Democratick Editorials: Essays in Jacksonian Political Economy
Plaindealer, December 3, 1836. Title added.
Among the reports adopted by the Board of Aldermen at a recent sitting was one "in favour of appropriating so much space about Pike Slip as may be necessary for the accommodation of the East river steamboats, and leasing berths for the boats there for not longer than two years, such place to be called East River Steamboat Place." Another of the reports adopted was in favour of the appointment of a new set of publick officers, under the name of dockmasters, with a salary of five hundred dollars. The principle upon which these measures are founded is one entirely contrary to the genius of democratick government, and to a true theory of political economy. There is no greater reason why the docks and slips should be the property of the city government, and should be disposed of at the discretion of the Common Council, than why the store houses and dwelling houses should, in the same way, be under the municipal control. The political objection to this is that it strengthens the government at the expense of popular rights, creates a necessity for numerous subordinate officers, and makes it more difficult for the honest unbiassed voice of the people to have its due influence over publick affairs. The economick objection is, that no code of municipal laws can ever answer the purposes of trade as well as its own laws. When the docks are owned by the people in their corporate capacity, and hired out by their municipal agents, it results, as an inevitable consequence, that there will be favouritism and partiality in the arrangement; one place will be charged at too high a rate of wharfage, and another at too low; and business will be forced from its natural direction to suit the views of speculators, or to gratify the demands of sectional rapacity. It would, in our opinion, be a wise measure of publick policy, for the corporation to dispossess itself of all property in the docks and slips, selling them to the highest bidder, with perhaps a preemption right to the owners of the contiguous lots. By such a measure a vast fund might be realized, which would go far to pay off the city debt, and would greatly diminish the burden of taxation. According to our theory of government, the more simple the principles on which it is conducted the better. When we hear of the Common Council having made a fortunate speculation in the purchase of some island or unneeded tract of land, which has risen in money price on their hands, the thought strikes us that, what the government gains, certain individual citizens must have lost; that the aggregate wealth of the community is not increased; and that it is no part of the proper duty of government to enter into competition with citizens in the business of purchase and sale. Besides, whatever increases the wealth of a government, whatever sources of revenue it obtains independent of taxation, increases its power, and diminishes the power of the people in the same ratio. This is not a result which a democrat should desire. The aristocratick theory, the main feature of which is distrust of popular intelligence and virtue, approves a strong government; but give us a strong people as the only certain basis of the rights of property and of social order and prosperity.
Plaindealer, December 10, 1836.
Some days ago, we observed in one of the newspapers, a paragraph stating that a meeting of mechanics and labourers was about to be held in this city for the purpose of adopting measures of concerted or combined action against the practice, which we have reason to believe exists to a very great extent, of paying them in the uncurrent notes of distant or suspected banks. No such meeting, however, as far as we can learn, has yet been held. We hope it soon will be; for the object is a good one, and there is no other way of resisting the rapacious and extortionate custom of employers paying their journeymen and laborers in depreciated paper, half so effectual as combination.
There are some journalists who affect to entertain great horror of combinations, considering them as utterly adverse to the principles of free trade; and it is frequently recommended to make them penal by law. Our notions of free trade were acquired in a different school, and dispose us to leave men entirely at liberty to effect a proper object either by concerted or individual action. The character of combinations, in our view, depends entirely upon the intrinsic character of the end which is aimed at. In the subject under consideration, the end proposed is good beyond all possibility of question. There is high warrant for saying that the labourer is worthy of his hire; but the employer, who takes advantage of his necessities and defencelessness to pay him in a depreciated substitute for money, does not give him his hire; he does not perform his engagement with him; he filches from the poor man a part of his hard-earned wages, and is guilty of a miserable fraud. Who shall say that this sneaking species of extortion ought not to be prevented? Who will say that separate individual action is adequate to that end? There is no one who will make so rash an assertion.
The only effectual mode of doing away the evil is by attacking it with the great instrument of the rights of the poor— associated effort. There is but one bulwark behind which mechanics and labourers may safely rally to oppose a common enemy, who, if they ventured singly into the field against him, would cut them to pieces: that bulwark is the Principle of Combination. We would advise them to take refuge behind it only in extreme cases, because in their collisions with their employers, as in those between nations, the manifold evils of a siege are experienced, more or less, by both parties, and are therefore to be incurred only in extreme emergencies. But the evil of being habitually paid in a depreciated substitute for money; of being daily cheated out of a portion of the just fruits of honest toil; of having a slice continually clipped from the hard-earned crust; is one of great moment, and is worthy of such an effort as we propose.
THE COAL QUESTION
Plaindealer, December 10, 1836. Title added by Sedgwick. Text abridged.
There seems to be no doubt entertained, among those who have investigated the subject, that there is a combination among the dealers in coal, in this city, not to sell under certain stipulated prices. We do not know whether this is so or not; but let us take it for granted that it is, and the question then arises, What are we to do to remedy the evil? The Albany Argus would suggest that "it might be well to inquire whether combinations to raise the price of coal, pork, flour, and other necessaries of life, are not offences against society," which require to be made punishable by law. The Journal of Commerce (a free-trade paper!) would respond affirmatively to the question, and say, "if dealers in the above articles have combined to raise prices, let the law walk into them!"
