LETTERS 
 
 THE PRESIDENT, 
 
 FOREIGN AND DOMESTIC POLICY 
 
 THE UNION, 
 
 ITS EFFECTS, 
 
 AS EXHIBITED IN THE 
 
 CONDITION OF THE PEOPLE AND THE STATE. 
 
 BY 
 
 H. C. CAREY. 
 
 PHILADELPHIA: 
 J. B. LIPPINCOTT & GO. 
 
 LONDON: TRUBNER & CO. 
 
 PARIS: GUILLAUMIN & CO. 
 
 1858. 
 
 .
 
 F 
 
 CONTENTS. 
 
 PAGE 
 
 LETTER I. Historical sketch of the Union, from the peace of 1783, to 
 
 the present time 3 
 
 II. Of banking, in the Union, for the half century which fol- 
 lowed the peace of 1783 8 
 
 III. Of banking, in the last five-and-twenty years 13 
 
 IV. Phenomena offered for consideration, by the Union, at the 
 
 present time , 18 
 
 V. Evidences of material, moral, and political deterioration.. 24 
 VI. Phenomena of advancing and declining civilization 81 
 
 VII. Growing dependence of the American farmer on the dis- 
 tant market its effects 35 
 
 VIII. Growing dependence of the planter 40 
 
 IX. Decline in the power of the products of the earth, to com- 
 mand finished commodities in exchange 45 
 
 X. Waste of power, throughout the Union, and consequent 
 
 exhaustion of the soil 50 
 
 XI. Decline in the power to maintain commerce 67 
 
 XII. The sort of free trade that is really required 63 
 
 XIII. Policy of the Federal government in reference to the cur- 
 
 rency 69 
 
 XIV. The precious metals the great instruments of association, 74 
 
 XV. Those metals go from the countries that have little com- 
 merce, to those, in which employments are diversi- 
 fied, and in which commerce is great 79
 
 iv CONTENTS. 
 
 LETTER XVI. Influence of banks, and bank notes, on the supply of 
 
 the precious metals 87 
 
 XVII. How the policy of the Union affects the shipping in- 
 terest 94 
 
 XVIII. Increasing difficulty of obtaining efficient means of 
 
 transportation 99 
 
 XIX. Increasing charge for the use of money 105 
 
 XX. Causes of the growing difficulty of accumulation 113 
 
 XXI. Why it is, that protection is required 120 
 
 XXII. Of the British system, and its effects upon the planters 
 
 and farmers of the world 126 
 
 XXIII. Of the policy of France, and its effects, at home and 
 
 abroad 131 
 
 XXIV. Commerce grows by aid of the French system, and de- 
 
 clines under the British one 189 
 
 XXV. Power to maintain commerce with foreign nations grows 
 
 with the growth of domestic commerce 144 
 
 XXVI. Harmony of all real and permanent international in- 
 terests 148 
 
 XXVII. Decline, throughout the Union, in the power to main- 
 tain the local institutions 153 
 
 XXVIII. Declining power to contribute to the revenue of the 
 
 State 159 
 
 XXIX. Conclusion .. 166
 
 L E T T E ES 
 
 TO THE 
 
 PEESIDENT OF THE UNITED STATES. 
 
 LETTER FIRST. 
 
 SIR : In common with a large portion of our fellow-citizens, 
 I have looked with much anxiety for the appearance of your 
 Message hoping for some suggestions tending towards the 
 relief of the community, from the accumulated evils under which it 
 now so severely suffers. In this, however, I have been disappointed, 
 having found therein, only the assurance, that, while the govern- 
 ment "cannot fail deeply to sympathize" with the people in their 
 distresses, it is wholly "without the power to extend relief" 
 the cause of difficulty being to be found in the vicious action of the 
 local institutions, which are beyond the reach of any action 
 of the central government. For more than forty years, as we are 
 here assured, the history of the country has been one of ' ' extra- 
 vagant expansions in the business of the country, followed by 
 ruinous contractions. At successive intervals," as you continue to 
 say, " the best and most enterprising men have been tempted to 
 their ruin by excessive bank loans of mere paper credit, exciting 
 them to extravagant importations of foreign goods, wild specula- 
 tions, and ruinous and demoralizing stock-gambling. When the 
 crisis arrives, as arrive it must, the banks can extend no relief to 
 the people. In a vain struggle to redeem their liabilities in 
 specie, they are compelled to contract their loans and their issues ; 
 and, at last, in the hour of distress, when their assistance is most 
 needed, they and their debtors together sink into insolvency." 
 
 For all these difficulties, we are, as you have here informed 
 your constituents, indebted to the excess of power in the States. 
 " The framers of the Constitution," in your opinion, having given 
 
 (3)
 
 4 LETTERS TO THE 
 
 " to Congress the power ' to coin money and to regulate the value 
 thereof,' and prohibited the States from coining money, emitting 
 bills of credit, or making anything but gold and silver coin a 
 tender in payment of debts, supposed they had protected the 
 people against the evils of an excessive and irredeemable paper 
 currency. They are not," in your opinion, to be held "responsible 
 for the existing anomaly, that a government endowed with the 
 sovereign attribute of coining money and regulating the value 
 thereof, should have no power to prevent others from driving this 
 coin out of the country, and filling up the channels of circulation 
 with paper which does not represent gold and silver." 
 
 The Constitution having, in this respect, as you suppose, proved 
 a total failure, the remedy is, as you seem to think, to be found 
 in increasing the power of the Federal government, at the expense 
 of those of the States. Admitting the facts to be precisely as you 
 appear to think them, you are certainly right, and the sooner we 
 make the change, the better will it be, not only for ourselves, 
 but for the world at large so frequently disturbed by re- 
 vulsions consequent, as it would seem, upon the existence of our 
 Federal system. Before, however, deciding, that the fault does 
 really lie with the States and, still more, before deciding to 
 make a change in that direction, it would, as it seems to me, be 
 well, calmly to review the past giving the facts in the precise 
 order of their occurrence, and thus enabling our fellow-citizens to 
 determine for themselves, whether the difficulties you have so well 
 described, have had their origin in the excess of central, or of 
 local, action. Such an examination might prove, that the cause 
 of those revulsions lay with the central government; and, if so, 
 then, any motion in the direction you have indicated, would but 
 augment the evils under which we suffer. Firmly believing that 
 such would be its result, I am induced to address to you this 
 letter doing so, in the full confidence, that you would much 
 rejoice in having it demonstrated, that, the cause of error not 
 being found in the local action, we might safely permit the 
 Constitution to remain untouched leaving the local authorities 
 to continue in the exercise of all the powers not expressly parted 
 with, when the sovereign States united in the formation of our 
 present Union. It being the tendency of power to steal from the 
 hands of the many to those of the few, "liberty," as has so well 
 been said by one of your illustrious predecessors, " can be main- 
 tained, only at the price of eternal vigilance ; " and if, by reason 
 of failure in its exercise, we should, under your guidance,, make 
 any step in a direction adverse to freedom, it would to you, I am 
 well assured, be cause of great and permanent regret. Without 
 apology, therefore, it is, that I ask your attention to the following 
 brief summary of our history, in the past half century. 
 
 From 1807 to 1815, we were, in a great degree, driven from 
 the ocean, and forced to look homeward for our commerce
 
 PRESIDENT OF THE UNITED STATES. 5 
 
 non-intercourse laws having followed closely on the heels of an 
 embargo, and that, in its turn, having been succeeded by a war 
 with England. Manufactures had, of course, grown rapidly 
 making a market at home for all the products of the earth, 
 and enabling the consumers and the producers to take their places 
 by each other's side. As a consequence of this it was, that after the 
 close of the war, there existed, throughout the country, a degree 
 of prosperity such as had never before been known. Farmers 
 and planters were rich, for the prices they obtained were great. 
 Mechanics were prosperous their services being everywhere in 
 demand. The revenue was large, for the people could afford to 
 pay for the products of foreign lands. The government was 
 strong, for it was rapidly diminishing the public debt. 
 
 Less than two years later, however, the whole was changed 
 the duties on imports having then been much reduced, and ad 
 valorem duties, to a considerable extent, substituted for those- 
 which had been specific. The consequences of this speedily exhi- 
 bited themselves, in the extensive closing of manufacturing esta- 
 blishments in the creation and failure of numerous banks in 
 the decline in price, of all the products of the farm and the planta- 
 tion, and the ruin of farmers and planters in the diminished 
 demand for labor in the growth of pauperism in the export 
 of specie and in a growing public debt. Free trade had found 
 the country, in 1816, in a state of high prosperity, but it left it 
 almost ruined. x 
 
 With the year 1824, there came a partial change, followed, in 
 1828, by a more extensive one the central government then 
 changing its policy from a free trade to a protective one. Here, 
 again, the effects were speedily seen, in the revival of manufac- 
 tures in the demand for the products of the earth in the 
 import of specie in an increase of the public revenue, so great 
 as to require the emancipation of tea, coffee, and other com- 
 modities, from all contribution to the public revenue in the final 
 extinction of the public debt in a general prosperity, public and 
 private and in a feeling, throughout the community, of strength 
 and power, far exceeding even that which followed the return of 
 peace, in 1815. That prosperity, however, was a quiet and 
 tranquil one there having been but little speculation, and, 
 therefore, little tendency towards the creation of unnecessary 
 banks. The few that had been created, had found their places in 
 the Eastern States. The total number in 1830, was but 321, 
 against 307 that had existed ten years previously ; and the increase 
 in the amount of capital, was but $3,000,000 the $107,000,000 
 of 1820, being represented in 1830, by $110,000,000. 
 
 Again, however, in 1834, the system of the central government 
 was changed provision having been made in 1833 for the gradual 
 passage fron^a protective to a merely revenue tariff, the last stage 
 of which was to be reached in 1842. Numerous banks were now
 
 6 LETTERS TO THE 
 
 again created ; enormous foreign debts were incurred ; and the 
 result was seen, in the insolvency of the banks the ruin of the 
 merchants the prostration of the farmers and planters the 
 drain of specie the repudiation of States and the bankruptcy 
 of the treasury the government itself being reduced to the use 
 of inconvertible paper money, as the only means by which the 
 machine of state could be kept in motion. 
 
 Once again, in 1842, the system of the central government wns 
 changed a highly protective tariff having been substituted for 
 the revenue one of 1841-2. Few, if any, banks were now created ; 
 foreign debts were now paid off; banks now resumed payment; 
 merchants became, once again, prosperous ; specie flowed in ; States 
 became again able to collect their taxes, and thereby redeem them- 
 selves from the disgrace of repudiation ; and the revenue increased 
 rapidly, while the peaceful policy of the country greatly facilitated 
 1 reduction in the sums demanded from the treasury. Peaceful and 
 quiet prosperity was the characteristic of this period there 
 having been no speculative movement whatsoever, and, therefore, 
 no inducement for any extension of the number of institutions em- 
 ployed in money operations. At no period in the history of any 
 country, had there existed so high a degree of confidence in the 
 future, as was found here existing, in the year which preceded the 
 enactment of the revenue act of August, 1846. 
 
 By that act, the system of. the central government wns once 
 more changed protection having been abandoned, and the tariff 
 having been adjusted with reference to revenue alone. It has 
 now been in existence eleven years years characterized by an 
 amount of instability and uncertainty in all commercial affairs, 
 almost equal to that which existed in the period which embraced 
 the embargo and non-intercourse acts, and the war which fol- 
 lowed. Banks innumerable have been created. Prices have 
 risen and fallen repeatedly the changes having been great, 
 almost beyond all previous precedent. Flour and cotton have, 
 at times, been lower in price than had ever before been known ; 
 while, at others, they have exhibited a tendency towards rising to 
 the point at which they had stood at the passage of the free trade 
 act of 1816. The result is seen irt the fact, that the manufacturers 
 and the merchants are ruined that the number of persons unem- 
 ployed is great, beyond all former precedent that the prices of 
 all our staples are falling with great rapidity that our ships are 
 unemployed that our banks have again been driven to suspen- 
 sion that the revenue has failed and that, notwithstanding the 
 receipt of hundreds of millions of Californian gold, the government 
 is reduced again to the necessity of using an inconvertible paper 
 money, as the only means of keeping itself afloat. 
 
 In a state of barbarism, theories abound, and they do so, because, 
 in default of knowledge, almost every occurrence is regarded as 
 accidental, or is attributed to the direct interposition of some
 
 PRESIDENT OF THE UNITED STATES. 7 
 
 imaginary being, good or evil, as the chance may be. With time, 
 however the regular succession of cause and effect coming 
 to be understood men, by degrees, arrive at the knowledge 
 of the existence of laws, by which the movements of both men 
 and matter are governed. What, then, is the law, that may be 
 deduced from the above brief history ? In reply, it may be said, 
 that in every case in which the central government has moved in 
 one direction, few banks have been created speculation has 
 been trivial specie has flowed in the credit of the banks has 
 been maintained manufacturers, merchants, farmers, and planters, 
 have been prosperous States have paid their interest the 
 revenue has been abundant, and the public debt has been dimin- 
 ished leaving, to the succeeding policy, a people in a state of 
 high prosperity a community 'growing in power, and in the 
 respect with which they have been regarded and a government 
 becoming, from day to day, more independent in its action. 
 
 On the other hand, we see that in every case in which it has 
 moved in an opposite direction, the reverse effects have been pro- 
 duced many banks having been created speculation having 
 been carried to the pitch, almost, of frenzy specie having flowed 
 out the monetary institutions of the country having been, on 
 both the last occasions, driven to suspension manufacturers and 
 merchants, farmers and planters, having been ruined stay-laws 
 having been enacted States having repudiated their debts 
 revenue having declined until it has almost ceased, and the 
 public debt having increased leaving to the succeeding policy, a 
 people in a state of ruin, a community declining in power and in 
 the respect of the world, and a treasury almost bankrupt. 
 
 Such being the facts presented for consideration, on a survey 
 of the policy of the country, for the long period of fifty years, the 
 law to be deduced therefrom, would seem to be as follows : 
 Under the system which looks to bringing together the producer 
 and the consumer, the community increases in strength, wealth, 
 and power; whereas, under that, which looks to separating the 
 consumer and producer, and is known as "free trade, 1 ' it 
 declines in all becoming daily poorer, weaker, and more 
 dependent. 
 
 That being the law, it would seem to follow that the cause of 
 ruin is to be found in the central government ; and that it is to a 
 modification of its action, and not to that of the local govern- 
 ments, we should look for remedies for existing evils. That such 
 is certainly the case, I propose to offer further evidence in another 
 letter remaining meanwhile, with great respect, 
 
 Your obed't servant, 
 
 HENRY C. CAREY. 
 
 Philadelphia, December 21st, 185T.
 
 LETTERS TO THE 
 
 LETTER SECOND. 
 
 To insure to the people a sound circulation, appears to you, 
 Mr. President, to be "one of the highest and most responsible dutifes 
 of government" the one, too, requiring "the utmost possible 
 wisdom and skill," so to adapt it to "the wants of internal trade 
 and foreign exchanges," as to prevent fluctuations in the value 
 of property, such as the American historian is so frequently called 
 upon to record. "Unfortunately," however, in your estimation, 
 "under the construction of the Federal Constitution, which has 
 now prevailed too long to be changed, this important and deli- 
 cate duty has been dissevered from the coining power, and virtually 
 transferred to more than fourteen hundred State banks, acting 
 independently of each other, and regulating their paper issues 
 almost exclusively by a regard to the present interest of their 
 stockholders." 
 
 Such being the unhappy results of our Federal system, the 
 central government cannot, as yon say, "do much to provide 
 against a recurrence of existing evils." Utterly powerless itself 
 for good, while surrounded by local governments all-powerful for 
 evil, all that it can do, is, to " rely upon the patriotism and wis- 
 dom of the States for the prevention and redress of the evil. If 
 they," as you continue, "will afford us a real specie basis for our 
 paper circulation by increasing the denomination of bank notes, 
 first to twenty, and afterward to fifty dollars ; if they will require 
 that the banks shall, at all times, keep on hand at least one dollar 
 in gold and silver for every three dollars of their circulation and 
 deposits ; and if they will provide by a self-executing enactment, 
 which nothing can arrest, that the moment they suspend they 
 shall go into liquidation, I believe that such provisions, with a 
 weekly publication by each bank of a statement of its condition, 
 would go far to secure us against future suspensions of specie 
 payments." 
 
 That efforts will be made to do these things is highly probable, 
 but to what purpose ? None, whatsoever ! The records of our 
 State legislatures, for the last twenty years, present to view a host 
 of laws, having for their object the production of a state of things 
 such as you here desire ; and yet, on the first occasion, they are 
 set aside, and as unhesitatingly, by the same legislative bodies, 
 as has been the famous provision in the Charter Act of the Bank of 
 England. Why is this ? Because the regulation of the currency, 
 on this side of the Atlantic, has been in the hands of men, as 
 little capable of executing that "highest and most responsible of 
 the duties of government," as Messrs. Overton and Peel are proved 
 to have been on the other. The provision of the English law being
 
 PRESIDENT OF THE UNITED STATES. 9 
 
 like those in our own charters based upon a fallacy, has now been 
 twice suspended ; and suspended it must again be, whenever the 
 time shall arrive, that its services will again be needed. So is it, 
 and so must it continue to be, with all similar provisions in the 
 charters of this country as long as the action of the central 
 government shall continue to be hostile to the establishment of a 
 perfect currency ; for there, and not with the local institutions, 
 lies the difficulty, as you may rest assured. 
 
 Let it be supposed, however, that the States continue to pursue 
 their own course doing, in the future, precisely as they have done 
 in the past creating banks ad libitum, and not providing, 
 effectively, for carrying out the plan that is here suggested. That 
 they will not so provide, seems very evident. More than twenty 
 years since, one of your predecessors denounced banks and bank 
 notes, in terms as strong as those now used by you ; and since that 
 time, their denunciation has constituted an essential portion of the 
 creed of the great democratic party that party of which you, 
 sir, are the representative ; but, with no other effect, as yet, than 
 that of more than quadrupling the number of banking institutions 
 the 328 banks of 1830 being now represented by more than 
 1400. This being progress backward, with what reason can we 
 look for such a change in the modes of thought, as would produce 
 a movement in the direction you desire ? As I think, with 
 none. If then, the facts be as you hold them to be if the 
 difficulty does really rest with the local governments and if our 
 only chance of remedy is to be sought in State discretion then 
 are we truly helpless ; and then is our Federal system a total 
 failure. Fortunately, such is not the case. Fortunately, the 
 difficulty does not lie with the States, as you, I am sure, will 
 gladly be convinced, after reading the brief sketch of our banking 
 history, that will now be made. 
 
 American banking had its origin in New England the good 
 sense of its people having early taught them the advantages that 
 must result, from having places at which those who had money to 
 lend, could readily meet those who desired to borrow both par- 
 ties being thus relieved of all necessity for the employment of 
 middlemen, in the arrangement of their exchanges. From the close 
 of the war, in 1783, to 1811, the average number of banks in 
 existence, throughout the New England States, was 16; while 
 the number of failures in all that period embracing, as it did, 
 the years in which, under French decrees, and British Orders in 
 Council, the seas were swept of American ships was only four. 
 
 Taking now a longer period, the half century from 1785 to 
 1835 embracing not alone the times of piracy on the ocean, above 
 referred to of embargoes and non-intercourse laws but, also, 
 those of the war of 1812 of the disturbed period that followed 
 close upon the peace and of the celebrated crisis of 1825 we 
 find the number of banking institutions to have averaged no less
 
 10 LETTERS TO THE 
 
 than sixty; while the total number of failures, in the whole half 
 century, was only twenty, or two in every five years, of a period 
 of greater commercial disturbance than had ever before been 
 known. Of these failures, five took place in Massachusetts; but 
 by these the public suffered little, if any, loss. One paid all its 
 debts. A second, it is believed, did the same. Of the third, the 
 bills outstanding, at the date of its stoppage, were but $21,000. 
 The remaining two certainly paid every outstanding claim, except 
 $19,878 ; and it is not now certain, that even that small sum was 
 not subsequently paid. Admitting, however, that it remained 
 unpaid, the total loss to the people of Massachusetts, in a period 
 of fifty years, from dealing with banks, was less than $1000 per an- 
 num, and not more than one dollar in every million, or the 
 ten -thousandth part of one per cent. of the transactions whose 
 performance had been facilitated by the existence of such institu- 
 tions, and by the substitution of bank notes for a metallic cur- 
 rency. Small, even, as is that proportion, it might, as I think, 
 be much reduced it being based upon the idea, that the opera- 
 tions facilitated were but forty times the amount of the capital ; 
 whereas, it might be almost safe to place them at four hundred 
 times that amount in which case, the proportion of loss sus- 
 tained, would be only the hundred-thousandth part of one per cent. 
 
 I pray you now, Mr. President, to reflect upon the quantity of 
 service rendered by banks, in collecting, guarding, and transfer- 
 ring property all of this work being done, without charge of any 
 kind ; and to determine for yourself if, in any other case, so large 
 an amount of service is rendered at so small a cost. The broker 
 charges an eighth, or a quarter per cent., when he arranges a 
 transfer of stocks. The wholesale dealer charges 2^, or 5 per 
 cent. The retailer takes 10, 15, or 20 per cent. ; but the bank 
 performs an amount of service whose sum is equal to the total 
 amount of the exchanges of society, in which money is used 
 charging nothing whatsoever. Sometimes, a banking institution, 
 badly managed, falls into difficulty. So, however, is it with 
 brokers and commission merchants. In the case of these latter, 
 however, the loss is generally almost total ; whereas, in that of 
 the banks, the loss falls almost exclusively upon those who had 
 done the work the stockholders. 
 
 Seeing the facts to be as I state, I would frsk you, Mr. Presi- 
 dent, to say, if you had been a resident of Massachusetts and 
 what is said of that State is almost equally true of all New Eng- 
 land, in the period above referred to would you have been 
 pleased, whenever you had a large amount of money to receive, 
 to .find yourself compelled to carry your silver on your back, or in 
 a wheelbarrow ; or to pay a commission to have it converted into 
 gold, in order that you might be enabled to transfer it from place 
 to place ; and to do all this, too, because it had been determined 
 that it was the duty of "the government" to furnish a currency
 
 PRESIDENT OF THE UNITED STATES. 11 
 
 that that doty required great " wisdom and skill" by the appli- 
 cation of which, it had arrived at the conclusion, that shopping 
 with bags full of dollars was far more convenient and agreeable 
 than the performance of the same operation, with the aid of 
 pocket-books filled with pieces of paper, by means of which this 
 property in money could be transferred without the necessity for 
 hauling the silver, or the gold ? That you would have preferred 
 the notes, I feel assured. 
 
 In New York, the banks, in the thirty years prior to 1837, had 
 averaged 26 in number ; and the total number of failures had 
 been 16 ; or about one-half of one per cent., per annum. The 
 losses, however, fell so almost exclusively upon the stockholders, 
 that if we here estimate the risk of loss to the community, by 
 reason of dealing with banks, or of using bank notes, at a single 
 dollar in a million, it is much beyond the truth. 
 
 In Pennsylvania, the average number of banks in existence, in 
 the same period, had been 29, and the total number of failures 
 had been 19 nearly all of them, in the calamitous period that 
 followed the adoption, by the central government, of the free 
 trade policy of 1816-18. Being an agricultural state, Pennsyl- 
 vania suffered heavily from the great depression in the prices of 
 all her products, when she lost the domestic market that had been 
 supplied by mines and furnaces at home, and factories and fur- 
 naces in other States. From 1820 to 1837, there were but three 
 failures, all of them trivial in amount. In that period, all the 
 loss to the people of the State, from trading with banks, or 
 from the use of bank notes, was not even a single dollar in a 
 million that having been all the price they had paid, for the 
 vast amount of services performed by their banking institutions. 
 
 Passing thence south and west, we find, at every stage, a 
 diminishing density of population, attended with increase of risk. 
 South of Pennsylvania and of the Ohio river, there were, in the 
 period ending in 1836, no less than 84 failures, while, west of 
 that State, the number was 27. Nearly the whole of them had 
 resulted, as had those of Pennsylvania herself, from the premature 
 attempt to establish shops for the purchase and sale of money, in 
 regions where all desired to buy, and none had that commodity 
 to sell. The consequences were such as might well have been 
 anticipated. After fruitless attempts to establish themselves in 
 business, they stopped payment doing thus, as would be done 
 by an individual who had engaged in a pursuit for which the 
 community was not prepared. 
 
 North and east of the Ohio river, the total number of failures, 
 from the first institution of a bank, to the year 1836, was precisely 
 b'5 ; or, less than one-half of the failures of private bankers, 
 in England, in the years 1821-26 a period in which there was 
 no extraordinary occurrence no change from war to peace, or
 
 12 LETTERS TO THE 
 
 from peace to war to produce a feeling of insecurity, or to be 
 the cause of loss. 
 
 Including all the States, north, south, east and west, the num- 
 ber of failures, from the date of the first bank, had been, in 1836, 
 less by one-fourth than those of England, in the three years, 
 1814-16; and the amount of loss sustained by the American 
 public in a century, had not, as I. believe, been one-twentieth 
 as great, as that of the people of England, in three short 
 years. 
 
 Since 1836, there has been a change, the causes of which will 
 be shown in another letter. 
 
 Yours, very respectfully, 
 
 HENRY C. CAREY. 
 
 Philadelphia, December 23d, 1857.
 
 PRESIDENT OF THE UNITED STATES. 13 
 
 LETTER THIRD. 
 
 HAVING small respect for authority, General Jackson attached 
 little value to the labors of Hamilton and Madison, commentators 
 on the Constitution ; or to those of Jay, Ellsworth, and Marshall 
 the men, Mr. President, to whom we owe those early decisions, 
 which laid the foundation of our constitutional law decisions 
 fully acquiesced in, by all the distinguished men who had pre- 
 ceded him in the Presidential chair, from Washington to the 
 younger Adams. Preferring his own construction of that instru- 
 ment, he was little more than seated in the high position to which 
 he had been called, than he commenced suggesting doubts, as to the 
 power of the government to delegate to individuals, the power to 
 exercise, throughout the Union, the banking privilege. In his 
 view, a State bank, based upon the public revenues, and managed 
 of course, by officers of the general government, would have been 
 greatly to be preferred. 
 
 Centralization being now the order of the day, and Congress 
 failing to obey his orders, we find him next, on his own motion, 
 withdrawing the public moneys from where they had been placed 
 by Congress and, at his sovereign will and pleasure, dividing 
 them among the local institutions. Next, he is found, urging the 
 States to the creation of local banks, to replace the great institu- 
 tion with which he was now at war. That done, we see him 
 next, declaring war against all banks and notes the whole 
 power of the central authorities being now exerted, for the coer- 
 cion of the States into the prohibition of bills of the smaller 
 denominations. Gold being now regarded as the one thing need- 
 ful, it was, as we were told, to be made to "run up the Missis- 
 sippi ;" and, that it might do so, the standard was changed the ex- 
 changeable value of gold, as compared with silver, having been raised 
 to 16 to 1. Following on this, we have an order to the receivers 
 of the revenue, to accept of nothing but the precious metals 
 notes of all denominations being thus discredited, that the people 
 might be induced to make a run upon the banks. Now, for the 
 first time in the history of the world, do we find a regularly organ- 
 ized government engaged in a war to the knife against credit, in 
 all its forms ; and now, for the first time in a period of peace, 
 were the banks of the Union compelled to close their doors, 
 against those who desired payment of their notes. Next, we 
 find the Treasury demanding additional powers, and gently inti- 
 mating that by aid of the public revenues, the domestic exchanges 
 might be much facilitated. On one side, the Postmaster-General 
 desires that his agents may be employed in the transmission of 
 private funds ; while, on another, the attention of Congress is spe-
 
 14 LETTERS TO THE 
 
 oially invited to the advantage that would result from the insti- 
 tution of a government office, charged with the issue of paper 
 
 money thereby superseding the local institutions altogether. 
 
 The war thus commenced, has since been followed up the use 
 of circulating paper having been repudiated by the government 
 vaults having been constructed, in which to store the public trea- 
 sures and the standing topic of denunciation, at conventions of 
 towns and cities, counties and States, and of the Union itself, 
 having been banks and paper money. The result is seen, in the 
 fact, that gold has ceased to circulate, and that the treasury is 
 driven to the use of inconvertible notes. 
 
 Such is the history of banking in the United States, since the 
 peace of 1783 a period of seventy-five years, during the first 
 fifty of which, the power reserved by the States had been respected 
 and that, too, most scrupulously by Washington, Adams, Jef- 
 ferson, Madison, Monroe, and the younger Adams; whereas, 
 since that time, there has been an unceasing effort to weaken the 
 States, while strengthening the central power. How far the one, 
 or the other, of the systems thus described, has tended to increase 
 the security of persons and of property, by giving to the people 
 that which you, Mr. President, so much desire, "a sound circu- 
 lating medium," the amount of which "has been adapted with 
 the utmost wisdom and skill " to the needs of commerce thereby 
 insuring that "the market value of every man's property" shall 
 not, by reason of its fluctuation, "be increased or diminished" 
 and thus preventing " the incalculable evil" that might otherwise 
 be produced is shown in the following brief resumd of the above 
 short history. 
 
 For nearly half a century during which, banks, and their circu- 
 lation, had been left, in accordance with the Constitution, under 
 the control of the local legislatures, their number was so pru- 
 dently increased, that, at its close, it was only 328. In half that 
 time, during which the central government has undertaken to su- 
 persede the State authorities, it has grown to more than 1400. 
 
 For half a century, during which the State authorities remained 
 undisturbed, neither the people nor the government ever failed, 
 in time of peace, to be supplied with coin for circulation. In 
 half that time, under the direction of the central government, both 
 government and people have twice been driven to the use of an 
 irredeemable paper circulation. 
 
 For half a century, the State authorities so managed the bank- 
 ing system, that no general suspension ever occurred, except 
 when at the instance of the general government, and after 
 having largely aided that government, in the then existing war 
 against Great Britain they stopped in the autumn of 1814, and 
 remained suspended, until the return of peace enabled them once 
 again to resume their operations. In half that time, since the 
 central government has assumed to supersede the local ones,
 
 PRESIDENT OF THE UNITED STATES. 15 
 
 there have been two suspensions that have been general ; and a 
 third, in which were embraced, all the States that had followed 
 the lead of the central power, in prohibiting the use of the smaller 
 notes the only States that did not then suspend, having been 
 those which had persisted in the determination to regulate their 
 currency for themselves. Once again, the suspension has ceased 
 to be general ; and I would now, Mr. President, ask your particular 
 attention to the fact, that all the States, with, I believe, but one 
 exception, that use small notes, have now resumed, while all of 
 those, with one exception, that have prohibited the smaller notes, 
 remain suspended. 
 
 Such, Mr. President, are the facts, and being such, they fur- 
 nish, as I think, a reply that is most conclusive to the argument 
 you have just presented, in favor of an extension of the central 
 power. All of them having passed before your own eyes, all of 
 them have been known to yon, but, by reason of the unceasing 
 demands upon your time, in the various honorable offices you have 
 been called to fill, many of them had, doubtless, escaped your 
 recollection. Had it been otherwise, you certainly would have 
 hesitated, before recommending any enlargement of a central 
 power, whose injurious influences had been so fully demonstrated. 
 While recognizing the authority of the States, as being beyond 
 the reach of any direct assault, you suggest a mode, by means of 
 which, power may now be centralized in the hands of Federal 
 agents ; and yet, the mere fact of the necessity for resorting to 
 means so indirect, would seem to me to furnish proof conclusive 
 of your error. It is within the power of Congress to establish 
 " uniform laws on the subject of bankruptcies throughout the 
 United States;" but, it being not within it to enact any law, 
 that shall not be of general application to all the people of the 
 Union, the enactment of such an one as that you now suggest, 
 would certainly seem to be a direct violation of the Constitution. 
 How far it is within the power of Congress, to pass a law that 
 shall embrace both individuals and corporations, it is not for me 
 to say ; but, certain it is, that eminent jurists have held, and do 
 still hold, that the States did not, when accepting the Constitu- 
 tion, grant to Congress any control, whatsoever, over corporations 
 holding their existence under the local laws. That, however, 
 Mr. President, will be a question of small importance, if I shall 
 have succeeded in satisfying you, that all the monetary diffi- 
 culties we have experienced, and which you so well describe, have 
 had their origin in the attempt to withdraw from the States, the 
 power reserved to them by the Constitution in an excess of cen- 
 tralization, and not in any excess of localization. 
 
 We are told, however, that the quantity of gold now in the 
 country, amounts to no less than $260,000,000 ; and are, there- 
 fore, urged to force it into use. It may be so, that there is that
 
 16 LETTERS TO THE 
 
 quantity ; but, if so, where is it ? A year since, the banks had 
 $50,000,000; and'they have no more now. A year since, the 
 sub-treasuries held $20,000,000; now, they have $6,000,000. 
 Adding together these two sums, we have $56,000,000 leaving 
 $204,000,000 yet to be accounted for. Where may they be found ? 
 lu use among the people they certainly are not, for the largest 
 calculation of gold and silver in use, cannot exceed one dollar 
 per head giving $30,000,000 as the quantity usefully employed, 
 and. leaving $174,000,000 yet to be discovered. Where must 
 they be sought ? If anywhere, they are hoarded. Why are they 
 hoarded ? Because the government sets the example of hoard- 
 ing the precious metals, and thus teaches the people what it is, 
 that they themselves should do. Because, for twenty years past, 
 the government, and its friends, have denounced banks as being 
 insecure, and bank notes as being worthless rags. Because, in 
 opposition to the practice of all really enlightened governments, 
 our own has been, for the last five and twenty years, engaged in 
 an almost unceasing war upon private credit. For these reasons 
 it is, that the precious metals are now so extensively hoarded, and 
 while so hoarded, as useful as an equal weight of pebble-stones 
 would be. 
 
 How can all this gold be brought into active circulation ? An 
 answer to this question, Mr. President, may be found in one of 
 those delightful fables, that you, in early life, must have often 
 read. The wind and the sun differed, one day, as to which could 
 most readily compel a traveller to lay aside his cloak. The wind 
 commenced blowing with all his might ; but the harder he blew, 
 the tighter the cloak was held. The sun next tried his hand 
 darting his warmest beams upon the traveller's head. Forthwith 
 the hold upon the cloak was loosened, and before the lapse of 
 many moments, it was thrown aside. Here, Mr. President, is a 
 great lesson, by the study of which the government might largely 
 profit. For more than twenty years, your predecessors have been 
 endeavoring to force the people to the use of gold seeking to 
 accomplish that object, by means of the annihilation of the credit 
 of banks and individuals ; but the effect, as yet, has been only 
 that of driving it out of circulation, and into private hoards, the 
 amount of which is, probably, immensely great. Having played 
 the part of the wind, and failed, let it now, Mr. President, under- 
 take that of the sun seeking to increase the confidence of the 
 people in one another; and the effect will speedily be seen, in the 
 re-appearance of the gold that is now so useless. Let this be 
 done let the treasury smile upon the people, instead of frowning 
 upon them let it make common cause with the producing classes, 
 and not with the merely consuming ones let it cease to make 
 war upon the powers of the States and you will have, in your 
 next message, the gratification of offering to your fellow-citizens 
 a picture directly the reverse of that which you have now presented.
 
 PRESIDENT OF THE UNITED STATES. 17 
 
 Oar system finds its base in local, and not in central, action. 
 The tendency of almost all the acts of the Federal government, 
 for the last five and twenty years, having been towards the aug- 
 mentation of the central power at the expense of that which is 
 local, the injurious effects become more visible, from day to day 
 human progress, in whatsoever direction, being always one of con- 
 stant acceleration. That such is the case, is clearly shown in the 
 recommendations of the document now before me leading, as 
 they inevitably must, to the entire suppression of the power of 
 the States, in reference to that which you, yourself, regard as one 
 of the most important of governmental duties. A closer exami- 
 nation, and more careful study of the facts here given, would, as 
 I think, have satisfied you, that it is to the centralizing tendencies 
 of recent years, we owe the extraordinary demoralization to which 
 your attention will next be called, by 
 
 Yours, with great respect, 
 
 HENRY C. CAREY. 
 
 Philadelphia, December %5th, 185T.
 
 18 LETTERS TO THE 
 
 LETTER FOURTH. 
 
 STEADINESS and regularity, Mr. President, are the character- 
 istics of advancing civilization. Instability and irregularity, 
 those of advancing barbarism. The first are found, as you have 
 seen, and in a degree that is quite remarkable, in the half century 
 during which the local authorities controlled our banking opera- 
 tions there having been, as has been shown, no instance of 
 general suspension, in that long period, except in 1814, and then, 
 at the instance of the central government ; whereas, in the five 
 and twenty years, in which the local authorities have been, to 
 so great an extent, superseded, the suspensions have been three 
 in number. Need we wonder, then, that " a state of crisis 
 may now," in the opinion of foreign journalists, be regarded 
 as "the normal condition of the great republic of the West?" 
 Assuredly not ! It is the natural result of a centralizing policy, 
 that at one time, urges upon the people the creation of banks, and 
 at another, denounces such institutions as wholly unworthy of 
 credit of a policy that, at one moment, squanders the public 
 property with a view to the extension of railroads, and at 
 another, urges the passage of a special bankrupt law, with a view 
 to secure to the central government, the exclusive control of both 
 banks and roads. 
 
 Instability tends to increase the wealth of the few who are rich 
 while impoverishing the many who look to the sale of labor 
 for the means of obtaining food for their wives, their children, 
 and themselves. It impoverishes the active and useful members 
 of society ; but it enables the idle and the useless to accumu- 
 late fortunes, at the expense of those who make roads, build mills, 
 and open mines, and thus increase the productive powers of labor- 
 ing men. Instability has been, since the central government 
 undertook the regulation of the currency, the essential character- 
 istic of our policy, and hence it is : 
 
 That, notwithstanding grants of land by millions, and tens of 
 millions, of acres, for the construction of railroads, and notwith- 
 standing an unceasing effort to promote the carrying interest, at 
 the expense of the producing one railroads and canals, that 
 have cost $1,000,000,000, have fallen to less than $400,000,000, 
 and their proprietors are ruined. 
 
 That, the factories of the country, too, are in a state of ruin. 
 For years, they have struggled against the tide, but now, the 
 tide has overwhelmed them reducing to a state of poverty, 
 thousands of the men to whose unceasing efforts, we have owed 
 the introduction and perfection of the most useful manufactures. 
 Hundreds of millions have been expended upon the creation of
 
 PRESIDENT OF THE UNITED STATES. 19 
 
 magnificent works, whose value might now be counted by little 
 more than tens of millions. 
 
 That, the machine shops, too, are closed machines not being 
 required, when mills have ceased to work. 
 
 That, the mechanic is now, everywhere, turned adrift, to seek 
 in scratching the soil, the means of support that his trade will not 
 afford him he, and his country, thus losing the use of the 
 capital, of knowledge, he had obtained by means of a long 
 apprenticeship. 
 
 That his daughters, too, are deprived of work, and not unfre- 
 quently, forced to make their election between starvation on the 
 one hand, and prostitution on the other. 
 
 That, mines are closed, and miners are driven to seek employ- 
 ment as common laborers leaving their wives and children to 
 suffer for want of food. 
 
 That, hundreds of little capitalists, who had invested their all 
 in the creation of machinery, for facilitating increase in the supply 
 of fuel, are now in a state of ruin the sheriff selling out their 
 little properties, which are being purchased by the men who are 
 already rich. 
 
 That, furnaces capable of yielding hundreds of thousands of 
 tons of iron, are closed, and their proprietors ruined. 
 
 That, mines of ore, endless in quantity, and capable of supply- 
 ing lead, iron, and copper, to the world, mines, too, that have 
 required vast amounts of capital for their development are idle ; 
 while the men by whom they had been developed, are reduced to 
 poverty. 
 
 That, rolling mills, capable of supplying half the iron required 
 for the Union, are closed to the utter ruin of those who own them. 
 
 That, ships, wholly unemployed, are rapidly accumulating in 
 our ports, while the ships themselves as rapidly decline in value. 
 
 That, while the commerce of the world tends, everywhere, to 
 seek the aid of steam, and while steamers are fast superseding 
 sailing ships, the people of the Union find themselves obliged to 
 depend, almost exclusively, upon the ships of other nations ; and 
 are likely, before the close of your administration, Mr. President, 
 to find themselves without a single ocean steamer, engaged in any 
 trade, in which foreign competition is not, by law, prohibited. 
 
 That, the trade with California, upon which we have hereto- 
 fore relied for supplies of gold, has so far passed away, as to 
 require from us little more than supplies of butter, shoes, boots, 
 and agricultural machines that being all the commerce now 
 resulting, from an expenditure of labor and capital that, had they 
 been applied at home, would have yielded at least a thousand mil- 
 lions a year. 
 
 That railroads and ships, mills and factories, mines and fur- 
 naces, are, thus, involved in one common ruin the depreciation 
 in the value of all this property, being, at the smallest calculation, 
 $1,000,000,000.
 
 20 LETTERS TO THE 
 
 That, the trading interest so long: the almost exclusive object 
 of governmental favor participates in the general ruin. 
 
 That, the owners of houses are unable to collect their rents ; 
 and that, their property declines in value, while the taxes are 
 increased. 
 
 That the farmer finds his consumers declining in number, while 
 his competitors are as rapidly increasing the system of the 
 country tending, as it long has tended, towards forcing into the 
 work of cultivation all who thus far have found, or should have 
 found, employment in mills, machine shops, mines, and furnaces ; 
 and that, he has now before him, should Providence favor him 
 with liberal crops, the prospect of seeing flour at a lower price 
 than has ever yet been known. 
 
 That the planter has before him a reduction in the home de- 
 mand for his commodity, to the extent of 250,000 bales; that, 
 almost simultaneously with this decreased demand, his crop is 
 likely to be four times as much increased : and that, therefore, 
 should he be favored in the seasons, he, too, is likely to see his 
 staple reduced to a price lower than he has ever seen.* 
 
 Taking the probable reduction in the value of land, and 
 in that of slaves, at only $1,000,000,000, and adding it to that 
 in railroads, mills, mines, and furnaces, we obtain the sum of 
 $2,000,000,000. Adding now, thereto, the reduction in the 
 value of real estate, other than farming and planting land, we 
 shall obtain a sum of not less than $2,500,000,000, as the total 
 amount reduced ; and it may be almost twice as much. 
 
 Somebody profits by all this loss. Who is it ? The mortgagee, 
 who enters upon possession first selling out his poor debtor, 
 whether the little farm'er of the West, or the great proprietor of 
 mills, mines, or furnaces in the East. The usurer, who obtains 
 one, two, three, or even five per cent, per month, until the poor 
 borrower is ruined. The government official, whose salaries and 
 perquisites have been already doubled, trebled, and quadrupled, 
 and will be now increased in value, while the working men around 
 him suffer, if even they do not perish, for want of food. The 
 member of Congress, whose salary has been doubled, because of 
 the rise in the price of food, and will so remain, now that its 
 price has fallen. The non-producers are thus enriched, while 
 the men of enterprise, and the laborers, are despoiled. 
 
 * In the four years which followed the bankruptcy of 1841, when specu- 
 lation had ceased, and when all were required to work, the cotton crop was 
 greater by a total of 2,000,000 bales, than in the four previous ones. Nine 
 years since, the crop had reached 2,800,000 bales; and now, with favorable 
 seasons, there exists no reason why it should not attain the quantity of 
 4,000,000 bales. The land is prepared for it, and the people are there to 
 work it. The crop must largely increase, and the European demand must 
 lessen, because, with the decline in the price of food, of which our policy will 
 be the cause, the ability of European farmers to purchase cloth must decline.
 
 PRESIDENT OF THE UNITED STATES. 21 
 
 Turning now to the Treasury, we find it already bankrupt, even 
 at the commencement of this downward movement. Irredeemable 
 paper being now to be substituted for gold and silver, the influx 
 of foreign merchandise, and the efflux of the precious metals, will 
 be much promoted ; and thus will the way be smoothed, towards 
 total bankruptcy, such as was witnessed in 1841 and 1842. 
 
 Such, Mr. President, being the material condition, present and 
 prospective, of your fellow-citizens, we may now, for a moment, 
 turn to their moral one. 
 
 Commencing with the central government and its capital, we 
 find an amount of official corruption not exceeded in the world, 
 outside of the Turkish Empire the affairs of the Union, for 
 the past few years, having been administered with a single eye to 
 the profit of official persons and their friends, and not with refe- 
 rence to the interests of the people. Passing thence, to town, 
 city, and county administrations, we find a continually growing 
 power, on the part of the central government, to control and 
 direct their elections, with correspondent growth of fraud and 
 peculation. 
 
 Turning now to the commercial capital, I find its situation 
 thus described in a journal of the day ; and unfavorable as is the 
 description, none, as I think, can deny its truth : 
 
 " There is no town in Christendom where, in proportion to the 
 population, an equal amount of crime is annually committed. We 
 do not go much beyond the letter of the fact, when we say that 
 murder is a thing here of daily occurrence. Yillanous and das- 
 tardly outrages are nightly perpetrated in the streets, and some- 
 times in the open light of day. The city is the head-quarters of 
 the rogues, thieves and pickpockets that are scattered throughout 
 the country, and is the main theatre of their operations. Nowhere 
 else in this country does vice plant itself so openly, and with such 
 impunity. Nowhere is so much countenance given to rowdy 
 gangs, that keep quiet people in terror. Nowhere have things 
 gone on from bad to worse so rapidly, until it is at length appa- 
 rent that unless some speedy change comes over the police 
 management in New York, and the administration of the criminal 
 courts, a state of anarchy will ensue, or honest citizens will be 
 driven to organize, and take the law in their own hands." 
 
 Passing outward from New York, we find a rapid growth of 
 rowdyism and intemperance, with corresponding decline in the 
 security of person and of property frauds, peculations, seduc- 
 tions, murders, and crimes of every kind, increasing with such 
 rapidity, as fairly to warrant the assertion in a recent Southern 
 journal, that "the United States are fast becoming a very stench 
 in the nostrils of mankind. ' ' * 
 
 * It is useless to wink at the fact. Villany, in every shape, is celebrating 
 its horrid gala-day throughout the United States. Details of murders in our
 
 22 LETTERS TO THE 
 
 Such, Mr. President is the material and moral condition of the 
 people, to the administration of whose affairs you have recently 
 been called. Desiring to find its parallel, you will be led, most 
 naturally, to look to the closing years of the free trade period, 
 which preceded the passage of the protective tariff of 1842. Seek- 
 ing its opposite, you will be led, as naturally, to look to the 
 closing years of the protective periods, established by the tariffs 
 of 1828 and 1842 years, in which the country presented to view 
 a picture of peaceful and quiet progress, such as the world had, 
 theretofore, never seen. 
 
 The tendency towards the establishment of a sound morality, 
 Mr. President, in every country of the world, has been in the direct 
 ratio of the steadiness and regularity of the societary movement 
 the gambling tendencies of the barbaric ages then tending to 
 disappear. That principle being admitted, I would ask you to 
 study the action of the central government, from the day on which 
 it assumed to control the monetary movement of the country, and 
 satisfy yourself, as you readily may, that to its vicious course of 
 action, and not to error in the local governments, we owe the de- 
 moralization that now exists. As a member of the old Federal 
 party, you will, I am sure, rejoice to find this fact established. 
 That you may do so, I would beg you to look to the urgent 
 recommendations of 1835, for the establishment of State banks, 
 
 cities fill the columns of the journals. One reads of butchery until the very 
 letters in the printed columns appear bloody; of arsons, until the light of con- 
 flagration seems to throw its lurid glare throughout the apartment ; of fraud, 
 until a line of sleek, hypocritical, would-be-respectable men range them- 
 selves before us ; and of crimes yet fouler and more bestial, until we tremble 
 lest the lightnings of offended Heaven should descend from a cloudless sky, 
 and overwhelm the earth in ruin." Miner's Journal. 
 
 " Official roguery has been rampant. There are customs prevalent, esta- 
 blished by precedent, and endorsed by long usage, which, if now done for 
 the first time, would be deemed larceny. The eagles are gathering together 
 to-day at the Federal capital, and the jobbing, peculation, vote-yourself-a- 
 prize system, will soon be in full operation. Common usage has given to 
 certain doubtful practices the stamp of legality. He would be regarded as 
 very verdant, and exceedingly unsophisticated, who should presume to call 
 things by their right names in Washington, or to hint that the private gen- 
 tleman who had so wasteful an array of servants, as the servants of the 
 people at Washington, would forthwith discharge the whole set without a 
 character. The treasury, one might think, is replenished annually for the 
 benefit of these gentlemen. That they themselves think so, is palpable. 
 From this centre, the idea of official honesty, in States and municipalities, 
 seems to have taken a like latitudinarian range. The finances of some of 
 our cities are managed in a most unaccountable manner literally unac- 
 countable, for no accounts are rendered. Immense sums disappear, taxation 
 annually increases, and the deficit keeps pace with the sums assessed. The 
 public credit is shaken, municipal evidences of debt are dishonored, neces- 
 sary public works stand still, repudiation is practically attempted, and all 
 this time enough is squandered, and disappears by peculation, to keep 
 the treasury more than ready for the lawful demands upon it." North 
 American.
 
 PRESIDENT OF THE UNITED STATES. 23 
 
 followed by indignant denunciation of both banks and notes, and 
 by the establishment of a department in the national treasury, for 
 the supervision of local banks, from which is issued, annually, an 
 enormous mass of figures, arranged with the intent to deceive their 
 readers into the belief, that those who place confidence in banks 
 will be defrauded. Look, next, to the speculations in public 
 lands, which always follow the adoption of a policy tending 
 towards the closing of our factories and furnaces, and thus 
 enable gamblers and speculators to accumulate fortunes, at the 
 expense of the poor emigrants who are driven from the older 
 States. Look, again, to the enormous changes in the value of 
 property of every description, resulting from the three suspen- 
 sions, in time of peace, that have followed the centralization 
 of the monetary power in the hands of the Federal executive. 
 Look, then, to the facts, that "free trade," the control of the 
 central government over the currency, and the doctrine that "to 
 the victors belong the spoils," had their origin at the self-same 
 period. Further, look to the fact, that an ad valorem system, 
 offering, as it does, a bounty upon the perpetration of fraud, 
 drives the honest merchant from the business of importation. 
 Look, I pray you, to the great fact, that, since the day on which 
 the centralized system was adopted, the expenditures of the 
 government have been quintupled and that nearly seventy mil- 
 lions of dollars, per annum, are now, at every election, put up 
 to the highest bidder. Look at the enormous changes in the 
 prices of all our staples, consequent upon that exclusive depend- 
 ence upon foreign markets, which it is the object of the centralized 
 system to establish. Look at the gambling spirit, and the reck- 
 lessness thereby engendered, and you will be at no loss to account 
 for the demoralization that is in progress a demoralization 
 whose growth has, in the last few years, been more rapid, than in 
 that of any country recorded in the history of the world. Having 
 studied these things, Mr. President, you will, I think, be disposed 
 to agree with me in opinion, that while the central government 
 shall continue to pursue a course that, in effect, offers boun- 
 ties for the perpetration of frauds and villanies, there can be no 
 hope of change ; and that, unless there be a change, the day must 
 speedily arrive, when the people, in their distress, will be found 
 calling upon Providence, in its mercy, to send them a dictator, 
 and thus relieve them from the oppression of that worst of all 
 despotisms, a centralized democracy. 
 
