|
On True Political Economy
(The Whole-Hog Book)
John Wilson Bengough
1908
| |
Notes and Links
|
CHAPTER VIII: THE
PLAN TO KEEP OUT GOODS
|
|
| The High Tax plan has in view, not to get funds for the State, but to
keep out strange goods and so tend to build up trade at home. This is to
be done, of course, in a way that is fair to each and all trades — to
treat them all the same; to
aid all and hurt none. Such
is the aim. |
tariffs, justice, barriers to entry |
| Now, we must ask in the first place, Is it well to shield the trade of
the land at all? And in the next place, if so, is this plan the best by
which that can be done? For, of course, this is not the only plan that
might be thought of. Let us grant for the time that it is wise to thus
shield trade. It can be shown that this can be done at least as well by
bounty as by Tax, and with scarce any of the evils of the Tax plan. |
protectionists |
| By the Bounty Plan: --
1. We could give aid to each and all trades, and to each new one as
it sprang up.
2. We would not have to give the aid till the trade had shown that
it had a right to it.
3. We would know just how much help each got and what had been done
to earn it.
4. We could stop the doles when they had been kept up a fair length
of time.
5. The doles, while fair to each and all lines of trade, would cost
far less than has to be paid by the Tariff plan in the form of high price
for goods.
6. We would not need the army of guards, spies, clerks and so forth,
and could save what we now pay them.
7. There would not be the same scope for fraud and lies and false oaths.
8. There would not need to be any rise in the price of goods. |
subsidies, privilege, tax
evasion, privacy, tax
efficiency, prices, canons
of taxation |
| Here are at least eight points which the plan of Doles can claim to score.
For,
in the case of the High Tax plan: --
1. The wit of man can not so fix it as to help all trades in a fair
way. What helps one hurts the next. If you put a tax on tools to help
the trade that makes tools, you, of course, hurt the trade that has to
use such tools, and as new trades spring up this mess grows worse and
worse.
2. Aid has now to be lent to new trade, as pap is fed to babes, and
it is a case of pay, pay, pay, till the child is grown up. But, strange
to say, it does not grow up at all, but with each year of its age, calls
for more and more pap.
3 No man on earth, let him be wise as he may, can tell what is paid
now to any one trade by the Tax plan, nor what they do for what they
get.
5. There is nought so hard to get rid of as a tax once put on goods.
It will grow, but it will not come off.
8. A rise in the price of goods is the heart of the whole scheme. If
there were no such rise where would the "aid" come in?
|
subsidies, corporation
privileges, prices, cost
of living, |
| It is hard, in short, to know what can be said for this plan. Some few
pleas are made, but these have the slight fault that they are not true. |
|
| (a) It is said that we who put up the wall do not have to pay the tax
on the goods that come in; that is paid by those who send them. There is
not one such case which is of any use to our home trades. The tax can only
aid the home trades when it puts up the price and thus gives them a chance
to get more gain, but the only case in which the man who sends in goods
pays the tax is one in which the price does not go up. Here is a man in
France who makes a pill. No one else knows how to make it, so he sets the
price as he likes at some point twixt what it costs him and what he can
charge so as to sell any. If the U. S. puts a tax on pills, it would be
for him to send no more pills in, or to pay the tax out of his own purse
so that they could still be sold in the States at the old rate. But what
good would that do those who make pills there? Or here is a case of a man
who has wheat to sell and he deems it best to sell it in a land that is
near by. Though he pays the tax on it, there is no rise in the price, as
the land he sells in has wheat to spare. What good does this do to the
wheat men of the land? A rise in price is what they want. |
prices |
| (b) It is said, too, that a high tax wall does not make things dear,
as it tends to cause more mills to spring up, and these fight for the trade
and so bring down the price to what it was at first. Why do more mills
spring up, if not to share in the gain from the rise in price? No doubt
the fight that in due time takes place (if they do not all join in a Trust)
brings down the price, but not to a point so low as it would be if the
wall had not been put up — if there was no tax on the thing made. |
prices, monopoly |
| A tax can not fail to raise the price of that on which it is put, in
the whole range of goods that are sent in from o'er the sea. It is only
in the case of "goods" of a rare kind that this may not take place. If
a stamp tax were put on the press it may be the Times would cost no more
than it now does, for the firm that owns the Times might choose to keep
the price as it is so as to hold those who now read it, and to that end
would pay the tax and not charge it in the price. But the Times is a rare
sort of "goods." |
cost of living, prices |
| So much for the tax plan. We see that it is not at all so good as the
Dole plan would be, and we have come far short here of all that might be
said with truth of its bad points. If it is wise at all to shield the trades
of a land let it by all means be done by fair and square doles paid out
of a poll tax or a straight tax in some form. |
canons of taxation |
| But we have now to ask, Is it, in any case, and by any plan, wise to
try to "shield" trades and thus aid them to grow? |
|
CHAPTER IX: IS IT WISE? |
|
| For what trades should we set up the shield, for a few or for all? On
this point there are two views held. Some say that only new trades should
be thus dealt with, to give them a chance to get well on their feet; but
the view held by most is that "home" trade as a whole should thus get help. |
barriers to entry |
| As to the first. It has been found, where tried, that when once these
Babes get a taste of pap, they will not let go. But there is no doubt that
there is here and there a Work that is hard to start, but which, if once
put on its feet, would be a great boon. The thing is to pick these out.