For our own part, we would neither make a new law to punish the combiners, nor... inflict upon them the penalty of any existing statute, or of any breach of the common law of England....
The Journal of Commerce and the Albany Argus may both rest assured that the laws of trade are a much better defence against improper combinations, than any laws which the legislature at Albany can make, judging by the specimens to be found in the statute books. When a set of dealers combine to raise the price of a commodity above its natural value, they will be sure to provoke competition that will very soon let them down from their fancied elevation.... Truth is truth, and though the price of fuel is enormously high, we ought not to impute all the blame to those of our citizens who deal in the commodity, when our own figures prove that they do not make very extravagant profits after all.
But if the blame does not lie with the coal dealers, where does it lie? We think there is no great difficulty in correctly answering this question. According to our view it lies, then, in the first place, with the legislatures of two or three states, which have given the privileges of a monopoly to certain coal companies, enabling them to fix prices by combination at the fountain head. It lies, in the second place, with those same legislatures, in giving the privileges of a monopoly to certain railroad and canal companies, enabling them to fix the rates of toll and freightage. It lies, in the third place, with Congress, which has placed so heavy a duty on foreign coal as almost to shut it out from competition with the domestic. And it lies, in the fourth place, with our municipal authorities, who increase the burden by appointing measurers of foreign coal, weighers of domestic coal, and inspectors of wood, all of whom are allowed, by law, enormous fees for a duty which they do not half perform, and which, if they performed it ever so thoroughly, would be altogether superfluous.
There is still one other cause which ought not to be omitted from the calculation; and that is, the diminished quantity of coal mined, in consequence of speculation having withdrawn labour from that employment, during the past summer, to work on railroads, to dig canals, to level hills, and fill up valleys, and, perform the various other services which were necessary to carry out the schemes projected by the gambling spirit of the times. Hence the supply is not more than adequate, at the most, to the demand; and hence those who have a monopoly of the article at fountain head ask the present enormous prices, secure that the citizens must either give them or freeze.
There is one branch of this subject in which we most cordially concur with the Journal of Commerce. That paper suggests the propriety of the institution of benevolent associations, for the purpose of procuring a large supply of coal when it is cheapest, and disposing of it, by retail, at the prime cost and charges, to the poorer classes of citizens, whose means do not enable them to buy much in advance. Such an association might do a vast amount of good, without ever expending a single dollar. Suppose, for example, a hundred citizens, of well known respectability, and sufficient pecuniary responsibility, should enter into an association for the purpose named, and should purchase a given amount of coal at six months credit, each member of the association being jointly and severally responsible for the indebtedness of the whole. The coal might then be put at such a price as, when all was sold, would yield the net cost and charges; and before the obligations of the company should fall due, the money would be in hand to discharge them. This would be a cheap charity on the part of those who engaged in it, and a most valuable one to those classes of citizens for whose benefit it would be intended.
THE CORPORATION QUESTION
Plaindealer, December 24, 1836.
One of the newspapers which has done us the honour to notice this journal, animadverts, with considerable asperity, upon our declaration of interminable hostility to the principle of special incorporation, and points our attention to certain incorporated institutions, which, according to the universal sense of mankind, are established with the purest motives, and effect the most excellent objects. The ready and obvious answer to the strictures we have provoked is, that it is the means, not the end, which furnishes the subject of our condemnation. An act of special incorporation may frequently afford the persons associated under it facilities of accomplishing much public good; but if those facilities can only be given at the expense of rights of paramount importance, they ought to be denied by all whose political morality rejects the odious maxim that the end justifies the means. It would be a very strained and unwarrantable inference from any remarks we have made, to say that we are an enemy to churches, public libraries, or charitable associations, because we express hostility to special legislation. It would be an unwarranted inference to say that we are even opposed to the principle of incorporation; since it is only to the principle of special incorporation that we have expressed hostility. We are opposed, not to the object, but to the mode by which the object is effected. We are opposed, not to corporation partnerships, but to the right of forming such partnerships being specially granted to the few, and wholly denied to the many. We are opposed, in short, to unequal legislation, whatever form it may assume, or whatever object it may ostensibly seek to accomplish.
It has been beautifully and truly said, by the illustrious man who presides over the affairs of our Confederacy, that "there are no necessary evils in government. Its evils exist only in its abuses. If it would confine itself to equal protection, and, as heaven does its rains, shower its favours alike on the high and the low, the rich and the poor, it would be an unqualified blessing." But it departs from its legitimate office, it widely departs from the cardinal principle of government in this country, the equal political rights of all, when it confers privileges on one set of men, no matter for what purpose, which are withheld from the rest. It is in this light we look upon all special acts of incorporation. They convey privileges not previously enjoyed, and limit the use of them to those on whom they are bestowed. That special charters are, in many instances, given for objects of intrinsic excellence and importance, is freely admitted; nor do we desire to withhold our unqualified acknowledgment that they have been the means of effecting many improvements of great value to the community at large. Let it be clearly understood, then, that we do not war against the good achieved; but seek only to illustrate the inherent evil of the means. A special charter is a powerful weapon; but it is one which should have no place in the armory of the democracy. It is an instrument which may hew down forests, and open fountains of wealth in barren places; but these advantages are purchased at too dear a rate, if we give for them one jot or tittle of our equal freedom. As a general rule, too, corporations act for themselves, not for the community. If they cultivate the wilderness, it is to monopolize its fruits. If they delve the mine, it is to enrich themselves with its treasures. If they dig new channels for the streams of industry, it is that they may gather the golden sands for themselves, as those of Pactolus were gathered to swell the hoards of Croesus.
