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carry　on　direct　with　Egypt；　Louisiana；　or　Brazil；　because　it　cannot



supply　those　countries　with　the　cotton　goods　which　they　require；



and　cannot　take　from　them　their　raw　cotton。　Furthermore；　these



articles；　on　account　of　the　magnitude　of　their　total　value；　serve



especially　to　equalise　the　exports　of　the　nation　tolerably　well



with　its　imports；　and　always　to　retain　in　the　nation　the　amount　of



circulating　medium　which　it　requires；　or　to　provide　it　with　the



same。　Thus　it　is　by　the　prosperity　and　preservation　of　these



important　branches　of　industry　that　the　industrial　independence　of



the　nation　is　gained　and　maintained；　for　the　disturbance　of　trade



resulting　from　wars　is　of　little　importance　if　it　merely　hinders



the　purchase　of　expensive　articles　of　luxury；　but；　on　the　other



hand；　it　always　occasions　great　calamities　if　it　is　attended　by



scarcity　and　rise　in　price　of　common　manufactured　goods；　and　by　the



interruption　of　a　previously　considerable　sale　of　agricultural



products。　Finally；　the　evasion　of　customs　duties　by　smuggling　and



false　declarations　of　value　is　much　less　to　be　feared　in　the　case



of　these　articles；　and　can　be　much　more　easily　prevented　than　in



the　case　of　costly　fabrics　of　luxury。



　　　　Manufactures　and　manufactories　are　always　plants　of　slow



growth；　and　every　protective　duty　which　suddenly　breaks　off



formerly　existing　commercial　connections　must　be　detrimental　to　the



nation　for　whose　benefit　it　is　professedly　introduced。　Such　duties



ought　only　to　be　increased　in　the　ratio　in　which　capital；　technical



abilities；　and　the　spirit　of　enterprise　are　increasing　in　the



nation　or　are　being　attracted　to　it　from　abroad；　in　the　ratio　in



which　the　nation　is　in　a　condition　to　utilise　for　itself　its



surplus　of　raw　materials　and　natural　products　which　it　had



previously　exported。　It　is；　however；　of　special　importance　that　the



scale　by　which　the　import　duties　are　increased　should　be　determined



beforehand；　so　that　an　assured　remuneration　can　be　offered　to　the



capitalists；　artificers；　and　workmen；　who　are　found　in　the　nation



or　who　can　be　attracted　to　it　from　abroad。　It　is　indispensable　to



maintain　these　scales　of　duty　inviolably　；　and　not　to　diminish　them



before　the　appointed　time；　because　the　very　fear　of　any　such　breach



of　promise　would　already　destroy　for　the　most　part　the　effect　of



that　assurance　of　remuneration。



　　　　To　what　extent　import　duties　should　be　increased　in　the　case　of



a　change　from　free　competition　to　the　protective　system；　and　how



much　they　ought　to　be　diminished　in　the　case　of　a　change　from　a



system　of　prohibition　to　a　moderate　system　of　protection；　cannot　be



determined　theoretically：　that　depends　on　the　special　conditions　as



well　as　on　the　relative　conditions　in　which　the　less　advanced



nation　is　placed　in　relation　to　the　more　advanced　ones。　The　United



States　of　North　America　e。g。　have　to　take　into　special



consideration　their　exports　of　raw　cotton　to　England；　and　of



agricultural　and　maritime　products　to　the　English　colonies；　also



the　high　rate　of　wages　existing　in　the　United　States；　whereby　they



again　profit　by　the　fact　that　they　can　depend　more　than　any　other



nation　on　attracting　to　themselves　English　capital；　artificers；　men



of　enterprise；　and　workmen。



　　　　It　may　in　general　be　assumed　that　where　any　technical　industry



cannot　be　established　by　means　of　an　original　protection　of　forty



to　sixty　per　cent　and　cannot　continue　to　maintain　itself　under　a



continued　protection　of　twenty　to　thirty　per　cent　the　fundamental



conditions　of　manufacturing　power　are　lacking。



　　　　The　causes　of　such　incapacity　can　be　removed　more　or　less



readily；　to　the　class　more　readily　removable　belong　want　of



internal　means　of　transport；　want　of　technical　knowledge；　of



experienced　workmen；　and　of　the　spirit　of　industrial　enterprise；　to



the　class　which　it　is　more　difficult　to　remove　belong　the　lack　of



industrious　disposition；　civilisation；　education；　morality；　and



love　of　justice　on　the　part　of　the　people；　want　of　a　sound　and



vigorous　system　of　agriculture；　and　hence　of　material　capital；　but



especially　defective　political　institutions；　and　want　of　civil



liberty　and　of　security　of　justice；　and　finally　；　want　of



