to the demand. But fresh capital and renewed energy, aided by the continuance of the duty enacted in 1870, soon brought production up to the demand, and since 1881 comparatively few steel rails have been imported in proportion to the whole number required to equip lines of new railroad and to replace the iron rails in the tracks of the old roads. From 1872 to 1887, both years inclusive, this country laid 13,699,699 gross tons of Bessemer steel rails, of which 1,149,357 tons were imported and 12,550,342 tons were made in our own works. Statistics of the imports of steel rails before 1872 are, unfortunately, not obtainable.

In the debate in the House of Representatives in 1870 on the bill which, among other provisions, fixed the duty on steel rails at $28 per ton, Hon. Samuel S. Marshall, of Illinois, manifested great distress for fear that the proposed duty would be so high that it would to a large extent cut off the importation of foreign steel rails, thus depriving our railroad companies of the opportunity to buy the steel rails that they would need, "except the few made in this country, and which are sold at an enormous cost." At the time this speech was delivered, in June, 1870, steel rails were selling in this country at $110 per ton, and the average price at which they were sold during the whole of the year 1870 was $106.75. The duty of $28 did not produce any of the evil effects predicted by Mr. Marshall. On the contrary it wonderfully increased the production of steel rails at home, and it so reduced their price that all the steel rails made in the United States since Mr. Marshall's speech was delivered have cost our railroad companies an average of less than $46 per ton. Every instinct of patriotism aside, home competition was needed to keep down the price of steel rails of foreign manufacture. The magnitude of the service which has been rendered to the railroads of the country by our Bessemer steel industry will be more fully understood by considering a few leading facts. The resisting and wearing qualities of a steel rail being much superior to those of an iron rail, it is therefore capable of supporting a much heavier weight of cars, locomotives, freight, and passengers, and it permits trains to be moved at a much greater rate of speed; hence the carrying capacity of our railroads has been increased many times, and the cost of operating them per ton of freight carried or per passenger has been greatly de creased. The life of a steel rail, notwithstanding the greater service it has been called on to perform, being many times greater than that of an iron rail, the cost to our railroad companies for renewals of track is many times less than if iron rails were still used and sold at the price now brought by steel rails. But steel rails have been steadily sold since 1882 at a lower price than iron rails could be produced, and consequently iron rails have not since been made in this country except for mine railroads or other special purposes. In July, 1870, when the duty of $28 per ton on steel rails was enacted, the price of iron rails was $72.50 per ton, and the lowest price at which they have since been sold was about $33 in the gloomy years 1877 and 1878; whereas, as has been stated, the average price of all the steel rails which have been made in this country has been less than $46, while at least a million tons have been sold at lower prices than were ever touched by iron rails.

Few persons stop to think how much our railroads owe to cheap steel rails. When our dependence was wholly or chiefly on iron rails we built railroads very slowly. Before this country commenced to make steel rails, in 1867, our railroad mileage aggregated less than 40,000 miles; now it is over 150,000 miles.

HOW TRANSPORTATION HAS BEEN FACILITATED AND CHEAPENED

As one important result of the cheapened cost of constructing and operating American railroads, in consequence of the wonderful development of our Bessemer steel industry and the low prices of steel rails the cost of transportation has been greatly reduced. The following table shows that since 1868 the charge for transporting a bushel of wheat, a representative product, from Chicago to New York has steadily declined. This table was compiled by the Bureau of Statistics of the Treasury Department:

Steel rails of home manufacture made cheap railroad transportation possible, and the competition of the railroads with the lakes and canals also greatly reduced the cost of transportation by water.

In his Manual of the Railroads of the United States for 1881 Mr. H. V. Poor says that "the charge in 1860 for moving a ton of freight one mile on the New York Central Railroad was 2.065 cents; the cost was 1.343 cents; net, 7.22 mills. The charge in 1870 was 1.863 cents; cost, 1.153; net, 7.10 mills. In 1880 the charge was 8.79 mills; cost, 5.42 mills; net, 3.37 mills per ton per mile. The charge in 1880 was about three mills less than the cost in 1870. The percentage of profit, not. withstanding, was greater in 1880 than in 1860 or in 1870." Mr. Poor further states that "in 1870, at the rates then prevailing, the laboring mau in the city of New York paid $1.60 for the conveyance to him of a barrel of flour from Chicago. In 1880 he paid only 86 cents for the same service." Mr. Edward Atkins, of Boston, has shown that the freight charges for the movement from Chicago to Boston, a distance of 1,000 miles, of one year's subsistence of grain and meat for an adult workingman now amount to but $1.25, which sum is only one day's wages of a common laborer, or half the daily wages of a good carpenter or

mason.