Even if the benefits, which we are willing to admit have been effected by companies acting under special corporate privileges and immunities, could not have been achieved without the assistance of such powers, better would it have been, in our opinion, far better, that the community should have foregone the good, than purchase it by the surrender, in any instance or particular, of a principle which lies at the foundation of human liberty. No one can foretell the evil consequences which may flow from one such error of legislation. "Next day the fatal precedent will plead." The way once open, ambition, selfishness, cupidity, rush in, each widening the breach, and rendering access easier to its successor. The monuments of enterprise erected through the aid of special privileges and immunities are numerous and stupendous; but we may yet be sadly admonished
—"how wide the limits stand,
But, fortunately, we are not driven to the alternative of either foregoing for the future such magnificent projects as have heretofore been effected by special legislation, or for the sake of accomplishing them, continuing to grant unequal privileges. It is a propitious omen of success in the great struggle in which the real democracy of this country are engaged, that monopolies, (and we include in the term all special corporate rights) are as hostile to the principles of sound economy, as they are to the fundamental maxims of our political creed. The good which they effect might more simply and more certainly be achieved without their aid. They are fetters which restrain the action of the body politic, not motories which increase its speed. They are jesses which hold it to earth, not wings that help it to soar. Our country has prospered, not because of them, but in spite of them. This young and vigorous republic has bounded rapidly forward, in despite of the burdens which partial legislation hangs upon its neck, and the clogs it fastens to its heel. But swifter would have been its progress, sounder its health, more prosperous its general condition, had our law-makers kept constantly in view that their imperative duty requires them to exercise their functions for the good of the whole community, not for a handful of obtrusive and grasping individuals, who, under the pretext of promoting the public welfare, are only eager to advance their private interests, at the expense of the equal rights of their fellow-men.
Every special act of incorporation is, in a certain sense, a grant of a monopoly. Every special act of incorporation is a charter of privileges to a few, not enjoyed by the community at large. There is no single object can be named, for which, consistently with a sincere respect for the equal rights of men, a special charter of incorporation can be bestowed. It should not be given to establish a bank, nor to erect a manufactory; to open a road, nor to build a bridge. Neither trust companies nor insurance companies should be invested with exclusive rights. Nay, acting in strict accordance with the true principles both of democracy and political economy, no legislature would, by special act, incorporate even a college or a church. Let it not be supposed, however, that we would withhold from such institutions the intrinsic advantages of a charter. We would only substitute general, for partial legislation, and extend to all, the privileges proper to be bestowed upon any. The spirit of true wisdom, in human affairs, as in divine,
"Acts not by partial, but by general laws."
Nothing can be more utterly absurd than to suppose that the advocacy of these sentiments implies opposition to any of the great undertakings for which special legislative authority and immunities are usually sought. We are opposed only to a violation of the great democratic principle of our government; that principle which stands at the head of the Declaration of Independence; and that which most of the states have repeated, with equal explicitness, in their separate constitutions. A general partnership law, making the peculiar advantages of a corporation available to any set of men who might choose to associate, for any lawful purpose whatever, would wholly obviate the objections which we urge. Such a law would confer no exclusive or special privileges; such a law would be in strict accordance with the great maxim of man's political equality; such a law would embrace the whole community in its bound, leaving capital to flow in its natural channels, and enterprise to regulate its own pursuits. Stock bubbles, as fragile as the unsubstantial globules which children amuse themselves with blowing, might not float so numerous in the air; but all schemes of real utility, which presented a reasonable prospect of profit, would be as readily undertaken as now. That active spirit of enterprise, which, in a few months, has erected a new city on the field lately desolated by the direst conflagration our history records; that spirit of enterprise, which every year adds whole squadrons to the innumerous fleet of stately vessels that transport our commerce to the remotest harbours of the world; that spirit of enterprise which seeks its object alike through the freezing atmosphere of the polar regions, and beneath the fervour of the torrid zone, displaying the stars and stripes of our country to every nation of the earth; that active spirit would not flinch from undertaking whatever works of internal improvement might be needed by the community, without the aid of exclusive rights and privileges.
