The specific duty on woolen manufactures, including carpets, while designed to "compensate" the manufacturer for the duty on wool, is also a part of his "protective" duty, in addition to the ad valorem duty, which is the primary protection.

This means, of course, that carpets, etc., get the benefit of both the compensatory duty and the protective duty, so far as these two elements are embraced in the specific square-yard duty.

The Dingley bill, while giving to wool nominally 60 per cent of the wool duties of the act of 1890, gives to carpets, etc., the whole specific square-yard duty of that act-not merely 60 per cent of it.

(3) In addition to this, the Dingley bill gives to carpets, druggets, etc., the ad valorem duty imposed on such articles by the act of August 27, 1894. Some of these ad valorem duties are higher than those of the McKinley Act of 1890, some the same, and others a little less, as shown in the following table:

Thus all carpets are given all the specific duties of the act of 1890, some of these are given more than the ad valorem duty of the act of 1890, others are given the same as in the act of 1890, and a few only so little less than in the act of 1890 as to be practically immaterial in difference. In view of the very liberal specific duty the Dingley bill is thus about as beneficial to carpets as the McKinley Act.

(4) It was in view of this that the Dingley bill concludes with a proviso:

That where the present rate of duty on any article is higher than was fixed by said last-named act (the McKinley Act of 1890) the rate of duty thereon shall not be further increased by this section, but shall remain as provided by existing law.

(6) And the specific duties on carpets are levied as if they were made of all pure wool, when to a large extent shoddy, cotton, cow and calf hair, in part, enter into the composition of too many of them. Carpets are in a measure luxuries entitled to less favor than clothing goods; but carpets have always had an unfair advantage over woolgrowers and over most other kinds of manufactures.

IX.-MCKINLEY FAVORED BETTER PROTECTION THAN THE ACT OF 1890.

When Mr. McKinley reported the tariff bill of 1890 it proposed specific duties of 2.5 cents and 8 cents, according to value on third-class wools. The bill reported by Senator Allison in 1888 as a substitute for the Mills free-wool bill proposed specific duties of 2.5 cents and 6 cents, according to value. But certain carpet manufacturers succeeded in getting an ad valorem duty of only 32 per cent in the act of 1890 on such wools as are now chiefly imported as third class.

X.-HOW THE IMPORTS OF THIRD-CLASS WOOLS INJURE WOOLGROWERS.

These wools produce more ruin to our woolgrowers than all others. They supplant our American merino and the long wools of the mutton breeds. Their imports in the fiscal year 1895 were 144,488,265 pounds, while the imports of all other wools for consumption were only 121,237,612. These wools are of such light shrinkage that they would equal nearly 200,000,000 pounds of our unwashed merino. Of these imports in 1895 there were of China wools 26,089,418 pounds, at an import price of only 5.15 cents per pound. This is a new and the cheapest source of supply, almost unknown prior to the act of 1890. The import prices of all third class from August 28, 1894, to June 30, 1895, was only 9.13 cents. The duty of 32 per cent on China wools would be less than 1.65 cents per pound and, on an average of all, would be only 2.92 cents. And this is on wools shrinking in scouring not over 40 per cent, so that the protective benefit of the new bill on our unwashed merino is less than 2 cents per pound.

The China wools by reason of light shrinkage would supplant the use of 40,000,000 pounds unwashed merino. The memorial, page 38, produces evidence that these wools are used in the manufacture of clothing goods, and that "fashion" has made it popular to use the very coarse wool goods.

American woolgrowers can not compete with these wools, imported at these low prices, and with these low duties.

This subject is more fully discussed in Senate Document No. 17, Fiftyfourth Congress, first session, pages 38, 73, to which reference is especially made.

XI.-AS TO "CARPET WOOLS."

The report of the Committee on Ways and Means says:

1. The duty on carpet wools is left at 32 per cent ad valorem, as we raise very few carpet wools.

Here are two errors:

1. The law does not classify any wools as carpet wools because all wools are now used to make clothing goods. (Senate Doc. No. 17, Fifty-fourth Congress, first session, pp. 38, 74.)

2. We do raise carpet wools and can raise all needed, as shown in our memorial, page 76. (Senate Doc. No. 17.)

3. The report says the bill is framed "mainly on revenue ground." Why then did not the committee adopt as a temporary expedient the less than low revenue rates of the bill in our memorial, page 218? (Senate Doc. 17.)

4. The committee bill does give protective rates to iron and other industries, but not to wool. The report says the bill gives manufactures "a compensatory duty equivalent to the duty on wool." The fact is, it is largely more than an equivalent. Woolgrowers are discrimi nated against.