No doubt there are men all round us who, if they got the right help — if
they were put at ease, and had time to read and think and plan — would
come to be great men, and give back to the world much more than they have
got. But the thing would be to find just the right men. Who could pick
them out? If it were left to a free fight for the aid we may be sure the
right ones would not not win, but it would go to those who had the most
cheek or push or help from friends. So it is with aid to trades. No one
can tell just which it will pay to help, and in the fight the strong gain
the prize. Babe trades have just as much chance as young pigs would have
in a scrap round the trough with full grown swine. And in any case it is
not more sure that aid will do a young trade good than that it will be
wise to give great wealth to a young man as he starts out in life. It oft
proves a curse to him. |
subsidies, special interests, privilege, corporation privileges |
| Since, then, we can by no means pick out the young trades for aid, we
must give help to all or none. We come, then, to the next view, that "home" trade
at large must have aid. |
|
| Now, it is clear in the first place that, as the aid is to take the form
of a tax on goods sent in, which goods are made or could be made at home,
it will be seen that we can only in any case aid some trades — those,
that is to say, which make goods of the kind that is brought in. Here is
a man in the live stock trade. He has a big stock farm which he runs at
great cost, and which gives work to scores of men. If we are to aid all
trades we can not pass by this one. But (in the case of the States) live
stock is not brought in at all, it is only sent out. How, then, can a tax
on live stock aid this farm? And when we come to trades of the land are
in the same of the whole list there are just a tax. So to talk of aid in
this way to all is to talk stuff. If our plan was aid by means of Doles
we could treat all in a fair way, but it is the Tax plan we have now to
deal
with. |
tariffs, subsidies |
In face of the hard fact thus set forth, does not the case for the
High Tax plan at once fall to the ground? "Oh, no," cry its friends. "Of
course the tax can only give help to some trades (those in their goods)
but yet this times will be made good all round." What do you think of
this plea? Let us put the case in this way: Here is a small town where
times are dull. Two smart men live there, and they rise up and one of
them says:
"Friends, things are in a bad way here,
and we want to make good times for you all. This is our plan. Let each
one in the town pay us a tax of three pence per day. It is not much,
and you will scarce feel it. It will be but a small sum even for those
of you who have wives and kids to pay for. Yet this slight tax will,
as you may see, give our town two rich men in a short time, to wit, self
and friend. We will turn to and spend our wealth. We will be quite free
with it. We will buy the best food and drink, and lots of it; we will
build fine homes, lay out parks and grounds, give fetes and treats, and
play the part of lords in all ways. This will make trades brisk, and
call for work of all kinds for which we will pay well. The high pay you
will get will give you in turn a chance to live well and spend more in
the shops, so that things will look up for those who work farms, and
in short make things hum all round."
What, think you, the folk of the town would say to all this? Would they
not say: "You two chaps must take us for fools!" Yet there is as much
to be said for this scheme as can be said for the plea that to aid some
trades is to aid all. |
special interests, privilege |
| But let us take it that a High Tax could be made to aid all. It would
then do what we see could be done by the plan of Doles we speak of — that
is, each could get a fair share of help from the top to the foot of the
list. Well, what then? Let us take such a plan in the case of this same
town and see how it would work. Each man there would pay a tax to each
trade, but, of course, when he came to count up the whole sum he thus paid
he would find it far more than came back to his own hand as his share,
or, at most, he would get back no more than be had paid out. It is plain
that this would be the case of much cry and no wool. You can see how it
works out when you think of
aid to all; but when, as by the High Tax plan the aid goes but to a few,
you do not see the fraud on you quite so well. You see the big Works with
the tall stack which sends forth the black smoke and is so hard at it from
morn till night, and you say - see there! What a fine thing it is to thus
build up a trade and "give work" to such a crowd! But you do not see that
a share of that tax goes out of your own pouch and does not come back to
it; nor do you see that the waste and loss of such a "plan of aid" adds
to the cost of all you have to pay with the part of your wage you have
left. It is true a High Tax makes "more work." But so does the rain that
wets the hay on a farm. |
|
CHAPTER X: AS TO HOME TRADE |
|
| To say "let us keep our marts for our own trades, and bar out the goods
that would come to us o'er the sea; let our own land make all the goods
it needs, and so keep our cash in our own purse," this (which we hear so
oft, and which is thought so wise) is the same as to say, "let us keep
our mouths for our own home-made bread," or or "let keep our trips our
own legs make." |
|
| Our lives are full of wants, and these we seek to meet. If we are sane
we seek to meet them in the best way, and that is time, or toil, or both.
