e by the tariff while the price of the finished product is
considerably raised, or _vice versa._

Sec. 4. #The tariff, 1789-1815.# The main difficulty of government in
1781-1789 under the Articles of Confederation was lack of the power
to obtain revenues by taxation. The separate states alone could levy
duties, and a good many tariff restrictions on freedom of trade
among them developed in this period. The Constitution established the
principle of entire freedom of trade among the states. The first act
of Congress under the Constitution levied a tariff, primarily for
revenue purposes, but clearly having a protective purpose, in the view
of some of the representatives. However, most of the separate rates,
as well as the general average rate, were the lowest ever levied by
Congress, except that there was no free list and that 5 per cent was
imposed upon all goods not otherwise enumerated. _Ad valorem_ duties
up to a maximum of 15 per cent (that on carriages) were laid upon
certain articles of luxury, and low specific duties on a few articles
such as glass, nails, iron manufactures, hemp, and cordage.

From 1789 until 1812, thirteen tariff laws, all told, were passed. One
after another many rates were raised to get larger revenues, but some
goods were put upon the free list. The foreign trade, in both imports
and exports, grew largely and with considerable regularity, rising
then rapidly to a maximum in 1807. Then followed troublous times,
with British Orders in Council and our embargo and nonintercourse
acts until 1812, and war until 1815, trade falling off at first to
one-half, and at last (in 1814) to less than one-twelfth of the
former maximum. Just as trade was, in the war period, sinking to the
vanishing point, the tariff rates were doubled in hopes of getting
increased revenues needed for the war, but in vain.

[Illustration: FIG. 3. IMPORTS INTO THE UNITED STATES. 1821-18565

Many statistics bearing upon tariff history are graphically brought
together here. This figure should be carefully studied in connection
with the following sections. Observe how invariably in the years
following a crisis, the amounts of dutiable imports and of duties
collected have diminished, whether the tariff meantime was changed or
not.]

Sec. 5. #The tariff, 1816-1845.# Tho rates had been rising, manufacturers
had been making efforts to secure higher rates for protection, even
as early as 1803. Effectual exclusion of foreign goods an