^4I^^ 
 
 / 
 
 EXPORT DUTY ON RAW COTTON, 
 
 AND FREE TRADE IN 
 
 COTTON FABRICS, 
 
 THE TRUE POLICY FOR THE 
 
 SOUTHERN CONFEDERACY; 
 
 CHARLESTON : 
 
 PRINTED BY. A. J. BURKE, 40 BROAD-STREET. . 
 1861. - 
 
AN 
 
 EXPOUT DUTY ON HAW COTTON 
 
 AND FREE TRADE IX 
 
 COTTON FABRICS, 
 
 THE TRUE POLICY FOR THE 
 
 SOUTHERN CONFEDERACY. 
 
 CHARLESTON : 
 
 PRINTED BY. A. J. BURKE, 40 BROAD-STREET. 
 1861. 
 
Digitized by the Internet Archive 
 in 2011 with funding from 
 Duke University Libraries 
 
 http://www.archive.org/details/exportdutyonrawc01char 
 
#3r 
 
 Ax Export Duty ox Raw Cottox, axd Free Trade ix 
 CoTTOx Fabrics, the True Policy for the Southerx 
 
 COXFEDERACY. 
 
 An error, which has been suffered, unchallenged, to gain 
 upon behef, and acquire the sanctity of a principle, in the 
 sacred college of truth, like the hypocrite in social life, 
 is apt to exhibit a livelier indignation and resent more vio- 
 lently, any approach to a candid scrutiny, than the soul 
 of sincerity itself. Of this temper, I fear to be the pre- 
 vailing notions respecting the nature and operation^ of 
 a duty on exports, considered more especially in its rela- 
 tions to the faculties of the new government now established 
 under a Southern Confederacy. Since the time of the 
 younger Pitt, when the principle of an export duty on "pig 
 iron," was stigmatised in the debates of Parliament, "as 
 a barbarism in finance," no one seems to have been disposed 
 to question the truth of the dogma, but like an action for 
 a "sum certain," it has gone " by default" for the want of a 
 plea, without even a "writ of inquiry." And the judgment has, 
 with singular energy, executed itself on this side of the Atlan- 
 tic by a negative condemnation, in the practice of the Govern- 
 ment from its origin. The fact, however, is less surprising, and 
 reflects nothing of discredit upon the public intelligence, when 
 it is considered, that the principles of finance in favor Avith 
 the old government, looking to protection rather than 
 revenue, necessarily excluded from theoretical discussion, or 
 practical exemplification, any system for raising the national 
 revenue, supposed to be inconsistent with that object. And 
 hence the utter ignoring of any other method, than that of duties 
 on imports, well understood in its efficiency to that end. The 
 political revolution, however, through which we have passed, 
 would fail to yield its most substantial benefits, if it does not 
 
'bring with it, a thorongli determination in the general mind t© 
 go back to first principles, in all that relates to the civil organiza- 
 tion, and resolutely to consult no other oracle than reason, 
 guided by experience, in the reconstructing of every part of 
 the administration. It is impossible that so great and radical 
 a change in our external relations, should not create a neces- 
 sity for other changes as signal, in the internal administration. 
 And it is my purpose in the following observations thrown to- 
 gether hastily, though not without some reflection, to endeavor 
 something, towards drawing the public attention, and particu- 
 larly the notice of the authorities at Montgomery, to a prom- 
 inent change in the system of revenue, which, in my judgment, 
 is at this time urgently demanded by every principle of 
 domestic economy, commercial prosperity, and foreign policy. 
 
 Duties on imports have so long been regarded as the only 
 practicable method of providing the public revenue, that a 
 proposition to repeal them, will in the minds of most people, 
 imply a stoppage of supplies altogether, at the only source capa- 
 ble of yielding them. In all discussions hitherto, none but 
 the direct taxation men, have ever proposed to abolish im- 
 port duties altogether. The only question has been, whether 
 the principle of revenue, or protection, should govern the 
 scale. Perhaps in the old Union, encumbered as it was with 
 an immense amount of manufacturing capital, which had been 
 put upon its legs before it could walk, and required to be pre- 
 served from falling, such an idea would have been, perhaps, 
 justly regarded as impracticable, and hence received no atten- 
 tion. But very different is the situation of the new Confedera- 
 cy. With no excrescences of this nature in the body politic, to 
 compel a departure from the principles of sound economy, 
 and entering upon a national existence in some respects pecu- 
 liar and unprecedented, it is the very time and place for a 
 careful scrutiny, into every thing pertaining to the future policy 
 of the new government, taking nothing upon trust from the 
 old. 
 
