown by 
 the fact that the commerce passed over it and belonging to the people of 
 
 * Evarts, Tilden, Church, Corning, Opdyke, Dr. Dwight, professor of international law, in 
 Columbia College, Brooks, Murphy, Eustiss, Cas^idy, Clark of Rochester, and others, mem- 
 bers of the New York constitutional convention in 1867, lepudiated the idea of taxing com- 
 merce upon the canals, maintaining that only tolls should be levied to pay for construct'on 
 and repairs. 
 
20 
 
 COMMKUOIAL RELATIONS WITH CANADA. 
 
 it« own Htatc is only t)n(>-ninth of the {ijjfj?rc;;ato, tin* n'msiimlcr coining 
 from the wivstiTii aiul iM'iitrsil States, or (Jansul;i. Tlio Stjitcof Now York 
 tlot'H not furnish as largo an ainouiit of tonnage for the canal as is Hup 
 plied by citlior Michijjan, Illinois, or Wisconsin, Hin*fly. No less eonclu 
 sive is the testimony of half si century as to its nneqnivocal sncc^esw, 
 present value, and certainty of the continue*! incn'ase of its trade. 
 
 The nja}j:nitude of the juesent annual jmxlurtions of the States l;order 
 in^; on the lak<'s is not entirely unknown to th<' public; but few know how 
 fertile is the soil and jjcnial the.<'liniate of the vast areas to the north- 
 west of Jjake SujUTior, soon to l)e('ome settled jind increase that yet 
 undeveloped commerce of the lakes which will pass throuji^h our own 
 tenitory, enrich our merchants, employ our own people, and aid in 
 diminishing; our national burdens, if we are true to our own Just interests 
 and are faitliful stewards of the ])ublic trust committed to our (charge. 
 
 Already the averajje unnuul inconie of tin* canal, after (hMlucting [ill 
 exj)enses, is $.'>,(MM),()()0, carefully apjdied to the extiiu'tion of the debt 
 incurred by the construction. At the ])resent rate of income, not com 
 putin;» its i)rospective increase, the debt will b(» wholly dischurjjfed in 
 eijjht veais. Subj(»ct to the existinji" lien on it the canal "could now b<^ 
 readily sold for at hnist .$r)0,(M)(),0()(). 
 
 It has been seen that in the rivalry betw4M'n the carryin;; systems of 
 the 8t. Lawrence river aiul the Erie canal, or Hudson river, the rouU^ 
 through our own country is incomparably the most successful competitor, 
 aftbnlin*;, even to a larjjfe ])roportion of the ('anadians themselves, the 
 best means of comnnniicatinj;" with Atlanti<* ports and the world at large. 
 Yet it is said that with certain enlarj^ements of her canals the St. l^aw- 
 rence would b(»ar away the i)alm of victory, and British-C'anadian capi- 
 talists are urged to invest in the doubtfid experiment. A sum small in 
 comparison with the present cost of the Erie canal, expended in judicious 
 imi)rovements ni)()n it so as to permit the passage of boats of a greater 
 size, would reduce by one-half, or 50 per cent., the i)resent cost of trans- 
 portation on it. A similar saving has been actually etfected by similar 
 means already ai)i)lied, and competent engineers and statisticians bear 
 testimony to the repetition of ecpml results from further improvement. 
 
 I 
 
 PROPOSED IMPROVKMF.NT OF THE CANAL AND ITS NATIONAL RESULTS 
 
 « 
 
 . Under the liberal system hitherto adopted by the State of New York, 
 this reduction in the cost of freight wouhl inure to the benefit of the 
 western farnuT by pra<^tically diminishing distance between him and the 
 consunuT in the cities and manufacturing districts in the east, and our 
 customers throughout the world. The St.ate, after all her expenditures, 
 is yet ojdy the friendly channel or medium between the producer and con- 
 sumer, and is interested for her own citizens only so far as they constitute 
 a part of the whole people of the Union. 
 
