A specific duty is assessed by measure, as so much per yard, per gallon, per cwt., per caldron, &c., the instrument of measure being such as the nature of the article requires. An ad-valorem duty is assumed to be an assessment according to the value of the article, and the rule of valuation is the foreign invoice, with legal provisions to guard against fraud. Of what effect these provisions are, will be seen by-and-by. Specific duties are not imposed without regard to value; but it is obvious, that this rule applied to any article which has a wide range of values for a given measure, as cloths, wines, tea, coffee, &c., must operate with inequality, when this term is not used in the sense of injustice, which could not easily be proved in such a case, as it is rather a question of discretion and expediency than of right and wrong. One of the objects of specific duties is to abate this inequality, and come nearer to the real values. The ad-valorem mode is also attended with its difficulties, especially when, as in the case of the American law, the rule of valuation is the foreign invoice, the temptations to fraud being so strong, and its means so easily employed, with great chances, usually with a certainty, of impunity. The experience of all governments, down to this time, has decided in favor of the specific mode, as being on the whole most convenient, most secure of the ends aimed at, and especially as being a preventive of immorality and crime. But notwithstanding these reasons of experience, the new American tariff of 1846, on the recommendation of the president, was constructed on the ad-valorem principle, recent. duty; in all, $4,273,000, with an average duty of 38 per cent. If this minimum duty were a tax, it must be seen how it falls chiefly on those who bought the high-priced goods; and that the small amount collected on the low-priced goods was not a tax, is evident, as well from the positive reduction of prices, as from the fact that they are sold against the same description of British goods in all parts of the world. But it has been shown elsewhere, that none of these duties, imposed for protection, are taxes.

But one of the most stupendous effects of the application of the minimum principle of duty, is the opening of a vast market for American cotton fabrics-of course for the raw material-in eastern Asia, whence the same kind of goods formerly came to Europe and America. The cheap labor of China and the far east, has been undersold by the high-priced labor of America, in the application of superior skill and economy of production, and a channel for an annual export of some millions, from the United States, has been opened by this course, destined to increase, almost without limit, under the same system.

South Carolina, in establishing the cotton minimums of 1816, laid the foundation for this turning back upon Asia the most essential production of the Southern states. It is among the strangest things of things strange, that this immense mistake, this fatal blunder, above considered in the text, should have been made by the very parties so vitally injured by it.

jecting the specific. It is proposed to examine these two modes. See note.*

* If one could not be surprised, in the midst of so many new things, one might yet be so, in view of a reason given by the secretary of the treasury for the adoption of ad-valorem as a substitute for specific duties. He says: "Experience proves, that, as a general rule, a duty of 20 per cent. ad valorem will yield the largest revenue." Now, it happens, that all experience leads to the opposite conclusion, and that statesmen, heretofore, in all countries, wishing to raise the largest revenue, by imposts, have preferred the form of specifics. Great Britain has had, and still has, occasion for the highest possible revenue on certain articles, and she invariably, when it is practicable, having that object in view, adopts the specific form, as on teas, the duties on which are at least 200 per cent., and produced, in 1842, upward of $19,000,000. Her duty on sugar, for the same year, specific, produced upward of $24,500,000. The subsequent reduction of duty on sugar, was for relief, not for revenue. Her duties on wines and tobacco are specific, varying from 300 to 900 per cent., and produce a revenue of about $40,000,000. It is unnecessary to go farther for the experience of England. Our revenue for the year 1831, under the high tariff of 1828, the duties having been made specific, as far as possible, was $30,312,851 net, at rates of duty averaging 41 per cent. on dutiable articles. Our lowest tariff was in the last year of the compromise, 1842, with an average duty of less than 24 per cent. — commonly supposed to be 20on dutiable imports, and the net revenue for the year was $12,780,173. Is it such experience which the secretary appeals to? Or where is it? Mr. Polk said, in a speech at Madison, Tennessee, in 1843, while canvassing for the office of governor : It [the tariff of 1842] will not produce annually half the amount of revenue which would have been produced by the lower rates of the compromise act;" that is, by the tariff that was in operation when that of 1842 went into effect. This less than HALF, as will be seen, would have been less than $6,390,036 annual revenue for the tariff of 1842. But it actually produced an average of over $26,000,000 net. Was this the experience on which the secretary came to his conclusion? Twenty per cent. was the commonly alleged maximum, at the time, which produced a revenue of twelve millions and a half.

66

The experience of our own, and of other governments, has, from the beginning, prompted the greatest possible pains to apply specific duties wherever practicable in the nature of the article; and in accordance with this experience, the list of specific duties had been increased, and that of ad-valorems diminished, in all these quarters, at every new modification of the tariff, almost from time immemorial. England has always been aiming at this; many of the continental tariffs, the famous Zoll-Verein in particular, are wholly specific. Mr. Gallatin, when at the head of the treasury, earnestly recommended more specific duties; so Mr. Dallas (Alexander J.); so Mr. Crawford; and under each of these secretaries, as well as under others, much had been done to accomplish the end-chiefly, indeed, to prevent frauds on the revenue, at the same time that specific duties have always been regarded as the best mode of increasing the revenue, if required.