5. Since the McKinley act was passed the prices of wools in all foreign countries have declined materially. See memorial, page 60, etc. This, of course, was not foreseen when the McKinley bill was passed. A new law should meet these new conditions. See also this document, page 31.

6. By reason of the combined operation of these causes-(1) the skirting clause, (2) the light shrinkage of Australian merino, (3) the new and enlarged use of third-class wools for clothing goods, formerly used only

for carpets, and (4) the decline in the world's wool prices, the McKinley act ceased to accomplish the purpose intended by it. Under it prices of wools constantly declined, and the inevitable result would soon have been a failure to secure prosperity to American sheep husbandry. Even in Texas, where the cost of growing wool is as low, if not less, than any other State, sheep declined in numbers from 4,218,812 in 1890 to 2,859,269 in 1894.

These new and unexpected results and conditions call for increased protection, not for reduction. The duties of the act of 1890 are now even less than low revenue duties. No other industry has suffered from such a combination of causes, of ruin, and hence the new bill should have recognized this fact and made provision accordingly. The new tariff bill gives the ruinous ad valorem duties to woolgrowers, the specific duties to all other industries. Why continue this unjust discrimination?

Under the new bill most other industries can live by reducing wages, but under it the wool industry is doomed to ruin only a little less speedy than by free wool.23

IN FAVOR OF PROTECTION.

I do not object at all to any of the protection the Dingley bill proposes to give to manufacturers. I have never objected to the protec

tion given them by the McKinley act.

If it had been continued in force, with adequate protection to wool, in five years American woolgrowers could have supplied all the wool needed for consumption in the United States.

My purpose in what I have said is not to give any aid to efforts to defeat the passage by the Senate of the Dingley bill in a form which President Cleveland would probably permit to become a law if in a shape to do equal justice to woolgrowers and manufacturers, and not to interfere with an extra session of Congress, but only to put it in a shape in which it will commend it to his sense of justice and fairness, and to the sense of justice and fairness of the whole American people. Respectfully, etc.,

WILLIAM LAWRENCE,

President of the National Woolgrowers' Association.

XII.—ADDENDA TO THE FOREGOING LETTER.

THE WOOL MANUFACTURERS BETTER PROTECTED THAN WOOLGROWERS.

1. Since the foregoing letter was written the Wool Circular of Justice, Bateman & Co. of December 1, 1896, contains the following:

It has been erroneously stated that the Dingley bill would give an undue advantage to the woolen manufacturer. Under this bill the manufacturer gets no protection whatever, outside of the compensatory duties that he receives through the duties which the American woolgrower gets upon raw wool.

To that it may be said:

1. This statement of the Circular is an error. This has been demonstrated in the letter to Senator Carter.

23 AS TO A VETO BY PRESIDENT CLEVELAND.

This subject is sufficiently discussed in footnote 15 in Chapter I of this Document, to which reference is especially made.

2. The tariff act of October 1, 1890, gave to wool manufacturers, and especially carpet manufacturers, much more protection benefit than to the woolgrowers.

3. The Philadelphia Bulletin of the American Iron and Steel Association, of November 20, 1895, an able advocate of a protective tariff, says the Dingley bill "affords a fair degree of protection to the woolen [manufacturing] industry."

Finally, in what has been said in any part of this document no personal disrespect to any individual or locality is intended. The good faith and honesty of purpose of all are undoubted, but woolgrowers have, with equal good faith and honesty, presented their views and purposes.

XIII. JUSTICE, BATEMAN & Co., ON THE DINGLEY BILL.

[From the Commercial Bulletin, Boston, November 28, 1896.]

THEIR NINE REASONS IN FAVOR OF THE IMMEDIATE PASSAGE OF THE 99 "DINGLEY TARIFF BILL WITHOUT AMENDMENT.

The Boston Commercial Bulletin, of November 28, 1896, contains NINE REASONS presented by Justice, Bateman & Co., of Philadelphia, in favor of the immediate passage of the Dingley tariff bill without amendment.

They are given below with some notes by way of comment thereon.

Nine reasons for passing the Dingley tariff bill at the coming short session of the Fiftyfourth Congress.

First. The failure to pass the Dingley bill substantially as it left the House of Representatives, during the balance of this session, will result in an enormous flood of imports before a new law can be passed. A new law must necessarily furnish inadequate revenues during the subsequent McKinley Administration through decreased imports during that time, which will have been anticipated before the law can be put in force. The injury to industries by such a glut of over importations under a continuance of the present Wilson law will make the whole of McKinley's Administration one of insufficient revenues as well as one of disappointment to woolgrowers and woolen manufacturers.

Second. A large portion of the woolgrowing and woolen manufacturing industries of the United States can not survive another year of the Wilson tariff law, which has reduced the number of sheep to less than the quantity on hand twenty-eight years ago.