 In a i)revious rej)ort the attention of t'ongress was called towards 
 securing the realization of the proposal of the State of New York (stiU 
 embodied in a law) to adapt the Erie and Oswego canals of that State 
 to the military uses of the national government. To attain this object 
 only a small sum is necessary compared with that required to overcome 
 the natural obstacle of Niagara Falls. The desired result could be 
 attained in one-third the time and at one-third of the cost necessary for 
 the completion of any practical work that could carry the line of trade 
 round the falls. Nor would the adaptation of the New York canals to 
 the uses proposed be only an experiment, costly in expenditure of time 
 and money. 
 
 4 
 
 1^ 
 
COMMERCIAL RELATIONS WITH CANADA. 
 
 21 
 
 coming 
 ow York 
 
 ) <'.on('.]u- 
 
 SIICCOHH, 
 
 i lioidor 
 low how 
 «' north - 
 thiit yet 
 Hir own 
 I aid in 
 ntor(>8tfl 
 Inirgo. 
 ntin^ all 
 tho debt 
 lot com 
 lUfjod in 
 now 1)0 
 
 stems of 
 lie routi^ 
 ipctitor, 
 vos, the 
 it large, 
 ^t. Ijaw- 
 m capi- 
 unall in 
 ulicioiis 
 ffi'cator 
 >f trans- 
 similar 
 ,ns bear 
 v^ement. 
 
 3SULTS 
 
 v^ York, 
 of the 
 and the 
 md our 
 iitures, 
 nd con- 
 istitute 
 
 owardH 
 'k (stiJl 
 t State 
 object 
 ercome 
 iild be 
 ary for 
 ' trade 
 uals to 
 f time 
 
 I 
 
 ImprosNod with tiiese considerations, and the fact that ai)pli<'ations 
 are now entertained by (!ony:resH for the j;rant ol' hirjje national aid to 
 open new commereial elnunu'ls and im|)rove old ones from the west to 
 the seaboard, it is respeetfully submitted, us a measure of sound politieal 
 economy, rejL^ardinp: the national wealth and the revenue to be <lerived 
 from it, that such aid as may be necessary for tlie Judicious iiu]>roveinent 
 of the Krie (tanal to its maximum eapaeity for trarjspdrtntion, so as to 
 enabh^ it to carry ex])editi(msly and at tlu* lowest practi<'abhM*ost such 
 freij,dit as nuiy be broujjht to it, shall be ^'ranted by th(^ general govern 
 ment of tlu* IJnited States, provide<l the Stat<»of New Y^ork shall, at the 
 same time, plcdjje its faith by a simph' hnv, embodyinjj: in sulistani'e tin- 
 traditionary ])olicy <»xpressed by dlinton, Morris, and Fulton, that 'MU'V 
 the cost of theeanal has been ])aid no tax, toll, or im])()st sliall b<> levied 
 npon the pjissajjfc of boats throuy:h the said eanal other than shall bo 
 needful to i)ay tlu^ annual expense of superiuteiidin;,^ and keepiu); it in 
 repair; thus romph'tiujur a free national (•hannel of inland navi;ration 
 extending 1,000 miles to tlu^ centre of the continent, and luactieally <!ar 
 rj'ingout the most important teatun'ol' the ( 'onstitution, l)y establishing 
 free tra<le and tm? commerc(^ bctwcjui the State's. 
 
 In the presence of these historical reminiscences and commercial and 
 financial considerations, it may now be well asked if the time has not 
 arrived wlien the peneral j^overnment should not adopt the policy advo 
 cated by Madison, Gallatin, (Hinton, Morris, and Fulton, by extendinj^ 
 its stronff arm and takinjj "the vexed (piestion" of the imiuovement of 
 this ifreat national channel-way of internal <M)mnierc(^ to its maximum 
 capacity from the arena of narrow, contlictinj,' political and local inter 
 ests, and relieve the friends of a comprehensive and j>ro;;ressive policy 
 in rej^ard to it from those long and tryinjjf struj^gh's and delays whicli 
 have always i)receded important improvements. Oan national aid bo 
 extended to any o1)ject throus:h whi(^h tlu^ national ju-osperity and rev- 
 enue could be so lar^^t^ly increased 1 Should this i)olicy be adopted, t\w 
 trade and comment' of the border nation would in the future, as in th(^ 
 past, contribuUi to our public welfare, yieldin*^ to the suprema(!y of our 
 natiomil advantages, and the dominion of Canada would desist from any 
 further unprotitable rivalry. 
 
