50 PRODUCTION AND FREE TRADE. 



CHAPTER XI. 



PRODUCTION AND FREE TRADE. 



SALEM, Neb., Dec. 29, 1874. 

 To the Editor of the Inter- Ocean : 



Being a constant reader of your paper, and seeing you are in favor of a Pro 

 tective tariff, I would like more light on this subject. I am a farmer. It seems 

 to me to be a plain fact that no portion of our country could be benefited by the 

 stopping of our factories, and also plain that they will not stop unless they are 

 likely to invest their means where it will pay better. Now, if Free Trade should 

 stop them, will it pay better under that regime to produce ? It seems to me that 

 the whole question turns upon this point : What is the relative cost of manufac 

 turing, say, cotton and wool, so as to add one hundred or any other given per 

 cent, to the cost of production ? The reason of my selecting these two is be 

 cause they are the most profitable productions of the soil. Hoping you will 

 deem these two questions worthy of consideration, I remain yours, for the right, 



GEORGE WATKINS. 



IF we fully comprehend our correspondent, his first proposition 

 involves the common Free Trade fallacy that any manufacturer 

 who finds his business a losing one can change his investment to 

 Some other form of production. In fact, he can do so only in ex 

 ceptional cases. Take a woolen mill, for example. A capitalist 

 puts money into a building, into machinery, into raw material, 

 and, employing operatives, makes cloth. He discovers that his fac 

 tory will not pay. How is he to change his investment ? Is he 

 likely to find a purchaser for a losing business ? How is he to 

 turn, without great sacrifice, if at all, to some other kind of indus 

 try ? Perhaps his building might be devoted to different purposes ; 

 but what is he to do with his machinery, adapted only to convert 

 wool into cloth? It is manifest that the man can not extricate 

 himself without more or less loss, leaving him weakened financially, 

 possibly bankrupt. If his mill stops running, what is to become of 

 his force of working people, thrown out of employment ? What 



