tion, which, being the same for the United States and for us, is also especially near to mauufacturers and merchants, and therefore a fit subject for mention on the present occasion: the manufacturing interests of the United States, as well as our own, demand at the present time a protective tariff. Our merchants and the producers of the United States are in favor of it, not from obstinacy nor because they are led away by false theories. The question of protective systems, and unconditional free trade, has long furnished themes for dispute between localities needing foreign raw materials for manufactures, and those more favored lands abounding in agricultural products, which can and should widely develop home manufactures.

"These countries, gentlemen, are Russia and the native land of our guests; they both possess similar means of development, and for that reason serve as an object of attack for the theorists of the whole world. But, unfortunately, disputes of this kind do not remain theories. In one form or another the question of protecting internal productions has become at the present time a vital one for the manufacturing population of both America and Russia. You are aware that, for nearly a year, a permanent committee of merchants has been occupied in preparing an answer to the proposition of the German Zollverein in regard to a commercial treaty with Russia. During all this time I have taken part personally in the preparation of the various data in all branches of Russian manufactures. Our task is done. The result of our investigations is before the public.

"In the course of this year I have often thought of the inductions which are inevitable upon an examination of the various data contained in this collection of facts concerning our Russian manufactures.

"I consider myself fortunate in being able to express the inductions which I have made, and in the truth of which I firmly believe, in the very words of an author renowned in the literature of American political economy.

"Theorists have condemned our country to exclusively agricultural labor, to the production of raw materials, just as they have the United States. "But where there are no manufactures,' says Carey, the farmer will always be the victim of chance, and the ruinous fluctuations of prices.' Increase of internal manufacture, variety of occupations, the bringing together of producer and consumer, are what Carey demands for assuring to the farmer a regular compensation for his products; this he demands as a protection against destructive mercantile crises. In a rational protective system, he sees the only means for the development of prosperity in the laboring class for the payment of the immense foreign debt of the United States; salutary demands, which may be repeated without change in Russia. "The Russian merchants and manufacturers can say nothing more appropriate than this in defence of our home manufactures. It is painful to think of the future which would have awaited Russia and America, had they been limited to the production of raw materials for foreign factories. Of what use is a fertile soil and a boundless territory, if the trade in grain and other agricultural products is languishing on account of the difficulty of transport and the slow movement of capital? In America, according to Carey, the owners of railroads leading from the west suffer a continual loss in the transport of grain for the only purpose of giving the western farmer an opportunity of sending his grain to the eastern markets, and balance these losses by the profit on other classes of freight. With us, in Russia, where there are still few railroads, the farmer, for the greater part, sells his grain at a loss, if we count the actual cost of its production, and it is only at such prices that the dealer is able to transport it to the seaboard. The situation is the same, with the single exception that the losses, in every case, ruinous for those upon whom they fall, are borne by dif ferent persons.

With us the quality of raw products needs improvement, and in North America, says Carey, the development of a home market is indispensable for improving the products of the country.

"The yearly influx of emigrants to the United States in search of an occupation, who, not finding it, betake themselves to agriculture, causes a great competition in the production of raw materials. In Russia, at the present time, the eleven millions of newly freed rural population cannot devote all their unoccupied time to agricultural labor; in summer there is work enough for all; but in the long winter months, they are, for the most part, condemned to involuntary idleness. Thus we see there are many similarities in the position of national labor in both countries. In relation to the United States, Mr. Carey very justly considers the adherents of unconditional free trade as the allies of England, striving to make her the workshop of the world, in order to manufacture our raw materials, and send back to us again the products of our own fields at a price a hundredfold more than we received for them. Even our continental neighbors have begun to offer their services, which, unfortunately, we Russians cannot consider as entirely unselfish, at least as regards the propositions of the Zollverein, of which I have already spoken.

"Pardon me, gentlemen, if I have occupied too much of your time in the consideration of a subject important to us all.

"Permit me to offer a toast, which follows as a natural conclusion from what I have saida toast for the protection and development of home manufactures, in Russia and in the United States, and for direct mercantile relations between the markets of both countries. But this is impossible without ships. Allow me to add a third toast: Let us drink to the restoration

of the merchant fleet of the United States, and the establishment of a similar fleet in our dear God-preserved Russia."

General Clay answered Mr. Chetverikoff in the following speech, which was heartily applauded by all the hearers:

"GENTLEMEN: In natural science, man is the highest type of animal organization; his structure and growth are, of all, the most intricate and interesting. How much more intricate the growth and structure of a nation which groups together so many human beings! Statesmanship is the most profound of all sciences, and the most noble of all arts. Most aptly have the resemblances of Russia and America been set forth in the graphic remarks which we have just heard. There are among nations as among individuals, personal and general interests. And, as in municipal organizations, the interest of each is forwarded by the advancement of all, so each nation has a common share in the welfare of all the nations. The development of the nation comes from that of the individuals, so must the development of a common civilization come from the growth of each people.

