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Protection or Free Trade

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« on: October 26, 2010, 02:58:00 pm »



WE have sufficiently seen the effect of protection on the production of wealth. Let us now inquire as to its effect on wages. This is a question of the distribution of wealth.

Discussions of the tariff question seldom go further than the point we have now reached, for though much is said, in the United States at least, of the effect of protection on wages, it is as a deduction from what is asserted of its effect on the production of wealth. Its advocates claim that protection raises wages; but in so far as they attempt to prove this it is only by arguments, such as we have examined, that protection increases the prosperity of a country as a whole, from which it is assumed that it must increase wages. Or when the claim that protection raises wages is put in the negative form (a favorite method with American protectionists) and it is asserted that protection prevents wages from falling to the lower level of other countries, this assertion is always based on the assumption that protection is necessary to enable production to be carried on at the higher level of wages, and that if it were withdrawn production would so decline, by reason of the underselling of home producers by foreign producers, that wages must also decline.

But although its whole basis has already been overthrown, let us (since this is the most important part of the question) examine directly and independently the claim that protection raises (or maintains) wages.

Though the question of wages is primarily a question of the distribution of wealth, no protectionist writer that I know of ventures of treat it as such, and free-traders generally stop where protectionists stop, arguing that protection must diminish the production of wealth, and (so far as they treat the matter of wages) from this inferring that protection must reduce wages. For purposes of controversy this is logically sufficient, since, free trade being natural trade, the onus of proof must lie upon those who would restrict it. But as my purpose is more than that of controversy, I cannot be contented with showing merely the unsoundness of the arguments for protection. A true proposition may be supported by a bad argument, and to satisfy ourselves thoroughly as to the effect of protection we must trace its influence on the distribution, as well as on the production of wealth. Error often arises from the assumption that what benefits or injures the whole must in like manner affect all its parts. Causes which increase or decrease aggregate wealth often produce the reverse effect on classes or individuals. The resort to salt instead of kelp for obtaining soda increased the production of wealth in Great Britain, but lessened the income of many Highland landlords. The introduction of railways, greatly as they have added to aggregate wealth, ruined the business of many small villages. Out of wars, destructive to national wealth though they be, great fortunes arise. Fires, floods, and famines, while disastrous to the community, may prove profitable to individuals, and he who has a contract to fill, or who has speculated in stocks for a fall, may be enriched by hard times.

As, however, those who live by their labor constitute in all countries the large majority of the people, there is a strong presumption that no matter who else is benefited, anything that reduces the aggregate income of the community must be injurious to working-men. But that we may leave nothing to presumption, however strong, let us examine directly the effect of protective tariffs on wages.

Whatever affects the production of wealth may at the same time affect distribution. It is also possible that increase or decrease in the production of wealth may, under certain circumstances, alter the proportions of distribution. But it is only with the first of these questions that we have now to deal, since the second goes beyond the question of tariff, and if it shall become necessary to open it, that will not be until after we have satisfied ourselves as to the tendencies of protection.

Trade, as we have seen, is a mode of production, and the tendency of tariff restrictions on trade is to lessen the production of wealth. But protective tariffs also operate to alter the distribution of wealth, by imposing higher prices on some citizens and giving extra profits to others. This alteration of distribution in their favor is the impelling motive with those most active in procuring the imposition of protective duties and in warning workmen of the dire calamities that will come on them if such duties are repealed. But in what way can protective tariffs affect the distribution of wealth in favor of labor? The direct object and effect of protective tariffs is to raise the price of commodities. But men who work for wages are not sellers of commodities; they are sellers of labor. They sell labor in order that they may buy commodities. How can increase in the price of commodities benefit them?