 Indeed, the necessity will meet the Southern statesman at 
 every step in framing the new order of things to recur to first 
 principles, rejecting old and adopting new methods with equal 
 facility, according as they shall be suitable to our altered politic 
 
eal relations. I am happy in believing, moreover, that the peo- 
 ple of the Southern Confederacy are at this juncture pecuharly 
 fortunate in the character of the men, charged with the pow- 
 ers of government at Montgomery. Selected as they were, 
 by Conventions of the respective States, and at a crisis of 
 affairs which brought into requisition the best talents in the 
 country, it is not too much to expect, that they will be fully 
 equal to the bold and delicate task, of revising or reversing 
 old systems, retaining what may be useful or appropriate, 
 but discarding with relentless severity every thing mischiev- 
 ous or flilse, however consecrated under the forms of long 
 established usage. In this confidence, I deem it not inappro- 
 priate to throw together, some reflections upon a subject that, 
 at the outset, must occupy the attention of the new govern- 
 ment, as one of paramount importance. Taxation is a topic 
 which has at all times, and ever must continue to occupy, 
 principally, the thoughts of every people ; as it is chiefly 
 through that part of the machinery of government, 'that the 
 citizen is affected for good or evil, and the operation of which, 
 goes far to determine his status in the scale of civil liberty. 
 
 Particularly interesting is the subject to us at this time, 
 entering as we are upon a new national career, with a tabula 
 rasa, to inscribe what characters we please, and terribly admon- 
 ished by experience that it is a sea abounding in perils, 
 and demanding the best skill of the navigator, to keep 
 clear of disaster. Without pretending to be a Pahnurus, 
 I shall proceed with a very shallow line and plummet to take 
 some of the soundings along the shore. 
 
 It is estimated that the newgovernment, comprising the eight 
 cotton States, (Arkansas included,) will need twenty millions of 
 revenue to carry on its operations. The question is, how shall 
 this be raised ? The government must have it, and somebody 
 must pay it. There are three alternatives, (laying out of view 
 direct taxation.) Shall we continue the old system of exporting 
 duty free, and laying a tax upon imports ? or shall we lay a 
 duty on exports, additional to the duties now subsisting on 
 imports ? or shall we adopt the only other alternative, of 
 substituting an export duty upon raw cotton, for the existing 
 import duties upon the cotton fabrics? In my judgment, 
 
6 
 
 tlie last is the scheme, which can bo demonstrated to be the 
 only one founded in true revenue and commercial principles^ 
 and if adopted as the fiscal policy of the Southern Confed- 
 eracy, will be speedily followed by the most striking results, 
 as well in its economical efficiency, as in its effects upon the 
 general commerce of the country. In this belief, I propose 
 to show — 
 
 First : That an export duty, not excessive, say one cent 
 per pound upon the cotton crop exported, yielding the twenty- 
 millions needed by the government^ will fall principally, if 
 not wholly, upon the consumer of the fabrics, and not the 
 producer of the raw material. 
 
 Secondly: That nine-tenths of a revenue so raised, will fall 
 upon foreign nations, one-tenth only being paid by our own 
 citizens. 
 
 Thirdly : That the tenth part falling upon our own citizens, 
 will be supplied, by paying into the treasury, only two dollars, 
 instead of the twenty-four now levied upon the domestic con- 
 sumption of all imported articles of cotton fabric. 
 
 And, Fourthly : The commercial effects of such a policy, 
 adopted by the Southern Confederacy, would be, speedily to 
 abolish the whole system of import duties in all the States, 
 and throw open the entire American market to free trade in 
 cotton manufactures, the object of a forty years successless 
 struggle in the Union. 
 