 Hoping, Mr. President, that, under reforms that you may insti- 
 tute, the State authorities may become re-instated in the posses- 
 sion of the powers of which they have been deprived, and that we 
 may thus be enabled to retrieve our reputation, 
 
 I remain, very respectfully, your obed't servant, 
 
 HENRY C. CAREY. 
 
 Philadelphia, December 28th, 1857.
 
 24 LETTERS TO THE 
 
 LETTER FIFTH. 
 
 JUNIUS tells us, Mr. President, that ' ' the ruin or prosperity 
 of a state depends so much upon the administration of its govern- 
 ment, that to be acquainted with the merit of a ministry we need 
 only observe the condition of the people. If," as he continues, 
 "we see them obedient to the laws, prosperous in their industry, 
 united at home and respected abroad, we may reasonably pre- 
 sume that their affairs are conducted by men of experience, abili- 
 ties, and virtue. If, on the contrary, we see a universal spirit 
 of distrust and dissatisfaction, a rapid decay of trade, dissensions 
 in all parts of the empire, and a total loss of respect in the eyes 
 of foreign powers, we may pronounce, without hesitation, that 
 the government of that country is weak, distracted, and corrupt." 
 
 The first of the pictures here presented exhibits the state of the 
 American Union at the close of the war in 1815 ; again in 1834, 
 at the date of the repeal of the protective tariff of 1828 ; and 
 again in 1847, when the act of 1842 ceased to be the law of the 
 land. The second is found on an examination of the condition 
 of the country, in the period from 1818 to 1824, when protection 
 had ceased, and when the legislatures of numerous States had 
 found themselves compelled to stay the action of the laws for the 
 collection of debts; again in 1841-2, when " stay laws " were 
 again resorted to, and when the Federal goverrnment was nearly 
 bankrupt ; and, lastly, at the present period, when there reigns 
 "a universal spirit of distrust and dissatisfaction " when there 
 are "dissensions in every part of the empire" and when the 
 ' ' respect of other powers ' ' has so nearly ceased to have exist- 
 ence. 
 
 In proof that such is the case, and, that the Union is rapidly 
 declining in the estimation of the people of other nations, I beg 
 to offer you the following extract from a work just published, the 
 author of which is not to be suspected of any disposition to mag- 
 nify the changes he discovered : 
 
 "It is very evident, as I converse with people here, and in 
 other parts of Northern Europe, that a great change has come 
 over the popular feeling towards America, since I was last on the 
 Continent, five years ago. Then America was the ideal every- 
 where to free-thinking and aspiring men. The oppressed looked 
 hopefully to it ; the philosopher found the confirmation of his 
 theories of human liberty there ; the hard-working, the politically 
 degraded, the idealists, the struggling masses, felt that the West- 
 ern Republic was especially for them, and even if they could never 
 share its privileges, they were happy that humanity had at length 
 looked on such a glorious effort. The reports of the common
 
 PRESIDENT OF THE UNITED STATES. 25 
 
 freedom, of the education of the masses, of the high morality pre- 
 vailing, came over even exaggerated, and silenced the enemies 
 of popular rights, and converted many doubtful. One felt the 
 effect of all this, as a traveller. You were not alone ; you were 
 the representative of the best thoughts and aspirations of man- 
 kind. The warm hand grasping yours, welcomed not you, but a 
 nation of freemen. The rich did not condemn, because property 
 and person had been better shielded under the Republic, than 
 under European monarchies. The poor, the laborers, were espe- 
 cially your friends, for was not your land the very land which 
 elevated labor ? 
 
 "All this is quite different now. Yon are treated politely, as 
 a stranger ; or you are welcomed more or less for what you per- 
 sonally are, but for your country, among the populace you get no 
 welcome. The glory has departed. 
 
 "Within five years, various circumstances have opened the 
 eyes of Europe to our real situation, and, as often happens, the 
 people see nothing but our sins. We are simply now a tricky, 
 jobbing, half-barbaric people, where the worst political corrup- 
 tion of the Old World extsts without its refinement ; and where 
 brutality, rowdyism, and unlimited despotism have in certain 
 quarters free play. Our politicians and diplomats are despised ; 
 our Constitution is sneered at, as inflicting upon us the most dis- 
 graceful legislators ; and the laboring class and the democrats 
 know that within our limits, a more abominable tyranny over 
 labor and free speech and thought exists, than the worst despot- 
 isms of the Continent ever exhibited. There is nothing now in 
 our situation to dazzle the world. They see with clear eye our 
 blackest sins and our miserable political jobbing." * 
 
 Such being the state of things in Northern, we may now look 
 to Central Europe, in regard to which, I, myself, Mr. President, 
 can speak. Go where the traveller may, he finds, among thought- 
 ful men among those who had hoped to find, in this western 
 world, the realization of their brightest hopes, in regard to man's 
 onward progress a growing doubt in reference to our future. 
 Anxiously do they look across the ocean dreading to hear of 
 new, and more alarming, riots new civil wars new violations 
 of local rights new marauding expeditions new aggressive 
 wars. Ten years since, all was different. They would, then, 
 have regarded as a false prophet, the man who had predicted : 
 
 That, at the close of a single decade, the regular expenditures 
 of the Federal government, in a time of peace, would reach seventy 
 millions of dollars being five times more than they had been, but 
 thirty years before : 
 
 That the recipients of this large amount, whether contractors, 
 clerks, or postmasters, would be held liable for the payment of a 
 
 * Brace." The Norse Folk," page 24.
 
 26 LETTERS TO THE 
 
 formal and regular assessment, to be applied to the maintenance 
 in office, of the men by whom they had been appointed, or those 
 by whom the contracts had been made : 
 
 That payment of these assessments, would be made the condi- 
 tion upon which their own continuance in office should depend : 
 
 That, coincident with these demands upon the employes of the 
 government, all salaries would be largely raised ; and that, thus, 
 the treasury should be heavily taxed for purely party purposes, 
 and for the promotion of private interests : 
 
 That centralization would be so far perfected, as to enable the 
 Executive to dictate to a body of officials, sixty or eighty thousand 
 in number, all their modes of thought, in reference to questions 
 of public interest : 
 
 That a constantly growing difficulty of obtaining independent 
 of the government the means of support, and constant increase 
 in the rewards of public service, would be attended with corre- 
 sponding increase in the number of claimants for office, and in 
 their subservience to the men at whose pleasure offices were held : 
 
 That the Executive would dictate to members of Congress 
 what should be their course, and publicly advertise the offices that 
 were to be given, to those whose votes should be in accordance 
 with his desires : 
 
 That the growing mental slavery thus indicated, would be at- 
 tended by corresponding growth in the belief, that "one of the 
 chief bulwarks of our institutions," was to be found in the physical 
 enslavement of the laborer : 
 
 That the extension of the area of human slavery would have 
 become the primary object of the government ; and that, with that 
 view, the great Ordinance of 1787, as carried out in the Missouri 
 Compromise, would be repealed : - 
 
 That, for the promotion of this object, the treaties with the poor 
 remnants of the native tribes would all be violated : 
 
 That, with the same end in view, wars would be made, piracy 
 encouraged, and territories purchased : 
 
 That the Executive power would so far have grown, as to enable 
 it to adopt measures provocative of war, with a view to the spoli- 
 ation of the weaker neighbors of the Union : 
 
 That it would be officially declared that might makes right, 
 and that, if a neighboring power refused to sell the territory 
 whose possession was desired, the Union would then be justified 
 in seizing it : 
 
 That the reopening of the slave trade would be publicly advo- 
 cated, and that the first step towards its accomplishment would 
 be taken by a citizen of the United States in rescinding all the 
 prohibitions of the Central American governments : 
 
 That the prohibition of slavery in a Central American State, 
 would be considered sufficient reason for the rejection of a treaty : 
 
 That the substitution, throughout all the minor employments
 
 PRESIDENT OF THE UNITED STATES. 27 
 
 of society, of slave labor for that of the freeman, would be publicly 
 recommended by the Executive of a leading State : 
 
 That, while always seeking territory in the South, the rights 
 and interests of the people would be bartered away, for the sole 
 and exclusive purpose, of preventing annexation in the North : 
 
 That it would be declared, that the free navigation of Brazilian 
 rivers was to be obtained, ' ' amicably, if it could, forcibly, if it 
 must": 
 
 That the effect would now be seen, in the entire alienation of 
 the other communities of the Western world : 
 
 That the legislation of the country, would have fallen almost 
 entirely under the control of navigation, railroad, and other 
 transportation companies ; and that legislators would largely par- 
 ticipate with their managers, in the profits of enormous grants of 
 money, and of public lands : 
 
 That there would have arisen a "third house of Congress " 
 composed of lobby members, and embracing men who had filled 
 almost the highest legislative and executive offices abundantly 
 supplied, to use the words of Colonel Benton, "with the means 
 required for conciliating members, and combining interests," and 
 thus securing the passage of almost any bill, the applicants for 
 which were willing, sufficiently liberally, to pay : 
 
 That centralization would so far have grown, as to have caused 
 the expenditures of a single city, to almost equal those of the 
 Federal government, but thirty years ago : 
 
 That the expenditure of city revenues, and the maintenance of 
 public order, would be in the hands of magistrates, many of whom 
 would be regarded as worthy only of the penitentiary : 
 
 That the contest for the distribution of those revenues, would 
 become so fierce, as to cause the purchase of votes to an extent, 
 and at a price, before unknown ; and that elections would be car- 
 ried on by means of bowie-knives, pistols, and even by aid of 
 cannon : 
 
 That Lynch law would have found its way into the Senate 
 chamber : that it would have superseded the provisions of the 
 Constitution, throughout the Southern States : that it would have 
 superseded the civil authority, in one of the States of the Union : 
 that the right of the States to prohibit slavery within their limits, 
 would be so seriously questioned as to warrant the belief, that 
 the day was near at hand, when it would be totally denied : that 
 all the decisions of the Supreme Court, for sixty years, favorable 
 to freedom, would, by this time, have been reversed : that the doc- 
 trine of constructive treason would be adopted in Federal courts : 
 and that the rights of the citizen would be thus in equal peril, from 
 the extension of legal authority on one hand, and the substitution 
 of the law of force on the other : 
 
 That polygamy and slavery would go hand in hand with each 
 other ; and that the doctrine of a plurality of wives, would be pub-
 
 28 LETTERS TO THE 
 
 licly proclaimed by men holding highly important offices under 
 the Federal government : 
 
 That manners, morals, or intellect, would cease to be deemed 
 essential to the representation of the Union, at foreign courts : 
 
 That religious discord would so far have grown, that the ques- 
 tion of the private opinions of a candidate for the presidency, in 
 regard to matters of religious faith, would be discussed through- 
 out the Union : 
 
 That the discord between the Northern and Southern portions 
 of the Union would have reached the point of civil war, attended 
 with a growing disposition, in its various portions, to look com- 
 placently upon the idea of dissolution : and, finally, 
 
 That Germany, divided and distracted as it was, before the 
 formation of the Zoll-Verein, was likely to be reproduced in this 
 Western world the Union tending steadily towards a dissolution, 
 the result of which would be, that the several fragments would 
 become mere tools in the hands of other powers. 
 
 This is a gloomy picture, and yet it is a true one. Not one of 
 these things would, a few years since, have been believed to be of 
 possible occurrence ; and yet, with the exception of this last, they 
 are, one and all, now matters of history. 
 
 How they have tended to the production of changes in the 
 modes of European thought, is exhibited, Mr. President, in a recent 
 British journal, in which, after showing, that the idea of the vote 
 by ballot, of " manhood suffrage," and of "household suffrage," 
 had nearly passed away, the writer proceeds to say that 
 
 " This revulsion of sentiment and opinion is in a great measure 
 traceable to the spectacle of the American democracy. We owe 
 a deep debt of gratitude to the United States for the pregnant les- 
 sons they have taught us, and the timely warnings they have 
 given. * * * A few years ago the substantial, deep-seated, 
 long-descended fabric of English liberty was in danger from the 
 blind but honest enthusiasm of the sincere friends of popular insti- 
 tutions : now, if we succumb to that peril, we shall be wrecked 
 with our eyes open. The tide has somewhat ebbed, and the rock 
 is above water. Let us inquire a little more in detail what the 
 warnings that have come to us across the Atlantic are." 
 
 The time has been, Mr. President, when you and I, and all of 
 us, were accustomed to believe, that the great republic of the 
 West was to be the pillar of light, guiding the oppressed of the 
 world in their search for freedom. Widely different from this, it 
 has, as here is shown, become the beacon light, whose only use is 
 that of warning the world, against the shoals and sands, among 
 which our ship is likely to be wrecked. Turn back, Mr. Presi- 
 dent, a little in our history finding the pages in which are 
 recorded the early efforts of the central power to obtain direction 
 of the currency, and you will, as I think, find the origin of all 
 these changes. From that day to the present one, with slight
 
 PRESIDENT OF THE UNITED STATES. 29 
 
 exceptions, centralization has grown steadily; and yet, strange 
 as it may appear in a patriot like yourself, the whole tendency of 
 your message, is in the direction of further centralization. 
 
 The more perfect the form of the ship, the more rapid will be 
 her passage through the water, and the more certainly and 
 speedily will she, under proper guidance, reach her destined port. 
 The more rapid and complete, however, will be her destruction, 
 should her pilot run her upon the rocks that lie in her course 
 the reaction then produced, being in the direct ratio of her pre- 
 vious action. So is it with nations. The higher their organiza- 
 tion, the more rapid is the movement of society, and the more 
 instant is the shock that attends a stoppage in the circulation. 
 The passage of an invading army through Peru, or Mexico, pro- 
 duces little effect, beyond a small destruction of life and property ; 
 but a similar event in England, would cause the closing of fac- 
 tories, the stoppage of mills and furnaces, the abandonment of 
 mines, the dispersion of the people, and the suspension of all the 
 machinery of local government. The power of recuperation 
 exists, however, in the same degree the recovery from the 
 effects of war, in countries like France or England, being much 
 more rapid than it can be, where the societary circulation is lan- 
 guid, and where the waste of property, or of population, can 
 slowly, if even at all, be repaired. 
 
 In no country of the world, do the effects of change become 
 so promptly obvious, as among ourselves ; and for the reason, 
 that the political organization being here more natural than in 
 any other the tendency to rapidity of circulation is so very great. 
 Universal instruction throughout the northern portion of the Union, 
 tends to the production of great mental activity ; and, whatever 
 may be the direction in which the ship of State is guided, the 
 movement towards the rocks on the one hand, or the haven on 
 the other, is here most rapid. Such being the case, it is easy to 
 account for the sudden and extraordinary changes, that are here 
 exhibited, and, that so much surprise the people of other lands. 
 In the decade that followed the passage of the tariff of 1824, 
 there was effected a greater improvement than had ever before 
 been witnessed in any country the people having passed from a 
 state of poverty to one of wealth the country having become so 
 attractive, as to cause, in the following years, a vast increase of 
 immigration and the government having passed from a condi- 
 tion in which it required, for its support, to borow money, to 
 one in which the public debt having been extinguished it 
 became necessary to emancipate from duty all the commodities 
 that did not enter into competition with those produced at home. 
 Nevertheless, but seven years later, the people and the govern- 
 ment, both, were bankrupt ; the circulation of society had almost 
 stopped ; and pauperism, to an extent that was alarming, pre- 
 vailed throughout the country. The cause of this was to be
 
 30 LETTERS TO THE 
 
 found in the fact that protection had been abandoned. Again, 
 in 1842, the system was changed; and, before the close of the 
 first five years, the whole appearance of the country was changed 
 the circulation of society having become rapid, the credit of 
 the people and the government having been restored, and the 
 country having once more been rendered so attractive as to cause 
 a large increase of immigration. Again, at the close of 1846, 
 was the system changed protection having been then aban- 
 doned, and free trade then again inaugurated into power ; and 
 now, at the close of the first decade, we witness a decline more 
 rapid, and more pervading, than is recorded in the history of any 
 country of the world. 
 
 Why it is, that such are the effects produced, will be shown in 
 another letter, from 
 
 Yours, very respectfully, 
 
 HENRY C. CAREY. 
 
 Philadelphia, December 30th, 1857.
 
 PRESIDENT OF THE UNITED STATES. 
 
 31 
 
 LETTER SIXTH. 
 
 BEFORE proceeding, Mr. President, to an examination of the 
 manner in which the policy of the central government has tended 
 towards producing the demoralization, that has now become so 
 clearly manifest, I would beg to call your attention to a simple, 
 but highly important, principle of social science, which may thus 
 be stated : 
 
 A thousand tons of rags, at the Rocky Mountains, would not 
 exchange for a piece of silver of the smallest conceivable size ; 
 whereas, a quire of paper would command a piece so large, that 
 it would weigh an ounce. Passing thence eastward, and arriving 
 in the plains of Kansas, their relative values, measured in silver, 
 would be found to have changed so much, that the price of the 
 rags would pay for many reams of paper. Coming to St. Louis, 
 a further change would be experienced rags having again risen, 
 and paper having again fallen. Such, too, would prove to be 
 the case, at every stage of the progress eastward the raw ma- 
 terial steadily gaining, and the finished commodity losing, in price, 
 until, at length, in the heart of Massachusetts, three pounds of 
 rags would be found to command more silver than would be 
 needed for the purchase of a pound of paper. The changes of 
 relation thus observed, are exhibited in the following diagram : 
 
 Paper. 
 Cloth. " 
 
 Rags 
 Cotton. 
 
 Paper. 
 Cloth. 
 
 
 
 Massachusetts. 
 
 Hags. 
 Cotton. 
 
 The price of raw materials tends, thus, to rise, as we approach 
 those places in which wealth most exists those in which man is 
 most enabled to associate with his fellow-man, for obtaining 
 power to direct the forces of nature to his service. The prices of 
 finished commodities, move in a direction exactly opposite 
 tending, always, to decline as those of raw materials advance. 
 Both tend, thus, to approximate the highest prices of the one, 
 being always found in connection with the lowest of the other ; 
 and, in the strength of the movement in that direction, is 
 found the most conclusive evidence of advancing civilization, 
 and growing commerce. 
 
 The tendency towards advance in civilization being thus, Mr.
 
 32 
 
 LETTERS TO THE 
 
 President, everywhere, in the direct ratio of the approximation 
 of the prices of the rude products of the earth, and those of the 
 commodities into which they are converted, the test of the value 
 of every measure, is to be found in its tendency to produce, or to 
 prevent, that approximation. So examined, the protection ex- 
 tended to shipping, would appear to have been productive of un- 
 mixed good ships having steadily become cheaper, while ship- 
 limber has as steadily become dearer ; and the farmer having 
 found freights declining from year to year, while a market was 
 being made for portions of his trees, that, otherwise, would have 
 been wholly valueless. 
 
 With regard to the products of the labor given to cultivation 
 that labor which, when properly directed, tends most to expand 
 the mind and improve the heart it has been otherwise ; and be- 
 cause, the policy of the country has looked almost entirely to 
 foreign trade, to the exclusion of all measures tending to the pro- 
 motion of internal commerce. The prices of raw material have 
 steadily declined ; and, for the reason, that the obstacles to com- 
 merce have increased, when they should have diminished. 
 
 The average export price of flour, since the commencement of 
 the present century, has been as follows : 
 
 Five years ending in 
 
 1805 
 
 1810 
 
 1815 
 
 1820 
 
 1825 
 
 1830 
 
 1835.... 
 
 Dollars. 
 .. 9.05 
 . 7.50 
 ,.11.60 
 ,. 9.15 
 .. 6.20 
 .. 6.20 
 ,. 5.70 
 
 Five years ending in Dollars. 
 
 1840 7.87 
 
 1845 5.00 
 
 1850 5.54 
 
 Year 1850 5.00 
 
 1851 4.77 
 
 " 1852 4.24 
 
 The facts here presented, being most remarkable, are worthy, 
 Mr. President, of your most serious attention. The highest 
 average is found in the period from 1810 to 1815 ; that one, in 
 which there was, almost literally, no intercourse with foreign 
 countries ; and that, in which the energies of the country were, 
 more than they ever before had been, directed towards the estab- 
 lishment of internal commerce.* A domestic market was then 
 rapidly being created, the extent of which may be judged from 
 the fact, that the cotton manufacture, which, in 1805, had required 
 but a single thousand bales, absorbed, in 1815, no less than 
 90,000.t 
 
 * In the last of these years, only, it was, that gold and silver coin had 
 ceased to circulate, because of difficulties resulting from the events of the 
 war. The stoppage took place in the autumn of 1814, and the Treasury 
 year closes with the autumn of 1815. That, however, was one of the 
 lowest years of the period. 
 
 ( Report of the Committee of Commerce and Manufactures, February 13, 1816. 
 The effect of this large domestic demand, upon the price of cotton, is shown
 
 PRESIDENT OF THE UNITED STATES. 33 
 
 With the return of peace, however, the policy of the country 
 was changed, and from the date of that change, we have an 
 almost unbroken descent, until, in 1852, just prior to the opening 
 of the Crimean war, it had reached the lowest point of the cen- 
 tury ; and probably the lowest recorded in the country's history 
 
 thus proving a constant increase in the obstacles standing be- 
 tween the man who raised the wheat, and him who had money 
 with which to purchase it. Directly the reverse of this, is what 
 \ve see to have occurred in France, where the average price of 
 wheat for thirty-five years, ending with 1848, remained almost 
 stationary, although somewhat higher in the closing period than 
 in the earlier ones. So, too, with both Russia and Northern 
 Germany, in the first of which, the price of corn, in the decade 
 ending in 1852, was one-half higher than it had been, in that 
 ending in 1825 ; while in the last, we find the average maintained 
 with a steadiness contrasting strikingly, with the extraordinary 
 changes occurring among ourselves, as here is shown : 
 
 Average of wheat Average of flour 
 
 in Prussia, per scheffel.* exported from U. S. 
 
 1816-25 66{| groschen = $1.48 $7.57 
 
 1826-35 55^ " = 1.23 5.95 
 
 1836-45 62^ " = 1.39 6.43 
 
 1845-51 78 T 9 T " = 1.63 5.41 
 
 1852 ' 68/5 ' = L51 4 - 24 
 
 In the one, the price, towards the close, is higher than in the 
 preceding periods ; while in the other, it has fallen to little more 
 than half. 
 
 The course of events in the advancing countries of Europe 
 those which are following in the lead of Colbert, and of France 
 
 is, therefore, exactly the opposite of what is here observed ; 
 but if we seek a case that is exactly parallel, it will be found in 
 studying the operations of Ireland or India, Portugal or Turkey 
 countries which follow in the lead of England. In all of these, 
 the prices of raw products, and those of finished commodities, 
 are steadily receding from each other, with constant decline in the 
 value of land ^and man, and constantly augmenting difficulty in 
 obtaining the food and clothing required for man's support. 
 Like these United States, they are becoming from year to year 
 more dependent upon foreign trade, and less able to maintain 
 commerce among themselves. 
 
 Turning now, Mr. President, to the England of a century 
 since, we find a precisely similar state of facts, and resulting, too, 
 
 by the fact, that the average value of the cotton exports of 1815 and 1816 
 exceeded $24,000,000; whereas, three years later, when the domestic manu- 
 facture had almost disappeared, it sunk to $20,000,000. Treasury Report, 
 February 20, 1836. 
 
 * A scheffel is 1 y 5 ^ bushels, 
 o
 
 34 LETTERS TO THE 
 
 from causes precisely similar a growing dependence on distant 
 markets, attended with increased necessity for the use of machi- 
 nery of transportation ships and wagons, sailors and wagon- 
 drivers. The price of wheat fell there, regularly, until, at length, 
 it reached the very low point of 21s. od. per quarter, or little 
 more than half a dollar a bushel manufactures remaining high 
 in price. So soon, however, as a market had been made at home, 
 the price rose nearly doubling in the very first decade, and fur- 
 ther advancing to an average of 51s. 3d. ; at or near which point, 
 it remained for fivc-and-twenty years. Cloth and iron, during all 
 that time, were becoming cheaper thus presenting, in the con- 
 stant approximation of prices, the most unquestionable of all the 
 evidences of advancing civilization. 
 
 The whole quantity of food for which Great Britain then needed 
 a foreign market was trivial to a degree the average export in 
 the decade ending in 1755, when the price was lowest, having 
 been only 4,000,000 of bushels; and yet, small as it was, the 
 necessity for going abroad to sell it, produced the whole of the 
 effect above described. The regulating market of that day, having 
 been the country on the Rhine then the great seat of manufac- 
 tures the more that was sent to it, the lower was there the price, 
 and the lower that which could be obtained at the place of pro- 
 duction. The 4,000,000 of bushels thrown upon that market 
 must have caused a reduction there, of not less than 10, and more 
 probably 15, per cent. ; and that reduction extended itself to the 
 whole British crop, whatever was its size. So soon, however, 
 as a market had been made at home, British corn ceasing to go 
 abroad ceased to affect the prices of foreign markets ; and then 
 British prices rose to the extent we see them to have done, because 
 of the double saving to the farmer from the diminution in the cost 
 of transportation, and from the increase of prices in all the mar- 
 kets of Continental Europe, from which supplies might otherwise 
 have been drawn. The amount of that saving, probably, was 
 $100,000,000 ; and it was the effect of an increase in the rapidity 
 of the societary circulation effected, in the short space of twenty 
 years, by the very simple process of bringing the consumer to the 
 side of the producer. 
 
 Look where we may, Mr. President, we find, that men become 
 more civilized, as the prices of raw materials tend to rise, and to 
 approximate more nearly to those of the finished commodities 
 required for man's consumption. Such being the fact, and our 
 policy tending steadily in the reverse direction, you can readily 
 account for the daily growing tendency, among ourselves, towards 
 centralization and slavery, with their attendant demoralization. 
 For further facts in reference to this great question, I must, how- 
 ever, refer you to another letter. 
 
 Yours, with great respect, 
 
 HENRY C. CAREY. 
 
 Philadelphia, January 1st, 1858.
 
 PRESIDENT OF THE UNITED STATES. 35 
 
 LETTER SEVENTH. 
 
 No truth in science, Mr. President, is more readily susceptible 
 of demonstration, than that of the liability of the man who must 
 go to market, for the payment of the cost of getting there. It is 
 one, which sad experience teaches every farmer; and one, too, 
 that the student may find demonstrated by Adam Smith. The 
 corn that is twenty or thirty miles distant from market, sells for 
 as many cents less, per bushel, than that which is close to mar- 
 ket ; and the potatoes that are a hundred miles from market, are 
 almost worthless ; while those raised near it, sell for thirty or forty 
 cents a bushel the difference between the two, being the tax of 
 transportation. 
 
 Another and equally important truth is, that the price of the 
 whole crop is dependent upon that which can be obtained for the 
 little surplus that must go abroad ; or paid, for the small quantity 
 that must be brought from a distance. Give to any certain dis- 
 trict 10,000 bushels of wheat, more than is there required, and 
 the crop will fall to the level of the price that can be obtained 
 abroad, for those few bushels although constituting, perhaps, 
 but 3 per cent, of the whole. Let the same district, in the fol- 
 lowing year, require 10,000 additional bushels, and the whole will 
 rise to the level of the price at which they can be obtained the 
 difference between the two being, perhaps, as follows : 
 
 Admitting the crop to be 300,000 bushels, and that the price, -when 
 
 there is neither surplus nor deficiency, is $1 the product is. $300,000 
 
 The crop being larger, and a surplus requiring to be sent to a dis- 
 tance, the price will fall to 75 cents giving for 310,000 
 bushels 232,500 
 
 The crop being small, and 10,000 bushels being required from a 
 
 distance, the price will be $1.25 giving for 290,000 bushels. 362,500 
 
 The question here, between a high and a low price differing 
 to the extent of 66f per cent. is dependent, altogether, upon the 
 existence of a demand slightly below, or above, the quantity pro- 
 duced. The former was the condition of the people of Great 
 Britain, at the period referred to the supply having been 
 slightly in excess of the demand, and that excess compelling them 
 to go to a distant market, with some 2 or 3 per cent, of the crop, 
 the price received for which, fixed the price of all. They, them- 
 selves, too, were constantly aiding in the depression of prices in 
 that market, and the more they sent the less they obtained for it. 
 So long as the prices in the home market were regulated by
 
 36 LETTERS TO THE 
 
 those in the foreign one, it would have been more profitable to 
 them, to have thrown the surplus into the oceaii than to have 
 sold it. 
 
 Identical with this, is now the condition of the American 
 farmer; and therefore it is, that while the price of food the 
 raw material of labor is steadily rising in France, Denmark, 
 Germany, Spain, and Russia, it here as steadily declines. Simi- 
 lar, too, is their condition in this, that the whole quantity for 
 which a foreign market must be found, is so small that, were it 
 altogether wasted, the loss would be unfelt. Its waste, indeed, would 
 be productive of great advantage to the farmer ; for, so long as 
 all domestic prices are fixed by foreign markets, the effect of this 
 trivial export, in crushing the foreign farmers, by a reduction of 
 their prices, is accompanied by corresponding reduction of the 
 domestic ones the loss thence arising, extending itself to the 
 whole of the food produced. 
 
 The total amount of food of all descriptions, exported from the 
 United States, and the prices of flour at the corresponding dates, 
 have been as follows : 
 
 Period. Ayerage export. Price of flour. 
 
 1821-15 $13,000.000 $6.20 
 
 1826-30 12,000,000 6.20 
 
 1831-35 14.000,000 5.95 
 
 1830-40 12,500,000 8.00* 
 
 1841-45 16,000.000 5.16 
 
 1846-50 39,000,000 (Irish famine) 5.44 
 
 1850 26,000,000 5.00 
 
 1851 22,000.000 4.73 
 
 26,000,000 4.24 
 
 We have, here, a constantly growing necessity for resorting to a 
 distant market, accompanied by a decline of prices amounting to 
 35 per cent. ; but, if we compare 1850-52 with the period from 
 1810 to 1815, when the home consumption was equal to the whole 
 supply, the reduction is no less than 63 per cent. Admitting, how- 
 
 * The facts of the last three years correspond precisely with those which 
 occurred in the period from 1836 to 1840, when the price of flour, for the 
 moment, ranged so high, preparatory to the great fall that was so soon after 
 to take place. Then, as now, mills and furnaces had ceased to be built. 
 Then, as now, emigration to the West was immense, and the combined force 
 of the nation was being given to the creation of new machinery for pro- 
 ducing food. Then, as now, production diminished, while consumption was 
 maintained the deficiency being made up by the contraction of debts to 
 Europe, for an immense amount of cloths and silks, the power to pay for 
 which had no existence. Then, as recently, there was great apparent pros- 
 perity, as preparation for the universal bankruptcy of 1841-2. The prepa- 
 ration now being made is similar in all its parts ; and as the causes are the 
 same, we may be assured that the effects will not be different.
 
 PRESIDENT OF THE UNITED STATES. 37 
 
 ever, that the prices of 1821-25 would be the standard, in the 
 event of the creation of a domestic market, that would relieve the 
 farmer from the necessity for going abroad, we obtain the result, 
 that the same crops which now sell for $1,500,000,000 would then 
 command $2,200,000,000 making a difference of $700,000,000, 
 which may be regarded as the actual price paid by the agricul- 
 tural body, for the privilege of almost giving away food, to the 
 extent of $26,000,000. 
 
 The prices above given, are those of the ports of shipment, 
 always greatly higher than those of the places of production. 
 Were we now to add the saving of inland transportation, that 
 would be consequent upon the creation of local markets, the dif- 
 ference would reach $1,000,000,000 ; and this, too, when taking 
 as the standard the prices of 1821-25, embracing years of almost 
 universal distress throughout America and Europe. Were we 
 to take the average of 1816-25 $7.67 it would reach 
 $1,500,000,000. The average of all France for every decade 
 of the last forty years, has exceeded 18 francs for the hectolitre of 
 wheat being the equivalent of $1.25 per bushel; and the later 
 periods are the highest of all ; whereas, they are here the lowest. 
 The French average of the six years ending in 1852, for all 
 France, must have been 50 per cent, greater than the average of 
 those years for the whole of this country ; and yet, all that was 
 required for bringing prices here to a level with those abroad, was 
 the creation of a market for food to the extent of $26,000,000 
 being less than 2 per cent, of the total product. To those who 
 doubt this, it can be necessary only to say, that the differences 
 here stated as likely to occur, correspond exactly with those 
 that did occur in England, in the period between 1750 and 1770. 
 Commerce then growing, and the circulation becoming rapid, the 
 dependence on the trader diminished every stage of that dimi- 
 nution being marked by an increase in the value of labor and 
 land. Here, on the contrary, the dependence on ,the trader 
 steadily increases ^ every stage of its increase being marked by 
 a decline in the price of food, by which the price of land and labor 
 must ultimately be regulated. 
 
 It may, however, Mr. President, be said, that the food con- 
 sumers would suffer by such a course of operation. Directly the 
 reverse of this, however, has been the case in all other countries ; 
 and so would it be with us. At no period of England's history, 
 have the evidences of growing civilization, as furnished by the 
 approximation of the prices of raw materials and finished pro- 
 ducts, been so great, as in the five-and-thirty years preceding the 
 opening of the wars of the French Revolution ; and at none, has 
 the condition of the people so much improved. Circulation 
 became from year to year more rapid. Labor was from year to 
 year more economized ; and as the power of accumulation is
 
 38 LETTERS TO THE 
 
 wholly dependent upon such economy, it followed, necessarily, 
 that wealth most rapily augmented. Land and man, in that 
 period, almost doubled in value ; and all because of the relief 
 from the tax of transportation, resulting from the growth of com- 
 merce. So, too, in France. At no period in the last two cen- 
 turies, has corn been so low in price as in the days of Louis XV. ; 
 and yet, at none, have the people so much suffered from the want 
 of food. Commerce then had scarcely an existence. Since then, 
 the price has rapidly increased enabling the farmer to gain on 
 both hands : first, by obtaining more money for his corn ; and, 
 second, by obtaining more cloth for his money. Farm wages 
 rise ; and with that rise, there is, necessarily, a constant augmen- 
 tation of wages in every other pursuit it being only by tempt- 
 ing the people of the. country, to come to the towns, that factories 
 can obtain supplies of labor. Desiring, then, to ameliorate the 
 condition of man, we must begin with the laborer on the land 
 his wages being the standard by which all others are to be com- 
 pared ; and that by which they are regulated. The more close 
 the approximation of the prices of raw materials and finished 
 commodities, the higher will be the wages, and the greater the 
 tendency towards civilization. 
 
 As it was in England, and as it is now in France, so would it 
 be among ourselves. The work of making a market for the food 
 that is now exported, would make a demand for muscular and 
 mental force enabling each and every man to sell his services, 
 and to purchase those of the people around him. Labor being 
 in demand, its price would rise ; and the more rapid the rise, the 
 more it would be economized ; the greater would be the power 
 of accumulation ; the more abundant would become the machinery 
 required for enabling him to call the forces of nature to his aid ; 
 the larger would be the proportion of the mental and physical 
 force of the community given to developing the treasures of the 
 earth ; and the larger would be the reward of labor, in food and 
 clothing. Commerce would then grow rapidly, but the power 
 of the foreign trader would, then, as much decline precisely as 
 we see to have been the case in both France and England, at the 
 periods above referred to. 
 
 The proposition, that civilization grows in the direct ratio of 
 the removal of obstacles standing between the producer and the 
 consumer, and the consequent approximation of the prices of the 
 products of the earth in their rude and finished forms, is a great 
 and universal law, to which no exception can be found. Being 
 so, it follows, necessarily, that raw materials should rise in price 
 as finished commodities are cheapened; that civilization should 
 advance with the advance in the price of those materials ; and 
 that that civilization should exhibit itself in the form of increased 
 power of combination, increased development of individuality, in-
 
 PRESIDENT OF THE UNITED STATES. 39 
 
 creased sense of responsibility, and increased power of progress. 
 Thus far, the policy of the Union, as we have seen, has tended 
 in an opposite direction towards lessening steadily the price of 
 food ; and as such progress tends inevitably towards barbarism, 
 it is here we find the fundamental cause of the extraordinary 
 demoralization, now so rapidly in progress. In another letter, 
 Mr. President, I propose to show, that the facts in regard to 
 the great staple of the South are precisely the same as those 
 above described. 
 
 Yours, very respectfully, 
 
 HENRY C. CAREY. 
 Philadelphia, January th, 1858.
 
 40 LETTERS TO THE 
 
 LETTER EIGHTH. 
 
 TURNING now southward, Mr. President, we may look to our 
 other great staple, COTTON, with a view to see if the course of 
 operation has been the same. That it has been so, you may 
 readily be satisfied. 
 
 The crop of 1814 was estimated at 70,000,000 of pounds, of 
 which more than 8,000,000 were converted into cloth in the coun- 
 try within thirty miles of Providence the total domestic con- 
 sumption having amounted to 90,000 bales, or nearly 30,000,000 
 of pounds. In the seven years following, the crop rose succes- 
 sively to 106,000,000, 124,000,000, 130,000,000, 125,000,000, 
 167,000,000, and 160,000,000; but the home manufacture as 
 steadily declined producing a constantly increasing necessity for 
 pressing upon the foreign market, with results such as are here 
 exhibited : 
 
 Export 1815 and 1816 average 80,000,000 total price $20,500.000 
 
 " 1821 and 1822 134,000,000 " 21,500,000 
 
 " 1827 to 1829 " 256,000,000 " " 26,000,000 
 
 The quantity, as we see, had more than trebled, while the 
 receipt therefor, had increased but little more than 25 per cent. 
 The prices here given, being those of the shipping ports, and the 
 quantity to be transported having so much increased, and having 
 required so great an extension of cultivation, it is, I think, rea- 
 sonable to assume, that the planter in those years gave 256,000,000 
 of pounds receiving, in exchange, no larger amount of money 
 than, six years previously, he had received for less than a third 
 of that quantity. 
 
 1830 to 1832 average, pounds, 280,000,000 $28,000,000 
 
 1840 to 1842 " 619,000,000 55,000,000 
 
 1843 to 1845 " 719,000,000 51,000,000 
 
 We have, here, an addition to the quantity of 1815-16, amount- 
 ing to no less than 630,000,000 of pounds, and requiring nine 
 times the amount of inland transportation even admitting that 
 the area of cultivation had remained the same. We know, how- 
 ever, that, in that period, it had quadrupled, and must have re- 
 quired fifteen, if not even twenty times as large a force of men, 
 horses, and wagons, to do the work. Allowing for this, Mr. 
 President, you will readily see that the planter must, in these 
 years, have been giving 700,000,000 of pounds, for less than 
 twice the quantity of money that, thirty years before, he had 
 received for 80,000,000. 
 
 1849 pounds, 1,026,000,000 $66,000,000. 
 
 Here we have nearly 940,000,000 to be transported, additional
 
 PRESIDENT OF THE UNITED STATES. 4l 
 
 to those of 1815-16 ; and from an area of cultivation that, because 
 of the unceasing exhaustion of the soil, had been again enormously 
 extended.* Such being the case, it may well be doubted, if the 
 actual quantity of money, or money's worth, that reached the 
 planter, in exchange for these 1,034,000,000, was much more than 
 twice as great as that his predecessors had received for 80,000,000. 
 Making the smallest allowance for additional transportation, he 
 was here giving three pounds, for the same money that before 
 had been received for one. 
 
 1850-1851 average, pounds, 781,000,000 $92,000,000 
 
 The great fact is here presented, that the less cotton the 
 planter sends to the foreign market, the more money he re- 
 ceives. In this case, there is a saving of internal transportation, 
 as compared with 1849, upon 245,000,000 pounds, and an in- 
 crease of gross receipt, amounting to $26,000,000. Allowing 
 for the additional freight, as compared with 1821, the producer 
 was now not giving more than two pounds, for the price received 
 before for one. 
 
 1852 pounds, 1,093,000,000 $88,000,000. 
 
 * The following paragraph is from a speech of a distinguished citizen of 
 Alabama, and exhibits the action of the system in a State that but forty 
 years since had no existence : 
 
 "I can show you, with sorrow, in the older portions of Alabama, and in 
 my native county of Madison, the sad memorials of the artless and exhaust- 
 ing culture of cotton. Our small planters, after taking the cream off their 
 lands, unable tp restore them by rest, manures, or otherwise, are going fur- 
 ther West and South in search of other virgin lands, which they may and 
 will despoil and impoverish in like jnanner. Our wealthier planters, with 
 greater means, and no more skill, are buying out their poorer neighbors, ex- 
 tending their plantations, and adding to their slave force. The wealthy few, 
 who are able to live on smaller profits, and to give their blasted fields some 
 rest, are thus pushing off the many who are merely independent. Of the 
 twenty millions of dollars annually realized from the sales of the cotton crop 
 of Alabama, nearly all, not expended in supporting the producers, is re-in- 
 vested in land and negroes. Thus, the white population has decreased, and 
 the slave increased almost pari passu, in several counties of our State. In 
 1825, Madison County cast about 3000 votes ; now, she cannot cast exceed- 
 ing 2300. In traversing that county, one will discover numerous farm- 
 houses, once the abode of industrious and intelligent freemen, now occupied 
 by slaves or tenantless, deserted, and dilapidated ; he will observe fields, 
 once fertile, now unfenced, abandoned, and covered with those evil harbin- 
 gers, foxtail and broomsedge ; he will see the moss growing on the moulder- 
 ing walls of once thrifty villages, and will find ' one only master grasps the 
 whole domain" that once furnished happy homes for a dozen white families. 
 Indeed, a country in its infancy, where, fifty years ago, scarce a forest tree 
 had been felled by the axe of the pioneer, is already exhibiting the painful 
 signs of senility and decay apparent in Virginia and the Carolinas." C. C. 
 Clay.
 
 42 LETTERS TO THE 
 
 Here is an increase, in the quantity requiring to be transported, 
 amounting to more than 300,000,000 pounds, accompanied by a 
 diminution of gross receipt, amounting to $4,000,000; and a 
 diminution of net receipt, that cannot be estimated at less than 
 $10,000,000. As compared with 1815-16, the planter must, here, 
 have been giving five pounds, for the price he before had received 
 for one. 
 
 The course of things, above described, is without a parallel in 
 the history of the world. In the natural order of affairs, the cul- 
 tivator profits by improvements in the machinery of conversion, 
 his products rising in their prices, as the finished commodities fall 
 rags becoming dearer, as paper becomes cheaper and wool 
 going up, as cloth goes down. Here, however, all is different. In 
 the forty years above referred to, each and every one has brought 
 with it some improvement in the modes of converting cotton into 
 cloth, until at length the labor of a single person is more pro- 
 ductive than that of four or five had been before ; and yet, so far 
 are those improvements from having been attended with any in- 
 crease of price, that we find the planters giving steadily more and 
 more cotton for less money and thus affording the most conclu- 
 sive proof of a tendency towards barbarism. 
 
 The cause of all this being, as we are told, that too much cot- 
 ton is produced, the planters hold meetings with a view to reduc- 
 tion in the quantity ; and yet, from year to year, the crop grows 
 larger; the area, over which it requires to be grown, becomes 
 more and more extended ; and the net proceeds decline in the 
 proportion they bear to the population of the States in which it 
 is produced. In 1815, that population amounted to 2,250,000, 
 whereas, in 1850, it exceeded 6,000,000. In the first, the gross 
 proceeds of 80,000,000 pounds were $20,500,000; whereas, in 
 1849, 1,026,000,000, with all the vast increase of freight, were 
 given for $66,000,000 ; and the total gross proceeds of the crop 
 could but little have exceeded $80,000,000. Struggle as the 
 planters may, the case is still the same they being required to 
 give, from year to year, more cotton for less money ; and that, too 
 in defiance of a great natural law, in virtue of which, they should 
 have more money for less cotton. 
 
 We are thus, Mr. President, presented with the remarkable 
 fact, that the two chief products of the Union are steadily decli- 
 ning in their power to command money in exchange ; and that, 
 so far are the farmer and planter from dividing with the consumer 
 of their products, the advantages resulting from improved machi- 
 nery of transportation and conversion, that the latter gets it all, 
 and more the former obtaining less money, the more produce 
 he has to sell. 
 
 It is asserted, however, that all this is in strict accordance with 
 some great law, in virtue of which every thing tends to become 
 cheaper; but a brief examination of the general movement of
 
 PRESIDENT OF THE UNITED STATES. 43 
 
 prices will probably satisfy you that the only law with which it is 
 in accordance, is that human one, denounced by Adam Smith 
 having for its object the cheapening of the raw products of the 
 earth, the establishment of the supremacy of trade, and the reduc- 
 tion of man to the condition of a mere instrument to be used by 
 the trader ; or, in other words, to that of a slave. 
 
 In England, the price of sheep's wool has doubled in the last 
 eighty years ; and that, too, notwithstanding the extraordinary 
 extent to which cotton, in that period, has been substituted for 
 wool. Had there been any commodity whatsoever, by which the 
 theory of reduction of prices could have been supported, this 
 would certainly have been the one ; and yet, the facts are directly 
 opposed thereto. In France, too, wool has greatly risen. In 
 Germany, it is now so much higher than it was thirty years since, 
 that that country has become a great importer, where, formerly, it 
 was a large exporter of this commodity. Looking next tp silk, 
 we find the following remarkable illustration of the great law 
 that lies at the foundation of all human progress. In the Re- 
 port on the Commerce and Navigation of France, we have the 
 official value, established about thirty years since, of all the com- 
 modities exported and imported, side by side with their actual 
 value, and are thus enabled to study the changes that are now 
 going on, and measure their extent. How great they are, 
 and how precisely they move in the direction that has been 
 indicated, is shown in the fact, that while sewing -silks have 
 fallen from 95 to 53 francs per pound, cocoons have risen from 
 3 to 14 francs. 
 
 Turning now to Mr. Tooke's valuable table of prices, in the 
 period from 1782 to 1838, and taking the first and last decades 
 thereof, we obtain the following results : 
 
 1782 to 1701. 1829 to 1838. 
 
 Bristles percwt. Q Us. OOrf. 15 12. 0<W. 
 
 Flax per 9 head 1 7 00 2 3 10 
 
 Oil per ton 40 00 00 48 00 00 
 
 Butter percwt. 2 10 10 3 16 00 
 
 Irish mess-beef ...per tierce 3 10 10 4 18 00 
 
 Tallow percwt. 2 1 00 1 19 6 
 
 Timber, fir per load 2 4 00 2 8 00 
 
 Whalebone per ton 150 00 90 215 00 00 
 
 In all these cases, the producer was profiting by the increased 
 facilities of transportation and conversion obtaining larger prices 
 lor all he had to sell, with constant increase in his power to im- 
 prove his own machinery, and thus augment the quantity pro- 
 duced; whereas, in those of flour and cotton, he is seen to have 
 been receiving smaller prices, with constant diminution of quan- 
 tity, resulting, as will be shown, from the constant exportation 
 of the elements of which flour and cotton are composed.
 
 44 LETTERS TO THE 
 
 We are told, however, that in the case of cotton, decline of 
 price is the necessary consequence of a growth in the supply 
 exceeding the wants of the world ; and therefore it is, that the 
 planters hold meetings, for the purpose of devising measures tend- 
 ing to the limitation of the quantity to be grown. In so doing, 
 however, they are only repeating the operation performed at an 
 earlier period in Virginia, in reference to tobacco ; and thus it is, 
 that like causes produce like effects. The real difficulty, Mr. Pre- 
 sident, is now, as it then was, to be found in the total absence of 
 diversification of employments producing a necessity for un- 
 ceasing waste of labor, and unceasing exhaustion of the soil, 
 accompanied by a destruction of the value of the land, and of the 
 man by whom it is cultivated. That such is certainly the case, 
 Mr. President, I propose to furnish further evidence, in another 
 letter, remaining meanwhile, 
 
 Yery respectfully, 
 
 Yours, 
 
 HENRY C. CAREY. 
 Philadelphia, January 6th, 1858.
 
 PRESIDENT OF THE UNITED STATES. 45 
 
 LETTER NINTH. 
 
 THE reduction in the price of flour, and of cotton, is not, as 
 you, Mr. President, have seen, in accordance with any general 
 law. On the contrary, it is in direct opposition to a great law 
 whose existence is everywhere manifest. Neither is the reduction 
 in the price of cotton a consequence of any excess in the quantity 
 produced, as you will be satisfied when you reflect, that the total 
 quantity produced in the world does not equal two pounds per 
 head ; whereas, the quantity that should be used, cannot be 
 limited to ten, or even twenty, pounds per head. Such being the 
 case, the difficulty, it is clear, does not lie in the excess of pro- 
 duction, but in the deficiency of consumption. Could thexcause 
 of this deficiency be discovered, and a remedy be applied, the 
 planter might go on increasing his quantity from year to year 
 the price of his cotton steadily rising, and that of cloth as steadily 
 falling, precisely as we see to be the case with rags and paper, 
 cocoons and silks, sheep's wool and cloth, flax and linen. 
 
 The larger the price of corn, the greater must be the power of 
 the farmer to purchase cloth, and the greater the quantity of 
 money obtainable by the planter in return for any given quantity 
 of cotton. The tendency of American policy, however, is towards 
 reducing the price of corn throughout the world ; and, as a neces- 
 sary consequence, towards destroying the power of the people of 
 France and Germany, Russia and Austria, England and Ireland, 
 to purchase cloth. That such is the case, will be obvious to you, 
 Mr. President, when you shall have reflected, for a moment, upon 
 the effect that is now so obviously produced, by an increase in 
 our export ; and upon that which would be produced, were it 
 possible at once to say, that no more food would go from America 
 to any country of the world we having followed the advice of 
 Adam Smith, when he advised that tons of food should be com- 
 bined with wool, so as to enable both to travel cheaply to distant 
 lands. Such a measure would, at once, relieve the European 
 market from the pressure by which it is now kept down, and the 
 price of English and Irish food would rapidly advance afford- 
 ing inducement to the extension of cultivation, and making demand 
 for labor, with large increase of wages, and consequent increase in 
 the power to purchase cloth. German food and German land 
 would rise, and so would those of France and Russia, Austria 
 and Spain. Agriculture thus receiving a new impetus, agricul- 
 tural labor would rise in price rendering indispensable an in- 
 crease in the wages of factory labor. What is needed throughout 
 the world is, rapidity of circulation, making demand for labor 
 and its products. Centralization is opposed to this producing
 
 46 LETTERS TO THE 
 
 stagnation everywhere, and compelling the planters of the world 
 to give n constantly increasing quantity of their commodities 
 Miir'ur and cotton for a constantly diminishing quantity of 
 money. Nearly all the countries of Europe having followed in 
 the lead of France, in the effort to produce decentralization, the 
 effect is seen, in the rise that has there taken place, in the prices 
 of food and wool. 
 