 Had the Canadians been willing to a<'c<»j)t the liberal privileges 
 extended to them in the fraternal spirit they were granted, yielding to 
 the destiny unalterably tixed by geogra})hy, climate, and the b«)unda 
 ries established under the Ashburton treaty, and not vainly attempted 
 to exercise a commercial domini(m (worthy of imi)erial anibition) over 
 our western trade, and its transit lines to the Atlantic, they would 
 to-day have been enjoying commercial free(h)m, and free access to our 
 markets for the sale of their products, and would have been permitted 
 to retain the advantages which the reci])ro(!ity treaty gave them by 
 placing them on a commercial ecpiality with the States of this Union, 
 without being subject to any of its burdcjis. 
 
 Neither the trade nor the public works of any other count ly shouhl 
 be looked upim in an unfriendly s])irit. It is ignoble to hold other 
 nations back, or obstruct the chariot wheels of ])rogress in any i)art of 
 the world. We should rather seek })re-eminence by developing those 
 national advantages in our own country which, while they promote our 
 own prosperity, will also benefit others. The expressions of Mr. Burlin- 
 game when at the head of the Chinese embassy (he said, " We come 
 here to seek the iinitication of the human family, and we trust that all 
 will meet us in like spirit in this republic") * embody the policy we should 
 
 * Mr. Burlingame's reply to Mr. Hatch's address to the Chinese Embassy, at Niagara Falls. 
 
20 
 22 
 
 /"« r« • • • * ■ 
 
 COMMERCIAL HELATIONH WITH CANADA. 
 
 «v<;ryw!ien^ crulcavor to r,arry into rfliiict. Tlic- oflicial onnnciation of 
 UiiH (I(N'irino on Ix^lialt' of tli() ki*<'«>'^' oriental (tm)»in^ was an cvttnt of 
 H<;ar<'.('ly 1(>hs iini)ortaiuM', than the departuK^ of (JoIuuiIhih on his voya|;c; 
 of (liHcovcry to this continent. Certainly th(; ('anadians woiv inei in 
 thiH Hpii'it when tlic treaty was negotiated. If inst4^a(l of this fri<'n<Uy 
 poliey the IJnit4Ml States ha<l adopted towards them the illilMU'al eonrs<>. 
 ur^ed hy th<' (^anadian minister npon his own country, when he said, 
 *' W(5 must ke«'|Mnir (»wn trade within and ov<'r its own (rhannels asmu(;h 
 as possible,"' we, slionld nev«*r hav<^ <'(»ne<'ded to iM'r free aci-ess to our 
 markets for all she has to sell, and left open for taxation nearly all we 
 sell io her for her own use andeonsnmption, or p(>rmitted the free retnrn 
 of ]»r()dnets or freight to this si(h> without paym<'nt of duty, after liav 
 in;; passed over <!ana<lian railroads. 
 
 V\w first formidable opposition, stimulated by the popular s<Mitiment. 
 against the tr<'aty, arose from the fre(pient and short -sitrht<'d renun- 
 ciation, in avowal ami prartiee, of the |>rineiple of reeijjroeity by the 
 (*amidiaus. Not only did the Canadian minister commit this error in 
 his public utteraiu'cs, but, as has been already stat«'d, he endeav(uvd to 
 couiit<'ract the natural (itfccts of the treaty by laws discriminating 
 against us. 
 
