Splendid Exchange, A

by Bernstein, William L

  Who are that blustering, canting crew,

  Who keep the cheap loaf in our view,

  And would from us more profit screw?

  The League.

  Who cry “Repeal the curs’d Corn Law,”

  And would their workmen feed with straw,

  That they may filthy lucre paw?

  The League.

  Who wish to gull the working man,

  And burk the Charter, if they can,

  With their self-aggrandizing plan,

  The League.

  Quoted in Hinde, 70.

  85. Lord Ernle, English Farming (Chicago: Quadrangle, 1961), 274.

  86. Fay, 98; see also Fairlie, 571.

  87. Barnes, 274–276. See also Michael Lusztig, “Solving Peel’s Puzzle: Repeal of the Corn Laws and Institutional Preservation,” Comparative Politics 27, no. 4 (July 1995): 400–401.

  88. Hinde, 103–104, 135–168. Disraeli attacked Peel with the vituperation of a skilled novelist: “[Peel] has traded on the ideas and intelligence of others. His life has been one grand appropriation clause. He is a burglar of other’s intellect.” Quoted in Barnes, 278.

  89. In practice, “repeal” meant that duties were drastically lowered until February 1, 1849, at which point they were to be lowered yet further to one shilling per quarter. After 1869, they were abolished altogether. See Ernle, 274.

  90. Jeffrey G. Williamson, “The Impact of the Corn Laws Just Prior to Repeal,” Explorations in Economic History 27 (1990): 127–129.

  91. J. A. Hobson, Richard Cobden, the International Man (London: Ernest Benn, 1968), 248.

  92. John Morley, The Life of Richard Cobden (London: T. Fisher Unwin, 1903), 721.

  93. Charles Kindleberger, “The Rise of Free Trade in Western Europe, 1820–1875,” Journal of Economic History 31, no. 1 (March 1975): 37–38.

  94. Quoted in Bairoch, 29–30.

  95. Morley, 751. Gladstone was by this time the Liberal (the successor party to the Whigs) chancellor of the exchequer.

  96. Bairoch, “European trade policy, 1815–1914,” 39–45.

  97. Fay, 106; Barnes 291. Britain’s main grain suppliers before 1846, Poland and Germany, also became unable to feed themselves. See Fairlie, 568.

  Chapter 12

  1. John Stuart Mill, Principles of Political Economy (New York: Appleton, 1888), 378,

  2. Joseph Conrad, The Mirror of the Sea (New York: Doubleday, Page, 1924), 11–12.

  3. Copper has a very high specific gravity, weighing nine times its volume of water. Copper ore is a mix of copper-containing compounds and mineral contaminants, almost all of which are lighter than copper. Thus, the higher the copper content of the ore, the heavier it is.

  4. Herbert V. Young, They Came to Jerome (Jerome, AZ: Jerome Historical Society, 1972), 17.

  5. Ronald Roope, personal communication; Ronald Prain, Copper (London: Mining Journal Books, 1975), 17–18, 21–22.

  6. W. O. Henderson, Friedrich List (London: Frank Cass, 1983), 68–75, 143–182.

  7. The one exception on import duties was a brief period of high proceeds from public land sales during the 1830s. See Mark Thornton and Robert B. Ekelund Jr., Tariffs, Blockades, and Inflation (Wilmington, DE: Scholarly Resources, 2004), 13.

  8. John G. Van Deusen, “Economic Bases of Disunion in South Carolina” (Ph.D. thesis, Columbia University, 1928), 182–183.

  9. The representatives from New England also favored the tariff, albeit by a less impressive margin, enabling the bill to pass. See Thornton and Ekelund, 19–20.

  10. F. W. Taussig, The Tariff History of the United States (New York: Capricorn, 1964), 68–110. See also Donald J. Ratcliffe, “The Nullification Crisis, Southern Discontent, and the American Political Process,” American Nineteenth Century History 1, no. 2 (Summer 2000): 3–5.

  11. William W. Freehling, The Road to Disunion (Oxford: Oxford University Press), I:256. The fallacy in McDuffie’s argument is that South Carolinians spent only a small portion of their income on imported goods. Still, the fact remains that the South paid for the shielding of northern industry, while its own exports needed none.

  12. Richard B. Latner, “The Nullification Crisis and Republican Subversion,” Journal of Southern History 43, no. 1 (February 1977): 21.

  13. Richard E. Ellis, The Union at Risk (Oxford: Oxford University Press, 1987), 46.

  14. Ibid., 23, 33. This was not the first time South Carolina had nullified a federal law. In 1822, the state passed legislation requiring the jailing of foreign black seamen who arrived in its ports, in direct contradiction of federal law and of treaty obligations to England. The federal government, not wanting a confrontation, quietly let the state law stand, and thus granted South Carolina the de facto right of nullification. See Freehling, 254.

