The silver state. [volume] (Winnemucca, Nev.) 1909-1925, 1916-05-02
HOW SMALL IMPORTS
DEMoRALIZE OUR MARKETS

1t is one of the misfortunes of the
Democratic party that its economic
policies are framed chiefly by men
who have had no practical experience
in business, but who form their opin-
ions from an abstract study of eco
Monies. 1t is not surprising that men
who thus form their opinions are i'm
pressed with the argument that since
imports of foreign commodities con
stitute but a small per cent of the to-
tai amount of those commodities sold
and consumed in this country, such
imports can have no material effect up
on prices received by the American
producer.
Men who have had practical expert
ence in business know better. A very
small excess of supply will demoralize
a market. To take a local and easily
understood illustration, let us suppose
that in a certain community there is
in the strawberry season a market for
10000 crates of strawberries. If the
producers of that community have
1900 crates to sell, the excess 1000
crates, although small in proportion 10
the total, is sufficient when rushed
upon the market, to bring the price
down below the cost of production.
With a market demanding 10000
crates and a 9,000-crate crop, the fruit
could be sold at a large margin of pro-
fit, while an II, 000-erate crop would
be sold at a loss. Theoretically, 1900
crates would be worth more than 5000
crates; practically, they are worth less
when the market is flooded.
That is exactly the situation present
ed under a free-trade policy in this
country. While it is true that the i'm
ports from foreign countries are small
in proportion to the total consumption,
these imports, together with the stocks
held in foreign countries ready to be
dumped upon our market, constitute
IN excess which bears down the price
the producer is able to demand and
forces him to sell at a loss.
1t is not a sufficient answer to this
to say that strawberries, for example,
are a perishable crop, while wooden
goods are not. From an economic
standpoint a stock of wooden goods is
~perishable, for the reason that the
owner must pay interest upon his
money, must pay insurance upon his
stock, and is very likely to sustain a
loss through change of styles. Wooden
goods need not be sold so quickly as
Strawberries, but they cannot be held
over from season to season notwith-
standing they are not perishable in
the same sense that strawberries are
perishable. The manufacturer who has
paid out his money for labor and raw
material u sell his goods at a profit
within a reasonable time, or he must
close his factory. He is confronted by
a condition, not a theory.
Under a free-trade policy not only
the goods that have been manufaetur-
ed but those that can be manufactured
on the other side of the ocean ,consti-
tute a standing surplus constantly
menacing the market of the American
producer. That surplus, small though
it may be, stands in the same relation
to the entire output of the American
manufacturer that the excess of straw
berries bears to the total crop that is
offered for sale on a flooded market.
The theorist cannot understand this.
The man who is experienced in prac-
teal business knows only too well that
it is true.