 The first question is, who will pay the tax ? All writers, 
 a,nd, I believe, all intelligent commercial men agree, that a 
 tax laid upon any article of commerce, must sooner or later, 
 settle itself in one of three ways — either upon the producer, 
 or the consumer, or it must distribute itself between the two. 
 There is an equal concurrence in the principle, that the con- 
 dition of the market for the particular commodity, as deter- 
 mined by the relation of demand and supply, of the article 
 taxed, will in great measure, if not altogether, determine 
 which of these directions the tax will take. If the consump- 
 tion be strong, and growing upon the production, it is conce- 
 ded the tax will settle upon the consunier. If, on the 
 contrary, the production be in excess, and the demand con- 
 sequently feeble, it is considered equally certain, that any 
 
addition to the charges would fall upon the producer. Again,- 
 in a third state of the market, when supply and demand are 
 pretty Avell adjusted, neither encroaching upon the other, 
 producing Avhat merchants call a healthy market, of uniform 
 prices, tending strongly, neither downwards or upwards, such 
 a tax by general consent, will divide itself between the buyer 
 and seller, in proportions certain in themselves, but not posi- 
 tively ascertainable, b}" any method of analysis yet known to 
 political economy. It may be safely affirmed, however, that 
 it is a varying proportion, fluctuating with the changes in the 
 tone of the market. 
 
 If these be acknowledged principles, then the question in 
 relation to the export duty proposed, resolves itself into one 
 of simple fact, about Avhich the whole intelhgent world is 
 capable of judging, and has, and is daily, in every form of expres- 
 sion, declaring its testimony. "Which of these three condi- 
 tions, is, the actual, and normal one of the cotton market of the 
 world ? Every merchant knows. Every newspaper report 
 of prices current declares it. The cotton spinning associations,- 
 and the cabinets of Europe treating the fact as one which has 
 assumed the magnitude of a political question, all proclaim, that 
 the consumption of this wonderful staple, is not only now, in 
 advance of the production, but the growing disparity between 
 the two, is destroying the equality of commercial values, 
 and threatening universal calamity. 
 
 I assume then, as an indisputable fact, that the condition of 
 the cotton market, now and henceforward, so far as human fore- 
 sight can penetrate the future, is such as will, upon ackno^vl- 
 edged principles, governing the operationsof trade, throw the 
 duty upon the consumer : provided, however, (and this brings 
 us to the qualification contained in the proposition,) that the' 
 duty laid be not excessive. Would a duty of one cent per 
 pound upon raw cotton be liable to this objection ? It could 
 only be so by adding so largely to the price of the fabrics as 
 materially to curtail consumption ; for by the argument it is 
 thrown exclusively upon the consumer. Let us consider, in 
 a general way, how this stands. We do not aim at arithmet- 
 ical precision ; general truth wiU serve for the illustration of 
 
8 
 
 the principle. I will engage, however, that any departure from 
 exactness shall be against the argument. 
 
 It is well known, that a pound of raw cotton, in the various 
 processes of manufacture, acquires a value, from three times 
 to twenty times its original cost, according as it is converted 
 into the coarse or finer fabrics. One cent per pound upon 
 the raw cotton, being about nine per cent of its present value, 
 would enhance the price of a fabric, worth thirty three cents 
 to the pound, not more than three per cent.; and a fabric 
 worth two dollars to the pound, as a vast variety undoubtedly 
 are, would not be enhanced more than one-half of one per 
 cent in value. All articles of intermediate value, would be 
 enhanced more or less, according to the position they might 
 occupy upon the scale, between these extremes. The average 
 increase of price, upon the whole mass of cotton fabrics of all 
 descriptions consumed, in ths markets of the world, would not 
 exceed two per cent., about the mean between the highest 
 and lowest limit above stated. The question here occurs : 
 could so slight an advance in the price of cotton fabrics, mate- 
 rially check a consumption, confessedly vigorous and growing 
 in intensity, so as to curtail in any appreciable degree, the 
 demand for the raw material ? 
 