 Ili^lu-r duties were ])lac<'d upon our manufactures. Laws were ])assed 
 to iM'evcnt our men^hants from selling to t!anadians merehandiKe 
 im]K>rt<'d from other countries, and to force busiiu'ss to the (/amulian 
 railroads and canals; aiul legislative enactuu'uts were passed, interfering 
 with the natural course of trade, and depriving our peoi)le of its just 
 benefits. The grievauc<^ was by no means theoretical. Under the tariirs 
 and regulations jidopted by Canada tlu' trade of our iidand <'ities with 
 her was <h'stroyt'd, manufa<'turers brok(^ up their establishm<'nts and 
 removed to tin* ])roviiice,and the trade of oui* Atlantic citi«'s with Canada 
 in imported goods was transferre<l to Montreal. 
 
 The belief, originating in these rc^asons and hehl by ('ongress, that 
 the sj)irit and substance of the treaty of Washington had been <lisre- 
 garded by the legislators of (Canada, led to its termination and the refu- 
 Ral to authorizes any negotiations for its renciwal. Nor have the Cana- 
 dians, in proposals submitted to Congress in lS(i3, or at any other time 
 ever oftered to make such additions to the free list as would fairly cii 
 out a system of Just exchange. 
 
 ily cariy 
 
 CONCLUSIONS. 
 
 A treaty, if thoroughly reeiinocal. would include all the products of 
 labor on both sides, or at lesist i>rovide for a fair and equal exchange of 
 them. The party selling the productions of agi'icultur(5 and the forest 
 should nsmove all laws ju-eventing the sale of nianuftictures on the part 
 of the other, and under the present condition of our revenue laws com- 
 petitiim between tlui people of the United States and Canada can only 
 be on e<pial terms when duties equal to those directly or indirectly 
 exacted by our government from our own citizens are levied on importa- 
 tions the product of Canada. The same principle evidently applies to 
 the competition of the cheaply built and untaxed railroads of Canada 
 with those of our own comitry, which, through the tariffs and various 
 methods of internal taxation, contribute largely to the revenue of the 
 United States. 
 
 In the clear light of past experience our commercial advantiiges wouW 
 be fairly estimated in fixing the basis for renewal of reciprocal trade. 
 Nor could the well known fact be overlooked, that since the termination 
 
COMMKKCIAL RKLATI0N8 WITH CANADA. 
 
 23 
 
 i'iation of 
 I v\v,ut of 
 lis voyuRC 
 ro iiM'.t in 
 s frU^mUy 
 (ral cours*'. 
 >n he- Kiiid, 
 Is as much 
 •CSS {{} our 
 inly all wt; 
 
 AiWY hav 
 
 sontiiiuMit. 
 UmI rcmiii 
 •itv by the 
 liis error in 
 U'avoivd t<» 
 •liniinatinj^ 
 
 kvcrc ])assed 
 icichandisc 
 (> Oaniulian 
 , intciicring 
 5 of its just 
 »!• the taiitfs 
 I cities with 
 iments and 
 vith (Canada 
 
 nj^ress, that 
 been disre- 
 nd the refu- 
 e the Cana- 
 other time, 
 fairly carry 
 
 products of 
 exchange of 
 id the forest 
 1 on the part 
 ae laws com- 
 iida can only 
 3r indirectly 
 Ion importa- 
 ly applies to 
 Is of Canada 
 
 and various 
 ;venue of the 
 
 utages would 
 iprocal trade. 
 e termination 
 
 4 
 
 of the n^ciprocity treaty foreign immigration to Catiada no longer stops 
 there, but passes on to th«' HtJites. If the value of the fori'ign labor 
 immigrati<Hi is <M>rrectly estimated by the (Jommissioiier of liit>ernal 
 Uevfuiue, in his re<'cnt able repcyrt, (and who doubts it, wlieii our vast 
 undevelo|)ed res(»ur<H's, with our opportunities for their development, are 
 considered f) then^ are now millions of dollars added ainiually to oiir 
 mitional wealth from this source of productive industry. The very large 
 amount of revenue, too, now not less than st^ven millions of dollars, 
 annually derived from Canadian proiiuctions without diminishing their 
 importations, deserves and must rceive grave thought in any future 
 negotiation between the I'nited Stat<'s and the new dominion. So, also, 
 will the advani'cd condition of nmny manufactures in Canada, originat 
 ing in the unfair advantage taken of die freedom accoided to her by 
 the treaty. 
 
