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amounts to.

standard of wages. Increased wages imply
increased capital, increased interest, in-
creased cost of production, and so back
again to increased wages.
This process
continues until capital commands 10 per
cent. interest where it formerly received 7,
and an average duty of 50 per cent. on all
imported articles that pay duty at all, is ac-
knowledged both by free-traders and pro-
tectionists to be no longer protective.

sponsible man may contract in Montreal or Liverpool for the delivery of smuggled goods in New York. This is the last report of the Commissioner of Customs, the third Commission we have to cite as to abuses on the revenue service. Mr. Wells states that the number of duty-paid foreign cigars, which in 1859 was reported at about 800,000,000 per annum was reduced in 1867 to 30,000,000 under a duty of 150 per cent. ad valorem, although the actual In all this operation there is no new princonsumption is supposed to have increased. ciple involved, and if all political economy So too with champagne, opium, and many is not a deception, the ultimate pressure other dutiable articles. The consumer must sooner or later fall upon labour. The probably saves a certain amount by paying profits of capital are not diminished, and it tax to the smuggler rather than to the Gov- is not likely that in a country like America ernment, but the burden must be borne, the demand for capital can be permanently and the cost of production in the United checked. But the tendency of the system States must ultimately tell what the burden is to increase the wealth of individuals and corporations at a more rapid rate than the Finally, the capitalist collects a fourth wealth of the public at large. Capital actax. Every influence, whether we call it cumulates rapidly, but it accumulates in tax or not, which increases the cost of pro- fewer hands, and the range of separation duction, increases immediately the amount between the wealthy and the poor becomes of capital required to produce the same continually wider. Mr. Wells, in his last result as before. In the United States cap- Report, has collected a great amount of ital has always been deficient, and 7 per evidence to prove that the burden has in cent. per annum even before the war was a fact fallen upon wages, as was to be inferred moderate return for its use. Government from à priori reasoning, and that the purthen intervened as a borrower, and has chasing power of a day's labour in 1868 is practically fixed the minimum of interest considerably less than it was in 1860. But at between 7 and 8 per cent. This system hitherto the stress of suffering has fallen of taxation compels every employer of cap-most severely on the intermediate class, ital to use a larger amount in his business than would be required if the system were reformed. The borrower, therefore, is compelled to increase the competition for capital, and to pay higher interest on a larger sum, with the understanding that his industry must perish unless he can compel the consumer to pay not only the additional interest but also a certain additional profit in consideration of the increased risk incurred on the increased capital. Nor is this all. The currency is a discredited and fluctuating medium of exchange, and the capitalist charges his increased risk on this score also to the borrower, who must necessarily throw off the double risk again on the consumer. Government then intervenes and taxes the capitalist on his increased profits in order to escape taxing labour, and the capitalist quietly counts the increased tax as so much additional expense, and throws it off upon the borrower, who must either throw it on the consumer or become bankrupt.

The Government seizes, let us say, 20,000,0007. from the public, and gives it to certain favoured citizens who spend a considerable portion of it in hiring labour, creating an artificial demand, and raising the

whose incomes were, to a greater or less extent, fixed. The ordinary expenses of life have nearly doubled in eight years, but in many cases incomes are not greater in paper than they were in 1860 in coin. All liberal professions have felt the shock. The Universities with their instructors were reduced to a pitiable condition. The clergy of all sects found themselves struggling with poverty hitherto unknown. The great mass of lawyers and the bench suffered a similar degradation.

Science and literature languished. The United States Government in its western surveys could obtain the services of its botanists and zoologists at 107. a month in currency, while it paid 157. to the cook and mule-driver who accompanied them. We do not now speak of the inhabitants of great cities, nor of the few distinguished men whose incomes were swelled beyond the average, but of the population at large, especially in the rural districts of the older States, where changes went on in silence, and men, who in old times lived plentifully, now restricted their expenses, eat meat four times a week instead of every day, and said nothing of their economies. The public press seldom pauses to mark such changes as these. They lie under

neath the surface of society but they indicate disaster to the principle of social equality.

