. 1 Ü 19 Ii
\\ruM-tf- ci
THE RAILROAD QUESTION.
Dear Sir :—
The man who habitually retains himself in a position to be
obliged to seek for purchasers of his labor or its products rarely
fails to reap ruin as its result. He who, on the contrary, so places
himself as to be enabled to compel purchasers to come to him, finds
his power of accumulation increase with each succeeding year, and
ends with colossal fortune. The first is that one in which the
American people, guided by British agents, have always kept them¬
selves, and we have the result in a war that must have brought
universal ruin had it not brought with it also emancipation from
that British free trade policy whose effects are so well described by
General Jackson in the admirable letter already given. The second
is that in which the people of France, under a system of protection
maintained with a persistence that has no parallel in history, have
placed themselves. The whole world is compelled to go to them to
buy, and they fix the prices at which they choose to sell. The world
is compelled to go there to sell, and they are thus enabled to fix the
prices at which they choose to purchase. The result exhibits itself
in a most extraordinary increase in the value of lands and houses,
the figures of which I have seen but cannot at the moment find.
Well, however, do I recollect that they were of a character calcu¬
lated to excite astonishment even in one who had witnessed the
effect on western lands of a steady flow of emigration from the
East.
The first has been governed by that class of men of which Mr.
Secretary Walker is the type ; that class which proclaims that this
is naturally " an agricultural country," and that we must seek
abroad a market for our " breadstuffs and provisions"—thereby
so limiting our people in their modes of employment as to make
the country little more than a mere puppet in the hands of foreign
traders. The other has been, in this respect at least, governed by
1
2
men of whom the great Colbert is the type—men who have clearly
seen that national independence was to be achieved by means of
bringing the consumer to take his place by the side of the producer,
and thereby giving value to both land and labor. The results ex¬
hibit themselves in the fact that Prance now controls the move¬
ments of all Europe, while the people of this country, with natural
advantages a thousandfold greater, and almost as large a popula¬
tion, now find themselves compelled to abandon the Monroe doctrine
and fight for national existence—France, meanwhile, obtaining
command of our immediate neighbor, Mexico.
Shall we ever do better ? It may well be doubted. Often as our
farmers, our merchants, and our transporters have been "brayed"
in the British free trade "mortar," their "foolishness" has not yet
"departed from them;" and, judging from recent proceedings in
Congress, it would seem that, sad as has been our experience, they
are little likely even now to profit by it. Nothing, as it would
seem, can open their eyes to a perception of the great fact, that in
the real and permanent interests of the West and the East, the
North and the South, as well as in those of the ship-owner, the rail¬
road proprietor, the miner, the iron-master, the land-owner, and the
laborer, there is a perfect harmony, and that it is absolutely im¬
possible to injure any one of them without at the same time injuriously
affecting all the rest. Blind to this are they all, and, as a conse¬
quence of this it is, that we find western land-holders and laborers
combining with railroad managers for promoting the adoption of a
policy that each and every one of them would bitterly denounce
could he but be persuaded to pause a little in his course and study
carefully what had been the effect in the past of measures similar
to those whose adoption he now so earnestly advocates.
Of all, there are none who have shown themselves so blind to
their true interests as those same railroad managers. All experience
teaches that roads are profitable in the ratio borne by way to through
business, and unprofitable in the ratio borne by through to way busi¬
ness. Why is it so ? Because with the growth of this latter they
become independent ; whereas, with increase in the proportion borne
by through business they become more and more dependent. In
proof of this we may take the fact, that such has been the compe¬
tition for this latter that produce has, on many occasions, been
forwarded from Chicago to New York more cheaply than from
Buffalo, and more cheaply from this latter than from either Roches-
3
ter or Syracuse. In this manner they first offer bounties on emigra¬
tion from the older States, and then find themselves compelled to
enlarge their capital and extend their roads with a view to retain
their business. Common sense might, as one would think, teach them
that by aiding in the development of our great mineral resources
they would be creating a local traffic that could be carried on at
small cost and with great profit to themselves ; yet have they in¬
variably been found combining with British agents in opposition to
such development, thereby imposing upon themselves a necessity for
still further extension of their lines, with steady diminution in their
power to pay their stockholders.