 This question will be better answered after considering 
 another, viz : In what class of fabrics would this advance in 
 the price be most likely to take place — in those varieties 
 denominated luxuries, or in the coarser descriptions consumed 
 by the poorer classes ? For it is an admitted principle among 
 economists, whether practiced as an art at the counter, or 
 delivered in speculation from the chair, that articles of luxury 
 will bear taxation in much higher degree than articles of 
 necessity, without checking consumption. The reason is 
 plain. The cravings of fashion and caprice are as importunate 
 as those of necessity. The difference is, that in the one case, 
 there is abundance of means to gratify them, in the other un- 
 happily not so. Hence the addition of a few cents, more or 
 less, to the price of the finer fabrics, calculated as they are 
 for an affluent market, is but little felt, and not regarded. 
 Not so with the coarser fabrics. Such articles are, to a great 
 extent, intended for a market of narrow means, already strained 
 
to its utmost by existing prices, any addition to whicli must 
 of course be met by the contrivances of poverty, for econo- 
 mising consumption. The question recurs : to v/hich of these 
 classes of fabrics will the tax attach itself. Let us consider 
 this a little in detail. The bulk of the finer cotton fabrics 
 range from twenty-five to thirty-seven and fifty cents a yard, 
 the most expensive varieties reaching a much higher value. 
 The finer the fabric the greater number of yards, as a general 
 rule, to the pound weight. The number of yards to the 
 pound will run (keeping within average limits,) from three to 
 ten ; in some varieties, less, in a greater number, more. Take 
 an article Avorth thirty-seven cents a yard, requiring, as most 
 articles of this quality are likely to do, eight yards to the 
 pound weight: it is evident, that the pound of cotton, which 
 has been converted into this fabric, has assumed a value of 
 two dollars ninety-six cents ; and if it advances no more in 
 price than to restore the one cent imposed upon the original 
 pound of raw cotton out of w^iich it was manufactured, the 
 additional cost to the consumer will be expressed by adding 
 one cent to every two dollars ninety-six cents w^orth of the 
 article he buys, and so on through the whole scale of the 
 great variety of fabrics. I have selected this instance as a 
 medium one, for the purpose of illustration ; but we will take 
 two other examples, nearer the opposite extremes of the 
 scale. For instance, fabrics worth eleven cents a yard, and 
 requiring three yards to the pound, would be enhanced in 
 the market one-third of a cent a yard, or one cent upon the 
 pound value, being three per cent upon the consumption. 
 On the other hand, an article worth fifty cents a yard, and 
 running ten, as some do fifteen or twenty yards to the pound 
 weight, it is manifest, that the cent imposed upon the raw 
 material is lost in the attempt to trace it, and resolves into 
 an infinitesimal quantity, as to any effect it can have upon 
 price, or in reducing consumption. 
 
 These principles, practically understood by every retail 
 dealer, in cotton fabrics of the different varieties, what 
 will be his method of recovering the one cent per pound 
 from his customer, the consumer? Will he commit the- 
 blunder of putting any part of the tax, small as it is, upon- 
 2 
 
lo 
 
 the coarser fabrics, where it will be immediately felt, and 
 to that extent curtail his sales in them ? or will he make 
 the class of finer fabrics bear the tax, distributing the whole 
 tax among the varieties that Avill not feel it, and thereby pre- 
 vent a reduction of his business in the coarser articles? His 
 economy is too plain to be mistaken. And this developes a 
 feature of the system, by no means the least valuable. 
 No system of fixed taxes, such as the existing tariff, how- 
 ever fiLiithfally graduated, and discriminative in its efforts, 
 to throw upon each article, just so much tax as it will beary 
 without reducing consumption, (the strictly revenue principle,) 
 can ever do more in practical operation, than approximate to 
 its own principle. The difficulty is intrinsic. The scale is 
 inflexible, the ability of consumption infinitely and perpetually 
 variable. The means adopted to effect the end, are as 
 inadequate and intrinsically unfit, as would be a yard or an 
 ell for the measurement of a running fluid, and as impossible 
 to be exact, as to establish an equation between a given and 
 a shifting quantity. Those fiimiliar with the details, in this 
 branch of the public administration, understand the truth of 
 this perhaps better than I do. It is admitted, however, by 
 all intelligent statesmen, that the chief, if not the only test of 
 the merit of any scheme of finance, is the degree in which, in 
 its practical results, it effectuates this principle. If, then, 
 the retail merchant, exercise his trade with, the discriminating 
 intelligence above supposed, distributing the export duty, 
 upon the various fabrics he sells to his customers, just in pro- 
 portion as he perceives will meet the ability and willingness 
 of the consumer, have we not here a tax levying itself, upon 
 a self-adjusting principle, by force of the laws governing the 
 operations of trade, as exactly conformable to the standard of 
 theory, as can possibly be conceived? Every retail merchant 
 is converted into a tax collector, not inexorably levying an 
 inflexible tax, the nature of all fixed scales, but making it his 
 chief stud}^, as it is his interest, and the very art of his trade, 
 to measure the exaction, to the ability of the tax payer, and 
 accommodate its collection to his convenience; thus realising 
 the perfect standard of theory, viz., a variable scale of duties, 
 in exact sympathy with every fluctuation in the means and 
 ability of the consumer. 
 