 Such would be the effect, among ourselves, of the adoption of 
 the policy that, there, has been productive of such results. The 
 measures required for making a domestic market for food thus 
 relieving the farmers of Europe from American competition 
 would produce rapid circulation of labor and commodities, and the 
 American farmer would soon obtain as much for his corn, as is paid 
 in France or England. The rise in the price of agricultural labor 
 would be followed by rise in that which was otherwise employed. 
 Labor becoming from day to day more productive, at the close of a 
 few brief years, the domestic consumption of cotton would be thrice 
 as great as now, with corresponding diminution in the quantity 
 pressing on the market of Europe enabling the planter to obtain 
 for large crops a higher price, per pound, than he now receives 
 for small ones. 
 
 Adam Smith denounced the British system of his time, because 
 of its being based upon the idea of cheapening all the raw mate- 
 rials of manufacture labor and the products of the land. The 
 system of the present day looks to the production of the same 
 results ; and therefore is it, that, in accordance with the ideas of 
 Dr. Smith, it has been resisted by all the civilized nations of the 
 world America alone excepted. In all of them, consequently, 
 raw produce is rising in price, while here, alone, is found a civi- 
 lized community, in which the produce of the land has steadily, 
 during half a century, declined in price the farming and plant- 
 ing interests having been most consistent, in the pursuit of a policy 
 tending to diminish the quantity of money to be received, in ex- 
 change for a bale of cotton, or a barrel of flour. 
 
 The evidences of growing civilization, Mr. President, are to be 
 sought in two directions : first, in the rise in the prices of the raw 
 products of the earth ; and, second, in the decline in those of the 
 manufactured commodities required for human purposes. So far 
 as regards the first, that evidence has not been here obtained 
 both flour and cotton having steadily fallen in price, to the great 
 disadvantage of those by whom they are produced. The manu- 
 factured commodity that, more than any other, is required by the 
 farmer and the planter, is IRON, and we may now turn to it, with 
 a view to ascertain if we can find in that direction, the evidence of 
 growing civilization with which, thus far, we have failed to meet. 
 Doing so, we ascertain that, in 1821 and 1822, the average price 
 of bars at Glasgow, was 10 14s., or $51.36, a ton, at which rate 
 the 100,000,000 of pounds of cotton then shipped would have
 
 PRESIDENT OF THE UNITED STATES. 47 
 
 paid for, at that port, about 450,000 tons leaving $3,500,000 
 to defray the inland expenses of sending the cotton to the port of 
 shipment. Turning now to the four years ending in 1855, we find 
 that the average price of bars has been $38.50 per ton, and- that 
 the quantity of cotton that has been shipped, has averaged 
 1,050,000,000 pounds, producing at the port of shipment an ave- 
 rage of $94,500,000 deducting from which, the inland expenses, 
 the planters might have received, probably, $80,000,000, with which 
 they could have purchased about 2,100,000 tons thus giving ten 
 pounds for a smaller quantity of iron, than, before, they could have 
 had for five. 
 
 The price of flour, prior to the opening of the Crimean war, was 
 lower, as, Mr. President, you have seen, than it had been for half a 
 century ; and less, by nearly one-half, than it had been in the period 
 from 1815 to 1825. In that period, the price of bar iron in Liver- 
 pool averaged about 10 ; or but little more than that of the past 
 four years the fluctuations in these latter having been between 
 7 10s. and 9 12s. Qd. The raw materials of labor food and 
 cotton not only do not approximate towards iron, but become 
 more widely separated from year to year. 
 
 Still more strongly is this the case, when we compare the prices 
 of food and cotton, with those of other metals. The raw mate- 
 rials, iron and lead, have fallen in actual price, but copper and tin 
 have both advanced, as will be seen by the following figures, de- 
 rived from the work of Mr. Tooke, before referred to : 
 
 1782 to 1791. 1829 to 1838. 
 
 Copper per cwt. 4 la. 2d 4 8s. Id. 
 
 Tin per cwt. 413 4 4 10 
 
 Lead per 19 cwt. 19 3 18 300 
 
 Turning next to the year 1852, at which time flour had fallen 
 to little more than a third of the price at which it sold in the 
 period from 1810 to 1815, we find that the average prices had still 
 further advanced copper having been 4 18s. tin, 4 fs. 
 and lead, 11. 
 
 The whole value of these metals, is in the labor given to their 
 extraction. That labor is the product of food and clothing 
 of corn and wool. The foreign raw materials, of which British 
 labor is composed, are perpetually falling in price, while highly 
 important commodities, received by the foreign producers in ex- 
 change, as regularly rise ; and that being the direct road to- 
 wards centralization, barbarism, and slavery, we may now readily 
 understand the causes of the existence of the extraordinary demo- 
 ralization now in progress among ourselves. The road to free- 
 dom and civilization, lies in a direction precisely the opposite 
 of that which, thus far, has been pursued. That road is, under 
 the lead of France, being travelled by all the advancing nations 
 of Europe, and hence the improvement that becomes from day to
 
 48 LETTERS TO THE 
 
 day more manifest in the growing harmony of all the various 
 interests of which society is composed. The contrary road is, 
 under the guidance of England, travelled by Ireland and India, 
 Portugal and Turkey, as well as these United States ; and hence 
 it is, that in all of them we see an increasing centralization and a 
 constantly growing discord. Hence, too, it is, that in the land 
 whence issued the Declaration that all men were born equal, it is 
 now openly declared that "free society has proved an utter failure," 
 and that bondage is the natural condition of the man who labors, 
 be he white or black. 
 
 The history of the Union, Mr. President, is an enigma our 
 words having been those of civilization and freedom, while our 
 tendencies, with only occasional intervals, have been in the di- 
 rection of slavery and barbarism. That such has been the case, 
 was obvious to yourself, when you told your fellow-citizens, in 
 your recent message, that, "for more than forty years, the history 
 of the country has been one of extravagant expansions in the 
 business of the country, followed by ruinous contractions. At 
 successive intervals," as you continued, "the best and most enter- 
 prising men have been tempted to their ruin by excessive bank 
 loans of mere paper credit, exciting them to extravagant importa- 
 tions of foreign goods, wild speculations, and ruinous and demo- 
 ralizing stock-gambling." 
 
 That such, Mr. President, have been the facts, cannot well be 
 questioned. "At successive intervals," we have abandoned the 
 policy whose admirable effects in reducing the cost of transporta- 
 tion, and thus diminishing the taxation of the farmer and the 
 planter, were so well illustrated by Adam Smith, when he showed 
 how cheaply the cotton and the wool could be carried to the re- 
 motest parts of the earth, after having been combined in the form 
 of a piece of cloth; and, in each and every one of those periods, 
 we have seen precisely the phenomena you so well describe. 
 Numerous banks having, then, been created, we have had "extra- 
 vagant expansions," followed by "ruinous contractions." Enor- 
 mous importations of foreign goods have been followed by the 
 wildest speculations, and by the most "ruinous and demoralizing" 
 gambling in stocks and public lands. At other intervals, ajl this 
 has disappeared the societary movement having become so quiet 
 and tranquil, that successive years have passed without the 
 slightest speculation. Inquiring, now, what have been those 
 years, we find them to have been those in which the policy of the 
 country being in accordance with the ideas of Adam Smith 
 tended towards relieving the planter and the farmer from the 
 tax of transportation. 
 
 Such, Mr. President, having been the uniform results of change 
 in the policy of the central government, the solution of the enigma 
 may, as it- appears to me, be found by any one who will carefully 
 study the following simple proposition : Barbarism grows in the
 
 PRESIDENT OF THE UNITED STATES. 49 
 
 ratio of the export of the rude products of the land, and conse- 
 quent exhaustion of the soil. Civilization grows in the ratio of 
 the ability to diminish the bulk of the products of the plantation 
 and of the farm, and to restore to the soil the refuse of its pro- 
 ducts thus augmenting the productive power of the land, and 
 enabling more and more people to live together. In which of 
 these directions we are to move, is dependent, Mr. President, upon 
 the central government, and not upon the local ones, as you have 
 seemed to think. Such being the case, it must be to modification 
 in the action of the former, we must look for a diminution of these 
 barbaric tendencies, to whose existence you have so properly 
 called the attention of your constituents. That modification 
 once obtained, each successive day will tend to add to our admi- 
 ration of the men who, when employed in making the Constitution, 
 so wisely left to the States the regulation of their local institu- 
 tions, whether engaged in converting wool and food into cloth, 
 or in aiding the exchanges of those who desired to borrow money, 
 with those who had money to lend. 
 
 Trusting that you will become convinced of this, I remain, 
 Mr. President, 
 
 Yours, very respectfully, 
 
 HENRY C. CAREY. 
 Philadelphia, January Sth, 1858. 

 
 50 LETTERS TO THE 
 
 LETTER TENTH. 
 
 CIVILIZATION, Mr. President growing with the growth of 
 wealth is indicated by improvement in the condition of man. 
 Our condition, natural, moral, and political, having much dete- 
 riorated within the last few years, it is needed that we seek the 
 causes of the change, which must be found in diminution of our 
 wealth. 
 
 Wealth, Mr. President, consists in the power to control and 
 direct the forces of nature resulting, first, from the possession of 
 the necessary machinery, and next, from the possession of the 
 knowledge how to guide it. The coal that is mined by a single 
 man, is capable of doing as much work, as could be done by 
 thousands of human arms. The power of steam employed in 
 Great Britain, is estimated as being equal to the united forces 
 of 600,000,000 of men; and yet, the total number of persons 
 employed in the coal-mines of that country, is but 120,000, 
 two-thirds of whom must be engaged in furnishing fuel for the 
 smelting' of ore, for the rolling of iron, and for household and 
 other purposes. The entire population of the island, in 1851, was 
 under 21,000,000, each one of whom, were the power thus acquired 
 equally divided, would have the equivalent of nearly thirty willing 
 slaves employed in doing his work slaves, too, requiring neither 
 food, clothing, nor lodging, in return for the service thus performed. 
 Admitting that even so large a number as 60,000, were employed 
 in the extraction of the fuel by which this power is supplied, it 
 would give but 1 in 350 of the population, and less than 1 in 200 
 of those who are capable of doing a full day's work. Such being 
 the case, we obtain the remarkable result that, by means of com- 
 bination of action, less than one-half of one per cent, of the adult 
 population, is enabled to furnish fifty times more power than 
 could be supplied by the whole number, were each man laboring 
 by himself. 
 
 To enable this fuel to do the work, it is, however, required, that 
 man should play the part of engineer substituting mental power 
 for the physical force, that would otherwise be required. The engi- 
 neer must have his engine, and for the production of engines there is 
 needed a portion of the labor that, by their use, is to be economized. 
 How small, however, is the proportion thus required, is seen from 
 the fact, that the whole number of steam-boiler makers in Great 
 Britain, in 1841, was but 3479 ; and, as the total number of per- 
 sons engaged in making steam-engines cannot be ten times greater, 
 we thus obtain less than 35,000 as being so employed. Adding 
 now together the miners and engine-makers, we obtain less than 
 100,000 as the total human force given to the development of a
 
 PRESIDENT OF THE UNITED STATES. 51 
 
 natural one equal to 600,000,000 the physical force of each 
 being, thus, by means of association and combination, multiplied 
 no less than six thousand times. 
 
 Of all the communities of the world, there is none, Mr. President, 
 at whose command has been placed an amount of power, at all to 
 be compared with that of our Union the quantity of fuel within 
 their reach being, practically, as unlimited as is the air we breathe. 
 It underlies a large portion of Pennsylvania, Maryland, Virginia, 
 and North Carolina, while, throughout the regions of the West, 
 it so much abounds as, in a great majority of cases, to be wholly 
 valueless. So, too, with the material of which steam-engines are 
 composed iron ore the supplies of which are boundless in 
 extent, and waiting only for the moment when we shall deter- 
 mine to appropriate them to our use, and thus acquire wealth. 
 To what extent it might be so acquired, is shown by the fact, that 
 a single hundred thousand men, in Britain, furnish power, equal 
 to more than sixty times the mere muscular force of the whole 
 adult male population of the Union.* 
 
 To produce, among ourselves, the same effect, it is required, 
 only, that we adopt the same measures that have there resulted 
 in such a wonderful increase of force ; and thus do we arrive at 
 the great fact, that by means of the proper direction of the labors 
 of the one-hundredth part of the adult population of the Union, 
 the power, or wealth, of the whole, might, in a brief period, be 
 twenty times increased each and every person, were the whole 
 equally divided, being thus supplied with twenty slaves employed 
 in furnishing fuel and food, clothing and lodging, while consuming 
 no part, whatsoever, of the products of their labor. 
 
 The treasures of nature are boundless in extent, the earth being 
 a great reservoir of wealth and power requiring for their full 
 development only the carrying into full effect the idea expressed 
 by the magic word, ASSOCIATION. That such is the fact, is seen 
 in every case in which, because of local circumstances, our 
 people find themselves enabled to combine their efforts for the 
 
 * The question may, with great propriety, be asked "If power really is 
 wealth, why is it that the people of England, with such a wonderful amount 
 of wealth at command, are so poor as to have given rise to the idea of over- 
 population ? " The answer is, that all this power is being wasted in the 
 effort to prevent the other communities of the world, from acquiring similar 
 power, or wealth. While laboring to cheapen the labor and raw materials 
 of the exterior world, she is enslaving the people of all countries subject to 
 her influence, and thus producing the enslavement of her own. The harmony 
 of interests being everywhere perfect, therefore it is, that every measure 
 tending to deprive the Hindoo of the power to sell his labor, tends equally 
 to lessen the ability of the British laborer to obtain food for his family and 
 himself. Action and re-action are equal and opposite the ball which stops 
 the motion of another ball, being stopped itself. This is a great physical 
 law, whose truth is obvious throughout the whole range of social science. 
 Common sense, common honesty, and sound policy, look always in the same 
 direction.
 
 52 LETTERS TO THE 
 
 accomplishment of some common object. Combination of action 
 furnishes to every resident of New York, Philadelphia, or Boston, 
 a slave employed in supplying him with water, or with light, at a 
 cost so trivial as to be utterly insignificant, when compared with 
 what it would be, were he obliged to live and labor alone, as did 
 the emigrants of the days of William Penn. Combined effort 
 enables us to pass from the shores of the Atlantic, to the banks 
 of the Mississippi, in fewer hours, and at less expense, than 
 but a few years since, were required for going from New York to 
 Washington. To such effort it is due, that every child is supplied 
 with instruction, such as would be wholly unattainable by the soli- 
 tary settler. Combination of effort furnishes Bibles at a price so 
 small, as to place them within the reach of the poorest person in 
 the Union ; and it supplies, for two cents, a better newspaper than 
 could, but a few years since, have been purchased at any price. 
 To combination it is due, that the man of New Orleans can com- 
 municate on the instant with his friend in Philadelphia thus 
 annihilating both time and space. 
 
 Look where we may, Mr. President, we find new proofs of the 
 advantage to be derived from association ; and yet men are every- 
 where seen flying from their homes, and leaving behind them wives 
 and children, parents and relatives each one seeming desirous, as 
 far as possible, to be compelled to roll his own log, build his own 
 house, and cultivate his lonely field ; and thus deprive himself of all 
 the benefit necessarily resulting from combination with his fellow- 
 men. In the passage to his solitude, he traverses immense plains 
 abounding in the fuel by whose consumption he would so much 
 increase his wealth and power preferring, apparently, to continue 
 to confine himself to the use of his arm, when, by calling nature to 
 his aid, he might be enabled to substitute the qualities of his head 
 for those of his arm, and pass from the labors of the ox to those 
 
 Of THE MAN. 
 
 In no country of the world, is there so great a voluntary waste of 
 power as in these United States. In Ireland and India, in Turkey 
 and Portugal, a similar waste takes place, but in none of these, 
 is there even a pretence that the people direct their own course of 
 action. Here, the reverse is the case, every man being supposed 
 to constitute a portion of the government, and to aid in so directing 
 its action as to enable him and his neighbors most to profit by the 
 gifts of Providence ; yet, here it is, that men are most disposed 
 to separate themselves, each and every one from each and every 
 other thus forfeiting all the advantages, that are elsewhere 
 seen to result from the substitution of the natural forces, for those 
 of the human arm. The waters of Niagara, capable of doing the 
 work of millions of men, are allowed to run to waste ; and the 
 coal-fields of Illinois, that, with the slightest effort, might be made 
 to perform a hundred times more labor than is now performed by
 
 PRESIDENT OF THE UNITED STATES. 53 
 
 all the people of the Union, are held in almost as light esteem as 
 would be a similar quantity of gravel, or of sand. 
 
 Domestic commerce tends to the development of the treasures 
 of the earth to the utilization of every particle of the matter of 
 which our planet is composed to the development of human 
 power to diminution in the value of the commodities required 
 for the support of man and to augmentation in his own value, 
 and in that of the land upon which he is placed. At every stage 
 of its progress, local centres acquire a larger attractive power 
 the mill, the mine, the furnace, the rolling-mill, and the grist and 
 cotton mills, becoming the places of exchange, and thus diminish- 
 ing the necessity for resorting to the trading cities of the world. 
 The man whose labors have been given to the production of wheat, 
 is thus enabled to exchange directly with one neighbor who con- 
 verts wheat into flour, and another who has changed coal and 
 ore into iron ; with one who has converted wool into cloth, and 
 another who has made rags into paper at once economizing the 
 cost of transportation, and obtaining the intellectual commerce 
 required for enabling him to pass from the cultivation of the poor, 
 to that of the richer soils. 
 
 The desires of the trader look in an opposite direction tend- 
 ing, everywhere, to prevent the creation of local centres, and thus 
 to increase the necessity for resorting to the great central cities 
 of the world. Every stage of his progress towards power is, 
 therefore, attended by an increase in the tax of transportation, 
 and a diminution in the power of man with constantly increasing 
 exhaustion of the soil, requiring resort to new lands, to be in their 
 turn exhausted. 
 
 According to an eminent French economist, this country is, 
 like Poland, specially dedicated to agriculture, to the exclusion 
 of manufactures. Such, too, having been the opinion of some 
 of those persons who most have influenced the action of the cen- 
 tral government, the result is seen in an universal impoverishment 
 of the soil, and of its owners, because of the enormous tax of trans- 
 portation to which they have been subjected. According to these 
 gentlemen, the raising of raw produce is the chief pursuit of man, 
 and yet, small reflection could be required for satisfying them, 
 that the raising of wheat was but one of the steps towards the 
 making of bread ; and that the raising of cotton was but a stage 
 in the process of producing cloth cloth and bread, and not wheat 
 or wool, being the commodities required for his use. Men perish 
 of cold where trees most abound, because of the absence of the 
 saw, or the axe ; and other men go naked, though surrounded by 
 plants yielding cotton, because of their distance from the spinning- 
 jenny and the loom. Man is placed on this earth to subject the 
 forces of nature to his service compelling her to yield the com- 
 modities required for his use, and in exchange for the smallest
 
 54 LETTERS TO THE 
 
 possible amount of human effort. That that otject may be accom- 
 plished, he is required to combine his efforts with those of his 
 fellow-men the farmer, the miller, and the baker, uniting for the 
 production of bread ; the shepherd, the spinner, and the weaver, 
 uniting for the production of cloth. The more perfect that 
 union, the less is the waste of labor in transportation and in effect- 
 ing exchanges, and the greater the power to improve the land 
 already occupied, while extending the work of cultivation over the 
 richer soils as is now being done in France, Denmark, Germany, 
 and other of the advancing countries of Europe. The less the 
 power of combination, the greater is the tendency to exhaustion 
 of the soil, as is seen to be the case in Poland and Ireland, 
 Turkey and Portugal, Jamaica and India, and every other country 
 that, like the United States, gives itself, almost exclusively, to the 
 work of scratching the earth. Of all the raw material required 
 for the purposes of man, manure is the most important, and the 
 least susceptible of transportation to a distance ; and therefore is 
 it, that poverty, depopulation, and slavery, are the necessary 
 consequences of the reduction of a community to dependence on 
 the single species of effort required for compelling the earth to 
 yield the raw material of clothing, or of food. Throughout the 
 larger portion of the Union, the market is distant hundreds and 
 thousands of miles, and the consequences are seen in the fact, that 
 the soil is becoming almost everywhere exhausted wealth thus 
 diminishing, when it should increase. 
 
 How it diminishes, has recently been shown by an eminent agri- 
 culturist, from whom we learn : 
 
 That, the potash and phosphoric acid annually taken from the 
 land, is worth, at the usual market price of these commodities, 
 nearly $20,000,000 scarcely any of which is ever returned : 
 
 That, the ashes of 600,000,000 of bushels of corn are annually 
 taken from the soil scarcely any of which are ever returned : 
 
 That, the total annual waste of the mineral constituents of food, 
 is "equal to 1,500,000,000 bushels of corn." 
 
 " To suppose," says the author of these estimates "to sup- 
 pose that this state of things can continue, and we, as a nation, 
 remain prosperous, is simply ridiculous. We have as yet much 
 virgin soil, and it will be long ere we reap the reward of our 
 present improvidence. It is merely a question of time, and time 
 will solve the problem, in a most unmistakable manner. What 
 with our earth-butchery and prodigality, we are each year losing 
 the intrinsic essence of our vitality. 
 
 " Our country has not yet grown feeble from this loss of its 
 life-blood, but the hour is fixed when, if our present system con- 
 tinue, the last throb of the nation's heart will have ceased, and 
 when America, Greece, and Home, will stand together among the 
 ruins of the past.
 
 PRESIDENT OF THE UNITED STATES. 55 
 
 "The question of economy should be, not how much do we 
 annually produce, but how much of our annual productions is 
 saved to the soil. Labor employed in robbing the earth of its 
 capital stock of fertilizing matter, is worse than labor thrown 
 away. In the latter case, it is a loss to the present generation 
 in the former, it becomes an inheritance of poverty for our suc- 
 cessors. Man is but a tenant of the soil, and he is guilty of a 
 crime when he reduces its value for other tenants who are to come 
 after him." 
 
 Waste, such as is here described, Mr. President, is a crime, and 
 it finds its punishment in the natural, moral, and political decline, 
 to which your attention has now been called. Look, almost, 
 where the traveller may, he is struck with the wretched condition 
 of that which, in this country, is called agriculture but which, 
 in the civilized countries of Europe, would be denominated pure 
 and simple robbery of the great bank, given by the Creator for 
 the use of man. Its effects are shown in the facts, that, in New 
 York, where, eighty years since, 25 to 30 bushels of wheat wer* 1 
 an ordinary crop, the average is now only 14, while that of Indian 
 corn is but 25. In Ohio, a State that, but half a century since, 
 was a wilderness, the average of wheat is less than 12 ; and it dimi- 
 nishes, when it should increase. Throughout the West, the pro- 
 cess of exhaustion is everywhere going on the large crops of the 
 early period of a settlement, being followed, invariably, by smaller 
 ones in later years. In Virginia, throughout a large district of 
 country once considered the richest in the State, the average of 
 wheat is less than seven bushels ; while in North Carolina, men cul- 
 tivate land yielding little more than that quantity of Indian corn. 
 Tobacco has been raised in Virginia and Kentucky, until the 
 land has been utterly exhausted and abandoned ; while through- 
 out the whole cotton-growing country, we meet with a scene of 
 exhaustion unparalleled in the world, to have been accomplished 
 in so brief a period. The people who raise cotton and tobacco 
 are living upon capital selling their soil' at prices so low, that 
 they do not obtain one dollar for every five destroyed ; and as 
 man is* always a progressive animal, whether his course be up- 
 ward or downward, we may now readily understand the cause 
 of the steady and regular growth of that feeling which leads to 
 regarding bondage as being the natural condition of those who 
 need to sell their labor. The supremacy of trade leads necessa- 
 rily to such results ; and, as the whole energies of the country are 
 given to the enlargement of the trader's power, and to the aug- 
 mentation of the tax of transportation, it is no matter of sur- 
 prise that its people are everywhere seen to be employed in 
 " robbing the earth of its capital stock." Let the existing system 
 be continued, and "the hour is surely fixed," when, in the words 
 of the writer quoted above, "America, Greece, and Rome, will 
 stand together among the ruins of the past."
 
 56 LETTERS TO THE 
 
 Allow me now, Mr. President, to call yonr attention, once again, 
 to the diagram given in a former letter. Looking at it, you find, 
 at the left, production small, and the prices of the ruder products 
 of the earth, very low indeed. Passing towards the right, you 
 find, in Massachusetts, production larger, and prices higher the 
 farmer obtaining a greater number of bushels, and, for each bushel, 
 a larger quantity of money. That is the road towards the im- 
 provement in manners and morals, to which we attach the idea 
 of civilization. The contrary road from the right to the left 
 is the one which leads to that state of demoralization, to which 
 we attach the idea of barbarism the products of the earth then 
 diminishing in quantity, with steady decline of prices. This last, 
 Mr. President, is the road which, under the guidance of the cen- 
 tral government, we are travelling ; and therefore it is, that each 
 successive year brings with it new attacks upon the local powers, 
 and new increase of the central power, with constant decline in 
 the respect for the Constitution, and in the regard for individual 
 rights. Men, Mr. President, become free, and communities rise 
 in the estimation of the world, in the ratio of their development 
 of a real agriculture. Both deteriorate in the ratio in which 
 they find themselves driven to the work of robbing the soil. 
 This I propose to show in another letter remaining, meanwhile, 
 
 Yours, very respectfully, 
 
 HENRY C. CAREY. 
 Philadelphia, January \lth, 1858.
 
 PRESIDENT OF THE UNITED STATES. 57 
 
 LETTER ELEVENTH. 
 
 . 
 
 ALL raen, Mr. President, desire to maintain commerce with 
 each other exchanging ideas and services, or commodities, in 
 which those services are embodied. Some men desire to be 
 employed in effecting exchanges for other men standing be- 
 tween them, in the various capacities of sailor and wagoner, 
 trader and transporter, all of whom are merely instruments to be 
 used by commerce. 
 
 The greater the diversity in the employments of society, the 
 greater is the power to maintain commerce, and the less is the 
 necessity for the use of the instruments above referred to the 
 greater is the tendency towards increase in the productiveness of 
 the soil the larger is the return to agricultural labor the higher 
 are the prices of the rude products of the land the cheaper 
 become those finished commodities required for the use of the 
 farmer and the greater is the tendency towards that improve- 
 ment of human condition, to which we are accustomed to attach 
 the idea of civilization. 
 
 The less, Mr. President, the diversity of employments, the 
 greater is the necessity for the services of the ship and the wagon, 
 the trader and transporter the less is the commerce the 
 greater is the tendency towards exhaustion of the soil the 
 smaller is the return to agricultural labor the lower are the 
 prices of the rude products of the land the dearer are clothing, 
 knives, axes, and other finished products and the greater is the 
 tendency towards that deterioration of man's condition to which 
 we are accustomed to attach the idea of barbarism. 
 
 The great fact is thus presented to us, that where the land 
 yields most largely, there the prices of the products of the farm 
 are highest ; whereas, where it yields 'least in quantity, there the 
 prices are lowest. In Germany and Prance, the yield of the 
 land is steadily increasing, while prices regularly advance. In 
 this country, the yield decreases, while prices as steadily decline. 
 Hence it is, Mr. President, that the phenomena presented to view 
 by French and German society, are those of growing civilization ; 
 while those we meet among ourselves, are those of advancing 
 barbarism. 
 
 Approximation in the prices of the rude products of the earth, 
 and of the finished commodities required for human purposes, is, 
 Mr. President, the most conclusive proof of growth in civilization. 
 The more nearly they come together, the more does society 
 tend to assume its natural form the greater is the tendency 
 towards steadiness and regularity of movement and the more 
 rapid is the advance in wealth, and power. The more they recede
 
 58 LETTERS TO THE 
 
 from each other, the more does society tend to take the form of 
 an inverted pyramid, the less is the regularity of movement, the 
 greater is the tendency towards barbarism, and the more rapid is 
 the decline in wealth and power. With us, as you have seen, those 
 prices do recede more cotton and more flour being, as a rule, 
 required to pay for any given quantity of iron, copper, tin, or 
 lead the most essential of the commodities required for advance 
 in civilization than was needed, for that purpose, half a cen- 
 tury since. 
 
 The closer that approximation, the greater is everywhere the 
 tendency to increase in the productiveness of the soil with 
 growing power of association and combination. The more re- 
 mote they are, the greater is the tendency towards exhaustion of 
 the soil, with declining power of combination. Throughout the 
 Union, that power is declining ; and thus are we presented with 
 another of the phenomena which, everywhere else, have attended 
 declining civilization. 
 
 The more the soil becomes enriched, the greater is its power 
 of attraction, the more rapid is the growth of commerce, and the 
 more civilizing are the tendencies of the time. The more it is 
 impoverished, the greater is its repulsive power, the slower be- 
 comes the movement of society, and the more rapid is the decline 
 of civilization. With us, Mr. President, as you have seen, the 
 attractive power of the soil diminishes, and men are almost every- 
 where flying from each other, as if from pestilence the enormous 
 emigrations of the barbarous ages of Europe being here repro- 
 duced, and affording conclusive evidence of decline in wealth, 
 strength, and power. What are the lesser phenomena by which 
 decay is manifested, and how they influence the various portions 
 of society, we may now inquire. 
 
 At the return of peace in 1815, land was high in price a 
 market having been already made at home, for the most important 
 of its products. Protection being discontinued, that market dis- 
 appeared, and the result was seen, six years later, in the almost 
 universal ruin of the farmers judgments being everywhere en- 
 tered up mortgages being foreclosed sheriffs' sales abound- 
 ing to such an extent as, at length, to force the people of the 
 agricultural States to the adoption of laws for staying the execu- 
 tion of the judgments of their courts and land falling to a fourth 
 of the price at which it had sold, but seven years before. The 
 sales of public land, and the revenue therefrom, had trebled in 
 the period from 1814 to 1818-19 thus increasing the number 
 of farmers, at the moment when the market for their products was 
 gradually disappearing and thus preparing the way for that 
 decline in the price of the products of the farm, whose steady 
 progress is exhibited in the figures already, Mr. President, laid 
 before you. 
 
 By 1824, the land revenue had fallen to less than a third of the
 
 PRESIDENT OF THE UNITED STATES. 59 
 
 amount at which it had stood in 1819. Thenceforward protec- 
 tion having been re-established it went gently up, until, in 1832 
 and 1833, it averaged $3,295,000 ; or, almost precisely the amount 
 it had so suddenly attained thirteen years before. In the mean 
 time, the population had increased about two-thirds ; and so 
 regular had been the increase in the home demand for food, that 
 now, for the first time in the country's history, its price was 
 wholly uninfluenced by the fall of foreign markets. From 1828 
 to 1831, wheat, in England, had been high averaging 3 4s. 3d. 
 per quarter, or $1.72 per bushel. From that period, it fell regu- 
 larly, until, four years later, it was but 1 19s. 4rf. , or $1.05 per 
 bushel ; and yet, the price of flour in the American ports remained 
 entirely unaffected ; as is shown by the following figures, derived 
 from a recent Treasury Report : 
 
 Average of 1828 to 1831 $5.84 
 
 1832 $5.87 1834 $5.50 \ K 79 
 
 1833 5.50 1835 6.00 / 
 
 The Compromise tariff having now, however, begun to operate, 
 mills ceased to be built, and importations rapidly increased. The 
 mechanic arts no longer affording an outlet for the growing popu- 
 lation, emigration to the West grew rapidly, accompanied by 
 enormous speculations in the public lands the speculator always 
 desiring to go in advance of the poor settler, and to profit at his 
 expense. The land revenue rose from $4,000,000 to $14,000,000, 
 and $24,000,000; after which, for four succeeding years, it ave- 
 raged $5,000,000 ; and thus, in six years, was more land disposed 
 of, than had been sold in the forty preceding ones. The conse- 
 quences were such as might have been expected. While the new 
 farms were being created, by help of labor diverted from the old 
 ones, food was scarce and high ; but by the time they were ready 
 to furnish supplies, their owners found their market had dis- 
 appeared. Land again falling in price, mortgages were fore- 
 closed ; and once again, were farmers, by tens of thousands, turned 
 adrift upon the world, to recommence their labors as they might. 
 We have here the second great stage of preparation, for the extra- 
 ordinary fall in the price of food that has been exhibited. 
 
 The land revenue now (1842) fell to little more than a single 
 million, from which point, under the protective tariff of that year 
 it rose gradually until, five years later, it stood again at $3, 000, 000. 
 Soon after, the discovery of the treasures of California came in to 
 make demand for manufactures, and to give activity to commerce. 
 So long as that activity continued, the sales of public lands 
 continued small, but now the building of mills and furnaces 
 having ceased the revenue from that source, in the three years 
 ending with 1856, had attained an average of nearly $10,000,000. 
 If to this, be added, the sales of land granted to railroad com- 
 panies, we obtain a total for those years of at least $50 000,000 ;
 
 60 LETTERS TO THE 
 
 or twice the amount of the twelve years from 1840 to 1852. 
 Those sales are an index to the exhaustion of the soil, the dis- 
 persion of the people, the decline of commerce, and the growth 
 of the power of the trader ; and as those of 1818 were followed 
 by the agricultural ruin of 1821, and those of 1836 by the ruin 
 of 1841, so must those of 1854-56 be followed by similar effects, 
 at a period that is now but little distant. As a rule, the highest 
 prices have always been followed by the lowest ones those of 
 the free trade period of 1822 having followed those of the protec- 
 tive one of 1816 the ruinous prices of 1842 and 1843 having 
 followed those of 1837 and 1838 and the exceedingly low one 
 of 1852 having followed closely upon the elevated ones of 1847 
 and 1848. With each successive crisis, too, the price established 
 at its close, has been lower than that of previous periods. As yet, 
 1852 occupies the lowest place; but the day is fast approaching, 
 Mr. President, when, should Heaven smile upon the labors of our 
 farmers, they will look with regret, even to the low prices of the 
 years from 1850 to 1852. The more they exhaust the soil, the 
 greater will be the tendency towards decline of price. 
 
 Instability and irregularity being the essential characteristics 
 of barbarism, there can be no real agriculture where they are 
 found. The farmer, more than any other member of the community, 
 requires stability his investments being generally made a year, 
 or more, in advance. The trader buys flour one day, and sells it 
 on the next ; but the farmer needs to determine in the autumn, 
 in what manner he will appropriate his land, for the year to come. 
 The price of wheat falling and that of tobacco rising, he can 
 make no change ; but the trader can selling the one at the first 
 appearance of a downward movement, and buying the other at 
 the first appearance of an upward one. The skilful trader desires 
 change, and the more frequent its recurrence, the more numerous 
 are his chances for accumulating fortune ; but instability is ruinous 
 to the farmer and the planter. The objects of the farmer and 
 trader are, thus, widely different ; and yet the former appears most 
 generally before the world as the advocate of his own subjection 
 to the dominion of trade, and as the opponent of the policy that 
 is based upon the idea of the extension of domestic commerce, and 
 consequent emancipation of his land from the oppressive tax of 
 transportation. Hence it is, that we meet with those conclusive 
 evidences of declining civilization which are, in one part of the 
 Union, supplied by the growing belief in the divine origin of 
 slavery, and in the necessity for its continuance ; and in the other, 
 by the facts, that in the older States, property in land becomes 
 more consolidated ; that in all of them, the poor rent-paying 
 tenant is taking the place of the small proprietor ; that, almost 
 everywhere, exhaustion of the soil is proceeding with accelerated 
 rapidity ; and that men are, everywhere, more and more com- 
 pelled to relinquish the advantages of that combination with their
 
 PRESIDENT OF THE UNITED STATES. 61 
 
 fellow-men, to which, alone, they can look for the power to call 
 the great forces of nature to their aid. 
 
 The coal-miner, the smelter of ores, the cotton and woollen 
 manufacturer, and all others engaged in the work of production, 
 are, Mr. President, like the farmer in the fact that they need 
 stability and regularity giving a steady circulation of labor and 
 its products, and increasing their ability to add to the machinery 
 required for their operations. That having been obtained, they 
 are enabled, in each successive year, to profit by the experience 
 of the past, and to give to the farmer a constantly increasing 
 quantity of cloth, in exchange for a constantly diminishing quan- 
 tity of food and wool the prices of the two tending steadily and 
 regularly to approach each other. That stability, and that regu- 
 larity of circulation, have, however, been to the people of the 
 United States, things entirely unknown. At times, as in the two 
 periods ending in 1835 and 1847, it has been approached, but, 
 in every case, it has proved but a mere lure, for inducing men 
 of skill and enterprise to waste their fortunes, and their time, in 
 the effort to advance the interests of the community, with ruin to 
 themselves. 
 
 From 1810 to 1815, mills and furnaces were built, but with 
 the return of peace, their owners embracing large and small 
 capitalists, working-men and others, the most useful portions of 
 the community were everywhere ruined, and the people who 
 had been employed were turned adrift, to seek in the West the sup- 
 port they could no longer find at home. Land sales then, as we 
 have seen, became large, and, next, the farmer suffered as the 
 manufacturer had done before. From 1828 to 1834, such esta- 
 blishments were again erected, and the metallic treasures of the 
 earth were being everywhere developed ; but, as before, the pro- 
 tective system was again abandoned, with ruin to the manufac- 
 turer, accompanied by enormous sales of public land, and fol- 
 lowed by ruin to the farmer. From 1842 to 1847, mills and 
 furnaces were again constructed ; and then, from 1848 to 1850, 
 they were again closed; the effect being seen, in 1850-52, in 
 the fall of flour to a price lower than had ever before been known. 
 The perfect harmony of all true interests, and the absolute neces- 
 sity for protection to the farmer, in his efforts to bring the artisan 
 to his side, and thus relieve himself from the heavy taxation to 
 which he is now subjected, are here exhibited in the strongest 
 light. No one, who studies the regular sequence of these facts, 
 can hesitate as to full belief in that portion of the doctrine of 
 The Wealth of Nations, which teaches, that the English system, 
 based as it is upon the idea of cheapening all the raw materials 
 of manufacture, " is a manifest violation of the most sacred rights 
 of mankind." 
 
 In the last ten years, few mills or furnaces have been erected 
 the yalue of those iu existence having been, in general, so far
 
 62 LETTERS TO THE 
 
 below the cost of production, as to have afforded no reason for 
 making any addition to their number. 
 
 The history of industry in no civilized country of the world 
 presents such a scene of destruction as is found in the manu- 
 facturing, mining, and railroad operations of the Union. Of 
 all the persons concerned in making those great improvements 
 required for diminishing the distance between the consumer and 
 the producer for enabling the producers of wool, flax, and food 
 readily to exchange for cloth and iron and for reducing the 
 prices of manufactured commodities, while raising those of the 
 raw products of the earth a large majority have been ruined; 
 and the result is seen in the facts, that the various metals are 
 rising in price, as compared with flour and cotton that our 
 farmers, as a rule, are poor that, with each successive year, the 
 land is being more rapidly exhausted and, that the country 
 exhibits so many other evidences of declining civilization. 
 
 Careful study of these facts, Mr. President, will enable you, 
 readily, to understand the causes of the demoralization now 
 making such rapid progress. The policy of the country be- 
 ing wholly adverse to the growth of manufactures, agriculture 
 remains, and necessarily, in its rudest state offering no attrac- 
 tion for men of any cultivation. Seeking a pursuit, our young 
 men shrink from one that involves so large an amount of labor, 
 and is so badly paid. Looking, next, to the production of iron, 
 or the manufacture of cloth, they see that most of the men who 
 have been so engaged, have reaped but ruin as the result. Thus 
 limited in their choice of employments, they find themselves driven 
 to becoming clerks, traders, lawyers, or doctors ; and the conse- 
 quences are seen in the fact, that we have five times more traders, 
 lawyers, and doctors, than can obtain a living by any honest 
 means. All, however, must live honestly if they can, but dis- 
 honestly if they must ; and hence it is, that the race of sharpers 
 and blacklegs, speculators and swindlers, slave traders and filli- 
 busters, counterfeiters and peculator's, increases with such rapidity. 
 It is safe, Mr. President, to say, that with the present policy of the 
 central government is inseparably connected, a greater develop- 
 ment of the merely appropriative powers, and a greater tendency 
 towards decline in the security of person and property, than can 
 be found in any country of the world, claiming to be held as 
 civilized. 
 
 This is a sad picture, Mr. President, but that it is a true one, 
 you have abundant evidence in the proceedings of the world 
 around you. 
 
 Yours, very respectfully, 
 
 HENRY C. CAREY. 
 Philadelphia, January 13th, 1858.
 
 I 
 
 PRESIDENT OF THE UNITED STATES. 63 
 
 LETTER TWELFTH. 
 
 " THIRTY-ONE independent States, enjoying a thousand advan- 
 tages, are mutually engaged in a free trade with each other. 
 That, is the free trade we want!" Such, Mr. President, was 
 the most accurate view of the great and pressing ' ' want " of 
 your countrymen, presented by yourself, but a few years since. 
 Seeing most clearly, as you then did, the enormous amount of 
 taxes paid by our farmers, in the form of transportation, commis- 
 sions, and other charges the necessary consequence of depend- 
 ence upon distant markets it was to you most obvious, that 
 what they really needed was, commerce among the States com- 
 merce within the States commerce in towns and villages that 
 commerce which, in other countries, enables men to exchange 
 with each other, ideas, services, and products, with little charge for 
 intermediate agency ; and thus to emancipate themselves, almost 
 entirely, from the grinding taxes of trade and transportation. 
 
 What, however, is it, that has given to those thirty-one States 
 the power to maintain any commerce whatsoever ? Is it not, 
 Mr. President, a consequence of diversity in their modes of 
 employment, resulting from the fact, that, while one portion of 
 the country is fitted for raising cotton or sugar, others are better 
 suited to raising wheat, rice, corn, barley, or grass that while 
 the soil of one is underlaid with coal, that of others is underlaid 
 with lead or copper, marl or lime ? That such is the case, is 
 beyond all doubt. That without difference there can be no 
 commerce, is shown by the facts, that the cotton planter of Caro- 
 lina maintains no commerce with his fellow planter of Georgia, 
 and that the farmer of Illinois makes no exchanges with his 
 fellow farmer of Indiana. 
 
 What, however, is the actual amount of commerce among the 
 States ? How much does Kentucky exchange with Missouri ? 
 What is the annual value of the commerce of Ohio with Indiana 
 of Virginia with Kentucky ? Scarcely more, as I imagine, than 
 that of a single day's labor of their respective populations; and, 
 perhaps, not even half so much. Why, Mr. President, is this 
 the case ? Is it not a necessary consequence of the absence of 
 that diversity of employments within the States, which we see, 
 everywhere, to be so indispensable to the maintenance of com- 
 merce ? Assuredly it is. Ohio and Indiana have little more 
 than one pursuit that of scratching out the soil, and exporting 
 it in the form of food. Virginia and Kentucky have the same 
 pursuits selling their soil in the forms of tobacco and of corn. 
 Carolina and Alabama have the same pursuits ; and so it is 
 throughout by far the larger portion of the Union millions of
 
 64 LETTERS TO THE 
 
 people being employed in one part of it, in robbing the earth of 
 the constituents of cotton, while in others, other millions are em- 
 ployed in plundering the great treasury of nature, of the constitu- 
 ents of wheat and rice, corn and tobacco, and thus destroying, 
 for themselves and their successors, the power to maintain commerce. 
 
 The commerce of State with State is, thus, Mr. President, but 
 small ; and the reason why it is so, is, that the commerce of man 
 with his fellow man, within the States, as a general rule, is so 
 exceedingly diminutive. Were the people of Illinois enabled to 
 develope their almost boundless deposits of coal and iron ore, 
 and thus to call to their aid the wonderful power of steam, the 
 internal commerce of the State would grow rapidly making a 
 market at home for the food produced, and enabling its producer 
 to become a large consumer of cotton. Cotton mills then grow- 
 ing up, bales of cotton wool would travel up the Mississippi, to 
 be given in exchange for the iron required for the roads of 
 Arkansas and Alabama, and for the machinery demanded for the 
 construction of cotton and sugar mills, in Texas and Louisiana. 
 
 That, Mr. President, as you so well have said, is the sort of 
 free trade that we really require. It grew with great rapidity, in 
 the period ending in 1816 that period in which the domestic 
 market absorbed so large a proportion of cotton that was pro- 
 duced. It died away, in the years that followed, from 1817 
 to 1824, when mills and furnaces were closed, and mechanics 
 were, everywhere throughout the country, suffering for want of 
 food. It grew again, in the period from 1824 to 1834, when 
 the product of iron rose to 200,000 tons, and thus enabled the 
 farmers of the country to double their demands for the products 
 of the plantation. It declined from 1834 to 1842 the period, 
 during which, the domestic production of iron, and the domestic 
 consumption of cotton, remained almost unchanged in quantity, 
 notwithstanding an addition of 25 per cent, to our population 
 It grew again, from 1842 to 1848 the domestic production 
 of iron having in that brief period almost quadrupled, while the 
 domestic demand for cotton doubled. It has now declined 
 the production of iron being less than it was five years since, and 
 the demand for cotton being, at this moment, not greater, prob- 
 ably, than it was in 1842, when our numbers were little more 
 than half as great as they are at the present hour. 
 
 We have now, probably, thirty millions of people, occupying 
 the thirty-one States, of which, Mr. President, you spoke ; and 
 yet, among them all, there is, at the present time, almost literally, 
 no commerce. The planter stores his cotton waiting for better 
 prices. For the same reason, the farmer houses his wheat and 
 his corn. Neither of them, therefore, is able to purchase cloth 
 or iron. The iron master, as a consequence, is forced to close 
 his furnace, and the maker of cloth closes his mill. Wages 
 ceasing to be paid, the owner of houses receives no rent. Houses
 
 PRESIDENT OP THE UNITED STATES. 65 
 
 ceasing to be built, the unemployed mason and carpenter take 
 their places by the side of the already discharged workers in wool 
 and cotton, in coal and iron. Commerce thus perishes ; and this 
 it does, because our rulers, Mr. President, have been led to believe 
 that national wealth and power were to be obtained, as the results 
 of measures directly the reverse of those so plainly indicated by 
 yourself, at the opening of the Central railroad, but a few years 
 since. You, then, most clearly saw, that what we needed was, the 
 establishment of that entire freedom of commerce among ourselves, 
 that would enable each and every man to find, at the instant, a 
 purchaser for all his powers of body, or of mind ; and that, so far 
 as the system commonly called " free trade," tended to prevent 
 the growth of that commerce, it was precisely the sort of free- 
 dom that we did NOT want. A disciple in the school of Adam 
 Smith, you could not fail to agree with him in his estimate of the 
 vast advantage to be derived by the farmer from condensing 
 thousands of pounds of food and wool into a piece of cloth, and 
 thus diminishing the tax of transportation every step in that 
 direction tending towards diversifying employments, and thus ex- 
 tending domestic commerce, while greatly facilitating intercourse 
 with the distant nations of the world. 
 
 The greater the number of differences among men the 
 greater the diversity of demands for their various faculties the 
 greater, Mr. President, is the power to maintain commerce among 
 themselves. The greater the domestic commerce, the greater is, 
 always, the power to maintain commerce with distant people, and 
 the greater the tendency towards the growth of wealth and power. 
 For proof of this, we need only look to France that country of 
 Europe whose policy has most consistently been directed towards 
 the diversification of employments, and the extension of internal 
 commerce. Seeking, however, further evidence of this, you may 
 look to Belgium, Sweden, Denmark; and Northern Germany, 
 in all of which you will find a rapid extension of intercourse 
 with the world, as a necessary consequence of increasing power 
 for the maintenance of that domestic commerce, so well described 
 by you, Mr. President, as the sort of "free trade" that we really 
 need among ourselves. Looking, next, homeward, you at once 
 are struck with the great power of Massachusetts to maintain 
 commerce with New York and Pennsylvania, when compared 
 with the commercial relations of Virginia with Kentucky, or of 
 Carolina with Tennessee. 
 
 Look, however, where you may, you will nowhere find facts 
 more fully confirmatory of the accuracy of your views, than in the 
 commercial history of England, now the great apostle of the sort 
 of free trade that we do not require. A century since, she was 
 busily engaged in robbing her soil, and exporting it in the form 
 of raw materials, to be sold, and at the lowest prices, to the 
 manufacturing communities of the lower Rhine. The more the 
 5
 
 66 LETTERS TO THE 
 
 soil became impoverished, and the less its yield, the lower, as, 
 Mr. President, you have seen, became the prices ; and hence arose 
 the boast among the German cities, that they bought from the 
 Englishman the skin of the fox for a groat, and then re-sold him 
 the tail for a shilling. Ridiculous as this may now seem, it is 
 precisely what we ourselves are doing selling flour by the ton, 
 and then buying it back again, in the form of cloth and iron, by 
 the pound selling cotton by the bale, and then buying it back 
 by the pennyweight and exhausting the soil in the effort, in this 
 manner, to obtain the little cloth and iron, we are able to consume. 
 Even then, however, a change of the English system was near at 
 hand. Efficient protection developing the cloth and iron manu- 
 factures soon gave the English farmer a market at home, and 
 thus created domestic commerce, the only solid foundation for a 
 great external one. Raw materials rose in price, while machines 
 and cloths were cheapened ; and thus was furnished the most 
 conclusive evidence, that the nation which would advance in wealth 
 and power, must adopt a policy looking to the emancipation of the 
 farmer from the tax of transportation, and to the approximation 
 of the prices of his rude products, and those of the finished com- 
 modities required for his use. 
 
 Turning now homewards, Mr. President, we find abundant evi- 
 dence of your perfect accuracy in looking to the extension of 
 domestic commerce, as furnishing the only sure foundation for 
 an extended intercourse with foreign countries, and as being, 
 therefore, the sort of free trade that we really need. From the 
 date of the passage of the act of 1816, by which the axe was laid 
 to the root of our then-rapidly-growing manufactures, the foreign 
 trade steadily declined, until, in 1821, the value of our imports 
 was less than half of what it had been six years before. Thence- 
 forward, there was little change until the highly protective act of 
 1828 came fairly into operation the average amount of our im- 
 ports, from 1822 to 1830, having been but 80 millions and the 
 variations having been between 96 millions in one year and 70 in 
 another. Under that tariff, domestic commerce grew with great 
 rapidity enabling our people promptly to sell their labor, and 
 thus to become large customers to the people of other lands, as 
 is shown by the following figures, representing the value of goods 
 imported : 
 
 1830-31 $103,000,000 
 
 1831-32 101,000,000 
 
 1832-33 108,000,000 
 
 1833-34 126,000,000 
 
 Here, Mr. President, is a steady and regular growth the last 
 of these years being, by far the highest, and exceeding, by more 
 than 50 per cent., the average of the eight years from 1822 to 
 1830. In this period, not only did we contract no foreign debt, 
 but we paid off the whole of that which previously had existed 
 Ihe legacy of the war of independence.
 
 PRESIDENT OF THE UNITED STATES. 67 
 
 The Compromise tariff began now to exert its influence on the 
 societary movement stopping the building of mills and the open- 
 ing of mines, and thus lessening the power to maintain domestic 
 commerce. How it operated on that with foreign nations, is 
 shown in the facts, that the imports of 1837 went up to 
 $189,000,000, and those of 1838 down to $113,000,000 those 
 of 1839 up to $162,000,000, and those of 1840 down to 
 $107,000,000 ; while those of 1842 were less than they had been 
 ten years before. In this period, we ran in debt to foreigners, to 
 the extent of hundreds of millions, and closed with a bankruptcy 
 so universal, as to have embraced, individuals, banks, towns, cities, 
 States, and the national treasury itself. 
 