I speak of price in conformity to the custom of comparing other values by that of money. But money is only a medium of exchange and a measure of the comparative values of other things. Money itself rises and falls in value as compared with other things, varying between time and time, and place and place. In reality the only true and final standard of values is labor—the real value of anything being the amount of labor it will command in exchange. To speak exactly, therefore, the effect of a protective tariff is to increase the amount of labor for which certain commodities will exchange. Hence it reduces the value of labor just as it increases the value of commodities.

Imagine a tariff that prevented the coming in of laborers, but placed no restriction on the coming in of commodities. Would those who have commodities to sell deem such a tariff for their benefit? Yet to say this would be as reasonable as to say that a tariff upon commodities is for the benefit of those who have labor to sell.

It is not true that the products of lower priced labor will drive the products of higher prices labor out of any market in which they can be freely sold, since, as we have already seen, low priced labor does not mean cheap production, and it is the comparative, not the absolute, cost of production that determines exchanges. And we have but to look around to see that even in the same occupation, wages paid for labor whose products sell freely together, are generally higher in large cities than in small towns, in some districts than in others.

It is true that there is a constant tendency of all wages to a common level, and that this tendency arises from competition. But, this competition is not the competition of the goods market; it is the competition of the labor market. The differences between the wages paid in the production of goods that sell freely in the same market cannot arise from checks on the competition of goods for sale; but manifestly arises from checks on the competition of labor for employment. As the competition of labor varies between employment and employment, or between place and place, so do wages vary. The cost of living being greater in large cities than in small towns, the higher wages in the one are not more attractive than the lower wages in the other, while the differing rates of wages in different districts are manifestly maintained by the inertia and friction which retard the flow of population, or by causes, physical or social, which produce differences in the intensity of competition in the labor-market.

The tendency of wages to a common level is quickest in the same occupation, because the transference of labor is easiest. There cannot be, in the same place, such differences in wages in the same industry as may exist between different industries, since labor in the same industry can transfer itself from employer to employer with far less difficulty than is involved in changing an occupation. There are times when we see one employer reducing wages and others following his example, but this occurs too quickly to be caused by the competition of the goods market. It occurs at times when there is great competition in the labor market, and the same conditions which enable one employer to reduce wages enable others to do the same. If it were the competition of the goods market that brought wages to a level, they could not be raised in one establishment or in one locality unless at the same time raised in others that supplied the same market; whereas, at the times when wages go up, we see workmen in one establishment or in one locality first demanding an increase, and then, if they are successful, workmen in other establishments or localities following their example.

If we pass now to a comparison of occupation with occupation, we see that although there is a tendency to a common level, which maintains between wages in different occupations a certain relation, there are, in the same time and place, great differences of wages. These differences are not inconsistent with this tendency, but are due to it, just as the rising of a balloon and the falling of a stone exemplify the same physical law. While the competition of the labor market tends to bring wages in all occupations to a common level, there are differences between occupations (which may be summed up as differences in attraction and differences in the difficulty of access) that check in various degrees the competition of labor and produce different relative levels of wages. Though these differences exist, wages in different occupations are nevertheless held in a certain relation to each other by the tendency to a common level, so that a reduction of wages in one trade tends to bring about a reduction in others, not through the competition of the goods market, but through that of the labor market. Thus cabinet makers, for instance, could not long get $2 where workmen in other trades as easily learned and practised were only getting $1, since the superior wages would so attract labor to cabinet making as to increase competition and bring wages down. But if the cabinet makers possessed a union strong enough to strictly limit the number of new workmen entering the trade, is it not clear that they could continue to get $2 while in other trades similar labor was only getting $1? As a matter of fact, trades-unions, by checking the competition of labor, have considerably raised wages in many occupations, and have even brought about differences between the wages of union and non-union men in the same occupation. And what limits the possibility of thus raising wages is clearly not the free sale of commodities, but the difficulty of restricting the competition of labor.