Our railroad history covers a period of only five and thirty years,
and it may now be not unprofitable to cast our eyes back over that
period with a view to ascertain what are the lessons for the future
that may be thence deduced.
In 1832, the railroad interest insisted upon depriving our furnaces
of the manufacture of railroad bars. In the ten succeeding years
many roads were made, and all with British bars bought at the
highest prices. As a consequence the cost of roads was great, and
at the close of the free trade period in 1842 the railroad interest
was in a state of almost universal ruin. Why was it so ? Because
the road-makers had united with British traders in urging upon the
country a policy whose effect had been that of making them yearly
more and more dependent upon a through trade that could not be
made to yield a profit. The domestic market for food had been
greatly lessened, while that of Europe had failed to grow.
The tariff of 1842 imposed a heavy duty on railroad bars, and
then for the first time was their manufacture commenced on this
side of the Atlantic. Iron generally being well protected the pro¬
duction rose in half a dozen years to 800,000 tons, and the con¬
sumption to 900,000. Labor being everywhere in demand, im¬
migration trebled in that brief period. Towns and villages increased
in number and in size. The local traffic therefore grew, and railroads
became once more profitable to their proprietors.
Taking no lesson from experience railroad and canal owners
united in beating down protection, and giving us Mr. Walker's
free trade tariff of 1846. How they profited of this may be judged
from the following figures giving the receipts of some of the princi¬
pal works in the period from-1842 to 1849 :—
4
New York
Bait, and Ohio
Pennsylvania
Total.
canals.
railroad.
canals.
1842,
1,749,000
426,000
903,000
3,078,000
1844,
2,446,000
658,000
1,164,000
4,268,000
1846,
2,756,000
881,000
1,357,000
4,994,000
1847,
3,635,000
1,101,000
1,587,000
6,323,000
1848,
3,252,000
1,231,000
1,550,000
6,033,000
1849,
3,266,000
1,241,000
1,580,000
6,087,000
Under protection the receipts more than doubled, as here is shown.
As the British free trade system became more fully operative they
declined, thus presenting a striking commentary on Mr. Walker's
assertion, made but two years previously, that under a free trade
system " our own country, with its pre-eminent advantages, would
measure its annual trade in imports and exports by thousands of
millions of dollars."
At that moment, however, California had already begun to fur¬
nish to the world its golden treasures, thus making a market for
labor under which immigration for several years rapidly increased.
That period, however, terminated with 1854, and thenceforward
railroad property, as a natural consequence of continued railroad
agitation for the abolition of the duty on railroad iron, rapidly
decreased in value, as is shown by the following figures :— ■
1852-3. 1855.
Baltimore and Oliio 98 56
Boston and Worcester .... 105 87 J
New York and Erie ..... 85 52
Cleveland and Pittsburg .... 93 70
Michigan Southern 118 97
Cincinnati and Dayton .... 102 *85
Pennsylvania Central .... 93 88
Camden and Amboy 149 128
Boston and Maine ..... 102 94
From that date to the opening of the rebellion immigration de¬
clined ; internal development almost ceased ; and railroad property
so much depreciated that the average value of the New York Cen¬
tral, Erie, Hudson River, Reading, Michigan Central, Michigan
Southern, Rhode Island, Cleveland and Toledo, Illinois Central,
and Galena and Ohio roads was only forty-two per cent.
The war came, bringing with it protection to the farmer, accom¬
panied by an increase in the value of railroad property, as exhi¬
bited in the following figures giving tjie average prices of the several
roads last above referred to :—
5
January, 1855 1860 1862 1863 1864
42 56 51 95 143
Seeking now the cause of the vast change that is here exhibited
we find it in the following passages from Reports just made by two
important Western roads—the Southern Michigan and the Cleve¬
land and Pittsburg Railroad.