compactness　of　territory；　whereby　it　is　rendered　impossible　to　put



down　contraband　trade。



　　　　Those　industries　which　merely　produce　expensive　articles　of



luxury　require　the　least　consideration　and　the　least　amount　of



protection；　firstly；　because　their　production　requires　and　assumes



the　existence　of　a　high　degree　of　technical　attainment　and　skill；



secondly　because　their　total　value　is　inconsiderable　in　proportion



to　that　of　the　whole　national　production；　and　the　imports　of　them



can　be　readily　paid　for　by　means　of　agricultural　products　and　raw



materials；　or　with　manufactured　products　of　common　use；　further；



because　the　interruption　of　their　importation　occasions　no



important　inconvenience　in　time　of　war；　lastly；　because　high



protective　duties　on　these　articles　can　be　most　readily　evaded　by



smuggling。



　　　　Nations　which　have　not　yet　made　considerable　advances　in



technical　art　and　in　the　manufacture　of　machinery　should　allow　all



complicated　machinery　to　be　imported　free　of　duty；　or　at　least　only



levy　a　small　duty　upon　them；　until　they　themselves　are　in　a



Position　to　produce　them　as　readily　as　the　most　advanced　nation。



Machine　manufactories　are　in　a　certain　sense　the　manufacturers　of



manufactories；　and　every　tax　on　the　importation　of　foreign



machinery　is　a　restriction　on　the　internal　manufacturing　power。



Since　it　is；　however；　of　the　greatest　importance；　because　of　its



great　influence　on　the　whole　manufacturing　power；　that　the　nation



should　not　be　dependent　on　the　chances　and　changes　of　war　in



respect　of　its　machinery；　this　particular　branch　of　manufacture　has



very　special　claims　for　the　direct　support　of　the　State　in　case　it



should　not　be　able　under　moderate　import　duties　to　meet



competition。　The　State　should　at　least　encourage　and　directly



support　its　home　manufactories　of　machinery；　so　far　as　their



maintenance　and　development　may　be　necessary　to　provide　at　the



commencement　of　a　time　of　war　the　most　necessary　requirements；　and



under　a　longer　interruption　by　war　to　serve　as　patterns　for　the



erection　of　new　machine　factories。



　　　　Drawbacks　can　according　to　our　system　only　be　entertained　in



cases　where　half…manufactured　goods　which　are　still　imported　from



abroad；　as　for　instance　cotton　yarn；　must　be　subjected　to　a



considerable　protective　duty　in　order　to　enable　the　country



gradually　to　produce　them　itself。



　　　　Bounties　are　objectionable　as　permanent　measures　to　render　the



exports　and　the　competition　of　the　native　manufactories　possible



with　the　manufactories　of　further　advanced　nations　in　neutral



markets；　but　they　are　still　more　objectionable　as　the　means　of



getting　possession　of　the　inland　markets　for　manufactured　goods　of



nations　which　have　themselves　already　made　progress　in



manufactures。　Yet　there　are　cases　where　they　are　to　be　justified　as



temporary　means　of　encouragement；　namely；　where　the　slumbering



spirit　of　enterprise　of　a　nation　merely　requires　stimulus　and



assistance　in　the　first　period　of　its　revival；　in　order　to　evoke　in



it　a　powerful　and　lasting　production　and　an　export　trade　to



countries　which　themselves　do　not　possess　flourishing　manufactures。



But　even　in　these　cases　it　ought　to　be　considered　whether　the　State



would　not　do　better　by　making　advances　free　of　interest　and



granting　special　privileges　to　individual　men　of　enter　prise；　or



whether　it　would　not　be　still　more　to　the　purpose　to　promote　the



formation　of　companies　to　carry　into　effect　such　primary



experimental　adventures；　to　advance　to　such　companies　a　portion　of



their　requisite　share　capital　out　of　the　State　treasury；　and　to



allow　to　the　private　persons　taking　shares　in　them　a　preferential



interest　on　their　invested　capital。　As　instances　of　the　cases



referred　to；　we　may　mention　experimental　undertakings　in　trade　and



navigation　to　distant　countries；　to　which　the　commerce　of　private



persons　has　not　yet　been　extended；　the　establishment　of　lines　of



steamers　to　distant　countries；　the　founding　of　new　colonies；　&c。







Chapter　27







The　Customs　System　and　the　Popular　School







　　　　The　popular　school　does　not　discriminate　（in　respect　of　the



operation　of　protective　duties）　between　natural　or　primitive



products　and　manufactured　products。　It　perverts　the　fact　that