IN December 1892, a few days after the Presidential election in the United States had resulted in the victory of the Democrats, we were enabled to present to our readers a history of American tariff policy and legislation, an account of the election contest that had just closed, and an outline of the changes likely to be effected by the incoming administration.1 We pointed out that the performance of the Democratic party would not come up to the expectations raised by the circus bills; that no one need expect even the appearance of a freetrade tariff; that no sudden changes would be made; that the Democratic party was too shrewd to withdraw suddenly the props from industries that had been created by the Republican system; that a panic would be the result if this were done; that time would be given for the withdrawal of capital from the industries likely to be effected by change; that a considerable reduction of duties would in the end be made on goods not competing with American manufactures; and that further reductions would be made on articles supposed to be overprotected, and on articles entering largely into consumption by the poor.

We resume the discussion of an always interesting subject for the purpose of showing that this forecast has in the main been fulfilled; of placing once more before the public the circumstances surrounding the new legislation; and of giving a general view of the "Wilson Bill"-as the new Tariff Act is called-and its bearing on

external commerce. The readers of the former article will see that, as nearly two years have elapsed since the Presidential election, our forecast of prudential slowness of movement has been sufficiently exact. Of course the elections did not in America place power in the hands of a new administration at once. Months had to elapse before the new President was inaugurated.

Other months had to elapse before Congress could be called. In the meantime the activities of the country were paralysed by the mandate which had been menacingly issued by the people for wholesale changes in policy. Operations extending over any but the briefest time were not entered upon. The menaced man

ufacturers ceased to be active. Workmen began to be discharged. Contracts ceased in many instances to be filled. Strong banks began to pursue conservative lines on loaning, and weak banks succumbed. The weakness of the silver legislation revealed itself in a universal want of confidence in the silver currency. Those who had national currency in paper would not part with it. Wages could not in many cases be paid by some of the richest corporations in America. Not alone the internal circumstances of the country contributed to this result. The vindictive policy of the M'Kinley Bill, which had threatened in turn the domestic and colonial commerce of every nation in Europe, provoked its natural results. The Foreign Creditor, acting with the relentless force of a natural law,— as capital always acts in international relations,-returned upon

the hands of the United States the gold-bearing securities in which perfect confidence could no longer be placed; and the gold-borrowing nation was forced to recognise the fact that it could not with impunity become a pirate to its creditors. A winter followed of such distress that the pangs of its poverty penetrated the remotest recesses of the country, and awakened in many serious minds the terrors foretold in Scripture of a great tribulation. Finally Congress met; the Wilson Bill was prepared and presented; it was discussed at length with much bitterness and some scenes of disturbance; and has at length, after several revisions, been brought forth a complete legislative meas

ure.

Two points may be noticed before we proceed to deal directly with the effects of the bill.

The first point is political, and regards the United States itself. Those who in this country have been snared by the cant of catching phrases concerning "Federal" government, may look with alarm, if not with positive terror, to this example of a Government in which the Popular Will, though overwhelmingly expressed, is yet made powerless for many months (in this case for two years) by the rigidity of a written constitution. Twice in our own recent political history, in 1874 and in 1880, such sweeping popular votes had the effect of placing power almost immediately in the hands of the men in whom the country had expressed confidence. But in the United States such expression was vain.

The second point is commercial, and affects all the world, the United States included. It will be seen that the uncertainty which has prevailed regarding the tariff has affected not merely the manufactures, the imports and exports of the United States, but also the

manufactures and imports and exports of other nations as well. And this disturbance has been prolonged for so long a period that though the Wilson Bill is now a legislative measure, we are asked by those who are opposed to it in America to bear witness to the fact that State elections already show a reaction against the Democrats, and that the new tariff will not outlast its framers and their four years of power. In effect this means that the financial and commercial world is to be treated to four years more of experiment after 1896, with the assurance that the reactionists will return bringing seven other M'Kinleys with them. If the powers of combination in Europe are exhausted, and the kings of capital have lost their genius for finance, may we not venture to express a hope that there may be found in the widestextended empire the world has ever seen some resource in a union, if not of hands and hearts, at least of policy and purses, against this systematic revolt on the part of America against the commerce of the world?

The Wilson Bill was committed to the committee of the whole House of Representatives, from the Committee of Ways and Means, by Mr Wilson of Virginia, on December 19, 1893. It was alleged in the Committee's report that the American people had decided that the existing tariff was wrong in principle and unjust in operation. The power of taxation had no lawful or constitutional exercise except for providing revenue for the support of Government: this proposition, it may be observed, was in contradiction of two of the bestknown decisions of the United States Supreme Court in support of a protection tariff.

been taken into partnership with the Government, so many private enterprises now share in the rich prerog: ative of taxing seventy millions of people, that any attempt to dissolve this illegal union is necessarily encountered by an opposition that rallies behind it the intolerance of monopoly, the power of concentrated wealth, the inertia of fixed habits, and the honest errors of a generation of false teaching."

