The Menace of Peace 167 



regardless of cost and pooling- their losses which amounted to 

 "several hundred thousand pounds sterling."^- 



The machinery used to dump their wares was an arrangement 

 bv which agents of foreign manufacturers and merchant export- 

 ers ( I ) received consignments on more or less fictitious invoices 

 and therefore largely evaded import duties, (2) paid the duties 

 by signing customs bonds indorsed by fellow agents or auction- 

 eers and (3) sold the goods by private treaty or more usually at 

 auctions, for cash advanced by the purchaser or the auctioneer 

 or on long credits of six, nine, or twelve months.^" 



The result of this natural and forced glut of our market was 

 a serious industrial distress which reached its worst in the panic 

 of 1819. The inflated state of the currency contributed mightily 

 to this crisis. "Many of our manufacturers fell easy prey to 

 their mighty rivals. First of all the newly erected manufactories 

 of earthenware. ... In the same way went most of the glass- 

 factories, and the manufactures of white and red lead. The 

 manufacture of iron continued longer, but in a feeble way, 

 dwindling every year. . . . During the four years between 

 1817 and 1821, the holders of property in the United States 

 were supposed to have suffered a depreciation of nearly 

 $800,000,000."^* Sheep-raising declined rapidly as domestic 

 factories closed and the wool produced was more largely 

 exported. ^^ The one sustaining force was pronounced to be the 

 protective tariff and the high sterling exchange rates, which 

 together amounted to from 40 to 50% of the foreign cost of 

 production. ^*^ The iron interests were temporarily revived by a 

 duty of $15 per ton imposed in 1818. The balance of trade went 

 decidedly against the States ; the premium on London exchange 

 ranged in 182 1-2 from 8 to 15%, and the country lost much of 



" Xiles. 10: 322; 21: 4. The names of some of the alleged conspirators 

 were Earl Grosvenor, Lord Folkstone, IMr. Brougham and Sir Robert 

 Peele. Niles, 18: 151. 



" Niles, 18: 419; Bolles, I, 366, 488; Dewey, Financial History of 

 U. S., 190. 



" Bolles, I, 370-371. 



" Bolles. I, 367. 



^^ Memorial of New York Chamber of Commerce, 1824. quoted in Bolles, 

 I, Z72. 