But, though the amount of revenue can not be a trifling consideration, at a time when the public expenditures are running up to between fifty and a hundred millions a year, yet the universal experience of frequent and great frauds, under a system of ad-valorem duties-frauds on the revenue, and frauds on American citizens and interests — presents considerations, which ought to bring every good man to a pause, before he should consent to open such a door to immorality and crime ― to legalize fraud, and offer the most seductive advantages to perjury. What does a European factor of merchandise care for a customhouse oath, who has been bred in a school which teaches, that the evasions of imposts, by whatever means,

As the modes of assessing duties had never been made a party question in the United States, one can hardly account for this is equally a virtue and a duty, and who will glory in it, when beyond the reach of punishment? Such, notoriously, is the state of morals in Europe, on this subject. The writer of these pages has seen and heard it there, as openly proclaimed and boasted of, as the proudest achievements. Nor is this the worst of it. Customhouse officers can be bribed, as abundant experience demonstrates. The temptation to share in the spoils — and such spoils — is equally great to them, as to foreign factors, who, for the consideration they expect to realize, have been judicially proved to have sworn in their false invoices, with as much indifference as if they were making a fair trade. It puts the government, the people, and the interests of the country, on a stupendous scale, in the power of unprincipled villains of the blackest character.

A report of the secretary of the treasury, 1843 (Senate Doc. No. 83, 3d session, 27th Congress), is replete with melancholy instruction on this subject, showing, by the action of the United States court, in the investigation of such cases, that frauds and perjuries, for a term of years, under ad-valorem duties, were habitually and systematically committed by foreign factors, with connivance of customhouse officers, involving great amounts of value; and as but one crime in many is usually detected, the inference is fair, that, aggravated and great as these frauds were, as proved in court, they comprehended but a small fraction of those which were successfully carried on, simultaneously with these, and escaped punishment. In the case of one British importer, "John Taylor, jr.,” aided by a deputy collector of New York, whose name is given as "Campbell," the frauds committed, in the course of twenty-one months, amounted to $200,000. This was but one of many cases brought before the court, and each of the many was doubtless but one of many more that escaped exposure. Such is the system of duties adopted by the tariff of 1846, and such, inevitably, must be the consequences, in this country, or any other, while man remains the same. It was to avoid these crimes, as far as possible, that great pains have been taken, for generations, by all governments, to substitute specific for ad-valorem duties, without regard to the amount of revenue -though it appears, that specific duties are more favorable to that.

The law supposes that ad-valorem duties are assessed on the true value, and that is the intention. But when honest witnesses in court differ so widely, and scarcely any two ever agree, how shall an interested importer be controlled, or ordinarily convicted of his frauds? When the importer can afford to purchase the connivance and aid of a deputy-collector, with a consideration, five, or ten, or twenty times as much as the officer's salary, the door to crime is wide open, and the temptations, with such chances of impunity, are irresistible. The greatest evil is not the robbery of the national treasury. That is one of the smallest, though the amount, in the aggregate, is very great. There is crime, corrupting the administrators of the law, and poisoning the fountains of commercial integrity. Neither American merchants, nor American manufacturers, can stand before such a torrent of iniquity. The former are supplanted, and the latter are ruined. The very foreigner, who, in his own market, has sold a New York merchant goods at one price, comes here, under the screen of his false invoices, and undersells him in the very same articles. How can the American merchant stand, or the American manufacturer live ?

The following is an extract from a memorial to the senate of the United States, signed by 48 firms, or houses, comprehending all the importing drygood merchants, of Boston :

"To the honorable Senate of the United States:

"The undersigned, your memorialists, would respectfully represent, that they are

stupendous mistake of the administration of March 4, 1845. Let the note below, and other facts and reasonings of this chapter, be importers of foreign goods into the city of Boston, and as such they have examined with alarm and consternation, the bill recently passed by the house of representatives [the act of 1816], to change, in a great measure, our system of collecting duties on imports. Should the bill referred to become a law of the land, we are fully convinced that we shall be compelled to abandon our business into the hands of unscrupulous foreigners, who have little or no regard to our customhouse oaths. From long experience, we are fully satisfied, that we can not compete with this class, when duties are based merely on the ad-valorem principle."

The Hon. Wm. H. Crawford, secretary of the treasury, said, in 1818: “The certainty with which SPECIFIC duties are collected give them a decided advantage over duties laid upon the VALUE of the article. It is probable that the most important change which can be made in the SYSTEM will be the substitution of SPECIFIC for ad-valorem duties upon all articles susceptible of that change."