A man who would walk round a block when he could take a short cut to the
place he had in view would be a mere dunce. The man who would not ride
though he was in haste, so that he might use his own legs, we would call
a fool. So good sense bids us make or buy the things we need in our own
land, if it best suits us to do so; if it does not so suit us let us buy
where we please. Is not sense our best guide as to the way in which we
shall get the things we have need of? If we are to work out this rule to
the end, what of all those things which are not to be had at all in our
land? Are we to just go in need of them? This is so mad an idea that no
one will act on it. Sense tells us once more that the way to get
things is to set our hands to the sort of work we can do best, and then
trade
the things we make (and which we do not need) for the things we need, but
can not make. You need salt, let us say. Will you then make it in your
own land; dip a pot of brine out of the sea and boil it till all goes off
in steam and leaves the salt, or will you trade the boots and coats you
can make for the salt which is got from mines in far off lands? It would
be just as good sense to say that the world ought to be cut down just to
the size of our own land. It is not more wise for a land to try to "make
all things it needs" than for a man to do so, and of a truth it is not
the way in which
God meant us to act. |
human desires, man seeks, trade, division of labor |
On what grounds is it held, then, that we should keep home trade for
home marts?
On three:
1. That home trade has more gain in it.
2. That even though the high tax on goods puts up the price of goods made at
home, the real cost is no more.
3. Even if it were more, those who pay it get it back. |
|
I. That there is more gain in a trade twixt John Bull and Pat than there
would be in the same trade twixt John Bull and Hans is not true. Good sense
laughs at it. |
|
| II. The "real' cost" of a thing is not set by the more or less toil it
took to make it, but by the toil it would take to make what you could get
it for. A man who could make a pair of boots well and in a short time,
if he should try to make a coat, would do the work ill and take far more
time. The coat would be
dear. It would not be
sold at its "real cost" for that would be the worth of what the man could do
in the boot line with the same toil and time. A good part of the price would
be mere waste of skill in a wrong line, and thus it is with the price of goods
made at home that could best be made o'er
the sea and got in trade. |
division of labor, prices |
| A man who is thought to have had a great head [Horace
Greeley] once said, "I need iron and I must buy it; you say it is my part to
get it cheap. Yes, but you see, I buy iron not (in real truth) with cash, but
with the fruit of my toil. That fruit is in the form of books, and it will pay
me to give ten pounds a ton for iron made at home by men who can and do buy my
books, than take it for five pounds a ton from a strange land where my books
are not bought. The real cost to me of the iron is less, and my case is that
of men
in all lines of work in this land." |
|
| This sort of chaff will catch some birds, but it is mere chaff. The point
is this: could the same time and skill in his land bring forth more wealth
in some
other form than iron? If not — if the land was one in which iron could
be made
with great ease and much gain— then there would be no need of a tax to "shield" the
trade; but if so, if work in the iron line could, as a fact, only be done as
it were by force, as plants
are grown in a hot house, then the time and skill would bring line, and the wealth
made sent off in trade for iron. In that case all would have more gain and could
buy more books. In the case as he puts it, the fact is that he has been made
to pay ten pounds for skill that, if put to some other form of work, would have
cost but five. His loss is as sure, and of the same kind, as if he had been made
to hire a small boy to do a man's work, and pay a
man's wage. |
|
You will hear it said that high price makes no odds, since we pay it
to our own folk in our own land. This is nice, but it is said as a rule
by those who sell. Yet it ought to work both ways if it is true. If it
makes no odds that you have to buy at a steep price, it ought to be just
as fair for the law to make the shop men sell at a price less than cost.
But, you tell them that, and hear what they will say.
