CHAPTER V.

OUR EARLY SHIPPING POLICY ITS PRINCIPLE AND MEASURES.

Commercial Views of our Early Statesmen. Deeply impressed with the importance of navigation, of being at once our own merchants and carriers, our own shipbuilders and navigators, our own sentinels and defenders on the ocean, the founders of our Government had long studied the principles of equitable commerce. They did not approve the British system, but felt that it should be improved. They had only such regulations as the different States had originated. They would have to form a system for the Federal Government to enforce. In contrast with others, its principles must be just and reasonable, not selfish and monopolistic. For instance, in the words of Madison, "We were prohibited by the British laws from carrying to Great Britain the produce of other countries from their ports; or our own produce from the ports of other countries or the produce of other countries from our own ports; or to send our own produce from our own or other ports in the vessels of other countries."

Our early statesmen believed in "fair commerce," which was thus stated by BENJAMIN FRANKLIN :—

"Fair commerce is where equal values are exchanged for equal, the expense of transportation included. Thus if it cost: A in England as much labor and charge to raise a bushel of wheat as it costs B in France to produce four gallons of wine, then are four gallons of wine the fair exchange for a bushel of wheat; A and B meeting at half-distance with their commodities to make the exchange. The advantage of this fair commerce is, that each party increases the number of his enjoyments, having, instead of wheat alone, or wine alone, the use of both wheat and wine."

Our early legislators differed less about navigation than almost any other subject. Their teaching on this topic seems to teem with philosophy, as practical as patriotic. To illustrate, Rufus King, a veteran senator from New York, in his great speech on the Navigation Bill of 1818, said :

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Speech of Rufus King. Agriculture, manufactures, and foreign commerce are the true sources of wealth and power of nations; agriculture is the chief and well-rewarded occupation of our people, and yields in addition to what we want for our use, a great surplus for exportation. Manufactures are making a sure and steady progress; and, with the abundance of food and of raw materials, which the country affords, will, at no distant day, be sufficient, in the principal branches, for our own consumption, and furnish a valuable addition to our exports.

"But without shipping and seamen, the surpluses of agriculture and of manufactures would depreciate on our hands; the cotton, tobacco, breadstuffs, provisions, and manufactures, would turn out to be of little worth, unless we have ships and mariners to carry them abroad, and to distribute them in the foreign markets.

"Nations have adopted different theories, as respects the assistance to be derived from navigation; some have been content with a passive foreign commerce owning no ships themselves, but depending on foreigners and foreign vessels to bring to them their supplies, and to purchase of them their surpluses; while others, and almost every modern nation that borders upon the ocean, have preferred an active foreign trade, carried on, as far as consistent with the reciprocal rights of others, by national ships and seamen.

"A dependence upon foreign navigation subjects those who are so dependent to the known disadvantages arising from foreign wars, and to the expense and risk of the navigation of belligerent nations- the policy of employing a national shipping is, therefore, almost universally approved and adopted; it affords not only a more certain means of prosecuting foreign commerce, but the freight, as well as the profits of trade, are added to the stock of the nation.

"The value and importance of national shipping and national seamen have created among the great maritime Powers, and particularly in England, a strong desire to acquire, by restrictions and exclusions, a disproportionate share of the general commerce of the world.

The True Theory of Commerce. "As all nations have equal rights, and each may claim equal advantages in its intercourse with others, the true theory of international commerce is one of equality, and of reciprocal benefits. This gives to enterprise, to skill, and to capital, their just and natural advantages; any other scheme is merely artificial; and so far as it aims at advantages over those who adhere to the open system, it aims at profit at the expense of natural justice.

"The Colonial system being founded in this vicious theory, has, therefore, proved to be the fruitful source of dissatisfaction, insecurity, and war. According to this system, the colonists were depressed below the rank of their fellow subjects, and the fruits of their industry and their intercourse with foreign countries placed under different regulations from those of the Mother Country; it was the denial to Americans of the rights enjoyed by Englishmen, that produced the American Revolution, and the same cause, greatly aggravated, is working the same effect in South America.