 Instructed by the lessons of the past, and a knowlrdge of our preseni 
 financial recpiircmcnts, a treaty so much desired by Canada iiiiuht, ru) 
 doubt, be made so «'omprchensive in all its details that neithei- party 
 could lie mistaken as to its resiUts, or Im; capable of evading its spirit or 
 substance; or our future intercoursj* might be left where it now is to 
 reciprocal or iii<lependent legislation, to be changed trom time to time as 
 the varying interests of our donu'stic or international relations or the 
 violation of reciprocal obligation might leiiuin-. 
 
 isiiAKL r. HATCH. 
 
 Hon. Hugh McCrLLocir, 
 
 tSt'cmtary of ilw Trcnunr!/. 
 
 AIM»KNI)IX A. 
 
 Th(» following are the extracts from statements made by the collectors 
 at the leading olVices where tin' revenues are now collected on the north 
 crn frontier : 
 
 ''OciDKNSni'IKJ, Auffust :\j ISOH. 
 
 "The supply and demand in the United Stat<'S is so much larger thaji 
 ui Canada, that importations from there atteet our markets but litth'. 
 
 The following articles are not, in my opinion, im|)orted IVoni Canada, 
 in suni(;ient<piantities to affec't our markets: Uutter, cheese, eggs, wheat, 
 rye, oats, barley, an<l becfcatth'. Our imjjortations of these articles are 
 so small, compai'cd with our productions and witli ourexjxMtations, thai 
 we can be atTect<'d but litth' by the supi>ly tVom Canada." 
 
 '•rLATT.snriid, 'hoiv s, jsos. 
 
 •" I submit the following stat<'iiient as an illustration apj)licaMe very 
 generally to all importations made into this district. This |»ast spring 
 large (piantities of potatoes have bci'ii inijtorted into this district, and 
 the <luty of 25 cents jx-r bushel, gold, paid l)y the Caniidian seller or 
 exi)orter, as the sale has generally been i»ertccte(l on the (iiited States 
 side of the boundary line, <luties ])aid. The American speculator buying 
 at such prices as to successfully compet<^ with sellers in the Jioston 
 market, <ioes the consunun' of the imported potatoes pay the duty to the 
 United States when he ])urchas(\s the potatoes at the samc^ price that 
 another pays for the American ])roduct? If tlu^Caiunlian cannot exi)ort 
 his goods at a profit, or the specaUator cannot buy in the foreign market 
 and i>ay the tluty at a price that he can sell at in the American market 
 at a profit, he does not purchase. The same can be said in relation to 
 grain, and in fact of nearly all importations into this district." 
 
24 
 
 COMMERCIAL RELATIONS WITH CANADA. 
 
 *' Cleveland, October 20, 1808. 
 "Tlie ciiief articlcH of importation at this poit are lumber and barley. 
 The lumber market here is entirely controlled by the Saginaw market, 
 and Canadian markets do not in the least influence us. The Canada 
 market, to a great <'xt<?nt, is controlled by American markets, and the 
 result is that the Canadian producer has to conform his prices to our 
 market figures here ; this virtually makes the Canadian pay the duties 
 on foreign merchandise imported here, as he is compelled to sell his goods 
 HO as to enable the importer to i)ay the duties, and still not overshoot 
 the American market. As the demand in Canadji is not ecpial to the 
 production, the produc<'r is cimipelled to look to a foreign market for 
 sale of his merchandise, jnid for this reason lie must necessarily regulate 
 his })rices V>y that maikct to sell. The purchaser in buying always makes 
 allowanci' for tiie duties, and tlu^ Canudian in his sales deducts the 
 amount, s.nd thus in reality pays the duty himself." 
 
