190 Early History of American Auctions 



capital was therefore doubled. ^^° A contemporary estimated that 

 the United States government thus made a continuing loan of six 

 million dollars without interest to foreigners, our competitors.^^^ 



Protectionists logically claimed that custom house credits were 

 a positive bounty on importations and minimized or nullified the 

 protection given by import duties.^^^ Cash duties meant more 

 stringent protection and therefore manufacturers supported the 

 bill of 1820. 



Customs credits, by easing the importation of goods, undoubt- 

 edly stimulated excessive and speculative importations. ^^^ These 

 were injurious to our manufacturers, merchants, and government, 

 for they made business less stable and dependable, caused bank- 

 ruptcies, and resulted in heavy losses of revenues. It is probable, 

 however, that consumers got goods at lower prices. ^^* The losses 

 of revenue from failure to pay customs credits were particularly 

 heavy in the case of foreign agents, for they had little property 

 other than their imported cargoes and it was too common that 

 one agent went surety for another. Auctions offered a speedy 

 sale and ready means of getting away without paying their 

 credits. ^^^ In 1821 it was remarked that the "increase of custom 

 house delinquencies has kept pace with the increase on foreign 

 account."^^*^ A calculation of the revenue duties from 1789 to 

 1820 showed that of the $351.3 million duties only $1.5 million 

 or 0.45% had been lost by the insolvency or was doubtful.^^'^ 



The system of customs credits as a source of commercial 

 capital became more efficient as the turnover of goods and the 

 number of voyages within the interval of the credit were 



"»Niles, 34: 106. 



"' Niles, 27: 274. See a contrary opinion in Annals of Congress, i6th 

 Congress, ist session, p. 2305. 



'" Niles, 18: 301, 304; 19: 234. 



"'Bolles, I, 495; Niles, 17: 337. 



'"Annals of Congress, i6th Congress, ist session, p. 2304. 



"'Niles, 18: 301; Annals of Congress, 14th Congress, 2d session, p. 850. 



"'Niles, 18: 301. A statement of the amounts in litigation is given 

 according to cities and shows that litigations in those cities whose trade 

 was on foreign account far exceeded those whose trade was on American 

 account, whether their trade was relatively large or small. • 



"^ Niles, 18: 9. See also Report of Secretary of Treasury, Crawford, 

 February 23, 1820. A quarterly statement of customs bonds outstanding 

 1821-2 is given in Niles, 23: 403; they ranged from $16 to 24 million. 