"Among the navigators and discoverers of the Fifteenth and Sixteenth centuries, the Dutch became highly distinguished, and, by enterprise, economy, and perseverance made themselves the carriers of other nations, and their country the entrepôt of Europe - and it was not until the middle of the Seventeenth century, that England passed her Navigation Act,1 which had for its object to curtail the navigation of the Dutch and to extend her

own.

"This act was strenuously opposed by the Dutch, and proved the occasion of the obstinate naval wars that afterward followed.

1 "Origin of the 'Navigation Act' (1646-7). By an ordinance of the Lords and Commons of England, all merchandise, goods and necessaries, for the American plantations, were exempted from duty for three years, on condition that no ship or vessel, in any of the colonial ports, be suffered to land any goods of the growth of the plantations, and carry them to foreign ports, excepting in English bottoms." McGregor's Statistics of America.

England was victorious, persisted in her Navigation Act, and, in the end, broke down the monopoly in trade which the Dutch possessed.

"That in vindication of her equal right to navigate the ocean, England should have resisted the monopoly of the Dutch, and freely expended her blood and treasure to obtain her just share of the general commerce, deserved the approbation of all impartial men. But having accomplished this object, that she should herself aim at, and in the end establish, the same exclusive system and on a more extensive scale, is neither consistent with her own laudable principles, nor compatible with the rights of others; who, relatively to her monopoly now, are in the like situation towards England in which England was towards the Dutch, when she asserted and made good her rights against them."

Genesis of our "Navigation Laws." The Federal Congress began its legislative work April 8, 1789, Mr. Madison proposing to the Committee of the Whole on the state of the Union a tariff measure with a scale of duties substantially the same as attempted in 1783, and afterward agreed to by many of the States. The last three resolutions looked to the encouragement of the carrying trade by discriminating tonnage duties:

"That there ought, moreover, to be levied on all vessels in which goods, wares or merchandise shall be imported, the duties following, viz.: On all vessels built within the United States, and belonging wholly to citizens thereof, at the rate of — per

ton.

"On all vessels belonging wholly to the subjects of powers with whom the United States have formed treaties, or partly to the subjects of such powers, and partly to citizens of the said States, at the rate of

"On all vessels belonging wholly or in part to the subjects of other Powers, at the rate of

This plan of discriminating tonnage duties was James Madison's contribution to shipping protection. His measure as a whole was intended for speedy passage, that revenue might be soon received, but the representatives, dividing in opinion as to the wisdom of temporary legislation, it was determined, practi1 At that time France and Holland only.

cally, to make the tariff system of Pennsylvania, perfected in 1785, the basis of a permanent national system, as advocated by Mr. Fitzsimons of that State. Fitzsimons's list of articles to be taxed specifically was added to the list offered by Madison. (This act was revised in 1790.)

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The shipbuilding interest was early considered. Mr. Madison said he was "not clear as to the policy of taxing cordage." He thought shipbuilding “ an object worthy of legislative attention, and questioned the propriety of raising the price of any article that entered so materially into the structure of vessels. But if it was politic to lay an impost on cordage, would it not be the same with regard to hemp?" (He thought it would and therefore moved it.)

This being objected to, Madison reiterated his objection to taxing cordage. He was "doubtful whether it would not have been as well to have left cordage out; for if a duty on hemp was impolitic because it burdened navigation, so also was that on cordage." He by no means approved of measures injurious to shipbuilding, which he considered in a threefold view; "first, as it related to vessels employed in the coasting trade; second, as it respected those employed in those channels of trade, the stream of which depends upon the policy of foreign nations; and, third, as it was connected with vessels built for sale." The House had just listened to a petition of the shipwrights of Charleston, S. C., stating their distress, and asking for encouragement to navigation and to shipbuilding.

Discriminating Duties in the Asiatic Trade. On April 18, Mr. Fitzsimons introduced a feature of shipping encouragement that was adopted and proved highly successful. He moved the following discriminative duties to be embodied in the bill under discussion: "On all teas imported from China or India, in ships built in the United States, and belonging wholly to a citizen or citizens thereof, as follows: On Bohea tea per pound, 6 cents; on all Souchong and other black teas, 10 cents; on superior green teas, 20 cents; on all other teas, 10 cents.

"On all teas imported from any other country, or from China or India, in ships which are not the property of the United States, as follows: On Bohea tea, per pound 10 cents; Souchong