Prom the first we learn that—
" Although the decline on the through business is at the rate of
$30,000 to $40,000 per month, so great has been the increase in
local traffic that the aggregate earnings for January, 1865, show an
increase of about $50,000 over the corresponding month last year.
Although there has been no diminution in the number of employees,
the aggregate number of miles run by passenger trains is now 5000
per week less than it was before the issuing of the passport order.
There is, therefore, a considerable saving in running expenses."
And from the second that—
"The great increase of freight upon the road has come in a very
important degree from two articles of traffic which may be considered
the staple of your road, naturally and legitimately belonging to it.
These articles are coal and iron ore of Lake Superior. The coal
interest was one of the principal agencies in planning and building
this road, and those early projectors of the enterprise have always
looked to the development of the coal mines on the line of the road
as a sure and steady means of remuneration. The coal trade has
from the first held an important place among the various sources of
revenue to your road. It has steadily increased with the progress
of years, and as manufacturing has been more extensively under¬
taken, and as new demands for coal from regions before unsupplied
have arisen, the transportation over your road has been greatly
increased in amount."
What is true of these two roads, is almost equally so of those of
the country at large, the existing prosperity of the whole railroad
interest having come as a natural consequence of great develop¬
ments of mineral wealth. Take, for instance, petroleum, of which
to the extent of $46,000,000 was sent to market in the past year,
and see, my dear sir, how large have already become its contribu¬
tions to railroad revenues. Look further, however, and see how
enormous they must become when Ohio, Virginia, and other States
shall have sunk their wells and erected their engines, and when refin¬
eries shall, at the place of production, fit it for eheap transportation
to the remotest corners of Maine in the Northeast and Texas in the
Southwest, Florida in the Southeast and Nevada in the Northwest;
e
and then endeavor to satisfy yourself to what extent it is that every
road in the country is interested in the successful prosecution of the
great work of development that has but now commenced. Take
next the 13,000,000 tons of coal now mined, and follow them in
their travels throughout the Union, paying toll directly to roads in
the East and roads in the West, and indirectly to every one in the
whole extent of the loyal States. Add now to them the 1,300,000
tons of pig metal at present made, and follow them, in all their
various forms of railroad bars, stoves, pipes, knives, and engines,
and then determine to what extent they have contributed to give to
the roads of the country their present value.
Study next, I pray you, the perfect harmony of all these various
interests, and satisfy yourself how shortsighted are the men who
believe in national discords. What is it that has so suddenly given
an almost fabulous value to the great oil region of the West? Is
it not the almost immediate presence of the great machine-shops
of Ohio, Indiana, Illinois, and Pennsylvania? What would be its
value were its owners obliged to seek in Birmingham for engines ?
It would have none whatsoever. To whom, however, are we in¬
debted for those shops? Is it not to men who have sunk mines
and built furnaces, others who have mined coal and ore, and still
others who have converted raw material into pigs and pipes?
That it is so, cannot be questioned. The harmony of all those
interests is absolute and complete.
Equally so is that which exists between the men who make and
those who need to purchase the railroad bar. Many millions of
dollars worth of oil go to market, there to be exchanged for sugar
and coffee, cloth, iron, and the thousand other commodities needed
for a population that is increasing in wealth and numbers, and at
every stage of their progress they contribute towards railroad divi¬
dends. So, too, with the iron and the coal. I have now before me
the accounts of a single iron establishment that paid last year, in
railroad tolls, no less a sum than $200,000. Judging from this,
at how many millions might we safely fix the contributions of coal
and iron to the maintenance of the railroad interest?