Third. The early passage by the Senate of the Dingley bill, by giving the Government forty million dollars additional revenue, the receipts of which will begin immediately after its passage, will prevent the necessity for further increase in the national debt by a further sale of bonds, which must reflect discredit upon Cleveland's Administration and further expose its incompetency, even though the bonds have to be sold by Mr. McKinley's Secretary of Treasury.

Fourth. The immediate passage of the Dingley bill will prevent the glut of imports which otherwise will be rushed in in order to anticipate the high duties of any subsequent tariff law. and the Government will lose the benefit of the revenue upon the enormous quantities of wool (a fair article of taxation for revenue) which, pending the reimposition of duties, would be likely to be imported in sufficient quantities to last for years to come. Immense quantities are now afloat in order to discount the Dingley bill. This gives some idea of the volume that can be brought in before an entire new law can be made by an extra session of Congress.

Fifth. The increase of over five hundred millions in the national debt (including interest on the same, which must be paid before the principal through taxation) will reach over six hundred millions increase before a new tariff law, providing adequate revenue, can be formulated by the McKinley Administration. Therefore, the Dingley bill as a temporary measure should be passed at once, for the deficit of revenue for the present year at the present rate must exceed $100,000,000 before any relief can

come through legislation by an extra session of Congress, and the per capita tax in consequence thereof must in future exceed even that of the McKinley period.24

3. Disturbing business-Increase duties 5 per cent annually.

Sixth. If the Dingley bill should be passed as a temporary measure and should it be found inadequate as a protection measure, it can be increased 5 or 10 per cent annually, or otherwise amended without disturbing business, as would be the case if an entirely new law was made.5

24 (1) The Memorial of the Farmers' National Congress, agreed on at its session, Indianapolis, November 10-13, 1896, to the Congress of the United States asks for four amendments to the Dingley bill, as follows:

I. That the "skirting clause" of the act of 1890 shall not be applicable to the bill. II. That the pledge therein that it shall continue in operation "until August 1, 1898," shall be struck out.

III. That the duties on woolen rags, shoddy, mungo, flocks, noils, wastes, and other adulterants shall be made prohibitory.

IV. That wool and woolen manufactures imported under its provisions shall not remain in bonded warehouses more than ten days.

Not one of the socalled reasons afford any objection to any one of these proposed amendments.

(2) Theodore Justice, of the firm of Justice, Bateman & Co., in a letter, November 25, 1896, to William Lawrence, said, referring to the foregoing amendment: "I have no objections to your SECOND, THIRD, and fourth amendments, except that it opens the bill to delay."

To this it may be said:

1. A prompt agreement to the amendments will probaby AVOID DELAY.

2. Why shall not proper amendments be made?

3. Those who resist just amendments may be responsible for the defeat of the bill. 4. These amendments are discussed in footnotes 13, 14, and 15 of Chapter II of this document. The first amendment is discussed in footnotes 11 and 16, to which especial reference is made.

25 This is discussed in footnotes 11 and 15 of Chapter I of this Document.

It may be further said:

(1) Ille est niger. Timeo Danaos et dona ferentes.

(2) "Disturbing business." The Associated Press dispatches of December 3 report the Hon. James A. Tawney, of Minnesota, one of the Republican members of the Ways and Means Committee of the House, as saying:

"If some of the Democrats in the Senate who opposed the bill at the last session are now ready to yield to the Treasury's demand for more revenues they will do so because they realize that in the end it will prove an embarrassment to the Republicans by frustrating with delay the full consummation of the Republican policy. Everyone understands that the result of the election means a complete revision of the tariff on protective lines. If the Dingley bill should become a law at this session an extra session would not be justifiable and the complete revision would be postponed until the long session of the Fifty-fifth Congress. This would

66 KEEP BUSINESS UNSETTLED

for eighteen months, perhaps longer, and would send us into the Congressional elections after a long and bitter fight with a tenative measure. It would give our political adversaries an immense advantage. An extra session, on the other hand, would be advantageous both from a business and political standpoint. The business interests will not be content until the complete revision is accomplished. The sooner they know exactly what schedules are to be in force the sooner will the confidence that comes from certainty as to future conditions be restored. Politically considered, no one can gainsay the advantage which must accrue to the Republican party from having a tariff law in force for fifteen months before the Congressional elections. "The law by that time would have demonstrated its merits, indicated its ability to produce revenue and stimulate business, and place it out of the power of its opponents to use speculative argument against it.

"The extra session would probably be very short. Every Republican member of the Ways and Means Committee of the House has been reelected to the Fifty-fifth Congress, and this winter we can frame the new bill and have it ready when the new Congress is called."

This is a sufficient answer as to "disturbing business."