^MSch,imm*}        Internal  Revenue  Tax  on  Alcohol.  113 
machinery.  The  farmers'have  also  benefited  by  this  policy  making 
possible  the  development  of  new  industries  employing  many  thou- 
sands of  workmen,  who  consume  large  quantities  of  German  farm 
products. 
Germany's  manufacturing  industries  in  the  many  lines  in  which 
alcohol  is  used  have  been  enormously  stimulated  by  the  very  low 
price  (the  present  cost,  according  to  Consul-General  Mason's  report, 
being  from  15  to  18  cents  per  gallon)  at  which  it  can  be  procured. 
With  the  advantage  of  a  cheap  and  abundant  supply  of  this  import- 
ant material  the  German  manufacturers  in  these  lines  have  devel- 
oped their  industries  so  that  they  are  now  the  foremost  in  the  world, 
and  have  secured  almost  the  entire  export  trade  to  neutral  markets. 
Among  these  articles  are  the  products  of  the  great  chemical  in- 
dustries, the  coal-tar  colors,  lacquers,  dyes,  varnishes,  perfumery, 
etc.,  etc.  Not  only  does  Germany  practically  control  the  trade  of 
neutral  markets  in  all  the  various  chemical  products,  but  she  also 
sells  large  quantities  of  these  articles  in  this  country,  the  advantage 
resulting  from  cheap  alcohol  being  sufficient  to  enable  them  to  be 
sold  here  in  spite  of  our  protective  tariff.  The  effect  of  our  exorbi- 
tant internal  revenue  tax  on  alcohol  has,  therefore,  been  to  encour- 
age the  sale  in  this  country  of  foreign  production,  instead  of  domes- 
tic origin. 
The  effect  of  the  German  law  of  1887  in  stimulating  the  consump- 
tion of  untaxed  alcohol  is  shown  by  the  following  table  : 
'Year  Ending  Amount  Proof 
Oct.  rst  Gallons. 
1888   20,476,768 
1889   22,786,987 
1890   28,074,667 
J89I   27,426,341 
1892   29,127,384 
1893   32,052,803 
1894    35,102,593 
1895    37,977,396 
1896   .  42,694,947 
1897   45,818,132 
1898     ....  46,979,841 
1899   52,290,000 
1900   .  55,098,285 
1901   61,053,000 
1902     58,632,840 
In  addition  to  this  enormous  amount  of  untaxed  alcohol,  Germany 
