SIDE LIGHTS ON THE "LITTLE BROTHER TO THE PAYNE-ALDRICH TARIFF LAW"

SIDE LIGHTS on "The Little Brother to the Payne-Aldrich Tariff Law" THIS BILL gives to certain manufactured products higher protective duties than does the Payne-Aldrich law. This can be easily...

...A tariff rate upon raw material is protection to the producer, but not to the manufacturer who transforms it into a finished product...
...The present tariff upon wheat is 25 cents per bushel...
...The tariff upon the manufactured product would be $1.20 upon the barrel of flour and 14 cents upon the 70 pounds of bran and middlings, or $1.34...
...It actually grants to certain special interests greater protection then they enjoy under the present law...
...Now, let us see what this bill does...
...I have worked out a few of the increases and present them as examples of the general character of the bill...
...Of this $1.34, $1.13 is the compensatory duty upon the 4 1/2bushels of wheat which has been used, leaving, under the present law, a protective duty to the miller of 21 cents a barrel upon his flour and his 70 pounds of bran and middlings...
...they are all protective...
...Upon his barrel of flour he is given a duty of 50 cents, and upon bran he is given a duty of 12 1/2 cents per 100 pounds, which, upon the 70 pounds manufactured out of the 4 1/2 bushels of wheat, amounts to 8 3/4 cents, or a total protective duty of 58 3/4 cents under this bill as against 21 cents under tha Payne-Aldrich law, an increase or 180 per cent...
...The first duty is called compensatory...
...Now, we all know that in all tariff measures we deal with two classes of rates, compensatory and protective...
...For instance, in the case of wheat: If an American miller buys a thousand bushels of wheat in Canada to make into flour, he must pay the duty of 25 cents a bushel when he brings that wheat into the United States to be ground into flour for the American market...
...Wheat is made free, so there are no compensatory rates to be considered...
...In order to save him from absolute loss in such a transaction and place him on an equal footing with the Canadian miller, it is the theory of protection that the duty upon flour shall be high enough, first, to offset or compensate the miller for the amount of duty paid upon the wheat, or 25 cents per bushel, with an added amount of duty sufficient to measure the difference in the cost of milling...
...the second, protection...
...According to the Government publication, "Commerce and Navigation," the average value of flour imported into this country from Canada in 1909 was $4.80 and the duty paid was $1.20 per barrel...
...SIDE LIGHTS on "The Little Brother to the Payne-Aldrich Tariff Law" THIS BILL gives to certain manufactured products higher protective duties than does the Payne-Aldrich law...
...Four and one-half bushels of wheat will, on the average, produce 1 barrel of flour and 70 pounds of bran and middlings...
...The average value of bran and middlings was $20 per ton and the present tariff is 20 per cent ad valorem, or $4 per ton...
...Now, taking out 4 1/2 bushels of wheat, if imported as such, the duty under the present law would be $1.13...
...The present tariff upon a barrel of flour is 25 per cent, ad valorem...
...The duty on 4 1/2 bushels of wheat would, therefore, be $1.13...
...This can be easily demonstrated...

Vol. 3 • August 1911 • No. 33


 
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