 ''OsWE<U), July LVJ, 18G8. 
 
 "The ctfect of the abrogation of the reciprocity treaty, in my oi)inion,, 
 has been the addition of several millions of dollars to the United States 
 revenue, at the expense of our Canadian friends. 
 
 " There never appeared to me to be any true reciprocity in it, but rather 
 the payment of a very large sum to them for something that wa,s of little 
 benefit to us. As it now is, the import duty is paid by the Canada 
 producer or manufa(;turer, and not by the American consumer. Any 
 redu(!tion in the rate of duties on imjun'tations from (Janada. would 
 benefit them Just so much, and would not lower the market value here," 
 
 "BuFFAJ.o, Dvcemher 18, 1SG8. 
 
 " The t(*rmination of the treaty of recijtrocity between the United States 
 and the Canadian Provinces, and the subsequent imposition of duties 
 under the tarifl' enactments on articles of importation, has been a source 
 of large revenue to the United State's government, the burden of which 
 has been borne by the foreign producer or manufacturer, and any abate- 
 ment or iH'duction of rates would, of course, redound to the advantage 
 of such producer or manufacturer, and would not tend to reduce the 
 value of the article imj)orted in this market. Our market establishes 
 the iw'ice, or rather limits the same, for such jiroducts or manufactures 
 as come into competition with home products or manufactures; and 
 while flu? rates of duty under the t^iriff, on some articles, amount to a 
 prohibition, as articles of generjd traffic; and while other articlCvS much 
 need(Ml are admitted duty free, still tlie bulk of the importations into 
 this district from our neighboring foreign soil are of such li nature as that 
 they enter into competition with the products of our own soil, and any 
 rate of duty established on such articles of importation must neces- 
 sarily fall upon the producer." 
 
 
 APPENDIX B. 
 
 CANADIAN TARIFFR. 
 
 A conspicuous point of difference' in recent Canadian tariffs, compared 
 with the tariff of 1859, is a general reduction of five per cent, in th€ 
 duties on manufactures. 
 
 The latest changes in the Canadian tariff were assented to in May, 
 
COMMERCIAL RELATIONS WITH CANADA. 
 
 25 
 
 1868. 
 
 barley, 
 narket, 
 Canada 
 md tlie 
 ; to our 
 ', duties 
 is goods 
 ershoot 
 I to the 
 rket for 
 'emulate 
 s makes 
 Kits the 
 
 opinion^ 
 d States 
 
 it rather 
 of little 
 Canada 
 T. Any 
 a. would 
 lie here," 
 
 1SG8. 
 
 d States 
 )f duties 
 a source 
 )f which 
 ly abate- 
 vantage 
 ucc the 
 iblishes 
 factures 
 res; and 
 )unt to a 
 es much 
 ons into 
 e as that 
 and any 
 t neccs- 
 
 omparod 
 t. in the 
 
 in May, 
 
 t 
 
 1808, and enforced from April 29, 1S(J8. The duty of ir> per cent, is yet 
 usually levied on manufactures, with special exceptions, of which the 
 character may be seen on perusal of the accompanying list. Imjmrtant 
 changes have been made in many articles use^l in and on lailroads. In 
 1851) a 10 per cent, ad valorem duty was levied on railroad bars, frogs, 
 wrought iron and steel chairs, locomotive and engine fraiiics, axles, 
 and ai)parently all articles made of iron and used in making niilways or 
 railway locomotives and cars, &c. All these are now admitted free of 
 duty. Among other articles charged with 10 jx r cent, duty in ISf)!), 
 but now entirely exempt, are anchors, metallic tubes, copper in bars, 
 bobs or sheets, «&c., and other articles used in and about shipping and 
 railroads. 
 
 The free list under the tariff of 1S(IS is very extensive and includes 
 iloTii', ciu'ii nu'al, and gruin of all kinds. There is a moderate duty on 
 animals; and export (luties<»n sawlogs, «S:c., repealed by the act of bS(;7, 
 are now not (udy levix'ed but increased. 
 