Do not these facts show that what American work-men have to fear is not the sale in our goods market of the products of "cheap foreign labor," but the transference to our labor market of that labor itself? Under the conditions existing over the greater part of the civilized world, the minimum of wages is fixed by what economists call the "standard of comfort"—that is to say, the poorer the mode of life to which laborers are accustomed the lower are their wages and the greater is their ability to compel a reduction in any labor market they enter. What, then, shall we say of that sort of "protection of American working-men" which, while imposing duties upon goods, under the pretense that they are made by "pauper labor," freely admits the "pauper laborer" himself?

The incoming of the products of cheap labor is a very different thing from the incoming of cheap labor. The effect of the one is upon the production of wealth, increasing the aggregate amount to be distributed; the effect of the other is upon the distribution of wealth, decreasing the proportion which goes to the working classes.
We might permit the free importation of Chinese commodities without in the slightest degree affecting wages; but, under our present conditions, the free immigration of Chinese laborers would lessen wages.

Let us imagine under the general conditions of modern civilization, one country of comparatively high wages, and another country of comparatively low wages. Let us, in imagination, bring these countries side by side, separating them only by a wall which permits the free transmission of commodities, but is impassable for human beings. Can we imagine, as protectionist notions require, that the high wage country would do all the importing and the low wage country all the exporting, until the demand for labor so lessened in the one country that wages would fall to the level of the other? That would be to imagine that the former country would go on pushing its commodities through this wall and getting back nothing in return. Clearly the one country would export no more than it got a return for, and the other could import no more than it gave a return for. What would go on between the two countries is the exchange of their respective productions, and, as previously pointed out, what commodities passed each way in this exchange would be determined, not by the difference in wages between the two countries, nor yet by differences between them in cost of production, but by differences in each country in the comparative cost of producing different things. This exchange of commodities would go on to the mutual advantage of both countries, increasing the amount which each obtained, but no matter to what dimensions it grew, how could it lessen the demand for labor or have any effect in reducing wages?

Now let us change the supposition and imagine such a barrier between the two countries as would prevent the passage of commodities, while permitting the free passage of men. No goods produced by the lower-paid labor of the one country could now be brought into the other; but would this prevent the reduction of wages? Manifestly not. Employers in the higher wage country, being enabled to get in laborers willing to work for less, could quickly lower wages.

What we may thus see by aid of the imagination accords with what we do see as a matter of fact. In spite of the high duties which shut out commodities on the pretense of protecting American labor, American workmen in all trades are being forced into combinations to protect themselves by checking the competition of the labor market. Our protective tariff on commodities raises the price of commodities, but what raising there is of wages has been accomplished by trades-union and the Knights of Labor. Break up these organizations and what would the tariff do to prevent the forcing down of wages in all the now organized trades?

A scheme really intended for the protection of working-men from the competition of cheap labor would not merely prohibit the importation of cheap labor under contract, but would prohibit the landing of any laborer who had not sufficient means to raise him above the necessity of competing for wages, or who did not give bonds to join some trades-union and abide by its rules. And if, under such a scheme, any duties on commodities were imposed, they would be imposed, in preference, on such commodities as could be produced with small capital, not on those which require large capital—that is to say, the effort would be to protect industries in which workmen can readily engage on their own account, rather than those in which the mere workman can never hope to become his own employer.
Our tariff, like all protective tariffs, aims at nothing of this kind. It shields the employing producer from competition, but in no way attempts to lessen competition among those who must sell him their labor; and the industries it aims to protect are those in which the mere workman, or even the workman with a small capital, is helpless—those which cannot be carried on without large establishments, costly machinery, great amounts of capital, or the ownership of natural opportunities which bear a high price.