11 
 
 We are now prepared to answer tlie question above de^ 
 ferred. Will a direct tax of two per cent upon the consump- 
 tion of the world, shifting itself, as we have seen this will 
 inevitably do, from all articles which would be distressed by 
 the additional burden, upon those descriptions, which Avould 
 neither be materially enhanced in market price, nor with- 
 drawn from the reach of the affluence that consumes them, 
 be excessive, or operate such a reduction of the consumption 
 of cotton fabrics in the aggregate, as to react sensibly upon 
 the value of the raw material. If the foregoing facts and 
 reasoning are not delusive, the question is already answered. 
 
 If, then, we may assume it as reasonably establislied, that the 
 duty in question will shift itself upon the consumer, our second 
 proposition, that nine-tenths of the entire revenue levied upon 
 this principle will fall upon foreigners, and the remaining 
 one-tenth only upon our citizens, will prove itself by a 
 very simple statement of facts. It is estimated that the 
 whole cotton crop exported, worth in the raw state two 
 'hundred millions of dollars, by conversion into the various 
 fabrics, acquires an increase of five times its original value, 
 giving an aggregate value of one billion of dollars in the 
 shape of manufactures annually consumed in the markets of 
 the world. Of this enormous amount, not more than one^ 
 tenth, as near as can be computed, comes back for consump^ 
 tion into the States (Arkansas included) composing the 
 SoutherQ Confederacy, making an import of one hundred 
 millions. In this proportion, then, must all revenue de- 
 rived from such a source, divide itself as between the citi- 
 zens of the Confederacy and foreign nations. The home 
 consumers pay one-tenth of the whole, and all the rest of the 
 consuming world the other nine-tenths. Two per cent, upon 
 the whole consumption, foreign and domestic, gives exactly 
 the twenty millions, two milHons of which only are drawn 
 from our own citizens. But this is not all ; the tenth part 
 drawn from the home consumer will be vastly more than 
 restored to him by the repeal of tiie existing duties upon the 
 same articles. The enormous diHerence between twenty-four 
 per cent., the existing duty, and two per cent., the effect of 
 the export duty, will be the measure of saving upon all articles 
 
12 
 
 of consumption, and the result will exhibit the singular specta- 
 cle, paradoxical as it may seem, of a treasury supplied, over- 
 flowing" with revenue, and the people growing richer by 
 every act of contribution. By the change proposed, it is 
 clear, that for every two dollars taken from the citizen by the 
 indirect operation of the export duty, twenty-four will be 
 remitted to him, now exacted directly under the import 
 system. 
 
 The commercial effects of such a policy, apart from its 
 features, as a scheme of finance, would soon exhibit themselves 
 in a manner not less striking. The opening of the Southern 
 ports under a system of free trade, would speedily force upon 
 the maritime States of the North a similar policy. They 
 would have to elect, and that promptly, between an entire 
 loss of their foreign trade, or a compliance with our example. 
 It would be impossible, without ruinous expense, to keep up 
 a system of custom collection upon the border line, that would 
 effectually prevent so light and costly a class of merchandise 
 as cotton manufactures, imported under the free trade system, 
 into the Southern Confederacy, from penetrating every part 
 of the North and North-west. The very streets of Boston 
 and New-York would be thronged with fabrics purchased in 
 Charleston and New-Orleans. It is not difficult to foresee, 
 that in an incredibly short time, the whole American market, 
 would be thrown open to free trade with the world. If so, 
 then how does it stand with the planter, who may still have 
 a lurking apprehension, that some fractional part of the export 
 tax may fall on him ? Grant, for the argjument, that some 
 part, nay, the whole of it, does ; what effect does he suppose 
 such an expansion of a market, consisting of thirty-five mil- 
 lions of the best consumers in the Avorld, accompHshed, as it 
 only can be, by the application of an export duty, will have 
 upon the price of the raw material ? The answer, as before 
 shown, is expressed in the ratio between two and twenty-four. 
 The effect upon the value of the raw material, must be just 
 so much as is to be expected, from taking off twenty-two dol- 
 lars from every hundred, dollars of price for the fabrics in so 
 rich and populous a market. "What this would be upon the 
 pound, it is impossible to know precisely. It must be left to 
 