"The first want of a nation is the development and the protection of labor, which is the basis of all its other wants. Intellect and science are as powerful in commerce as in war. A single chemist with his blow-pipe, a solvent, some sand and coloring matter, makes enough brilliant gewgaw to buy most of the furs and other raw materials produced by the labor of a whole tribe of savages. The producer uses the one-man power, the manufacturer the million-man power, of steam, electricity, chemistry, and all the natural forces. It is not now worth while for France and England to preach the gospel of free trade' to Russia and America Timeo Danaos et dona ferentes. As you have truly said, there were no stricter defenders of protective tariffs than France and England, till they became the workshops of the world. Now, having the accumulated capital and skill of ages, powerful to break down by flooding the market with temporarily cheap goods the infant manufactories of other countries, they have become suddenly the advocates of free trade. The manufacturing chemists want to keep in perpetual serfdom us savages of two continents. We raise the cotton and the tobacco. England and France desire to manufacture them into thread, calicos, laces, and into snuff and cigars, and then, over a quarter of the earth's surface, to return them to us at ten times and a hundred times the price at which the raw materials were originally sold by the planter. Let us take the single article of cotton and follow up this process by which England, an insignificant isle, has become the centre of the capital, the exchanges, and the commerce of the world The pound of cotton is grown in Louisiana, in the United States; it is ready for the spindle, but the spindle is in Manchester, England. The pound of cotton goes by wagon to the nearest steamboat landing or railroad depot, and pays freight. Here it goes into a warehouse, and into the hands of a factor or commission merchant; it pays drayage, insurance, storage, and commission. It now sets out again for some seaport town having shipping communication with Liverpool, and pays again all these enumerated charges and freight; and after again repeating the same routine it reaches the manufacturer at Manchester. There it is spun, woven, and colored; and then, after duplicating all these before-named charges, and adding on the cost of manufacturing, after months or years the same pound of cotton reaches the planter in Louisiana, increased ten and ten hundred times in price. Now, put the cotton mills and looms alongside of the planter, and does not every one see that all these charges, except the single cost of the manufacturing, is saved to the producer? And should the planter become manufacturer, the whole of these profits and costs are saved to the country, which would otherwise go to the foreign insurance company, the ship-owner, the railroad company, the commission merchant, the banker, and the manufacturer. And what has been said of the pound of cotton applies also to the bushel of wheat; and the farmer and the cotton grower, under free trade, sell at the lowest price, and buy at the highest price. By bounties or a tariff upon all articles of foreign manufacture made of raw materials of home growth, you transfer the factories to your own country and build up your own industries and obey the laws of common-sense. Under the leadership of my distinguished relative, Henry Clay, upon these principles was built up the American system,' so-called in opposition to the free traders, who were the real defenders of British interests. So that, by the protective tariff, we have become the rivals of England, not only in our own markets, but in all the world.

"In consequence of the existence of slave labor in the south our tariff system benefited only the free States, and the south continued to be only producers of the raw materials till the breaking out of the rebellion. The consequence was that a four years' war ruined the south, while the north remains, at the end of it, as flourishing as at the beginning. The true policy is not to declare absolutely for free trade' or 'protection,' but to subject both systems to a wise statesmanship. As a general rule every. nation should manufacture its own raw products into the highest forms of value, and then export them to foreign countries; that is the trade which, being most useful to each, would best promote the common interests of all the nations.

"What I regard as proper objects of free trade are what we cannot produce or manufacture at home. I would take my ermine from Russia, my figs from Smyrna, my tea from China my pepper from Java, my silks from Italy, my truffles from France, and my philanthropic lectures from England. What America wants is universal education and equality before the

law. We want railroads and canals and freedom of interior commerce. From these will come skilful labor, manufactures, scientific agriculture, a dense population, accumulated capital, and a profitable foreign commerce. Of these will come plenty in peace and power

in war.

"For Russia, under different social and political forms, remain the same principles, and a similar policy, and the same destiny. My aspirations are for her continued growth from the roots of her long-planted civilization.

"One God, one government, one language, and one undivided nation forever!"

At the conclusion of Mr. Clay's speech, Mr. Chijoff, one of the invited guests, made the following remarks:

"GENTLEMEN: Thanking you most sincerely for having invited me to the present dinner in honor of our esteemed guests, I beg your permission to say a few words concerning the similarities of their great country and ours. These similarities have often been remarked. They are so numerous and so significant that De Tocqueville, upwards of thirty years ago, on one of the last pages of his famous work, "Democracy in America," pointed to Russia and America as the two colossi destined to solve the great problem of the future; and of a truth we have much in common which belongs to us alone.

