The Rock Island Argus. (Rock Island, Ill.) 1877-1885, 1881-04-23

The effect of protection is disastrous to
most of the protected industries them
selves. We have seen that many of them
have in recent years been compelled to
diminish production. The cause of this is
manifest. Production confines them to the
American market. The high prices they
are compelled to pay for protected mater
ials which enter into the manufacture of
of their products disable them from going
into the foreign market. The profits which
they make under the first impulse of pro
lection invite others into the same business.
AS a result, therefore, more goods are made
than the American market can consume.
Prices go down to some extent through the
competition, but rarely under the cost of
production, increased as we have seen, by
the enhanced price of material required.
The losses threatened by such competition
are sought to be averted by the
diminutiOn of production. Combin-
ations of those interested are formed
to stop work or reduce it until the
stock on hand has been consumed Pro-
duction then begins again and continues
until the same necessity calls again for the
same remedy. But this remedy is arbitrary,
capricious, and unsatisfactory. Some will
not enter into the combination at all. 9th
ers viii secretly violate the agreement from
surplus stock has been sold, and before the
general price has risen, will begin to man
ufacture again. There is no power to en-
force any bargain they have made, and they
find the plan only imperfectly curing the
difficulty. They remain uncertain what to
do, embarrassed and doubtful as to the flu
ture. They have through protection VIC
lated the natural laws of supply and de
mand, and human regulations are powerless
to relieve them from the penalty.
Take as an illustration of the operation
of the system, the article of paper. One
of the first effects of the general tariff was
to increase the price of nearly everything
the manufacturer required to make the pa
per. Fifteen million dollars year through
the protection are taken from the consul
mer. The manufacturer himself is able to
retain but small part of it. as he is oblig-
ed to pay to some other protected industry
for its products, they in turn to some 9TH
ers who furnish them with protected arti-
Giles for their use, and so on to the end
The result being nominal prices are raised
all around; the consumers pay the fifteen
millions, while nobody receives any sub
stantial benefit, because what one makes
in the increased price of his product he
loses in the increased price he is obliged to
pay for the required products of others.
The consumer is the loser, and though
competition may occasionally reduce prices
for him to reasonable rate, it never to
any appreciable extent compensates him
Tor the losses he sustains through the en-
hanced price which the protective system
inevitably causes.
1t is not to be disputed that many of the
protected manufacturers have grown rich.
In very many cases it can be demonstrated
that their wealth has resulted from some
patent which has given them a monopoly
in particular branches of manufacturing, or
from some other advantage which they
have employed exclusively in their bust
ness. In such cases they would have pros
pered without protection as with it. There
are few, except in the very inception of a
manufacturing enterprise, or in abnormal
cases growing out of war or destruction of
property, or the combinations of large