13 
 
 those most conversant with the subject, to say, whether it is not 
 reasonably certain, that it would at least restore the export 
 "duty thrice over. If the foregoing views be not delusive, 
 then it is certain that a tariff upon the cotton exports, is not 
 ^lone, the only tariff that can be devised, practically to execute 
 the revenue principle, but that it exhibits a feature in prac- 5^ . ^ 
 
 tice, more perfect than theory, viz., a method of taxing con- 
 sumption, without curtailing it. 
 
 But there is another view to be taken of the question. A 
 system of finance resting upon this principle, is the great 
 lever placed in our hands, by the natural advantages of our 
 situation, whereby at this critical juncture, we may lift our 
 national existence into an early recognition among foreign 
 powers, and acquire at once the importance which we know 
 belongs to us. The revolution thus suddenly forced upon the 
 -commerce of the country, would do more, and in less time, than 
 armies and navies, to bring our Northern neighbors to a just 
 sense of the relative strength of the two Confederacies, and 
 teach foreign nations, in a way too striking to be ignored, at 
 which end of the old Union, they will find their assuidity the 
 most amply rewarded. The temporary echpse we are now 
 suffering in the eyes of Europe, consequent upon the recent 
 dissolution, will soon give place to the discovery, that not we 
 but it is themselves, that are under the shadow. 
 
 It is not my purpose to descant, upon the effects such a 
 pohcy, adopted by ourselves, would have upon Northern in- 
 terests. Believing, that so long as peace subsists, every 
 nation is interested in the wealth and prosperity of every 
 other nation, I would be glad to perceive, if such are to be oui: 
 relations, a more hopeful prospect for our neighbors than I 
 am permitted at this time to discover. How their immense 
 manufacturing investments are to flourish under free trade is 
 a problem. This much, however, I certainly know : they 
 must either come down with a crash, or the great majority of 
 the people of the United States, have for forty years been 
 swindled, upon a scale more gigantic than the South Sea 
 bubble or the old National Bark. We are further permitted 
 to know, that with the repeal of import duties at the North, 
 comes the only other method in their power of raising reve- 
 
 ^"^ 
 
14 
 
 nue — direct taxation. And if -'guns and drums," and 
 •" brave hosts with banners flying/' are to be the role on which 
 they mean, now, or hereafter to enter, the supphes for the 
 costly pastime, must be drawn directly from their lands and 
 goods. At this expense, we have been taught to believe, 
 Jonathan ?ieyer buys his whistle. We have spent our national 
 pupilage at school with him, and ought to know something of his 
 nature. We have slept with him, (in our own bed,) ate with 
 him, (at our own board,) and taken many a thrashing for the 
 mendicant in the winding up of a scrape, instigated by his own 
 rascality, from which he ever contrived to escape. Who ever 
 heard of ^ Solomon swapping a Hawk for a Hernshaw ? The 
 taint of fanaticism fetched from old Barebones, is more than 
 qualified by a sense of the practical, and no bigot in the world 
 is less likely to be betrayed into the thriftless example of the 
 honest old crusader, of selling his patrimony for Christ's sake, 
 to equip an expedition against the infidel. 
 
 In conclusion, the adoption of the system proposed, w^ll not 
 only save half the expense now attending the collection of 
 the customs, but will obviate the vastly greater expense that 
 will be pecessary in our new situation, to protect the revenue 
 against ruinous frauds. The alteration! in our political geo^ 
 graphy by the recent dissolution of the Union, gives to the 
 Southern Confederacy a border line, extending from the sea 
 coast to the Western extremity of Texas, upwards of one 
 thousand miles in extent. It is palpable, that under a system 
 of import duties, all articles from the North entering into 
 domestic consumption, now constituting a very large pro- 
 portion, would, if encountered at the sea-ports by the Custom 
 House officer, attempt to find their way to the market across 
 this hne. To prevent this, it would be necessary to establish 
 along its whole extent, a system of custom houses and mili- 
 tary stations, the expenses of which would devour another 
 revenue, in raising one for the government. And after every 
 precaution, it has been the experience of the world that 
 frauds, to a greater or less extent, would be successful. In 
 situations much less favorable to smuggling, and much better 
 guarded by nature and administrative appliances than ours 
 can ever be, it has been found that ingenuity and daring, 
 actuated by cupidity, will ever devise means to elude the 
 