To enable us to form an accurate judgment of the amount of
such contributions by the great fundamental industries, let us for
a moment look to the effect that would at once result from
their annihilation. Would it not certainly diminish by two-thirds
the real value of every railroad in the Union? That it would
1
do so, cannot be questioned. What, then, would be the effect were
we in the next seven years to double, even if we should not treble,
the product of our mines, our furnaces, our rolling-mills, and our
wells? Could it fail to be that of giving to all railroad property
a fixed and certain value, even when estimated in gold, greater than
it ever yet has known? That it could not fail to do so, is abso¬
lutely certain. That you may now be led, my dear sir, to arrive, in
this respect, at the same belief with myself, I would ask you to look
to the fact that a coal mine is a vast magazine of power; that thou¬
sands of tons of coal can be made to do the work of hundreds of
thousands of men ; that in the extent and variety of metallic de¬
posits we are ahead of the whole of Europe combined; that power
alone is needed for bringing to light the vast treasures of the iron
mountains of Missouri on the west, and of the Adirondack on the
east—of the great iron and copper beds of the shores of Lake Su¬
perior—of the wealth-abounding hills of Tennessee—of the great
lead deposits of Illinois and Iowa—of the coal, iron, and gold
abounding districts of Virginia—of the zinc and iron deposits of
New Jersey—and of the granite hills of New England; that the
power at our command is equal to that of almost the whole earth
combined ; that that now used in Great Britain alone is estimated
as being equal to the labor of 600,000,000 of men ; that by a proper
application of our energies we might within the next decade go far
beyond even that vast amount ; that production increases almost
geometrically as the power applied increases arithmetically ; that
exchanges increase with the increase of production; that the power
to contribute to the maintenance of roads increases with a rapidity
far exceeding that of production ; and then determine for yourself
how magnificent is the future that will open itself to the eye of
every railroad manager when he and his fellow-proprietors shall
have arrived at the conclusion, that there is a perfect harmony in
the interests of the men who make iron and those who need to use
it, and that an enlightened self-interest demands of them that they
shall ask of Congress the establishment of such a revenue system as
shall give to the capitalist that certainty in regard to the future
which is needed for enabling us, before the lapse of another decade,
to place ourselves side by side with Great Britain in the production
of many of the most important metals, and before the close of
another to leave her far behind, thus giving to the farmer a market
near at hand for all his products.
8
The mind is lost in contemplation of the marvellous amount of
wealth and power that has by a beneficent Creator been placed at
our command. Still more, however, is it lost in wonder when
studying the slow degrees by which we have arrived at the idea that
prosperity among our people, freedom to the slave, and power and
influence among the nations of the world, were to come to us only
as a consequence of the application of that vast power to the de¬
velopment of that wonderful wealth. More than thirty years since,
at the close of the protective period which began in 1828, our con¬
sumption of iron was 300,000 tons. Ten years later, at the close
of a long and dreary free-trade period, with a population one-third
greater, the consumption was still but little more. Five years
later, at the close of the protective period of 1842, our production
liad already trebled, and so great had become the demand, that the
import of foreign iron was nearly as great as it had been in 1842.
Ten years still later, with a population again a third increased, and
with all the advantage of California gold developments, our pro¬
duction, under the British free-trade system, had diminished, while
our total consumption had scarcely at all increased. Of the four
years that have since passed by, one was a period of universal pros¬
tration, and yet, in the three that have succeeded our consumption
has been carried up to a point nearly one-third higher than that at
which it stood at the outbreak of the great rebellion. These are
remarkable facts, and with them is connected another series of
phenomena of the highest importance to railroad proprietors, which,
however, seems to have escaped their notice. Whenever the domes¬
tic production of iron has been advancing railroad property has
paid good dividends, while dividends have always declined as
furnaces and rolling-mills became idle and their proprietors
became bankrupt. In 1832, the first of the protective periods
above referred to, railroads had scarcely yet made their appearance
on the stage, but transporters of every description were highly
prosperous. In 1842, at the close of the first of the above-named
free-trade periods, furnaces were closed and railroad companies were
bankrupt. In 1847, the second protective period, ironmasters were
prosperous and railroad companies paid good dividends. In 1854,
under a temporary California excitement, railroad stocks were high
and ironmasters were building rolling-mills. In 1860, at the close
of the last free-trade period, railroad stocks were selling, as has
been already shown, at an average of 42 per cent., and mills, mines,
9
and furnaces were everywhere closed. To-day, after three years of
protection, all is changed, ironmasters having doubled, their pro¬
duction and thus enabled railroad stocks to go again to par.