 The: following is a statement of recent changes in Canadian tariffs, 
 and of the duties on leading articleSj especially with relcicnce to Ameri- 
 can interests: 
 
 Articles. 
 
 Act of May 11, Ir^G":'. i Act of Dec. 21, 1867. 
 
 Auininls : 
 
 Horses per head.. 
 
 Homed cuttle do 
 
 Swiiip do j 
 
 Sheep do j 
 
 Butter per pound . ,. | 
 
 Chefse do ' 
 
 Cipiirs, not over '^H) jier M i 
 
 Cip^fus, over 8iO awd under S'io per M j 
 
 Cipars, over $'iO and under §4U per M f 
 
 Cigars, over ^-V) per M ' 
 
 Fish, smoked or salted perpotind..! 
 
 Lard and tallow do '. 
 
 Meats, fresh or salted do i 
 
 Malt per bushel..] 
 
 Oils: ; 
 
 Coal and kerosene, distilled, »fec . . per pfal . . 1 
 
 Crude petroleum do : 
 
 Spirits: j 
 
 IJrandy. rum, whiskey. &C per gal--j 
 
 (proof liy iSykes's hydrometer. ) ! 
 
 Cordials, Ac 
 
 Sucar and confectionery '< 
 
 Id 00 { 
 
 2 00 ( 
 J 
 
 rerfumcry, fancy soaps, proprietary niedi- 
 cines, ».Vc. 
 
 Leather, -sole and upper 
 
 Books, (fjeiuMally) 
 
 Iron, (certain kind ) 
 
 Type 
 
 Tobacco, (manutactured,) except cij^ars, and 
 including suulV. • 
 
 Rice . . 
 
 Wines 
 
 ooj 
 04 
 
 o;? 
 
 y 00 
 
 4 00 
 
 5 00 
 
 6 00 
 01 
 01 
 01 
 40 
 
 I.') 
 OtJ 
 
 80 
 
 1 -20 
 '25 per cent, and spe- 
 citic duty ot tiom I 
 cent to I- cent jiei lb 
 *Jr> per cent, ad valo- 
 rem. 
 
 10 per cent. 
 
 ;') per cent. 
 
 f) per cent. 
 
 5 ])er cent. 
 
 f) per cent, and sjie- 
 
 ciric tif 15 cents per 
 
 pound. 
 
 15 per cent. 
 20 per cent, and spe- 
 citicof 10 cents per 
 gallon. 
 
 15 per cent, ad valo- 
 rem. 
 
 |0 04 
 
 o:{ 
 
 3 00 
 
 4 110 
 
 5 00 
 
 6 00 
 01 
 01 
 01 
 40 
 
 10 
 
 06 
 
 80 
 
 I 20 
 
 Formerly specilic. 
 
 iSame as now. 
 
 Same as now. 
 
 Free. 
 
 Free. 
 
 15 per cent. 
 
 Free. 
 Formerly specitic. 
 
 The free list is very extensive, including drugs, dye-stuffs, paints, (dry 
 used in manufacturing. 
 
 3h . 
 
^fr 
 
 mUUMiiikl Mlkn^m WITH C^AS'AbA. 
 
 1 
 
 Certain iiiaimfactures and products of manufacturea areadniittod free 
 of duty, with a vi(^w to the eiieourafteineiit of other injuiufaetures, ship- 
 biiildiiiju;-, raihoads, &c. Several of tliese articles, heretofore cliarged 
 with duty, are now exempt. 
 
 P'RiiE-CActofMay, 1868.) 
 Anchors. 
 
 Boltlllfr cldtll. 
 
 Cotton wool. 
 
 Duck for Ixjltinp- and liose. 
 
 Felt for hilts iiud lionts. 
 
 J^'ire eiipiru's, (sfcain,) iiiiportod for use of municipalities. 
 
 Macliincry, (with c. jcptions.) 
 
 Mttiils : 
 
 linis.s — bar, rod, shoet, and scrap. 
 Cranks for stcaiuhoats. forjrcd in the ron<:;h. 
 Crankn for mills, fori,''e<l in the routrh. 
 