15 
 
 vigilauce of the government. Among a people like ours,- 
 unused to such institutions, and educated to regard them as 
 the symbols of despotism, the attempt to enforce the law,- 
 necessarily severe as it must be, against smuggling, would 
 lead to insurrection and blood-shed on both sides of the line,- 
 and finally, in all probability, terminate in war with our 
 neighbors. But after every precaution taken, and all the 
 risksincurred, it would be rendered impossible, by geographical 
 obstacles, the sameness in the language, and physical features 
 of the people, and their singularly adventurous character, to 
 protect the revenue from ruinous frauds. And what would 
 be the effect upon the character of our people, and the em- 
 poriums of trade in the Southern Confederacy, of illicit traffic, 
 systematically carried on, to any extent in the interior ? It 
 would demoralise the national character, beget a habit of 
 disloyalty, and secret hostility to tlie civil authorities, intro- 
 duce a spirit of lawlessness, and reckless contempt of law and 
 morality, that would soon terminate in a general and open 
 defiance of the government, and a relaxation of all the bonds of 
 organised society. The cities would languish in their trade, 
 recede in activity and wealth, and be depopulated ; and busi- 
 ness in all legitimate employments, be visited with distress and 
 bankruptcy. Such would be the inevitable consequences of 
 an attempt by the government of the Southern Confederacy,- 
 to levy the public revenue upon the principle of duties upon 
 foreign imports, unless indeed, we mean to put the North, on 
 the privileged footing, of free trade in commercial intercourse.- 
 But this Cannot be done, without sacrificing much the largest 
 part of the revenue. If, then, nothing else in the foregoing 
 views were correct, except this that relates to the point of 
 smuggling, it would seem to be practically futile, to attempt to' 
 raise the public revenue, by any system of duties on imports.- 
 It follows, that as revenue must be had, some other method 
 must be resorted to. There is no choice but between direct 
 taxation and an export duty. And though I am not one of 
 those who scout direct taxation, when compared in its merits 
 with the system of import tariffs. I am yet fully persuaded, 
 taking the views hitherto expressed of the wonderful econ- 
 omy of the principle of export duties, its adaptation to- the 
 
16 
 
 circumstances and situation of the Southern Confeclerac)^. 
 and the ability of the revenue, raised upon this principle, to 
 protect itself without the aid of armies or custom houses, that 
 it is, and always must be, the great policy of the South. In- 
 deed, I regard its speedy adoption by the administration at 
 Montgomery, as urgently demanded, in the still dubious rela- 
 tions of the country, if we mean to maintain in good faith^. 
 and with a resolute will, our separate existence as an inde- 
 pendent nation. 
 
 CORRECTION. 
 
 Estimates received through a House of character and intelligence 
 liere, from tl»e best sources in New York, in connexion with informa- 
 tion derived from statistical documents, consulted since the publication 
 of the foregoing pages, reduce the consumption of cotton fabrics, in 
 the Slates now constituting the Southern Confederacy, from one hun- 
 dred to fifty millions annually. The effect of this, if the reasoning of 
 the pamphlet be just, is manifestly a corresponding reduction in the 
 proportion of the revenue drawn from our own citizens, making it one 
 million instead of two, thus throwing nineteen-twentieths of the support 
 of government upon foreigners* 
 
 NOTE 1. 
 
 It will be perceived that the plan, as delineated in the foregoing ■png'e^ 
 does not contemplate a repeal of any class of import duties, other thao 
 those upon cotton fabrics. This limitation, is not because the writer is' 
 not in favour of the importation of all articles of consumption, duty 
 free. But no further encroachment upon the existing system wa& 
 necessary to exhibit the practical working of the scheme proposed, as sn 
 system of finance, (to its best advantage.) Without any repeal, however,. 
 the method proposed, would be in6nitely more economical than the 
 present system. All other duties are left untouched, for the wisdom of 
 the occasion, either to repeal or continue upon a reduced scale, in aid 
 of that derived from the export duty. It is manifest, that a very low 
 scale would furnish any deficit now or hereafter. 
 
