in a few cases, where some protective influence was felt along the Canadian border. Nevertheless, agriculture was thus incorporated into the protective system.1

Grover Cleveland (see) led in a campaign for free or less heavily burdened raw materials (see), including some agricultural products, but his efforts were only partially successful.

The tariff act of 1897 reimposed duties on wool, which had been free under the act of 1894, and advanced a number of the rates on other agricultural products. (See table below.) The duties on wool were maintained in the tariff revision of 1909. (See WOOL; also United States Tariff Commission, The Wool Growing Industry, 1921, pp. 416-436.) The agricultural schedule of this act did not differ greatly from that of 1897.

The principal features affecting agriculture in the tariff of 1913 were the placing on the free list of wool, sugar (effective after three years), wheat, cattle, flour, meats, eggs, milk, and cream. (See also below.)

Emergency tariff (1921).—“With a view to arrest ing the steep post-war decline in the prices of agricultural products, the emergency tariff levied substantially increased duties upon about 40 agricultural commodities, and added compensatory duties upon cotton and woolen manufactures to offset the duties upon long-staple cotton and wool. This list included nearly all of the great staples of American agriculture, such as wheat, corn, cattle, sheep, meats of all kinds, wool, dairy products, vegetable oils, apples, and a number of minor but locally important crops such as olives, cherries, wrapper tobacco, and onions.

The higher rates took effect in the midst of a tremendous and world-wide price deflation, particularly acute in agricultural products. Heavy war stocks in the European markets, to which most of the foreign products ordinarily moved, along with European trade restrictions and currency depreciation, directed to the free markets of the United States a considerable volume of imports whose influence was more keenly felt because of the virtual absence during the World War of even the former competition. But it is significant that both the decline and later partial recovery in prices affected virtually all agricultural products, whether or not on the emergency list; it even affected products in which there was no foreign competition. Moreover, a similar and synchronous price depression occurred in other countries, and in the prices of imports of a kind not produced in the United States.

"The deflation, being world-wide in scope and created by world conditions, could not entirely be arrested by higher import duties. But in the case of commodities (such as wool, sugar, live cattle, lemons, olive oil, long-staple cotton), which faced some measure of actual or potential competition from imports, the duties doubtless exerted a stabilizing influence by raising the cost of competing imports. Moreover, they served to give some measure of confidence to domestic business. Upon the prices of products which we export, however, it is obvious that the tariff could exert slight beneficial influence. In fact, by reducing the purchasing power of foreign buyers, it may have tended to lower prices of products included in the emergency tariff, such as pork, cottonseed oil, apples, milk .products, cheese, winter wheats, and flours, of which this country is a heavy exporter. The act,

1 Stanwood, Edward, American Tariff Controversies, Boston, 1903, pp. 263-266.

it should furthermore be noted, was hastily drawn and contained defects which permitted evasions of the law, and which in several instances worked hardships upon domestic industries, notably the linseed-oil industry and to a slight extent the trade in wheat flour." 2

The tariff act of 1922 continued the policy of the emergency tariff of 1921. Many new classifications, necessitated by the development of the import trade, were added, and unimportant classifications were eliminated. The paragraphs were also reframed, with a view to affording more detailed information concerning imports.

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Analysis of schedule 7 (agricultural products and provisions) shows that this revised and expanded schedule contains approximately 320 tariff classifications. Approximately 93 of these classifications are transfers from the free list of the act of 1913 to the dutiable list of the new act. tually all of the remaining rates are higher than in the act of 1913, and in many cases higher than in 1909. Yet the level of rates in this schedule is probably lower than in an other dutiable schedule, and the great bulk of the rates is below 30 per cent ad valorem. It should be borne in mind also that in schedule 7 it was the general policy to impose specific rather than ad valorem rates; and because of the rise in price the higher specific rates do not represent proportionate increases when considered in relation to the higher price levels now prevalent. Among the transfers from the free list of the act of 1913 are the chief products of American agriculture, such as cattle, sheep, hogs, meats of all kinds, lard, tallow, eggs, milk and milk products, wheat and flour, corn, grass seeds, fruits in brine, potatoes, oil seeds. Fresh fish and many types of prepared fish, formerly free, are also made dutiable. Wool and vegetable oils are also transferred to the dutiable list of the textile and chemical schedules. Of the products in this schedule produced in the United States, the only important ones remaining upon the free list are hides and skins, cotton, bread, and broomcorn. Finally, of the products dutiable under both acts, the largest proportionate increases are made not in the great staples of American agriculture but in various manufactured specialties, such as cacao butter, tomato paste, canned mushrooms, and in lesser specialized crops, such as shelled almonds and walnuts, lemons, cherries, beans, peanuts, and olives.