The direct connection between the road and iron interests is here
so clearly obvious that it is almost marvellous that the former
should so long have failed to see it. More wonderful is it, how¬
ever, that seeing what has but now occurred, they should yet con¬
tinue so blind to their true interests as to array themselves in oppo¬
sition to any measure on the part of Congress that shall tend to
give that security for the future without which the capitalist will
not give his time and his means to the opening of mines, or to the
building of furnaces and mills. To induce him so to apply his
powers he must have protection against that system so well described
in an extract from a Parliamentary Report to which your attention
has already more than once been called, and which, as I have said,
should be read day by day, week by week, month by month, and
year by year, by every man who desires to see the Union maintained,
with constant increase in the power of the nation to command the
respect of the other communities of the earth. It is as follows :—
"The laboring classes generally, in the manufacturing districts of
this country and especially in the iron and coal districts, are very
little aware of the extent to which they are often indebted for their
being employed at all to the immense losses which their employers
voluntarily incur in bad times, in order to destroy foreign competi¬
tion, and to gain and keep possession of foreign markets. Au¬
thentic instances are well known of employers having in such times
carried on their works at a loss amounting in the aggregate to
three or four hundred thousand pounds in the course of three or
four years. If the efforts of those who encourage the combinations
to restrict the amount of labor and to produce strikes were to be
successful for- any length of time, the great accumulations of capital
could no longer be made which enable a few of the most wealthy
capitalists to overwhelm all foreign competition in times of great
depression, and thus to clear the way for the whole trade to step
in when prices revive, and to carry on a great business before foreign
capital can again accumulate to such an extent as to be able to
establish a competition in prices with any chance of success. The
large capitalists of this country are the great instruments of warfare
against the competing capital of foreign countries, and are the most
essential instruments now remaining by which our manufacturing
supremacy can be maintained ; the other elements—cheap labor,
abundance of raw material, means of communication, and skilled
labor—being rapidly in process of being equalized."
10
The wealthy British "capitalists" here described have their
agents everywhere, and everywhere prepared for combination with
every little private or local interest for the removal of grievances of
which they know their masters and themselves to he the cause.
What they desire, as they know full well, is that food may be cheap
and iron high in price. What we desire, and what by means of
protection we are seeking to obtain, is that the farmer may from
year to year be enabled to obtain more spades and ploughs, and
better means of transportation, in exchange for less and less of food.
When, however, the farmer complains of the low price of corn, he
finds the agent always at hand, Mephistophiles-like, to whisper in
his ear that but for protection spades and ploughs would be cheaper,
while food would command a higher price. When the railroad
manager seeks to buy iron, he points to the low price at which
British iron might be purchased, wholly omitting to call the atten¬
tion of his hearer to the facts, that British iron is always cheap
when American people build furnaces, and when American rail¬
road companies make good dividends, and always dear when Ame¬
rican furnaces have been blotted out of existence, when their
owners have been made bankrupt, and when American railroad
stocks are of little worth. In proof of this, I now give you the'
following facts as they present themselves in the Reports on Com¬
merce and Navigation for the several years above referred to :—
At the close of the protective period which commenced in 1828
and terminated in 1833—that one in which for the first time the
iron manufacture made a great forward movement, and therefore
the most prosperous one that the country had ever known, the
price at which British bar iron, rails included, was shipped to this
country, was forty dollars.
Eight years later, in 1841, when our mechanics were seeking
alms—when our farmers could find no market—when furnaces
and mills were everywhere closed, and their owners everywhere
ruined—when States were repudiating, and the National Treasury
was wholly unable to meet its small engagements—the. shipping
price of British bars had been advanced to fifty dollars.