ADDENDUM. 
 
 Since sending tlie foregoing to press, Mr. Lincoln's inaugu- 
 ral has appeared, and calls up another consideration connected 
 with this subject. Its tone and implication seem to look to 
 coercion, in a way that sliall not, in his estimation, according 
 to the standards of his nurture, bring on, or justify resistance 
 by bloodshed. It would seem, therefore, to contemplate the 
 collection of the revenue on the bar, in armed vessels, if any 
 significance is to be attached to the twaddle, about his unwil- 
 lingness to thrust upon the community Federal officers, obnox- 
 ious to its prejudices. How effectually does the export duty 
 baffle the impotence of any such attempt ! The duty having 
 been collected, and paid into the Treasury, and the property 
 passed into foreign hands before taking the water, all the 
 navies in Christendom, stationed at the bar, could not defeat 
 the government of its revenue ; and the worst that could 
 befall, in a pecuniary estimate, if the duties on imports should 
 for a time be successfully enforced, would be to elevate the 
 price in the domestic market, two per ce:it upon all articles of 
 strictly foreign import, (their own principles, exempting 
 of course their own manufactures,) not constituting one-third 
 of the domestic consumption. The result would be a tax of 
 twenty-six instead of the existing twenty-four per cent upon 
 one-third of the consumptionof the Southern Confederacy. 
 
 So small an enhancement of cotton fabrics in the markets 
 of the Confederacy, shifting itself, as before shown, upon the 
 varieties of luxury, would occasion little distress or inconve- 
 nience to the citizen, and if persisted in, as a system of 
 passive warfare, would prove itself vastl}^ more expensive to 
 its managers, and provocative of disputes with foreign 
 powers, than effectual for any purpose of coercing the sover- 
 
eign will of the Confedei'acy. Such a state of things, if 
 existing for any time, would afford a striking illustration of 
 the advantages of the principle of export duties, viewed as a 
 system of finance, adapted to the exigencies of war. The 
 government could supply itself with an abundant revenue, 
 impossible to be intercepted by the enemy, and the people 
 sustain themselves, without sensible injury, under a confisca- 
 tion of twenty-four per cent of the value of all foreign imports 
 entering into their consumption. 
 
 The only alternative then left to Mr. Lincoln, if he persist 
 in coercion, would be to abolish all ports of entry, and lay an 
 embargo upon the commerce of the Southern Confederacy ; 
 and in deference to the recent growl of the British Lion, 
 about paper blockades, as well as the undoubted principles 
 of the law of nations, it must be supported by a naval force, 
 adequate to maintain it upon the strictest principles of the 
 law of projectiles. But is it conceivable that England would, 
 or could long submit, to such an interruption of her com- 
 merce ? By a great effort of self-denial, not foreseing at what 
 moment, the growing power of France, may drive her for 
 shelter, to the protecting maxims of a code, which she has 
 seldom hesitated, under tlie temptations of interest, to violate 
 in her intercourse with weaker powers : under this constraint, 
 I say, England might, for a time, dispense with the South 
 as a market of consumption for her manufactures. But how 
 long will she submit to the imposition of an embargo, cutting 
 her off from the only market in the world for the purchase of 
 her cotton supplies ? She would be false to her history, aye, 
 and to the last and highest law of nations too, if the tomfoolery 
 of Mr. Lincoln and his Cabinet, under the silly pretext of 
 the chapter in the law of nations, treating of the rights of the 
 Sovereign to reduce his revolted provinces were not whistled 
 down the wind, and the government at Washington, gently, but 
 significantly, informed by Minister Lyons, that Grotius and 
 Puifendord invented their maxims before the era of cotton, and 
 that the revolted provinces, attempted fo be appropriated, are 
 like the sea, the air, the light of heaven, the common property 
 of mankind, from which no one proprietor can or shall exclude 
 
19 
 
 another. That though the word cotton, is not to be found in 
 the writings of those venerable sages, jet that the principle 
 governing the question, is written in characters of light in 
 every part of them. That the exclusion from cotton would 
 threaten the stabihty of half the thrones in Europe, and that 
 nature and nations declare that necessity is the highest law. 
 
 CENT-A-POUND.