These are some of the cheapening effects upon transportation produced by building up a great Bessemer steel industry in our own country instead of in some other country.

The benefits which this country have derived from cheap steel rails are so numerous and enter so largely into the daily life of all our people that they have ceased to excite special comment, like the natural blessings of light, air, and water. But what mighty changes have been wrought by these steel rails of home manufacture! The immense agricultural crops of the country in the last twenty years never could have been transported to either home or foreign markets if iron rails had been continued in use; the attempt to transport them upon iron rails would have so worn out the rails that the tracks would constantly have

been torn up for repairs, and this would have resulted in a continual in-
terruption to all traffic. If dependence for steel rails had been solely
on foreigy sources to supply, the cost of transportation, resulting from the
high prices of foreign rails, would have been so great that it would not have
been profitable to grow these immense crops; indeed, the prices of for-
eign rails would have been so high that few railroads would have been
built in the Western States and Territories, and the marvelous devel-
opment of that section could not have taken place. Finally, it may be
said that, but for our cheap steel rails, flour and meat, lumber and coal,
and numerous other heavy products could not have been cheaply dis-
tributed to consumers, the necessaries of life would have been largely
enhanced in price through the high cost of transportation, and the
whole country would have had a much less rapid growth than it has
experienced.

PRODUCTION AND PRICES OF STEEL RAILS FROM 1867 TO 1887, AND
THE DUTY THEREON.

We now submit a detailed statement of the production of Bessemer
steel ingots and Bessemer steel rails in this country since 1867, the
average annual prices at which the rails produced have been sold, and
the highest prices of steel rails in England every year since 1867; also
the duty on foreign rails, the average price of gold in currency, and the
annual increase in railroad mileage in the United States. Included
in the production of rails in this country in the last few years are a
few thousand tons which were annually rolled from imported blooms. ·
The quotations of English rails are taken from Fossick's history of the
British iron trade, a recognized authority.

From August 1, 1872, to March 3, 1875, the duty on steel rails was

subject to the general reduction of 10 per cent., which was authorized

by the act of June 6, 1872, and was accordingly $25.20. After March

3, 1875, the duty of $28 was restored by the act of that date, and it

continued to be in force until July 1, 1883, when the present duty of $17 per ton, provided in the act of March 3, 1883, took effect. A serious effort was made in 1880 to reduce the duty to $10 per ton, but it failed to receive the approval of the Committee on Ways and Means, largely through the protest of the officers of many of our leading railroads.

It will be seen that under the various protective duties which have prevailed since 1870 the production of Bessemer steel ingots and rails in this country has increased by leaps and bounds, and that there has been a very great decline in domestic prices. In 1884 and 1885 there was, however, a notable check to our progress in production, caused by the shrinkage in railroad construction in those years. In 1879 and 1880 there was also an interruption to the steady decline in domestic prices which bad previously ruled. This was caused by the railroad fever which began in those years, and which suddenly created a demand for steel rails that had not previously existed. Subsequently the prices of domestic rails again declined, until in 1885, through merciless home competition, their manufacture ceased entirely to be profitable. From this depression there followed in 1886 and 1887 a great increase in demand and produc tion and an improvement in prices, but in the latter part of the year last mentioned the demand again suddenly declined and prices again fell. The year 1888 will witness a greatly reduced production. Prices in March are $31.50 per ton.