Agriculture, at least in the western States, did not suffer, partly because the introduction of machinery has neutralized the rise in wages, partly because the western farmer is little affected by taxation and almost independent of society; partly, too, because all the harvests except the last have been short, and high prices have been maintained. The natural increase of population keeps pace with the development of new lands which the Government practically gives for nothing to the settler. The West, therefore, exists under exceptional conditions. But in the main, it is true, as Mr. Wells has said, that the rich become richer and the poor poorer; nor is this fact in any way disproved by the corresponding fact that production increases with great rapidity. The system is corrupt, it is an outrage on common sense, it is extravagant beyond belief, it exalts fraud and ruins honesty; but the physical growth of the country is in itself so energetic that misgovernment can at best pervert, but not seriously check it. The labourer can bear a diminution in his wages. The mechanic may be forced to economize and yet live well as compared with his rivals in Europe. A mere failure to increase production so rapidly as it might be increased, is all that can be premeditated; a mere retardation, not a stoppage, of national prosperity. But in the meanwhile all articles of export rise in price until foreign nations will no longer buy, and the country can only send gold and certificates of debt

abroad to pay for purchases which no tan f nor law can stop.

We will not undertake to predict how long this process can last. If its results please the American people, England will not complain, for she will not be the principal sufferer in this drunken bout. Foreign nations, carrying out a selfish political policy, will probably find it to their interest that the United States should continue to produce for herself only, and pay her enormous imports in notes bearing practically 8 per cent. interest, the return of which in any large quantity would damage her credit and disorganize her trade; that she should elevate the scale of social expenditure, and at the same moment depress the standard of the working class; that she should build up an oligarchy resting on corporate and private wealth, and prepare the way for that corruption which, in its own time, will overthrow her institutions. The great responsibility of the new Administration is to itself and not to the world. The best Americans are looking to it with the deepest anxiety, to save the country so far as possible from its dangers by effecting a reform the principles of which we have pointed out; but if the hope is disappointed, even though the country should go on increasing its wealth and power more rapidly than ever, the world will have a right to believe that neither the skill of the Government nor the virtue of American institutions has had any share in the result, except so far as the nation is receiving and exhausting advantages left to it by a past and purer generation.

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much less trepidation, what they did at last in the case of the rams, - namely, strain very decidedly a legal point to preMR. SUMNER has expounded in the Sen- vent a breach of international comity. No ate of the United States his conception of sensible person will doubt that it was the the reasons which rendered the late Con- insane enthusiasm of our aristocracy and vention negotiated between Lord Clarendon bourgeoisie for the most detestable of causes and Mr. Reverdy Johnson totally unsatis- which really supplied the Southern rebelfactory as a mode of settling the liabilities lion with money, ships, arms, and good known popularly as the Alabama claims. wishes, and daunted our Government in its His speech is, from what we cannot but rather hesitating and tremulous attempt to regard as his very singular point of view, preserve a friendly attitude towards the temperate, dignified, and not wanting in Government of the United States. So statesmanlike grasp of the importance of much we admit without difficulty to Mr. the emergency. What astonishes us is not Sumner. Nay, we go further, and say that the sentiment of his speech, which is manly, had their case been ours, - had the upper natural, and patriotic, nor in any consid- crust of the United States expressed its erable degree its practical counsel (to reject hearty sympathy with an Irish rebellion, the Convention), which we can at least raised a loan for it, and sent out privateers fully understand; but the extraordinary under an Irish flag to scour the seas in mixture of strictly sentimental with strictly search of British commerce we should in legal considerations which pervades it all probability have declared war with the throughout. If he had simply said that he, United States, or if deterred from that like the great majority of American states- course by a mere prudent calculation of men, considers the circumstances leading consequences, still have been thoroughly to the fitting-out and escape of the Alabama disinclined to condone the offence and and of many of her consorts less from any resume cordial international relations with legal point of view than as a symptom of the United States, without extracting from the deliberate unfriendliness of a great part their Government something more than a of the British people, and, as a consequence, dry contract to refer the legal claims of though in a less degree, of the British injured individuals to arbitration. Government, towards the Northern States But while we admit all this to Mr. Sumduring the Civil War; - that this unfriend- ner, we confess that it seems to go a very liness was of a character which might well little way towards explaining his speech. have led to war then, and which may still One Government may fairly say to another, lead, if not to war, to greedy reprisals on The moral damage which your people England should we ever be in circumstances have inflicted upon us, and to which you to suffer equally severely from a similar have been more or less a party, touches our policy on the part of the United States, honour so vitally, goes so far beyond any and that this source of bitterness cannot be infraction of law of which we can comremoved without a frank apology and ex- plain, that we decline to enter into a conpression of regret from England for what vention which implies that it is in any sense has happened, if this, we say, had been á question of damages. You might as well the drift of Mr. Sumner's speech, we should ask a man of sensitive honour to accept have been disposed to agree with him very damages as reparation for an unretracted heartily. It is perfectly true that we must insult.' Such a line as that is quite intelliascribe to the favour with which the South-gible. But it is not intelligible to say, ern cause was looked upon by an influen- what, in effect, Mr. Sumner does, tial portion of the English people, that is, of the aristocracy and the middle-class, the confidence with which the South applied to us for their loan, and for the ships and ammunitions of war in which they invested that loan. Had their cause been one as hateful to England as that of Ferdinand of Naples, they would have got little help and no open sympathy: our most respectable" shipbuilders would not have undertaken to build their ships, and if by chance any one of them had done so, our Government would have been supported by public opinion in doing much earlier, and with