 That instability is the essential characteristic of the system 
 called free trade that one which, as you, Mr. President, have 
 so clearly seen, we do not want will be obvious on the most 
 cursory examination of the facts presented by the two -periods of 
 that system, through which we have thus far passed. From more 
 than $100,000,000, in 1817, our imports fell, in 1821, to 
 $62,000,000. In 1825, they rose to $96,000,000, and then, two 
 years later, they were but $79,000,000. From 1829 to 1834, 
 they grew steadily and regularly, but, no sooner had protection 
 been abandoned, than instability, with its attendant speculation, 
 re-appeared the imports of 1836 having been greater by 45 per 
 cent, than those of 1834, and those of 1840 little more than half 
 as great as those of 1836. Careful study of these facts, Mr. Pre- 
 sident, can scarcely fail to satisfy you, that the cause of all the 
 difficulties you have so well described, is to be found in the action 
 of the central government ; and that, it is in that direction, and 
 not to modification of the local action, we must look for remedy. 
 
 Once again, in 1842, protection was restored ; and once again, 
 do we find a steady and regular growth in the power to maintain 
 intercourse with the outer world, consequent upon the growth of 
 domestic commerce, as is shown in the following figures : 
 
 1843-44 $108,000,000 
 
 1844-45 117,000,000 
 
 1846-46 121,000,000 
 
 1816-47 146,000,000 
 
 Here, Mr. President, we find a constant increase of power to go 
 to foreign markets, accompanied by a constant decrease in the 
 necessity for resorting to them the domestic production of cot- 
 ton and woollen goods having doubled in this brief period, while 
 the domestic production of iron had more than trebled. 
 
 Ten years having elapsed since the tariff of 1846 became 
 fairly operative, we have now another opportunity for contrasting 
 the operation of the free trade that we do not want, with that 
 which we so much require. Doing so, we find the same instability 
 by which were characterised the periods which preceded the act 
 of 1824 that of 1828, and that of 1842 and on a larger scale.
 
 68 LETTERS TO THE 
 
 In 1840-50, out imports were $178,000,000. In 1854, they were 
 $304,000,000. In 1855, 8200,000,000. In 1857, $360,000,000 
 and now, they are about to fall to $180,000,000, if not, even, to a 
 figure greatly lower. 
 
 That this must be so, will be obvious to those who study the 
 history of the past few years, and contrast the hundreds of mil- 
 lions of debt we' have created making an annual demand for 
 $30,000,000 for the payment of interest with the entire discredit 
 into which we have now so justly fallen. That it must be so, will 
 be clear to those who look to the facts, that, prior to the opening 
 of the Crimean war, the price of flour had fallen to a lower point 
 than had ever before been known that since that period, we 
 have driven millions of men to the creation of farms, that are now 
 about to deluge us with food that the number of persons en- 
 gaged in any department of manufacture, is less now, than it was 
 five years since that the power to purchase food is as steadily 
 declining, as the power to furnish it increases and that, with 
 favorable seasons, its future price must, certainly, be lower than 
 has ever yet been known. That it must be so, will be apparent 
 to those who look to the facts, that the cotton crop, in 1849, ex- 
 ceeded 2,800,000 bales that, since that time, the population of 
 the cotton-growing States has been almost a third increased 
 that the new lands are now becoming productive that the aug- 
 mentation of the crop is likely to be as great as it was, after 
 the last bankruptcy, in 1841, when the average was, suddenly, 
 forty per cent, increased that it is likely soon to reach 
 4,000,000 bales that the domestic market will now be 250,000 
 bales less than it has been in the past two years that the foreign 
 market will, therefore, be required to absorb at least a million of 
 extra bales that the farmers of Europe will find a reduction in 
 their power to purchase clothing, consequent upon the reduction 
 in the prices of our food that the demand tends thus to decline 
 as the supply tends to increase and, that all past experience 
 goes to show, that after each successive crisis, the permanent 
 average of prices has fallen below that which had been fixed by 
 its predecessor. The seasons may prove unfavorable, and crops 
 may prove small, but should Providence favor the planter with 
 liberal returns, he is likely to be more nearly ruined, than in any 
 period he yet has seen. Such being the facts in reference to the 
 future of our great staples, it is fair, Mr. President, to assume, 
 that the quantity of foreign merchandise we shall now import 
 will scarcely go beyond, even if it equal, $180,000,000. 
 
 How the facts above described have tended to affect the cur- 
 rency, I propose to show in another letter, remaining, meanwhile, 
 Yours, very respectfully, 
 
 HENKY C. CAREY. 
 Philadelphia, January 19th, 1858.
 
 PRESIDENT OF THE UNITED STATES. 69 
 
 LETTER THIRTEENTH. 
 
 THE single commodity, Mr. President, that is of universal 
 request, is MONEY. Go where we may, we meet persons seeking 
 commodities required for the satisfaction of their wants yet 
 widely differing in their demands. One needs corn ; a second, 
 clothing; a third, books, newspapers, horses, or ships. Many 
 desire food, yet while one would have fish, another rejects the fish 
 and seeks for meat. Offer clothing to him who sought for ships, 
 and he would prove to have been supplied. Place before the 
 seeker after silks, the finest lot of cattle, and he will not purchase. 
 The woman of fashion rejects the pantaloons ; while the porter 
 regards her slipper as wholly worthless. Of all these people, 
 nevertheless, there would not be found a single one, unwilling to 
 give labor, attention, skill, houses, bonds, lands, horses, or what- 
 ever else might be within his reach, in exchange for money pro- 
 vided, only, that the quantity offered were deemed sufficient. 
 
 Were a hundred ships to arrive at our several ports to-morrow, 
 a single one of which was freighted with gold, she alone would 
 find a place in the editorial columns of our journals leaving 
 wholly out of view the remaining ninety-nine, freighted with silks 
 and teas, cloth and sugar. The news, too, would find a similar 
 place in almost all the journals of the Union, and for the reason, 
 that all their readers, the bears excepted, so much rejoice when 
 money comes in, and so much regret when it goes abroad. Of 
 all the materials of which the earth is composed, there are none 
 so universally acceptable as gold and silver none, in whose 
 movements so large a portion of every community feels an 
 interest. 
 
 Why, Mr. President, is this the case ? Because of their having 
 distinctive qualities that bring them into direct connection with 
 the distinctive qualities of man facilitating the growth of asso- 
 ciation, and promoting the development of human powers. They 
 are the indispensable instruments of society, or commerce! 
 
 That they are so, would seem to be admitted by those journal- 
 ists when giving to their movements so much publicity ; and yet, 
 on turning to another column, you would probably find it there 
 asserted, that all this anxiety in regard to money was evidence 
 of ignorance man's condition being improved, by parting with 
 gold that he can neither eat, drink, nor wear, in exchange for 
 sugar that he can eat, and cloth that he can wear. Such may be 
 the case, says one reader, but, for my part, I prefer to see money 
 come in, because when it does so, I can borrow at six per cent. ; 
 whereas, when it is going out, I have to pay ten, twelve, or 
 twenty. This is doubtless true, says another, but I prefer to see
 
 70 LETTERS TO THE 
 
 money arrive being then able to sell my hats and shoes, and to 
 pay the people who make them. It may be evidence of ignorance, 
 says a third, but I always rejoice when money flows inwards, for 
 then I can always sell my labor ; whereas, when it flows outwards, 
 I am unemployed, and my wife and children suffer for want of 
 food and clothing. Men's natural instincts look, thus, in one 
 direction, while mock science points in another. The first, Mr. 
 President, should be right, because they are given of God. The 
 last may be wrong being one among the weak inventions of 
 man. Which is right, we may now inquire. 
 
 Of all the commodities in use among men, there is none the 
 control of which gives to its possessor so large an amount of 
 power, as that of money. Sovereigns in the East heap up gold 
 as provision against future accidents ; and finance ministers in 
 the West, rejoice when their accounts enable them to exhibit a 
 full supply of the precious metals. When it is otherwise, the 
 highest dignitaries are seen paying obsequious court to the Roth- 
 schild and the Baring, controllers of the money market. So, too, 
 when railroads are to be made, or steamers to be built. Farmers 
 and contractors, land-owners and stockholders, then go, cap in 
 hand, to the Croesuses of Paris and London, anxious to obtain a 
 hearing and desiring to propitiate the man of power by making 
 whatsoever sacrifice may seem to be required. 
 
 Of all the questions, Mr. President, that are now before us, 
 there is none that so much occupies the public mind, as that of 
 the establishment of the currency on such a basis, as will secure 
 us against future repetition of the "extravagant expansions" and 
 "ruinous contractions, " that have, in each and every case, attended 
 the departure of the central government from the course of policy 
 you so much admire the course which looks to giving us that 
 freedom of domestic intercourse, from which we have been so much 
 debarred. How great, in your opinion, is the importance of this 
 question, is clearly indicated, as well by the fulness with which 
 you have treated it in your Message, as by your suggestions in 
 reference to the remedies that, as you seem to think, may be 
 required for the correction of the evils under which we suffer. 
 
 Prior to the formation of the Constitution, the power to 
 create banks, and to define the powers of such institutions, 
 rested, unquestionably, with the States ; and as, when they ac- 
 cepted that instrument, they certainly retained all the powers not 
 expressly parted with, not a doubt can now exist of their having, 
 in the time that has since elapsed, acted in full accordance with 
 both its letter and its spirit. Nevertheless, so great in your 
 opinion, Mr. President, are the evils now resulting from the exer- 
 cise of the power thus retained, that, "after long and much reflec- 
 tion," you have arrived at the conclusion, that, "if experience 
 shall prove it to be impossible to enjoy the facilities which well- 
 regulated banks might afford, without at the same time suffering
 
 PRESIDENT OF THE UNITED STATES. 71 
 
 the calamities which the excesses of the banks have hitherto 
 inflicted upon the country, it would then be far the lesser evil to 
 deprive them altogether of the power to issue a paper currency, 
 and confine them to the functions of banks of deposit and 
 discount." The measures thus suggested involving, of course, 
 the entire annihilation of the rights of the States, in reference to 
 this important question rights, that, during half a century from 
 the peace of 1183, had remained entirely unquestioned it is no 
 matter for surprise, that it should have required the most serious 
 reflection, before you should have satisfied yourself of the necessity 
 for suggesting a remedy so entirely opposed to the views you pre- 
 viously had entertained ; and so much opposed, too, to all the 
 ideas of the founders of the Constitution, in reference to the beau- 
 tiful system of local self-government they had found established. 
 Where, however, Mr. President, exists the power to deprive the 
 States of the exercise of rights with which they have never parted ? 
 In the central government ? Assuredly not that government 
 having no power not expressly granted to it by the Constitution. 
 It is asserted, nevertheless, that the Supreme Court stands now 
 ready to reverse all the action of the past seventy years at this 
 late period deciding, that Washington and Adams, Hamilton and 
 Franklin, Jefferson and Madison, had been altogether wrong in 
 their estimate of the powers of the States that, according to the 
 true intent and meaning of the Constitution, the regulation of all 
 the banks of the Union belonged to the central authorities and 
 that, it needs but the passage of an act of Congress, for the 
 reduction of all the banks of the Union to a condition nearly akin 
 to that of saving-funds, authorised to receive the deposits of indi- 
 viduals, and to lend them out ; but deprived of all power in any 
 other manner to aid the operations of the communities in which 
 they are placed. 
 
 It is but the first step, Mr. President, that is difficult. That 
 once taken, each successive one becomes more easy the course 
 of man, in whatever direction, whether towards barbarism or 
 civilization, centralization or localization, being one of constant 
 acceleration. The removal of the deposits, in defiance of law, by 
 General Jackson, was a great step towards centralization ; and 
 yet, it was but trivial, compared with that you have now sug- 
 gested leading, as it inevitably does, to the entire subjection 
 of the currency to the central government. Look almost where 
 we may, Mr. President, throughout the European history of the 
 middle ages, we see the exclusive control of the indispensable 
 instrument of society, to have been regarded as furnishing the 
 most important of all the machinery of taxation. So was it, 
 with our Continental money the amount of taxes collected by 
 its aid, having been immeasurably greater than could have been 
 collected as a consequence of any direct appeal to the people. 
 So has it been, too, throughout this century, with the Austrian
 
 72 LETTERS TO THE 
 
 government paper money having been issued until it had be- 
 come greatly depreciated, and then having been replaced by other 
 paper money, whose value was, as the taxpayers were assured, to 
 be maintained. That, in turn, becoming depreciated, it was called 
 in, to be again and again replaced, until nearly the whole original 
 amount had disappeared. To relieve themselves from such 
 oppression it was, that the people of European cities established 
 banks ; and it was by means of those institutions, that the con- 
 trol of the currency was finally wrested from the various sovereigns, 
 and vested in their subjects' hands leaving to the government 
 no power, but that of coinage. 
 
 That, Mr. President, having been one of the most important 
 steps in the road towards the improvement of man's condition, 
 the money-shop, or bank, has obtained, in all communities, au 
 importance increasing in the direct ratio of their growth in civili- 
 zation, and in freedom. Among ourselves, alone, are they the 
 subjects of unceasing denunciation and persecution. Having be- 
 come "identified with the habits of our people," they cannot, as 
 you say, be "suddenly abolished"; but their further existence 
 can, as you add, be tolerated, only on the condition of their 
 limiting themselves "to their appropriate sphere" abstaining 
 from " administering to the spirit of wild and reckless speculation, 
 by extravagant loans and issues," and thus rendering themselves 
 of " advantage to the public." 
 
 It is quite impossible, Mr. President, to close our eyes to the 
 fact, that all our tendencies, for the last few years, have been 
 towards the absorption of all power by the central authorities ; 
 but, great as have been the previous steps in that direction, the 
 one now proposed goes so far beyond them all, as to leave them 
 out of sight. Let the measures thus suggested be carried into 
 effect let the control of the currency pass into the hands of 
 Federal agents and all the expansions and contractions you 
 have so well described, will be far exceeded. "Deplorable," as 
 you truly say, is " our present financial condition." The cup of 
 misery will, however, then be full the pages of history furnishing 
 abundant evidence, that of all the tyrannies yet known to man, 
 that of a centralized democracy is the most oppressive. 
 
 That there is great error somewhere, there is no doubt. Does 
 it result from the existence of banks ? Scarcely, as it would 
 seem their growth, throughout Europe, having been in the direct 
 ratio of the advance in civilization. That of France, with its 
 numerous branches, is the creation of the present century. Those 
 of Germany tend rapidly to increase in number. Turkey makes 
 no banks. Does it lie with bank notes ? It would seem not 
 Great Britain, whose advance in civilization was so rapid, having 
 been, at all times, the leader in the use of a paper circulation. 
 The use of such notes steadily increases in France and Belgium ; 
 and yet, of all the countries of Europe, there are none that have
 
 PRESIDENT OP THE UNITED STATES. 73 
 
 passed so nearly uninjured, through the present crisis. Their use 
 is greater in New England than in Illinois ; and yet, the changes 
 in the value of property have been far greater in the latter, than 
 in the former. 
 
 Of all the countries of the world, claiming to rank among those 
 most civilized, the only two whose governments are now engaged 
 in a crusade against bank notes, are the United States and Eng- 
 land the two, whose policy is wholly directed to the extension 
 of foreign trade ; the two, that now control the chief gold deposits 
 of the world ; the two, which regard an increase in the necessity 
 for ships and wagons as evidence of growing wealth and power ; 
 the two, whose every step is towards increase of centralization ; 
 the two, whose policy tends towards diminution in the prices of 
 raw materials, and the subjection of the farmer to the trader; 
 the two, whose crises are most frequent and most severe ; and 
 the two, that are now most nearly bankrupt. 
 
 The phenomena thus presented for consideration, are, certainly, 
 evidences of declining civilization. Such being the case, further 
 progress in that direction must tend towards barbarism. What, 
 however, is the real route towards civilization ? That, Mr. Presi- 
 dent, is a question that can be answered, only after a brief inquiry 
 into the effects resulting from the possession of money, and into 
 the circumstances which influence its supply, which it is proposed 
 now to make. Should that result in satisfying you, that the 
 cause of all our difficulties is to be found in the failure of the 
 central government to carry into effect your views in regard to 
 that commerce which we really want, and not in the local action ; 
 and should you, thereby, be relieved of all necessity for departing 
 from the construction given to the Constitution by your most 
 distinguished predecessors, it will, I am well assured, be cause of 
 unmixed satisfaction. 
 
 Yours, very respectfully, 
 
 HENRY C. CAREY. 
 
 Philadelphia, January 2%d, 1858.
 
 74 LETTERS TO THE 
 
 LETTER FOURTEENTH. 
 
 " MONEY being a mere commodity is subject to the same 
 laws that govern wool and cloth, coal and iron. Why, then, 
 should our legislators trouble themselves about its movements, 
 any more than about those of turnips, or potatoes ? If we need 
 it, and are ready to pay for it, it will come. If we do not need 
 it, or have nothing with which to pay for it, it will not come ; 
 and we shall, perhaps, be better off without than with it." Such, 
 Mr. President, is the sort of argument that, year after year, is 
 used by gentlemen who hold to the idea that countries are to be 
 enriched by increasing trade with distant people, and sacrificing 
 that commerce among ourselves which, as you have so clearly 
 seen, is the sort of " free trade " we really need ; by financiers 
 who tell us, that gold being one of our products, its export 
 is as natural and necessary as is that of cotton, and who look, 
 with perfect calmness, at an outward current of the precious 
 metals greatly exceeding the inward one ; by Secretaries of the 
 Treasury, who close their eyes to the clouds that are gathering 
 round, and then, when overtaken by the storm, gravely tell the 
 suffering millions, that "it was impossible to foresee the present 
 revulsion in trade and commerce"; and generally, by all that 
 class of middlemen, now so rapidly increasing among ourselves, 
 which lives by preying upon the useful portions of society, and 
 seeks, as far as possible, to widen the distance between the men 
 who labor to produce, and depend upon the sale of their labor 
 and its products, for the ability to feed their wives, their children, 
 and themselves. 
 
 Such persons, Mr. President, have, as it would seem, yet to 
 learn, that, in addition to the qualities common to themselves and 
 other commodities, the precious metals possess that other most 
 important one, of being the great instruments, provided by the 
 Creator, for facilitating those exchanges of society which consti- 
 tute that commerce between man and his fellow man, by the 
 growth of which we are furnished with the highest of all the 
 evidences of advancing civilization. By their help it is, that the 
 farmer, the miller, the clothier, and all other members of 
 society, are enabled to purchase for a single cent, a portion of 
 the labors of thousands, and tens of thousands, of men employed 
 in making railroads, engines, and cars, and transporting upon 
 them, annually, hundreds of millions of letters ; or, for another 
 cent, their share of the labor of the hundreds, if not thousands, of 
 men who have contributed to the production of a penny news- 
 paper. The mass of small coin is thus a saving fund for labor, 
 because it facilitates association and combination giving utility
 
 PRESIDENT OF THE UNITED STATES. 75 
 
 to billions of millions of minutes that would be wasted, did not a 
 demand exist for them at the moment the power to labor had been 
 produced. Labor being the first price given for everything we 
 value, and being the commodity that all can offer in exchange, 
 the progress of communities in wealth and influence, is in the 
 direct ratio of the presence, or absence, of an instant demand for 
 the forces, physical and mental, of each and every man in the 
 community resulting from the existence of a power on the part 
 of each and every other man, to offer something valuable in 
 exchange for it. It is the only commodity that perishes at the 
 instant of production, and that, if not then put to use, is lost 
 forever. 
 
 We are all, Mr. President, momently producing labor-power, 
 and daily taking in the fuel by whose consumption it is produced ; 
 and that fuel is wasted, unless its product be on the instant use- 
 fully employed. The most delicate fruits, or flowers, may be kept 
 for hours or days ; but the force resulting from the consumption 
 of food, cannot be kept, even for a second. That the instant 
 power of profitable consumption may be coincident with the in- 
 stant production of this universal commodity, there must be inces- 
 sant combination, followed by incessant division and subdivision ; 
 and that, in turn, followed by as incessant recomposition. This 
 is seen in the case above referred to, where miners, furnace-men, 
 machine-makers, rag-gatherers, carters, bleachers, paper-makers, 
 railroad and canal men, type-makers, compositors, pressmen, au- 
 thors, editors, publishers, newsboys, and hosts of others, combine 
 their efforts for the production in market of a heap of newspapers 
 that has, at the instant of production, to be divided off into por- 
 tions suited to the wants of hundreds of thousands of consumers. 
 Each of these latter pays a single cent then perhaps subdividing 
 it among half a dozen others, so that the cost is perhaps no more 
 than a cent per week ; and yet, each obtains his share of the labors 
 of all the persons by whom it had been produced. 
 
 Of all the phenomena of society, this process of division, sub- 
 division, composition, and recomposition, is the most remarkable ; 
 and yet, Mr. President being a thing of such common occur- 
 rence it scarcely attracts the slightest notice. Were the news- 
 paper above referred to, partitioned off into squares, each repre- 
 senting its portion of the labor of one of the persons who had 
 contributed to the work, it would be found to be resolved into six, 
 eight, or perhaps even ten thousand pieces, of various sizes, small 
 and great the former representing the men who had mined and 
 smelted the ores of which the types and presses had been com- 
 posed, and the latter the men and boys by whom the distribution 
 had been made. Numerous as are these little scraps of human 
 effort, they are, nevertheless, all combined in every sheet, and 
 every member of the community may for the trivial sum of fifty 
 cents per annum enjoy the advantage of the information therein
 
 76 LETTERS TO THE 
 
 contained ; and as fully as he could do, had it been collected for 
 himself alone. 
 
 Improvements in the modes of transportation are advantageous 
 to man, but the service thereby rendered, when compared with 
 the cost, is very small. A ship worth $50,000 cannot effect 
 exchanges between men at opposite sides of the Atlantic, to an 
 extent exceeding five or six thousand tons per annum ; whereas, 
 a furnace of similar cost will effect the transmutation of thirty 
 thousand tons' weight of coal, ore, limestone, food, and clothing, 
 into iron. Compared with either of these, however, the commerce 
 effected by the help of $50,000 worth of little white pieces, repre- 
 senting labor to the extent of three or five cents labor which, 
 by their help, is gathered up into a heap, and then divided and 
 subdivided day after day throughout the year and it will be 
 found that the service rendered to society, in economizing force, 
 by each dollar's worth of money, is greater than is rendered by 
 hundreds, if not thousands, employed in manufactures, or tens of 
 thousands in ships or railroads ; and yet there are able writers, 
 Mr. President, who tell us, that money is so much " dead 
 capital," being "an important portion of the capital of a 
 country that produces nothing for the country." 
 
 " Money, as money," says an eminent economist, "satisfies no 
 want, answers no purpose. * * The difference between a 
 country with money, and a country altogether without it, would," 
 as he thinks, " be only one of convenience, like grinding by water 
 instead of by hand." A ship, as a ship a road, as a road a 
 cotton-mill, as a cotton-mill in like manner, however, "satisfies 
 no want, answers no purpose." They can be neither eaten, drunk, 
 nor worn. All, however, are instruments for facilitating the work 
 of association, and the growth of man in wealth and power is in 
 the direct ratio of the facility of combination with his fellow-men. 
 To what extent they do so, when compared with money, we may 
 now inquire. To that end, let us suppose, Mr. President, that 
 by some sudden convulsion of nature all the ships of the world 
 were at once annihilated, and remark the effect produced. The 
 ship-owners would lose heavily ; the sailors and the porters would 
 have less employment ; and the price of wheat would temporarily 
 fall ; while that of cloth would, for the moment, rise. At the 
 close of a single year, by far the larger portion of the operations 
 of society would be found moving precisely as they had done be- 
 fore commerce at home having taken the place of that abroad. 
 Cotton and tropical fruits would be less easily obtained in Northern 
 climes, and ice would be more scarce in Southern ones ; but, in 
 regard to the chief exchanges of a society like our own, there 
 would be no suspension, even for a single instant. So far, indeed, 
 would it be to the contrary, that, in many countries, commerce 
 would be far more active than it had been before the loss of 
 ships producing a demand for the opening of mines, for the con-
 
 PRESIDENT OF THE UNITED STATES. 77 
 
 struction of furnaces and engines, and for the building of mills, 
 that would make a market for labor, mental and physical, such as 
 had never before been known. 
 
 Let us next suppose that the ships had been spared, and that 
 all the gold and silver, coined and not coined, mined and not 
 mined, had been annihilated, and study the effect that would be 
 produced. The reader of newspapers finding himself unable 
 to pay for them in beef or butter, cloth or iron would be com- 
 pelled to dispense with his usual supply of intelligence, and the 
 journal would be no longer printed. , Omnibuses would cease to 
 run, for want of sixpences ; and places of amusement would be 
 closed, for want of shillings. Commerce among men would be at 
 an end, except so far as it might be found possible to effect direct 
 exchanges food being given for labor, or wool for cloth. Such 
 exchanges could, however, be few in number, and men, women, 
 and children, would perish by millions, because of inability to 
 obtain food and clothing in exchange for service. Cities whose 
 population now counts by hundreds of thousands would, before 
 the close of a single year, exhibit hundreds of blocks of unoccupied 
 buildings, and the grass would grow in their streets. A substi- 
 tute might, it is true, be found men returning to the usages of 
 those primitive times when wheat or iron, tobacco or copper, con- 
 stituted the medium of exchange ; but under such circumstances, 
 society, as at present constituted, could have no existence. A 
 pound of iron would be required to pay for a Tribune or a Ledger, 
 and hundreds of tons of any of the commodities above referred to, 
 would be needed for the purchase of the weekly emissions of either. 
 Tons of them would be needed to pay for the food consumed in 
 a single eating-house, or the amusement furnished in a single the- 
 atre ; and how the wheat, the iron, the corn, or the copper, could be 
 fairly divided among the people who had contributed to the pro- 
 duction of the journal, the food, or the amusement, would be a 
 problem entirely incapable of solution. 
 
 The precious metals, Mr. President, are to the social body what 
 atmospheric air is to the physical one. Both supplying the ma- 
 chinery of circulation, the resolution of the physical body into its 
 elements when deprived of the one, is not more certain than is 
 that of the social body when deprived of the other. In both 
 these bodies, the amount of force is dependent upon the rapidity 
 of circulation. That it may be rapid, there must be a full supply 
 of the machinery by means of which it is to be effected ; and yet 
 there are distinguished writers who mourn over the cost of main- 
 taining the currency, as if it were altogether lost, while expatiating 
 on the advantages of canals and railroads not perceiving, appa- 
 rently, that the money that can be carried in a bag, and that 
 scarcely loses in weight with a service of half a dozen years, effects 
 more exchanges than could be effected by a fleet of ships, many 
 of which would, at the close of such a period of service, be rotting
 
 78 LETTERS TO THE 
 
 on the shores on which they had been stranded, while the remain- 
 der would already have lost half of their original value. 
 
 Of all the labor-saving machinery in use, there is none that so 
 much economizes human power, and so much facilitates combina- 
 tion, as that known by the name of money. Wealth, or the power 
 of man to command the services of nature, grows with every in- 
 crease in the facility of combination this latter growing with 
 the growth of the ability to command the aid of the precious 
 metals. Wealth, then, should increase most rapidly where that 
 ability is most complete. 
 
 Nevertheless, Mr. President, a study of our Treasury Reports 
 of the last few y.ears., would lead to the conclusion, that of all the 
 machinery used by man, the ship was the most important, and 
 the precious metals those that demanded least attention. Year 
 after year, we are told of the wonderful growth of our tonnage ; 
 and that, too, by gentlemen who seem never to advert to the fact, 
 that a single ship would carry more tons of food and wool, in the 
 shape of cloth, than it can carry of hundred-weights, in their original 
 form. The great object to be accomplished being, that of in- 
 creasing the quantity of shipping, it seems almost surprising that 
 we should not, as yet, have had a proposition to require the cotton 
 to be exported in the seed, and the corn in the husk, as a means 
 of increasing the bulk of the things to be transported, and thus 
 augmenting the demand for ships. Our whole policy looking to 
 the export of our products in their rudest states and thus main- 
 taining, at its highest, the tax of transportation and that being 
 the road towards barbarism it affords no cause for surprise, 
 that our people are so frequently compelled to resort to the use 
 of worthless rags, as furnishing the only means of circulation that 
 are within their reach. What are the circumstances which tend 
 to increase the supply of money, and how we may be enabled to 
 carry into effect your idea of a real specie circulation, I propose 
 to show in another letter, remaining meanwhile, Mr. President, 
 Yours, very respectfully, 
 
 HENRY C. CAREY. 
 Philadelphia, January 25th, 1858.
 
 PKESIDENT OF THE UNITED STATES. 79 
 
 LETTER FIFTEENTH. 
 
 more than twenty years, Mr. President, the Federal govern- 
 ment has been engaged in an almost unceasing effort to secure to 
 itself the control of that great instrument of association known as 
 money the professed object of all its labors in that direction, 
 having been, the establishment of what has been termed ' ' a hard 
 money currency," to the entire exclusion of the paper circulation. 
 The more it has labored, however, the less has been the stability 
 of the currency the periods distinguished by its most earnest 
 efforts, having been those in which we have been most compelled 
 to dispense with the use of the precious metals. But recently, 
 money, as we were told, abounded the channels of circulation 
 having been, everywhere, filled with gold. Now, money of every 
 kind, has almost altogether disappeared. "There is scarcely," 
 says a recent traveller, " an Eastern bank-note to be found west 
 of Cleveland, and any few dollars that may straggle this way 
 are eagerly snapped up and sent East as a remittance. Gold is 
 hidden, where it still lingers ; but very much not only of this, but 
 of silver change, has been gathered up and sent East. Nebraska 
 bank-notes, generally of dubious solvency, and uniformly convert- 
 ible into specie, or Eastern paper, only at a ruinous discount, cor- 
 poration shinplasters, and even individual shinplasters none of 
 them regarded as of any value far outside of the shadow of the 
 tall ' Banks ' whence they are issued are the accepted substitutes 
 for money in most localities upon, and west of, the Mississippi. 
 One of the Hutchinson brothers who are now here, singing their 
 way Eastward, from their new home in Minnesota informed me, 
 that he has been singing along four hundred miles, through Min- 
 nesota and Iowa taking grain for music, wherever cash was un- 
 attainable, and has done very well by it. In one instance, a 
 farmer drove up with eight bushels of corn in his sleigh, and his 
 wife and six children seated thereon, saying, ' We have no money, 
 but we all want to hear you, and corn is the best we can give you. ' 
 He accepted the corn very gladly, gave eight twenty-five-cent 
 tickets in exchange for it, and sung it out. " 
 
 Similar to this, Mr. President, was the state of things at the 
 close of the first trial of that " free trade " system, which, as you 
 have so clearly seen, we do not, at present, require. So was it, 
 too, in 1840-41, at the close of the second experiment the only 
 difference between it and its predecessor, having been, that the 
 second crisis was far more fearful than the first. So is it, now, 
 when we are fast approaching the close of the third experiment
 
 80 LETTERS TO THE 
 
 each and every trial of the favorite policy of the central govern- 
 ment, thus ending in the total disappearance of that " metallic 
 basis " which it has so much desired to increase. 
 
 Why is this so ? Because, Mr. President, your predecessors 
 seem ever to have reflected, that, to be enabled to use any com- 
 modity, or thing, we must first enable ourselves to get it ; and 
 that, a regular influx of the precious metals is quite as necessary 
 to the maintenance of a hard money circulation, as is an influx 
 of hides and cotton, to enable us to wear shoes and shirts. While 
 asserting that money is a mere commodity, they do not admit that 
 it is subject to the same laws which govern other commodities. 
 Had our policy tended to produce so great an export of cotton 
 as to compel our people to go in rags, no one would have thought 
 of charging the dealers in cotton with crime ; and yet, while pur- 
 suing a policy that has, whenever tried, resulted in the disappear- 
 ance of the precious metals, the fact of inability to produce them 
 when demanded, has always been regarded as evidence of crimi- 
 nality in the banks warranting new additions to the pains and 
 penalties provided by existing laws. Year after year, since the 
 central government undertook the regulation of the currency, have 
 they been increased ; and yet, despite the penalties, suspensions 
 have occurred. They must continue to occur, until the central 
 government shall come to appreciate the value of that very homely 
 proverb, which teaches, that a boy cannot eat a cake and yet 
 have it thence learning, that a community cannot, more than 
 an individual, pursue a course tending to promote the expulsion 
 of the precious metals, and yet enjoy all the advantages attendant 
 upon the maintenance of a specie circulation. 
 
 All commodities, Mr. President, go from those places at which 
 their utility is small, to those at which it is great. Therefore it is, 
 that cotton, wool, and other raw materials, tend towards those 
 places at which employments are most diversified it being there 
 that the products of the farm command the largest quantity of 
 money. Gold and silver follow in the train of raw materials ; and 
 for the reason, tha.t where the farmer and the artisan are most 
 enabled to combine, finished commodities are always cheapest. 
 When Germany exported corn and wool, they were cheap, and 
 she was required to export gold, to aid in paying for the cloth and 
 paper she imported the latter being very dear. Now she im- 
 ports both wool and rags ; her farmers obtain high prices for their 
 products, and are enriched ; and the gold comes to her, because 
 cloth and paper are so cheap, that she sends them to the most dis- 
 tant quarters of the world. So is it with France, Belgium, Swe- 
 den, and Denmark all of which are large importers of raw ma- 
 terials, and of gold. In all those countries, raw materials rise in 
 price ; and the greater the tendency to rise, the more rapidly must 
 the current of the precious metals set in that direction. The
 
 PRESIDENT OF THE UNITED STATES. 81 
 
 country that desires to increase its supplies of gold, and thus 
 lower the price of money, is, therefore, required to pursue the 
 course of policy tending most to raise the prices of raw material, 
 and lower those of manufactures. This, however, is directly the 
 opposite of the policy advocated by the British school, which 
 seeks, in the cheapening of all the raw material of manufactures, 
 the means of advancing civilization. 
 
 The proposition, Mr. President, above submitted for your con- 
 sideration, is a very simple one, and yet, it is by its aid, if at all, 
 that we shall arrive at a correct understanding of the cause of the 
 difficulties under which we labor. The precious metals go from 
 those countries in which employments are least diversified from 
 those, in which agriculture is least a science from those, in which 
 the yield of the land is least from those, in which the land is 
 becoming more and more exhausted from those, in which the 
 prices of the rude products of the 'earth are the lowest from 
 those, that are becoming more and more dependent upon trade 
 from those, in which domestic commerce declines from those, 
 in which men are becoming less free from all those, therefore, 
 which decline in civilization. They go to those countries in which 
 employments are becoming more diversified to those, in which 
 agriculture is becoming more and more a science to those, in 
 which the yield of the land is largest to those, in which the 
 powers of the land increase to those, in which the farmer's pro- 
 ducts command the highest prices to those, which are becoming 
 less dependent upon foreign trade to those, in which there is a 
 steady growth of the domestic commerce to those, in which men 
 are becoming less and less enslaved to all those, therefore, in 
 which, with each successive year, we are more and more presented 
 with those phenomena which indicate advance in civilization. 
 
 Of the machinery in use by man, it is the most serviceable 
 that is last obtained the cart following the camel and the mule 
 the wagon following the cart and the railroad car, with its lo- 
 comotive, following the wagon. Of all the instruments given by 
 the Creator for man's use, money is the one which performs the 
 largest amount of service, in proportion to its cost ; and therefore 
 it is, that it is always the last to be obtained. Countries whose 
 people are limited to the single pursuit of scratching the earth, 
 can neither afford to buy nor keep it. Therefore it is, that the 
 precious metals go from Portugal and Turkey, Brazil and Chili, 
 California and Australia, in both of which latter, the price of 
 money, as indicated by the rate of interest, is higher than in 
 almost any other portion of the world. Countries in which the 
 pursuits of man are diversified those, therefore, in which the 
 prices of agricultural products tend to rise can afford to buy 
 and keep them ; and that such diversification is essential to the 
 existence of the power so to do, is proved by every fact in the
 
 82 LETTERS TO THE 
 
 history of English commerce in the last century, and in those of 
 all the advancing countries of Europe in the present one. That 
 power grows with the growth of domestic commerce, the only 
 sure foundation, as you, Mr. President, have so clearly seen, of a 
 great foreign one. In its existence, therefore, may be found the 
 most conclusive proof of advancing civilization. Which have 
 been the periods at which it has existed among ourselves, and how 
 it has affected the supplies of gold, we may now inquire. 
 
 What was the commerce in the precious metals in the thirty years 
 preceding the discovery of California, is shown by the following 
 figures : 
 
 Excess exports. Excess imports. 
 
 1821-1825 $12,,500,000 
 
 1826-1829 $4,000,000 
 
 1830-1834 20,000,000 
 
 1835-1838 (a period of extensive foreign loans) 34,000,000 
 
 1839-1842 9,000,000 
 
 1843-1847 (foreign debt largely reduced) 39,000,000 
 
 1848-1850 14,000,000 
 
 IntheclosingyearsofthefreetradesystemoflSlf, Mr. President, 
 the average excess of specie export was about $2,500,000 a year. 
 Adding to this a similar amount, only, for the annual consump- 
 tion, we obtain an absolute diminution of five-and-twenty millions 
 the population having, meantime, increased about ten per cent. 
 Under such circumstances, it is no matter of surprise that those 
 years are conspicuous among the most calamitous ones in all our 
 history. At Pittsburg, flour then sold at $1.25 per barrel ; wheat, 
 throughout Ohio, would command but 20 cents a bushel ; while 
 a ton of bar iron required a little short of eighty barrels of flour 
 to pay for it. Such was the state of affairs that produced the 
 tariff of 1824 a very imperfect measure of protection, but one 
 that, imperfect as it was, changed the course of the current, and 
 caused a net import, in the four years that followed, of $4,000,000 
 of the precious metals. In 1828, there was enacted the first 
 tariff tending directly to the promotion of association throughout 
 the country ; and its effects exhibit themselves in an excess import 
 of the precious metals averaging $4, 000, 000 a year notwith- 
 standing the discharge, in that period, of the whole of the national 
 debt that had been held in Europe, amounting to many millions. 
 Putting together the discharge of debt and the import of coin, the 
 balance of trade in that period must have been in our favour to 
 the extent of nearly $50,000,000 ; or an average of about 
 $10,000,000 a year. As a consequence, prosperity existed to an 
 extent never before known the power to purchase foreign com- 
 modities having grown with such rapidity as to render it neces- 
 sary greatly to enlarge the free list ; and then it was, that coffee, 
 tea, and many other raw commodities, were emancipated from
 
 PRESIDENT OF THE UNITED STATES. 83 
 
 the payment of any impost. Thus did efficient protection lead to 
 a freedom of commerce, abroad and at home, such as had never 
 before existed. 
 
 The first few years of the compromise tariff of 1833, profited 
 largely by the prosperity caused by the act of 1828, and the re- 
 ductions under it, were then so small, that its operation was but 
 slightly felt. In those years, too, there was contracted an enor- 
 mous foreign debt stopping the export of specie, and producing 
 an excess import averaging more than $8,000,000 a year. Pros- 
 perity seemed to exist, but it was of the same description that has 
 marked the last few years, during which the value of all property 
 has depended entirely upon the power to contract debts abroad 
 thus placing the nation more completely under the control of its 
 distant creditors. 
 
 In the succeeding years, the compromise became more fully 
 operative.* Furnaces and factories were closed, with constantly 
 increasing necessity for looking abroad for the performance of all 
 exchanges, and corresponding necessity for remitting money to 
 pay the balance due on the purchases of previous years. Never- 
 theless, the annual specie export averaged little more than 
 $2,000,000; but if to this be added, a consumption of only 
 $3,000,000 a year, we have a reduction of $20,000,000 ; the con- 
 sequences of which were seen, in an almost total suspension of 
 domestic commerce. The whole country was in a state of ruin. 
 Laborers were everywhere out of employment, and being still con- 
 sumers, while producing nothing, the power of accumulation ceased, 
 almost, to exist. Debtors being every where at the mercy of creditors, 
 sales of real estate were chiefly accomplished by help of the sheriff, 
 whose perquisites were then larger than they had been at any time 
 from the date of the Constitution. 
 
 The change in the value of labor, consequent upon the stoppage 
 of the circulation that followed this trivial export of the precious 
 metals, cannot, Mr. President, be placed at less than $500,000,000 
 a year. Wages were low, even where employment could be ob- 
 tained ; but a large portion of the labor-power of the country was 
 totally wasted, and the demand for mental power diminished even 
 more rapidly than that for physical exertion. In the prices of 
 land, houses, machinery of all kinds, and other similar property, 
 the reduction counted by thousands of millions of dollars ; and 
 yet, the difference between the two periods ending in 1833 and 
 1842, in regard to the monetary movement, was only that between 
 an excess import of $5,000,000, and an excess export of 
 $2,500,000, or a total of $T, 500,000 a year. No one who 
 
 * One-tenth of the excess over 20 per cent, was reduced in December, 
 1833; another tenth in 1835; a third in 1837; a fourth in 1839; the re- 
 maining excess of duties being then equally divided into two parts, to be 
 reduced in 1841 and 1842.
 
 84 LETTERS TO THE 
 
 studies these facts, can fail to be struck with the wonderful power 
 over the fortunes and conditions of men, exerted by the metals 
 provided by the Creator, for furthering the work of association 
 among mankind. With the small excess of import in the first 
 period, there was a steady tendency towards equality of condition 
 among the poor and the rich, the debtor and the creditor ; where- 
 as, with the slight excess of export in the second one, there was a 
 daily increasing tendency towards inequality the poor laborer 
 and the debtor, passing steadily more under the control of the rich 
 employer, and the wealthy creditor. 
 
 Of all the machinery furnished for the use of man, there is none, 
 Mr. President, so equalizing in its tendency as that known by the 
 name of money ; and yet economists would have the world believe 
 that the agreeable feeling which, everywhere, attends a knowledge 
 that it is flowing in, is evidence of ignorance any reference to 
 the question of the favorable or unfavorable balance of trade, be- 
 ing beneath the dignity of men who fancy they are following in 
 the footsteps of Hume and Smith. It would, however, be as 
 difficult to find a single prosperous community that is not, from 
 year to year, making itself a better customer to the gold-producing 
 countries, as it would be to find one that is not becoming a better 
 customer to those which produce silk, or cotton. To be an im- 
 proving customer, there must be in its favor a steadily increasing 
 balance of trade, to be settled by payment in the commodity for 
 whose production the country is fitted, whether that be cloth, or 
 tobacco, silver or gold. 
 
 The condition of the nation at the date of the passage of the 
 act of 1842, was, Mr. President, humiliating in the extreme. The 
 Treasury unable to obtain at home the means required for ad- 
 ministering the government, even on the most economical scale 
 had failed in all its efforts to negotiate a loan at six per cent., 
 even in the same foreign markets in which it had but recently paid 
 off, at par, a debt bearing an interest of only three per cent. 
 Many of the States, and some even of the oldest of them, had 
 been forced to suspend the payment of interest on their debts. 
 The banks, to a great extent, being in a state of suspension, those 
 which professed to redeem their notes, found their business greatly 
 restricted by the increasing demand for coin to go abroad. The 
 use of either gold or silver as currency had almost altogether 
 ceased. The Federal government, but recently so rich, was driven 
 to the use of inconvertible paper money, in all its transactions 
 with the people. Of the merchants, a large portion had become 
 bankrupt. Factories and furnaces being closed, hundreds of 
 thousands of persons were totally unemployed. Commerce had 
 scarcely an existence those who could not sell their own labor, 
 being unable to purchase that of others. 
 
 Nevertheless, deep as was the abyss into which the nation had
 
 PEESIDENT OF THE UNITED STATES. 85 
 
 been plunged, so magical was the effect of the adoption of a sys- 
 tem tending to the creation of a favorable balance of trade, that 
 scarcely had the act of August, 1842, become a law, when the 
 government found that it could have all its wants supplied at 
 home. Mills, factories, and furnaces, long closed, were again 
 opened ; labor came again into demand ; and, before the close 
 of its third year, prosperity almost universal reigned. States 
 recommenced the payment of interest on their debts. Railroads 
 and canals again paid dividends. Real estate had doubled in 
 value, and mortgages had been everywhere lightened ; and yet 
 the total net import of specie in the first four years, was but 
 $17,000,000, or $4,250,000 per annum ! In the last year occurred 
 the Irish famine, creating a great demand for food ; the conse- 
 quence of which was, an import of no less than $22,000,000 of 
 gold making a total import, in five years, of $39,000,000. 
 Deducting from this but $4,000,000 per annum for consumption, 
 it leaves an annual increase, for the purposes of circulation, of 
 less than $5,000,000 ; and yet the difference in the prices of labor 
 and land in 1847, as compared with 1842, would be lowly esti- 
 mated, if placed at only $2,000,000,000. 
 
 With 1847, however, there came another change of policy 
 the nation being again called upon to try the system under which 
 it had been prostrated in 1840-'42. The doctrines of Hume and 
 Smith, in reference to the balance of trade, were again adopted 
 as those by which a government was to be directed in its move- 
 ments. Protection being then repudiated, the consequences were 
 speedily seen in the fact, that within three years, factories and fur- 
 naces were again closed, labor was seeking demand, and gold was 
 flowing out even more rapidly than it had come in, under the 
 tariff of 1842. The excess export of those three years amounted 
 to $14,000,000 ; and if to this be added $15,000,000 for con- 
 sumption, it follows that the reduction was equal to the total 
 increase under the previous system. Circulation was rapidly 
 diminishing, and a crisis was close at hand, when, fortunately 
 for the advocates of the existing system, the gold deposits of Cali- 
 fornia were brought to light. Since that time, we have exported 
 some hundreds of millions of dollars of gold, and have contracted 
 some hundreds of millions of foreign debt ; and the result is seen, 
 in the facts, that money has ceased to circulate that the primi- 
 tive form of barter is taking the place of the more civilized form 
 of purchase and sale that merchants, by thousands, are utterly 
 bankrupt that counties, towns, and cities, are unable to pay the 
 interest on their debts that commerce scarcely exists and that, 
 the Federal treasury is forced to the use of treasury notes, which 
 are already at a discount, when compared, even, with irredeem- 
 able bank notes. 
 
 Such, Mr. President, is the result, as thus far reached, of the
 
 86 LETTERS TO THE 
 
 regulation of the currency by the central government. Such most 
 it continue to be, and for the reason that, while the government 
 is unceasing in its efforts to compel the people to forego the use 
 of bank notes, it is equally unceasing in its efforts to reduce the 
 prices of all the products of the soil, and thus compel the export of 
 the precious metals. Under a different policy, gold and silver 
 flowing steadily in would gradually take the place of paper ; 
 but, under the existing one, if fully carried out, we must be reduced 
 to barter bank notes not being permitted to circulate, and the 
 precious metals not being permitted to remain amongst us. Look 
 in what direction we may, Mr. President, we meet, at home, with 
 evidences of declining civilization ; but nowhere can higher proof 
 be found, than in the history of the crusade of the central govern- 
 ment against the local banks and their circulation. 
 Yours, very respectfully, 
 
 HENRY C. CAREY. 
 Philadelphia, January 29th, 1858.
 
 PRESIDENT OF THE UNITED STATES. 87 
 
 LETTER SIXTEENTH. 
 
 " IN every kingdom into which money begins to flow in greater 
 abundance than formerly, everything," says Mr. Hume, in his 
 well-known Essay on Money, "takes a new face : labor and in- 
 dustry gain life ; the merchant becomes more enterprising, the 
 manufacturer more diligent and skilful ; and even the farmer fol- 
 lows his plough with more alacrity and attention." 
 
 That this is so, Mr. President, is well known to all. Why 
 should it be so ? Because the circulation of society then increases, 
 and all power whether in the physical or social world results 
 from motion. When money is flowing in, every man is enabled 
 to find a purchaser for his labor, and to become a purchaser of 
 that of others. Therefore has it been, that commerce has so 
 steadily increased in those countries in which the Californian and 
 Australian products have so rapidly accumulated France, Ger- 
 many, and Northern and Western Europe generally. When, on 
 the contrary, money flows out, the circulation diminishes, and 
 labor is everywhere wasted. That labor-power being capital, the 
 result of the consumption of other capital in the form of food, 
 all the difference between an advancing and a declining state of 
 society, is found in the fact, that in the one, there is a constant 
 increase in the rapidity with which the demand for muscular or 
 mental power follows its production, while in the other, there is 
 a daily diminution therein. The more instantly the demand fol- 
 lows the supply, the more is the force economized, and the larger 
 is the power of accumulation. The longer the interval between 
 production and consumption, the greater is the waste offeree, and 
 the less is the power of accumulation. 
 
 Of all the machinery in use among men, there is none that exer- 
 cises upon their actions so great an influence, as that which gathers 
 up and divides and subdivides, and then gathers up again, to be 
 on the instant divided and subdivided again, the minutes and 
 quarter-hours of a community. It is the machinery of association, 
 and the indispensable machinery of progress ; and therefore it is, 
 that we see in all new, or poor, communities so constant an effort 
 to obtain something to be used in its stead ; as is shown in various 
 countries in which an irredeemable paper constitutes the medium 
 of exchange. Throughout the West, a currency of some descrip- 
 tion is felt to be among the prime necessities of life. So well is 
 this want understood, that many Eastern banks supply notes ex- 
 pressly for Western circulation the people there passing them 
 from hand to hand, because any money is better than none, and 
 good they cannot get, for the reason that metallic money always 
 flows from the place where the charge for its use is high, to that
 
 88 LETTERS TO THE 
 
 at which it is low. The rate of interest in the West is now enor- 
 mous, but each successive day witnesses the export of gold to the 
 East,'whcre it is somewhat less ; and yet, even our high interest 
 ranging, as it has done for years, between ten and thirty per cent. 
 per annum cannot prevent it from going to France and Ger- 
 many, where it commands but five or six per cent. Money thus 
 obeys the same law as water seeking always the lowest level. 
 The latter falls upon the hills, but, from the moment of its fall, it 
 never stops until it reaches the ocean ; nor does the gold of Cali- 
 fornia, or the silver of Mexico, stop until it reaches that point at 
 which money most abounds, and at which, for that reason, the 
 price paid for its use is lowest. 
 