"Both we and the United States have increased and grown to gigantic size without foreign aid. Europe looks upon us both with an unfriendly eye, while neither Russia nor America have ever coveted an inch of her territory, nor thought of violent interference in her politics. We have never made demand upon her nor asked of her a favor. We Russians and Americans give a hospitable asylum to her overflowing population; we share with her our granaries, and give her a market for her luxuries.

"Having been the editor of a journal devoted to political economy, I have been most struck with the similarity of ideas upon this science in both Russia and America.

"Many of us, yielding to the influence of the doctrines of western Europe, proclaim a complete cosmopolitanism in manufactures and commerce, forgetting that with us the conditions of labor are more difficult, on account of climate, sparse population, and immense distances, so that knowledge is acquired at a much higher price. We find that it is impossible to leave this costly labor without protection from labor much cheaper. And it is impossible and unjust to condemn our laboring brethren to be the bewers of wood and drawers of water for Europe, according to the friendly advice of our neighbors.

"Europe furnishes both Russia and America not with the necessaries but the luxuries of life, consequently if we are blinded by her teachings we oppress our laborers for the pleasure of a small class who know neither want nor the suffering of never-ending toil.

"Having been a servant of science from my youth, I desire here to make an explanation. Science is not at fault, nor European teachings, but we ourselves. Political economy as a science grew up on the soil of western Europe, and generalized her laws from the phenomena of western European life. Appearing upon the virgin soil of two immense countries, she had to deal with new elements. It is our duty to apply her laws to the new situation, and not slavishly to subject ourselves to the teachings of others. I will not enter into an explanation of the causes of our subjection. Europe, from the time of the middle ages, by means of the strictest trade regulations and by Draconian laws for the protection of labor, stopping neither at the cutting off of hands nor even at the death penalty itself, succeeded in bringing manufactures to a high degree of technical perfection.

"The people of the United States and of Russia proceed more simply, and dispense with these harsh measures; and God grant that, without the past cruelties of Europe, we shall attain the same results by the simple protection of home labor. To the honor of America be it said, that the learned Carey has shown most clearly and convincingly that the highest and truest indications of science are to be attained not by slavish submission to theory, but by a profound consideration of the wants of national labor. While Europe and her adherents on both hemispheres looked with ridicule and contempt on our protection of home labor, commerce, and manufactures, she, not unmindful of her own interests, demanded of America and of us complete submission to her so-called free trade. Against these demands the American Carey boldly raised the banner of protection for home labor of every description. Thank God this banner is winning more and more adherents every day, and bringing the so-called free traders on both continents to their senses. They are beginning to see in the manufacturer and tradesman not a heartless egotist, sacrificing everything to his own gain, but an active and genuine promoter of his country's interests.

64

To the American scholar Carey, whom we had the pleasure of seeing among us a few years ago, belongs the honor, if not of raising this banner, of supporting it most efficiently and successfully; and the last American tariff is a national recognition of the benefits of Mr. Carey's teachings.

"Gentlemen, I propose a toast to the health of Mr. Carey, as the able defender of home labor in all its forms."

Mr. Axenhoff, a Moscow manufacturer, called attention to the other side of the question in the following speech:

"GENTLEMEN: So much has already been said that I am afraid to exhaust your patience, but I beg you will allow me one moment. We have just drunk the health of Mr. Carey, as an

advocate of the protective system; but allow me, gentlemen, to say that Mr. Carey considers this system a mere temporary measure, as a means to develop home industry; here occurs to me another authority-one nearer home-one of the guests of the present dinner-a member of the committee which has framed the answer to the proposition of the Zollverein one of our leading manufacturers, the esteemed Mr. Morogoff. A few days ago, in conversation, he gave utterance to the following maxim: 'A tariff should serve as a barometer of the development of manufactures in a country.'

"Supported by these two authorities, a theoretical one abroad, and a practical one at home, I offer a toast, with the wish that Russia and America may attain such an industrial development that, instead of fearing, they shall desire free trade."

The long series of speeches was closed by the following toast from Mr. Yakunachikoff, president of the council :

GENTLEMEN: After many toasts and greetings, I beg your attention for one moment. The present festival is inseparably connected with the place where our children are educated. We are within the walls of the Mercantile Academy, an institution which, like the schools of the United States, is supported by private means.

"Devoted to this institution from a sense of duty and from feelings of affection, I value the present rare moment, which affords us an opportunity to give our best wishes for the success of commercial education.

"Gentlemen, I propose a toast for the success and progress of commercial education in the national spirit, on sound principles, for the good of our country."