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ground our claims on a number of extremely questionable and insecure, not to say unsubstantial, legal considerations, which we expect you to admit, not on legal grounds, but as a mode of making moral compensation to us for entirely extra-legal blunders and sins.' That seems to us simply unbusiness-like and wholly untenable. So far as the United States make legal claims, let us treat them as legal claims in the strictest sense of the word. And for claims of that kind, what can we propose fairer than arbitration by an impartial tribunal? But so far as the United States complain of our

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moral attitude, which they have every | we should preface its decision by language reason to do, —- let us deal with that quite equivalent to an admission that we separately, not affect to mix it up with in the wrong. To plead guilty before the legal claims, but either settle it, or leave it Court first, and then defend our innocence, unsettled, if we cannot settle it, without is the strangest recommendation ever yet prejudice to those claims. made to an accused person. Yet, as far as The only pretence which Mr. Sumner we understand Mr. Sumner, that is what seems to us to have for his very remark- he kindly proposes for England; -unless, able mode of mixing up the unfriendly ani- indeed, he really means that we are not enmus of our people and press with the legal titled even to submit the legality of our claims which, if they are tenable, may have conduct to arbitration at all, but only the been more or less due to that unfriendly amount of the penalty. We agree with Mr. animus as their fostering source, is that he Sumner that the tone of the English Parliahas discovered two cases in which a con- ment and the uppermost stratum of the vention, concluded expressly to determine English people in the beginning of the the exact extent of the reparation we pro- Civil War was in the highest degree unposed to make, was preceded by a general friendly to the United States. But we do apology on the part of the English Govern- not happen to agree with him that there ment for the wrong we had done. But was any clear breach of legal neutrality then, in both these cases the wrong we had committed from beginning to end of the done was an undoubted and undeniable war, though we do believe that there was legal wrong, which we admitted at the out-sufficient negligence in allowing the escape set, indeed, could not deny, and there- of the Alabama to make that matter a fair fore, of course, never proposed to submit case for arbitration. Moreover, we do not on its merits to the arbitration of any trib- suppose that there is a single eminent unal. It would have been simply impossi- statesman (not even Mr. Bright) or lawyer ble, when we had, by our own admission, in England who would go further than we committed a grave breach of international do in Mr. Sumner's direction, and law, to begin our reparation otherwise than who would go so far. Now, what is it, by expressing our regret. When the then, which Mr. Sumner calmly proposes British frigate Leopard boarded the United to us all, even those who, like ourselves, States' frigate Chesapeake to regain posses- approach him most closely in political bias? sion of the persons of four British subjects Simply this; to submit our political and said to be impressed there, the act was so legal consciences in the most abject manner monstrous a breach of international law, to a dogma which not a single man amongst that when the matter was settled, it was us worth a moment's consideration holds to settled by disavowal, by restitution, and by be true, to confess a legal guilt of which compensation; and, of course, a solution we are entirely unconscious, and this as a by which Great Britain acknowledged her- condition sine quâ non of reconciliation self wholly in the wrong was necessarily with the United States. Was anything so preceded by apology. So, too, of the in- monstrous ever proposed on this earth becursion across the Canadian border into the fore by any man taking the rank of a statesUnited States in 1837; - the obvious criti-man? He does not ask us to express popcism on that matter being not Mr. Sum-ular regret for a grave political error, ner's, one of satisfaction that we apologized and, as we think, even sin, at last, but one of wonder that the apology, so obviously required, was so long delayed. There was in that affair a real defiance of the independent authority of a peaceful and friendly state, and of course the first condition of reconciliation was to express regret that our people had been betrayed into so indefensible an act. But Mr. Sumner fails to see that in the present case the whole question at issue is simply this, whether we did in any respect whatever violate the slightest rule of international law by our proceedings in the Alabama case? That is the very point to be decided. If it is to be decided by the only fair method in the case of any international dispute, equitable arbitration, it is monstrous to propose that