This, indeed, was "comfortable doctrine," but the "Glory, Hallelujahs!" of a pious Democracy had hardly been uttered when the following sentences burst on their startled ears :—

"The bill on which the Committee has expended much patient and anxious labour is not offered as a complete response to the mandate of the American people. It no more professes to be purged of all protection than to be free of all error in its complex and manifold details. However we may deny the existence of any legislative pledge or the right of any Congress to make such pledge for the continuance of duties that carry with them more or less acknowledged protection, we are forced to consider that great interests do exist, whose existence and prosperity it is no part of our reform either to imperil or to curtail."

If the long delay in bringing in a measure justified our forecast as to time, this language fully justifies our forecast as to the smallness of the "free trade" revival that was to follow. That the Wilson Bill should be denounced by the most vigorous of the Democratic daily papers as a fraud on the public, which had issued its "mandate "" in November 1892, was not very remarkable. In the Democratic "platform " of 1892 we may read as follows: "We denounce Republican protection as a fraud, a robbery of the great majority of the American people for the benefit of the few. We denounce the M'Kinley tariff as the culminating atrocity of class legisla

tion."

And when this declaration of 1892 is followed in 1894 by this other declaration in the report on the Wilson Bill-"But in dealing with the tariff, as with every other long-standing abuse that has interwoven itself with our social or industrial system, the legislator must always remember that, in the beginning, temperate reform is safest, having in itself the 'principle of growth""-it is obvious that a sense of humour is required to appreciate the situation! The great American joke is never played out.

The gentlemen of the minority on the Committee put forth, of course, the legend on the other side of the shield. They pointed

the

out that this new tariff would deprive the country at once of $74,000,000 of revenue at a time when the latest figures available proved that the revenue was only $2,000,000 above the expenditures. This was indeed a point to which the majority had addressed themselves, as they had stated that they looked to the increase of commerce to make up the loss of revenue, and also that they intended to bring in measures of internal revenue taxation-an income-tax among other things-to recoup treasury. The Republicans also pointed out that "the larger part of the burden of taxation is transferred from foreigners and borne by our own citizens"-this being an old and favourite theory of the Republican party. Naturally, the Republicans also pointed out that the Democratic bill falsified the Democratic pledges, and was a distinct abandonment of the mandate of the people." That the Republicans should take advantage of the obvious failure of the Democrats to fulfil their election pledges was only natural. But the plea did not carry much weight in the House, though it will have its

effect on the next elections. To catch the Republicans bathing, and to steal their clothes, is not a policy which can be permanently successful.

The political aspect of the bill having been thus presented, in a manner, we trust, sufficiently clear, the purely business character of it may be indicated in a general way. The bill has been "reported" at various stages, as it came from the House Committee, as it emerged from the House of Representatives, as it was reported from the Senate Committee, as it was placed before a joint committee, and as it has been finally passed. Each stage witnessed a change in its features. A few examples will suffice. Thus, the Wilson Bill, by means of the majority report of the House Committee, recommended the freedom of iron and coal as the basis of modern industry. The Republican minority protested that this concession was given to manufacturers at the cost of the mines and the railways. The item of iron and its manufactures finally appeared in the bill as passed in the House of Representatives, at from 10 to 35 per cent ad valorem, instead of the specific duty of so much per pound, as under the M'Kinley Bill of 1890 and the tariff of 1883. It emerges finally subject to a mixed specific and ad valorem schedule, the ad valorem duties showing in some cases an increase to 45 per cent, though there is still a general reduction of the specific duties on articles of common use, as compared with the M'Kinley Bill.

Wool was also put on the free list in the original bill, the old duty not having been, in the opinion of the Democratic majority, beneficial in its operation, and a revival of woollen industry being expected under a régime of free wool. The Advocatus Diaboli of

the Republican minority, however, contended that as experience had shown that the woollen manufacturers of the United States needed 30 to 40 per cent to protect them during many years, they would necessarily collapse when the duty was removed. The item came into the original bill at from 15 to 40 per cent ad valorem, instead of the high, mixed, specific, and ad valorem duty under the Act of 1890. The classification and conditions of import were also changed, and the reduction of the duty was spread over a period of years, ending in 1900-reminding us of the Irishman's way of cutting off his dog's tail a little at a time "to make it aisy for the baste!" The item finally emerges on the free list, and the authorities have decided that wool will not have to be re-exported and re-entered in order to obtain the benefit of the new duty. The Canadian border would have been made use of, by arrangement, in such a case, as is sometimes done in the case of liquors that have remained too long in bond, on which duty would have to be paid at once if the goods were not re-entered.

Books still remain at 25 per cent ad valorem under the beneficent influence of the printers' unions, who had power also to prevent copyright, except on the condition of printing in the United States; and the rule which allowed books in foreign languages to come in free, while English books were taxed, has been invidiously retained. Sugar has been made more free by the abolition of. the domestic bounty given by the M'Kinley Bill; but it is not quite easy to say how an ad valorem duty (with specifics in addition) of 40 per cent is going to be of any advantage to any but the local producer, who can afford to