 Of all the commodities in. use by man, the precious metals are 
 those, Mr. President, whose movements furnish the most perfect 
 test of the soundness, or unsoundness, of its commercial system. 
 They go from those countries whose people are engaged in ex- 
 hausting the soil, to those in which they renovate and improve it. 
 They go from those at which the price of raw products, and the 
 land itself, is low from those at which money is scarce, and 
 interest is high. The country that desires to attract them, and 
 thus to lower the charge for the use of money, has, then, only to 
 adopt the measures required for raising the price of land and 
 labor. In all countries, the value of land grows with that de- 
 velopment of the human faculties which results from diversity in 
 the modes of employment, and consequent growth of the power 
 of combination. That power grows in all the countries of North- 
 ern Europe ; and for the reason, as has been shown, that all those 
 countries have adopted the course of policy recommended by Col- 
 bert, and carried out by France. It declines in Great Britain, in 
 Ireland, in Portugal, in Turkey, in the Eastern and Western In- 
 dies, and in all countries that follow the teachings of the British 
 school. It has grown among ourselves in every period of protec- 
 tion ; and then money having flowed in land and labor have 
 risen in value. It has diminished in every period in which foreign 
 trade has obtained the mastery over domestic commerce. Land 
 and labor have always declined in value as soon as our people 
 had eaten, drunk, and worn foreign merchandise to the extent 
 of hundreds of millions of dollars, beyond the value of their ex- 
 ports of the rude products of the soil, and have thus compelled 
 the withdrawal of the " metallic basis " of their paper circulation. 
 
 We are told, however, by the same writer Mr. Hume and 
 in that he is followed by the modern economists that the only 
 effect of an increase of the supply of gold and silver is that of 
 "heightening the price of commodities, and obliging every one to 
 pay more of those little yellow or white pieces for everything he 
 purchases." Were such really the case, it would be little short of a 
 miracle, that we should see money always, century after century, 
 passing in the same direction to the countries that are rich
 
 PRESIDENT OF THE UNITED STATES. 89 
 
 from those that are poor ; so poor, too, that they cannot afford 
 to keep as much of it as is required for their own exchanges.. 
 The gold of Siberia leaves a land in which so little circulates, that 
 labor and its products are at the lowest prices, to find its way to 
 St. Petersburg, where it will purchase less labor, and less of either 
 wheat or hemp, than it would do at home ; and that of Carolina 
 and Virginia goes steadily and regularly, year after year, to the 
 countries to which the people of those States send their cotton 
 and their wheat, because of the higher prices at which they sell. 
 The silver of Mexico, and its cochineal, travel together to the 
 same market ; and the gold of Australia passes to Britain by the 
 ship which carries the wool yielded by the flocks. 
 
 Every addition to the stock of money, as we are assured by the 
 ingenious men of modern days, engaged in compiling treasury tables 
 and finance reports, renders a country a good place to sell in, but 
 a bad one in which to purchase. To what countries, however, is 
 it, that men have most resorted when they desired to purchase ? 
 Have they not, until recently, gone, almost exclusively, to Britain ? 
 It has been so, assuredly ; and for the reason, that there it has 
 been, that finished commodities were cheaply furnished. Where 
 have they gone to sell ? Has it not been to Britain ? It certainly 
 has been so ; and for the reason, that there it was?, that gold, cot- 
 ton, wheat, and all other of the rude products of the earth, were 
 dear. Where do they now most tend to go when they desire to 
 purchase cloths or silks ? Is it not to France and Germany ? So 
 it certainly is ; and for the reason, that there it is that raw mate- 
 rials are highest, and finished ones are cheapest. Gold follows in 
 the train of raw materials generally these last being found, in- 
 variably, travelling to those places at which the rude products of 
 the earth command the highest prices, while cloth, iron, and manu- 
 factures of iron and other metals, maybe purchased at the lowest; 
 and the greater the flow in that direction, the greater is the ten- 
 dency to further enhancing the prices of the former, and reducing 
 those of the latter. From this it would seem, Mr. President, that 
 increase in the supply of money, so far from having the effect of 
 causing men to give two pieces for an article that could before 
 have been had for one, has, on the contrary, that of enabling 
 them to obtain for one piece the commodity that before had cost 
 them two; and that such is the fact, can readily be shown. 
 
 The stock of gold among ourselves, has, within the last few 
 years, been much increased ; and yet, so far is it, from producing 
 the effects above described, that the prices of wheat, cotton, to- 
 bacco, and all our other products, now steadily decline, and the 
 farmer and planter have in prospect, lower prices than they have 
 ever seen. Why, Mr. President, is this the case ? Because, for 
 more than twenty years, the central government has been engaged 
 in an almost unceasing effort to promote the habit of hoarding 
 the precious metals, and thus by lessening their power of circu-
 
 90 LETTERS TO THE 
 
 lation has almost annihilated their utility. Because, in the 
 vain hope of establishing, by means of such measures, " a hard 
 money currency," it has waged an almost unceasing war upon 
 public and private credit prohibiting the use of circulating 
 notes in all transactions in which it is itself concerned, and urging 
 upon the local authorities, the necessity for following its example. 
 With it, freedom of trade in reference to the most important of 
 all the commodities in use by man, has not consisted in letting 
 the people think and act for themselves, but in compelling them 
 to act in obedience to its mandates. 
 
 The use of circulating notes tends, however, as we are assured, 
 to promote the expulsion of gold. Were it to do so, Mr. Presi- 
 dent, it would be in opposition to the great general law, in virtue 
 of which all commodities tend to, and not from., the places at 
 which their utility is greatest. Cotton-wool tends to go from 
 the plantation, and to the mill. Hides tend to go from the farm, 
 and to the tanner's yard. Gold and silver tend to go from Peru 
 and California, and to those places at which such metals are most 
 required in the arts, and at which industry is most diversified 
 the same laws thus governing all commodities, be they what 
 they may. 
 
 A bank, Mr. President, is a machine for utilizing money, by 
 enabling A, B, and C, to obtain the use of it at the time when 
 D, E, and F, its owners, do not need its services. The direct 
 effect of the establishment of such institutions in European cities 
 has always been to cause money to flow towards those cities ; and 
 for the reason, that there its utility stood at the highest point. 
 Even then, however, there were difficulties attendant upon the 
 change of property in the money deposited with the bank the 
 owner having been required to go to the banking-house, and write 
 it off to other parties. To obviate this difficulty, and thus increase 
 the utility of money, its owners were at length authorized to draw 
 checks, by means of which they were enabled to transfer their 
 property without stirring from their houses. 
 
 The difficulty still, however, existed, that private individuals 
 not being generally known such checks could, in general, effect 
 but a single transfer ; and thus, the recipient of money found 
 himself obliged to go through the operation of taking possession 
 of that which had been transferred to him, after which he had, in 
 his turn, to draw a check, when he himself desired to effect an- 
 other change of property. To obviate this, circulating notes were 
 invented, by help of which the ownership of money is now trans- 
 ferred with such rapidity, that a single hundred dollars passes 
 from hand to hand fifty times a day effecting exchanges, per- 
 haps, to the extent of many thousand dollars, and without the 
 parties being at any time required to devote even a single instant 
 to the work of counting coin. This was a great invention, by 
 aid of which the utility of money was so much increased, that a
 
 PEESIDENT OF THE UNITED STATES. 91 
 
 single thousand pieces could be made to do more work than, with- 
 out it, could be done by hundreds of thousands. 
 
 This, of course, as we are told, supersedes gold and silver, and 
 causes them to be exported. So we are certainly assured, by those 
 economists who regard man as an animal that must be fed, and 
 will procreate as a slave, who can be made to work only under 
 the pressure of a strong necessity. Were they, however, to look, 
 for once, at the real MAN the being made in the image of his 
 Creator, and capable of almost infinite elevation they would, 
 perhaps, arrive at a conclusion widely different. The desires of 
 that man being infinite, the more they are gratified, the more 
 rapidly do they increase in number. The miserable Hottentot 
 dispenses with a road of any kind, but the enlightened and intel- 
 ligent people of other countries, are seen passing in succession 
 from the ordinary village road to the turnpike, and thence to the 
 railroad ; and the better the existing communications, the greater 
 is the thirst for further improvement. The better the schools 
 and houses, the greater is the desire for superior teachers, and for 
 further additions to the comforts of the dwelling. The more per- 
 fect the circulation of society, the larger is the reward of labor, 
 and the greater is the power to purchase gold and silver, to be 
 used for the various purposes for which they are so admirably 
 fitted ; and the greater is the tendency to have them flow to the 
 places at which that circulation is established. Money promotes 
 the circulation of society. The check and the bank note stimu- 
 late that circulation giving thereby value to labor and land; 
 and wherever checks and notes are most in use, there, Mr. Presi- 
 dent, should the inward current of the precious metals be most 
 fully and firmly established. 
 
 That such is the case, is proved by the facts, that, for a century 
 past, the precious metals have tended most to Britain, where such 
 notes were most in use. Their use increases rapidly in France, 
 with constant increase in the inward flow of gold. So, too, does 
 it in Germany, towards which the auriferous current now sets so 
 steadily, that notes which are the representatives of money, are 
 rapidly taking the place of those irredeemable pieces of paper, by 
 which the use of coin has so long been superseded. 
 
 Whence flows all this gold ? From the countries in which em- 
 ployments are not diversified ; from those, in which there is little 
 power of association and combination ; from those, in which, there- 
 fore, credit has no existence ; from those, finally, which do not 
 use that machinery which so much increases the utility of the pre- 
 cious metals, and which we are accustomed to designate by the 
 term bank-note. The precious metals go from California from 
 Mexico from Peru from Brazil from Turkey and/rom 
 Portugal the lands in which property in money is transferred 
 only by means of actual delivery of the coin itself to those, in 
 which it is transferred by means of a check, or note. They go from
 
 92 LETTERS TO TUB 
 
 the plains of Kansas, where notes are not in use, to New York 
 and New England, where they are from Siberia to St. Peters- 
 burg from the banks of African rivers to London and Liver- 
 pool and from the "diggings " of Australia to the towns and 
 cities of Germany, where wool is dear and cloth is cheap. 
 
 All the facts exhibited throughout the world tend, Mr. Presi- 
 dent, to prove that every commodity seeks that place at which it 
 has the highest utility ; and -all those connected with the move- 
 ment of the precious metals prove that they constitute no excep- 
 tion to the rule. Bank notes increasing the utility of those 
 metals should, therefore, attract, and not repel, them. Never- 
 theless, the two nations of the world which claim best to under- 
 stand the principles of commerce, are now engaged in a crusade 
 against such notes ; and in the vain hope of thereby rendering 
 their several countries more attractive of the produce of the mines 
 of Peru and Mexico, Australia and California. The result is 
 seen in the fact, that both are nearly bankrupt. 
 
 It is a great mistake ; and its existence here is due to the fact, 
 that our system of policy tends to that expulsion of the precious 
 metals, which always must result from the long-continued export 
 of the raw products of the earth. The administration that 
 adopted what is called free trade, was the same that commenced 
 the system of compelling the community to use gold instead of 
 notes ; and the result was found in the total disappearance of 
 coin from circulation. From that time to the present, the 
 motto of the generally dominant party of the Union has been 
 "War to the death against bank notes"; and, with a view to 
 promote their expulsion, laws have been passed in various States, 
 forbidding their use, except when of too great size to enter freely 
 into the transactions of the community. As must, however, in- 
 evitably be the case, the tendency to the loss of the precious 
 metals has always been in the direct ratio of the diminution in 
 their utility thus produced. At one time only, in almost twenty 
 years, has there been an excess import of those metals, and that 
 was under the tariff of 1842. Then, money became abundant 
 and cheap ; because the policy of the country looked to the pro- 
 motion of association and the extension of domestic commerce. 
 Now, it is scarce and dear ; because that policy limits the power 
 of association, and establishes the supremacy of trade. 
 
 Careful study of these facts, can scarcely, Mr. President, fail to 
 satisfy you, that the cause of difficulty lies wholly in the central 
 government ; and that, to that government it is, we are to look 
 for change. The expansions and contractions of which you 
 so much, and so justly too, complain, having all occurred in those 
 periods in which the policy of the Union has tended towards the 
 sacrifice of domestic commerce towards the exhaustion of the 
 soil towards the depression of the prices of the farm and the 
 plantation and towards the expulsion of our people from the
 
 PRESIDENT OP THE UNITED STATES. 93 
 
 older States, the remedy is to be found in the adoption of one 
 which shall look to the extension of domestic commerce to the 
 creation of a real agriculture to the elevation of the rewards 
 of labor employed upon the land and to the concentration of 
 our population. That policy, Mr. President giving us that 
 real free trade which you so much admire would enable us to 
 import, and to retain, abundant supplies of the precious metals, 
 and thus to establish, upon a sure foundation, the hard money 
 currency you so anxiously desire. 
 
 " No other nation," as you most truly say, "has ever existed, 
 which could have endured such violent expansions and contrac- 
 tions of paper credits, without lasting injury." No other nation 
 has been so unfortunate as to have a government always at war 
 with public and private credit ; and none other, after so long a 
 period of 'intestine war, could have retained so much vitality. 
 Let the central government, Mr. President, review its action 
 during the last twenty years let it see that its policy has looked 
 to the destruction of that internal commerce upon which, alone, 
 a prosperous foreign one can be built let it follow in the foot- 
 steps of the patriots of the Revolution and your hopes in the 
 future will all be realized "the buoyancy of youth, the energies 
 of our population, and the spirit which never quails before diffi- 
 culties, " then, but not otherwise, enabling us "to recover from 
 our financial embarrassments, " and " even occasioning us speedily 
 to forget the lessons they have taught." Each and every period 
 of what is called free trade, having ended in bankruptcy, on each 
 and every occasion, general wealth, peace, happiness, and con- 
 stantly increasing power, have resulted from the adoption of pro- 
 tection. So, Mr. President, must it ever be the depression and 
 ruin of the agricultural interest being the necessary consequences 
 of the former of these systems, and its elevation having always 
 resulted from the adoption of the latter. 
 With great respect, 
 
 Your obed't servant, 
 
 HENRY C. CAREY. 
 
 Philadelphia, February 2d, 1858.
 
 94 LETTERS TO THE 
 
 LETTER SEVENTEENTH. 
 
 CIVILIZKD communities those communities, Mr. President, 
 which have obtained that freedom of domestic intercourse which, 
 as you have seen, we so sorely need follow the advice of Adam 
 Smith, in exporting their wool, and their corn, in the form of 
 cloth, at little cost for transportation. Thus, France, in 1856, 
 exported silks and cloths, clothing, paper, and articles of furni- 
 ture, to the extent of $300,000,000 ; and yet the total weight was 
 short of 40,000 tons requiring for its transport but forty ships 
 of very moderate size. 
 
 Barbarous, and semi-barbarous countries, on the contrary', ex- 
 port their commodities in their rudest state, at heavy cost for trans- 
 portation. India sends the constituents of cloth cotton, rice, 
 and indigo to exchange, in distant markets, for the cloth itself. 
 Brazil sends raw sugar across the ocean, to exchange for that 
 which has been refined. We send wheat and Indian corn, pork 
 and flour, cotton and rice, fish, lumber, and naval stores, to be 
 exchanged for knives and forks, silks and cottons, paper and 
 China-ware. The total value of these commodities exported in 
 1856 high as were then the prices was only $230,000, 000 ; and 
 yet, the American and foreign ships engaged in the work of trans- 
 port, were of the capacity of 6,872,253 tons requiring for their 
 management no less than 269,000 persons.* 
 
 In the movement of all this property, Mr. President, there is 
 great expense for transportation. Who pays it ? Ask the farmer 
 of Iowa, and he will tell you, that he sells for 15 cents and that, 
 too, payable in the most worthless kind of paper a bushel of 
 corn that, when received in Manchester, commands a dollar ; and 
 that he, in this manner, gives to the support of railroads and 
 canals, ships and sailors, brokers and traders, no less than eighty- 
 Jive per cent, of the intrinsic value of his products. Ask him 
 once again, and he will tell you, that while his bushel of corn 
 will command, in Manchester, 18 or 20 yards of cotton cloth, he 
 is obliged to content himself with little more than a single yard 
 eighty-Jive per cent, of the clothing power of his corn having 
 been taken, on the road, as his contribution towards the tax im- 
 posed upon the country, for the maintenance of the machinery of 
 that "free trade" which, as you, Mr. President, have so clearly 
 seen, is the sort of freedom we do not, at present, need. 
 
 The country that exports the commodity of smallest bulk, is 
 
 * This is the total tonnage that arrived from foreign countries, in that 
 year. A small portion was required for the transport of manufactured com- 
 modities, but it was so small as scarcely to require notice.
 
 PRESIDENT OF THE UNITED STATES. 95 
 
 almost wholly freed from the exhausting tax of transportation. 
 At Havre ships being little needed for the outward voyage, 
 while ships abound the outward freights must be always very low. 
 
 The community that exports the commodities of greatest bulk, 
 must pay nearly all the cost of transportation. A score of ships 
 being required to carry, from our ports, the lumber, wheat, or 
 naval stores, the tobacco, or the cotton, required to pay for a 
 single cargo of cloth, the outward freights must always be at, or 
 near, that point which is required to pay for the double voyage 
 and every planter knows, to his cost, how much the price of his 
 cotton is dependent upon the rate of freight. 
 
 In the first of these, Mr. President, employments become, from 
 day to day, more thoroughly diversified the various human 
 faculties become more and more developed the power of com- 
 bination tends steadily to increase agriculture becomes more 
 and more a science the land becomes more productive the 
 societary movement becomes more stable and regular and the 
 power to purchase machinery of every kind, whether ships, mills, 
 or the precious metals, tends steadily to augment. 
 
 In the last, the reverse of this is found the pursuits of men 
 becoming less diversified the demand for human faculty becom- 
 ing more and more limited to that for mere brute force, or for the 
 craft by which the savage is so much distinguished the power 
 of association tending to decline agriculture becoming less and 
 less a science, and the land becoming more and more exhausted 
 the societary movement acquiring, more and more, the fitfulness 
 and irregularity of movement you have so well described, as exist- 
 ing among ourselves and the power to obtain machinery of any 
 kind tending steadily to diminish. 
 
 The first of these, Mr. President, may be found in the countries 
 of Central and Northern Europe those which follow in the lead 
 of Colbert and of France. All of these, are gradually emancipating 
 themselves from the most oppressive of all taxes, the tax of trans- 
 portation. All of them, therefore, are moving in the direction of 
 growing wealth and power, with correspondent advance in civiliza- 
 tion, and in freedom. 
 
 The last may be found in Ireland, India, Jamaica, Portugal, 
 Turkey, and these United States the countries which follow in 
 the lead of England. All of these, are becoming more and more 
 subjected to the tax of transportation. All of them, therefore, 
 are declining in wealth and power, in civilization, and in freedom. 
 
 In the first, the land yields more and more with each successive 
 vear w jth constant increase in the power of a bushel of wheat, 
 or a pound of wool, to purchase money. In the last, the land 
 yields less from year to year, with constant tendency to decline in 
 the price of food and cotton. The first, import the precious metals. 
 The last, export them. The first, find daily increase of power to 
 maintain a specie circulation, as the basis of the higher and better
 
 96 LETTERS TO THE 
 
 currency supplied by banks. The last, are gradually losing the 
 power to command a circulation of any kind, and tending, more 
 and more, towards that barbaric system of commerce which con- 
 sists in exchanging labor against food, or wool and corn against 
 cloth. 
 
 We may be told, however, Mr. President, that in return for 
 the eighty-five per cent, of his products that, as we see, is 
 paid by the farmer of Iowa, and by the Texan planter, we are 
 obtaining a magnificent system of railroads that our mercantile 
 marine is rapidly increasing that, by its means, we are to secure 
 the command of the commerce of the world, &c. , &c. How far 
 all this is so, we may now inquire. To me, it certainly appears, 
 that if this be, really, the road to wealth and power it would 
 be well to require the exportation of wheat instead of flour, paddy 
 in place of rice, cotton in the seed, corn in the ear, and lumber in 
 the shape of logs, rather than in that of planks. 
 
 Looking, first, to our internal commerce, we find a mass of 
 roads, most of which have been constructed, by help of bonds, 
 bearing interest at the rate of 6, 8, or 10 per cent. bonds that 
 have been disposed of, in the market, at 60, 70, or 80 per cent. 
 of their nominal value, and could not now, probably, be re-sold 
 at more than half the price at which they were originally bought. 
 Half made, and little likely ever to be completed, these roads are 
 worked at great expense while requiring constant and great 
 repairs. As a consequence of this it is, that the original pro- 
 prietors have almost wholly disappeared the stock being of little 
 worth. The total amount applied to the creation of railroads hav- 
 ing been about $1000,000,000, and the average present value 
 scarcely exceeding 40, if even 30, per cent., it follows that 
 $600,000,000 have been sunk,. and with them, all power to make 
 new roads. Never, -at any period of our history, have we been, 
 in this respect, so utterly helpless as at present. Nevertheless, 
 the policy of the central government looks steadily to the disper- 
 sion of our people, to the occupation of new territories, to the 
 creation of new States, and to the production of a necessity for 
 further roads. That, Mr. President, is the road to physical and 
 moral decline, and political death, as will soon be proved, unless 
 we change our course. 
 
 The railroad interest being in a state of utter ruin, we may now 
 turn to the shipping one, with a view to see how far we are likely, 
 by its aid, to obtain that command of the commerce of the world, 
 so surely promised to us, by the author of the tariff of '46. 
 Should that prove to be moving in the same direction, the fact 
 will certainly afford new and stronger proof of the perfect accu- 
 racy of your own views, Mr. President, as to the sort of freedom 
 we so much require. 
 
 In a state of barbarism person and property being insecure 
 the rate of insurance is high. Passing thence towards civiliza-
 
 PRESIDENT OF THE UNITED STATES. 97 
 
 tion, security increases, and the rate of insurance declines, as we 
 see it to be so rapidly doing, in reference to fire, in all the ad- 
 vancing countries of Europe. Our course, in reference to ship- 
 ping, being in the opposite direction security diminishing, when 
 it should increase the rate of insurance steadily advances, as 
 here is shown : 
 
 Bates of Insurance upon American Ships. 
 
 1846. 1858. 
 
 To Cuba 1J percent 1J to 2 percent. 
 
 "Liverpool ij " l| to 2 " 
 
 " India and China If " 2 " 
 
 To and from Liverpool, on packet- 
 ships, annual rates 5 " 8 " 
 
 To what causes, Mr. President, are we to attribute this extra- 
 ordinary change ? May it not be found in the fact, that the more 
 we abandon domestic commerce, and the larger the amount of 
 taxation imposed upon our farmers for the maintenance of trans- 
 portation, the greater becomes the recklessness of those who gain 
 their living out of that taxation ? Look back to the last free trade 
 period that from 1837 to 1841 and you will find phenomena 
 corresponding precisely with those which are now exhibited, 
 although not so great in magnitude. At present, the utter reck- 
 lessness the total absence of conscientious feeling .here exhi- 
 bited, is such as to astonish the thinking men of Europe. 
 Railroad accidents have become so numerous as scarcely to attract 
 even the momentary attention of the reader, and the loss of life 
 becomes greater from year to year. Steamers are exposed to the 
 storms of the lakes, that are scarcely fit to navigate our rivers. 
 Ships that are unfit for carrying insurable merchandise, are em- 
 ployed in the carriage of unfortunate passengers they being the 
 only commodity, for whose safe delivery the ship-owner cannot be 
 made responsible. Week after week, the records of our own and 
 foreign courts, furnish new evidence of decline in the feeling of re- 
 sponsibility which, thirty years since, characterized the owners of 
 American ships, and the men therein employed. 
 
 Look where we may, Mr. President, on the sea, or on the land, 
 evidences of demoralization must meet our view. " Stores and 
 dwellings " and here I give the words of a New York journal 
 " are constructed of such wretched materials as scarcely to be able 
 to sustain their own weight, and with apologies for walls which 
 tumble to the ground, after being exposed to a rain of a few hours' 
 duration, or to a wind which possesses sufficient force to set the 
 dust on the highways in motion. Entire blocks of edifices are 
 put up, with the joists of all so connected with each other, as to 
 form a complete train for the speedy communication of fire from 
 one to another. Joists are built into flues, so that the ends are 
 exposed to becoming first heated, and then ignited by a flying spark. 
 7
 
 98 LETTERS TO THE 
 
 Rows of dwellings and warehouses are frequently covered with a 
 single roof, which has not, in its whole extent of combustible ma- 
 terial, a parapet wall, or other contrivance, to prevent the spread 
 of the flames in the event of a conflagration." 
 
 The feeling of responsibility, Mr. President, grows with the 
 growth of real civilization. It declines with the growth of that 
 mock civilization, but real barbarism, which has its origin in the 
 growing necessity for ships, wagons, and other machinery of trans- 
 portation. The policy of the central government tends steadily 
 towards its augmentation, and hence it is, that American shipping 
 so steadily declines in character, and in the proportions which it 
 bears to that of the foreigners with whom we are required to 
 compete. 
 
 Two years since, we were told, that our shipping already ex- 
 ceeded 5,000,000 tons that we had become the great maritime 
 power of the world and, of course, that this great fact was to 
 be received as evidence of growing wealth and power. Last year, 
 however, exhibited it as standing at only 4,871,000 tons, and 
 future years are likely to show a large decrease ships having 
 become most unprofitable. More than four-fifths of the products 
 of Western farms, and South-western plantations, are, as we have 
 seen, taken for the support of railroads and ships ; and yet, the 
 roads are bankrupt, while the ships have done little more, for some 
 years past, than ruin the men who owned them. Such being the 
 case, it seems little likely, that it is by means of sailing ships we 
 are to acquire that control of the commerce of the world, so con- 
 fidently promised when, in 1846, we were led to abandon the 
 policy which looked to the creation of a domestic commerce, as 
 the true foundation of a great foreign one. What are the pros- 
 pects in regard to that higher description of navigation, which 
 invokes the aid of steam, I propose to show in another letter 
 remaining, meanwhile, Mr. President, 
 
 Yours, very respectfully, 
 
 HENRY C. CAREY. 
 Philadelphia, February 6th, 1858.
 
 PRESIDENT OF THE UNITED STATES. 
 
 LETTER EIGHTEENTH. 
 
 EVERY improvement in the construction of the ship tends to 
 lessen the proportion borne by her tonnage, to the weight of the 
 commodities to be moved. Every improvement in the quality of 
 the commodities moved, tends to augment* the proportions borne 
 by the value transported, to the tonnage of the ships required for 
 its transportation. Here, Mr. President, is a simple principle, 
 by aid of which we may, perhaps, be enabled to arrive at some 
 conclusion in reference to the tendency of our present policy 
 progress towards civilization having, everywhere, manifested itself 
 in a diminutio'n in the proportions borne by the machinery of 
 transportation, to the value of the things transported. 
 
 In the first year which followed the adoption of the Compromise 
 tariff, that of 1834-5, we sent abroad, cotton and tobacco, food 
 and lumber, to the amount of $92,000,000 ; and in that year, the 
 shipping, domestic and foreign, that cleared for foreign ports, 
 amounted to 2,030,000 tons. Six years later, in 1840-41, when 
 that tariff had but begun to operate, we exported, of the 
 same rude products, $98,000,000 the quantity of shipping 
 clearing from our ports having, in the same period, risen to 
 2,353,000 tons. Two years since, as has been shown, the total 
 value of these exports was $230,000,000, while the quantity of 
 shipping leaving our ports amounted to little less than seven mil- 
 lions of tons the increase in the former, in twenty years, having 
 been but 150 percent., while that of the latter had been little short 
 of 350 per cent. 
 
 If there is, Mr. President, any single proposition in social 
 science, that cannot be disputed, it is, that wealth, civilization, 
 and power, increase in the ratio of the diminution of the machinery 
 required for performing the work of transportation. On the turn- 
 pike, a single horse performs the work, that before had been done 
 by two ; and, on the railroad, a single car transports as great a 
 weight as, at first, had been done by hundreds of horses and men, 
 carts and wagons. With every movement in that direction, land 
 becomes more valuable, and man becomes more free. With each 
 and every one in the opposite direction, the value of land declines, 
 and man becomes more and more enslaved. 
 
 The first and heaviest tax, Mr. President, to be paid by land 
 and labor is that of transportation ; and it is the only one, to 
 which the claims of the State itself are forced to yield precedence. 
 Increasing in geometrical proportion, as the distance from market 
 increases arithmetically, therefore it is, that agreeably to tables
 
 100 LETTERS TO THE 
 
 recently published, corn that would produce at market $24.75 per 
 ton, is worth nothing, at a distance of only a hundred and sixty 
 miles, when the communication is by means of the ordinary wagon 
 road the cost of transportation being equal to the selling price. 
 By railroad, under ordinary circumstances, that cost is but $2.40 . 
 leaving to the farmer $22.35, as the amount of tax saved to him 
 by the construction of the road ; and if we now take the product 
 of an acre of land, as averaging a ton, the saving is equal to inte- 
 rest, at six per cent., on $370 an acre. Assuming the product 
 of an acre of wheat to be twenty bushels, the saving is equal to 
 the interest on $200 ; but, if we take the more bulky products 
 hay, potatoes, and turnips it will be found to amount to thrice 
 that sum. Hence it is, that an acre of land, near London, sells 
 for thousands of dollars, while one of exactly equal quality may 
 be purchased in Iowa, or Wisconsin, for little more than a single 
 dollar. The owner of the first enjoys the vast advantage of the 
 endless motion of its products taking from it several crops in 
 the year, and returning to it, at once, a quantity of manure equal 
 to all he had abstracted ; and thus improving his land from year 
 to year. He is making a machine ; whereas, his western compe- 
 titor, forced to lose the manure, is destroying one. Having no 
 transportation to pay, the former can raise those things of which 
 the earth yields largely as potatoes, carrots, or turnips; or 
 those whose delicate character forbids that they should be carried 
 to distant markets ; and thus does he obtain a large reward for 
 that continuous application of his faculties, and of his land, which 
 results from the power of combination with his fellow-men. 
 
 In the case of the latter, all is widely different. Having heavy 
 transportation to pay, he cannot raise potatoes, turnips, or hay, 
 because of them, the earth yields by tons ; as a consequence of 
 which, they would be almost, even when not wholly, absorbed on 
 the road to market. He may raise wheat, of which the earth 
 yields by bushels ; or cotton, of which it yields by pounds ; but if 
 he raise even Indian corn, he must manufacture it into pork, before 
 the cost of transportation can be so far diminished, as to enable 
 him to obtain a proper reward for labor. Rotation of crops being, 
 therefore, a thing unknown to him, there can be no continuity of 
 action, in either himself or his land. His corn occupies the latter 
 but a part of the year, while the necessity for renovating the soil, 
 by means of fallows, causes a large portion of his farm to remain 
 altogether idle although the cost of maintaining roads and fences 
 is precisely the same, as if every acre were fully occupied. 
 
 His time, too, being required only for certain portions of the 
 year, much of it is altogether lost as is that of his wagon and 
 horses the consumption of which latter is just as great as if they 
 were always at work. He, and they, are in the condition of 
 steam-engines, constantly fed with fuel, while the engineer as
 
 PRESIDENT OF THE UNITED STATES. 101 
 
 regularly wastes the steam that is produced a proceeding in- 
 volving heavy loss of capital. Further stoppages of employment 
 both for his land and for himself resulting from changes in 
 the weather, are consequent upon this limitation in the variety of 
 things that may be cultivated. His crop, perhaps, requires rain 
 that does not come, and his corn, or cotton, perishes of drought. 
 Once grown, it requires light and heat, but in their place come 
 clouds and rain ; and it and he are nearly ruined. The farmer 
 near London, or Paris, is in the condition of an underwriter, who 
 has a thousand risks, some of which are maturing every day ; 
 whereas, the distant one is in that of a man who has risked his 
 whole fortune, on a single ship. Having made the voyage, she 
 arrives at the entrance of her destined port, when, striking on a 
 rock, she is lost, and her owner is ruined. Precisely such is the 
 condition of the farmer who having his all at risk on his single 
 crop sees it destroyed by blight, or mildew, almost at the mo- 
 ment when he had expected to make his harvest. With isolated 
 men, all pursuits are extra-hazardous ; but as they are enabled 
 to approach each other, and combine their efforts, the risks dimin- 
 ish, until they almost altogether disappear. Combination of ac- 
 tion thus makes of society, a general insurance office, by help of 
 which, each and all of its members are enabled to secure them- 
 selves, against almost every imaginable risk. 
 
 Great, however, Mr. President, as- are these differences, they 
 sink almost into insignificance, compared with that which exists, 
 in reference to the maintenance of the powers of the land. The 
 farmer distant from market is always selling the soil, which con- 
 stitutes his capital ; whereas, the one near London, not only re- 
 turns to his land, the refuse of its products, but adds thereto, the 
 manure resulting from the consumption of the vast amount of 
 wheat brought from Russia and America of cotton brought 
 from Carolina and India of sugar, coffee, rice, and other com- 
 modities, yielded by the tropics of lumber and of wool, the pro- 
 ducts of Canada and Australia not only maintaining the powers 
 of his land, but increasing them from year to year. 
 
 The more perfect the power of combination, the greater is the 
 yield of the land ; the higher are the prices of the rude products 
 of the soil ; the smaller is the bulk of the commodities to be trans- 
 ported ; and the larger are the proportions borne by their value 
 to the machinery required for their transportation. That, Mr. 
 President, is the road towards civilization, but it is, also, the very 
 opposite of the road that we ourselves are travelling the quan- 
 tity of machinery required for the work of transportation, increas- 
 ing with a rapidity far greater than that which marks the growth 
 of values. This latter being the certain road towards barbarism, 
 we need look but little further for the causes of the decline in 
 morals, wealth, and power, now so rapidly in progress throughout 
 the Union.
 
 102 LETTERS TO THE 
 
 The power to command the use of improved machinery, grows 
 with the growth in value of the things requiring to be transported 
 
 the farmer whose proximity to the mill enables him to send his 
 
 grain to market in the form of flour, being far more able to con- 
 tribute to the improvement of roads, than his fellow-farmer who 
 is forced to send it in that of wheat. It diminishes as the things 
 to be transported decline in value, and hence the weakness of 
 countries like Portugal, Turkey, and India, that are becoming 
 more and more dependent on distant markets. It diminishes 
 with us, and hence it is that our dependence on foreign 
 countries, even for efficient means of transportation, so rapidly 
 increases. 
 
 More than twenty years have now elapsed, since the arrival of 
 the Great Western steamer, and the establishment of the fact, that 
 we could avail ourselves of the power of steam, for the passage 
 of the broad Atlantic. For nearly all that time, we have been 
 struggling to obtain steam communication, by means of American 
 ships, with Europe the government aiding in the effort, to the 
 extent of many millions. What, however, has been the result of 
 all our efforts ? Ship after ship has been lost, until confidence in 
 American steamers has almost disappeared, and with it, the lines 
 of steamers. The Collins line, as it still is called, now dispatches 
 a single ship per month, and that, too, chiefly owned in Europe. 
 The Havre line dispatches a monthly ship. The Bremen line has 
 wholly disappeared. Mr. Yanderbilt has yet three ships engaged 
 in the European trade, but the recent accident to one of them can 
 scarcely fail to be felt injuriously by all annihilating the little 
 confidence that previously had existed. The day is fast approach- 
 ing, Mr. President, when no single steamer carrying the American 
 flag, will float upon the ocean, except government ships, and the 
 very few private ones engaged in the coasting trade, in which 
 foreign competition is wholly interdicted. Such being the facts, 
 and such the prospects, is it probable, that we shall long main- 
 tain that superiority on the ocean, which so certainly existed at 
 the time when the general government entered upon the career 
 of centralization ? It would seem not. Beaten in agriculture, 
 and beaten in manufactures, we are likely to be even yet more 
 thoroughly distanced in regard to ships ; and for the reason, that 
 our policy tends steadily towards lessening the value of the com- 
 modities seeking to be transported. 
 
 The French policy looking, as it does, to the emancipation 
 of land and labor from the tax of transportation is directly the 
 reverse of ours. We tax ourselves for the maintenance of millions 
 of tons of shipping, required for the transport of merchandise to 
 be given to France, in exchange for millions upon millions of tons 
 of food and other commodities, so reduced in bulk, that their 
 weight, in tons, is counted by thousands. JFreed, by that reduc-
 
 PRESIDENT OF THE UNITED STATES. 103 
 
 tion, from all the cost of transportation, France is enabled to in- 
 voke the aid of steam, and to such extent, too, that the arrivals 
 of her own steamers, in her own ports, amounted, in 1856, to no 
 less than 8,000 tons per week; and more than four hundred thou- 
 sand, in the year. 
 
 France, Mr. President, is carrying out your own most excel- 
 lent views in regard to commercial policy laying a broad foun- 
 dation of domestic commerce, as a means of obtaining the largest 
 power of intercourse with the outer world. We, on the contrary, 
 are destroying the domestic commerce, in the vain hope of thereby 
 building up a great foreign one. Why have we no steamers run- 
 ning to Rio, to Buenos Ayres, to Montevideo, to Valparaiso, to 
 Lima, or Australia ? Because we have little to sell, except those 
 rude products of the earth, which the people of Brazil, or Chili, do 
 not need to buy. Before they can do so, those commodities must 
 pass through the looms of Manchester and Lyons, and hence it 
 is, that nearly all our intercourse with the world is burthened 
 with costs of transportation so enormous, that our farmers are 
 generally poor, although themselves the owners of the land. In 
 search of trade, we fit out expeditions against Japan involve 
 ourselves in disputes with Paraguay and Buenos Ayres explore 
 African and South American rivers and maintain an enormous 
 diplomatic establishment throughout this continent; and yet, have 
 scarcely any thing to sell, except to the people of France and 
 England. 
 
 What we need, Mr. President, is that real free trade, which 
 consists in maintaining direct intercourse with the world at large ; 
 but that we cannot have, so long as we shall continue to export 
 our commodities in their rudest state. The farmer who has but 
 one mill at which to grind his grain, has no freedom of trade. 
 The miller and the baker have it they being free to sell to whom 
 they please. Our farmers and planters have none of it being 
 compelled to send their products to the distant mills, before they 
 and their neighbors can make exchanges, even among themselves. 
 They need, as you so well have seen, that real free trade which 
 would enable the planter of Mississippi to exchange with the 
 farmer of Illinois receiving cloth, lead, and iron, in exchange 
 for sugar and cotton. "That," as you have said, "is the free 
 trade we want." That we may have it, we must diversify the 
 employments of our people ; .we must enable them to combine 
 their efforts; we must relieve our farmers from a tax of trans- 
 portation, greater than is required for maintaining, ten times 
 over, all the armies of Europe ; we must enable ourselves to 
 pay our debts to the land, and thus obtain a real agriculture, in 
 place of the system of spoliation that now exists ; we must 
 establish a balance of trade in our favor, payable in the precious 
 metals, and thus enable ourselves to maintain the real specie cur-
 
 104 LETTERS TO THE 
 
 rency, that you so much desire to see established. Those things 
 done, we shall be able to command the use of machinery of 
 exchange of the highest order fleets of steamers taking the place 
 of sailing ships, and the use of money becoming obtainable, with- 
 out the payment of a higher interest than is paid in any other 
 country of the world, claiming to be held as civilized. Such, 
 Mr. President, is the real road to wealth and power ; but, as you 
 have seen, all our movements are in the reverse direction. 
 Yours, very respectfully, 
 
 HENRY C. CAREY. 
 Philadelphia, February $th, 1858.
 
 PRESIDENT OF THE UNITED STATES. 105 
 
 LETTER NINETEENTH. 
 
 "NOTHING," says Hume, " is esteemed a more certain sign of 
 the flourishing condition of any nation, than the lowness of inte- 
 rest" or, in other words, the moderation of the charge for the 
 use of that greatest of all the instruments used by man, called 
 money. It is, Mr. President, an evidence of the existence of that 
 feeling of security, which always attends advance of civilization 
 the rate of interest being very high in all countries in which pro- 
 perty is insecure, and declining steadily as we pass outward, to- 
 wards those in which men are more and more enabled to combine 
 their efforts for the promotion of the common good in which 
 population and wealth increase in which the land becomes more 
 productive in which the prices of raw materials tend to rise, and 
 those of finished commodities to fall and in which, consequently, 
 the power to purchase the precious metals augments from year to 
 year. 
 
 That power, and the tendency to decline in the rate of interest, 
 exist in every community, in the precise ratio of the activity of the 
 circulation of labor and its products. The more perfect the ex- 
 isting supply of money, and the more it is utilized, the more rapid 
 is the circulation, and the greater the tendency to increase in the 
 ability for further purchases. The less the supply, and the less it 
 is utilized, the slower is the societary circulation, and the greater 
 is the tendency to lose the money that had before been purchased. 
 In the one case, labor obtains power over capital, and the rate of 
 interest falls. In the other capital obtaining increased control 
 over labor the rate of interest rises. The first of these classes 
 of phenomena obtains in all those countries, that follow in the lead 
 of France importing raw materials, and exporting the products 
 of their soil in the most perfect form. The second is found in all 
 of those, that follow in the direction now indicated by England 
 exporting the rude products of the soil, and re-importing them 
 again in a finished state ; as is the case with Ireland, India, Ja- 
 maica, Portugal, Turkey, Mexico, and all the States of Southern 
 America. 
 
 In further proof of this, we may take the various phenomena 
 presented by ourselves, as our policy has changed from time 
 to time, within the last half century. In the period of free 
 trade that followed the close of the great European war, circula- 
 tion almost ceased labor was everywhere wasted production 
 was small and money was scarce and high. In that which fol- 
 lowed the passage of the highly protective act of 1828, everything 
 was different the circulation having then been rapid, labor in 
 demand, production great, and money low in price. The scene
 
 106 LETTERS TO THE 
 
 being once more changed, production declined, while money rose 
 with great rapidity becoming, at length, so entirely unattain- 
 able, that banks suspended, States defaulted, and the Federal 
 government was wholly bankrupt. The protective policy being 
 again adopted, production increased with great rapidity, while 
 the rate of interest fell. It has now been high for years, and for 
 the reason, that production has been steadily and regularly de- 
 clining in its ratio to the population. In proof of this, we have, 
 Mr. President, the fact, that the consumption of food, cloth, 
 and iron, bears now a smaller proportion to the numbers of the 
 people, than it did ten years since. The facts of the past three 
 years thus correspond, exactly, with those observed in those 
 that followed 1836. Interest was then high foreign loans were 
 large and emigration to the West was great. Speculation was 
 then rife, as it so recently has been ; but daily diminution of pro- 
 duction laid the foundation of the distress and ruin, that became 
 so universal in 1842. 
 
 That real prosperity is totally inconsistent with an advancing 
 rate of interest, is a fact whose truth is proved by every chapter 
 in the world's history. In that direction, lie centralization and 
 slavery increase in the charge for the use of money being evi- 
 dence of growth in the power of the accumulations of the past, 
 over the labor of the present of capital over labor. In proof 
 of this, we have the fact, that throughout an important portion 
 of the Union, the pro-slavery feeling keeps steady pace with the 
 exhaustion of the land, consequent upon the export of its products 
 in their rudest shapes with the export of the precious metals 
 and with the increase in the price of money. 
 
 Money is often spoken of as capital ; and thus we are told, 
 that interest is high, because " capital is scarce." There would, 
 however, be as much propriety in saying, that rents, tolls, or 
 freights, were high, because capital was scarce. Interest is always 
 high, when money, from whatsoever cause, is scarce ; and the high 
 price then paid for its use, causes a deduction from the profits of 
 the trader, from the. rents of houses, and from the freights of 
 ships. The owner of money then profits at the expense of all 
 other capitalists. Interest is the compensation paid for the use 
 of the instrument called money, and for that alone. In countries 
 in which it is high, the rate of profit is necessarily so, because 
 the charge for the use of money enters so largely into the trader's 
 calculations. 
 
 The high profits of our Western States are said to be the cause 
 of the high interest that is paid ; but here, as everywhere, modern 
 political economy substitutes effect for cause. Interest there is 
 high, because money the thing for which, alone, interest is paid 
 is scarce ; and because its scarcity enables the men who can com- 
 mand the use of machinery of exchange, to obtain large profits, 
 by means of standing between the producer who needs advances
 
 PRESIDENT OF THE UNITED STATES. 107 
 
 on his corn, and the consumer who requires credit on his cloth 
 and iron. Wherever it is scarce, circulation is sluggish ; the 
 waste of the physical and mental power is great ; and the man 
 who can then command the use of that indispensable machinery, 
 becomes even more the master of him who desires to use it, than 
 the transporter does, when crops are large, and ships are scarce. 
 
 Daily experience, Mr. President, teaches the farmer, that when 
 money the machine by means of which exchanges are made 
 from hand to hand circulates freely, he becomes more prosper- 
 ous from day to day ; whereas, when it is scarce, and circulates 
 slowly, his prosperity disappears. It is not capital that is needed, 
 but money the machine by help of which the products of labor 
 and capital are kept in motion, and without which they can move 
 only in the fashion of primitive times, when skins were traded for 
 knives and cloth. Our actual capital, hhouses, lands, factories, 
 furnaces, mines, ships, roads, canals, and other similar property, 
 has, in the last ten years, been increased by the application of 
 labor to the extent of thousands of millions of dollars ; , and yet, 
 we everywhere see roads half finished, and unlikely soon to be 
 completed, although laborers are seeking employment ; mills 
 stopped for want of demand for their products ; laborers unable 
 to sell their labor ; and men of business compelled to curtail their 
 operations, because of the difficulty experienced, in obtaining the 
 means with which to pay their debts. Why is this so ? Not, 
 certainly, because of any diminution of capital, for that is greater 
 than it has ever been. 
 
 Were it possible now to announce, that, by reason of any change 
 of policy, the export of gold would be stopped, and that the quan- 
 tity in the country would steadily be increased, by retaining here the 
 produce of California, money would forthwith become abundant and 
 cheap circulation would recommence and prosperity would reign 
 throughout the land ; and yet, the difference in the ensuing year, 
 would not amount to a quarter of one per cent, of the value of 
 the land and labor of the country. Capital would be increased 
 by a portion so minute as scarcely to be discernible, and yet the 
 money value the value at which it would be exchanged would 
 be augmented by thousands of millions. At present, all is stag- 
 nant, and there is little force. Then all becoming life and mo- 
 tion the force exerted would be great. 
 
 It is not, however, Mr. President, in the quantity of money 
 held by a community, that we are to find the test of its prosperity, 
 or the index to the rate of interest ; but in the rapidity with which 
 it circulates. Steadiness and regularity in the motion of society 
 are requisite for the production of confidence, and increase of mo- 
 tion and force results from confidence. The gold held by the 
 banks, the people, and the government, is said to exceed by more 
 than $150,000,000 what was held but a few years since; but 
 there being no regularity in the societary movement credit is
 
 108 LETTERS TO THE 
 
 ranch impaired. As a consequence of this it is, that the circula- 
 tion is sluggish, and that the rate of interest has, for years, been 
 so very high, as greatly to limit the disposition to engage in any 
 operations requiring time for their completion. The moneyed 
 capitalist profits by this obtaining treble or quadruple the usual 
 rate of interest ; but the miner, the founder, the cotton-spinner, 
 and the cloth-maker, have been, and are being, ruined by it. 
 
 The existence of credit is an evidence of the existence of that 
 confidence of man in his fellow-man, which always attends the 
 growth of real civilization. How it tends to stimulate the socie- 
 tary motion, and thus to augment the productive power, is so well 
 exhibited by a recent French economist, that I am induced, Mr. 
 President, to present for your consideration, the following extract 
 from his work : 
 
 "On one side," say M. Coquelin, "we see a machinist, a 
 blacksmith, and a wheelwright, whose shops are closed, not per- 
 haps because of any want of raw materials, but because of absence 
 of demand for their products. Elsewhere, are manufacturers in 
 want of machinery, and farmers in need of agricultural implements. 
 Why, now, is it that these latter do not give to the former, the 
 orders for want of which they continue idle ? Because these latter 
 must be paid in money, which money the others cannot at the 
 moment pay ; and yet they have, in shops or barns, abundance 
 of commodities that they desire to sell, and by the possession of 
 which many of the neighboring people would be greatly served. 
 Why do they not exchange? Because direct exchange being 
 impossible they must commence by selling ; and, as they, in 
 their-turn, must demand money, they can find no purchasers. 
 Here we have a suspension of labor on both sides, and it is in 
 cases like this, that production is languid and society vegetates, 
 although surrounded by all the elements of life, motion, and 
 prosperity. 
 
 "Means might, however, be found for removing the difficulty 
 that thus exists. If the machinist, the blacksmith, and the wheel- 
 wright, refuse to deliver their products, except for ready money, 
 it is not because of any doubt they entertain of the future solvency 
 of the farmer, or the manufacturer ; but because it is inconvenient 
 to them to make credit sales that would diminish their active 
 capital, and perhaps disable them from continuing their opera- 
 tions. Let each one, then, in delivering his articles, as he has 
 confidence in the future ability of those who now demand them, 
 require only, in place of money, a note that, in his turn, he can 
 use, with those who furnish him. On this condition, circulation 
 will be re-established, and labor will be resumed. True, but we 
 must first be sure that these notes, when accepted, will be received 
 elsewhere, as, otherwise, it becomes at once a simple sale on credit. 
 This certainty, however, cannot be obtained, and therefore they 
 refuse the notes ; not because of any suspicion of their ultimate
 
 PRESIDENT OF THE UNITED STATES. 109 
 
 value, but because of doubts of the possibility of disposing of 
 them. At this moment a bank intervenes, and says : 'You, 
 machinist, deliver your machinery ; you, blacksmith, your instru- 
 ments ; you, ploughman, your raw materials ; you, manufacturer, 
 your manufactures : accept, with confidence, notes payable at a 
 future time, provided you have full belief in the goodness of 
 those who will thus become your debtors. I will take charge of 
 all those notes, and hold them until they shall become due giv- 
 ing you in exchange other notes, issued by me, that you will be 
 certain to find of universal acceptation.' Forthwith, all difficulty 
 is at an end sales being made, goods circulating, and produc- 
 tion becoming animated. There are no longer raw materials, in- 
 struments, nor products of any description, remaining, even for a 
 moment, unemployed." 
 
 There is, here, Mr. President, no change in the quantity of capital 
 owned by the community, and yet, its members are seen passing 
 from a state of apathy and idleness to one of activity and produc- 
 tiveness enabling every one to sell his labor receiving in ex- 
 change the commodities required for the consumption of wives and 
 families, who before were like to suffer for want of the common 
 necessaries of life. What, however, is it that gives value to these 
 notes, and why is it that they circulate so much more freely than 
 those of the blacksmith and the farmer ? Because there exists in 
 the community, a confidence that behind them stands a pile of 
 money sufficient to redeem each and every one of them, when- 
 ever, and however, presented. Without the existence of that be- 
 lief, they would not circulate, as would soon be seen, were there 
 established a drain of gold producing a steady diminution of 
 the quantity in the possession of the bank, until at length even a 
 single note failed to be paid on presentation. From that moment 
 their circulation would be stopped ; the suspension of movement 
 would again take place the blacksmith, the machinist, and the 
 wheelwright, again mourning over instruments that they would 
 gladly exchange for food and cloth ; and the farmer and the manu- 
 facturer suffering from the difficulty of obtaining machinery, for the 
 better production of food and clothing. Money is to society what 
 fuel is to the locomotive, and food to the man the cause of 
 motion, whence results power. Withdraw the fuel, and the ele- 
 ments of which water is composed cease to move, and the machine 
 becomes stationary. Withdrawal of the food from man, is followed 
 by paralysis and death ; and such, precisely, is the effect of failure 
 of the necessary supply of money the producer of motion, among 
 the elements of which society is composed. 
 