"In conclusion, it may be noted that of the total number of classifications in the agricultural schedule only about 35 per cent consists of products of American farms and ranches. The remainder consists chiefly of manufactured products, such as meats and other packing-house products, flours, meals, and cereal products, canned and prepared fruits and vegetables, and many food specialties classable as provisions. A considerable number of the classifications consist of fresh and cured fish of many kinds, and also of commodities entirely, or almost entirely, produced abroad; spices, for instance, many kinds of seeds, and a number of items in the nursery and greenhouse schedules."

U. S. Tariff Commission, Sixth Annual Report, Washington, 1923, pp. 29, 30.

3 By a tariff classification is meant either a commodity, grade or preparation of a commodity, or group of commodities, classed together at a single rate in a tariff paragraph. The actual number of commodities is, of course, much greater, because a single basket or "catch-all" clause or classification sometimes embraces many products of minor importance. 4U. S. Tariff Commission, Sixth Annual Report, p. 33.

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Tariff rates on representative agricultural products under various United States tariff acts.' [See table at back of book for a more detailed comparison of acts of 1909, 1913, and 1922.]

17-N. O. P NOTE Cattle, wool, and sheep are not included in this table because of incomparabilty of the rates.

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the domestic wheat does not seem to have been appreciably affected by the duty. Soft wheats were not affected because of a difference in demand and because of a domestic exportable surplus. Pacific Coast wheats were not within the sphere of influence of Canadian imports for geographical reasons and the trade in hard winter wheats was not much affected because the United States is regularly on an export basis for this class. Almost the full effect of the duty, therefore, was concentrated upon northern spring varieties produced in the upper Mississippi and Missouri Valleys.

"Under conditions of free trade between the United States and Canada, Winnipeg prices of No. 1 Manitoba wheat normally exceeded the Minnesota price of No. 1 Northern Spring by 5 to 6 cents per bushel. After the passage of the emergency act, however, Minnesota prices gradually came to exceed Winnipeg prices by 25 to 27 cents per bushel. Therefore, after allowance is made for the higher quality of the Canadian wheat, it appears that the differential between the prices in the two markets is now almost equal to the duty."

Corn. Corn is a commodity of which the United States produces a large quantity for export. The emergency tariff imposed a duty thereon of 15 cents per bushel. The Argentine crop in 1921 was short, in consequence of which Argentine prices were at a level which would have prevented shipments to the United States even in the absence of a duty.

Rice. Rice was another commodity which, although exported in much larger quantities than it is imported, received considerable nominal protection by the emergency tariff. In spite of this fact the price in 1921 of New Orleans rice was about the same as that of standard qualities in London.

II. COMMODITIES OF WHICH THE UNITED STATES IMPORTS EXCEED EXPORTS.

Flaxseed-In the act of 1921 a duty of 30 cents per bushel was imposed upon flaxseed, an advance of 10 cents over the rate of 1913. In the five months preceding the passage of the emergency act the average price of flaxseed in Minneapolis was about 20 cents higher than the Canadian price. For the five corresponding months after the passage of the bill the average American price was about 30 cents higher than the Canadian price. Cattle and beef.-About 1912 the United States became in respect to beef and veal an importing rather than an exporting country. The position was reversed during the war, but since 1919 the tide seems to have turned again to the importing basis. By the emergency tariff, cattle (free under the tariff act of 1913) were subjected to a duty of 30 per cent ad valorem; fresh or frozen beef or veal to a duty of 2 cents per pound. A comparison of subsequent prices shows that in most cases the excess of the Chicago price over Canadian prices increased in June and July, 1921, by about the amount of the duty. Canadian prices followed the declining world market, while American prices steadied at a point considerably above the international level.

Prices of beef in Canada, London, and Buenos Aires averaged more than 20 per cent lower after June 1, 1921, than before, while prices in the United States averaged only 8 per cent lower. In other

1 When competing in the same market Canadian seed is quoted at higher prices than the American.

words, Canadian beef prices followed the world level, while American beef kept at a considerably higher level after June 1.

Cotton. The United States imports a considerable amount of long-staple cotton, upon which the emergency duty was 7 cents per pound. The principal variety imported is the so-called Sakellarides cotton of Egypt. Statistics show that the 7-cent duty increased the price of this variety of cotton in Boston by about the full amount of the duty as compared with Liverpool prices.

Wool. The emergency tariff transferred wool from the free to the dutiable list with a rate of from 15 to 45 cents a pound. "Boston prices of standard grades of scoured wool exceeded London prices of comparable grades by 10 to 25 cents per pound prior to the passage of the emergency act. In recent months (written July, 1922], however, the differential has increased, and it now stands from 25 to 35 cents per pound. As stocks of domestic wool are still further depleted, a closer approximation may be expected of the premium of Boston over London to the amount of the duty." (See PRICE).