It is manifest that the aim of protection is to lessen competition in the selling of commodities, not in the selling of labor. In no case, save in the peculiar and exceptional cases I shall hereafter speak of, can a tariff on commodities benefit those who have labor, not commodities, to sell. Nor is there in our tariff any provision that aims at compelling such employers as it benefits to share their benefits with their workmen. While it gives these employers protection in the goods market it leaves them free trade in the labor market, and for any protection they need workmen have to organize.
I am not saying that any tariff could raise wages. I am merely pointing out that in our protective tariff there is no attempt, however inefficient, to do this—that the whole aim and spirit of protection is not the protection of the sellers of labor but the protection of the buyers of labor, not the maintaining of wages but the maintaining of profits. The very class that profess anxiety to protect American labor by raising the price of what they themselves have to sell, notoriously buy labor as cheap as they can and fiercely oppose any combination of workmen to raise wages. The cry of "protection for American labor" comes most vociferously from newspapers that lie under the ban of the printers' unions; from coal and iron lords who, importing "pauper labor" by wholesale, have bitterly fought every effort of their men to claim anything like decent wages; and from factory owners who claim the right to dictate the votes of men. The whole spirit of protection is against the rights of labor.

This is so obvious as hardly to need illustration, but there is a case in which it is so clearly to be seen as to tempt me to reference.

There is one kind of labor in which capital has no advantage, and that a kind which has been held from remote antiquity to redound to the true greatness and glory of a country—the labor of the author, a species of labor hard in itself, requiring long preparation, and in the vast majority of cases extremely meager in its pecuniary returns. What protection have the protectionist majorities that have so long held sway in Congress given to this kind of labor? While the American manufacturer of books—the employing capitalist who puts them on the market—has been carefully protected from the competition of foreign manufacturers, the American author has not only not been protected from the competition of foreign authors, but has been exposed to the competition of labor for which nothing whatever is paid. He has never asked for any protection save that of common justice, but this has been steadily refused. Foreign-made books have been saddled with a high protective duty, a force of customs examiners is maintained in the post-office, and an American is not even allowed to accept the present of a book from a friend abroad without paying a tax for it. But this is not to protect the American author, who as an author is a mere laborer, but protect the American publisher, who is a capitalist. And this capitalist, so carefully protected as to what he has to sell, has been permitted to compel the American author to compete with stolen labor. Congress, which year after year has been maintaining a heavy tariff, on the hypocritical plea of protecting American labor, has steadily refused the bare justice of acceding to an international copyright which would prevent American publishers from stealing the work of foreign authors, and enable American authors not only to meet foreign authors on fair terms at home, but to get payment for their books when reprinted in foreign countries. An international copyright, demanded as it is by honor, by morals and by every dictate of patriotic policy, has always been opposed by the protective interest. Could anything more clearly show that the real motive of protection is always the profit of the employing capitalist, never the benefit of labor?

What would be thought of the Congressman who should propose, as a "working-man's measure," to divide the surplus in the treasury between two or three railway kings, and who should gravely argue that to do this would be to raise wages in all occupations, since the railway kings, finding themselves so much richer, would at once raise the wages of their employees; which would lead to the raising of wages on all railways, and this again to the raising of wages in all occupations? Yet the contention that protective duties on goods raise wages involves just such assumptions.

It is claimed that protection raises the wages of labor—that is to say, of labor generally. It is not merely contended that it raises wages in the special industries protected by the tariff. That would be to confess that the benefits of protection are distributed with partiality, a thing which its advocates are ever anxious to deny. It is always assumed by protectionists that the benefits of protection are felt in all industries, and even the wages of farm laborers (in an industry which in the United States is not and cannot be protected by the tariff) are pointed to as showing the results of protection.

The scheme of protection is, by checking importation to increase the price of protected commodities so as to enable the home producers of these commodities to make larger profits. It is only as it does this, and so long as it does this, that protection can have any encouraging effect at all, and whatever effect it has upon wages must be derived from this.

I have already shown that protection cannot, except temporarily, increase the profits of producers as producers, but without regard to this it is clear that the contention that protection raises wages involves two assumptions: (1) that increase in the profits of employers means increase in the wages of their workmen; and (2) that increase of wages in the protected occupations involves increase of wages in all occupations.