 When, therefore, the farmer complains that money is scarce, 
 and the laborer, mechanic, and manufacturer, repeat the complaint, 
 they are right. It is money that is needed, and their common 
 sense does not in any manner deceive them. In every country of 
 the world, pleasant feelings are excited by hearing of the incom-
 
 110 LETTERS TO THE 
 
 ing of gold and silver, because therewith are associated ideas 
 of activity and energy ; while, on the contrary, fear and sorrow 
 are excited by their outgoing there being therewith associated 
 ideas of dnlness, inactivity, suffering, and death. The former, 
 Mr. President, have been the feelings prevalent throughout this 
 country in the closing years of the several trials we have made of 
 the protective policy to wit, in 1816, 1834, and 1846 the 
 precious metals having then flowed in, confidence having been 
 mutual, and money having been readily obtainable at the legal 
 rate of interest. The latter feelings have prevailed in the closing 
 years of every trial of the free-trade system those metals having 
 then flowed out confidence having disappeared and the charge 
 for the use of money having ranged from 12 to 50 per cent. 
 
 The cause of all the differences then observed, is to be found 
 in the fact, that in the first, the policy of the central government 
 has tended to promote the growth of combination among our peo- 
 ple to increase the facilities of exchange and to augment pro- 
 duction ; whereas, in the other, it has tended to destroy the power 
 of association to lessen the facilities of intercourse and to 
 diminish the productive power. In the one, we have been enabled 
 to obtain improved machinery passing from the turnpike to the 
 railroad from the sailing ship to the steamer from the hand- 
 loom to the power-loom and from irredeemable paper-money to 
 a real specie circulation. In the other, our machinery has steadily 
 deteriorated railroads going to ruin steamers diminishing in 
 number the spindle and the loom giving place to the wagon 
 and specie disappearing, to be replaced by the inconvertible notes 
 of cities, counties, and banks, and of the national treasury itself. 
 
 Diminution in the rate of interest, Mr. President, is an evidence 
 of advancing civilization. With us, the rate increases, and there- 
 fore it is, that each successive year brings with it new combinations 
 for procuring a repeal of the laws limiting the rate at which 
 money may be lent. The cause of all this, is to be found in the 
 fact, that the policy of the central government looks steadily to- 
 wards an increase in the power of the trader, and in the tax of 
 transportation augmenting, as it does, the quantity of shipping 
 required for transporting any given value of our products, and 
 thus diminishing the power to purchase that highest and best of 
 all the machinery of exchange, called money. Under a different 
 system, that power would steadily increase, and usury laws would 
 gradually die out the standard rate of interest falling below the 
 legal one. All the efforts for the repeal of those laws, are to be 
 regarded only as furnishing additional evidence of the growing 
 power of capital over labor always a characteristic of declining 
 civilization. 
 
 Our present position, Mr. President, is precisely similar to that 
 described in the above extract from M. Goquelin's excellent little 
 book. With a large supply of lands, houses, corn, cotton, and
 
 PRESIDENT OF THE UNITED STATES. Ill 
 
 other commodities and things, we have little commerce among 
 ourselves. Corn abounds, but the laborer perishes for want of 
 food. Houses abound, but wives and children wander through 
 our streets for want of shelter. Ships abound, but their owners are 
 mined for want of freights. Coal abounds, and yet men, women, 
 and children perish of cpld. Commerce, so far as regards the 
 sale of labor, has almost ceased to exist. Why is it so ? Because 
 money has ceased to circulate, and in the absence of that circula- 
 tion, the societary movement, called commerce, can have no exist- 
 ence. Why has it ceased to circulate ? Because confidence has 
 wholly disappeared. Why has it disappeared ? Let us inquire. 
 
 History, as we are told, is philosophy teaching by example. 
 What, then, does history tell us ? When has confidence most 
 prevailed ? Has it not been in the closing years of the three pro- 
 tective periods those periods in which there was an inward flow 
 of the precious metals ? When has it most entirely disappeared ? 
 Has it not been in the closing years of the three free-trade periods 
 those periods in which gold and silver flowed outwards? 
 When has the price of money been most regular ? Has it not 
 been in the protective periods ? When has it been most irregular ? 
 Has it not been in the free-trade ones ? When have we become 
 rich and strong ? Has it not been in the protective periods ? 
 When have we become gradually poorer and weaker ending 
 with general bankruptcy ? Has it not been in the free-trade pe- 
 riods ? When has labor acquired power over capital ? Has it 
 not been in the protective periods ? When has capital acquired 
 power over labor ? Has it not been in the free-trade periods ? 
 To these questions, the answer must be in the affirmative our 
 tendency in the one having, always, been towards localization and 
 freedom, and in the other, as regularly, towards centralization and 
 slavery. 
 
 Such, Mr. President, having been the law of the past, what is 
 to be that of the future? If protection has given us wealth, 
 strength, credit, and power, in the past, must it not do the 
 same in the future ? If the system called free trade has given us 
 poverty, distrust, and weakness, in the past, can it do otherwise in 
 the future ? Assuredly not, and for the reason, that it looks to 
 the exhaustion of the soil, the impoverishment of the farmer, the 
 increase of the power of the trader in goods and money, the 
 annihilation of the power to obtain the machinery required for 
 reducing the labors of production, and the destruction of confi- 
 dence of man in his fellow-men. So long as that system shall 
 be continued, there can be no general revival of confidence, be- 
 cause property must, and will, become less and less secure. That 
 it may be revived, it is needed that the central government change 
 its system abandoning at once, and for ever, the idea of main- 
 taining a hard money currency while pursuing a policy tending to 
 the expulsion of the precious metals, and, that of building up a
 
 112 LETTERS TO THE 
 
 great foreign commerce, by aid of measures tending to destroy 
 the domestic one. 
 
 That further progress, in its present direction, must be produc- 
 tive of effects the most disastrous, will be obvious to you, Mr. 
 President, on a careful study of the facts presented for considera- 
 tion by the last few years. With a larger supply of the precious 
 metals than we ever before possessed, but without the smallest 
 confidence in the duration of the apparent prosperity, gold has 
 been secreted to such extent, that the price of money has been so 
 high as to have proved utterly destructive to the really working- 
 men of the community all their apparent profits having been 
 absorbed by the payment of usurious interest. Mills, factories, 
 mines, and furnaces, as a consequence, have been closed, to the 
 utter ruin of their owners. Workmen, of all descriptions, have 
 been obliged to seek in the West the food denied to them at home. 
 There arrived, they have found the public lands monopolized by 
 speculators, to whom they have been obliged to pay double, treble, 
 or quadruple prices, for the little land they needed. Thus plun- 
 dered at the outset of their operations, they have been compelled 
 to borrow money, paying for its use, at every rate from 20 to 70 
 per cent, a year. The bubble having burst, they find themselves 
 in the hands of their usurious creditors, and now the sheriff will 
 complete the work. 
 
 The whole policy of the central government tends, thus, to the 
 annihilation of the really useful portion of society, and to the ag- 
 grandizement of traders in money, in land, in cloth and cotton, in 
 principles, and in men ; and, as a necessary consequence, the de- 
 moralization of society becomes more complete with each succes- 
 sive year. The range of honest employment becoming daily more 
 and more restricted, men are driven, by sheer necessity, to engage 
 in schemes of public and private plunder, from which, under other 
 circumstances, they would shrink back, shuddering at their very 
 thought. How long, Mr. President, can such a state of things 
 endure ? Is it possible, under such a course of operation, to 
 build up a stable system ? That it is not, is proved by all the 
 facts of history. A change must come in the policy of the govern- 
 ment, or the government itself will undergo a change. 
 
 The commerce that you, Mr. President, have so well described, 
 as being the sort of free trade that we really need, is all that is 
 required to render money abundant and easily obtainable at a 
 moderate interest, with larger power to obtain mills, steamers, 
 money, and all other machinery, than is now possessed by any 
 other community of the world. Give the people but thai com- 
 merce, and confidence will be at once restored. 
 Yours, very respectfully, 
 
 HENRY C. CAREY. 
 
 Philadelphia, February 12th, 1858.
 
 PRESIDENT OF THE UNITED STATES. 113 
 
 LETTER TWENTIETH. 
 
 I 
 
 THAT the rate of interest, throughout the Union, is very high, 
 and that it constitutes a serious obstacle to the extension of manu- 
 factures, to the development of our vast treasures of coal, iron, 
 and other metals, and to the creation of a domestic market for 
 the produce of the soil, are facts, Mr. President, that cannot be 
 denied. We are, however, assured, that their existence is conse- 
 quent upon the deficiency of a certain something, called capital 
 that time, alone, is required for obtaining the necessary supply 
 and that, then, money will be cheap, and manufactures will be 
 established. What, however, has been the direction in which we 
 have moved, in the last few years ? Have we advanced, or retro- 
 graded ? Has the price of money fallen since 1846 ? Has it not, 
 on the contrary, greatly risen ? Is capital more easily obtainable, 
 for mining, or for manufactures, than it was, ten years since ? 
 Has not, on the contrary, the capital that then was so engaged, 
 almost entirely disappeared ? Are our farmers less dependent on 
 the distant market, than they were in 1846 ? Have they not, on 
 the contrary, become greatly more dependent? If, then, for the 
 last twelve years, our movement has been retrograde, is it pro- 
 bable, Mr. President, that further continuance in the line of 
 policy to which that effect is due, will change the movement to 
 a forward one ? Scarcely so, as it would seem. 
 
 Capital abounds, and the price paid for the use of the instru- 
 ment called money, is low, in all those communities, in which em- 
 ployments have been diversified ; those, in which the consumer 
 and the producer have taken their places by each other's side ; 
 those, in which the tax of transportation is small ; those, in which 
 agriculture is becoming a science ; those, in which the yield of 
 the land steadily increases ; those, whose raw materials steadily 
 rise in price ; those, consequently, whose growing wealth enables 
 them to increase their supplies of the precious metals, as is the 
 case with the countries of Central and Western Europe those 
 which follow in the lead of France. 
 
 Capital is scarce, and interest is high, in all those countries 
 which are dependent upon a nearly exclusive agriculture ; those 
 whose markets are distant ; those which are subject to heavy tax 
 for transportation; those whose agriculture consists in robbing 
 the earth, and selling the soil ; those, the yield of whose land de- 
 creases ; those, whose raw materials fall in price ; those, conse- 
 quently, whose poverty forbids increase in the supply of the pre- 
 cious metals, as is the case with Ireland, India, Portugal, Turkey, 
 and all other countries which follow in the lead of England.
 
 114 LETTERS TO THIi 
 
 Capital being scarce among these latter, they are constantly 
 assured that, under existing circumstances, it is absurd for them 
 to attempt to convert their corn and their wool into cloth, or their 
 coal and ore into iron. It is, however, manufactures that cause 
 the growth of capital facilitating, as they do, the development 
 of the powers of THE MAN, and thus enabling him to combine 
 with his fellow-men, for economizing the power resulting from the 
 consumption of capital in the form of food. 
 
 Every act of combined action, Mr. President, has for its object, 
 and its effect, a saving of human effort, which, itself, is capital. 
 Sometimes, a few individuals combine to drain a piece of land ; 
 at others, to dig a well, to construct a mill, or to open a mine ; 
 all of which require capital ; that is to say, the investment of a 
 certain amount of labor, upon the same principle, identically, 
 that the farmer ploughs his land, and sows his seed calculating 
 upon having it returned, with interest for its use. When Crusoe 
 made his rope-ladder, he did so for the reason, that it was better 
 for him at once to expend a few hours, or, in other words, a little 
 capital, than to waste, throughout the year, an hour a day, in 
 climbing the rock under which he had taken up his abode. All 
 the labor thus economized, was capital. 
 
 "What," says a recent French economist "What is the ob- 
 ject, what the result, sought to be obtained by every advance of 
 capital, for whatsoever purpose ? It is, everywhere and always, 
 that of suppressing, by means of a certain quantity of labor once 
 performed, a certain portion of current labor and annual ex- 
 pense that would otherwise re-appear periodically, and for an 
 indefinite period of time ; it is to exonerate, at the cost of a 
 momentary sacrifice, the whole future of production. 
 
 " Every intervention of capital has the effect of diminishing 
 daily labor, resulting from the constantly recurring difficulty of 
 an operation : thus, we have here a village situated at the dis- 
 tance of a mile from a river each of its people, when he has 
 occasion for water, being required to walk that distance. No 
 capital is expended, but there is a periodical demand for labor, 
 carried to its highest point. The inhabitants, at length, conceive 
 the idea of making some earthen vessels, having done which, they 
 go once a day returning with the day's supply of water. Capital 
 now making its appearance in the once-performed labor of making 
 the vessels, the daily expenditure of human effort is diminished, 
 in the proportion that the one walk to the river, bears to the five, 
 or six, that would, otherwise, have been required. 
 
 " Next, some one constructs a cask, and a wagon attaching to 
 the latter an ass, or an ox, and carrying water about the village. 
 Here is a new expenditure of capital, but, in return, there is eco- 
 nomy in the daily labor proved by the fact, that the people now 
 buy their water, in place of going to get it. At length, however, 
 .an aqueduct is built requiring an enormous expenditure of
 
 PRESIDENT OF THE UNITED STATES. 115 
 
 capital ; but the daily effort that had been needed for obtaining a 
 supply of water is from this time at an end capital having, so to 
 speak, altogether superseded labor. 
 
 "The proof that all these successive interventions of capital 
 have been economies of force, time, and money, is, that all these 
 expenditures have been' returned in the value of the water ob- 
 tained ; and that, while casks, wagons, and buildings, have been 
 paid for and maintained, the price of water has steadily fallen ;" 
 and, as the author might well have added, the consumption has 
 so much increased, that a single family now consumes more than 
 would, at first, have supplied the village. 
 
 In writing this passage, M. de Fontenay had no reference, what- 
 soever, to the question of protection of the claims of commerce 
 on the one side, or of those of trade on the other ; but, it is the 
 characteristic of propositions that are true, that they, at all times, 
 and everywhere, prove themselves true. The great object of man, 
 Mr. President, being that of acquiring power over nature, the 
 more he does so, the less is the value of the commodities he re- 
 quires, the greater is his own, and the larger becomes his con- 
 sumption. To attain power, there must be combination of effort. 
 The obstacle to association being found in the, necessity for trans- 
 portation, the more it can be removed, the greater is not only the 
 present power of man, but the greater his capacity for new and 
 more important efforts. The spring beingi distant, he calls to his 
 aid, in regular succession, various natural forces passing from 
 the mere hand to the jug, the cask, and the wagon, with constant 
 decline in the cost and value of water. When, however, he con- 
 structs an aqueduct, and is thus enabled to avail himself of the 
 power of gravitation, value ceases water becoming cheap as air. 
 
 The Indian path being bad, he determines, once for all, to 
 make a road, the effect of which is soon exhibited in the fact, 
 that he is enabled, once again for all, to make a turnpike ; and 
 yet, so much are his powers thereby augmented, that we find him 
 again, once for all, investing millions of present labor in construct- 
 ing a canal then regarded as the neplus ultra of improvement. 
 Here again, however, Mr. President, we find it to be only the 
 first step that costs the economy of labor effected by the canal 
 proving so great, that but a trivial portion is required for the 
 construction of a railroad, that transports himself and his mer- 
 chandise at a cost so small, as to treble the reward of labor. 
 
 The school-house being distant, his children are obliged either 
 to dispense altogether with education, or to waste most of their 
 time on the road thereto. Seeing himself surrounded by the ma- 
 terials of which houses are composed, he proposes to his neigh- 
 bors that they shall, once for all, give their labor to the construc- 
 tion of a house thereby enabling themselves to economize the 
 labor of placing their children on the spot at which they are to be
 
 116 LKTTERS TO THE 
 
 instructed ; and now instruction so much declines in cost, that 
 ten times as many children are enabled to profit by it. 
 
 The market being distant, he is obliged to incur, daily, the cost 
 of transferring his wool and his corn, to be exchanged for cloth. 
 Looking around, he sees that nature has furnished him with the 
 same forces, precisely, with those in use among the distant millers. 
 The fuel will give as much heat; and the ore will make iron of equal 
 strength. He therefore proposes to his neighbors, that they shall, 
 once for all, unite together for building a stack through which to 
 pass the ore and the coal, the laborers in which will eat the corn 
 that now they are obliged to carry to the distant market thus 
 terminating, at once and for ever, the necessity for so much trans- 
 portation. 
 
 , The iron now obtained, he next, Mr. President, suggests, that 
 steam can as well be made to spin and weave cotton in their own 
 neighborhood, as in any other ; that stone, lumber, and lime, are 
 abundant all that is required, for economizing the daily labor 
 of transportation, being, that they should, once for all, club to- 
 gether for putting up a house, and for bringing from abroad a 
 little machinery, and the skill required for working it. Further, 
 he says to them : " We are, ourselves, unemployed for more than 
 half our time, and, as regards our children, they are almost wholly 
 so. Though unfit for the labors of the field, they yet could well 
 perform the lighter work of tending the operations of a mill. 
 Again, the minds of our people are undeveloped. Let us have 
 them taught, and in a brief time obtaining machinists of our 
 own it may be. that we shall be enabled to teach those among 
 whom we now must seek for knowledge. We waste, daily, the 
 powers of earth and air, for want of little machines, that would 
 enable us to use them ; we waste the faculties of our people, be- 
 cause there is no demand for them ; we waste their time and our 
 own, for want of combination ; we waste the major part of the 
 products of our land in feeding the horses and men who carry the 
 rest to market exhausting the soil, because the market for its 
 products is so very distant. Let us, then, once for all, combine 
 for the purpose of putting a stop to all this waste. With every 
 step we make in that direction, we shall offer new inducements 
 for carpenters and masons, printers and teachers, to come among 
 us eating the food, that now we are forced to carry to the dis- 
 tant market ; with each, the faculties of our people will become 
 more and more developed enabling us more and more to perfect 
 the various processes by means of which to obtain command over 
 steam and other natural forces. With each, there will be an in- 
 crease of commerce among ourselves, attended by diminution of 
 our dependence on the trader, and an increase of power to com- 
 mand his services in case of need. The more numerous the 
 differences among ourselves, the more rapid will be the motion of 
 the societary machine, the greater will be the economy of labor,
 
 PRESIDENT OF THE UNITED STATES. 117 
 
 the smaller will be the value of commodities, and the greater that 
 of man.- 7 ' 
 
 Such, Mr. President, were the objects sought to be attained by 
 Colbert, to whom France was indebted for the system since so 
 steadily carried out ; that, to which she owes it, that she has 
 "covered herself with machinery and mills" that "her collieries, 
 her furnaces, and her workshops of every description, have grown 
 to an enormous extent, and out of all proportion to what existed 
 eighty years since " that the value of her land has so immensely 
 increased that the power of the laborer to command supplies 
 of food has doubled, where, even, it has not trebled and that 
 she herself is now so powerful. 
 
 Directly the reverse of this, is the doctrine lying at the founda- 
 tion of the system that would make of Britain the workshop of the 
 world ; that, for the maintenance of which, we are taught that 
 man begins everywhere with the richest soils all old communi- 
 ties being required to resort to poorer ones, with daily diminution 
 in the demand for labor. To our farmers and planters, and to 
 those of Brazil and Cuba, it says "Cultivate your rich soils, 
 and leave us to our poor ones. Labor being cheap with us, we 
 can manufacture more cheaply than you can do. Do not, there- 
 fore, once for all, build mills or furnaces ; continue year after 
 year to expend your labors in carrying produce back and forth ; 
 continue to exhaust your land ; continue to have no combination 
 of effort among yourselves ; and you will grow rich. The time, 
 however, will arrive, when you will be forced to cultivate the poor 
 soils, and then you will be troubled with over-population. Wages 
 falling, you may then be enabled to accumulate the capital required 
 for entering into competition with us ; that is to say, the poorer 
 you become, the greater will be your power." 
 
 Such, Mr. President, is the doctrine of the school that is based 
 upon the idea of trade being the first pursuit of man ; that, by 
 help of which the system has, thus far, been carried out. It is 
 one which cannot stand against the facts everywhere established, 
 that man always commences with the poorer soils ; that it is only 
 with the growth of the power of association and combination that 
 the richer ones are brought into activity ; that, to have combina- 
 tion, there must be differences of employment, tending to the de- 
 velopment of the individual faculties ; and that, where such differ- 
 ences are not found, the whole course of man is towards the ex- 
 haustion of the land first cultivated towards diminution in its 
 value, and increase in that of all the commodities required for 
 his use and towards his enslavement, both by nature and by his 
 fellow-man. Under that system it is, that Ireland wastes, weekly, 
 more labor than would, if applied once for all, give her the ma- 
 chinery required for enabling her to make a domestic market for 
 all her food, and all her labor ; that Portugal and Turkey waste, 
 daily, more muscular and intellectual power than would, if applied
 
 118 LETTERS TO THE 
 
 once for all, give them machinery for making all the cloth they 
 now consume ; that Jamaica has been exhausted ; and that the 
 people of India have been condemned to remain idle, when they 
 would desire to be employed ; to relinquish rich soils, and retire to 
 poor ones ; to abandon cities iu which once lived hundreds of 
 thousands of poor, but industrious and happy, men foregoing 
 all the advantages of commerce, and becoming dependent, alto- 
 gether, on the chances of trade. 
 
 Following in the lead of France, the people of Northern Eu- 
 rope, generally, have protected themselves against this system 
 the result being seen in the facts, that the prices of raw materials 
 and finished commodities are there steadily approximating ; that 
 gold flows rapidly in ; that the rate of interest is moderate ; that the 
 circulation of society becomes from day to day more rapid ; that 
 the proportion borne by fixed to floating capital is a constantly 
 increasing one ; and that the power of the trader and transporter 
 rapidly declines all of these phenomena being evidences of ad- 
 vancing civilization, consequent upon the determination, once for 
 all, to make the investments required for bringing the consumer 
 to the side of the producer, and thus relieving the former from 
 the wasting tax of transportation. 
 
 Guided, or governed, by England, Ireland, Turkey, Portugal, 
 and the United States, have refused to make the effort, once for 
 all, to relieve themselves from that oppressive and daily recurring 
 tax the result being seen in the facts, that the prices of raw ma- 
 terials and finished products steadily recede from each other; 
 that gold flows regularly abroad; that the rate of interest is 
 high ; that circulation becomes more languid ; that the proportion 
 borne by floating capital to that which is fixed is a constantly in- 
 creasing one ; and that the power of the trader and transporter 
 steadily increases all of these phenomena being evidences of de- 
 clining civilization. 
 
 Food, Mr. President, is capital. Having been consumed, it is 
 still capital, in the form of the power to labor, with the body, or 
 the mind, or both. That power being exerted, it re-appears in 
 the form of food or cloth books or newspapers. Not exerted, 
 it is altogether lost labor-power being, as you have seen, the 
 only commodity, that cannot be kept, even for a second. 
 
 The power to accumulate capital exists in the direct ratio of 
 the power of combination, and that itself exists in the ratio of the 
 diversity of employments. That understood, there can be little 
 difficulty in arriving at a proper understanding of the causes, why 
 it accumulates so rapidly in Central and Northern Europe, and 
 why it disappears so rapidly from Turkey and Portugal, Ireland 
 and India. 
 
 Careful study of these simple principles, Mr. President, will 
 enable us readily to understand why it has been, that capital has 
 always so much abounded, when we have had protection, and why
 
 PRESIDENT OF THE UNITED STATES. 119 
 
 it has so entirely disappeared, when we have had the system known 
 by the title of "free trade." The one looked to economizing 
 labor, which itself is, as you have seen, capital. The other looks 
 to wasting labor, or capital. Under the one, as in 1833 and 1846, 
 capital was readily obtainable, at moderate rates of interest, for 
 any useful purpose. Under the other, as in 1822 and 1842, and 
 as at the present time, it has become so scarce, as to be unattain- 
 able for the construction of roads, for the building of mills, or for 
 the opening of mines, at any rate of interest, however high. 
 
 Were the tariff of 1842 this day re-enacted into law, the face 
 of affairs throughout the country would be wholly changed 
 capital becoming at once abundant the rate of interest falling 
 and labor coming into demand to such extent, that men, women, 
 ami children, would find all the employment they could desire ; 
 and that, too, before the lapse of thirty days from the present 
 hour. Why, Mr. President, would it be productive of such re- 
 sults ? Because, there would at once arise, throughout the coun- 
 try, a confidence, that labor was again to be economized that 
 that internal intercourse which, as you, Mr. President, have seen, 
 we so greatly need, was to be obtained that the great domestic 
 market for food and labor was to be extended and that we were 
 again to become rich and strong enough to be enabled to purchase 
 full supplies of the precious metals, as was the case in the protec- 
 tive periods which closed in 1835 and 1847. 
 
 What we need is confidence in the future. Let that be ob- 
 tained, and capital will, from the instant, become as abundant as 
 we have ever known it. Give us that, and there will exist no 
 barrier to the maintenance of a specie circulation. Give us that, 
 and the occasion for extending the central powers at the expense 
 of the local ones, will pass away. Give us that, and our every 
 future step will be towards happiness, wealth, and power, and 
 towards domestic and foreign peace. Refuse that, and each suc- 
 cessive step will be attended by growing misery among the peo- 
 ple, and discord among the States. 
 
 The strength of every nation, as compared with other nations, 
 grows in the ratio of the growth of the power of combination 
 among the people of whom it is composed. That power grows 
 with the growing diversity of employments. With us, that diver- 
 sity diminishes, and hence the steady decline in the respect iu 
 which we are held, and in the power we exercise. 
 With great respect, 
 
 Your obed't servant, 
 
 HENRY C. CAREY. 
 
 Philadelphia, February 16th, 1858.
 
 120 LETTERS TO THE 
 
 LETTER TWENTY-FIRST. 
 
 How is it, that protection can be needed ? Why is it, that each 
 and every man is not to be free to use his products as he pleases 
 exchanging, equally freely, abroad and at home? How is it 
 possible, that our people have been, or can ever be, more pros- 
 perous under a protective system, than under what is called a 
 "free trade" one? These, Mr. President, are important ques- 
 tions seeking replies to which, we must now turn to some of the 
 pages of our Colonial history. 
 
 In one respect, the Colonial system of England has differed from 
 all others that have existed the moving principle of its founders, 
 as well as of all those who since have followed in its direction, 
 having been, that of prohibiting every attempt, on the part of the 
 colonists, at attaining that diversity of employments which is re- 
 quired for securing competition for the purchase of their own rude 
 products, or for the sale of finished commodities required in ex- 
 change and thus maintaining, at its highest point, the tax of 
 transportation. Without such diversity, the power of association 
 and combination could have no existence. Without it, the colo- 
 nists were bound to remain, for ever, mere instruments in the 
 hands of the traders and transporters of the mother-country. 
 That such were really the objects sought to be accomplished, is 
 shown in the following passage from the work of an influential 
 writer of the last century, to which I desire now, Mr. President, 
 to invite your attention : 
 
 " Manufactures in our American colonies should be discouraged, 
 prohibited." * * "We ought always to keep a watchful eye 
 over our colonies, to restrain them from setting up any of the 
 manufactures which are carried on in Great Britain ; and any 
 such attempts should be crushed in the beginning. " * * " Our 
 colonies are much in the same state as Ireland was in, when they 
 began the woollen manufactory, and as their numbers increase, 
 will fall upon manufactures for clothing themselves, if due care 
 be not taken to find employment for them, in raising such pro- 
 ductions as may enable them to furnish themselves with all the 
 necessaries from us." * * "As they will have the providing 
 rough materials to themselves, so shall we have the manufacturing 
 of them. If encouragement be given for raising hemp, flax, &c., 
 doubtless they will soon begin to manufacture, if not prevented. 
 Therefore, to stop the progress of any such manufacture, it is 
 proposed that no weaver have liberty to set up any looms, with- 
 out first registering at an office, kept for that purpose." * * 
 " That all slitting-mills, and engines for drawing wire or weaving 
 stockings, be put down." * * " That all negroes be jwohi-
 
 PRESIDENT OF THE UNITED STATES. 121 
 
 bited from weaving either linen or woollen, or spinning or 
 combing of wool, or working at any manufacture of iron, further 
 than making it into pig or bar iron. That they also be prohibited 
 from manufacturing hats, stockings, or leather of any kind. This 
 limitation will not abridge the planters of any liberty they now 
 enjoy on the contrary, it will then turn their industry to pro- 
 moting and raising those rough materials." * * " If we 
 examine into the circumstances of the inhabitants of our planta- 
 tions, and our own, it will appear that not one-fourth of their 
 product redounds to their own profit, for, out of all that comes 
 here, they only carry back clothing ana" other accommodations 
 for their families, all of which is of the merchandise and manu- 
 facture of this kingdom." * * "All these advantages we re- 
 ceive by the plantations, besides the mortgages on the planters' 
 estates and the high interest they pay us, which is very consider- 
 able.'" (GEE on Trade, London, 1750.) 
 
 Turning now, Mr. President, to the statute-book, you will find 
 a continued series of laws, each and every one of which had for 
 its object, that of carrying out the system above described pro- 
 hibitions of manufactures, on one hand, and bounties on the im- 
 port of raw materials, on the other, having been resorted to, for 
 preventing the colonists from making those changes in their 
 rude products, that were required for fitting them for consump- 
 tion among themselves. The one great object of the system, 
 was that of maintaining in its most bulky form, the commodity 
 requiring to be transported, while contracting, as far as 
 possible, the machinery by which the work of transportation 
 and conversion was to be effected thereby enriching the trader 
 and transporter at the cost of both consumer and producer. The 
 more perfectly it could be carried out, the greater would be the 
 difference between the prices of raw materials and finished com- 
 modities the greater would be the tendency towards exhaustion 
 of the soil and ruin of its cultivators the more would the people 
 become dispersed the heavier would become the tax of trans- 
 portation, and the more entirely would it be thrown upon the 
 colonists, who were thus to be impoverished, for the benefit of 
 those by whom the laws were made. 
 
 To the grinding taxation of a system which, thus, looked to the 
 establishment of a monopoly of the power to purchase the rude 
 products of the earth, and to sell the commodities into which they 
 became converted, and not to a paltry tax on tea, Mr. President, 
 are we indebted for the Declaration of our Independence, and the 
 war which followed it. To a desire for rendering that declaration 
 effective, by protecting our farmers and planters against the sys- 
 tem, was largely due the calling of the Convention which gave us 
 our Constitution a very brief experience having sufficed to satisfy 
 the various States, and Virginia most especially, that concert of 
 action for resistance to it, was essential to the advance of the
 
 122 LETTERS TO THE 
 
 Union in wealth aud power. To the knowledge of its action 
 acquired in, or derived from, colonial times, it was due, that each 
 and every of our Presidents, from Washington to Jackson, held, 
 that it was not only the right, but the duty, of Congress, so to 
 direct the power with which it was clothed, as to promote the 
 approximation of the producer and the consumer, aud thus to 
 diminish the enormous taxes of trade and transportation, by means 
 of which, the'farmers aud planters had been so much impoverished 
 to produce competition for the purchase of raw produce, and 
 for the sale of finished commodities, and thus secure to the agri- 
 cultural interest that freedom of commerce which is denied to him 
 who must make his exchanges at the single mill ; and in this 
 manner, to carry into practical effect, that independence whose 
 existence had been declared in 1776. 
 
 Such, Mr. President, were the general tendencies of the country, 
 during the half century which followed the peace of 1783 a pe- 
 riod remarkable beyond any other recorded in the history of 
 modern Europe, for commercial disturbance ; one, in which piracy 
 on the ocean sanctioned by French decrees and British Orders in 
 Council embargoes, non-intercourse acts, and wars with both 
 France and England, combined for the production of financial 
 derangement ; and yet, that one in our history which stands dis- 
 tinguished by the fact, that poor as we then were, our banks were 
 never, in time of peace, driven to suspension ; nor were either the 
 people, or the government, driven to the disgraceful necessity of 
 resorting to the use of irredeemable paper, as the only means of 
 maintaining the societary circulation. 
 
 Five-and-twenty years have since elapsed, and during nearly all 
 that period, the doctrines of our revolutionary fathers, as regarded 
 commercial policy, have been repudiated the essential duty of 
 the central government having been held to be, that of providing 
 for itself, careless of the effect of its measures upon the condition 
 of the people. So far as was required for their taxation, tariffs 
 might, as we have been assured, be tolerated ; but so far as re- 
 quired for their protection, they could not free trade, as it has 
 been called, having been the order of the day. 
 
 In what, however, Mr. President, does our present freedom of 
 trade consist? Is the planter free to exchange his cotton, abroad 
 or at home, at his pleasure ? Is there that growing competition 
 for his products, which tends to raise their prices ? That, there 
 certainly is not nearly all our mills being closed, aud he being 
 reduced to dependence on distant markets, such as he has not 
 known since the disastrous times of 1842. Are our farmers free 
 to exchange their food, abroad or at home, for iron with which 
 to make their roads ? Is there a growing competition for the 
 purchase of food, and the sale of iron ? Certainly not our fur- 
 naces and rolling-mills being closed the men who wrought in 
 them, turned adrift and the necessity for going to the distant
 
 PRESIDENT OF THE UNITED STATES. 123 
 
 markets with wheat and corn, being greater now, than it has been 
 since 1842. Are our workingmen free to sell their labor when 
 and where they please ? Do they find increase of competition for 
 the purchase of the single commodity they have to sell ? Assuredly 
 not there being ten who have labor for sale, to every one who 
 is seeking to purchase it. Look where you may, Mr. President, 
 you will find a diminution of competition for the purchase of labor 
 and the rude products of the land, the commodities we have to 
 sell the laborer, the farmer, and the planter, becoming, from 
 hour to hour, more and more, mere instruments to be used by the 
 trader and transporter ; and, for the simple reason, that it has been 
 held by your recent predecessors in the Presidential chair, that the 
 central government had only itself, and not the people, to protect. 
 Widely different from this, Mr. President, were the ideas of Wash- 
 ington and Hamilton, Adams and Jefferson, as to the rights and 
 duties of that government. 
 
 Freedom of commerce among ourselves the commerce between 
 our towns, cities, and States, which, as you have so ably shown, 
 is the sort of free trade we need has no existence. The farmers 
 of Illinois exchange between themselves, by means of the furnaces 
 of Wales and Scotland. The Iowa farmer can make no exchange 
 with the Mississippi planter, until after the corn and cotton have 
 travelled to Manchester, there to be converted into cloth to be 
 returned to Iowa and Mississippi eighty-five per cent, of the 
 corn and cotton being taken on the road, for the support of the 
 people by whom the exchanges are effected. Why this is so 
 why our farmers and planters are thus subjected to a tax of trans- 
 portation, compared with which, that of France and Germany is 
 as nothing you will, Mr. President, readily understand, after hav- 
 ing read the following passage, extracted from a document pub- 
 lished but four years since, by order of the British House of Com- 
 mons : 
 
 " The laboring classes generally, in the manufacturing districts 
 of this country, and especially in the iron and coal districts, are 
 very little aware of the extent to which they are often indebted 
 for their being employed at all to the immense losses which their 
 employers voluntarily incur in bad times, in order to destroy 
 foreign competition, and to gain and keep possession of foreign 
 markets. Authentic instances are well known of employers hav- 
 ing in such times carried on their works at a loss amounting in 
 the aggregate to three or four hundred thousand pounds in the 
 course of three or four years. If the efforts of those who encou- 
 rage the combinations to restrict the amount of labor and to pro- 
 duce strikes were to be successful for any length of time, the great 
 accumulations of capital could no longer be made which enable a 
 few of the most wealthy capitalists to overwhelm all foreign 
 competition in times of great depression, and thus to clear the 
 way for the whole trade to step in when prices revive, and to
 
 124 LETTERS TO THE 
 
 carrj on a great business before foreign capital can again accu- 
 mulate to such an extent as to be able to establish a competition 
 iu prices with any chance of success. The large capitals of this 
 country are the great instruments of warfare against the com- 
 peting capital of foreign countries, and are the most essential 
 instruments now remaining by which our manufacturing supremacy 
 can be maintained; the other elements cheap labor, abundance 
 of raw materials, means of communication, and skilled labor 
 being rapidly in process of being equalized." 
 
 The system here described is very properly characterized as 
 "warfare;" and we may properly inquire for what purposes, and 
 against whom, it is waged. It is a war, as you see, Mr. President, 
 for cheapening all the commodities we have to sell, labor and raw 
 materials being precisely the objects sought to be accomplished 
 by the " Mercantile System," whose error was so well exposed in 
 the Wealth of Nations. It is a war for compelling the people of 
 other lands to confine themselves to agriculture for preventing 
 the diversification of employments in other countries for retard- 
 ing the development of intellect for palsying every movement, 
 elsewhere, looking to the utilization of the metallic treasures of the 
 earth for increasing the difficulty of obtaining iron for dimin- 
 ishing the demand for labor for doing all these things at home 
 and abroad and for thus subjecting the farmers and planters of 
 the world to the domination of the manufacturers of Britain. 
 
 To measures such as here described, was due the closing of all 
 the factories of India, followed by the exportation of cotton to 
 England, there to compete with the products of Carolina and Ala- 
 bama. The more perfectly the system can be carried out the 
 more the manufacture can be restricted to England the cheaper 
 must be raw materials ; but the greater must be the export of 
 cheap labor to Texas and to the Mauritius, there to raise more 
 cotton, sugar, and other rude products ; and thence to compete 
 with each other for the reduction of prices, and for the more com- 
 plete enslavement of the laborers of all those countries. 
 
 In the case of a war like this, what, Mr. President, does a 
 government owe to its people and itself? The answer to this 
 question is furnished by one of the most distinguished of your pre- 
 decessors, Mr. Madison, in the following words : 
 
 " Should it happen, as has been suspected, to be an object, 
 though not of a foreign government itself, of its great manufac- 
 turing capitalists, to strangle in the cradle the infant manufactures 
 of an extensive customer, or an anticipated rival, it would surely, 
 in such a case, be incumbent on the suffering party so far to make 
 an exception to the ' let-alone ' policy as to parry the evil by op- 
 posite regulations of its foreign commerce." 
 
 That such is the duty of a government, no one can seriously 
 doubt ; and yet, that duty has remained unperformed. Time 
 after time, for the last half century, have the iron, the cotton, and
 
 PRESIDENT OF THE UNITED STATES. 125 
 
 the woollen manufactures, been stricken down by means of mea- 
 sures such as here are indicated, without the slightest attempts at 
 interference on the part of the central government. Crisis has 
 succeeded crisis, and with each successive one, the necessity for 
 the export of raw materials has increased, with steady decline of 
 prices, and as steadily increasing necessity for the export of the 
 precious metals to discharge the balance of trade, thus forced 
 upon our people. Hence, Mr. President, the difficulty of main- 
 taining a stable currency. Hence the ruinous rate of interest. 
 Hence the disasters among our merchants and our banks. Hence 
 the decline in the character of our ships. Hence our inability to 
 compete with the world in the use of steam for ocean-navigation. 
 Hence the decline of morals ; and, hence the discord now prevail- 
 ing between the different sections of the Union. 
 
 Allow me now, Mr. President, to ask you to read, once more, 
 the extract with which this letter was commenced, and study care- 
 fully what were the objects sought to be accomplished by the dis- 
 tant masters by whom the provinces then wei'e ruled. Doing this, 
 you will see, that they were those of limiting the colonists to the 
 single pursuit of scratching the soil, and thus destroying competi- 
 tion for the purchase of their products. Turning, next, to the ac- 
 tion of the Federal government, you can scarcely fail to remark, 
 how identical with the views of the British traders of colonial 
 times, have been its acts. 
 
 There, be assured, lies all the difficulty, and not with the local 
 governments. Clothed with the power to protect our people, it 
 has failed in the performance of its duties leaving them exposed 
 to a warfare of the most destructive kind, and to a taxation for 
 the support of foreign governments and peoples, compared with 
 which, the amount that would be required for the support of the 
 largest fleets and armies, sinks into insignificance. As a conse- 
 quence of this, we are rapidly passing into a state of dependence 
 more complete than that which existed in 1776. Further proof 
 of this, I propose to furnish in another letter, remaining mean- 
 while, 
 
 Yours, very respectfully, 
 
 HENRY C. CAREY. 
 
 Philadelphia, February Wth, 1858.
 
 126 LETTERS TO THE 
 
 LETTER TWENTY-SECOND. 
 
 THE system described in my last letter, Mr. President, is, as you 
 have seen, a war upon the agricultural communities of the world, 
 for the reduction of the prices of their rude products. To what 
 extent, it has resulted in reducing the prices of our staples, you 
 have already seen, How it taxes the planters and farmers every- 
 where, I propose now to show, and with that view, will commence 
 by asking your attention to the following comparative view of the 
 exports from Great Britain at the close of the great European 
 war, and at the opening of the gold-trade of California : 
 
 1815. 1851. 
 
 Export of woollens 9,381,426 10,314,000 
 
 " cottons 20,620,000 30,078,000 
 
 silks 622,118 1,329,000 
 
 linens 1,777,663 5,048,000 
 
 And of other commodities 19,231,684 21,723,569 
 
 Total 51,632,791 68,492,569 
 
 Nearly the whole increase that had taken place, in the long 
 period of thirty-six years, was thus found in four branches of 
 manufacture, the materials of which were wholly drawn from 
 abroad, as is shown in the following statement of imports for 
 that year : 
 
 Wool 83,000,000 Ibs. 
 
 Cotton 700,000,000 " 
 
 Silk 5,020,000 " 
 
 Flax 135,000,000 
 
 Eggs 116,000,000 No. 
 
 Oxen, cows, calves, sheep, hogs, &c 300,000 " 
 
 Corn 8,147,675 qrs. 
 
 Flour 5,384,752 cwt. 
 
 Potatoes 635,000 " 
 
 Provisions 450,000 " 
 
 Butter 354,000 " 
 
 Cheese 338,000 " 
 
 Hams and lard 130,000 
 
 Rice 450,000 " 
 
 Spirits , 2,000,000 galls. 
 
 Before proceeding to examine the figures above presented, I 
 desire, Mr. President, to invite your attention to the idea, that 
 those who furnish the food, clothing, and lodging, do, in fact, 
 furnish the power. A locomotive engine is merely the instrument 
 by means of which, the force yielded by the consumption of fuel is 
 made to serve the purposes of man. So it is with men. Their
 
 PRESIDENT OF THE UNITED STATES. 127 
 
 daily power to labor results from their daily consumption of food ; 
 and therefore is it, that those who supply the food and clothing, 
 are really the parties who supply the power that is used. That 
 understood, we may now inquire how many of the people of Eng- 
 land are fed by the agricultural nations of the world, preparatory 
 to an inquiry into the number there employed, in doing their work. 
 Divided among four millions of persons, the articles of food 
 included in the above, would give to each about 
 
 1100 pounds of corn, 
 
 150 
 12 
 16 
 18 
 20 
 12 
 
 flour, 
 
 fresh meat, 
 
 salted " 
 
 potatoes, 
 
 butter and cheese 
 
 rice, 
 
 28 eggs, and half a gallon of spirits. 
 
 This being much more than the average consumption of the 
 men, women, and children, employed in the workshops of Great 
 Britain, it may fairly be assumed, that the world furnishes four 
 millions of laborers with food and clothing, and with shelter, 
 too the chief part of the timber there consumed, being drawn 
 from abroad. 
 
 To the stock of food above given, we have now to add, the 
 total quantity of coffee and tea, of cocoa and sugar, of lemons 
 and oranges, of figs and raisins, of spices and tobacco, consumed 
 by the whole eight-and-twenty millions of the population of the 
 United Kingdom. 
 
 Of raw materials, foreign nations supply all the cotton and silk, 
 all the oil, all the saltpetre, and all the dye-stuffs; of hides, wool, 
 flax, hemp, and various other articles, they not only furnish all 
 that is re-exported in the shape of manufactures, but as much 
 more as is adequate to meet the demands of a large portion, if 
 not even of the whole, of the four millions above referred to 
 who may, therefore, be considered as being fed, clothed, lodged, 
 and supplied to the English people, by the other communities of 
 the world. 
 
 The whole number of persons, old and young, male and female, 
 employed, in 1841, in the 
 
 Cotton, hose, lace, wool, worsted, silk, flax, and linen manufac- 
 tures of Great Britain, was .'. 800,246 
 
 In the mines 193,825 
 
 In the working of metals, as smelters, founders, blacksmiths, 
 nail-makers, brass-founders, cutlers, pin and needle makers, 
 file and lock makers thus embracing all the persons con- 
 nected with the conversion of ores into metals, and metals 
 into instruments, whether for the use of the farmer or the 
 manufacturer, the builder of houses or the maker of cloth 
 was 803,368 
 
 Making a grand total of 1,297,439
 
 128 LETTERS TO THE 
 
 The number so employed in 1851 must have been greater, and 
 may perhaps be properly estimated at 1,500,000. If so, it fol- 
 lows, that the people of the world feed, clothe, and shelter, and 
 thus furnish the labor of, nearly three times as many persons as 
 are, in England, employed in mining her coal and her iron ; in 
 smelting her ores, and making her pig, bar, and railroad iron ; in 
 constructing her machinery of every description ; and in convert- 
 ing iron, copper, brass, cotton, wool, silk, hemp, and flax, into the 
 commodities required for consumption. Thus, in addition to 
 furnishing nearly all the raw materials, they supply all the labor ; 
 and, further, they supply food, cloth, and lodging, for two and 
 a half millions of persons otherwise employed. 
 
 Of the million and a half, there is, however, but a small pro- 
 portion that is employed in working for the foreigners who sup- 
 ply this food, and these raw materials. Of the commodities 
 exported, nearly all are of the coarser kinds, requiring very little 
 of either skill or taste for their preparation. Thus, for instance, 
 out of an export of 87,000,000 sterling in 1854, nearly 
 15,000,000 consisted of metals in almost their rudest state 
 having given occasion to the exertion of very little more than brute 
 force. Coals constituted 1,500,000 ; while mere yarns amounted 
 to 10,000,000. Cotton cloths, averaging only 3^7., or f cents, 
 per yard, were nearly 24,000,000. Linens, averaging 8d. a 
 yard, made more than 4,000,000 ; while earthenware, alkali, 
 beer and ale, butter, candles, cordage, fish, salt, and wool, con- 
 tributed 5, 000, 000 towards the mass. The difference between 
 the pictures presented by the French and English exports is most 
 remarkable the former exhibiting scarcely anything that has 
 not been very highly elaborated and the latter furnishing 
 evidence, that, of all the vast quantity of commodities received 
 from the world, those returned have undergone that lowest amount 
 of preparation required for their reception among an inferior po- 
 pulation. With the exception of machinery and millwork to an 
 amount less than 2,000,000, and hardware and cutlery to about 
 double that sum, there is scarcely any thing in the list of English 
 exports requiring either taste or skill. Seeing that such is the 
 fact, it may well be doubted if more than one-fourth of the labor 
 given to manufactures or that of four hundred thousand hands 
 is applied to the conversion of the raw materials exported; 
 but, to avoid the possibility of error, we may assume it to be even 
 as high as one-third = five hundred thousand persons being 
 one for every eight whose labor is, as has above been shown, fur- 
 nished by the agricultural nations which find themselves compelled 
 to look to Britain for a market. 
 
 The account between that country and the world at large would 
 now appear to stand as follows :
 
 PRESIDENT OF THE UNITED STATES. 
 
 129 
 
 GREAT BRITAIN. 
 
 DR. 
 
 OR. 
 
 By the labor of half a million of per- 
 sons men, women, and children 
 employed in the lowest order of the 
 labors of conversion. 
 
 By a small portion of the raw mate- 
 rials supplied. 
 
 To the labor of four millions of per- 
 sons there employed, while fed, 
 clothed, and lodged, by other na- 
 tions. 
 
 To the sugar, tea, coffee, tobacco, 
 fruit, and other commodities, re- 
 quired for the consumption of 
 twenty-eight millions of persons. 
 
 To the cotton, flax, silk, hemp, lum- 
 ber, and other raw materials, re- 
 quired for domestic consumption, 
 and for exportation. 
 
 Having studied the extraordinary picture that is here presented, 
 I will now beg of you, Mr. President, to look once more to 
 Mr. Gee's sketch of the Colonial system, given in my last, there 
 to find the assertion that "not one-fourth part" of the products 
 of the laborers of British colonies "redounds to their own profit" 
 they obtaining in return, nothing but "clothing and accommo- 
 dation for their families," and being brought, thereby, so much in 
 debt, as to be compelled to mortgage their estates, and to pay 
 high interest to the mortgagees. That done, I have next to re- 
 quest, that you will look to the following sketch of the movement 
 of the cotton trade, with a view to the determination of the ques- 
 tion, whether, under the existing policy of the country', we are, 
 or are not, with each successive year, becoming more completely 
 subject to the Colonial system : 
 
 Forty years since, the cotton imported into England amounted 
 to 96,000,000 of pounds ; and it commanded then 20^d. per pound 
 equal to 8,200,000.* 
 
 About thirty years later, the movement of the trade, according 
 to the same authority, was as follows : 
 
 Raw material, 500,000,000 pounds, at 5d. per pound 10,000,000 
 
 Wages of 542,000 spinners, weavers, bleachers, &c., at 24 a 
 
 year each f. 13,000,000 
 
 Wages of 80,000 engineers, machine-makers, smiths, masons, 
 
 joiners, &c., at 50 a year each 4,000,000 
 
 Profits of the manufacturers, wages of superintendents, sums to 
 
 purchase the materials of machinery, coals, &c. 9,000,000 
 
 36,000,000 
 
 We see, here, that while the raw material consumed was more 
 than five times as great, the selling price in England was less 
 than 25 per cent, greater. When, however, we reflect that with 
 every stage of this increase, it had been necessary, because of the 
 unceasing exhaustion of the land in cultivation, to resort to new 
 
 * McCuLLOCH : Commercial Dictionary ; article, Cotton.
 
 130 LETTERS TO THE 
 
 and more distant lands, with constant increase in the cost of trans- 
 portation and when we deduct the domestic charge thus created, 
 together with the freights, storages, brokerages, and other claims, 
 upon this immense quantity we find that these 500,000,000 
 pounds could have yielded their producers, of the various parts 
 of the world, not more than 5,000,000; or less than, thirty years 
 before, had been received by the producers of 96,000,000; and 
 less, too, than was required to pay for the damage done to the 
 land leaving altogether out of view the cost of cultivation.* 
 
 The 5,000,000 thus paid for the use of so many millions of 
 acres, became 36,000,000 before they left the factory ; and yet, 
 as we have seen, the changes effected in them were such as re- 
 quired only the lowest species of skill. Thence, they passed out 
 to Turkey and India, Ireland and Portugal, Jamaica and Spain, 
 the United States and Canada ; and before they reached the con- 
 sumers they had become not less than 60,000,000 ; about one- 
 twelfth of which went to the cotton-grower, while the other eleven- 
 twelfths were absorbed on the road between those who raised the 
 wool, and those who wore the cloth giving support to thousands, 
 and tens of thousands, of men employed in blocking the wheels of 
 commerce. The consequences of this are seen, Mr. 'President, in 
 the facts, that the planter important as is his commodity can 
 nowhere obtain proper machinery of cultivation ; that his lands 
 are everywhere being exhausted ; and that slavery becomes from 
 
 * "Few crops," says a Southern journal, "are more exhausting to the 
 Boil than is the cotton crop. An immense amount of manure, usually con- 
 sisting, for the most part, of decayed leaves, limbs, and forest mould, is 
 required to keep the land of a cotton plantation in good condition. Another 
 difficulty is, that cotton requires later cultivation than any other crop, leav- 
 ing the planter but little time to enrich or improve his farm as he may 
 desire. An Alabama planter says, that cotton has destroyed more than 
 earthquakes, or volcanic eruptions. Witness the red hills of Georgia and 
 South Carolina, which have produced cotton till the last dying gasp of the 
 soil forbade any further attempt at cultivation; and the land, turned out to 
 nature, reminds the traveller, as he views the dilapidated condition of the 
 country, of the ruins of ancient Greece." 
 