Eight years later, in 1849, after protection had carried up our
domestic product to 800,000 tons, and after the British free trade
tariff of 1846 had once again placed our ironmasters under the
heel of the " wealthy English capitalist," we find the latter ener¬
getically using that potent "instrument of warfare" by means of
11
which he " gains and keeps possession of foreign markets," and
supplying bar iron at thirty dollars per ton. In what man¬
ner, however, was the railroad interest paying for a reduction
like this, by means of which they were being enabled to save on
their repairs a tenth or a twentieth of one per cent, on their re¬
spective capitals ? Seeking an answer to this question I find in the
Merchant's Magazine a comparison of the prices in February, 1848
and 1850, of thirteen important roads, by which it is shown that in
that short period there had been a decline of more than thirty
per cent. ! This would seem to be paying somewhat dearly for the
whistle of cheap iron ; and yet it is but trifling as compared with
information contained in a paragraph which follows in which are
given the names of numerous important roads, whose cost had been
very many millions of dollars, but which " from prices quoted, and
those merely nominal, seem to be of little or no value—not enough,
nor one-fourth enough, to pay interest on the sums advanced for
their creation."
At the close of another term of similar length, say in 1857, we
arrive at a scene of ruin more general than any that had been wit¬
nessed since the closing years of that British free trade period which
terminated with the universal crash of '42. How very low were
then railroad stocks has been already shown. What, however, was
the price at which British ironmasters were willing, now that they
had so effectually crushed out competition, to meet the demands
of railroad managers ? Were they still willing to accept $30 per
ton as the shipping price ? Did they then manifest any desire to
help the friends who had so largely aided them in "gaining and
keeping possession" of this American market ? Far from it ! The
more that railroad stocks went down, as a consequence of failure
of the domestic commerce, the more determined did the British
masters of our American stockholders show themselves, Shylock-
like, determined to exact "the pound of flesh." In this unhappy
period the shipping price of bars was $48, and that of railroad iron
$42, the average having been forty-fodr dollars, or nearly fifty
per cent, advance on the prices accepted in 1849, when our foreign
lords and masters had been engaged in " overwhelming all foreign
competition in times of great depression," and thus " clearing the
way for the whole trade to step in when prices revived, and to
carry on a great business before foreign capital could again accu-
12
muíate so as to be able to establish a competition in prices with
any chance of success."
Twice thus, at intervals of eight years each, have we had low
British prices and great American prosperity as a consequence of
the adoption of a policy under which American competition for the
sale of iron has largely grown. Twice, at similar intervals, have
we had high British prices and universal American depression as a
consequence of the re-adoption of that system under which we have
been compelled to compete in a foreign market for the purchase of
British iron. Twice, thus, have American railroad managers been
"brayed" in the British free trade "mortar," and twice have Ame¬
rican transporters found prosperity by aid of those protective
measures to which they have always shown themselves so much
opposed. Their British free trade experience had been a somewhat
sad one. Have they profited of it ? Let us see.
Another eight year period has now passed by, and we reach the
present year 1865, with railroad stocks selling for a thousand mil¬
lions of dollars that would not, at its commencement, have sold for
five hundred millions. What has caused this wonderful change ?
The re-creation, by means of a protective tariff, of a great internal
commerce, and nothing else. Under that tariff mines have been
opened, mills and furnaces have been built, demand has been created
for labor and labor's products, commerce has grown, and road
proprietors have participated with farmers in the advantages re¬
sulting from the creation of a great domestic market which are so
well described in an extract from the recent message of Governor
Yates, of Illinois, already given, but here reproduced because of its
important bearing on the question now before us :—
" As a State, notwithstanding the war, we have prospered beyond
all former precedents. Notwithstanding nearly two hundred thou¬
sand of the most athletic and vigorous of our population have been
withdrawn from the field of production, the area of land now under
cultivation is greater than at any former period, and the census of
1865 will exhibit an astonishing increase in every department of
material industry and advancement ; in a great increase of agricul¬
tural, manufacturing, and mechanical wealth ; in new and improved
modes for production of every kind ; in the substitution of machinery
for the manual labor withdrawn by the war ; in the triumphs of in¬
vention ; in the wonderful increase of railroad enterprise ; in the
universal activity of business, in all its branches; in the rapid growth
of our cities and villages; in the bountiful harvests, and in an un¬
exampled material prosperity, prevailing on every hand ; while, at
13
the same time, the educational institutions of the people have in no
way declined. Our colleges and schools, of every class and grade,
are in the most flourishing condition ; our benevolent institutions,
State and private, are kept up and maintained ; and, in a word, our
prosperity is as complete and ample as though no tread of armies
or beat of drum had been heard in all our borders."