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for which the people at large were not responsible, though the most influential of them were,

but to begin by a frank admission of legal culpability, and this on one of the most important of all points of international law, which might be turned against us tomorrow, in a case where all our sympathies, and all American sympathies too, might happen to be just the other way. He wants us to make an insincere admission, which, by the bye, if it were of any legal value as a precedent at all, would in all probability be first quoted by Spain in support of a peremptory demand for apology from the United States for the advice which the House of Representatives has tendered to the President in relation to

Cuba, on grounds infinitely less plausible. Mr. Sumner seems to us, we confess, to be confounding legal considerations of the first importance with totally distinct moral considerations in a manner almost childish, when he makes a preliminary apology by England the first condition of a convention, the sole object of which is to settle whether or not there is the vestige of a ground for asserting that any breach of law has been committed. If he supposes that a nation which heartily believes itself guiltless of a breach of law, even though on one point it may see that there is a fair opening for doubt and discussion, is likely to declare itself guilty simply to conciliate an opponent, he is more sanguine and credulous, or more disposed to believe in English cowardice, than we should have thought possible.

we should have proceeded, in violation of that municipal law, to stop vessels accused of being intended for Southern privateers, on wholly inadequate and inadmissible evidence which no judge or jury would have listened to for a moment. In short, Mr. Sumner's legal argument is a very poor ex parte statement of the United States' case, without even a pretence of a judicial discussion. But be that as it may, it is too obvious that ex parte legal arguments, if they were the best in the world, are not reasons why judgment should go for the pleader without ever hearing the case on the other side. Mr. Sumner has nothing to say which has not been heard a hundred times before, though he suppresses a great deal which has also been heard a hundred times before, and which seems to us of much greater weight. But what he does say, instead of being put forward as proof that there is something to discuss, for which only it would serve, is unfortunately put forward as proof that there is nothing to discuss, which it not only does not prove, but disproves.

As regards Mr. Sumner's argument to prove that we were guilty of a breach of international right, that we did violate the laws of neutrality in our policy towards the South, we need not say much. Some things he said which are fair arguments to lay befor an arbitrator; others he said which On the whole, Mr. Sumner's speech imseemed to us coloured by prejudices and presses us very deeply with the necessity prepossessions so extraordinary, that we there is for greater candour on both sides of read them twice before we could credit him the Atlantic. Those who feel keenly as we with having made any statement so mon- do the moral strength of Mr. Sumner's case strous, (such, for instance, as the asser- against England, ought to favour every option that the fitting-out of the Alabama was portunity for informally expressing that keen as much the fitting-out of a hostile expedi- sense of regret and mortification which we tion 66 as if she had sailed forth from Her heartily believe that the great majority of Majesty's dockyard "); but the great feature the people of Great Britain and Ireland enof his speech is that in treating the legal tertain with regard to the conduct of the questions he does not even condescend to ruling class and the Government during the grapple with any one of the more powerful first four years of the Civil War. Those, considerations which tell against him. He on the other hand, in America who feel ignores the point that the acknowledgment with corresponding keenness the utter unof the fact of belligerency at sea was essen- reasonableness of such assumptions as Mr. tial to give the United States the power of Sumner's, that England committed in blockade in the sense in which they wanted this case a conspicuous breach of internaand used it, namely, to stop vessels on tional law like the boarding of the Chesathe high seas bound to any blockaded port. peake, or the raid of 1837 into the territory He ignores the fact that the friends of the of the United States, - should do their best North felt this so strongly that some of to restrain such unreasonable and self-conthem urged the recognition of belligerency tradictory demands as Mr. Sumner's, which and proclamation of neutrality on the British seem contrary to all the most obvious princiGovernment, in the interests of the North ples of law. Of course, if we are decided to alone. He ignores altogether the question whether the breach of any municipal law like our Foreign Enlistment Act can be rightly made matter of international complaint by a foreign government. He is inconsistent, too, with himself; for while he makes it (not unjustly, as we think) a great charge against us that we were so negligent in executing our own municipal law, in the Alabama case, a great part of his accusations rest on the assumption that


have been guilty of a breach of international law, let us by all means apologize ; but to assume the very point in the discussion, on the ground that we have certainly been guilty of ill-feeling, is as monstrous as it would be for us to ground our own defence on the plea that America has sympathized openly with the Fenian conspirators. Informal national sins must be expiated, if at all, by informal national expressions of regret. We do not ask the Government of the United

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