BENEFITS OF TARIFF PROTECTION. 57 



apprehension that in the race for custom he may be undersold by 

 a rival, is he thereby encouraged to put his price up? We put 

 these questions to the common sense of the reader. There seems 

 to be no logical conclusion other than that a tariff policy which 

 leads to a multiplication of establishments in the same line of 

 business must inevitably tend to a more intense competition for 

 the sale of the product, and, through that, to a growing reduction 

 of prices until the minimum shall have been reached. 



The real cause of the hue and cry raised over the " enormous " 

 duties on steel lies in the fact that the English producers are 

 now compelled, by the exigencies of American competition, to pay a 

 considerable part, perhaps all, of the duties out of their own pock- 

 ets for the privilege of our markets. This we proceed to demon- 

 strate. In 1874 we imported for home consumption, 8,738,483 

 pounds of high grade steel, valued at $1,094,222.32,^16 whole 

 quantity having been consigned to agents of the European houses, 

 not sold to American importers. These figures show an average in- 

 voice value of 12.522 cents per pound. Duties to the amount of 

 $373,742.35 were collected on that steel. This shows an average 

 duty per pound of 4.277 cents. Adding together the average in- 

 voice value and the average duty, we obtain the sum of 16.799 

 cents, gold. Now, the Boston Journal of Commerce, Jan. 30, 1875, 

 quotes English tool steel at 17}^ cents, gold, per pound. Next, 

 subtracting the 16.799 cents from that price, we have a remainder 

 of .701 of a cent., or scarcely more than 7-ioths of a cent in coin. 

 If we allow reasonable estimates for ocean transportation, drayage, 

 insurance, storage in the bonded warehouses, office expenses, com- 

 pensation to agents, losses by bad debts, and so on, the seven mills 

 must not only be swallowed up, but several cents besides, leaving 

 absolutely nothing for profits. How is this deficiency to be made 

 U p f or it must be derived from somewhere unless it is taken out 

 of the pockets of the Sheffield manufacturers? Under all the cir- 

 cumstances, it is not possible to sell English tool steel in the Amer- 

 ican market at 17^ cents, gold, per pound, except on the assump- 

 tion that the foreign producer, not the American consumer, pays 

 the duty in great part, if not entirely. That is where the shoe 

 pinches ; for American tool steel, quite as good as the English, 

 perhaps better, can be bought side by side with the foreign article 