|
|
CHAPTER XI: GOODS
OUT AND IN |
|
| "It is a gain to send goods out, a loss to bring then in." So we are
told (this is known as the "Balance of Trade" Doctrine). It would be all
right, if what we spoke of were pests we were glad to be rid of — but
to say the least it has a queer sound when we speak of "goods." Yet grave
men say this as if they meant it, and no doubt they do mean it; yet we
should think a dog had less than dog sense if he should snarl when you
gave him a bone and wag his tail when you took
the bone from him. |
|
| If each man in the land got in more wealth than he gave out he would
be apt to get rich; but it seems that if they all did this at once they
would grow poor! Strange, to be sure! |
|
| Now, if the plan was to put a high tax on all the goods that were sent
out and no tax at all on what came in, it would seem more apt to make us
all rich, for the land that has the best store of good things must be the
best place to live in. But if such a plan were brought up, the High Tax
men would raise a great howl. What would they say? Why, that if you did
not send goods out you could not get things of more worth to bring in,
and so your land would lose more and more. Quite true, but do they not
kill their own case when they say that? Their case is, bear in mind, that
we grow in wealth only as we send out more than we get in! And of course
there is no truth in this. Trade, when it is fair and just, has gain on
both sides of it, for each gets what is of more worth to him than what
he gives. Each pound of goods sent out means more than a pound (in worth)
brought back. If it were true that a land did well when it sent out more
than it brought in, then it would reach the top notch of gain if it sent
out all its goods and got none back at all! From this point of view there
ought to be cause for great joy in the fact that rich girls in the States
wed poor lords from John Bull's land, as they take with them huge bags
of gold for which nought comes back; and it must be a fine thing, too,
that more and more of the men who work farms in the West send rent each
year o'er the sea to the swells who own the land and are so kind as to
let them work it. If, now, the States could only have a war, and get the
worst of it, and be made to pay a big sum to the land that beat them, what
a fine spec it would be! It is hard to think that men are to be found who
talk such stuff as this and mean it, yet it is true. You may read it in
books by men who are said to be quite sane, too. It is a queer twist in
thought, that you do well
when you sell, but not when you buy. |
natural resources, absentee
ownership, rent, all
benefits..., in one's sleep |
CHAPTER XII: A
TWIST IN THOUGHT, THAT'S ALL |
|
| How came this queer form of thought to take root? Why do sane men hold
the view that the more goods a land sends out, and the less it brings in,
the more rich it grows? That it pays more to sell than to buy? When wild
tribes trade they give goods for goods; and this is the way in which some
rude forms of trade still go on in our towns, as when men come round for
grease and give soap for it. No such man ever thinks that he does well
when he gives more soap than the grease he gets is worth. But trade is
not now done as a rule in this rough form. Cash, or notes, or bills or
some such "sign" for goods are used, and not the things that are dealt
in. But to this fact we may trace all the fog that is in the minds of
men on the point we have in hand. |
|
| Of course, as trade went on, some sign for wealth had to be got. One
man might want to give a drove of hogs for a house, but he would not care
to drive the pigs for miles, nor could his friend move the house. But with
some such thing as gold as a sign of value the trade could be made quite
well. To be sure, in the first place they would need to know just how much
wealth the unit of gold was worth, so that they could count the worth of
things they were to trade; the same as, ere you could tell the length in
yards of a rope, you must have a yard stick to fix what you mean by a yard,
and the same of weight and bulk, we must first come to one mind on what
is meant by a pint; a quart, and so forth. As the world goes on, trade
tends more and more to be done through the use of cash, bills, notes of
hand, and such things; and as these things are dealt with day by day we
get to think of them more than of the goods they stand for; and at length
we are apt to get the thought that cash is worth more than the things you
give for it, etc. When a man buys a coat and gives the cash for it, the
shop
man says, "Thank you." Why does not the man say "thank you" for the coat? Whence
springs the idea that the cash is worth more than the coat? No doubt from the
fact that cash is a thing you can turn into any form of goods at once, for all
are swift to sell for cash, but to trade a coat for some thing you may want,
say a pair of boots, you must find some one who has the sort of boots you want
and who at the same time is in need of the size and sort of coat you have to
give. The cash seems worth more than the coat, since you can change it for what
you may want with so much more case. If the man who went to the shop for the
coat gave, not cash, but eggs and cheese in trade for it, the terms buy and sell
would not rise in his mind, he would think of it as a trade, and it may be the
shop man would not
say "Thank you." In this case they both sell and both buy, and both think of
it as a fair deal; but if cash is used, they think one buys and the other sells,
and he who sells gets the best of it. It is not so; the cash stands for just
the worth of the coat, and the man sells the cash as much, as if it were eggs
and cheese. But such is the twist in our thought on this point that we cling
to the view that he who sells gets the best of it. So, when we turn our thoughts
to the Trade of a land, we still have this idea, and thus think that a land which
sells most and buys least is the land that gains. But in truth and fact, it is
the man who buys more goods (that is, gets in more goods) than he sells (that
is, gives out) who gets rich. If he sells for, say, 10, and with that 10 buys
goods worth to him 20, does he not gain? And so with a land. If it gets for its
exports that which is worth twice as much in the form of imports, why should
we think it
a loss? You see where the twist of thought is? When we use the word "sell" we
think of cash, and it means not give out goods but get in gold, and when we use
the word "buy" it means not get in goods but give out cash. But it comes straight
when you keep in mind that it is
goods we want and not the "sign" for them. |
trade, |
| |
|
full index | previous | next
|
|