The merchant, who equips his noble vessel, freights her with the richest products of nature and art, and sends her on her distant voyage across the tempestuous sea, asks no act of incorporation. The trader, who adventures his whole resources in the commodities of his traffic, solicits no exclusive privilege. The humble mechanic, who exhausts the fruit of many a day and night of toil in supplying his workshop with the implements of his craft, desires no charter. These are all willing to encounter unlimited competition. They are content to stand on the broad basis of equal rights. They trust with honourable confidence, to their own talents, exercised with industry, not to special immunities, for success. Why should the speculators, who throng the lobbies of our legislature, be more favoured than they? Why should the banker, the insurer, the bridge builder, the canal digger, be distinguished by peculiar privileges? Why should they be made a chartered order, and raised above the general level of their fellow-men?
It is curious to trace the history of corporations, and observe how, in the lapse of time, they have come to be instruments that threaten the overthrow of that liberty, which they were, at first, effectual aids in establishing. When the feudal system prevailed over Europe, and the great mass of the people were held in vilest and most abject bondage by the lords, to whom they owed strict obedience, knowing no law but their commands, the power of the nobles, by reason of the number of their retainers and the extent of their possessions, was greater than that of the monarch, who frequently was a mere puppet in their hands. The barons, nominally vassals of the crown, holding their fief on condition of faithful service, were, in reality, and at all times, on any question which combined a few of the more powerful, absolute masters. They made kings and deposed them at pleasure. The history of all the states of Europe is full of their exploits in this way; but the narrative of the red and white rose of England, of the contending houses of York and Lancaster, is all that need be referred to for our present purpose. Corporations were the means at last happily hit upon of establishing a power to counterbalance that so tyrannously and rapaciously exercised by the barons. For certain services rendered, or a certain price paid, men were released from the conditions which bound them to their feudal lords, and all so enfranchised were combined in a corporate body, under a royal charter of privileges and immunities, and were termed "freemen of the corporation." In process of time, these bodies, by gradual and almost imperceptible additions, grew to sufficient size to afford a countercheck to the power of the nobles, and were at last the instruments, not in England only, but throughout Europe, of overthrowing the feudal system, emancipating their fellow-men from degrading bondage, and establishing a government somewhat more in accordance with the rights of humanity.
But in this country, founded, in theory and practice, on an acknowledgment, in the broadest sense, of the universal right of equal freedom, the grant of special corporate privileges is an act against liberty, not in favour of it. It is not enfranchising the few, but enslaving the many. The same process which, when the people were debased, elevated them to their proper level, now, when the people are elevated, and occupy the lofty place of equal political rights, debases them to comparative servitude. The condition of things in free America is widely different from that which existed in Europe during the feudal ages. How absurd then, to continue a system of grants, for which all actual occasion long since ceased, and which are now at utter and palpable variance with the great political maxim that all alike profess! It is our desire, however, in treating this subject, to use no language which may embitter the feelings of those who entertain contrary views. We wish to win our way by the gentle process of reason; not by the boisterous means which angry disputants adopt. It has, in all times, been one of the characteristic errors of political reformers, and we might say, indeed, of religious reformers, too, that they have threatened, rather than persuaded; that they have sought to drive men, rather than allure. Happy is he "whose blood and judgment is so well commingled," that he can blend determined hostility to public errors and abuses, with sufficient tolerance of the differences of private opinion and prejudice, never to relinquish courtesy, that sweetener of social life and efficient friend of truth. In a small way, we seek to be a reformer of certain false principles which have crept into our legislation; but as we can lay no claim to the transcendent powers of the Miltons, Harringtons and Fletchers of political history, so we have no excuse for indulging in their fierceness of invective, or bitterness of reproach.
FREE TRADE WEIGHTS AND MEASURES
Plaindealer, December 24, 1836. Title added.
The American is a newspaper in which articles often appear indicating that it entertains a strong attachment to the principles of free trade, and a desire that the law of free competition should be the only law to regulate the pursuits of industry, so far as they do not interfere with the morals or order of society. It was with surprise and regret, therefore, that we read in that journal, a few evenings since, a paragraph commendatory of the tyrannical act, now under the consideration of our municipal authorities, relative to bread, and expressing a wish that it may become a law. The paragraph referred to is in the following words:
We are adverse, on principle, to all laws regulating the quality, or price, of any article, and of course, therefore, adverse to an assize, as to the price or quality, of bread, as we are to all inspection laws. But policy and justice alike require that false weights shall not be permitted to pass current, and, therefore, we see no objection, but all fitness, in an ordinance that the loaf should be of a given weight, leaving it to the seller and the purchaser to arrange the price for themselves.