A reference to the table above presented will show frequent and violent fluctuations in the prices of steel rails in England. When the "iron famine" in this country occurred in 1871 and 1872 the home price of English steel rails was advanced to our railroad companies about $32 per ton, or from 220 shillings to 350 shillings. This high price was again exacted in the summer of 1873. In these years the Bessemer steel industry of this country was in its infancy, while that of Great Britain was well established. When "the boom" of 1879 and 1880 occurred in this country, and we were again unable to meet an extraordinary demand for steel rails, England again advanced the price of her rails to American railroad companies about $27 per ton, or from 90 shillings to 200 shillings. She was induced to make a part of this advance by the prospect of a reduction of our duty on steel rails. In January, 1880, Mr. Covert, a member of Congress from New York, introduced a bill in the House of Representatives to lower the duty from $28 to $10 per ton. At the time this bill was introduced the price of steel rails at the works in England was £8, or $40 per ton. For a time it seemed probable that the bill would become a law. English manufacturers, with the prospect of decreased American competition in the supply of American railroads with steel rails, at once advanced the price of their rails to £10 or $50, at their works-an increase of $10 per ton. The duty was not reduced, and in a few weeks the price of English steel rails receded to £8 per ton, and during the year fell to £6. These quotations show that whenever, from any cause, there has been a scarcity of American steel rails Great Britain has taken advantage of our necessities to put up her prices. CONSEQUENCES WHICH WOULD FOLLOW A FURTHER REDUCTION OF THE DUTY ON STEEL RAILS.

As has been stated, the duty on steel rails was reduced in 1883 from $28 to $17 per ton. It may be frankly conceded that when this reduction was made the whole of the duty of $28 was no longer needed to protect our Bessemer steel manufacturers against ruinous foreign com

petition. They had introduced so many improvements in their business that the cost of producing steel rails from the raw materials had been greatly diminished. In 1882 the manufacturers voluntarily expressed to the Tariff Commission their acquiescence in a reduction of the duty to $22.40 per ton, which duty they claimed was necessary because of the continued high cost of raw materials, transportation, and wages. The Commission recommended a duty of $17.92, and Congress fixed the rate at $17. This was a reduction of $11 per ton upon the duty established in 1870.

It is now proposed to still further reduce the duty on steel rails upon the plea that the revenues of the Government are excessive and should be reduced, and that one way to reduce them is to reduce duties. This plea is a delusion and a snare. To reduce duties on most manufactured commodities is to invite increased importations, and increased importation, besides being a wrong to our own people, certainly can not tend to a reduction of revenues unless the articles imported are placed on the free list.

Why should we reduce the duty on steel rails or on any other product for the benefit of foreign manufacturers, or for the benefit of unnaturalized importers who reside in a few of our large cities? If we reduce duties below a point which secures a fair degree of protection for domestic industries importations will surely increase. This has been our experience under the tariff act of 1883, which reduced duties, and under preceding tariffs which were constructed with more regard to revenue than protection. And let no person suppose that it is impossible to seriously cripple or even to destroy an American industry by the withdrawal of protection. That which has been may be. Our infant tinplate industry was totally destroyed in 1864 by a fraudulent and undoubtedly corrupt evasion of the protective duty which Congress intended to impose, and it remains destroyed to this day. Our iron-rail industry was destroyed in 1850 by a low ad valorem duty. The partic ulars of this event in our industrial history convey a warning to those who would now recklessly imperil our steel-rail industry.

In 1844 this country made its first iron rails, except a few flat rails which had previously been made and which were only bar-iron. Fif teen rolling-mills for the manufacture of iron rails of modern patterns were in operation in several States between 1844 and 1850. But, as a result of the ad valorem tariff of 1846 and the extremely low prices of iron rails which prevailed in Great Britain, the manufacture of these rails in this country practically came to an end in 1850. Foreign competition could have been held in check if a protective duty had been in force. Mr. Abram S. Hewitt, in a letter dated December 26, 1849, described the condition of our iron rail industry at that time in the following language:

Of fifteen rail-mills only two are in operation, doing partial work, and that only because their inland position secured them against foreign competition for the limited orders of neighboring railroads, and when these are executed not a single rail-mill will be at work in the land.

The following letter shows how the consumers of iron rails in our country were injured after 1849 by the destruction of the domestic rail industry, and it shows, too, who were benefited. This letter confirms with curious and pathetic exactness the correctness of Mr. Hewitt's prediction in that year that every rail-mill in the country would soon be closed.

BROOKLYN, N. Y., February 15, 1882. SIR: About the year 1850 the writer was a clerk in a house in Boston, which represented one of the largest of the English iron-rolling mills. It was a period of low