To state these assumptions is to show their absurdity.
It there anyone who really supposes that because an employer makes larger profits he therefore pays higher wages?

I rode not long since on the platform of a Brooklyn horse-car and talked with the driver. He told me, bitterly and despairingly, of his long hours, hard work and poor pay—how he was chained to that car, a verier slave than the horses he drove; and how by turning himself into this kind of a horse-driving machine he could barely keep wife and children, laying by nothing for a "rainy day."

I said to him, "Would it not be a good thing if the Legislature were to pass a law allowing the companies to raise the fare from five to six cents, so as to enable them to raise the wages of their drivers and conductors?"

The driver measured me with a quick glance, and then exclaimed: "They give us more, because they made more! You might raise the fare to six cents or to sixty cents, and they would not pay us a penny more. No matter how much they made, we would get no more, so long as there are hundreds of men waiting and anxious to take our places. The company would pay higher dividends or water the stock; not raise our pay."
Was not the driver right? Buyers of labor, like buyers of other things, pay, not according to what they can, but according to what they must.
There are occasional exceptions, it is true; but these exceptions are referable to motives of benevolence, which the shrewd business man keeps out of his business, no matter how much he may otherwise indulge them. Whether you raise the profits of a horse-car company or of a manufacturer, neither will on that account pay any higher wages. Employers never give the increase of their profits as a reason for raising the wages of their work-men, though they frequently assign decreased profits as a reason for reducing wages. But this is an excuse, not a reason. The true reason is that the dull times which diminish their profits increase the competition of work-men for employment. Such excuses are given only when employers feel that if they reduce wages their employees will be compelled to submit to the reduction, since others will be glad to step into their places. And where trades-unions succeed in checking this competition they are enabled to raise wages. Since my talk with the driver, the horse-car employees of New York and Brooklyn, organized into assemblies of the Knights of Labor and supported by that association, have succeeded in somewhat raising their pay and shortening their hours, thus gaining what no increase in the profits of the companies would have had the slightest tendency to give them.

No matter how much a protective duty may increase the profits of employers, it will have no effect in raising wages unless it so acts upon competition as to give workmen power to compel an increase of wages.

There are cases in which a protective duty may have this effect, but only to a small extent and for a short time. When a duty, by increasing the demand for a certain domestic production, suddenly increases the demand for a certain kind of skilled labor, the wages of such labor may be temporarily increased, to an extent and for a time determined by the difficulties of obtaining skilled laborers from other countries or of the acquirement by new laborers of the needed skill.

But in any industry it is only the few workmen of peculiar skill who can thus be affected, and even when by these few such an advantage is gained, it can only be maintained by trades-unions that limit entrance to the craft. The cases are, I think, few indeed in which any increase of wages has thus been gained by even that small class of workmen who in any protected industry require such exceptional skill that their ranks cannot easily be swelled; and the cases are fewer still, if they exist at all, in which the difficulties of bringing workmen from abroad, or of teaching new workmen, have long sufficed to maintain such increase. As for the great mass of those engaged in the protected industries, their labor can hardly be called skilled. Much of it can be performed by ordinary unskilled laborers, and much of it does not even need the physical strength of the adult man, but consists of the mere tending of machinery, or of manipulations which can be learned by boys and girls in a few weeks, a few days, or even a few hours. As to all this labor, which constitutes by far the greater part of the labor required in the industries we most carefully protect, any temporary effect which a tariff might have to increase wages in the way pointed out would be so quickly lost that it could hardly be said to come into operation. For an increase in the wages of such occupations would at once be counteracted by the flow of labor from other occupations. And it must be remembered that the effect of "encouraging" any industry by taxation is necessarily to discourage other industries, and thus to force labor into the protected industries by driving it out of others.