The Hon. James Buchanan, of Pennsylvania, said, in the senate, in 1842: "Our ad-valorem system has produced great frauds upon the revenue, while it has driven the regular American merchant from the business of importing, and placed it almost exclusively in the hands of the agents of British manufacturers. The American importer produces his invoice to the collector, containing the actual price at which the imports were collected abroad, and he pays the fair and regular duty upon this invoice. Not so the British agent. The foreign manufacturer, in his invoice, reduces the price of the articles which he intends to import into our country to the lowest possible standard which he thinks will enable them to pass through the customhouse without being seized for fraud. And the business has been hitherto managed with so much ingenuity as generally to escape detection. The consequence is, that the British agent passes the goods of his employer through the customhouse, on the payment of a much lower duty than the fair American merchant is compelled to pay. In this manner he is undersold in the market by the foreigner, and thus is driven from the competition, while the public revenue is fraudulently reduced."

The Hon. Mr. Evans, in a speech in the senate, 1846, adduced "hundreds of instances" of fraud on the revenue, for under-valuation by foreign invoices.

The following is an extract from a letter to the Hon. Daniel Webster, 1846: “A merchant orders goods to be shipped from France and entered at New Orleans, for the western trade, with the understanding that he is to have them at the foreign cost, with the duties and charges added.

A shipment was made with and forwarded to the purchaser amounting to

....

At the same time the invoice forwarded with the goods to New Orleans was..

6,829.93 francs.

5,258.00 francs.

1,571.93 francs.

Difference......

Or, $316.94 out of $1,300.94.

"The goods were valued, therefore, in the entry, at $316.94 less than they were to the purchaser; and the purchaser was actually charged for the duty on this $316.94 as paid to the government, amounting to $95.10. Both the government and the purchaser were, therefore, cheated out of that sum.

"This transaction occurred in the spring of 1846, and I send you a copy of the correspondence in which these facts are stated, and not denied; but the French house attempts a round-about justification for putting the foreign cost to the purchasers at a greater amount than the entry invoice. J. D."

well considered. They involve too grave, too momentous a question, to be lightly passed over. The principles of a tariff, as they Again, another letter to Mr. Webster :

"BOSTON, July 17, 1846.

"DEAR SIR: I am informed that a respectable house in this city reccived an invoice of European goods from a foreign house, the amount of which was about $2,000, and that, after entering the goods at the customhouse by the invoices, they received another invoice valuing the same goods at about $8,000, with a letter, stating that the first invoice was to levy duties by, and the second to sell by.

"The consignee here, who is also an importer, not being willing to be a party to the fraud, deposited both invoices at the customhouse, where they were yesterday. "I have no doubt of the authority from which I received this information, but I do not wish to be quoted for it.

"I have thought that you might be pleased to know this fact, as the fraud is so great, and the perpetrator beyond the reach of any penal statutes of this country. "Your most obedient servant,

"Hon. D. WEBSTER, Washington.

"P. S. I hear that Mr. Lamson is the consignee.”

"Sir," said Mr. Webster, in the speech in the senate, in which he produced the above letters, July 25, 1846: "Sir, one case more. A highly respectable firm in Boston (Messrs. George H. Gray and Co.) have been dealers many years in hardware, and in the habit of making importations of certain articles from the north. In these articles they found themselves constantly undersold by the dealers in New York. They could not understand the reason of this for a long time; but last spring the secret came to light. They had ordered a small amount of hardware to be sent to them, and in due time the goods came, and two invoices came with them. In one invoice, the cost was stated at 958 thalers; in the other, at 1,402. And the letter accompanying these invoices says: You find herewith duplicate invoices of the greatest part of your order, &c. The original I send by Havre packet. You also find herewith an invoice made up in the manner like [that which] the most importers of your country require; perhaps to save some duty.'

"Now, sir, these original invoices, the false and the true, and the original letter which I have read, are now in my hand; and any gentleman, who may feel disposed, may look at them. Of course, Messrs. Gray & Co. carried both invoices to the customhouse, because they were honorable merchants; and the duties were assessed on the higher invoice. And by this time these gentlemen were no longer at a loss to account for the low price, at which this description of merchandise had been selling in the city of New York.

"But now, sir, take not a single case, but the results of long experience. I am about to read a letter, not addressed to me, but placed in my hands, from a gentleman well known, I presume, to both the senators of New York, and to other members. This letter, I think, will startle the honorable chairman. [The Hon. Dixon H. Lewis, who had said, he "did not believe that a case of fraudulent under-valuation had ever been made out."] It must open to his mind quite a new view of things. "TROY, July 14, 1846.

“‘Le Grand CANNON, Esq.-SIR: Agreeably to your wish, I avail myself of this opportunity to give you the benefit of my experience in mercantile and manufacturing business, hoping it may tend to an improvement of the bill, now pending in the senate, for the collection of duties. I hope members of Congress will have the same views of the probable results which I anticipate; which are, that the system of ad-valorem duties does give the foreign importer and manufacturer a very undue advantage over the American importer. This will be apparent from my