After these words, pronounced with much spirit, and received with hearty applause, Mr. Gorboff asked permission to fill the glasses once more, and said:

"Gentlemen, we have finished all the toasts proposed, but there still remains one obligatory on us all in the present moment. Having said so much about protection of industry, accumulation of wealth, extension of commercial relations, and building of fleets, we, sitting here, without care or sorrow at the present happy moment, in this hall so beautifully warmed and lighted, should not forget those by whose toil-hardened hands our wealth is collected, our wares manufactured, our fleets and cities built, and all the material wonders of civilization created. My toast is as follows: Let us raise our glasses, flowing to the brim, and with one soul and one heart, let us wish uninterrupted and general improvement in the condition of the toiling laborers of all the world, no matter to what nation they may belong." The sentiment of this toast touched the heart of the hearers, and a burst of applause eloquently expressed the sympathy of all.

About 8 o'clock the guests began to leave the table, when suddenly their attention was arrested by Mr. Chijoff, who repeated the greeting of the late Mr. Aksakoff to Moscow, in verse. So great was the satisfaction of the hearers, that he was obliged to give it a second

time.

The short interval between dinner and the departure of the guests was employed in listening to a few national songs, sung by the choir of Molchanoff.

Our national songs so pleased General Clay that he requested that both songs and music be given him.

On the General's departure from the hall an album of photographic views of Moscow and the history of the Moscow Practical Academy of Commercial Science were presented to him.

Mr. Clay to Mr. Seward.

No. 100.]

LEGATION OF THE UNITED STATES,

St. Petersburg, February 7, 1866. SIR: Your despatch No. 183, enclosing letters to the governor elect and to the provisional governor of Alabama, is received, and they have all been read with great pleasure.

Whilst no one would have been more pleased than myself to see the question of negro and all other suffrage finally settled, I am forced to believe that the President is following a legitimate and necessary policy in allowing the return of the rebel States into the Union so soon as they purge themselves of treason. I have always held, as you know, that rebellion could not destroy a State except by successful revolution, and armed force being suppressed, the original status quo revives.

I claim to have conceived and expressed this idea by the dictum that "if one loyal citizen remained, he is the State." The Union once restored, we may

safely leave subordinate issues to time and to the good sense of the American people.

Trusting that the President may succeed in the pacific and legal policy which he has, thus far, so successfully initiated, I should yet deem it a mistake if some eminent example was not made of those who have attempted in our system State rights, secession, and Mexican pronunciamientos.

I am, sir, your most obedient servant,

Hon. WILLIAM H. SEWARD,

Secretary of State, Washington, D. C.

C. M. CLAY.

Mr. Clay to Mr. Seward.

No. 101.]

LEGATION OF the United STATES,

St. Petersburg, Russia, February 7, 1866.

SIR: Your despatch No. 184 is received, together with the report of the Secretary of the Treasury. I have read with great interest Mr. McCulloch's able report, for which his Fort Wayne speech had already prepared me. His views are, in my opinion, rigidly correct, and I shall regard it as a great misfortune if Congress does not at once carry out his policy. The currency must be reduced till it comes to par with gold. And I am also in favor of taxation and redemption of principal and interest of our debt by immediate and steady effort. I dissent only from the Secretary's idea that our bonds should not be held abroad.

In old countries, where production has reached its maximum, a large foreign debt, especially for unproductive expenditures, would be oppressive, if not ruinous. But in our country, full of undeveloped resources, capital borrowed at something like six per centum per annum could be employed in reproductive expenditure for some centuries, yet, perhaps, with eminent advantage to our whole people; for that is one reason I desire to see the Secretary's policy carried out. Our credit would be at once established in Europe, and an immense number of our bonds would be still taken here. As we have been fortunate in our generals, so now we may pride ourselves upon our finance ministers. I am sure S. P. Chase was the right man for the war expenditures, as H. McCulloch will prove to be the right man for the peace establishment.

I am, sir, your

obedient servant,

Hon. WILLIAM H. Seward,

Secretary of State, Washington, D. C.

C. M. CLAY.

Mr. Clay to Mr. Seward.

No. 102.]

LEGATION OF THE UNITED STATES,

St. Petersburg, Russia, February 22, 1866.

SIR: I take the liberty of sending you a report of the anniversary dinner (18th of February instant, translated from the French of the St. Petersburg Journal, the official paper of to-day) of the Marine Assembly. Mr. J. Curtin and myself were informally invited, but the whole proceeding, I understand, was approved by his imperial Majesty the Grand Duke Constantine.

I have the honor to be, sir, your most obedient servant,

Hon. WILLIAM H. SEWARD,

Secretary of State, Washington, D. C.

C. M. CLAY.

P. S.-This society is a regulation assembly of the whole marine.

CLAY.