The Birmingham age-herald., 1912-07-22
TARIFF AS BASIS
 OF HIGH PRICES Rooney's Figures Sustain Contention of Democrats CITES FEW EXAMPLES What Is Known as Drawback Sys- tenn" Operates to the Disadvan-
 tage of Every American Consumer
Consumer

l Consumer
 Eg
 1 C. E. STEWART
 VI ton. July 21.-(special )-That
 thf Q 2 cost of living Is due most of
 al ~, he tariff, and that the existing
 t$9 nay be reduced to a revenue basis
 Q 1t disturbing business or bringing SS a reduction of wages in this coun- Q is shown by a table prepared by John
 ome Rooney, in the New York Times,
 lich gives the differences In prices pre-
 vailng when an article of American
 manufacture is sold for export, and for
 domestic United States use. These fig
 ures he obtained from the tariff reform
 committee of the Reform club. of New
 York, and are from actual export price
 lists. MT. Rooney says in part
 High and higher prices must result
 from the system of taxing, whether
 through the tariff or otherwise, the raw
 material of industry and the machinery l necessary to production. This is our l situation today in the United States on a
 vast scale: in truth there Is scarcely |
 or partly advanced in process of manu-
 facture, that does not bear a tax ranging from 20 to 60 per cent.
 Lead Ore as an Example l Take lead ore for example Under the Payne-Aldrieh tariff a rate of duty
 is levied of 1ls cents per pound on the lead contents. This is equal to 63 per l of 1ralt of Ina "a actual importations during the year 1ol1
 But 1t does not require much knowledge lu that such a toll must not be re- flected in the price of all lead products must add to the price in the Ameri- can markets. Not that a large duty revenue can flow from such rate on a crude product, only s54.262.91 being col- lected by the treasury the-efrom. but
 the effect is felt in the lifting of the
 price of the entire American production ] of the ore
 Why should there be surprise R inc
 price epf lead pipe and all lead produc-
 tions rise under such conditions? Yet | this is q mild illustration of the price. l lifting process at the base of all our 1 production and industry. I say all be- cause each industry must use as raw material the finished or part-finished pro.
 ducts of other lines of production. = IdlntS and COiOrS Consider the paints and colors nanu- facture. An inspection of the rates of tariff duties actually levied last year on the raw materials of these industries show range of 10 per cent up to 61.23 per cent and, of course, the heavy tas upon lead bears with great weight upon these industries Then, as an offset, these in- dustries hold in the tariff heavy duties as protection on the finished article of manufacture. This offset or compensa- ton raises again the price level of the 1 commodity.
 Industries in control of the domestic source of raw material, a rare situation l in the aggregate number, have a special | point of advantage. The price to the consumer Is not and need not be lowered because of this economic advantage un- l less domestic competition becomes active I In such a case combinations to sustain
 the price level occur. the direct induce
 ment thereto being the tariff tax upon
 the foreign finished article.
 The Drawback System Manufacturers using imported material which is further manufactured here and l the product exported have received for
 many years under our tariff system a re- l bate or refund of go per cent of the duty l paid on the imported material. This fig
 known as the drawback system.' The | government retains only per cent of the | duty taken. for example, on tin plates where tin can made therefrom in the United States is exported. But when the
 tin can is sold to the American consumer, say, filled with fruits. the full effect of the tax, on tin plates is felt in the price. There is no drawback to the
 American consumer. He pays the duty, or sum equivalent to the duty. wheth- CT the can is made of foreign or do- | mestic tin.
 'Is there any wonder that prices are higher in our markets than in foreign markets, even on our own products, after paying heavy costs of transportation and additional profits through handling? If American produced raw material IS used in manufacture no drawback is paid on exportation of the manufactured product No duty has been actually paid hence no refund. The enhanced price of the domestic material heavily handicaps 1t for the export trade. The drawback
 system of course, puts heavy premium on the use of imported material for use in the manufacture for export Tn the important item of steel rails there is difference of from s6 to s per ton In favor of foreign railroads using our American produced rails. A like discount of lower prices runs through the entire list of supplies. The cost of renewals ana construction of our railroads constantly rises. Hence the complaint of the rail- roads that their freight rates should be advanced. The merchant and shipper op- pose these advances. railroad renewals and extensions halt, are undertaken at least in half way manner "Meanwihel the products shipped over our railroads already bear freight rates artihcially advanced in the past by the abnormal cost of railroad con- struction and repair
 Quotes North's Statement In a statement of J. A. Hobson un der the caption of the Fruits of Amer lean Protection." he quotes S. N. D North, director Of the census of 1900 writing in the Annals of America n Academy of Political and Social Science
 January. 1900. Here Is MT. North's statement.
 "It remains the fact that constant ly increasing number of our great man. ufacturing corporations are construct 1 ing vast plants abroad to supply their foreign customers: and. of course. they would not do this unless experience proved there was an advantage in it I have before me long list of these esta hlishments.
 "It indicates that more than s4o.-
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