 The effects of this, as exhibited in South Carolina, are thus stated in a 
 recent address issued by the Agricultural Convention recently held in that 
 State : 
 
 "Your committee would earnestly bring to the attention of this convention 
 the mournful fact, that the interest heretofore taken by our citizens in agri- 
 cultural improvement has become stationary; that our old fields are enlarg- 
 ing; our homesteads have been decreasing fearfully in number; and our 
 energetic sons are annually seeking the rich and fertile lands of the South- 
 west, upon which they imagine that treble the amount of profits can be 
 made upon capital than upon our own soils. Nor is this all. We are not 
 only losing some of our most energetic and useful citizens, to supply the 
 bone and sinew of other States, but we are losing our slave population, which 
 is the true wealth of the State. Our stocks of hogs, horses, mules, and 
 cattle, are diminishing in size and decreasing in number, and our purses are 
 being strained for their last cent to supply their places from the Northwest- 
 ern States."
 
 PRESIDENT OP THE UNITED STATES. 131 
 
 year to year more and more the lot of the laborers of all cotton- 
 producing countries. Such are the necessary results of the system 
 that looks to cheapening the raw materials of manufacture, and to 
 increasing the difference between their price and that of the fin- 
 ished commodities into which they are converted. 
 
 Eleven-twelfths, or fifty-five millions of pounds, are divided 
 among middlemen and of this enormous sum four-fifths, pro- 
 bably, centre in the owners of English ships, mills, and other 
 machinery of exchange and transportation. To pay this, it is 
 required, that the agricultural nations send to England enormous 
 quantities of tea, coffee, sugar, indigo, and other commodities 
 while themselves wasting, daily, more labor than is employed, 
 monthly, in all the mines and factories of the United Kingdom. 
 Hence their inability to obtain improved machinery ; and hence 
 the necessity they are everywhere under, of confining themselves 
 to the work of scratching out, and selling, the soil. 
 
 The direct effect of the reduction in the price of cotton has 
 been, and is, that of forcing labor into the production of sugar, 
 with similar effect enabling the people of England to obtain 
 three pounds for the price they before had paid for one, but ruin- 
 ing the people of Jamaica. The decline in the price of sugar 
 forced labor into the production of coffee, and that, in its turn, 
 fell in price there being a solidarity of interest of prosperity , 
 or of adversity among all the agriculturists of the world. Our 
 farmers and those of Russia and Germany were injured by the 
 stoppage of manufactures in Ireland, because it had the effect of 
 diminishing the Irish consumption of food, and forcing large quan- 
 tities on the English market. The planters were injured by it, 
 because it not only stopped the consumption of cotton among the 
 Irish people themselves, but by forcing large quantities of labor 
 upon England it lessened the power of the English laborer to 
 consume either food or cotton. That all communities prosper by 
 the prosperity of all others, and that all suffer from injury received 
 by others, is a truth that will, Mr. President, at some day, come 
 to be admitted ; and when it shall be so, the farmers and planters 
 of the world will be found combining together to compel the 
 maintenance, in the conduct of public affairs, of a sound morality 
 looking to the advancement of the interests of commerce, and 
 to their own emancipation from the tyranny of trade. 
 
 So, too, is it with the laborers of the world. Whatever tends 
 to impair the condition of those of India is injurious to those of 
 France and England ; and therefore it is, that those nations would 
 find it profitable to carry out in their international relations the 
 same morality that is required between man and his fellow-man. 
 The low prices of sugar and cotton, and consequent slavery of 
 the producers of those commodities, are but consequences of the 
 system that has so much tended towards the. enslavement of the 
 workers in iron and cotton that one which has sought the anni-
 
 132 LETTERS TO THE 
 
 hilation of the power of association and combination everyvhere 
 outside of Britain. 
 
 What, Mr. President, is it, that the British manufacturers de- 
 sire ? What is the object of the "warfare" that, as we are told 
 by the highest British authorities, is now carried on against the 
 agricultural nations of the world ? Is it not, that of cheapening 
 raw materials, while maintaining at their highest, the prices of fin- 
 ished commodities ? That such is the case, cannot be denied. 
 
 What is it, on the other hand, that our farmers and planters 
 desire ? Is it not the reverse of this ? Do they not wish to have 
 raw products dear, and finished commodities cheap ? That they 
 do so, is certainly true. 
 
 What is the policy, Mr. President, advocated by the foreign 
 manufacturer ? Is it not that one, which is commonly called free 
 trade ? It is so, certainly. In advocating it, does he desire to 
 carry out his own views, or those of the planter ? Does he desire 
 to raise the price of food and cotton ? Does he not, on the con- 
 trary, desire to cheapen both ? Does he desire to tax himself, for 
 maintaining the millions of tons of shipping required for carrying 
 enormous masses of raw products to the ports of Britain ? Does 
 he not, on the contrary, wish to throw upon the producers all the 
 cost of transportation ? Does he not know, and feel too, that, 
 under that system, they receive the most trivial share of their pro- 
 ducts the remainder being absorbed by traders, transporters, 
 brokers, and middlemen of all descriptions ; and is it not for these 
 reasons, that he urges upon the world the adoption of the free-trade 
 system ? That it is so, is unquestionably true. 
 
 The objects of the two parties being thus so widely different, is 
 it possible that both can be attained by the pursuit of any one set 
 of measures ? Can the system invented for the purpose of depress- 
 ing the prices of raw products raise them ? Can that which looks 
 to maintaining the prices of finished products, lower them ? It 
 cannot ; and yet, every measure of our central government, in re- 
 gard to trade, for the last twelve years, has had the fullest appro- 
 bation of the advocates of that system. Could we desire better 
 evidence, that those measures are hostile to the interests of both 
 farmer and planter ? 
 
 The more, Mr. President, that you shall study the subject, the 
 more will you be satisfied, that to the policy of that government 
 is due the depression in the prices of all our products, to which 
 your attention has been called ; and that, it is to its errors, and 
 not to excess in the amount of power retained by the States, when 
 they adopted the Constitution, we owe the monetary difficulties 
 you have so well described. 
 
 Yours, very respectfully, 
 
 HENRY C. CAREY. 
 Philadelphia, February 23d, 1858.
 
 PKESIDENT OF THE UNITED STATES. 133 
 
 LETTER TWENTY-THIRD. 
 
 Two systems, Mr. President, are before the world one, whose 
 objects are to be promoted by increasing the competition for 
 the sale of all the raw materials of manufacture, labor included ; 
 another, which looks to increasing the competition for their pur- 
 chase. 
 
 The first, tends towards maintaining, and even augmenting, the 
 necessity for machinery for transportation thus increasing the 
 influence of the trader. The second, would promote the growth 
 of the power of combination, and thus diminish the necessity for 
 such machinery while enlarging the field of commerce. 
 
 The first, looks to widening the space by which the producer 
 and the consumer are separated ; the second, to its contraction. 
 
 The one, would increase the difference between the prices of 
 raw materials and finished commodities ; the other, would secure 
 their more close approximation. 
 
 The one, looks to increasing the proportion of mental and phy- 
 sical power given to trade and transportation, and thus diminish- 
 ing that which might be applied to production ; the other, to an 
 increase in the proportion given to production, and a diminution 
 in that applied to effecting changes in the places of the things 
 produced. 
 
 The one, was reprobated by Adam Smith ; the other, is in full 
 accordance with his doctrines, as well as with those of Colbert, 
 the most distinguished of all the sons of France. 
 
 Leader in the advocacy of the first has been, and is, Great Bri- 
 tain. Leader in the establishment of the second, and most con- 
 sistent in its maintenance, is France ; and thus, after so many 
 ages of almost ceaseless efforts to do each other injury, by means 
 of warlike operations, are these two nations now engaged in a 
 peaceful contest for the leadership of the world ; but, peaceful as 
 it is, it is destined to exert an amount of influence, compared 
 with which that resulting from the movements of fleets and armies 
 in the past, will prove to have been entirely insignificant. 
 
 For centuries, both have been almost unceasingly engaged in 
 war, but widely different have been the objects sought to be at- 
 tained France having fought for glory and dominion, while 
 England has looked with a single eye to the establishment of the 
 supremacy of trade. Equally different have been their respective 
 policies France having imitated Rome, who, universal plun- 
 derer as she was, left the local arrangements of her provinces un- 
 touched ; while Great Britain has imitated Holland, in seeking to 
 monopolize the machinery of trade and transportation, and thereby 
 compelling strangers to make their exchanges in her single market.
 
 134 LETTERS TO THE 
 
 The policy of the one has been that of the soldier ; that of the 
 other has had for its foundation, the single idea of "buying in the 
 cheapest, and selling in the dearest market." 
 
 Colbert wished that French colonists should refine their own 
 sugar and make their own cloth. England, on the contrary 
 desiring that the " mischievous practice " might be prevented 
 inserted in her grants of land, clauses " declaring the same to be 
 void," should the grantee "apply himself to the making of wool- 
 len, or such like, manufactures. " Seeking the enlargement of 
 commerce, France, under the lead of Turgot, abolished the mono- 
 polies of earlier times; while, at the same moment, the Parliament 
 of England looking always towards trade was adding, year 
 after year, to the restrictions upon the movements of her artisans, 
 and thus creating a monopoly to be held against the world. 
 
 The system of the one, is based upon the idea of cheapening the 
 raw produce of the earth, and the labor of him by whom it is tilled. 
 The other, seeks to protect the laborer, by bringing the market to 
 his door, and thus giving value to his land. 
 
 The closer the approximation of the price of the raw material 
 and the manufactured commodity, the smaller, necessarily, is the 
 proportion of the product of labor appropriated to the payment 
 of the transporter, the trader, the soldier, and all others of those 
 classes standing between the men who labor to produce, and those 
 who need to consume the things produced. The closer that ap- 
 proximation, the more rapid will be the circulation, the more 
 instant the demand for labor and its products, and the greater the 
 power to apply the faculties of mind and body to the work of con- 
 version while giving a constantly increasing proportion to the 
 labor of developing the riches of the earth, and thus augmenting 
 the quantity of things susceptible of being converted. In France, 
 the quantity of food has increased twice more rapidly than the 
 population ; and yet, her manufacturing industry has attained such 
 large dimensions, that its product is given at 4,000,000,000 of 
 francs, or nearly $800,000,000* being, probably, twice the 
 anjount of the total yield of land and labor, a century since. The 
 movement, too, is a constantly accelerated one. Forty years since, 
 France absorbed but 60,000 bales of cotton ; now, she requires 
 400,000. Then, the whole value of the silks manufactured, but 
 little exceeded 100,000,000 of francs ; now, it exceeds 400,000,000. 
 Then, she made but little iron ; now, she makes more than 500,000 
 tons being as much as was produced in Britain, thirty years since. 
 Then, her mines yielded but 800,000 tons of coal ; now, the quan- 
 tity exceeds 5,000,000 having sextupled in that brief period. 
 
 * This sum has reference to the additional value given to raw products by 
 the processes of manufacture, and is not to be understood as including that 
 of the materials themselves. The total amount of commodities manufactured 
 is given at 8,000,000,000 of francs.
 
 PRESIDENT OF THE UNITED STATES. 135 
 
 These are great changes ; and yet, so far are they from having 
 oeen attended with diminution in the proportion of physical and 
 mental faculty given to agriculture, that they are the cause of a 
 constant increase therein. 
 
 A century since, France could have fed with wheat seven mil- 
 lions of people. Now, she could feed more than twenty millions.* 
 Then, the corn, potatoes, and other vegetables, if equally divided 
 among the population, would have given about 800 pints per head. 
 Now, it would give more than twice that quantity ; and of the 
 change thus manifested, by far the larger portion has occurred in 
 the forty years through which we last have passed. This, Mr. 
 President, is a great change, and yet it is but a part of what has 
 been effected. The policy of Colbert, in seeking to diversify the 
 modes of agricultural employment, having been carried out in 
 reference to sugar, the result is seen in the fact, that France has 
 now more than a hundred thousand acres devoted to the culture 
 of the beet-root producing sugar to the amount of sixty or 
 seventy millions of francs, equal to twelve or fourteen millions of 
 dollars ; and so cheaply is it supplied, that the sugar of the colo- 
 nies finds itself forced to implore protection against the domestic 
 manufacture. 
 
 In 1812, the total amount of silk cocoons produced but little 
 exceeded 5,000,000 kilogrammes ; now, it exceeds 15,000,000, 
 with a value of more than sixty millions of francs, or twelve mil- 
 lions of dollars. 
 
 France has now 32,000,000 of sheep, against 27,000,000 in 
 1813, and 20,000,000 in 1789; but the improvement in quality 
 has been far greater than that in quantity the demand from the 
 constantly growing woollen manufacture, having offered a large 
 bounty upon the devotion of time, mind, and means, to the im- 
 provement of the race. 
 
 Cloth has steadily declined in price, while wool has much 
 advanced ; and the corn that, a century since, would command but 
 twelve and a half francs, was worth nineteen francs in the deceminal 
 period ending in 1840. The prices of the raw material and of 
 the finished commodity are steadily approximating each other 
 thus affording the strongest evidence of advance in civilization. 
 The consequences of the increase of quantity, and of price, are 
 seen in the fact that whereas, eighty years since, the average 
 money-value of the produce of an acre of land was 87 francs, it 
 has since risen to no less than 237 having almost trebled. 
 
 We see, thus, Mr. President, that much of the augmented 
 money-value results from increase in quantity, and most especially 
 from increase in those bulky products of the earth, that will not 
 
 * That the change here indicated is still in rapid progress, is shown bj 
 the fact that while the average product of wheat in the years 1842-1848 was 
 only 72,000,000 hectolitres, that of 1847-1851 was no less than 86,000,000.
 
 136 LETTERS TO THE 
 
 ,bear transportation to distant markets. A further portion of it 
 is consequent upon the increased utility of many portions of the 
 produce, resulting from the existence of a market near at hand. 
 Thus, the wheat-straw, alone, is valued at 393,000,000 of francs, 
 or nearly $80,000,000 ; and the total value of the straw of France 
 at 761,000,000 of francs = $150,000,000 being more than the 
 total value of the cotton crop of the United States, which occu- 
 pies so nearly exclusively the land of no less than ten of our 
 States, and furnishes almost the whole employment of so many 
 millions of people. 
 
 As a general rule, France feeds herself. In thirty-three years 
 it occurred once in 1847 that her imports of food were ade- 
 quate to the supply of 2,700,000 persons. Twice in 1832 and 
 1846 she imported half that quantity. Six times, her imports 
 sufficed for the feeding of from three to four hundred thousand 
 persons ; but in nineteen of the thirty-three years her imports were 
 insignificant. 
 
 The annual average of her exports, in the ten years ending 
 1836, but little exceeded 500,000,000 of francs. In 1852, the 
 amount was 1,250,000,000 being an augmentation of 150 per 
 cent. ; while the average of the previous five years, including 
 those disastrous ones of 1848 and '49, exceeded 1,000,000,000; 
 and yet, large as was the increase, nearly the whole amount of 
 labor thus exported, directly represented food produced on the 
 soil of France. How small is the quantity of foreign raw mate- 
 rial that goes to the production of the goods exported, is shown 
 by the fact, that while the value of cotton fabrics exported in 1854 
 was 60,000,000 of francs, the weight was only 7,300,000 kilo- 
 grammes, or 16,000,000 of pounds giving an average of seventy- 
 five cents for the raw cotton that had passed into the hands of 
 the manufacturer at an average price, not exceeding ten. The 
 total weight of clothing and furniture exported in 1856 was under 
 40,000 tons a quantity that, as you have seen, Mr. President, 
 could be carried in forty ships of very moderate size ; and yet, in 
 that small bulk was contained little less than two hundred millions 
 of dollars' worth of French food, so condensed, in accordance with 
 the ideas of Adam Smith, as to enable it freely to travel to .the 
 remotest corners of the world. 
 
 The tendency of French policy is that of making manufactures 
 subsidiary to agriculture combining a small amount of foreign 
 raw materials with a large quantity of domestic ones, and thus 
 enabling her farmers cheaply to maintain commerce with distant 
 countries. Scarcely any thing passes out until it has attained a 
 form so high, as to cause the skill and taste, which represent her 
 food, to bear a very large proportion to the value of the raw 
 material that is used. Her exports of raw produce are insignifi- 
 cant in amount ; and even of wine, the amount exported but little 
 exceeds that of the years immediately preceding the Revolution
 
 PKESIDENT OF THE UNITED STATES. 137 
 
 the average from 1844 to 1846 having been only 1,401,800 hecto- 
 litres, against 1,247,700 tons from 1787 to 1789. 
 
 The total value of French produce and manufactures exported 
 in 1856 was 1,893,000,000 francs, or $370,000,000; and of this 
 large sum, the foreign raw materials could scarcely much have ex- 
 ceeded, even if they equalled, a fifth leaving 1,500,000,000 
 of francs as the actual value of food and other domestic products 
 furnished to the world, after having been reduced in bulk, so as to 
 economize to the utmost extent, the cost of transportation. Land 
 and labor rise in value precisely as they are emancipated from 
 that first and most oppressive of taxes ; and therefore it is, that 
 we witness so large an increase in the price of those of France. 
 
 In 1821, her real estate was valued, and the amount re- 
 turned to the government was 39,514,000,000 francs, or nearly 
 $8,000,000,000. A similar valuation having been made in 1851, 
 and before the California gold deposits had begun to affect the 
 movements of the world, the amount was found to have risen to 
 no less than 83,744,000,000 francs, or $16,000,000,000 having 
 more than doubled in the short period of thirty years. In the 
 same year, the total value of the real estate of the Union was re- 
 turned at $3,889,000,000; but, as subsequently corrected at the 
 Census bureau, it was increased to nearly $5,000,000,000 that 
 having been given, as the true value of all the land and buildings 
 of the country. Were we now to add to this, even sixty per cent., 
 we should obtain a sum no greater than that which represents the 
 addition made to the value of the real estate of France, in thirty 
 years. It follows thence, Mr. President, that the fixed property 
 here created, in the whole period that has elapsed since the land- 
 ing of the Pilgrims, is far less in value than that created by the 
 French people, in the brief period you have so well described, of 
 constantly repeated financial convulsions among ourselves. 
 
 This is, certainly, a most extraordinary fact, and it behoves us, 
 Mr. President, to inquire into the causes of its existence. In 
 that period, France has maintained armies that have counted by 
 hundreds of thousands, while ours have counted by thousands. 
 She has made wars in Europe and Africa ; while, with the excep- 
 tion of our discreditable attack on Mexico, we have enjoyed a 
 peace that has been undisturbed. She has undergone a succes- 
 sion of violent revolutions ; we have had none but those resulting 
 from the operation of the ballot-box. Her land has been oppres- 
 sively taxed for the maintenance of fleets and armies, admirals 
 and generals, kings and emperors ; whereas, ours has not been 
 taxed for a single dollar, to be applied to the purposes of the cen- 
 tral government. Nevertheless, the land of France so steadily 
 rises in value, that it would now command thrice as large an 
 amount of money as could be obtained for all the real estate of 
 our Union. 
 
 Why, Mr. President, is it so ? Because, French policy looks
 
 138 LETTERS TO THE 
 
 to relieving the farmer from the tax of transportation, and thus 
 giving value to the land, and the man by whom it is cultivated ; 
 while ours looks to increasing that tax, and destroying the value 
 of laud. Because, the one looks to increasing the power of asso- 
 ciation and combination ; while the other looks to its destruction. 
 Because, the one looks to diversifying the pursuits of the people ; 
 while the other seeks, as far as possible, to limit the whole community 
 to the pursuits of scratching the earth, on one side, and trade and 
 transportation, on the other. Because, the one would tend to create 
 a scientific agriculture, and to promote demand for all the powers 
 of THE MAN ; while the other seeks to limit the demands upon its 
 people, to brute force, on one side, and craft on the other. Be- 
 cause, the one looks to increasing the products of the land, while 
 augmenting their prices ; and the other, to diminishing the yield, 
 while lessening the prices of the things produced. Because, the 
 one enables the people subject to it, to import the precious metals ; 
 while, the other compels their exportation. Because, the one 
 looks towards raising the value of the laborer, and making him 
 more free ; while, the other tends towards diminishing his value, 
 and thus making the slavery of the white man and the black, the 
 law of the land. Because, the one seeks to establish the indepen- 
 dence of both the people and the state ; while under the other, 
 colonial dependence grows from year to year. Because, finally, 
 the one looks to the extension of that domestic commerce which, 
 as you have so distinctly seen, is the only sure foundation of a 
 great foreign one ; while those to whom we owe the other, have 
 dreamed of the erection of a great foreign commerce, upon the 
 ruins of a domestic one. 
 
 The more, Mr. President, you study the commercial movement 
 of France, the more you will be satisfied of the accuracy of your 
 views as to the sort of free trade that is really needed by your 
 countrymen ; that sort which is required for giving wealth to the 
 people, and strength to the government. 
 With great respect, 
 
 Your obed't servant, 
 
 HENRY C. CAREY. 
 
 Philadelphia, February 26th, 1858.
 
 PRESIDENT OF THE UNITED STATES. 139 
 
 LETTER TWENTY-FOURTH. 
 
 THAT men, Mr. President, become more independent in their 
 actions, and more free to combine their efforts with their fellow- 
 men, as their faculties become more and more developed, is a 
 truth, whose evidence may everywhere be found. So, too, is it 
 with communities their independence of external action grow- 
 ing in the direct ratio of the variety in the demand for human 
 faculty among themselves. Tor proof that such is the case, we 
 may now, for a moment, look to the working of the English and 
 French systems the one based upon the idea of extending foreign 
 trade, at every cost to domestic commerce ; and the other, upon 
 that of creating a great internal commerce, as the sure foundation 
 of a profitable intercourse with other nations. 
 
 That the total number of persons of all descriptions, employed 
 in Great Britain in converting cotton into yarn, and in making 
 the inferior cloths, the pig iron, the earthenware, and other similar 
 commodities, by means of which that country not only pays for 
 all the supplies required for her numerous population, but is ena- 
 bled also to bring their producers so much in debt, does not 
 exceed half a million, is quite certain. That large quantities 
 of produce are there received, and that very little is given in 
 . return, is a fact that does not admit of doubt ; and one, too, the 
 conviction of whose existence must, sooner or later, force itself 
 upon the agricultural communities of the world. Were it now 
 fully understood, and were those communities to arrive at the 
 conclusion, that they might as well mine and smelt their own ores, 
 twist and weave their own cotton, and make their own earthen- 
 ware, at the same time saying to those few people "Come 
 among us and mine ore, make iron, spin thread, and weave cloth ;" 
 and that having been done were they to have the work per- 
 formed at home, that they now have done in England, the effect 
 would be, that instead of feeding four millions of people, they 
 would have but half a million to feed ; and instead of giving such 
 prodigious masses of cotton, sugar, coffee, lumber, dye-stuffs, 
 and other raw products, in exchange for a little cloth, and very 
 little iron, they would have the whole of that immense quantity 
 to apply to the purchase of improved machinery, or to that of 
 the comforts and luxuries of life. Such an operation would 
 require but few years for its accomplishment, and for the rea- 
 son, that the British system, based as it is upon the idea of 
 cheapening labor, has little tendency to create demand for any- 
 thing beyond mere muscular force. Dreading a competition that 
 could so readily be established, Great Britain is entirely de-
 
 140 
 
 LETTERS TO THE 
 
 pendent, for the maintenance of her power, upon the peaceful 
 submission of the agricultural communities, to the system of 
 trading: warfare, that, as you have seen, Mr. President, has beea 
 established ; established, too, in full accordance with the decla- 
 rations of some of the most eminent statesmen of England, in 
 reference to "the necessity for strangling in their infancy" all 
 attempts at competition with British makers of cloth and iron. 
 
 What, however, would be the effect upon France of a change 
 of policy, looking to full protection, on the part of Ireland, Tur- 
 key, Portugal, Brazil, India, the United States, and other coun- 
 tries ? Would she be placed in a similar position ? She would 
 not, because her policy is that of thoroughly elaborating and per- 
 fecting her own rude products, and those of other lands received 
 in exchange. With her, the value of the raw material bears but 
 a small proportion to that of the finished commodity ; and while 
 she sends to the world the finest silks and cloths, wines and por- 
 celain, her rival exports cotton-twist, blankets, coal, pig and bar 
 iron, beer, and earthenware. The one aspires to lead the world, 
 while the other seeks to underwork it. In the one, artistic taste 
 is being from day to day more fully stimulated into activity ; 
 whereas, in the other, the tendency towards making of man a 
 mere machine, increases from year to year. The one looks to the 
 cheapening of labor and land ; whereas, the policy of the other 
 tends towards raising the price of both. 
 
 Those who desired to supersede the one, would require only the 
 lowest description of manufacturing skill to be acquired in the 
 briefest period ; whereas, those who sought to supplant the other, 
 would need a skill to be acquired only at the cost of very many 
 years of application ; and a taste, for the development of which 
 would be required a ready access to works of art ; and, whatever 
 might be their progress, France would still continue in advance. 
 
 In proof that such would be the case, we need only take the 
 tables of exports doing which, we find that France finds her 
 customers chiefly in those countries that are already largely manu- 
 facturing, and that are, themselves, anxious to compete with her, 
 to wit : 
 
 England 250,000,000 francs. 
 
 United States.... 162,000,000 " 
 
 Belgium 121,000,000 " 
 
 Sardinia 72,000,000 " 
 
 Spain 65,000,000 " 
 
 Switzerland 58,000,000 francs. 
 
 Zoll-Verein 42,000,000 
 
 Russia 14,000,000 " 
 
 Hanseatic Cities. 13,000,000 " 
 Holland 15,000,000 " 
 
 Adding to these the colony of Algeria, 103,000,000, we have 
 905,000,000 exported in 1852 leaving 345,000,000 for the rest 
 of the world ; and nearly all that balance is so divided, as to show 
 that France is, everywhere, ministering to the tastes of the more 
 refined portions of the various communities of the world. So far, 
 therefore, is she from fearing competition, that she has reason to
 
 PRESIDENT OF THE UNITED STATES. 141 
 
 desire it knowing that with every increase in the power, any- 
 where, to make cotton and woollen cloths, and iron, there arises 
 an increased demand upon her workshops, for commodities re- 
 quiring that high development of the artistic faculty, which she 
 alone can furnish. 
 
 Turning to England, we find that her exports, in the same year, 
 to the advancing portions of Europe, that is to say 
 
 To Europe, exclusive of Turkey, Italy, and Portugal amount 
 
 to only 19,000,000 
 
 While the raw material that has undergone the single process 
 of twisting, and that goes only to manufacturing countries 
 amounts, alone, to 10,000,000 
 
 Adding to this, the unmanufactured metals, and the coal, sent to 
 those countries, we shall obtain almost all the balance England 
 having, in fact, but little to send to any country that is itself 
 advancing in civilization. 
 
 To this country, the exports were more than 16,000,000 ; but 
 of this, nearly the whole amount consisted in common cottons and 
 woollens, iron, and other articles requiring little skill or taste ; 
 while from France were imported nearly all of those in the pre- 
 paration of which artistic skill was manifested. Deducting the 
 two quantities above referred to, there now remain no less than 
 38,000,000, or more than half of the whole, for India, Australia, 
 Portugal, Turkey, Buenos Ayrcs, Mexico, and other countries, 
 in which there exist few manufactures ; and in which, consequently, 
 are found the evidences of barbarism raw materials being cheap, 
 while finished commodities are dear. 
 
 The French system is based upon the idea of the enlargement 
 of commerce resulting fromHhe compression of raw commodities 
 into their smallest form ; and from the^ emancipation of the farmer 
 from the tax of transportation. Commerce grows with the growth 
 of the powers of man ; and therefore would France profit by the 
 adoption in other countries, of the system that has so well been 
 carried out at home. 
 
 The English system is based on the idea of the supremacy of 
 trade, and the augmentation of the tax of transportation. Trade 
 grows with the growth of man's necessities; and therefore would 
 England suffer under any system leading, in other countries, to 
 development of the faculties, and increase in the powers, of man. 
 
 Such being the case, we can now readily account for the steadi- 
 ness of the commercial policy of the one, notwithstanding the 
 shocks of repeated revolutions ; and for the exceeding unsteadi- 
 ness of the trading policy of the other, although political revolu- 
 tions are there unknown. The one, after long experience, has 
 recently announced to the world, through the President of the 
 Council, M. Baroche, its determination "formally" to "reject 
 the principle of free trade, as incompatible with the independence
 
 142 LETTERS TO THE 
 
 and security of a great nation, and as destructive of her noblest 
 manufactures. No doubt," as he continued, "our customs tariffs 
 contain useless and antiquated prohibitions, and we think they 
 must be removed. But protection is necessary to our manufac- 
 tures. This protection must not be blind, unchangeable, or ex- 
 cessive ; but the principle of it must be firmly maintained." 
 The other, on the contrary, has changed its system repeatedly, 
 and especially within the last five-and-thirty years. Until 1825, 
 it had gone on heaping protection upon protection ; but since 
 that time, its policy has been altered and re-altered, until the 
 form of the existing one, bears hardly the slightest resemblance 
 to that of the days of George III., although the spirit remains 
 the same. 
 
 The one is quiet, tranquil, and confident, in its forward move- 
 ment ; whereas, the other, restless and doubtful, is unceasingly 
 engaged in wars for the extension of trade ; military wars, carried 
 on by soldiers and sailors, admirals and generals ; and trading 
 wars carried on by means of "large capitals" so directed as to 
 crush but competition, abroad or at home. 
 
 The one is rapidly becoming the leader of the advancing nations 
 of Europe ; whereas, the other is gradually surrounding itself with 
 the ruins of once-important nations, that have been its friends. 
 
 The policy of the one is in accordance with the views of its own 
 illustrious Colbert; and with those of Adam Smith, when teach- 
 ing that " that country in whpse cargoes there is the greatest pro- 
 portion of native, and the least of foreign, goods, will always be 
 the principal gainer." The other is in harmony with the doc- 
 trines of Sir Robert Peel, who taught that England's governing 
 principle should be found, in the single determination to " buy in 
 the cheapest market, and sell in the dearest one " buying labor, 
 at home and abroad, at a low price, and selling it, both at home 
 and abroad, at a high one. The one looks to the elevation and 
 enfranchisement of man ; the other, to the subjection of the laborer 
 to the trader, and to his ultimate enslavement. 
 
 What, now, Mr. President, is our condition, as compared with 
 that of France ? Can we maintain commerce where we will ? 
 Are we not, on the contrary, forced to go where we must ? Can 
 we send wheat, or corn, to the people of California, or Australia ? 
 Do those of Brazil, or India, desire to purchase rice or cotton ? 
 Assuredly not their demands upon the outer world being for 
 finished commodities, and not for the rude products of the soil. 
 How, then, do we maintain commerce with Brazil and California ? 
 Is it not by the circuitous route of Manchester and Lyons the 
 whole of the tax of transportation being paid by the farmers and 
 planters of the Union? That it is so, cannot be questioned. 
 
 France, on the contrary, sends the rude products of her soil to 
 every country of the world having first combined tons of corn 
 and potatoes with pounds tof silk and cotton, clay and gold, in
 
 PRESIDENT OF THE UNITED STATES. 143 
 
 accordance with the advice of Adam Smith. Sending hundreds 
 of millions, in value, compressed into tens of thousands of tons, in 
 bulk, she is enabled to throw upon those who send her raw mate- 
 rials, all the cost of transportation, while establishing, from year 
 to year, an independence more complete. We, on the contrary, 
 forced to maintain commerce with the world, through the medium 
 of foreign ships and mills, become daily more and more dependent. 
 Why, Mr. President, is it so ? Because the central government 
 refusing to perform the duties devolved upon it by the States 
 limits its views to its own protection, and neglects the protection 
 of the people. 
 
 As a consequence of this unhappy state of things it is, that the 
 planter is compelled to pray for short crops instead of large ones. 
 With the one freights being low, while prices are high he is 
 enriched. With the other freights being high, and prices low 
 he is impoverished. So, too, with our farmers, dependent, as 
 they everywhere are, upon the trivial demand of Europe, conse- 
 quent upon short crops in England, France, or Germany. Give 
 them that great domestic commerce, the need of which is to your- 
 self, Mr. President, so very evident that commerce which France 
 so rapidly obtains and they will, then, be enabled to rejoice in 
 the prosperity of the agricultural interest everywhere. 
 
 Hoping that by aid of reforms to be initiated by yourself, our 
 farmers and planters may be enabled to obtain that free inter- 
 course among themselves, and with the outside world, of which 
 they have been so long deprived, I remain, Mr. President, 
 With great respect, 
 
 Your obed't servant, 
 
 HENRY C. CAREY. 
 
 Philadelphia, March 3rd, 1858.
 
 144 LETTEKS TO THE 
 
 LETTER TWENTY-FIFTH. 
 
 WE are constantly assured, Mr. President, that the protective 
 system, favorable as it may be to commerce at home, tends to the 
 annihilation of foreign commerce. All the facts of history tend, 
 however, to prove the reverse of this the power to maintain 
 intercourse with foreign nations having always grown with the 
 growth of domestic commerce, and it having been by the latter's 
 help, alone, that the former has been maintained. The great de- 
 velopment of British external commerce followed that of the inter- 
 nal one, which owed its existence to a protective system of the 
 most stringent character. So, too, has it been, with all the pro- 
 tected countries of Europe the power to maintain exterior com- 
 merce having, everywhere, followed the adoption of measures 
 looking to the development of an internal one, as is shown by the 
 following facts : 
 
 From 1826 to 1835, as we have seen, the domestic exports of 
 France averaged only 500,000,000 francs; from 1845 to 1849, 
 they averaged 1,000,000,000 ; and in 1856, they had attained the 
 enormous amount of 1,893,000,000 having almost quadrupled 
 in the five-and-twenty years, during which we have been subjected 
 to such repeated crises, consequent upon the determination of the 
 Federal government to secure to itself the control of the local 
 banks and their circulation. 
 
 In the free-trade period of Russia, from 1814 to 1824, the quan- 
 tity of foreign merchandise consumed averaged only $32,000,000 
 a year. Growing gradually, by aid of highly protective measures, 
 the power of that country to be a customer to foreign nations, had 
 risen, at the opening of the Crimean war, to $75,000,000. 
 
 The domestic exports of Belgium, in 1828, amounted to only 
 156,000,000 francs. By 1850, they had become 263,000,000. 
 In 1856, they were 375,000,000 the exports of food from that 
 little country, with its four and a half millions of people, having, 
 thus, been greater than our own average, in the decade ending in 
 1855 embracing, as it did, the periods of the Irish famine, and 
 the short crops of Germany and France. Belgium follows the 
 advice of Adam Smith, in combining her food and wool in the 
 form of cloth, and thus enabling it to travel cheaply to the most 
 distant countries. We repudiate it, and hence the inability of our 
 farmers to maintain commerce with the world. 
 
 Spain, impoverished as she has been, by the ' ' warfare ' ' of the 
 smugglers of Gibraltar, and by repeated revolutions, increased 
 her exports from 71,000,000 reals, in 1827, to 166,000,000, in 
 1852
 
 PRESIDENT OF THE UNITED STATES. 145 
 
 Why it is, Mr. President, that such have been the uniform 
 effects of the adoption of a system looking to the protection of the 
 farmer in his efforts to bring the consumer to his side, and thus 
 relieve himself from the tax of transportation, will readily be un- 
 derstood by all who study the following facts, in reference to the 
 highly protected country of the Zoll- Verein : 
 
 Forty years since, Great Britain received from Germany only 
 3,000,000 of pounds of wool; but, with the decline of German 
 manufactures, the export of raw materials so largely increased, 
 that, in 1825, the receipts in England, from that source alone, 
 amounted to no less than 28,000,000 a large portion of which 
 was paid for in English cloth. Such having been the state of the 
 trade, it follows, necessarily, that wool in Germany must have been 
 cheaper than in England, while cloth must have been dearer the 
 prices of the two having been widely distant from each other. 
 
 In 1851, the quantity of wool, and woollen yarn, imported into 
 Germany, amounted to 34,000,000 of pounds, and the quantity 
 exported to 9,000,000 leaving not less than 25,000,000 as the 
 net import, and proving that wool in Germany must have been 
 higher than in other countries. In the same year, the quantity 
 of woollen cloth exported, amounted to 12,000,000 of pounds 
 proving that it must have become cheaper than in other countries. 
 The prices of raw material and finished articles had steadily ap- 
 proximated to each other, and thus was furnished the most con- 
 clusive evidence of advancing civilization. 
 
 Two-and-twenty years since, the import of cotton, and yarn, into 
 Prussia, amounted to 16,000,000 of pounds having increased, 
 in the twelve years that had then elapsed, but 6,000,000. The 
 movement in the Zoll- Verein, in the period that has since elapsed, 
 is thus given : 
 
 1836. f 1845. 1851. 
 
 Cotton 152,364 cwts 443,847 cwts 691,796 cwts. 
 
 Cotton twist 244.869 " .. 574.303 " .. 676.000 " 
 
 397,233 cwts. 1,018,150 cwts. 1,362,796 cwts. 
 
 The export of yarn and cloth, in this latter year, amounted to 
 159,241 hundredweights, leaving for domestic consumption more 
 than 1,200,000 hundredweights, or 130,000,000 of pounds this 
 proving, first, that cotton cloth had become very cheap ; second, 
 that the power of consumption, among the agricultural population, 
 had largely increased. That increase was a necessary consequence 
 of the enlargement of the market for labor, and for the products 
 of land, resulting from the extension of this manufacture. The 
 weight of cotton goods exported, was, as we see, less than an 
 eighth of that of the wool and yarn imported ; and yet, the value 
 of that small quantity, was 20,000,000 of thalers = $15,000,000 
 being almost enough to pay for the whole import. At least 
 10
 
 146 LETTERS TO THE 
 
 three-fourths of this large sum consisted of labor representing 
 German food, thus enabled readily to go to distant countries. 
 
 Thirty years since, Germany supplied the world with rags, and 
 imported paper, of which her consumption was then but small. 
 In 1851, all had changed ; the net import of the first having been 
 37,000,000 of pounds, while the net export of paper had risen 
 to 3,500,000. In the first period, rags were cheaper than in other 
 countries, while paper was dearer. In the second, rags were 
 dearer, while paper was cheaper. The prices of the two had 
 greatly approximated ; and therefore had the consumption of 
 paper so much increased as to absorb not only the whole quantity 
 produced at home, but, in addition thereto, more than 30,000,000 
 pounds produced abroad. You will, Mr. President, more fully 
 appreciate the value of these facts, when you reflect how large 
 must have been the domestic production of rags, resulting from an 
 addition to the consumption of cotton amounting to more than 
 100,000,000 of pounds weight. 
 
 In 1830, the quantity of coal that was mined was but 7,000,000 
 tonnes and adding thereto 1,200,000 of brown coal, we have 
 a total of 8,200,000. In 1854, the first had increased to 
 34,000,000, and the last to 12,000.000 making a total of 
 46,000,000. 
 
 In 1834, there were made 76,000 tons of bar iron. In 1850, 
 the quantity had risen to 200,000 ; and the pig iron that was 
 made amounted to 600,000 tons. The present consumption of 
 the Zoll- Verein is given at fifty pounds per head, per annum 
 being more than in any country of Europe except France and 
 Belgium ; and more than in any country of the world, except the 
 two already named, Great Britain, and the United States. It is, 
 however, the first step that is always the most costly, and the 
 least productive. Every furnace that is built, and every mine 
 that is opened, tends to promote further progress in the same 
 direction each and every of them tending to promote association 
 and combination. In 1849, not a furnace was to be seen in the 
 neighborhood of Minden, in Westphalia, but "now," says a re- 
 cent traveller, "they stand like towers about the broad plain" 
 making a vast demand for food, clothing, and labor. Of the 80 
 copper-mines of Prussia, no less than 24 have been opened within 
 the last few years. Every mine, every furnace, and every mill, 
 aids in the creation of new roads, and the improvement of old 
 ones -facilitating the opening of new mines, the utilization of the 
 powers of nature, and the development of mind ; and thus in- 
 creasing the value of man, while diminishing that of all the com- 
 modities required for his use. 
 
 The value of cotton and woollen goods exported in 1851, was 
 30,000,000 of thalers = $25,000,000 the chief part of which 
 large sum, consisted of the food that had been combined with the 
 labor, in the process of converting it into cloth. As a consequence
 
 PRESIDENT OF THE UNITED STATES. 147 
 
 of this, the necessity for going abroad to find a market for food 
 had so greatly decreased, that the net export from the country 
 that only thirty years since was the granary of Europe, was but 
 10, 000,000 bushels. 
 
 Look where we may, Mr. President, we meet with evidence of 
 the fact, that the power to maintain a profitable foreign commerce 
 grows with the growth of the domestic market for food, wool, and 
 laborers, and the consequent diminution of the exhausting taxes 
 of trade and transportation. Look, too, where we may, we meet 
 with evidence of the necessity for protection, as the only means 
 by which a great domestic commerce can be created ; and of your 
 own perfect accuracy in regarding that commerce as the thing we 
 really need it being the only sure foundation of an extended 
 intercourse with other countries. Commerce grows with every 
 diminution in the necessity for machinery of transportation as 
 is shown in all the countries which follow in the lead of Colbert, 
 and of France. It declines, with every increase of this necessity, 
 as is shown in Ireland, Portugal, Turkey, the United States, and 
 all others, which follow in the direction indicated by England. 
 
 That commerce may grow, and that nations may acquire that 
 real independence which exhibits itself in the power to maintain 
 direct intercourse with the world, there must be steadiness and 
 regularity of the societary action. Growing always with the 
 growth of domestic commerce, stability is found, in all countries, 
 existing in the direct ratio of the diminution of dependence on 
 foreign trade ; and therefore is it, that France, Belgium, Germany, 
 and Russia, have passed through the recent crisis, almost un- 
 harmed ; while in Britain, and among ourselves the two commu- 
 nities whose policy looks to the sacrifice of domestic commerce at the 
 shrine of trade the societary movement would have been almost 
 at an end, had not the banks of both suspended payment. 
 
 The more you reflect upon these facts, the more, Mr. President, 
 it will, as I think, be obvious to you, that all our difficulties have 
 their origin in excess of centralization, and not of localization ; 
 and that it is to change in the action of the central government, 
 and not to interference with the local ones, we must look for 
 remedy. 
 
 With great respect, 
 
 Your obed't servant, 
 
 HENRY C. CAREY. 
 
 Philadelphia, March Sth, 1858.
 
 LETTERS TO THE 
 
 LETTER TWENTY-SIXTH. 
 
 THE real and permanent interests of all the members of a com- 
 munity, Mr. President, are in perfect harmony with each other 
 each and every man profiting by whatever tends to increase the 
 productive power of his neighbors. So, too, is it with the com- 
 munities themselves each profiting by the increase in the pro- 
 ductive power of each and all. That it may increase, there must 
 be, in each, a growing power of association and combination, re- 
 sulting from increase in the diversity of employments the con- 
 sumer and the producer taking their places by each other's side. 
 To prevent such approximation is the object of the "warfare" 
 waged by the British manufacturer, as described in a former letter ; 
 and hence it is, that discord grows so steadily in all the coun- 
 tries subject to the British system Ireland and India, Turkey 
 and Portugal, Jamaica, and these United States. Seeking evi- 
 dence of the existence of a perfect harmony of international inte- 
 rests, and of the necessity for measures tending to a reduction of 
 the power to carry on that war, we may look to the statistics 
 of the cotton trade for the past few years, to some few figures in 
 regard to which, I desire now, Mr. President, to invite your 
 attention. 
 
 Twenty years since, France consumed 200,000 bales of cotton. 
 She now requires 400,000. Twenty years since, Germany re- 
 quired 100,000. She now requires 400,000. Twenty years 
 since, Sweden took 6000 bales. She now takes 60,000. We 
 have, thus, an increase in three highly protected countries, 
 amounting to 550,000. Adding to this, the additional demand 
 of Belgium and Denmark, Russia, Austria, and Spain, we obtain 
 about 700,000, as the quantity added to the consumption, in the 
 protected countries of Europe. Turning now homeward, we find 
 the addition in our own consumption, in the six years that followed 
 the passage of the protective act of 1842, to have been about 
 300,000 bales; and thus do we obtain, as the total additional 
 consumption of the protected countries, the quantity of a million 
 of bales. 
 
 In four years, ending with 1838, the quantity taken by the mills 
 of Great Britain averaged 1,100,000 bales. In the four, ending 
 with 1854, the average was 1,750,000 the difference having been 
 650,000. In the same period, however, there had been an in- 
 crease in the export of mere yarn, to be woven abroad, amounting 
 to 30,000,000 pounds ; and an increase in the imports from India, 
 to the extent of nearly twice that quantity, as I have reason to 
 believe, although unable to obtain the precise figures. This last 
 constitutes no addition to the supply of the world, there being no 
 reason for believing that more cotton is raised in India now, than
 
 PRESIDENT OF THE UNITED STATES. 149 
 
 was raised there twenty years since. The excess import into 
 England, is a consequence of decline of the domestic manufac- 
 ture, and of the growing necessity, throughout India, for making 
 exchanges among themselves, through the medium of distant 
 lands precisely as the people of Illinois and Mississippi are now 
 compelled to do. The additional yarn being included in the con- 
 sumption of the countries to which it goes, and the additional 
 India cotton giving no increase of supply, the two quantities are 
 to be deducted from the apparent increase of British consumption. 
 That done, we have little more than 400,000 bales, as the growth 
 of consumption outside of the protected countries, against a mil- 
 lion within them. Such being the case, the real interests of the 
 planter would certainly be promoted, by the adoption in Ireland, 
 India, Brazil, Turkey, Portugal, and other unprotected countries, 
 of the system under which the consumption of Central and North- 
 ern Europe has so rapidly and wonderfully increased. 
 
 How is it possible, Mr. President, that these various commu- 
 nities could accomplish the work suggested ? All of them are 
 poor, and so, it will be said, they are likely to remain. So must 
 they do, while they shall continue the work of destroying capital, 
 as they are now doing ; but, so they will not do, whenever they 
 shall begin to establish that circulation of service which consti- 
 tutes society, and economizes labor. Ireland feeds daily more 
 than seven millions of people all of them consumers of capi- 
 tal, while but few of them produce anything to represent the 
 things consumed. More than three-fourths of the mental and 
 physical power of that country goes to waste ; but that waste 
 would cease, so soon as A and B were enabled to exchange ser- 
 vices with C and D ; and they, each and all, were enabled to 
 exchange with others. Estimating the loss as being equivalent 
 to the labor of only two millions of men and women, and the 
 value of the things they might produce, at only half a dollar per 
 day, we obtain a daily amount of a million of dollars; and an 
 annual one of $300,000,000. The effect of this labor in utilizing 
 the coal, the ore, and the thousand other things, now useless, by 
 which those idle millions are surrounded, would be, to add almost 
 as much, yearly, to the value of the land in cultivation ; and 
 here we have an annual amount, far exceeding the total value of 
 the machinery for mining coal and smelting iron ore, and for 
 spinning and weaving cotton, wool, flax, and silk, now in use in 
 England. Turning to India, we see a hundred millions of people, 
 nine-tenths of whose powers are wasted for want of domestic com- 
 merce. Give them that, and capital will at once exist, to an 
 amount far greater than that of the machinery of Britain and 
 France combined. Looking next to Turkey and Portugal, we 
 see millions of people in a situation precisely similar ; and yet, 
 they must all be fed, clothed, lodged, and kept in order for daily 
 work. The daily loss, there, is greater than the annual amount 
 of skill and labor given by England to the conversion of the cot-
 
 150 LETTERS TO THE 
 
 ton and the wool, the iron, the copper, and the tin, they can 
 afford to purchase. Let employments be diversified, and that loss 
 will cease ; and then, capital will be found to exist in vast abun- 
 dance. So is it everywhere. Mexico and Peru would have an 
 abundant supply of capital, were they enabled so to modify their 
 policy as to produce that circulation which is required for se- 
 curing, that, each and every man be enabled to sell his own 
 powers, and to become a competitor for the purchase of those of 
 others. All force results from motion, and it is only because 
 there is no motion in the society of Ireland, India, and Turkey, 
 that those communities continue poor. 
 
 Looking now homewards, Mr. President, we find a waste of 
 capital, in the form of physical and mental power, not exceeded 
 by any country of the world, with the slightest claim to be held 
 as civilized. Farm after farm is cleared, and State after State 
 occupied, to be then in part abandoned, because of the growing 
 necessity for robbing the earth of its soil, to be sold in distant 
 markets. Mills follow mills, and furnaces follow furnaces ruin- 
 ing, in quick succession, all who undertake such works. Em- 
 ployers and workmen spend years in acquiring skill to be then 
 turned adrift, to seek, in the wilds of the West, the food and 
 clothing that the policy of the central government denies to them 
 at home. 
 
 With every step in this direction, the tax of transportation 
 grows the necessity for new roads increasing, as the power to 
 make such roads declines. The proportion of the population 
 engaged in the work of transportation, and in political and tra- 
 ding speculation the class of middlemen that class which lives 
 at the cost of the producers is, therefore, a continually increasing 
 one. Hence, Mr. President, it is, that we so steadily decline in 
 both morals and manners that being the road/rom civilization, 
 and not the one leading towards it. 
 
 Look where we may, we witness a waste of labor, consequent 
 upon the absence of that diversification in the demand for human 
 effort, which is needed for giving us that freedom of domestic 
 commerce, regarded by yourself as being so essential to the crea- 
 tion of an extended intercourse with foreign countries. Millions 
 of human engines are constantly burning the fuel required for the 
 production of the power to labor, and as constantly blowing off 
 the steam that is produced. Look where we may, we see mills 
 and furnaces, mines and roads, scarcely, even when at all, em- 
 ployed all the power they are prepared to furnish, thus going to 
 waste. Why is it wasted ? Because, unable to find a market for 
 his grain, the farmer is forced to store it. Why can he not sell 
 it ? Because the miller, the weaver, the carpenter, the miner, 
 the mason, and the laborer, are unable to sell the force resulting 
 from the consumption of food. 
 