Would the American see "all fitness" in a law requiring the butchers to cut beef into one, two, and four pound pieces, or into pieces of any other stipulated weight? Would it see fitness in requiring that a quarter of lamb should be of a given weight, or that a bunch of onions should contain a certain number, and of a certain size? There is no law hindering people to buy their bread by the pound, if they choose; and there is no reason why other persons than the members of the special bread committee of the Board of Assistant Aldermen may not discover, if they think the search worth their while, the shops where the largest loaves are sold. The law does quite as much as is necessary for the protection of the community, (this is always the pretext for these arbitrary restraints on the freedom of trade) when it fixes a standard of weights and measures, and requires all persons selling by them to have them stamped and certified by a duly appointed officer. We have our doubts, indeed, whether even in going so far, it has not exceeded the proper business of legislation. We have our doubts whether it should not stop when it has simply fixed the standard, leaving buyers and sellers free to conform to it or not, as they choose. There is no inspector of yardsticks; and yet we doubt very much if people who buy by the yard do not generally contrive to get good measure. If they do not it is their own look out. We would have it the same with regard to bread. We would let the purchaser take care of himself. The law has furnished him with all the necessary appliances and means to see that he gets good weight and measure, and the rest of the affair ought to be trusted to his own shrewdness and sagacity. The familiar saying, that a man's eyes are his best chapman, contains more wisdom than our corporation ordinances; and we were in hopes to have the American's cooperation in enforcing it as a rule of publick conduct, in regard to the matter now under consideration.
Plaindealer, January 14, 1837. Extract deleted.
The views which have been expressed in this journal, on the subject of associated effort, have provoked some animadversion. Among other papers that have expressed disapprobation of our sentiments is the Montreal Transcript, which has recorded its dissent in the following courteous and complimentary terms:
The Montreal Transcript may rest assured that it is by no means our desire, on the subject of combinations, or on any other subject, to throw dust into the eyes of our readers. If we even possessed such power of argument and such felicitous command of language as it ascribes to us, and could easily make the worse appear the better reason, we trust we should be governed by too just a sense of the duties and responsibilities of our vocation, ever to lend ourselves to the support of errour, for the sake of displaying our ingenuity, or the copiousness of our logical resources. What we have said on the subject of combination we fully believe is the true doctrine; but we are inclined to think, from some of the phrases in the foregoing paragraph, that the Montreal paper understands our remarks in a wider sense than they we[re] intended. On one point it is plain that we are misapprehended.
The maxim that the end justifies the means is one which we utterly repudiate. Not only did the Plaindealer never avow nor act upon that sentiment; but it cannot be found in anything written by its conductor, in any other medium of communicating with the publick. We hold that the saying is in direct opposition to the soundest and most obvious principles of morals, and ought never to be countenanced, in any possible circumstances, nor for the attainment of any possible object. The means must justify themselves; or no end, however desirable, and no exigency, however pressing, can wholly excuse their being employed. In the case adverted to, we considered that a combination on the part of those who suffer from the fraudulent practice of paying operatives their wages in depreciated paper would be justified, not as an exception to a general rule, but as in entire conformity with the universal, invariable, and immutable rule of right. It is on this ground, and on this alone, that we wish the propriety of our counsel to be judged.
The broad and comprehensive position we maintain on the subject of combinations is this: that the means are proper in themselves; and that it is the end alone which, in any case, is obnoxious to censure. We hold that both the principles of free trade, and the plainest principles of natural equity require, that men should be left at liberty to pursue by concert, if they choose, any object they have a right to achieve by individual action. The safety of the community against extortionate and intolerant combinations is sufficiently insured by the effect of competition and the influence of publick opinion.
It seems to us that the Montreal Transcript, in making an exception in favour of a combination of operative mechanicks against the extortionate and fraudulent practices of employers, surrenders the whole ground of argument. The admission is fatal to the position it assumes. It is equivalent to an acknowledgement that the propriety or impropriety of a combination depends on the character of the object which it is sought to accomplish. This is precisely the ground we maintain. We assert the right to combine, but do not defend the abuse of that right; as, in the same way, we assert the right of free discussion, but shall never be found among the apologists of an intemperate and pernicious exercise of that right.
But if we admit that the line may be distinctly drawn (which it cannot be) between combinations for a good purpose, and combinations for a bad purpose, the question then comes up whether we would make those in the latter category punishable by law. We answer no. We would punish by law those persons who undertook to achieve by combination, what it would be punishable by law to undertake to achieve by separate unconcerted action, and no others.
The Montreal journalist might suppose a variety of cases in which the community would be great sufferers from a combination of persons to effect certain objects, which never could be effected by spontaneous individual action. We should then answer him by supposing cases in which the action of a single extortionate individual, without transcending his undoubted legal rights, might be productive of great evil; and we should further show that the steady influence of publick opinion is the best law to regulate the conduct of associations and individuals in both classes of cases. A combination of a hundred wealthy men might, under peculiar circumstances of season, monopolize all the provisions in this city, and refuse to sell a starving inhabitant a mouthful of food, unless he paid its weight in gold. A single individual without wealth, a poor fisherman, for example, might have it in his power to rescue a hundred men from certain death at sea, and might refuse to do so, unless each promised to pay him his weight in gold for the service. The fisherman does not do so, because publick opinion, composed of the general sentiment of humanity as applicable to the subject, his own notions of humanity included, is a supreme law to regulate his conduct. The hundred rich men, in the same way, do not monopolize all the food, and retail it at a dollar an ounce, because they are restrained by the same supreme law.
The Montreal Transcript will yet discover, we hope, that it egregiously misapprehends the real tendency of our doctrines. We are quite willing to admit that combinations to regulate prices are, for the most part, very foolish and expensive undertakings, and, in familiar phrase, cost much more than they come to. But this very fact furnishes a reason why the combiners should be left to themselves. If they have a taste for expensive amusements, let them indulge themselves; for those who pay the piper surely have a right to dance.
