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8. Wash. Union, Nov. 30, 1846. N. Y. Herald (weekly), May 16; June 6, 1846; June 19, 1847. Scott, Repudiation, 37, 47, 162. Green, Repudiation, 11, 18, 15. Niles, Dec. 4, 1847, p. 218. (Sévigné) Buchanan, Works, vii, 66. London Spectator, May 30, 1846. 354Welles papers. Dewey, Financial History, 245. Bolles, Financial History, 580-2. ''Journ. Mil. Serv. Instit.,'' xiv, 198.

The huge state debts were mostly due to extravagant enterprises often supported by fraudulent banking. Delinquency was in reality a salutary suspension of payments that prevented bankruptcy, but the creditors did not know this at the time, and felt little disposed to be charitable.

9. Taussig, Tariff Hist., 113-5. Niles, June 6, 1846, p. 212; Aug. 1, 1846, p. 345; Aug. 14, 1847, p. 369. Boston Atlas, Jan. 6, 1847. Ambler, Ritchie, 264. Webster, Letters, 337-9. 308Shields to Walker, Aug. 3, 1846. Sen. 105; 29, 2 (Walker to Dallas, Feb. 1, 1847). Ho. 227; 29, 1. Ho. 7; 30, 2 (Walker, report, Dec. 9, 1848). (Walker, Jarnagin) Welles papers. (Haywood) 1Allen to "Effie," July 25, 1846; 210McDuffie to Hammond, July 20, 1846. N. Y. Herald (weekly), Aug. 1, 29; Dec. 19, 1846; Jan. 29, 1848. N. Y. Globe, Jan. 9, 1847. Bankers' Mag., i, 136; ii, 74. Ho. 6; 29, 1 (Walker, report, Dec. 3, 1845). Sen. 2; 29, 2 (Id., report, Dec. 9, 1846). U.S. Stat. at Large, ix, 42, 53, 59, 106. Lalor, Cyclop., ii, 495; iii, 864. Phila. No. American, July 16, 1846.

Walker's report of December 3, 1845, enunciated and defended his tariff principles (Ho. 6; 29, 1). These were: 1, to collect only enough revenue for the economical administration of the government; 2, to have no duty higher than the lowest rate that will yield the greatest revenue (e.g. some luxuries are so easily smuggled in that a high duty would produce little); 3, below such a rate to permit discrimination, if thought desirable (e.g. less on necessaries than on luxuries); 4, to lay the maximum rate on luxuries; 5, to have only ad valorem duties; and, 6, to discriminate against no section or class of the nation. He expressed the opinions that many of the high duties were becoming prohibitive and therefore unprofitable, and that the increased risk and costs of transportation during a war would cause nearly all of them to become so. Besides, he said, "at least two thirds of the taxes imposed by the present tariff are paid, not into the treasury, but to the protected classes" (Niles, Aug. 1, 1846, p. 349). Walker also charged that the specific duties, which formed a part of the 1842 tariff, taxed most highly the cheapest articles and therefore produced relatively little (Sen. 105; 29, 2: to Dallas). It was argued by others that war would sufficiently hinder importing to make a protective tariff unnecessary (Wash. Union, May 28, 1846).

The essential idea underlying the tariff of 1846, though it was not strictly a revenuc tariff, was that it would increase the revenue by stimulating importation. But opponents argued that unless Europe should take a greatly increased quantity of our agricultural products — which there was no reason to expect — we could not pay for larger imports; while, should foreign goods be "dumped" at low prices upon our markets, American manufacturers would be ruined. Even in the year ending June 30, 1845, the balance of trade had been $7,251,589 against us, and we had exported $8,606,495 in specie (Bankers' Mag., i, 136). Under the tariff of 1842 the average rate of duty was 24 per cent; under that of 1846, 18 per cent.

One natural effect of the uncertainty caused by the new fiscal laws was to check business, but this was offset by its tendency to check speculation