University of Virginia Library

TO RUFUS KING.

In my last of the 10th instant, I took occasion to remark
to you the extensive injury threatened to our navigation by
the countervailing Act of Great Britain, the inconsistency of
that act, in our judgment, with the true sense of the Treaty of
1794, and the several remedies for the case, which occurred
for consideration;—among which that of a revision of the
British Act, and an adjustment of it to a more equitable rule,
was suggested as an object proper to be sought by your immediate
interposition with the British Government. The
circumstances of haste and indisposition under which the
latter was written rendered the development of the subject
so incompetent that it cannot be too soon resumed.

I must repeat that the Treaty of 1794 in authorizing a
countervailing duty on the part of Great Britain, can be

fairly understood to mean no more than that the navigation of
the two countries might be put on as equal a footing as it would
have remained on, if the regulation of Congress to be countervailed,
had never passed. This position does not appear to be
susceptible of denial or controversy. In order to re-establish
such an equality, either of two courses would have been
sufficient; first that of repealing the regulations of Congress
charged with introducing an inequality in our favor; or secondly
that of enacting in Great Britain regulations countervailing
or balancing the inequality, and consequently having
the like effect of re-establishing an equality. As the first
course was not taken by the United States, and as that taken
by Great Britain has produced a greater inequality in her favor
than before existed against her, an important question now
to be considered is, by what remodification, her countervailing
act can be made to produce the just equality contemplated
by the Treaty, in place of that transposed and augmented
inequality resulting from the Act in its present form.

It seems clear that the British act in its present form has
departed from the rule of justice and equality by making her
own tariff instead of that of the United States the basis of an
act for countervailing and equalizing a discrimination founded
on the latter tariff. The deviation, though leaving a sufficient
advantage to the British navigation, would be more
striking if the Act had adhered to the rigour of the British
tariff as the assumed construction of the Treaty would have
authorized. The difference, for example, of one shilling and
six pence sterling per hundred pounds of tobacco might have
been raised as high as five shillings, amounting to twelve or
fifteen dollars per Hogshead. Pig iron is another example:
the difference of 6 1/2 per ton might have been raised to more
than 30 p Ct. of the value of the article. The British tariff
in General being much greater than that of the United States
one tenth of the former operating as a bounty in favour of
British ships must proportionally exceed the operation of one
tenth of the latter in favour of American ships.

Another observation to be made is, that the British act by
imposing the countervailing burden on the productions of the
United States, has made it impossible to regulate it according
to any principle of sufficient uniformity and equality in relation
to the ships of the two countries. How compare together
things so different as the merchandize and manufactures of
one country, with the heterogeneous productions of the other?
In what mode is the value of the latter to be ascertained in
British ports; as exactly as the value of the former is ascertained
in the American ports? or if this difficulty should
not be insurmountable, in the articles taxed according to
their value; how, in what proportion, and by what classifications,
are the American articles to be subjected to different
rates in Great Britain, corresponding with the different rates
of 7–1/2. 10 12–1/2 per Cwt 7c. assessed in the United States
on the articles of Great Britain? or by what rule could an
average of these rates, considering the inequality in value and
bulk of the several classes of articles to which they are applied,
be deduced, that would put the navigation of the two countries
on that bona fide equality which the Treaty requires?
or again, laying aside all the perplexities, how is it possible
even to find a practicable rule of comparison and equalization
for articles taxed not according to value; but according to
quantity; and where the quantity may be defined in articles on
one side by weight, and in articles on the other side by measure,
and in some instances without any precise reference to
either.

In addition to these considerations, it is of decisive importance
that the tendency of a countervailing regulation
applied to the productions of the United States imported into
Great Britain is to favour the carriage of these in British
bottoms; as the carriage of British manufactures in American
bottoms, is favoured by the discriminating duty of the United
States. Now as the productions of the United States, from
their bulky character, employ at least ten times the tonnage
which is required for the exports of Great Britain, and as it

is always to be kept in view that the object of the Treaty was
not to encourage or discourage the productions or manufactures,
or even the Commerce of both countries, but merely
to give a fair equality and competition to the vessels navigating
between them, it follows both that an undue advantage accrues
to the British navigation, and that the object of the
Treaty is proportionally violated by any discriminating
burden on the productions of the United States, which will
give to British bottoms a preference in the carriage of them.
If a regulation of this sort could be just or within the meaning
of the compact at all, it ought to be so contrived as to give a
preference to the same number of British vessels in carrying
the productions of the United States to Great Britain as there
is of american vessels enjoying under our law a preference in
bringing British merchandize to the United States; that is to
say on the supposition that our exports to Great Britain
employ ten times as many vessels as her exports to this
country that her countervailing regulations ought to secure
to her vessels the carriage of 1/10 only of our productions, or in
any point of view, such a proportion only as would leave to
the vessels of the United States as much of the carriage of our
productions as with their carriage of the manufactures of
Great Britain, imported into this country, would divide equally
between American and British vessels the joint amount of
the carriage between the two countries. It is manifest however
that no regulation could be so skilfully shaped as to
produce such a result. And it is equally certain that the
regulation actually adopted by Great Britain must have the
effect of monopolizing the transportation of the whole mass
of our bulky articles, whilst the most that can be hoped by the
United States will be a monopoly for their vessels of British
articles not amounting to one tenth of that bulk. Nay, even
this very unequal monopoly cannot be expected; because,
of the many British vessels bound for our productions, it
would often happen that some instead of coming in ballast
would take a cargo without freight or with little freight, and
in that way increase the balance of their navigation against
the American side of the account.