All that we have here said is comprehended in a very brief sentence, which was once, a long time since, uttered by the leading men of the mercantile community of France, when they were asked by the minister what they desired the government to do to promote their interests. Their reply, though it consists of but three words, comprises a whole volume of political wisdom. It was, Laissez nous faire.
SALE OF PUBLICK LANDS
Plaindealer, January 14, 1837. Title added.
Will the editor of the Plaindealer oblige us by an exposition and application of his free trade principles, as they may or should be adapted to the sale of the Publick Lands? More concisely, will he inform us whether he does or does not deem a restriction of the sales of publick lands to actual settlers on the same, constitutional, salutary and proper?
The above is from a weekly contemporary print, published in this city, called the New Yorker. Without acknowledging any right which that or any other journal has to catechize us on subjects on which we have offered no opinions, we yet have no objection whatever to answer the question put to us.
Free trade we take to consist in the buyer and seller being left to make their own bargain; it would therefore be no violation of the principles of free trade for the Government, which is the seller in the case stated, to ask any price, or make any conditions it thought proper, in disposing of the publick lands. So much for the free trade part of the question.
The constitutionality of such a restriction as is stated depends upon the fact whether there is or is not any clause in the Constitution of the United States stipulating the mode and terms of sale in regard to the publick lands. The Constitution of the United States says that "the Congress shall have power to dispose of, and make all needful rules and regulations respecting, the territory or other property belonging to the United States." As there is here no limitation of power as to the mode or terms of the sale of the publick lands, we should think the constitutionality of the restriction about which we are asked could not be doubted.
With regard to the propriety of the restriction, the question, in our view, should be decided by a careful consideration of it solely as it will tend to promote the greatest good of the greatest number. That this object would be most certainly effected by that mode of disposal which would lead to the largest amount of actual settlement upon, and cultivation of, the publick lands, we do not doubt.
Having thus been drawn out to express our views on this subject, which we certainly had no desire to withhold, may we take the liberty to ask the New Yorker a question? We understand it to be in favour of special legislation in regard to banking, insuring against losses from fire and the perils of the sea, &c. Will it be good enough to inform us why the business of manufacturing gilt ginger bread and sugar whistles is not as much entitled to be protected by special charters and the provisions of a restraining law, as that of bankers and insurers?
MANACLES INSTEAD OF GYVES
Plaindealer, January 21, 1837. Extract deleted.
The American, some days ago, in an article on the subject of the laws relative to pilots, proposed the following as the features proper to be embraced in a new law on the subject:
We see, also, by the newspapers, that a committee of merchants have drawn up a scheme, which embraces similar provisions. It proposes to have appointed, by legislative authority, a Board of Commissioners, whose business it shall be to superintend the whole pilot system, to examine candidates, appoint and license pilots, and attend to the enforcement of a multitude of minute and complicated arrangements.
It seems to us that this scheme merely recommends manacles instead of gyves; that it is a mere substitution of one kind of fetter for another. It would diminish the burden, but does not propose to cast it off entirely. It mitigates the evil, but does not go to the extent of abating it. It enlarges our bounds, but does not give us freedom. Is not the piloting of our vessels, in and out of our harbour a simple matter of trade? Then why not leave it to be governed by the laws of trade? Why should it be a matter of political regulation? Why should control of the subject be left to a body of legislators, nine-tenths of whom cannot, in the nature of things, be supposed to have any knowledge concerning it? Why should it not be submitted to the operation of those principles, which, in all the affairs of trade to which they have ever been applied, have invariably been found of adequate efficacy?
The ocean, beyond the limits of our jurisdiction, has its bars and rocks and quicksand; yet no difficulty is experienced in finding persons of sufficient knowledge and skill to guide commerce through all its dangers, without asking legislative supervision, or requiring those entrusted with the important business to be authenticated by official appointment. It seems to us if the business of piloting a vessel were left equally free from political interference, with that of navigating it across the ocean, the result would be greatly to the advantage of all concerned, directly or indirectly, except those only who fatten on the unearned fruits of monopoly, and those who derive an undue political influence from the power of dispensing official patronage.
If there were no law regulating the number of pilots, it would be fixed by that law of trade which adjusts the supply to the demand. The compensation would also be adjusted, in the same way, by the amount of competition; as the wages of masters and mates of vessels, and of seamen, for any given voyage, or as the prices of any other service or commodity, are now fixed. Ignorant and unskilful persons might engage in the business; but competition here again would remedy the difficulty. It would naturally lead those possessing the requisite qualifications to obtain the best sort of credential which, under any circumstances, they could possible have, namely, a certificate, duly authenticated, from a board constituted by the underwriters and merchants. It might lead, also, to the formation of rival joint stock pilot associations, of sufficient capital to afford ample pecuniary guarantees against loss by the carelessness or ignorance of those employed. The insurers, also, would devise a code of regulations for their own security, the tendency of which would necessarily be to promote the interests of commerce, for the interests of commerce and of the insurers are identical.