Sugar.--The difference in price between Cuban sugar plus costs and freight to New York and dutypaid sugar averaged, before the emergency act, 1 cent per pound, and after, 1.6 cents per pound. These differences corresponded to the tariff rates of the act of 1913 and the emergency act of 1921.

Butter. The emergency act increased the duty from 24 cents per pound to 6 cents per pound. During the war unusual conditions put the country upon an exporting basis, a situation which was reversed in 1920. Two months after the passage of the emergency tariff it was found that "with but few exceptions the New York price was higher than the London price, the average margin being 4.3 cents."

Arguments for and Against Agricultural Tariffs. The following arguments are taken from the Nationalökonomie des Ackerbaues, by Wilhelm Roscher (1817-1894), one of the foremost economists of Germany, where the subject was thoroughly debated in the last decade of the nineteenth century.

Arguments for agricultural tariffs.

1. The greatest economic interest of the individual does not always coincide with the general economic interest of the State. It is the latter that should be the object of national economy. (See

PROTECTION.)

2. The interest of the national economy does not always coincide with that of world economy. The latter (through free trade) may aim toward the emigration from the nation of men and capital; the nation, however, in its own interest, must conserve these, if necessary, by tariff protection.

3. It is a mistake to encourage the existence of a large population dependent upon the export industry. The export market is always uncertain, and bound to contract as industry develops in foreign countries. The home market alone is dependable.

4. The agricultural population is the best source of able-bodied men both for the country's defense and for its industry. It should therefore be conserved, even at some expense.

5. Since the export industry must meet world competition, it is impossible to raise the standard of living of the population engaged therein far above the lower standards of competing nations. 6. It is likely that the increased expenses brought about by the tariff are in part paid by capital as

well as by the wage earner, and therefore the burden is probably distributed with equity.

7. The cost of the tariff should not be measured by the price difference between the domestic and the world market. The tariff may lower the world price as well as raise the domestic price. Often the foreign country bears part of the cus toms tax.

8. Increased and more intensive cultivation of the national territory does not always take place on the basis of diminishing returns (see). By the use of machines, fertilizers, and science, increasing returns may be obtained from the land. The tariff, therefore, by encouraging greater agricultural production, may promote its efficiency and cheap

ness.

9. Import duties upon agricultural products must frequently be regarded as "educational tariffs" for the protection of initial productive effort which will eventually be able to withstand world competition. Again, such protection may be necessary to ease the transition from one type of culti vation to another.

10. Agricultural production when properly carried on creates values without exhausting the natural resources; industry, on the other hand, in so far as it consumes the raw materials of a country, tends to exhaust the sources of national wealth; agriculture should therefore receive special consideration. 11. Dependence upon foreign countries for articles of necessity, such as food, should be avoided.

12. Increased prices of agricultural products increase not only rents, but likewise the income from capital invested in the farm.

13. The rent in cities is more fortuitous than agricultural rent. The development of industry at the expense of agriculture increases city rents to the disadvantage of rural interests and is unjustifiable.

The

14. Free traders advocate the adoption of a different type of agriculture when the existing ones are threatened by international competition. England, Belgium, and Denmark are cited as examples, where grain culture was in part discontinued in favor of dairying and stock raising. moist climate of these countries was adapted to this, but the dryer climate of Germany did not make such a change feasible, and grain growing had to be continued. A similar argument might apply to certain portions of the United States. (See also TARIFF HISTORY.)

Arguments against agricultural tariffs.

1. The general free-trade arguments apply to agriculture as well as to manufactures. (See FREE TRADE.)

2. Provision for the increasing population can be assured only by a greater industrial development. This is possible only through increased exports, which, because of world competition, can be achieved only when food and raw material costs are not advanced by tariffs.

3. Agricultural tariffs cause higher prices of living, which affect most severely the poorer classes. Agricultural tariffs therefore conflict with social legislation in behalf of these classes. It has not been proved that higher cost of living necessarily brings higher wages.

4. With the growth of population the domestic resources can not produce sufficient food materials, and therefore importation is necessary.

5. The higher prices and subsequently greater incomes caused by the agricultural tariff are transferred to the value of the soil, and in the long run

result only in increased rent and interest beng paid to the landlords and property holders.

