KEFIKED SUGARS AND CHOCOLATE

Are among the number of extensive and prosperous domestic manufactures.

Drawbacks of the duties upon the materials of which they are respectively made, in cases of exportation, would have a beneficial influence upon the manufacture, and would conform to a precedent which has been already furnished in the instance of molasses on the exportation of distilled spirits.

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Cocoa: — the raw material now pays a duty of one cent per pound, while chocolate, which is a prevailing and very simple manufacture, is comprised in the mass of articles rated at no more than five per cent.

There would appear to be a propriety in encouraging the manufacture by a somewhat higher duty on its foreign rival than is paid on the raw material. Two cents per pound on imported chocolate would, it is presumed, be without inconvenience.

The foregoing heads comprise the most important of the several kinds of manufactures which have occurred as requiring and at the same time as most proper for public encouragement; and such measures for affording it, as have appeared best calculated to answer the end, have been suggested.

The observations which have accompanied this delineation of objects supersede the necessity of many supplementary remarks. One or two, however, may not be altogether superfluous.

Bounties are in various instances proposed as one species of encouragement.

It is a familiar objection to them that they are difficult to be managed and liable to frauds. But neither that difficulty nor this danger seems sufficiently great to countervail the advantages of which they are productive when rightly applied. And it is presumed to have been shown that they are in some cases, particularly in the infancy of new enterprises, indispensable.

It will however be necessary to guard with extraordinary circumspection the manner of dispensing them. The requisite precautions have been thought of, but to enter into the detail would swell this report, already voluminous, to a size too inconvenient.

If the principle shall not be deemed inadmissible, the means of avoiding an abuse of it will not be likely Edition: current; Page: [104] to present insurmountable obstacles. There are useful guides from practice in other quarters.

It shall therefore only be remarked here in relation to this point, that any bounty which may be applied to the manufacture of an article cannot with safety extend beyond those manufactories at which the making of the article is a regular trade. It would be impossible to annex adequate precautions to a benefit of that nature, if extended to every private family in which the manufacture was incidentally carried on, and it being a merely incidental occupation which engages a portion of time that would otherwise be lost, it can be advantageously carried on without so special an aid.

The possibility of a diminution of the revenue may also present itself as an objection to the arrangements which have been submitted.

But there is no truth which may be more firmly relied upon than that the interests of the revenue are promoted by whatever promotes an increase of national industry and wealth.

In proportion to the degree of these is the capacity of every country to contribute to the public treasury; and where the capacity to pay is increased or even is not decreased, the only consequence of measures which diminish any particular resource is a change of the object. If by encouraging the manufacture of an article at home, the revenue which has been wont to accrue from its importation should be lessened, an indemnification can easily be found either out of the manufacture itself, or from some other object which may be deemed more convenient.

The measures, however, which have been submitted, taken aggregately, will for a long time to come rather augment than decrease the public revenue.

There is little room to hope that the progress of manufactures will so equally keep pace with the progress of Edition: current; Page: [105] population as to prevent even a gradual augmentation of the product of the duties on imported articles.

As, nevertheless, an abolition in some instances and a reduction in others of duties which have been pledged for the public debt is proposed, it is essential that it should be accompanied with a competent substitute. In order to this, it is requisite that all the additional duties which shall be laid be appropriated, in the first instance, to replace all defalcations which may proceed from any such abolition or diminution. It is evident at first glance that they will not only be adequate to this but will yield a considerable surplus. This surplus will serve,

First. To constitute a fund for paying the bounties which have been decreed.

Secondly. To constitute a fund for the operations of a board to be established for promoting aits, agriculture, manufactures and commerce. Of this institution different intimations have been given in the course of this report. An outline of a plan for it shall now be submitted.

Let a certain annual sum be set apart and placed under the management of commissioners, not less than three, to consist of certain officers of the government and their successors in office.

Let these commissioners be empowered to apply the fund confided to them to defray the expenses of the emigration of artists and manufacturers in particular branches of extraordinary importance; to induce the prosecution and introduction of useful discoveries, inventions and improvements by proportionate rewards, judiciously held out and applied; to encourage by premiums, both honorable and lucrative, the exertions of individuals and of classes in relation to the several objects they are charged with promoting; and to afford such other aids to those objects as may be generally designated by law.

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The commissioners to render to the legislature an annual account of their transactions and disbursements; and all such sums as shall not have been applied to the purposes of their trust, at the end of every three years to revert to the treasury. It may also be enjoined upon them not to draw out the money but for the purpose of some specific disbursement.

It may, moreover, be of use to authorize them to receive voluntary contributions, making it their duty to apply them to the particular objects for which they may have been made, if any shall have been designated by the donors.

There is reason to believe that the progress of particular manufactures has been much retarded by the want of skillful workmen, and it often happens that the capitals employed are not equal to the purposes of bringing from abroad workmen of a superior kind. Here, in cases worthy of it, the auxiliary agency of government would in all probability be useful. There are also valuable workmen in every branch who are prevented from emigrating solely by the want of means. Occasional aids to such persons, properly administered, might be a source of valuable acquisitions to the country.

The propriety of stimulating by rewards the invention and introduction of useful improvements, is admitted without difficulty. But the success of attempts in this way must evidently depend much on the manner of conducting them. It is probable that the placing of the dispensation of those rewards under some proper discretionary direction where they may be accompanied by collateral expedients will serve to give them the surest efficacy. It seems impracticable to apportion, by general rules, specific compensations for discoveries of unknown and disproportionate utility.

The great use which may be made of a fund of this Edition: current; Page: [107] nature, to procure and import foreign improvements, is particularly obvious. Among these, the article of machines would form a most important item.

The operation and utility of premiums have been adverted to, together with the advantages which have resulted from their dispensation under the direction of certain public and private societies. Of this some experience has been had in the instance of the Pennsylvania Society for the promotion of manufactures and useful arts, but the funds of that association have been too contracted to produce more than a very small portion of the good to which the principles of it would have led. It may confidently be affirmed that there is scarcely anything which has been devised better calculated to excite a general spirit of improvement than the institutions of this nature. They are truly invaluable.

In countries where there is great private wealth, much may be effected by the voluntary contributions of patriotic individuals, but in a community situated like that of the United States, the public purse must supply the deficiency of private resource. In what can it be so useful as in promoting and improving the efforts of industry?

All of which is humbly submitted.

ALEXANDER HAMILTON,
Secretary of the Treasury.

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