 Cop] er — in pip, bars, rods, h(dts, and sheets, and sheathing. 
 Iron ot the descriptions following: 
 Scrap, galvanized, or jiig. 
 I'liddled, in bars, blonms. and billets. 
 I5oits and siiiUes. i^alvauized. 
 Locomotive engine frames, axles, cranks, hoop iron or steel for tires of wheels, bent and 
 
 welded. 
 Locomotive crank nxle^, piston-rods, guidu' and slide bars, crank pins, connecting rods, 
 l^ead in slu-et or j)ig. 
 Litiiarge. 
 Kailroad bars and frogs, wrouglit iron or steel chairs, wrought iron or steel fish plates, 
 
 and car axles. 
 Sliafts for mills and steamboats, in the rough. 
 ►Spelter, in hli'cks, slieiU or jiii:'. 
 Steel, wrought or ca^t, in bars and rods. 
 Steel plates cut to any fonii, hut not moulded. 
 Tin, in bar, blocks, ]iijr, or grumilated. 
 Tubes and piping, of brass, copper, or iron, drawn. 
 Type metal in blocks or ])igs. 
 Wire, of In ass or copper, ronnd or flat. 
 Yellow metal, in bolts, burs, and for sheathing. 
 Zinc, in sheets, blocks, and pigs. 
 Nails, composition or sheathing. 
 Oakum. 
 
 Piinting inks, and presses, except portable hand-presses. 
 Prunella. 
 
 Plush, for hatters' use, 
 Kags. 
 Shi])s' biniuicle lamps. 
 
 blocks and patent bushes for blocks, 
 bunting. 
 
 cables, iron chain, over half an inch, shackled or swivelled, or not. 
 com])asses. 
 dead eyes, 
 dead lights. 
 deck pings, 
 knees, iron. 
 
 masts or parts of, iron. , 
 
 pumps and pump-gear, 
 riders, iron 
 shackles, 
 sheaves. 
 
 signal lamps. » ^ 
 
 steering apparatus, 
 travelling trucks, 
 wedges, 
 wire rigixing. 
 And the following articles, when used for ships or vessels only, viz : 
 Cables, hei.ip and grass. 
 Cordage. 
 
 Sail-clotli or canvas, from No. 1 to No. 6. 
 Varnish, black and briaht. 
 
p admittod free 
 ifaclures, sliip- 
 tofore charged 
 
 wlieels, bent and 
 counectiiijT rods. 
 
 stool fisli plates, 
 
 COMMERCIAL RELATIONS WITH CANAD^ 
 
 /' ^^*Va?4^™'^"''J'" S'^r^"'^"^^ ''''^ admitted free of duty under the a«t 
 of May, 1808, many lower duties having been repealed. Among them are : 
 
 Broom corn. 
 Coal and coke. 
 
 Ejrg's. 
 
 Flour, wheat, and rye. 
 Fire-wood. 
 
 Fish, fresh (not excluding oysters, &c., in cans or kees.) 
 
 V urs, (uiulressed.) ^ ' 
 
 Grain, of all kinds. 
 
 Hay. 
 
 Hemp, (undressed.) 
 
 Hides. 
 
 Hops. 
 
 Horns, 
 
 Indiai) meal. 
 
 Knots, 
 
 Salt. 
 
 8o',m1s. 
 
 Tar and turpentine, (except spirits of turpentine.) 
 
 J 10 OS. 
 
 Von-otulil(>s, (culinary ) 
 
 Wood of all kinds, ("unmanufactured.) 
 
 Wool. 
 
 EXPORT DUTIES, 
 
 Shinerlo l)o]t.sporcord of 128 cubic foot. a;i nn 
 
 Stave holts per cord (if 1 -js cubic tVot ^j [. 
 
 Pine and oak locr.s per J,(JU() ,, ' 
 
 Spruce logs per l,(k/U .'; ^ ^^ 
 
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