Wood County reporter. [volume] (Grand Rapids [i.e. Wisconsin Rapids], Wis.) 1857-1923, 1891-10-15
FOUR ECONOMIC RULES.
Explanation of the Fact That Producers
Do not Profit at the Expense of the
People.

Explanation of the Fact That Producers
DO not Profit at the Expense of the
People.
1t has often been asked how protec-
! tive tariff, placed on necessities of life
which can be economically produced IN
/ this country and which the people have to
! buy, can profit the home producer of the
goods without making these goods cost
more to the consumer. 1t is natural that
the people should want to know how pro-
lection can put more money into the pro-
ducer's pocket without taking it out of
their pockets when they buy the goods.
Many are satisfied to accept the bare facts
| when shown that even on those classes of
necessary goods on which the Mckinley
bill increases the duties the prices have not
advanced, but on the contrary, in many
cases is lower than before the DILL was pass
ed. 1t is fair, however, that the general de-
mand for information should be gratifod,
and the more widely the knowledge is dis
seminated the greater favor will the pro-
lection system find. In recent number
of the American Economist, David Hall
Rice deals fully and clearly with this
question.
First, he refers to all articles of neces.
sity, such as are consumed daily by the
great mass CT the people. Protection is
not applied to them in order to Increase
the price to the final consumer, but, on the
contrary, to reserve the home market to
the competition of home producers, which
always has the effect to cheaper such
goods. How does protection accomplish
this result? A statement of three or four
very simple economic principles re-
lating to the manufacture and production
of goods that are accepted as true
by all mankind, because the experience of
every manufacturer has demonstrated
them to be true over and over again, will
show.
The first of these laws of production is
that goods can be manufactured cheaper
In larger quantities In tie same establish
ment by the aid of steam and machinery
than in smaller quantities. The second
is that in order to enable such larger es-
tablishment to so make these goods
cheaper, it must be kept going as near all
the time, day after day, week after week,
and year after year, as possible. This Is
so because the loss by depreciation, inter
est, taxes, repairs and scattering of skilled
workmen would add largely to the cost of
each yard or pound of goods made
if frequent or partial stoppages were COM
u.
the smaller establishment.
The third of these laws of production
is that in order to keep such large estab
lishments going economically there must
be certain and stable market for the
goods. substantially as fast as they are
made, at a fair price, SO as to cover the
expense of manufacture and return some
profit on the capital invested.
The fourth law is that the more certain
the market and the more certain the sale
of the goods, year after year, the smaller
the rate Of profit will be which the manu-
facturer can afford to reserve for him
self. If business was as certain in its
returns as government bonds, its profits
would sink to the same rate as their rate
of interest.
These four laws relating to production
of work with certainty and uniformity,
and if borne in mind and applied to any
instance that may be brought up, will be
found to demonstrate just what is claimed.
They will show, what is amply demon.
strated by the workings Of the Mckinley
bill, that to provide certain market f'r
the competition of home producers of the
necessities of daily life economies tho
charges in every branch of production and
fife in these goods, and that home COM
petition, as a rule, when insured the hrst
chance at the home market, bestows all
savings upon the ultimate consumer In
The shape of cheaper prices. st. Paul
Dispatch.