Year: 1869

general or common, are 30 convenient Tor gen.
eral and common use, that they often pass for
absolute governing truths. OF this sort is the
assumption that supply is regulated by demand,
and the other assumption that prices regulate
consumption. Neither of these propositions is
always true, but, on the contrary, they are
both very often false. In respect to luxuries,
generally, the supply to q great extent pro-
duces the demand In the fine arts, and in
matters of taste, including for the purpose of
this argument literature, news, theatrical re-
presentations, and fashionable dress and equip
age the supply provokes and leads the demand
The like influence is seen, Also as to the COM
modities usually classed as the necessaries
of life; tho demand for more of these and OF
better quality is greatly increased by their ex-
hibiton in the market Newspaper and other
forms of printed advertisements, show windows
and store signs, pay their cost with profit by
their efficiency in inducing demands toy-shops,
picture stores, new novels and magazines, as
well rs daily and other newspapers, are clear
instances of supply creating demand. But the
point is of less importance in reasoning upon
economical questions than the other whose
truth we are just now concerned to impeach-
the too prevalent notion that prices rule con-
sumption. The facts of experience broadly
contradict this opinion.


An English laborer is not induced by the
cheapness of commodities to consume the more
of them. The American laborer win use twice
the quantity at double the British prices. The
truth is that prices only affect consumption
when and where the conditions of the consumer
are the same. The mass of our population is
al halt oil fa1 otb Thor
wise furnished with necessaries and eDjoyments,
than they were in years gone by, when these
things cost only half of their present prices.
Indeed, careful review of the country's varied
fortunes will show that periods of very low
prices are periods of greatly diminished con-
sumption, carried even to the extent of serious
priyatOn, and accompanied with greatly dimn-
ished production and that the rule OF high
prices is marked by abundance in consumption,
and the answering abundance of production.
decided and wel-sustained rise in the prices
Of commodities is followed by prOportionate
appreciation of the value of land and labor,
neither of which are consumed, in the sense OF
being destroyed, in the use. On the contrary,
their whole value consisting in their product
iveness, whatever enhances this adds so much
absolutely to the stock of the general wealth,
aud such addition is sure to be distributed upon
the whole community. High prices OF food
may follow failure of crops, and bring no
relief with them; but in the commodities which
do not depend upon the seasons, scarcity is
never the cause of any injurious appreciation
Of market rates.


Neither does abundance Of production pro-
duce abatement of price, for it tends to induce
enlarged consumption. The grand regulatorof
all these movements and cause of these vari-
ent and apparently contradictory effects, rs they
are manifested in prices, supply, demand, and
consumption, is the ability of the people to
purchase and we must therefore look to the
industrial condition of the community for the
principles that rule them, and we must look to
it also for direction and remedy, ii we would
wisely manage the interests which are affected
by prices, supply and demand. Errors of opin-
ion in these matters lead to mischiefs in prac-
tice.


When free traders denounce a tariff or tax,
as obstructive or prohibitory of foreign trade,
they are saying nothing to the purpose, unless
such burdens upon or restrictions OF commerce
diminish the productiveness of domestic indus
try and the power of the people to consume.
They infer that enhancement Of prices, how
ever occasoned, must be followed by diminu-
tion of consumption, or of the ability to con-
sumo. This is a manifest non scqmtur, and it
is clearly contradicted by most ample expert
ence. If the cost of commodities Is doubled
by any cause or causes which carry up the
wages of labor and the other rewards of in
dustry at an equal rate, prices are no higher
in effect than if the products Of the precious
metals were so greatly increased that their
value in the market fell to ope-half in COM
parsOn with the value of other commodities
But If our reasonngs seem insufficient, we
present few facts upon which the objector
must try his own logic


In the fiscal year 1860 (the most favorable
year for the opponent in our commercial his
tory we imported for consumption of dutiable
goods to the value of $26S,OO0,000. The aver
age duty upon these goods was exactly nine
teen and six-tenths per cent. In the year 1868
we imported dutiabe goods to the value of
three hundred and fortyfour millions, the
average duties being torty-Seren and eight
tenthS per cent. Here we have an increased
import of 80 per cent under a rate of duty
within a fraction Of one and half times
greater Or if the difference will be better
understood and felt the duties of 1860
amounted to S52,750,0O0, and in 1868 to $780,
100000. This being the general result of the
highest rates of duty, combined with the high
est prices of our history, we in turn ask an
explanation from the people that speak of our
tariff as prohibtory, oppressive, .and destruc-
tive of commerce abroad and industry at
home