Nor could wages be raised if the bounty which the tariff aims to give employing producers were given directly to their workmen. If, instead of laws intended to add to the profits of the employing producers in certain industries, we were to make laws by which so much should be added to the wages of the workmen, the increased competition which the bounty would cause would soon bring wages plus the bounty to the rate at which wages stood without the bounty. The result would be what it was in England when, during the early part of this century, it was attempted to improve the miserable condition of agricultural laborers by "grants in aid of wages" from parish rates. Just as these grants were made, so did the wages paid by the farmers sink.

The car-driver was right. Nothing could raise his wages that did not lessen the competition of those who stood ready to take his place for the wages he was getting. If we were to enact that every car-driver should be paid a dollar a day additional from public funds, the result would simply be that the men who are anxious to get places as car-drivers for the wages now paid would be as anxious to get them at one dollar less. If we were to give every car-driver two dollars a day, the companies would be able to get men without paying them anything, just as where restaurant waiters are customarily feed by the patrons, they get little or no wages, and in some cases even pay a bonus for their places.

But if it be preposterous to imagine that any effect a tariff may have to raise profits in the protected industries can raise wages in those industries, what shall we say of the notion that such raising of wages in the protected industries would raise wages in all industries? This is like saying that to dam the Hudson River would raise the level of New York Harbor and consequently that of the Atlantic Ocean. Wages, like water, tend to a level, and unless raised in the lowest and widest occupations can be raised in any particular occupation only as it is walled from competition.

The general rate of wages in every country is manifestly determined by the rate in the occupations which require least special skill, and to which the man who has nothing but his labor most easily resort. As they engage the greater body of labor these occupations constitute the base of the industrial organization, and are to other occupations what the ocean is to its bays. The rate of wages in the higher occupations can be raised above the rate prevailing in the lower, only as the higher occupations are shut off from the inflow of labor by their greater risk or uncertainty, by their requirement of superior skill, education or natural ability, or by restrictions such as those imposed by trades-unions. And to secure anything like a general rise of wages, or even to secure a rise of wages in any occupation upon ingress to which restrictions are not at the same time placed, it is necessary to raise wages in the lower and wider occupations. That is to say, to return to our former illustration, the level of the bays and harbors that open into it cannot be raised until the level of the ocean is raised.

If it were evident in no other way, the recognition of this general principle would suffice to make it clear that duties on imports can never raise the general rate of wages. For import duties can only "protect" occupations in which there is not sufficient labor employed to produce the supply we need. The labor thus engaged can never be more than a fraction of the labor engaged in producing commodities of which we not only provide the home supply but have a surplus for export, and the labor engaged in work that must be done on the spot.

No matter what the shape or size of an iceberg, the mass above the water must be very much less than the mass below the water. So no matter what be the conditions of a country or what the peculiarities of its industry, that part of its labor engaged in occupations that can be "protected" by import duties must always be small as compared with that engaged in occupations that cannot be protected. In the United States, where protection has been carried to the utmost, the census returns show that not more than one-twentieth of the labor of the country is engaged in protected industries.

In the United States, as in the world at large, the lowest and widest occupations are those in which men apply their labor directly to nature, and of these agriculture is the most important. How quickly the rise of wages in these occupations will increase wages in all occupations was shown in the early days of California, as afterward in Australia. Had anything happened in California to increase the demand for cooks or carpenters or painters, the rise in such wages would have been quickly met by the inflow of labor from other occupations, and in this way retarded and finally neutralized. But the discovery of the placer mines, which greatly raised the wages of unskilled labor, raised wages in all occupations.

The difference of wages between the United States and European countries is itself an illustration of this principle. During our colonial days, before we had any protective tariff, ordinary wages were higher here than in Europe. The reason is clear. Land being easy to obtain, the laborer could readily employ himself, and wages in agriculture being thus maintained at a higher level, the general rate of wages was higher. And since up to the present time it has been easier to obtain land here than in Europe, the higher rate of wages in agriculture has kept up a higher general rate.

