CHAP. XII. MANAGEMENT OF THE DEBT. 279 pointed by the United States Government to inquire into the taxation and revenue, stated that "if the ratio of taxation in Great Britain had been in 1865 the same as that now maintained in the United States, the amount derived from taxation in that country would have been 1,424,184,840 dollars in place of 354,131,000." 33 The debt is managed without any regard to the interests of the people, or even to the ultimate profit of the exchequer. It is so confused and intricate that no one professes thoroughly to understand it. It offers six different rates of interest, and its bonds have nineteen different periods of maturity. There are no less than twelve different kinds of bonds carrying six per cent., issued under the authority of as many Acts of Congress. "Our public debt," says a recent writer, "is in such a state of confusion as to be entirely out of reach of the popular understanding, and correspondingly out of the popular confidence. Every contingency is turned into a trick of speculation. Rates, maturities, and liabili 83 Report of Mr. David A. Wells,' p. 43. The following statistical facts are given by this gentleman :— "The revenue derived from taxation in the United States in 1866 was 561,572,266 dollars; and the value of real and personal property, according to the census of 1860, 14,282,726,088 dollars. The amount of revenue derived in Great Britain from various forms of taxation in 1864-65, excluding the receipts from crown lands, postoffice, &c., was 354,131,000 dollars; the value of real and personal property, according to the census of 1861, being 31,512,000,000 dollars, the estimated increase of three per cent. per annum, or fifteen per cent., advancing the value in 1866 to 36,238,800,000 dollars. ties, are mixed together at every point, and it is not in the ability, if it were the interest, of dealers to explain them." 34 In addition to the Federal debt of over two thousand six hundred millions, there are the State debts, which make the burden on the American citizen very little less in amount than that which is borne by the British subject, while the mode of levying taxes is immensely more vexatious in America than in England.3 35 The commercial policy of the nation is equally unfavourable to the interests of the people. It is calculated that the American labourer pays from twentyfive to thirty-three per cent of his average earnings in direct taxation.36 The policy of protection and prohibitory tariffs, which the Republican party has made its own, is the only really serious clog which exists to the national progress. New England, the stronghold of protection, has suffered in some parts from its effects.37 The manufactures which have flourished 34 See a little work on 'The Public Debt of the United States,' by J. S. Gibbons (New York, 1867), p. 39. 35 The New Englander,' for August, 1867, estimates that the American citizen's share of the entire public debt is "within 3.59 dollars of the per capita of the more favoured British subject." The Evening Post,' of July 19th, 1867, complains that in the United States about sixteen thousand articles are taxed. Mr. Cox, an exmember of Congress, recently told the people of Ohio that in America the working man is taxed higher per head than in any other country in the world. 36 Evening Post,' 24th July, 1867. 37 See a pamphlet on 'The Collection of the Revenue,' by Edward Atkinson (Boston, 1867), p. 37. CHAP. XII. THE MISCHIEFS OF PROTECTION. 281 most in the United States-such as machinery, agricultural implements, and tools-are those which have never been protected at all.38 Production has been limited to an extent which alarms some of the Republicans themselves.39 The foreign trade of the country has declined with incredible rapidity. In 1853 the amount of American tonnage engaged in foreign trade was about fifteen per cent. in excess of that of Great Britain; at the beginning of 1867 it was more than thirty-three per cent. less. The decrease was thus nearly fifty per cent. The decline in the coastwise and inland trade has been about twelve per cent. Shipbuilding has been almost wholly transferred to the British Provinces. "Our finances," remarks a competent writer in an American journal, "have been managed in ignorance or in defiance of fundamental law. There is a universal torpor creeping over the industrial energies of the 38 See a pamphlet on The Collection of the Revenue,' by Edward Atkinson (Boston, 1867), p. 37. 39 'Mr. Atkinson obtained some statistics from Deputy-Commissioner Harland touching the number of persons in the United States paying income-tax, or, in other words, having an income of over six hundred dollars a year, in 1866; from which it appears that not over half a million out of a population of thirty-six millions have more than enough to support a family in the plainest way; of course, of these a large number must find it difficult to make ends meet at all. As long as America, although the richest country in the world, and that which presents fewest inequalities of fortune, has this story to tell, it can hardly be said that it does not need to produce more rapidly, or in greater abundance."-North American Review,' July, 1867, pp. 210, 211. nation. Manufactures are being rooted out, every department of trade and industry is languishing, the public revenues are being destroyed, and a huge debt accumulating abroad." So dear are all the necessities of life that the labouring man who emigrates to the United States scarcely ever improves his position, unless he has been unable to find regular employment in his own land.40 When the Federal government required only 60,000,000 of dollars a year, and obtained it chiefly by customs and land sales, the deductions from the earnings of the working man were inconsiderable. But now the central government raises over 500,000,000 by customs and internal revenue alone, and taxation, as we have seen, is very little lower than it is in England, while every article required for the household or the person is immensely dearer. It would be idle to suppose that these circumstances will not have any effect upon the future of the country; possibly they may be henceforth a fruitful source of bickering and strife between the various States whose interests are most injuriously affected. But the national debt was contracted for an object of which all approved, and all will aid in honourably discharging it. The poorest native-born American in the country would not willingly attach 40 "The industrial classes have been growing worse off, able to purchase less, and to save less; this poverty re-acts on both traders and manufacturers."-American Annual Cyclopædia,' 1866. CHAP. XII. ELASTICITY OF THE PEOPLE. 283 to the national name the everlasting stigma of repudiating liabilities which were incurred for the preservation of the Republic. If the day should arrive when their legislation is conducted by men of character and principle, their eyes will be opened to many of their present mistakes and delusions on questions of political economy. At present the people are saved from serious commercial troubles chiefly by their boundless confidence in themselves, and by their elastic temperament. They recover so soon from a blow that they never seem to feel it. Their business men marvel at the recurrent "panics which are so common in England, and are accustomed to say that the English merchants are losing their ancient courage. A banker once remarked to me, "If any people in the world are fairly entitled to a financial panic once a week, we certainly are that people. But we do not have it, because we know that we shall pull through." While they have this faith, they will be able to conquer their difficulties, or at least to meet them with spirit. The There are no dangers from without to threaten the Union, but it may be justly questioned whether the present generation have been so careful as their forefathers tried to be of the securities within. era of general agreement, and deep-seated satisfaction with the government, is more remote than it was in the days when the founders of the Constitution committed it with affectionate solicitude to the care of |