The picture here given is that of every loyal State of the Union,
and yet it is but the beginning of the change that is to be accom¬
plished by means of the establishment of perfect commercial inde¬
pendence. Railroad proprietors have already profited of it to the
extent of hundreds of millions of dollars, and they have yet to
profit to the extent of many other hundreds of millions by the
further opening of mines, the further building of mills, and the
further development of the wonderful amount of mineral wealth
placed by a kind Providence at our command, and waiting only the
application of that power which now lies hidden beneath the soil
of so many thousands of square miles of all these central States.
So having profited in the past, and having in view so large a profit
in the future, it might be supposed that they would now, at least, be
content. Are they so ? Are they disposed to let well alone ! Has
their "foolishness" at length departed from them ? Having been
now so repeatedly "brayed" in the free trade "mortar," are they
now at last awakened to a sense of the advantages that must in¬
evitably result to themselves from carrying up our production of iron
from hundreds of thousands to millions of tons ? Do they see that
to enable the Union to hold together, we must establish such an in¬
ternal commerce as will permit of exchanges being made between
its various parts freed from the intervention of British agents,
British ships, and British ports ? Are their eyes yet open to a per¬
ception of the fact that the country that makes the most iron is
the one into whose hands must fall the direction of the commerce
of the world? Have they, in any manner, profited by the sad ex¬
perience of the past? To all these questions the reply must, un¬
happily, be a negative one. Like the Bourbons, they have learned
nothing, and have forgotten none of their free trade prejudices, and
it is much to be feared they never will, or can, do so. Despite all
the lessons of the past they have now allied themselves with British
agents for crushing out those great fundamental industries to which
alone we can look for that success in the war in which we are now
engaged without which railroad stocks and bonds, Government
14
bonds, and property of all descriptions must lose two-thirds of their
present value.
The men most active in the work of destruction are, strangely
enough, precisely those whose real and permanent interests should
lead them in the opposite direction—the representatives of trans-
Mississippi roads. Of all our people they are those who should
most desire to promote immigration, and yet they close their eyes
to the fact that immigration grows with development of our mineral
resources and declines as furnaces are blown out and rolling mills
are closed. Of all, they should most desire that existing railroad
property should be productive, yet do they close their eyes to the
fact that such property has always declined in value as furnaces and
mills were closed, and grown again as mills were once again opened,
and as furnaces were built. Of all, they should most desire that a
low price of foreign iron should operate as a check upon our iron¬
masters, yet do they close their eyes to the fact that such iron has
always fallen in price as domestic competition has grown, and risen
again as soon as they and others like them had succeeded in
enabling the " wealthy English capitalists" to destroy that compe¬
tition. Of all, they are those who have suffered most and learned
the least.
It was under the protective tariff of 1828 that immigration first
became a matter of much importance. Furnaces were then built,
internal commerce grew rapidly, farmers became rich, transporters
were well rewarded for their services, im migration trebled in its
amount, and American competition compelled the British iron¬
masters to furnish iron at a moderate price.
Eight years later all this was changed, the American makers-of
roads and of iron being both together ruined, labor being every¬
where in excess of the demand, and immigration remaining sta¬
tionary at a point but little higher than it had so promptly reached
in 1834.
Eight years still later we find that under protection the produc¬
tion of iron had trebled, thereby making such demand for labor as
to have carried the number of immigrants up to little short of
300,000.
