The Somerset reporter. [volume] (Skowhegan, Me.) 1868-1909, 1890-05-29
FREE RAW MATERIALS.
HOW THEY WOULD AFFECT OUR
MANUFACTURING INDUSTRIES

MANUFAC TURING INDUS Rlto,
Could We Compete Better In the Markets
of the worid?-our Cost of Production.
The whole Question One of Labor and
Wages.
The objection most urgently alvanced
against Protection to raw materials of
manufacture is that, entering AS they do
into 50 many different processes of manu-
facture, the price of the finished article
is increased to such an extent that we
cannot successfully compete with foreign
producers of like articles. In brief, it is
argued that if we had access to free raw
wool we might compete in our finished
wooden fabrics with England and the con-
tinent. II we had free iron ore, our fin
ished products, which contain large
amounts of iron, could compete with like
foreign made commodities. If all our
raw materials were free, our manufao-
.ured articles would find an extended
market, while our own people would be
benefited through receiving cheaper man
fractures. These arguments so plausi-
ply urged, depend, however, upon two
assumptions. The first is thai il the duty
on raw materials was remove the price
of such raw materials would he perma
nently reduced by the amount of duty
levied
The second assumption is that, with
raw materials of the same value As those
of foreign manufacturing countries, we
4 I'll . 100
of the world These two assumptions
we will examine in the order given. By
way of illustration we may cite the wool
growing industry. The tariT on raw
wool prevents the foreign producer from
destroying our wool growing industry.
If this duty were taken off, the foreign
producer could send his wool into our
ports at prices which would destroy the
American industry. After the Ameri
can industry was destroyed that part of
the demand before supplied by the
American producer would be transferred
to the foreign producer. With this in
creased demand for raw wool its price
would naturally and inevitabl, rise.
The same fact of productiol is clearly
Of Great Britain, which in som instances,
have been carried on at II positive loss to
their owners, in order to cnahlr them to
destroy American competition In re-
port Of the commissioner appointed to in
qure into the condition of the mining
districts of Great Britain, in 1854, we
find the following language used:
al L.l I,,t luh ola
generally in the manufacturing districs
of this country, and especially in the
iron and coal districts, are very little
aware Of the extent to which they are
often indebted for their being employed
at all to the immense losses which their
employers voluntarily incur in bad times,
in order to destroy foreign competition,
cign markets. Authentic instances are
well known of employers having in such
times carried on their works at Il loss
amounting in the aggregate to three or
four hundred thousand pounds in the
course OF "A few years.
After this competition has been de-
stroyed, the English capitalist not only
himself for losses sustained in destroy
ing his American rival. Reverting to
the illustration of wool, another feature
Of this same assumption is shown. Tho
American wool grower, encouraged by
reasonable Protection, introduces i'm
proved breeds Of sheep, and thus in
creases the average clip per head. As
this clip is 80 increased there results u
greater and more valuable product. This
increase must 20 to somebody. Either
the wool grower will retain 1t permanent
ly in greater profits, or competition ell
tering will lower the prices to an average
return for labor and capital expended.
1t is II law of production which Free
trader and Protectionist, must alike recoR-
nize that, when capital is as mobile AZ
now, the profits in any protected indus
try will not permanently remain above
the profits gained in other industries,
whether protected or not, which require
substantially equal capital, labor, skill
and other essentials Of production. As
result Of this law the increased facili-
ties for production of wool would cause
lowering Of price, while at the same
time the grower would be receiving aver
age profits.
Let us now examine the assumption
that with raw materials at the same price
which other nations pay we could sue
cessfully compete with them in the mar
kets of the world. Evidently therei is but
one way in which we could do this, and
that Is by selling the same article for the
same or less price. The cost Of raw
materials is not the only item that enters
into the cost of production of finished
commodity. There is the amount paid
as wages, the interest and risk on capital
sunk in the plant, its deterioration in
value and the cost of administration, all
of which must be accounted in determin-
ing the cost of production. The mate
rails which in their raw state represent
the value of dollar become worth many
times that amount when they have I'M
dergone number of processes of manu-
facture, and this increase in value is due
to the factors Of production just enumer-
ated.
According to The London Artisan Il
dollars worth of lead when made into
printing type is worth $50. An amount
of iron of like value when made into Or
namental work is worth $48; into scis-
sors. $3.50; into penknife blades, $3.50.
and into sword handles, $780, Even
hemp, which does not undergo very ex-
tensive processes of manufacture, and
which when finished is but a rough prod
uct, is worth four times its value as a
raw material. The same fact is further
illustrated in the case Of the raw mate
rails of our various textile and mechani-
cal industries.
OF the elements in the cost Of produce
ton, not the least is labor. The average
daily wages of the employees, including
men, women and children, in the manu-
facture of wooden goods in the United
States are $1.40, and In Great Britain 90
cents; in metals and metallic goods in
the United States, $3.50; in Great Britain,
>l.S5, and in Belgium, 90 cents; in car
petings In the United States, $1.61, and
in Great Britain, $1.20.
The arguments given in reference to
our manufacturing industries have been
negative, tending to show that they
would receive no appreciable advantages