  15. Ellis, 158–177.

  16. Ratcliffe, 8, 22–23.

  17. Reinhard H. Luthin, “Abraham Lincoln and the Tariff,” The American Historical Review 49, no. 4 (July 1944): 612, 622.

  18. Lyon G. Tyler, “The South and Self-Determination,” William and Mary College Quarterly Historical Magazine 27, no. 4 (April 1919): 224.

  19. John. L. Conger, “South Carolina and the Early Tariffs,” The Mississippi Valley Historical Review 5, no. 4 (March 1919): 431–433.

  20. Freehling, 272.

  21. Natchez Free Trader, November 27, 1860, quoted in P. L. Rainwater, “Economic Benefits of Secession: Opinions in Mississippi in the 1850s,” The Journal of Southern History 1, no. 4 (November 1935): 470–471.

  22. Recomputed from Paul Bairoch, “European Trade Policy, 1815–1914,” 56, at a 2007/1988 inflation conversion factor of 1.75.

  23. F. Daniel Larkin, “Erie Canal Freight,” New York State Archives Time Machine, http://www.archives.nysed.gov/projects/eriecanal/ErieEssay/ecf.html, accessed February 12, 2007.

  24. See David Landes, The Unbound Prometheus (Cambridge: Cambridge University Press, 1969), 251–259; and W. T. Jeans, The Creators of the Age of Steel (New York: Scribner, 1884), 29.

  25. Charles K. Harley, “The Shift from Sailing Ships to Steamships, 1850–1890: A Study in Technological Change and Its Diffusion,” in Donald N. McCloskey, ed., Essays on a Mature Economy (Princeton: Princeton University Press, 1971), 215–225.

  26. Gerald S. Graham, “The Ascendancy of the Sailing Ship 1850–1885,” Economic History Review 9, no. 1 (1956): 79.

  27. In a later paper, Harley estimated that in the late 1860s, the steam-sail boundary lay between 3,000 and 3,500 miles, considerably shorter than the approximately 7,000 miles predicted by this model. Still, the basic premise holds: evolutionary improvements in engine and hull design brought a gradual lengthening of the steam-sail boundary over the course of the nineteenth century. See C. Knick Harley, “Ocean Freight Rates and Productivity, 1740–1913: The Primacy of Mechanical Invention Reaffirmed,” Journal of Economic History 48, no. 4 (December 1988): 863–864.

  28. Conrad, 47–48. He may not have been an entirely disinterested observer. Trained on wooden ships and briefly a ship’s master, Conrad found himself out of work with the ascendancy of the steamship and turned to writing. The steam age thus resulted not only in more efficient trade but also a better understanding of “the horror, the horror,” of colonialism.

  29. Juan E. Oribe Stemmer, “Freight Rates in the Trade between Europe and South America, 1840–1914,” Journal of Latin American Studies 21, no. 1 (February 1989): 44.

  30. Extrapolated from table IV, Lewis R. Fischer and Helge W. Nordvik, “Maritime Transport and the Integration of the North Atlantic Economy, 1850–1914,” in Wolfram Fischer et al., eds., The Emergence of a World Economy 1500–1914 (Wiesbaden, Commissioned by Franz Steiner Verlag, 1986), II:531.

  31. Harley, 221–225.

  32. Computed from Bairoch, 56.

  33. Ronald W. Filante, “A Note on the Economic Viability of the Erie Canal, 1825–1860, Business History Review 48, no. 1 (Spring 1974): 100.

  34. George G. Tunell, “The Divers
ion of the Flour and Grain Traffic from the Great Lakes to the Railroads,” Journal of Political Economy 5, no. 3 (June 1897): 340–361.

  35. Gavin Weightman, The Frozen Water Trade (New York: Hyperion, 2003), 7, 71, 105–109, 127–143. For a detailed description of Wyeth’s invention and ancillary ice-harvesting tools, see Oscar Edward Anderson Jr., Refrigeration in America (Princeton: Princeton University Press for the University of Cincinnati, 1953), 13–35.

  36. Henry D. Thoreau, Walden (Boston: Houghton Mifflin, 1938), 329.

  37. Weightman, 163, 207.

  38. Anderson, 21–22, 50–52.

  39. John H. White, The Great Yellow Fleet (San Marino, CA: Golden West, 1986), 11–13.

  40. Weightman, 223–224.

  41. James Troubridge Critchell and Joseph Raymond, A History of the Frozen Meat Trade, 2nd ed. (London: Constable, 1912), 25.