To raise the general rate of wages in the United States the wages of agricultural labor must be raised. But our tariff does not and cannot raise even the price of agricultural produce, of which we are exporters, not importers. Yet, even had we as dense a population in proportion to our available land as Great Britain, and were we, like her, importers not exporters or agricultural productions, a protective tariff upon such productions could not increase agricultural wages, still less could it increase wages in other occupations, which would then have become the widest. This we may see by the effect of the corn laws in Great Britain, which was to increase, not the wages of the agricultural laborer, nor even the profits of the farmer, but the rent of the agricultural landlord. And even if the differentiation between landowner, farmer and laborer had, under the conditions I speak of, not become as clear here as in Great Britain, nothing which benefited the farmer would have the slightest tendency to raise wages, save as it benefited him, not as an owner of land or an owner of capital, but as a laborer.

We thus see from theory that protection cannot raise wages. That it does not, facts show conclusively. This has been seen in Spain, in France, in Mexico, in England during protection times, and everywhere that protection has been tried. In countries where the working classes have little or no influence upon government it is never even pretended that protection raises wages. It is only in countries like the United States, where it is necessary to cajole the working class, that such a preposterous plea is made. And here the failure of protection to raise wages is shown by the most evident facts.

Wages in the United States are higher than in other countries, not because of protection, but because we have had much vacant land to overrun. Before we had any tariff, wages were higher here than in Europe, and far higher, relatively to the productiveness of labor, than they are now after our years of protection.
In spite of all our protection—and, for the last twenty-four years at least, protectionists have had it all their own way—the condition of the laboring classes of the United States has been slowly but steadily sinking to that of the "pauper labor" of Europe. It does not follow that this is because of protection, but it is certain that protection has proved powerless to prevent it.

To discover whether protection has or has not benefited the working classes of the United States it is not necessary to array tables of figures which only an expert can verify and examine. The determining facts are notorious. It is a matter of common knowledge that those to whom we have given power to tax the American people "for the protection of American industry," pay their employees as little as they can, and make no scruple of importing the very foreign labor against whose products the tariff is maintained. It is notorious that wages in the protected industries are, if anything, lower than in the unprotected industries, and that, though the protected industries do not employ more than a twentieth of the working population of the United States, there occur in them more strikes, more lock outs, more attempts to reduce wages, than in all other industries. In the highly protected industries of Massachusetts, official reports declare that the operative cannot get a living without the work of wife and children. In the highly protected industries of New Jersey, many of the "protected" laborers are children whose parents are driven by their necessities to find employment for them by misrepresenting their age so as to evade the State law. In the highly protected industries of Pennsylvania, laborers, for whose sake we are told this high protection is imposed, are working for sixty-five cents a day, and half-clad women are feeding furnace fires. "Pluck-me stores," company tenements and boarding-houses, Pinkerton detectives and mercenaries, and all the forms and evidences of the oppression and degradation of labor are, throughout the country, characteristic of the protected industries.

The greater degradation and unrest of labor in the protected than in the unprotected industries may in part be accounted for by the fact that the protected employers have been the largest importers of "foreign pauper labor." But, in some part, at least, it is due to the greater fluctuations to which the protected industries are exposed. Being shut off from foreign markets, scarcity of their productions cannot be so quickly met by importation, nor surplus relieved by exportation, and so with them for much of the time it is either "a feast or a famine." These violent fluctuations tend to bring workmen into a state of dependence, if not of actual peonage, and to depress wages below the general standard. But whatever be the reason, the fact is that so far is protection from raising wages in the protected industries, that the capitalists who carry them on would soon "enjoy" even lower priced labor than now, were it not that wages in them are kept up by the rate of wages in the unprotected industries.
« Last Edit: November 08, 2010, 11:20:10 am by Geolibertarian » Report Spam   Logged

"For the first years of [Ludwig von] Mises’s life in the United States...he was almost totally dependent on annual research grants from the Rockefeller Foundation.” -- Richard M. Ebeling
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