We do not like to speak with unbecoming positiveness on this subject, lest we incur an application to ourselves of the sentiment of Pope, that "fools rush in, where angels fear to tread;" yet we must say that, after a good deal of meditation on the subject, and an examination of it by such tests as our knowledge supplies, we have arrived at the conviction that the business of piloting might as safely be left to the principles of absolute free trade, as any other business whatever. If there were no law to regulate the subject, it may be said, an extortionate pilot might, under peculiar circumstance, exact an exorbitant compensation, and refuse to act unless it were paid. A physician, or surgeon, too, might be brought to the bedside of an affluent patient under circumstances which required instant medical or chirurgical aid, and refuse to administer the potion or the knife, on which all hope depended, without being previously paid an enormous remuneration. If the common sentiment of mankind, in the one case as well as the other, were not sufficient to prevent the attempt of such extortion, could a jury be found that would ratify the compulsory bargain?
If the laws of trade would of themselves lead to the best results in regard to piloting, we think no one will dispute that it would then be clearly proper to separate the subject from political control. We are of those, who, as a principle of abstract political doctrine, desire to confine government to the fewest possible offices. Those who differ from us in political creed, and, as an abstract principle, desire to strengthen the powers and multiply the functions of government, will yet admit that it is desirable to retrench power in the hands of its present possessors. Thus, on the one ground or the other, we should count upon the cooperation of both the democracy and the aristocracy, to bring about the emancipation of trade, in the respect of which we speak, if it could be shown that the simple principle of competition is adequate to all the purposes which the law now vainly attempts to enforce. That it is so we do not entertain a doubt; and the opinion is sustained by every species of analogical reasoning to which it can be subjected. The experiment could not, at any rate, place our commerce in worse peril than it is exposed to by our present system; and, in that view of the subject, is it not worth a trial?
THE MEANING OF FREE TRADE
Plaindealer, January 28, 1837. Title added.
In our last number but one, we replied to some questions put to us by a weekly contemporary print, the New Yorker, on the subject of the conditions proposed, in Mr. Walker's land bill, to be annexed to the sale of publick lands. The views we there expressed do not meet the approbation of our querist, who enters into a discussion of them at so great a length, as forbids alike our copying the article entire, and our replying to all the points of the argument. Some of them, however, shall receive such attention as our limits permit us to bestow. Our definition of free trade, that it consists in the buyer and seller being left to make their own bargain, does not seem to satisfy the New Yorker, which confesses that it has heretofore looked on the term as expressive of a much wider signification. We quote the passage:
"Free trade," says our enlightener, "we take to consist in the buyer and seller being left to make their own bargain." Indeed! In the plenitude of our ignorance we had given a much wider signification to the phrase. Let us illustrate: Suppose on the next day that the new tariff bill before the House of Representatives is under discussion in Committee of the Whole, Mr. C. C. Cambreleng should propose an increase of the duty on iron imported to one hundred per cent, except iron intended for the construction of railroads, which should be admitted free of duty. There would doubtless be evinced what is called a "sensation," and some member, ignorant, like us, of the true import of the term, might accuse the honourable gentleman of an abandonment or violation of the principles of free trade, for his consistent support of which he has long been distinguished. "You mistake," replies the commercial representative, with a compassionating smile; "free trade consists in the buyer and seller being allowed to make their own bargain; and as I propose no restriction of this liberty, my free trade consistency is unimpeachable." The caviller, rebuked, instructed, and satisfied, would of course humbly acknowledge his errour. Now, if it be true that free trade has no further import than this, we must of course stand corrected. But we have hitherto understood that the law which authorizes so many pilots and no more to conduct vessels into the harbour of New York, (though allowing shipmasters to "make their own bargains") and the law which forbids the keeping of offices of discount and deposite by individuals or voluntary associations (though allowing depositors and the banks to "make their own bargains") are violations of the principle of free trade. As such, we have advocated their unqualified repeal; and we have thought the strenuous and efficient hostility of the Plaindealer to these and many kindred restrictions was based on a like conviction. We appeal, then, to the common sense of the reader to bear us out in the assertion that the passage of a law restricting the sales of publick lands to those only who would bind themselves to settle upon and cultivate the same, would be a measure of the same generick kind with those which, under such sounding titles as "the American system," "protection to domestick industry," &c. &c. have encountered the unremitting and ardent hostility of the editor of the Plaindealer for years past. It is a system of cobbling, and forcing, and discriminating, designed to supersede one of real and palpable free trade.
And again, after expatiating at some length on the difficulties which it supposes would be experienced in carrying the provisions of Mr. Walker's land bill into effect, and the presumed evil consequences which would result from them, the New Yorker says:
We do not assert that the Plaindealer sees all this as we do; but we do believe that it cannot give an hour's consideration to this system of restriction to actual settlers without being convinced that it is not a free trade system. It surely cannot believe that an act providing that a blacksmith might buy publick lands, but a physician must not—that a Kentuckian might have lands at fifty cents per acre, while a Pennsylvanian should not have them at any price—would be consistent with the broad and distinctive principles which it has hitherto maintained. And yet it affirms as much in its sweeping assertion that it would be no violation of the principles of free trade for the government to make any conditions it thought proper.