  42. Pride of place in artificially refrigerated shipping probably belongs to the Frenchman Charles Tellier, who in 1876–1877 shipped chilled beef in the Frigorifique, a steamer fitted with an ammonia compression device, from Buenos Aires to Rouen. See E. G. Jones, “The Argentine Refrigerated Meat Industry,” Economica 26 (June 1929): 160.

  43. Critchell and Raymond, 3, 9, 26–29. For a detailed discussion of the relative advantages of chilled and frozen beef, see Richard Perren, “The North American Beef and Cattle Trade with Great Britain, 1870–1914,” Economic History Review 24, no. 3 (August 1971): 430–434.

  44. “Coal Ammonia for Refrigeration,” Scientific American LXIV (1891): 241.

  45. Larry Tye, The Father of Spin (New York: Crown, 1998), 51–52.

  46. Fischer and Nordvik, II:526.

  47. Max Fletcher, “The Suez Canal and World Shipping, 1869–1914,” Journal of Economic History 18, no. 4 (December 1958): 556–573.

  Chapter 13

  1. Cordell Hull, International Trade and Domestic Prosperity (Washington, DC: United States Government Printing Office, 1934), 5.

  2. Joseph M. Jones Jr., Tariff Retaliation (Philadelphia: University of Pennsylvania Press, 1934), 74.

  3. Ibid., 1931.

  4. C. Knick Harley, “Transportation, the World Wheat Trade, and the Kuznets Cycle, 1850–1913,” Explorations in Economic History 17, no. 3 (July 1980): 223, 246–247.

  5. C. P. Kindleberger, “Group Behavior and International Trade,” Journal of Political Economy 59, no. 1 (February 1951): 31.

  6. Kevin O’Rourke and Jeffrey G. Williamson, “Late Nineteenth Century Anglo-American Price Convergence: Were Heckscher and Ohlin Right?” Journal of Economic History 54, no. 4 (December 1994): 900.

  7. A. J. H. Latham and Larry Neal, “The International Market in Rice and Wheat, 1868–1914,” Economic History Review 36, no. 2 (May 1983): 260–280.

  8. Here, the term “rents” is used loosely to mean the price of land, as paid for with a mortgage, outright payment, or rental money.

  9. Bertil Ohlin, Interregional and International Trade (Cambridge: Harvard University Press, 1957), 35–50; Eli Heckscher, “The Effect of Foreign Trade on the Distribution of Income,” in Readings in the Theory of International Trade (Homewood IL: Irwin, 1950), 272–300. For the most succinct statements of their theorem, see Ohlin, 35; and Heckscher, 287.

  10. O’Rourke and Williamson, “Late Nineteenth Century Anglo-American Price Convergence: Were Nechscher and Ohlin Right?”, 894–895, 908.

  11. Jeffrey G. Williamson, “The Evolution of Global Labor Markets since 1830: Background Evidence and Hypotheses,” Explorations in Economic History 32 (1995), 141–196; Kevin H. O’Rourke and Jeffrey G. Williamson, Globalization and History (Cambridge: MIT Press, 1999), 286.

  12. Wolfgang F. Stolper and Paul Samuelson, “Protection and Real Wages,” Review of Economic Studies 9, no. 1 (November 1941): 58–73. The narrowest description of the Stolper-Samuelson theorem is as follows: when the relative price of a good increases, so too will the return to the factor which is used most intensively in the production of it, and the return to the less intensively used factor will fall.

  13. This is true in “segmented markets,” that is, where capital does not flow easily across borders. It is certainly not true today.

  14. Eugene Owen Golob, The Méline Tariff (New York: AMS, 1968), 22–23, 78–79; Angus Maddison, The World Economy, 95.

  15. Golob, 83–85, 189–190.

  16. Ibid., 245.

  17. Kindleberger, “Group Behavior and International Trade,” 32–33.

  18. Douglas A. Irwin, “The Political Economy of Free Trade: Voting in the British General Election of 1906,” Journal of Law and Economics 37, no. 1 (April 1994): 75–108.

  19. Einar Jensen, Danish Agriculture (Copenhagen: J. H. Schultz Forlag, 1937), 251, 315–334, Harald Faber, Co-operation in Danish Agriculture (New York: Longmans, Green, 1937), 31–70, 105–106; Henry C. Taylor and Anne Dewees Taylor, World Trade in Agricultural Products (New York: Macmillan, 1943), 179; Alexander Gerschenkron, Bread and Democracy in Germany (Ithaca NY: Cornell University Press, 1989), 39.

