New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1870-02-09
RELATION or TARIFFS, IMPORIS, AAD
CURRENCY 81

currence of the quantity OF foreign imports,
and the amount of the currency in circulation,
as they are shown in our financial and COM
mercial history, furnishing statistics In proof
of the close connection in the two most nota-
BILE periods of expansion Immediately preced-
ing the reyulsions of 1887 and 1851. In his
tabular statement he embraces both clrcula-
ton and deposits, and his imports also en-
brace specie. Even with this complication, his
figures sustain his general averment that there
is close relation between our imports and the
volume of our circulation, when no such causes
as the necessities of the Treasury in war, and
the recent vast expectation of public securi-
ties, disturb the affinity between them.
The relation Of concurrence has held won
derfully in our experience from the close OF
our last war with Great Britain to the begin
ming Of the Rebellion but the Senator, we
think, is somewhat in error in holding that the
expansion of the currency is the cause OF, or
precedes, excessive importations and espe-
cially in error in saying that "the bearings OF
"the tariff do not touch this point" we pro-
pose to show, on the contrary, that, from the
year 1928, down to 1850, through the periods
of two Protective and two Free-Trade tariffs,
in regular alienation, first, that the rates OF
customs duties rule the volume Of thel foreign
imports second that the volume or value OF
the imports rules the amount of the currency
and all its consequences; and thirdly, that
certain other financial phenomena clearly
establish the precedence of the foreign I'M
ports in the confederation of causes and ef-
fects throughout all the great changes in our
economic affairs.
In the treatment of the question, we shall ex-
clude the specie account from the imports, and
the bank deposits from the currency. The
inclusion of the specie imports through period
that overlaps the discovery of precious metals
in California, and the treatment of deposits as
currency, complicate the question unnecessarily,
though it happens that doing so does not
materially vary the results.
First of the relation between the value OF
the foreign imports and tho amount of cur
rency in circulation, under our two highest and
two lowest Tariffs prior to 1860 1.-THE amounts
in millions and tenths of millions of dollars.
UNDER THE TARIFF OF 1923 AND THAT OF 1912.
1922 Av y'rly imp'ts 1902 Av. blk notes SOLO
lS43A45 Av y'rly mpts.. 1901. .Av. blk notes 622
1884 81 Av y'rly Impts tls8 Av. bk sl22o
1878 go Av. yrly mpts S2t2 Ay ok notes 1875
note circulation per capita In dollars and cents.J
UNDER TARIFFS OF 1928 AND THAT OF 1912
isiS 40 Av consumption %. .Av. oirculatn. IS
UNDER COMPROMISE TARIFFS or 1873 AND II:AT OF 1851
1884, 81 Av. consumption y IS. .Av. ciroulatnG As
1851, 49, Av. consumption 10 40 Av crcuiatn -
Averages are always inaccurate, more es-
pecially in matters subject to great fluctuations.
Sometimes, where errors of brevity and clear
ness of statement can be afforded, as in the
present case, they may be adopted, though
they have the vice of leveling fluctuations,
which are the strongest features of the matter
in hand.
Let us look at shorter periods in which the
contrasts of the systems of duties and the con-
currence of the effects are still holder, and so
much the more just as they are nearer in cause
and effect:
In the years 1880, '31, $50, heforegn imports re-
tanned for consumption aggregated S207, 100000;
the note circulation stood at SCI, OOO, 900; the
total duties upon the imports averaged 80 per
cent. In the years 1867, the aggregate i'm
ports for consumption rose to $314,100,000; the
circulation, at the highest, $l49,0O00o0. and the
total duties were % per cent. Here we have
the imports increased so per cent, the duties
reduced so per cent, and the average circulation
nearly doubled. Then came the revulsion of
1887 Of imperishable memory.
Again-the aggregate imports for consump-
ton in the years 1874, ., Is, were 1912 900 900,
the circulation 800 900 900, and the average duties
292 per cent but nine years later under the tariff
of 1S46,,the imports rose in the aggregate of
the years 1866, o. Y to ss6O,sOO,OOO the circu-
laton to an average of $199OO0,OOO, and the
duties on the duty paying goods were down to
234 per cent. Whereupon followed the revul-
sion of 1857. Here again, after lapse Of nine
years, three times longer than the interval Of
the former periods cOntrasted, for which allow
ance should be made for the greater growth of
wealth and population, we have an increase of
the imports of 175 per cent. and corresponding
increase of the circulation of 12l per cent, with
average duties % per cent. lower.
Here again the ineradicable vice of general
averages appears. The duties upon woolens,
cottons, hempen goods, iron and manufactures
of iron. in 1874, %. g, were 1874 per cent, and
in 1855, ., Y, only 27.2 per cent.-a reduction
in the protective duties on goods which covers
almost the entire system of American protection
of Al per cent, instead of the % per cent. of the
general average upon all imports; none of which
are important to our industry except those
charged at the highest rates.
The California gold, the Crimean war, and our
freedom from extraordinary expenditure, length
ened the run of the tariff of 1916; else we should
have had its catastrophe earlier and tho pro-
portion between the circulation and the imports
still nearer. The critical years of our financial
history best show the connection between ex-
cessve imports, expanded currency, low tariffs,
and the resulting business catastrophes the
years 1916, 1886, and 1856. and their respective
sequels, in duration and severity, show equally
well the dependence of all our grand explosions
unon fba foraiUa frada M THAR rool yrin,.r,,