 Look, I pray you, Mr. President, to the extraordinary waste 
 of capital, consequent upon the necessity for using the most perish-
 
 PRESIDENT OF THE UNITED STATES. 151 
 
 able materials in our houses, ships, roads, bridges, and other con- 
 structions, of every kind. This, too, is a growing waste, as is 
 proved by the fact, that the rate of insurance against fire has 
 doubled in the last few years. In countries that are advancing in 
 civilization, security increases, and the rate declines. With us, 
 security steadily diminishes, and the rate increases thus furnish- 
 ing further evidence that our tendencies are from, and not to- 
 wards, civilization. Why is it, that we use so little iron ? Is 
 it because of any deficiency of coal and ore? Certainly not. 
 Why, then, do we not profit by them ? The country abounds in 
 laborers, who would gladly employ themselves in the development 
 of the treasures of the earth, could they obtain food in exchange 
 for labor. Why is it so ? Because the central government leaves 
 the people entrusted to its care, exposed to a "warfare" having 
 for its object, the prevention of the mining of coal, or the making 
 of iron, in any country, except the single one of Britain. Because 
 it holds, that while bound to protect itself, it is under no obliga- 
 tion to protect its constituents. 
 
 Look next, I pray you, Mr. President, to the taxation of our 
 farmers, for the maintenance of the 7, 000,000 tons of shipping, 
 that carries our products to the distant markets, and reflect, 
 that the cost of maintaining this great fleet, is paid by the 
 people who have rude products to sell, and not by those who 
 buy them. The man who must go to market, must pay the cost 
 of going to it, let it take what form it may. The corn and the 
 cotton pay for the maintenance of the ships leaving to the cloth 
 all the profits resulting from their contributions. 
 
 Look further, to the fact, that the loss of shipping, in a single 
 year, by age and accident, is no less than 93,000 tons, as shown 
 in the last Treasury Report. At $40 a ton, we have, here, no 
 less than $37,000,000. Add to this, for the cargoes of these 
 vessels, only a similar amount, and you have $74,000,000 ; all of 
 which falls upon the people who furnish the machinery of trans- 
 portation it being the community whose products are most bulky, 
 that pays the cost of going to, and returning from, the market. 
 
 Throughout the Union, Mr. President, there is a waste of power 
 unparalleled in the world. That power is capital. At how much 
 might it be valued, were it fully applied? At more than the 
 whole of our present product the quantity wasted being greatly 
 more than that employed. Our present production has been 
 estimated at $3,500,000,000 a year being nearly $10,000,000 
 a day. Estimating the daily waste at no more than that sum, 
 we should have for the weekly one, a sum equal to the capital 
 that has been required for the creation of all the cotton-mills of 
 England. Why do we not economize this capital, and let it ap- 
 pear in the form of mill's ? Why do we not bring the spindle to 
 the plantation ? Why do we not make a market at the mines 
 and furnaces, for the produce of the farm ? Because the central 
 government refuses to permit the people to make the effort, once
 
 152 LETTERS TO THE 
 
 for all, to free themselves from the tax of transportation. Be- 
 cause, in opposition to the views so well expressed by yourself, 
 your immediate predecessors have held, that it was better for each 
 man to go daily to the spring in search of water, than that all the 
 men should unite in the effort to construct an aqueduct, by means 
 of which the water should be enabled to come daily to their doors. 
 That, Mr. President, is precisely what we are doing each man 
 sending his little products to the distant market, at daily cost for 
 transportation, when only the slightest effort would be required 
 for bringing the market to their land, and thus annihilating, at 
 once and for ever, the tax of transportation. 
 
 In all countries, capital accumulates in the precise ratio of the 
 economy of human power. That it may be economized, there 
 must be differences in society, resulting from the development of 
 the various faculties of men. The commercial policy of France 
 tends in that direction, and therefore does she grow rich ; while, 
 for want of that policy, Turkey and Portugal, Ireland and India, 
 and our Union, decline from day to day doing this for the plain 
 and simple reason, that in each and every of them there is an en- 
 forced waste of capital, amounting, weekly, to more than the 
 annual value of the foreign manufactures they consume. Let them 
 be emancipated from the dominion of trade let them have com- 
 merce at home and they will soon have more to sell, and will be 
 enabled to buy far more than they now do becoming larger cus- 
 tomers to the producers of cotton and sugar on the one hand, and 
 to the makers of silks and ribbons on the other ; and adding, too, 
 to the market of these latter, by increasing the demand for the 
 products of the former. 
 
 The farmers of the world, Mr. President, are natural allies, as 
 against the trader he seeking to have their products at low 
 prices, and they desiring to sell at high ones. In the natural 
 order of things, then, the agricultural nations should be found 
 united in their resistance to a warfare against themselves, having 
 for its object, the cheapening of their products. In Europe, they 
 are so found all the advancing countries having adopted mea- 
 sures of protection. As a consequence, their demands upon our 
 planters are steadily increasing ; and yet, strangely enough, our 
 planting interest is the steady opponent of protection, here and 
 everywhere ! Constantly profiting, as they do, by the increased 
 demands of France and Germany, they appear before the world 
 as advocates of the system, under which the Irish and Portuguese 
 demand for cotton, has almost disappeared. Hence it is, that, 
 instead of placing ourselves, as we might do, in the lead of the 
 world, we are rapidly declining towards that condition of colonial 
 dependence, from which we were rescued, by the war of 17 7 6. 
 With great respect, 
 
 Your obed't servant, 
 
 HENRY C. CAREY. 
 
 Philadelphia, March IQih, 1858.
 
 PRESIDENT OF THE UNITED STATES. 153 
 
 LETTER TWENTY-SEVENTH. 
 
 THE first of all the taxes to be paid by land and labor being 
 that of transportation, it follows, Mr. President, that it takes pre- 
 cedence of contributions required for the maintenance of the State. 
 All that Iowa can claim of her citizens, is a share of the few 
 cents there received for a bushel of corn, and not a share of the 
 many cents paid for it in Manchester. 
 
 The tax of transportation diminishing with every increase in 
 the power of combination, consequent upon increase in the diver- 
 sity of employments, it follows, necessarily, that the power of 
 the State grows with the growth of the power of combination 
 among its people. The farmer close to New York, who sells his 
 corn at a dollar a bushel, is more able to contribute to the sup- 
 port of government, than his competitor of Iowa, who gives four, 
 five, or six bushels, for a similar quantity of money. 
 
 The greater the diversity of employments, the more is the ten- 
 dency towards development of the various powers of the earth, 
 and towards the creation of manufacturing and mining towns and 
 villages each constituting a local centre of attraction, capable 
 of counteracting the centralizing tendencies of the State at large. 
 
 That these propositions are true, cannot, Mr. President, be 
 questioned. Being so, the general laws deducible from them 
 would seem to be as follows : The more numerous the demands 
 for human faculty, and the greater their variety, the greater is 
 the power of combination among men the more productive must 
 be their labor the greater must be the tendency towards the 
 creation and extension of local institutions and the greater must 
 be the power of the State of which they are a part. 
 
 Such being the law, it follows, necessarily, that the less the 
 variety in the demand for human powers, the greater must be the 
 tendency towards exhaustion of the soil, and dispersion of its 
 people every step in that direction being accompanied by dimi- 
 nution of local power, and growing weakness of the State. 
 
 That such is the law, we have proof in the enormous revenue 
 of England of the present, as compared with the England of the 
 Plantagenets ; and in those of France, and all the countries that 
 follow in the lead of Colbert, as compared with Ireland, India, 
 Portugal, Turkey, and all other countries that follow in the direc- 
 tion now indicated by the economists of England. 
 
 How, Mr. President, is it with ourselves ? The answer to this 
 question would seem to be found in the single statement, that em- 
 ployments become less diversified from year to year. With each 
 successive year, for ten years past, our people have been more
 
 154 LETTERS TO THE 
 
 and more compelled to make their election between the work of 
 robbing the soil, on the one hand, and plundering their fellow 
 men, on the other the proportion borne by traders and trans- 
 porters, speculators and peculators, lawyers and politicians, office- 
 hunters and office-holders, and middlemen of all descriptions, 
 to the whole mass of society, having been a constantly increasing 
 one. Great as, in those years, has been the tendency in that direc- 
 tion, it has increased tenfold, in the brief period in which you have 
 occupied the presidential chair mills, furnaces, mines, and ma- 
 chine shops having, everywhere, been closed, and hundreds of 
 thousands of people having been reduced to choose between 
 crime, on the one hand, and destitution, if not even death, on the 
 other. 
 
 Such, Mr. President, being the state of things among the peo- 
 ple, what should it be, in the relation of the people to the State ? 
 If increasing diversity of employments among the one, gives 
 strength for the maintenance of the other, should not decline in 
 that diversity be attended with growing weakness in the State ? 
 Assuredly it should, and that it really is so, we shall obtain abun- 
 dant evidence, turn to what portion of the Union we may. 
 
 Looking first to New England, we witness an emigration of the 
 most remarkable kind each and every stage thereof being accom- 
 panied by consolidation of the land, diminution of cultivation, 
 and decline of power to maintain schools, churches, roads, and go- 
 vernment. From one quarter, we hear that it has become "evi- 
 dent that the number of families in quite a number of our agri- 
 cultural towns is growing less. The old homesteads," as we are 
 further told, "become the property of the adjacent husbandman, 
 or go to ruin under the proprietorship of some far-off owner." 
 From another, we learn, that "many of the churches are reduced 
 to the last extremity," and that, "but for the missionary society; 
 by which not a few of them are supplied, would yield at once to 
 utter discouragement." Such being the general tendency through- 
 out New England, the "wonder is not, that so many Eastern 
 churches are drooping, but that they have so long borne up 
 against the constant and copious depletion of their vigor and 
 their piety. ' ' 
 
 Turning now to New York, we find a State in which the average 
 yield of wheat, has fallen to little more than a dozen bushels 
 one, in which the diminution of the rural population, and the con- 
 solidation of the land, become more rapid with each successive 
 year. Taking next, the Western portion of the State, one of the 
 finest wheat-growing countries of the world, so recently a wilder- 
 ness, we find its farmers already engaged in discussing the neces- 
 sity of abandoning the wheat culture, as the only means of freeing 
 themselves from the ravages of insects, provided by the Creator 
 for the removal of diseased and decaying vegetable matter. Com- 
 pelled to the exhaustion of their soil, and unable to vary their
 
 PRESIDENT OF THE UNITED STATES. 155 
 
 cultivation, their plants become weaker from year to year, and 
 more and more fitted to become the prey of the fly, and other 
 enemies. As a consequence of this it is, that emigration steadily 
 increases, and that the power to maintain the local institutions as 
 steadily declines. 
 
 The young Ohio, now but little more than half a century old, 
 has already become, and for similar reasons, the great emigrating 
 State of the Union the diminution in the yield of her land, 
 having kept equal pace with augmentation of the pressure of 
 taxation for local purposes. Passing thence, to the yet younger 
 Indiana, we find the same great fact local institutions that had 
 been self-supporting, having been compelled to look abroad for 
 the means of continuing their existence. 
 
 Turning now South, we see, in Virginia, a .community occu- 
 pying a land, that has been blessed by nature to an extent not 
 exceeded in the world, and yet her government finds itself com- 
 pelled to tax tradesmen and tavern-keepers, attorneys and den- 
 tists, clocks, harps, pianos, carriages, slaves, and numerous other 
 commodities and things, for the purpose of obtaining the means 
 required for its support. Quite recently, it has been proposed 
 to lay an export duty upon oysters, as a means of maintaining the 
 declining credit of the State ! Having torn out and sold her 
 soil, she has little now to sell, but slaves ; and, as a necessary 
 consequence, the burthen of the local institutions becomes greater 
 from year to year. How it is with South Carolina, you have 
 seen, Mr. President, in an extract from a Report made to the 
 Agricultural Society of that State, given in a former letter.* 
 Georgia has almost ceased to increase in population, although 
 her territory, properly cultivated, would support half the people 
 of the Union. Alabama, a State that, but forty years since, was 
 almost entirely unoccupied, is following rapidly in the train of 
 Carolina and Georgia the yield of her soil decreasing land 
 becoming consolidated and the power of extending, or even 
 maintaining, churches, schools, or State, declining with each 
 successive year. 
 
 The policy of the central government, Mr. President, tends to 
 the subjection of the farmer, and the planter, to the trader, and 
 to the building up of great cities, to be supported at the cost of 
 those who produce corn and cotton, and need to consume cloth 
 and iron. Look, I pray you, to the fact, that the city govern- 
 ment of New York alone, expends, this year, more than $8,000,000. 
 Who are the payers of these millions ? The trader ? The specu- 
 lator ? The property-holder ? The ship-owner ? It is none of 
 these all of them exercising the power to tax the unfortunate 
 producers who find themselves compelled to depend upon distant 
 markets, and to accept a single yard of cloth in exchange for the 
 
 * See note to Letter XXII.
 
 156 LETTERS TO THE 
 
 corn that commands, in Manchester, ten or a dozen yards. The 
 man who must go to market, must pay the cost of getting there, 
 let it take what form it may; and among the items of cost, that of 
 maintaining the traders, brokers, and speculators, of a city like 
 New York, stands forth most conspicuously. The necessity for 
 going to a single and distant market, increases with every year 
 every step in that direction being attended by an augmentation 
 of the power of the trader and transporter, accompanied by de- 
 cline in the powers of the land, and in the prices of its products. 
 These, Mr. President, being evidences of declining civilization, 
 we need be at little loss to account for the fact, that it has been 
 here declared, that "free society has proved a failure," and that 
 bondage is the natural condition of the laboring-man, be he white 
 or black. 
 
 How is it, with our central government the only one, claim- 
 ing to be regarded as civilized, by which it is held, that the duties 
 of government are limited to the protection of itself, and the com- 
 pensation of its members and its servants leaving wholly out of 
 view the protection of the people, for the promotion of whose in- 
 terests it was established ? Do its demands upon the people 
 diminish with the decline in the powers of the laud, and in the 
 prices of its products ? Does the farmer who takes 12 bushels 
 where his predecessor had obtained 24, pay less to the support 
 of the Federal government ? Docs the flour which now sells for 
 $4, contribute less to the support of Federal officers, than that 
 which, forty years since, was sold at $10 ? Does the cotton which 
 sells at 8 cents, contribute less for the support of ships of war, 
 than that which sold, in 1816, at 25 ? Is the tobacco which com- 
 mands $50 or $60, less taxed for the payment of senators and 
 representatives, than that which sold, forty years since, for $100 
 or $120 ? Let us, Mr. President, inquire. 
 
 In the half century which followed the close of the war of 1783, 
 the highest expenditure of the Federal government, in time of 
 peace, was $14,000,000 ; and even that amount had been reached 
 only in the first term of General Jackson's administration 
 the average expenditure of his immediate predecessor, Mr. Adams, 
 having been only $12,500,000, while that of Mr. Monroe's two 
 terms, had been $13,000,000. 
 
 The average contribution, in the times of Messrs. Adams and 
 Monroe, may be taken at about $1.70 per head. In General 
 Jackson's first term, it was less the population of 1830 having 
 been nearly 13,000,000, and the amount of contribution only 
 $14,000,000 ; or little more than a dollar per head. The reduc- 
 tion thus exhibited, was evidence of growing strength of the local 
 powers proving advance in civilization. 
 
 Five-and-twenty years have since elapsed, during the whole of 
 which time, as you, Mr. President, have seen, the central govern- 
 ment has been engaged in almost ceaseless efforts to extend its
 
 PRESIDENT OF THE UNITED STATES. 157 
 
 powers, at the cost of the local authorities. Daring nearly all 
 that period, its policy has tended to diminish the number of em- 
 ployments open to our people to lessen the power of combina- 
 tion for any useful purpose to increase the cost of transporta- 
 tion to make the farmer and planter more dependent on the 
 distant market and thus to re-introduce the colonial system, so 
 well described by Mr. Gee, from which we were emancipated by the 
 war of 1776. The result is seen in the facts, that, while the popu- 
 lation has increased but about 130 per cent., the expenditure has 
 quintupled in amount, and more than doubled in its ratio to the 
 number of persons by whom the contributions were paid. 
 
 Why is this so ? Because, in opposition to the practice of the 
 enlightened and civilized countries of the world, it is held by our 
 central government, that the larger the space occupied by any 
 given number of people, and the less, consequently, the power of 
 association and combination, the greater must be the power of 
 the state. Always on the watch for the acquisition of land, 
 however poor, we have gone on, adding Florida to Lousiana, 
 Texas to Florida, California to Texas, and New Mexico to Cali- 
 fornia ; and now hold ourselves ready, at almost any cost of 
 honor, or of treasure, to become proprietors of Cuba, or Sonora. 
 With every step in that direction, there arises a necessity for in- 
 crease of fleets and armies, and increase in the number of public 
 officers with corresponding decrease iu the power of the people 
 to provide the means required for their support. In all advancing 
 countries of the world, the proportion of the proceeds of labor 
 required for the purposes of government, is a decreasing one. In 
 all declining countries, it is an increasing one. With us, it steadily 
 increases the amount demanded, per head, being now twice as 
 great as it was, when the selling prices of our raw products were 
 more than twice as high as they are now. 
 
 That the progress of men, whether towards centralization or 
 localization, slavery or freedom, barbarism or civilization, is one 
 of constant acceleration, is a truth, the evidence of which is found 
 in every page of history ; but nowhere, Mr. President, can stronger 
 proof be found, than in the records of our Treasury. Fifteen 
 years since, under the administration of Mr. Tyler, the expenditure 
 of the Federal government was $23,500,000. It is now $70,000,000, 
 and there is every reason to believe, that before the end of your 
 administration it will reach $100,000,000 the necessity for ships 
 of war, and soldiers, increasing with the decline in value of all 
 the commodities we have to sell. Five years since, the expendi- 
 tures of New York city were under $3,000,000. They are now 
 $8,500,000 ; and there is every reason to believe, that before the 
 close of another decade, they will have largely grown the power 
 ty) tax the farmers and planters of the country, growing with every 
 step in the progress towards reduction of the population to de-
 
 158 LETTERS TO THE 
 
 pendence on the sale of the soil, in the form of wheat and cotton, 
 for the means of present support. 
 
 For half a century, during which the Federal government was 
 administered by Washington and his successors, down to Jack- 
 son, the general tendency of its action was towards carrying into 
 practical effect the Declaration of our Independence. During 
 nearly all that time, there was a general tendency towards increase 
 in the diversity of employments, with constant increase in the 
 power of association, in the strength of local action, and in the 
 steadiness of the currency no general suspension, in time of 
 peace, having occurred in all that time. In the period that has 
 since elapsed, the policy of the revolution has been abandoned, 
 with constant increase in the dependence of the planter and farmer 
 upon the distant trader. The power of local action, therefore, 
 steadily declines, with constant diminution in the respect of the 
 central government for local rights, and growing instability of the 
 currency the suspensions of payment, in that brief period, having 
 been no less than three in number. 
 
 In the half century from Washington to Jackson the policy 
 of the country having been that of peace, and of the extension of 
 that domestic commerce you have so well described the Federal 
 government was economically administered, and the power to con- 
 tribute to its support was a steadily augmenting one. Since then 
 the policy having become that of free trade, annexation, and 
 war the expenses of the central government have greatly in- 
 creased, while the power to contribute to its support, or to that 
 of local institutions, has tended to diminish. In the first, Mr. 
 President, all the phenomena we meet are those of an advancing 
 civilization. In the other, they are those of a declining one. 
 How far the one, or the other, has tended to the production of 
 strength in the State, I propose to examine in another letter 
 remaining meanwhile, 
 
 With great respect, 
 
 Your obed't servant, 
 
 HENRY C. CAREY. 
 Philadelphia, March I2th, 1858.
 
 PRESIDENT OF THE UNITED STATES. 159 
 
 LETTER TWENTY-EIGHTH. 
 
 STEADINESS and regularity of movement, in machinery of any 
 kind, is necessary to the maintenance of motion, and the develop- 
 ment of power. A steam-engine subjected to sudden and repeated 
 shocks, could have but a brief existence. So, too, Mr. President, 
 is it with individuals and societies regularity of action being 
 indispensable to the development of their powers, to durability, 
 and to increase of their influence on the movements of the world 
 at large. How far such regularity has been attained among our- 
 selves, and how far our various systems of policy have tended to 
 augment, or lessen, the ability to control our own movements, and 
 to influence the action of the world, it is proposed now to show. 
 
 Peace was restored to the world in 1815. We had passed, 
 almost unharmed, through a war with Great Britain, and had 
 come out of it rich and strong. The tariff being a highly protec- 
 tive one, the customs-revenue was large exceeding $36,000,000. 
 One year later, the system was changed all the changes being 
 in the direction of present, or ultimate, abandonment of the idea 
 of protecting the farmer in his efforts to bring the consumer to 
 his side, and thus relieve himself from the wasting tax of trans- 
 portation. Factories and furnaces being, therefore, closed, 
 mechanics and laborers were compelled to seek the West, and 
 sales of public land rapidly increased. Large receipts from both 
 land and customs gave us, of course, a prosperous treasury the 
 total receipts of 1819 having been $24,000,000; collected, too, 
 at a time when, as now, the number of unemployed workmen in 
 each of our principal cities, counted by tens of thousands. 
 Suddenly, however, the scene changed poverty of the people 
 producing inability to continue the payment of contributions to the 
 public treasury. The total revenue fell, in 1821, to $14,000,000, 
 or little more than a third of what it had been, but five years pre- 
 viously ; and the Treasury, but recently so rich, was reduced to the 
 necessity of resorting to loans ; and that, too, in a time of pro- 
 found peace ! Such, Mr. President, was the result, so far as the 
 Treasury was concerned, of the first free-trade experiment. 
 
 The year 1828 having given us a really protective tariff, the 
 following were the receipts of the Treasury, in the brief period of 
 its existence : 
 
 Customs. Land. Total. 
 
 1829 $22,681,000 , $1,517,000 $21,198,000 
 
 1830 21,922,000 2,329,000 24,251,000 
 
 1831 24,224,000 3,210,000 27,434,000 
 
 1832 28,465,000 2,623,000 31,088,000 
 
 1833 29,033,000 8,967,000' 83,000,000
 
 160 LETTERS TO THE 
 
 Here, Mr. President, we have a steadiness, and regularity of 
 movement, worthy of all admiration each successive year gain- 
 ing: slightly upon its predecessor, and enabling the Treasury to 
 command the respect and confidence of the world by the gradual 
 discharge of debts contracted in time of war, and in the dis- 
 astrous free-trade period, which had so closely followed the return 
 of peace. 
 
 The Compromise Act of 1833 repudiated the idea of protec- 
 tion the point provided to be reached by it, in 1842, having 
 l>een that of a strictly revenue tariff, with a rate of duty limited to 
 20 per cent. As before, land sales became large, and the total 
 revenue of 1836 exceeded $48,000,000. As before, however, the 
 apparent prosperity was followed by real adversity the total 
 receipts of the following years having been as follows : 
 
 1837 $18,000,000 1839 $30,000,000 
 
 1838 19,000,000 1840 16,000,000 
 
 The instability and irregularity exhibited in the period from 
 1817 to 1822, are here, Mr. President, reproduced the revenue 
 mounting to 48, and then falling to 18 millions then, again, 
 going up to 30, to fall to 16; and all this, too, in the short period 
 of five years 1 Need we be surprised at seeing that, under such a 
 course of action, the machine was shattered ? Is it wonderful, 
 that the Treasury so entirely lost the confidence of those who had 
 money to lend, as to have failed in all its efforts to negotiate a 
 loan, either abroad or at home, and to have been compelled to 
 resort to the use of irredeemable paper, as affording the only 
 means at its command, for maintaining the government in exist- 
 ence ? To all intents and purposes, it was bankrupt such hav- 
 ing been the result of the second free-trade experiment. 
 
 The bankruptcy of the Treasury having produced another change 
 of policy, and protection having been re-adopted, we find a resto- 
 ration of order and regularity in the financial movement, as is 
 shown in the following figures : 
 
 Customs. Land. Total. 
 
 1843-4 $26,183,000 $2,059,000 $28,242,000 
 
 1844-5 27,528,000 2,077,900 / 29,605,000 
 
 1845-6 26,712,000 2,699,090 29,406,000 
 
 1846-7 23,747,000 3,328,000 27,075,000 
 
 The ^policy being once more changed, and the free -trade 
 policy re-adopted, we find a repetition of the irregularity ob- 
 served in both of the former free-trade periods the total revenue 
 having varied between 30 and 72 millions, and having fallen to a 
 point so low, as to compel the government, one year since so rich, 
 to solicit purchasers for the irredeemable paper, to the use of 
 which it has now been driven. In the absence of demand for its 
 commodity, it has been compelled to forfeit its engagements for 
 the payment of money thus committing what, in the case of iudi-
 
 PRESIDENT OF THE UNITED STATES. 161 
 
 viduals, would be held to be acts of bankruptcy. Such is the 
 point, Mr. President, at which we have now arrived, in the third 
 experiment of a policy based upon the idea that governments are 
 instituted for the purpose of protecting themselves, and not the 
 people for whose use they have been created. 
 
 What, Mr. President, are the prospects of the Treasury for the 
 remaining years of this experiment ? That we may be enabled to 
 answer this question, we must first inquire into the prospects of 
 the farmers and planters the power to contribute to the public 
 revenue, being wholly dependent upon the prices obtainable for 
 the masses of raw produce, that the policy of the central govern- 
 ment compels us to throw upon foreign markets. 
 
 To enable us to predict the future, it is required, that we study 
 the past. Doing this, we find, that each successive crisis has 
 established a lower standard of prices for all our products flour 
 having declined steadily, until from $14, in 1816, it had, at the 
 opening of the Crimean war, reached the point of $4.24; and 
 cotton having declined from 25 cents, in 1816, to little more than 
 6, in the period that followed the crash of 1842. As regards the 
 first, we have already evidence of the existence of a state of things 
 nearly correspondent with that of 1852; and yet, the hundreds 
 of thousands of farms that have recently been created, throughout 
 the West, have scarcely begun to supply the market. Let them 
 begin, and let the seasons be propitious, and the prices of their 
 products are likely to find a point lower than has ever yet been 
 touched. As regards the second, we have, already, the following 
 facts : first, the average export-price from 1852 to 1856, was only 
 9 cents having been lower than that of any free-trade period we 
 ever yet have known ; second, the present price, with a crop no 
 larger than that of 1849, is nearly as low as that average ; and, 
 third, the power to produce cotton, with fair seasons, is now fully 
 equal to a crop of 4,000,000 bales; or more, by 1,200,000, than 
 the one that is now in market. Let that power be exercised, as 
 we see it to have been, in the years that followed the last great 
 crash, and we shall probably obtain a further confirmation of the 
 general principle, that each successive financial crisis, conse- 
 quent upon the adoption of the policy recommended by Brit- 
 ish economists and manufacturers, establishes an average price, 
 lower than that which had preceded it. That proving to be 
 the case, as now appears very probable, it would seem quite 
 clear, that our power to pay for foreign commodities, with the 
 proceeds of either food or cotton, must be very small indeed. 
 As regards the existence of any such power, resulting from the 
 exports of manufactures, it is needed only that we remark the 
 facts, that most of our mills are closed that the proprietors are 
 ruined and that, there is little probability of their soon being 
 opened. Gold travelling, as it always does, in company with 
 other raw materials we shall, of course, export ; provided we can 
 11
 
 162 LETTERS TO THE 
 
 find the means to purchase it from Californian owners. Against 
 that, however, there is a demand, for the payment of interest on 
 debts contracted in the two free-trade periods, amounting to little 
 less than $30,000,000 constituting the first mortgage on our 
 exports. 
 
 Our credit having disappeared, we can obtain no more goods 
 than we can pay for, and that is little likely to equal $200,000,000, 
 even if it exceed the $180,000,000 of 1850, when the customs 
 revenue was $46,000,000. Since then, however, all duties having 
 been reduced, while the free list has been much enlarged, the same 
 amount of imports would, now, yield little more than $28,000,000.* 
 Add to this a land revenue of $2,000,000, and we obtain a total 
 of $30,000,000, as the probable receipts of a government, whoso 
 expenditures have already reached $70,000,000; and whose ten- 
 dencies in the direction of increased expenditure are so very 
 great, as to warrant the assumption, that they will speedily reach 
 $100,000,000. 
 
 These estimates of the amount of imports, and of revenue, differ 
 widely, Mr. President, from those of the Secretary of the Treasury, 
 who tells us, that "looking to our probable exports, the great 
 resources of our country, its unexampled prosperity in many 
 branches of industry, its capacity to recover from temporary pres- 
 sure in its trade and business, the opinion is expressed, with some 
 confidence, that the reduction from this cause will not exceed 
 twenty-five per centum;" and, that the customs-revenue upon 
 which we may securely calculate, wUl be $69,500,000. 
 
 He who would predict the future, should be able to show that 
 he had been able to anticipate the past. This, the honorable 
 Secretary does not undertake to do. On the contrary, he admits, 
 that the crisis had been "unforeseen;" and all his acts, as legis- 
 lator, and as executive officer, from the opening of the session of 
 1856-7, prove that he did not, in the slightest degree, anticipate 
 the recent changes. Had he done so, he would, certainly, have 
 opposed the passage of the tariff act of 1857. Had he done so, 
 he would not, so recently as September last, have purchased at a 
 large advance, certificates of public debt, the payment for which 
 so completely exhausted the funds at his command, as to render 
 it necessary to withdraw from the Mint, all the funds appropri- 
 ated to its use. Neither would he have had to call upou Con- 
 gress to give its instant attention to the work of authorizing an 
 issue of irredeemable paper, as the only means of keeping the 
 government afloat. All the facts tending, thus, to prove, that 
 the Secretary could not, in the spring and summer of 1857, predict 
 
 * The Secretary of the Treasury estimates the reduction of rates, effected 
 by the recent tariff law, at 25 per cent. Adding to this the quantity of 
 goods now freed from the payment of any duty whatsoever, we shall obtain 
 a reduction of, more than a third.
 
 PRESIDENT OF THE UNITED STATES. 163 
 
 the occurrences of the the autumn and winter that were to fol- 
 low, I beg, Mr. President, to ask desiring, at the same time, 
 to disclaim the slightest feeling of disrespect for your Cabinet 
 Minister what reason have we for believing, that the predictions 
 of December, '57, are to be realized In '58, '59, or '60 ? There 
 is, as it appears to me, none whatever. They cannot be realized. 
 The crisis of '57 ought not to have been "unforeseen" its ap- 
 proach having been heralded by the same phenomena, that had 
 been observed in 1836. It was not "unforeseen" by those who 
 had taken the trouble to study these phenomena, and to satisfy 
 themselves, that like causes always produce like effects. Not only 
 was it foreseen, but its arrival was publicly predicted ; and in a 
 manner, too, that should have induced such a study of the facts, 
 on the part of a finance minister, as would have resulted in satis- 
 fying himself that the prediction could not fail, and that, too, 
 speedily, to form a chapter in our financial history. 
 
 There being, at present, no reason for believing that our power 
 to pay for foreign merchandize will be greater than it was some 
 years since, and our credit having wholly disappeared, there is no 
 warrant for supposing that the revenue, for the next three years, 
 can exceed $100,000,000 ; but, there is abundant cause for the 
 belief, that the expenditures of those years will exceed $250,000,000. 
 Under such circumstances, there would seem little reason for 
 doubting that the scenes of 1842 exhibiting a total failure of 
 confidence in the ability of the Treasury to meet its engagements, 
 accompanied by an almost exclusive dependence upon the use of 
 irredeemable government paper are likely soon to be repeated. 
 How long, Mr. President, can such a system be maintained ? 
 How long can the government continue to expend eighty millions, 
 while collecting only thirty ? Is it not clear, that the road we 
 are now travelling must end in bankruptcy the most complete ? 
 Will not the conviction that such must inevitably be the case, 
 force itself upon the money-lenders of Europe, as well as upon 
 our own ? 
 
 We are, however, assured by you, that, the national credit 
 being high, loans can be effected on "advantageous terms." To 
 me, the reverse of this would seem to be the case the rate of 
 interest paid by our Treasury being higher than that paid by any 
 other community, claiming to be in possession of a regularly or- 
 ganized and stable government. That rate is the true index to 
 the confidence existing the man of sober, industrious, and regu- 
 lar habits, always obtaining the use of money at rates far lower 
 than those paid by gamblers and speculators, whose treasuriea at 
 one moment are overflowing, while at the next, they find them- 
 selves in the usurer's hands. Judging from the fact, that the tri- 
 vial amount of money which constitutes our present debt, was 
 obtained only on the condition of paying interest at the rate of 
 six per cent., our credit cannot be regarded as being very good.
 
 164 LETTERS TO THE 
 
 Should it be so, in face of the fact, that we are now again, and 
 in a time of profound peace, compelled to resort to loans ? 
 
 We pay higher interest than any community in the world, claiming 
 to be held as civilized ; and this we do, in common with all the 
 countries that follow in the direction indicated by England ex- 
 porting rude products, and taking pay therefor, in trivial quanti- 
 ties of the same, returned in the form of finished commodities. 
 Contrast, I pray you, Mr. President, our financial movements 
 with those of France, and of all the countries that have followed 
 her, in adopting the policy indicated by Colbert. Less than six- 
 teen years since, the representatives of our Treasury were seen, 
 and that, too, in a time of profound peace, knocking at the doors 
 of all the bankers of Europe seeking, in vain, to borrow a single 
 dollar. Now, again, in time of peace, we find ourselves com- 
 pelled to create a debt, the amount of which is likely, before the 
 close of your administration, to exceed a hundred millions ; pro- 
 vided, always, that it should prove possible to borrow that 
 amount. France and Russia, on the contrary, have just passed 
 through a war that has required enormous sacrifices of both men 
 and money ; and yet, neither the one, nor the other, has had 
 occasion to go beyond its own territory to obtain the supplies 
 it needed. Shut out, by order of the Allied Powers, from all 
 the principal money-marts of Europe, Russia maintained her 
 credit so perfectly, that her five per cent, stocks never, even for a 
 single moment, fell below the par. 
 
 How would it be with us, Mr. President, in case of war, 
 cut off, as we should be, from all our accustomed sources 
 for revenue ; with our ports blockaded, and our customs officers 
 unemployed ; with no demand for the rude products of the soil, 
 and no demand for land ; with a frontier accessible to the enemy, 
 almost twice as great as it was, before the government entered 
 upon its career of centralization, now five-and-twenty years since ? 
 Could we maintain our stocks at par ? Certainly not ! Abun- 
 dant evidence would then be furnished of the accuracy of Johnson, 
 when he declared that "extended empire, like extended gold, ex- 
 changed solid strength for feeble splendor." Never, at any 
 period of our national existence, has the central government been 
 so entirely incapable, as now, of guaranteeing to the people of the 
 various States, of the Atlantic and the Pacific, the secure enjoy- 
 ment of the rights of person and property ; and yet, the expen- 
 ditures of that government are five times greater than they were, 
 when it first undertook to supersede the local authorities in the 
 management of the currency. 
 
 France, Germany, Sweden, and Russia, and all other countries 
 that have adopted the protective policy, grow daily stronger, 
 while we grow daily weaker. Why is it so ? Because, Mr. 
 President, they appreciate the facts, that the first of all taxes is 
 that paid to the trader and the transporter ; that those taxes
 
 PRESIDENT OF THE UNITED STATES. 165 
 
 take, therefore, precedence of the demands of government ; and 
 that the power of the latter to obtain revenue grows as the tax 
 of transportation declines, and declines as that tax grows. Oar 
 government, on the contrary, closes its eyes to the existence of 
 those facts. 
 
 Consequent upon this, it is, that those governments seek to 
 promote the power of combination, while ours is incessantly la- 
 boring to destroy it ; that the one seeks to give value to land, by 
 facilitating the transfer of its products, while the other rejoices 
 in the abandonment of land, and the emigration of its people ; 
 that the one seeks to create demand for all the powers of man, 
 while the other limits the demand to that brute faculty required 
 for the rudest cultivation on the one hand, and trade on the 
 other; that the one would create a rich agriculture, while the 
 other limits the business of its farmers and planters to the work 
 of tearing out and selling the soil, and thus robbing the great 
 treasury of nature ; and, that the one seeks to supersede the trader 
 and transporter in the government of its people, while the other 
 labors to enable the trader and transporter to supersede itself. 
 
 The strength of all communities, Mr. President, increases in 
 the ratio of the approximation of the prices of rude produce and 
 finished products, In France, Germany, Russia, and throughout 
 Northern and Central Europe, that approximation becomes, from 
 year to year, more close ; and therefore is it, that serfdom is gra- 
 dually disappearing, and that those communities grow in strength, 
 wealth and power. In Turkey, Portugal, India, and Mexico, 
 those prices are steadily receding, and hence it is, that they all 
 decline in wealth and strength that so little confidence is felt in 
 their future that men become less free, from year to year and 
 that they find it necessary to pay so large an interest, when they 
 need to borrow money. So, too, is it with ourselves, and hence 
 it is, that our Treasury pays always so high a rate of interest ; 
 and, that among those by whom it has been directed, the belief in 
 the necessity of man's enslavement has been a constantly growing 
 one. Russia emancipates her serfs, at the moment when we are 
 agitating the re-opening of the African slave trade ! 
 
 The more the subject is studied, the more, as I think, must it 
 become apparent to you, that what we need is, not a reduction 
 of the local powers, but such a reformation of the action of the 
 central power, as shall make it harmonize with the ideas of your 
 most distinguished predecessors. 
 With great respect, 
 
 Your obed't servant, 
 
 HKNBT C. CARKT. 
 
 Philadelphia, March Ibth, 1858.
 
 166 LETTERS TO THE 
 
 LETTER TWENTY-NINTH. 
 
 (CONCLUSION.) 
 
 OUR public warehouses, Mr. President, are filled with foreign 
 merchandise, always ready to supply the material of auction sales. 
 Our auctioneers are constantly at work, supplying the wholesale 
 and retail dealers, at- prices fixed by themselves. Our shops are 
 gorged so thoroughly, with foreign food and labor in every form, 
 from the coarsest woollens to the finest silks, as to leave no place 
 for the domestic food and labor that seek a market. Such is the 
 mode of "warfare," by means of which "the most wealthy capi- 
 talists" of Britain "are enabled to overwhelm all foreign compe- 
 tition in times of great depression, and thus to clear the way for 
 the whole trade to step in, when prices revive, and to carry on 
 a great business, before foreign capital can again accumulate to 
 such an extent, as to be able to establish a competition in prices 
 with any chance of success." Such, Mr. President, is the sort 
 of warfare, by means of which Ireland and India have been ruined, 
 without the necessity for firing a gun, or drawing a sword. Such 
 is the warfare against which your fellow-citizens, for ten years 
 past, have sought, but vainly sought, to be protected the only 
 answer to their petitions having been, that the duties of the govern- 
 ment were limited to the task of protecting itself, leaving the peo- 
 ple to protect themselves as they could. 
 
 As a consequence of this it is : that after a growth of pauper- 
 ism, steadily continued during the last ten years, we find it sud- 
 denly so much expanded, that hundreds of thousands of our peo- 
 ple are wholly unable to sell their labor, or to purchase food and 
 clothing : 
 
 That factories, mills, mines, and furnaces, the cost of which has 
 counted by hundreds of millions of dollars, are now closed, and 
 likely so to remain : 
 
 That the power to diversify the employments of society declines 
 from day to day : 
 
 That, simultaneously therewith, we add to our population a 
 million of persons annually : 
 
 That, the necessity for resorting to the labors of the field, as 
 affording the only means of support, steadily increases : 
 
 That the supply of food tends, therefore, to augment, as the 
 domestic consumption declines : 
 
 That its price tends, therefore, steadily to fall, and is likely now 
 to be lower than has ever yet been known : 
 
 That the farmer, thus deprived of the ability to develop the 
 powers of his land, is more and more forced to limit himself to
 
 PRESIDENT OF THE UNITED STATES. 167 
 
 the work of robbing the earth of its soil, to be sold in distant 
 markets : 
 
 That the competition thus produced, for the sale of food, is 
 most injurious to the farmers of Continental Europe : 
 
 That the latter are thus deprived of the power to purchase cotton, 
 the price of which, with favorable seasons, is likely to fall to a 
 lower point than has ever yet been reached : 
 
 That the rewards of agricultural labor must, therefore, steadily 
 decrease, as the necessity -for resorting to the labors of the field 
 increases : 
 
 That with every step in this direction, both farmer and planter 
 become more entirely dependent upon the mysterious changes of 
 foreign markets prices rising, or falling, as consequences of acts 
 over which they can have no control whatsoever : 
 
 That under such circumstances, agriculture must become, with 
 each successive year, more gambling in its character : 
 
 That the rewards of productive industry must diminish, as the 
 temptation to engage in gambling and speculation becomes greater, 
 from year to year. 
 
 That the proportion of the population acting as middlemen, in 
 the various capacities of trader and transporter, lawyer and poll 
 tician, office-hunter and office-holder, must continue to increase: 
 
 That the taxes of the trader and transporter must steadily aug- 
 ment, as the powers of the land decline : 
 
 That as that taxation grows, the necessity for further dispersion 
 of the population, with growing necessity for further roads, must 
 steadily increase : 
 
 That, the greater the dependence on roads and ships, the less 
 must be the power to command the use of efficient ships and roads : 
 
 That the dependence of the farmer and the planter upon the 
 city trader, and that of the country at large upon the bankers of 
 Europe, must become greater from year to year : 
 
 That the power of commanding the services of the precious 
 metals must steadily diminish : , 
 
 That commerce at home must decline, as the dependence on 
 foreign markets increases : 
 
 That growing dependence upon the trader, and constantly in- 
 creasing instability in the societary action, must be attended by 
 constant diminution in the feeling of responsibility, and as con- 
 stant increase in the (demoralization that, with each successive day, 
 becomes more clearly manifest : 
 
 That the waste of power, now so great, must steadily increase, 
 with constant decline in the ability to produce the commodities 
 required for consumption : 
 
 That the ability to maintain the local institutions must continue 
 to diminish, and the necessity for further additions to our terri- 
 tory must as regularly increase : 
 
 That the expenditure of the Federal government must be a con-
 
 168 LETTERS TO THE 
 
 stantly augmenting quantity the needs of the Treasury growing 
 as the powers of the people decline : 
 
 That bankruptcy of the state must follow, as a necessary con- 
 sequence : 
 
 That constantly growing discord among the States must ulti- 
 mately annihilate all confidence in, and all desire for, the main- 
 tenance of the Union : and 
 
 That, with each successive year, it must become more obvious, 
 that the day is fast approaching, when " the republics of Greece, 
 Rome, and America, are to stand together among the ruins of the 
 past." 
 
 Such, Mr. President, has been the tendency of affairs, for the 
 quarter- century that has elapsed, since the Federal government 
 undertook the management of the currency the only difference 
 between the picture here presented, and that required for presen- 
 tation of the period from '3*7 to '42, being, that the shades de- 
 manded by the present, are far deeper than those needed for the 
 past. Then, centralization had but just begun to show itself. Now, 
 it is fast becoming universal. Till then, the right of the States 
 to control their local institutions, had scarcely at all been ques- 
 tioned. Now, the central power controls the municipal elections, 
 and menaces with extinction, the local rights. More progress 
 having been made, in this direction, under your immediate pre- 
 decessor, than had been made in the preceding five-and-twenty 
 years, that of each successive year is likely, should our present 
 policy be maintained, to be greater than that of the five years 
 through which we last have passed the progress of man, in 
 whatsoever direction, good or bad, being one of constant acce- 
 leration. 
 
 Why, Mr. President, should such things be ? Why is it, that 
 when, as you have told us, "the earth has yielded her fruits abun- 
 dantly, and has bountifully rewarded the labors of the husbandman" 
 when "our great staples have commanded high prices," and 
 when we "have possessed all the elements of material wealth in 
 rich abundance" that our "monetary interests" are in the 
 "deplorable condition" you have so well described ? "Why is it, 
 that "in the midst of unsurpassed plenty in all the productions 
 of agriculture and in all the elements of national wealth, we find 
 our manufactures suspended, our public works retarded, our 
 private enterprises of different kinds abandoned, and thousands 
 of useful laborers thrown out of employment, and reduced to want ?" 
 Why is it, that "the revenue of the government, which is chiefly 
 derived from duties on imports from abroad, has been greatly 
 reduced, whilst the appropriations made by Congress at its last 
 session for the current fiscal year are very large in amount ?" 
 
 Seeking a reply to these questions, we are met, at once, by the 
 fact, that they are precisely those which were asked in '22 and '42, 
 ,he former free-trade periods ; but directly the reverse of those which
 
 PRESIDENT OF THE UNITED STATES. 169 
 
 might have been asked in 1817, in 1835, and in 184T, the closing 
 years of the three periods in which it had been held, that it was 
 among the duties of a government to protect its people, and that 
 when it failed to do so, they would be governed from abroad 
 the home government being superseded by a foreign one, as is now 
 so much the case. 
 
 Seeking abroad a further answer, we find the people of France 
 profiting largely by increase in the value of the products of the 
 land, and of the land itself. Turning towards Denmark and Ger- 
 many, we find the serfs of the last century to have been replaced 
 by hundreds of thousands of small proprietors. Looking to 
 Russia, we are met by decrees, in virtue of which, serfdom has 
 already ceased throughout a large portion of the empire, and 
 must speedily cease in all. In all of these, the State becomes 
 stronger and more self-dependent, from year to year; whereas, 
 with us, it becomes weaker and more dependent. 
 
 Why should there be such differences ? Because, the policy of 
 all those countries tends towards the promotion of domestic com- 
 merce, and towards the substitution of the power of the govern- 
 ment for that of the traders and transporters the former find- 
 ing its strength increase with the growing wealth and power of 
 the people, and the latter rejoicing in their poverty and weakness. 
 We, on the contrary, are gradually, but certainly, transferring the 
 powers of the government to the hands of those who profit by 
 trade and transportation, and who, therefore, rejoice in destroying 
 the power of association and combination. Hence it is, Mr. Pre- 
 sident, that we, who claim to be the especial friends of freedom, 
 are constantly seeking the extension of slavery, while the despots 
 of Europe are as constantly engaged in striking the chains from 
 their subjects' limbs. 
 
 What we need is, the adoption of measures tending towards 
 limitation of the power of taxation exercised by foreign and 
 domestic traders and transporters, by which the value of land and 
 labor is now destroyed. Such was the tendency of the act of 
 August, 1842, which came into existence when commerce had 
 almost ceased, when bankruptcy was almost universal, and when 
 confidence in man, in banks, in States, and in the Federal Treasury, 
 had nearly perished. Scarcely had it become a law, when com- 
 merce once more started into life, confidence was restored, and 
 hope in the future was found taking the place of the despair, that 
 previously had been so nearly universal. Why was this ? Because 
 it had for its objects, the diversification of the demands for labor, 
 the facilitation of combination, the extension of commerce, and 
 the economizing of human power. It gave us, Mr. President, 
 that sort of free trade, that, as you have clearly seen, we so greatly 
 need freedom of intercourse between man and man, town and 
 town, county and city, State and State. That commerce we now 
 have not, nor can we have it, while the policy of the Federal
 
 170 LKTTKRS TO THE 
 
 government shall continue to be in accordance with the desires of 
 the people who seek to have raw materials cheap, and finished 
 commodities dear, and find, in enormous capitals, the most useful 
 of all the instruments of warfare required for depriving the nations 
 of the world, of all power for maintaining direct intercourse with 
 each other. 
 
 Restore the act of 1842, Mr. President, and a demand for 
 labor will arise relieving us of all further necessity for perusing 
 the shocking accounts of poverty, despair, crime, and death, with 
 which our journals are now filled. Let it be restored, and mills 
 and furnaces will at once be re-opened making demand for 
 labor, food, and raw materials, and checking decline in the prices 
 of corn and cotton. Let it be restored, and your second Message 
 will present a picture of prosperity among the people, and strength 
 in the State, directly the reverse of the exhibit of poverty in the 
 one, and weakness in the other, offered by your first. 
 
 Why can it not be restored ? Because the generally dominant 
 party failing to see that the sort of free trade we really needed, 
 was the one you have yourself so well described has, for more 
 than twenty years, repudiated the ideas of our revolutionary fathers, 
 and of all our presidents from Washington to Jackson ; and, 
 having done so, must now repudiate all change. That it may 
 maintain its consistency, it is required that we continue to pursue 
 a policy that has been repudiated by all the advancing nations of 
 Europe, and that has, wherever tried, here or elsewhere, resulted 
 in bankruptcy and ruin. That it may be maintained, we must 
 continue to exhaust our land ; we must continue to pay a tax of 
 transportation, greater than would be required for maintaining 
 millions of men in arms ; we must continue to waste capital capa- 
 ble, if properly applied, of more than doubling our productive 
 power ; we must continue to see our people perish, in default of 
 power to find purchasers for their labor ; we must continue to see 
 capital acquire power at the cost of labor; we must continue 
 and extend, the necessity for seeking public employments ; we must 
 continue to enlarge our territory, and with it, the necessity for 
 fleets and armies ; we must continue to augment the power of the 
 central authorities, at the cost of the local ones ; and finally, we 
 must proceed onward in a course leading, and that inevitably, to 
 the downfall of the system established by the men who achieved the 
 Revolution, and who made the Constitution of 1789. 
 
 Those, Mr. President, who advocate further progress in that 
 direction, can have little idea of the terrific responsibility that 
 attaches itself to the administration of the affairs of nations. 
 If it is a crime to take the life of a single man, what must it 
 be, to subject millions of people to a policy leading inevitably to 
 poverty, despair, and death? If seduction is a crime, what, Mr. 
 President, is the criminality of those who, for party purposes, ad- 
 rocate the maintenance of a system which, by destroying the
 
 PRESIDENT OF THE UNITED STATES. 171 
 
 
 
 demand for female labor, leaves to tens, even if not hundreds, of 
 thousands of our women, no choice but that between prostitution 
 on the one hand, and starvation on the other ? 
 
 It is time, that those charged with the administration of our 
 affairs, should waken to the knowledge, that protection to the people 
 is, in fact, protection to the government itself. The policy which 
 transfers to foreign merchants and foreign States, the power of 
 taxation, must result in bankruptcy of the treasury, ruin of the 
 people, and downfall of the government. So it has always been, 
 and so must it ever be. 
 
 The rock upon which our ship is likely, Mr. President, to be 
 wrecked, is that of trading and political centralization the last 
 a necessary consequence of the first. The more the policy of the 
 country tends towards augmentation of the tax of transportation, 
 the more rapid becomes the motion of our ship in the wrong 
 direction, and the nearer approaches the day of wreck. You, Mr. 
 President, are our pilot, and if we are to avoid the rocks, it is 
 for you to change the direction of the helm. If that be not done, 
 the story of our Union will stand before posterity, as presenting 
 the most remarkable case of shipwreck recorded in the annals of 
 the world. 
 
 Hoping, that under your pilotage, the course may be changed, 
 and that the period of your administration may stand upon the 
 record, as the one in which the policy of fostering domestic com- 
 merce as the true foundation of an extended intercourse with 
 foreign nations, had been definitively adopted, I remain, Mr. Pre- 
 sident, with many apologies for my repeated trespasses upon your 
 time and attention, 
 
 With great respect, 
 
 Your obed't servant, 
 
 HENRY C. CAREY. 
 
 Philadelphia, March 17 th, 1858. 
 
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