At the close of another period of similar length, passed under
the free trade system, we find labor to have been in excess of demand
while railroad owners were being ruined, and immigration to have
so far declined as to have ceased to merit much consideration.
15
Again, in 1865, we have reached a period of some protection to
the greatest of all the industries of the world. Labor is, therefore,
in demand. Immigration grows, and with it the value of railroad
stock, while British iron is very cheap.
The close connection that here is shown to exist between immi¬
gration and protection, as well as between prosperity and a low
price of British iron, ought surely to be sufficient to satisfy our
trans-Mississippi friends of the absolute necessity that exists for
giving to the great departments of industry that certain protection
which is required for securing a rapid increase in the domestic com¬
petition for supplying the market with coal, paper, leather, and iron
of all descriptions. They have land in abundance, and their mineral
wealth is great beyond all calculation. What they need is power.
To obtain that they must have men to mine their coal and their ore,
to build engines, to clear their lands, and to make their roads. Men
come always when we have protection. They fly from us always
when we are subjected to the British free trade system. Can they
not, then, see that all their real and permanent interests are in per¬
fect harmony with those of the older States ? Must they be once
more " brayed" in the free trade " mortar" before they will come
to understand these things ?
So much for the past, and* now, for a moment, let us look to the
future. To all appearances it will be needed, within a very brief
period, to relay all the southern roads, and there will be need for
hundreds of thousands of tons of rails. Are we preparing for this?
Are we now building furnaces and rolling mills ? We are not! On
the contrary, they are being closed, even the present taxes, as com¬
pared with the duties on that made abroad, being so oppressive that
the work of manufacture can no longer be carried on with any
profit. It is seen, too, that the nearer we approach a gold value
the heavier become the internal taxes, and the more does the foreign
manufacturer tend to become protected against the domestic one.
Let this continue but a little longer, and let occasion arise for laying
those Southern roads, and what then will be the price of British
iron ? Cannot our railroad managers see that, in pursuing their
present course, they are not only " killing the goose that lays the
golden egg," but also providing for subjecting themselves to a taxa¬
tion for the benefit of our British friends that, combined with the
loss of the domestic traffic, must cause the price of their stock to
fall again to the low price at which it stood in 1851 ? Cannot
16
they see that now, as always heretofore, they are playing cards that
have been placed in their hands by men whose one great object in
life is that of having food and labor cheap while iron is maintained
at the highest price ? Can they not see that the objects they should
always have in view are directly the reverse of this, their prosperity
coming always with rise in the profits of the farmer and in the
wages of the laborer, and decline in the price of iron ? They are
now laboring to arrest the growing tendency to emigration from
the shores of Europe; and yet, every man who can be attracted here
becomes, from the moment of his arrival, a contributor to their
revenues, while preparing, by means of procreation, for a further in¬
crease in the number of such contributors, and in the powers of each
and all.
It is surely time that our railroad managers should awaken to
the fact that their interests are so perfectly in harmony with those
of the men who mine coal and make iron that every blow levelled
at the latter tells directly upon themselves. When they shall do
so—when they shall have arrived at the conclusion that these two
great interests should stand shoulder to shoulder with each other,
and that an enlightened self-interest ought to prompt them to aid
in securing the adoption of measures looking to the incorporation
of home-grown food in every yard of cloth, every ream of paper,
and every hide of leather consumed on this side of the Atlantic—we
shall then at length be fairly on the road toward finding how it is
that we may outdo England without fighting her.
Sincerely hoping that the day may not be far distant when all
this shall be done, and when our people shall, to use the words of
Jackson, become a little more Americanized, I remain, my dear
sir, with great regard and respect,
Yours very truly,
HENRY C. CAREY.
Hon. Schuyler Colfax.
Philadelphia, February 10, 1865.
6AYL0RD BROS.
MAKERS
SYRACUSE, - N.Y,
PAT. JAN. 21, I908
3 5556 042
5964