6. The small farmers, especially those raising produce, do not benefit directly by the principal agricultural tariffs, those on wheat, corn, wool, etc. 7. Increasing development in transportation makes international exchange more and more efficient as a means to the procurement of necessaries. This efficient method ought to be utilized. 8. Fiscal statistics show that the industrial population (in Germany) pays a larger part of the taxes than the agriculturists. It therefore behooves the State to promote industrial development, and not to promote agriculture at the expense of industry. 9. Agricultural tariffs have the tendency to contract domestic imports and thus to weaken the purchasing power of foreign countries, with the loss of the export market in these regions.1

AIRPLANES. Production.-Statistics of the Bureau of the Census show that reports were received from 16 establishments engaged in the aircraft industry in 1914 with products valued at

1 Roscher, Wilhelm, System der Volkswirtschaft, Nationalökonomik des Ackerbaues, Berlin, 1903, pp. 757-776.

Other references: The Fair Tariff League, Racine, Wis., and the American Farm Bureau Federation, 58 East Washington Street, Chicago, have published a number of studies of agricultural tariffs in the United States; Roncador, Bruno H., Wesen und Wirkung der Agrarzölle, Jena, 1911; Strange, Daniel, The Farmers' Tari Manual, New York, 1892; Taussig, F. W. Some Aspects of the Tarif Question, Cambridge, 1917; Taussig, F. W.. Tariff History of the United States, New York, 1923; U. §. Department of Agriculture, Year Book, 1922, pp. 280, 389, 456; also Year Book of 1923 (see index); Wright, C. W., Wool Growing and the Tariff, Cambridge, 1910; Wright, Philip G., Sugar in Relation to the Tarriff, New York, 1924.

References from periodicals dealing with the tariff in relation to agriculture: Allen, W. C., Review of the Tariff Act of 1922, decisions on items of greatest interest to farmers (Dakota Farmer, vol. 42, No. 777, October 15, 1922); Berglund, Abraham, Tariff Act of 1922 (American Economic Review, vol. 13, pp. 14-33, March, 1923); Fordney. J. W., and others, Tariff on Wool and Cost of Wool Cloth (Rural New Yorker, vol. 82, pp. 39-40, January 13, 1923); Fundamental Tariff Questions (New York Produce Review, vol. 53, p. 635, February 1, 1922); Graham, W., Farmers and the Tariff (Freeman, vol. 8, pp. 83-85, October 3, 1923); Guard, S. R., Low-down on the Tariff (Country Gentleman, vol. 88, pp. 3-4, April 7, 1923); Hagenbarth, F. J., Presi dent Coolidge and the Wool Tariff (National Wool Grower, vol. 13. p. 12, September, 1923); President Hagenbarth's Reply to Wool Tariff Critics (National Wool Grower, vol. 12, p. 16, April 1922); High Tariff and Foreign Trade (Wallace's Farmer, vol. 47, p. 135, February 3, 1923); Kile, O. M., Is the Farmer Goldbricked Again on the Tariff? (Potato Magazine, vol. 4, p. 6, July, 1922); Kile, O. M., Let This be the Last (Successful Farming, vol. 21, p. 5, October, 1922); Miller, J. D., Tariff Commission Attacked (New York Produce Review, vol. 57, p. 60, November 14, 1923): New Tariff and its Influence (Magazine of Wall Street Yearbook, February 10, 1923, p. 29); Rice, J. E., and Jackson, H. W., Adequate Protection for American Egg Producers now Provided (Reliable Poultry Journal, vol. 29, p. 916, December, 1922); Senate Debate upon the Wool Tariff (National Wool Grower, vol. 12, pp. 31-33, September, 1922); Walsh, D. I., Cost of Living as Affected by the Agriculture Schedule of the FordneyMcCumber Tariff Bill, 1922 (speech in U. S. Senate, June 27, 1922).

Publications of the U. S. Tariff Commission relating to agricultural tariffs: Agricultural staples and the tariff, 1920; Älmonds, walnuts, pecans, and other nuts, 1921; Animal and expressed vegetable oils and fats, 1921; Apples, green or ripe and dried, 1921; Bean industry, 1920; Cattle and beef industry, 1922; Coconut products industry, 1920; Cottonseed-oil industry, 1920, Dairy products, 1921; Domestic potato products industry, 1919; Eggs and egg products, 1922; The emergency tariff and its effect upon livestock and livestock products, 1922; Hides and skins, 1922; Macaroni, vermicelli, and all similar preparations, 1921; Onion and garlic industry, 1920; Operation of rates in the emergency tariff act, 1922: Peanut industry, 1920; Peanut oil industry, 1921; Recent tendencies in the wool trade, 1922; Reciprocity with Canada, 1920; Relation of the cattle industry of Canada and the United States, 1924; Relation of the tariff on sugar to the rise in price of February-April, 1923; Sardines, tuna, and anchovies, 1921; Sheep and wool production in Argentina, 1922; Soya-bean oil industry, 1920; Starch and related materials, 1921; Suggested reclassification and revision of sections of the tariff relating to agricultural products and provisions, 1921; Sweet substances other than sugar and molasses, 1921; Wheat and flour trade, 1921; Wheat and wheat products. 1924; Wool-growing industry, 1921.