If Mr. Cambreleng should be guilty of the silly conduct which the New Yorker has taken for one of its illustrative hypotheses, he certainly would commit a very egregious violation of the plainest principles of free trade; simply because he would not, in that case, leave the buyer and seller free to make their own bargain, but would seek to thrust a prodigious legislative barrier between them. The buyers, in the case supposed, are the workers and consumers of iron in this country; and the sellers are those who deal in the article in Great Britain. The trade between them is free, when no legislative hindrances, of any kind, are interposed by a third party. Congress, in this case, is that third party; and the buyer and seller are not left alone to make their bargain; but the third party steps in with its conditions, which are of as imperative obligation on the purchaser, as those of the seller.
In the other case adduced, that of the pilots, the errour is the same. The buyers are those who have occasion for the services of pilots; and the sellers are those who have such services to dispose of. The trade between them would be free, if each party were left to make its own bargain, without legal limitation or restraint. But the legislature is a third party, and says to those needing the aid of the pilots, you shall not be free to make your own bargain, but, will you, nill you, you must take a pilot of my appointing, or at all events, whether you take one or not, you must pay as if the service were actually rendered. And it says to the pilots, you shall not be left free to charge that rate which the demand for your services and the amount of free competition might warrant, but you shall always, be the circumstances what they may, and be the service relatively worth more or less, have liberty to charge, and power to enforce your demand, according to certain immutable rates, which are hereby established. This is not free trade, because this is not leaving the buyer and seller free to make their own bargain. They are both under the necessity of deferring to a third party, who makes the bargain for them.
So also in the other case which has been chosen as of analogous force, that of the law which forbids all except specially chartered corporations from keeping offices of discount and deposite. It is an errour to say that the depositors and the banks are free to make their own bargains. The depositors are not free, because the law restricts them to a certain limited number of companies, and says, in effect, you shall not deposite your money except with A, B, or C, and none but A, B, and C, are authorized to discount your note. You shall not, therefore, make your own bargain; but you shall be subject to the conditions which the shutting up of the business of discount and deposite in such narrow bounds, by counteracting the effect of competition, will necessarily impose upon you. Here, as in the other cases, a third party interposes between buyer and seller; and consequently they are not free to make their own bargain, or, in other words, their rights of free trade are violated.
Our antagonist is mistaken in supposing that we should consider a law in relation to the publick lands, exactly and particularly designating the classes and descriptions of persons who might and who might not buy those lands, a violation of the principles of free trade. We should certainly consider it a very absurd law, but absurd on different grounds from those imputed. There are many modes in which government may abuse its powers besides by violating the principles of free trade; as there are many ways in which a man may commit crime, without taking the life of a fellow being. If a person should be proved guilty of forgery, the jury would hardly be instructed to bring in a verdict of wilful murder; and so, if the government should impose very silly conditions upon itself with regard to the publick lands, we should not pronounce it guilty of violating the freedom of trade. The government has the sole and absolute right of disposal of the publick lands, under but one limitation: that of disposing of them for the general welfare. The conditions which it imposes upon itself, or the terms which it annexes to the sale, may be unwise, and subversive of the professed object; but cannot properly be considered a violation of free trade, any more than could the conduct of the proprietor of the New Yorker, if he refused to sell his paper except to a particular class of purchasers, or to none, except for their own exclusive use, and on the express condition that they would not resell. If a third party, the legislature for example, imposed these conditions, they would be a violation of free trade, inasmuch as they would come between buyer and seller, and would not leave them free to make their own bargain. But it is no more a violation of free trade for the seller to say, I will not sell except on certain terms, than for the buyer to say, I will not buy, except at a certain price.
The New Yorker, it seems, is less of a monopolist than we had been led to suppose. It says:
Having uniformly advocated the unqualified repeal of the Restraining Law, the removal of all kindred restraints, and the reform of our banking system generally, we feel that we are unjustly ranked with the advocates of chartered monopolies. All the restriction on banking we desire is, simply the restriction of the right of issuing paper as money to those alone (whether individuals or companies) who shall establish before a proper tribunal that they are unquestionably able to redeem a certain amount of paper whenever called upon, and such a constant supervision over them as shall ensure their continued solvency. As to insurance, we do not regard such a supervision as so necessary, but we think it would be found salutary. We want no charters, (unless the above is a charter,) no distribution of stock, no exclusive privileges, no restrictions, except the restriction of the power of coining paper money to those who are able to redeem it.
This shows, whatever erroneous notions the New Yorker may entertain as to the definition of the term free trade, that it has made greater advances towards the thing, than many journals which make a more boastful display of their economick knowledge. We trust a little further investigation will satisfy it that the salutary restrictions, which it is now in favour of having imposed by legislative authority, would be much more certainly and efficiently imposed by the laws of free trade. They would be the natural and necessary consequence of unrestricted competition.