Economics Volume II: Modern Economic ProblemsFetter, Frank A. (Frank Albert)
General
Economics Volume II: Modern Economic Problems
Fetter, Frank A. (Frank Albert)
Economics
§ 8. #The claim that protection raises wages.# The most effective
popular claim made for protection is that it raises, or maintains, the
general scale of wages in the country. This argument takes two forms:
first, when wages are low in a country it is claimed that a tariff is
needed to raise them; and, secondly, when wages are high it is argued
that a tariff alone can preserve them. In Germany the fear is of the
higher paid and more efficient labor of England. In America, where
general wages at all times have been higher than in England, it was
first argued (in the time of Henry Clay) that because of the greater
cost of production, due to high wages, the tariff was needed to start
certain industries; but after the tariff had long been established
and the old argument had been forgotten (ever since 1865), it has
been urged that the tariff, being the cause of high wages, must
be maintained to protect against the "pauper" labor of the older
countries. The higher wages in new countries where a tariff exists are
always claimed to be the fruits of a protective policy. The true
cause of the high general scale of wages in America is the greater
efficiency of industry under existing conditions.[8] Labor is
surrounded here with advantages in the forms of rich natural resources
and of mechanical appliances such as never before were combined.
Because of the scarcity of workers in particular protected industries,
wages may be temporarily higher in them than in some other industries;
but such workers form a small fraction of the population, and it is
impossible to show that the general scale of wages in all occupations
is raised by the tariff protecting this fraction.
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