If these remarks be in any degree just, they must prove that
with a view to a bona fide and practicable mode of imposing a
countervailing duty Great Britain must withdraw it from the
American productions which are so various in themselves and
so dissimilar to her articles of merchandise as to admit of no
rational comparison between them for the purpose in question,
as well as renounce the use of a tariff so much exceeding that
which is the basis of our discriminating duty, and must seek
for a countervailing rule where alone it can be found, viz in
the application of the same duty to the same objects which in
the regulation of the United States produced the state of
things which is to be countervailed. She must impose on her
exports to this Country, in american bottoms the same discrimination
of 10 p Cent as our law imposes on her exports to
this Country in British bottoms. This will produce a real and
precise countervailing effect, and this alone can produce one
that will be real and precise.

To this expedient for redressing at once, the existing inequality
in favour of British bottoms, and the inequality in
favour of american bottoms complained of at the date of the
Treaty, and provided against by that instrument it may be
objected that the american tariff applied to British Articles
in american ports, might not be applicable to the same articles
on their leaving British ports. But it is probable that the
adjustment of our tariff to the latter case would be made with
as little difficulty and in fewer words than are now employed
in the complicated regulations on this subject contained in the
British Statute. It may also be objected that as american vessels
bound with cargoes from Great Britain to the United States
might clear out for other countries the additional duty of 10 p
Cent might be eluded, and the British thereby deprived of the
benefits of the Treaty. To this objection the answer is, that
the abuse might be guarded against by requiring in Great
Britain security from american vessels that they shall produce

a certificate of their having delivered their cargoes elsewhere
than in the ports of the United States; or by an engagement
on the part of the United States to require from their vessels
bringing cargoes from Great Britain, a certificate of their having
there paid the discriminating duty, or by both of these
regulations. It may be further answered, that however imperfect
or inconvenient these precautions may be, they are
less objectionable than the palpable violation of equality existing
under the present countervailing act. Lastly it may be
said by the British administration that such a modification
of the countervailing act would be the same thing with a
repeal of all discrimination, and that the latter as the more
simple and convenient remedy, ought to be preferred. Should
this be said it will amount to an admission of the solidity of
our objections to the present countervailing Act which works
a very different effect, and will lead to the measure of repealing
both that act and the Act of Congress—so far as they relate
to the additional duty of 10 p Cent. If this measure can be
immediately accomplished, it claims a preference, on the
whole, over any other expedient, and if the British Government
is disposed to come into it, an act of Parliament can
readily be passed with a clause suspending its operation on a
proclamation to be issued by the Executive authority on due
notice of a correspondent repeal by Congress. And Congress
if so disposed, can also immediately pass an act for the purpose
with a like suspending clause. This might be the more
expected as it is probable the difficulty, hinted in my last, as
incident to a repeal of the discriminating duty here may be
got over, and as such a proposition, which you will find in the
newspaper, herewith sent, is now depending before the House
of Representatives. In the meantime however, until these
concurrent repeals shall be put into force, our navigation will
continue to suffer, unless some alleviating regulation can be
obtained from the equity and liberal policy of the British
Government.

Were the constitution not a barrier to duties on exports, it

would not be very difficult for Congress to provide a remedy of
themselves by repealing the present discrimination on imports,
and imposing on our exports in British bottoms precisely the
same duty, which her countervailing clauses adds on the
importation of them in american bottoms, into Great Britain.
Such measure could not be complained of by Great Britain,
and the principle of it is exactly the same with that of the
measure above contended for, as a necessary substitute for
the present countervailing act of Great Britain; in case the
better remedy of a repeal of the Acts on both sides, cannot
be put into immediate train.

From the view here taken of the subject it seems advisable
that you promote through the medium of proper representations
and explanations to the British Government, a repeal of
the countervailing part of the British statute, on the condition
above stated, so far as respects the difference of 10 p Ct.
With respect to the tonnage duty, which is made the same in
its rates with that of ours, and which in case the 10 p Ct. duty
be removed, is not likely to operate on more of our vessels
than our tonnage duty will on British vessels, it may perhaps
be well not to include that in the repeal, especially as it would
have the effect of substracting that much from our revenue.
A better course will be, if the British Parliament be pliant
on the occasion for the repealing act to be so modified as:
to apply to one or both discriminations, as may concur with
the Act of Congress which also if Congress should view the
subject in the same light can be modified in a similar
manner.

The temptation of Great Britain to detain our seamen in
her service, having expired with the war, it is hoped there will
be no difficulty in obtaining a general discharge of them,
without the further trouble of proof, or particular enquiry.
And you will perceive the propriety of hastening the measure,
as much as possible for the sake of those who may be on board
of ships allotted for distant stations or service. Whenever
these unfortunate people may be discharged, justice will

require that their dues of every sort, be paid off, and their
return to their own Country be provided for.

The Convention with France has received the sanction requested
from the Senate, by the President, and the Proclamation
of it has issued accordingly, you will find it in one of
the inclosed newspapers.