  20. The term itself likely derives from junk Herr, “young lord.”

  21. Gerschenkron, 42.

  22. It is theoretically possible for a nation to have a relative abundance or scarcity of all three factors, but whether this actually occurs in practice is debatable.

  23. Gerschenkron, 3–80.

  24. Karl Marx, The Poverty of Philosophy (New York: International Publishers, 1963), 224. Marx had it wrong: later twentieth-century history would prove the Hungarian maxim that communism is “the longest road from capitalism to capitalism.” William D. Nordhaus, “Soviet Economic Reform: The Longest Road,” Brookings Papers on Economic Activity 1990, no. 1 (1990): 287.

  25. In the preceding pages, I have adopted the controversial “broad” interpretation of Stolper-Samuelson offered by Rogowski in Commerce and Coalitions (Princeton: Princeton University Press, 1989), 1–60. On the one hand, Rogowski’s interpretation of Stolper-Samuelson overextends their original two-commodity, twofactor model: see Douglas A. Irwin, Review: [Untitled], Journal of Economic History 50, no. 2 (June 1990): 509–510. Stolper and Samuelson themselves recognized this problem in their original paper, observing that while there may have been extreme cases where most laborers were made worse off by free trade, as in Australia or the colonial United States, this occurs only rarely in the modern world: “It does not follow that the American working man today would be better off if trade with, say, the tropics were cut off, because suitable land for growing coffee, rubber, and bananas is ever scarcer than is labor.” (Stolper and Samuelson, 73). On the other hand, Rogowski’s liberal interpretation of Stolper-Samuelson fits the historical record remarkably well despite its theoretical flaws. See O’Rourke and Williamson, Globalization and History, 109–110. For a further refinement of Rogowski’s thesis, see Paul Midford, “International Trade and Domestic Politics: Improving on Rogowski’s Model of Political Alignments,” International Organization 47, no. 4 (Autumn 1993): 535–564. Further, even when workers are, on average, not harmed by free trade, small groups of them certainly are. More important, the majority of workers or farmers may behave as if trade harms them, even if in fact it does not, as happened to the northern German peasants duped by the Junkers into supporting protectionism.

  26. Real values, computed from W. W. Rostow, The World Economy (Austin: University of Texas, 1978), 669; and Maddison, 361, 362.

  27. Carolyn Rhodes, Reciprocity, U.S. Trade Policy, and the GATT Regime (Ithaca, NY: Cornell University Press, 1993), 23–45.

  28. http://www.whitehouse.gov/history/presidents/hh31.html accessed March 7, 2007.

  29. Colleen M. Callahan et al., “Who Voted for Smoot-Hawley?” Journal of Economic History 54, no. 3 (September 1994): 683–684.

  30. Charles P. Kindleberger, “Commercial Policy between the Wars,” in Peter Mathias and Sidney Pollard, eds., The Cambridge Economic History of Europe (Cambridge: Cambridge University Press, 1989), VIII:170–171.

  31. Jones, Tariff Retaliation, 40, 7
6–82, 105–109.

  32. Cordell Hull, The Memoirs of Cordell Hull (New York: Macmillan, 1948), I:364–365.

  33. Hull, International Trade and Domestic Prosperity, 2.

  34. The precise amount of the falloff in world trade is difficult to quantify. Paul Bairoch estimates it at 60 percent in value and 35 percent in volume. Since this was a period of significant deflation, the true value is probably between these two figures. See Bairoch, Economics and World History, 9.

  35. Maddison, The World Economy, 363; and Monitoring the World Economy (Paris: OECD, 1995), 182–183, 196.

  36. See, for example, Giorgio Basevi, “The Restrictive Effect of the U.S. Tariff and its Welfare Value,” American Economic Review 58, no. 4 (September 1968): 851. Some observers believe that protectionism actually raised national income in the larger nations, particularly in the United States and England. See John Conybeare, “Trade Wars: A Comparative Study of Anglo-Hanse, Franco-Italian, and Hawley-Smoot Conflicts,” World Politics,” 38, no. 1 (October 1985): 169–170; and Michael Kitson and Solomos Solomu, Protectionism and Economic Revival: The British Interwar Economy (Cambridge: Cambridge University Press, 1990), 100–102.

  37. Douglas A. Irwin, “The Smoot-Hawley Tariff: A Quantitative Assessment,” Review of Economics and Statistics 80, no. 2 (May 1998): 326–334; Jakob B. Madsen, “Trade Barriers and the Collapse of World Trade during the Great Depression,” Southern Economic Journal 64, no. 4 (April 2001): 848–868.

  38. John Stuart Mill, Principles of Political Economy, 389–390.

  39. J. B. Condliffe, The Reconstruction of World Trade (New York: Norton, 1940), 394.