unless by a special act of Congress. Moreover, unless a vessel is officered by Americans it cannot fly the American flag. Vessels engaged in foreign commerce must as a rule pay into the federal treasury an annual tonnage tax-a tax on the carrying capacity estimated in tons-but this tax is made to fall more heavily on foreign vessels than on those registered as American. Foreign vessels cannot engage in the coasting trade, or in trade between the United States and its insular possessions. For the benefit of commerce as well as for the saving of human life the federal government supports the life-saving service which patrols the coast and sends out life-boats and throws out life-lines to save the passengers and cargoes of vessels in distress.

The Regulation of Immigration. Since passengers as well as goods are included in the term commerce, immigration is regulated by Congress. During the greater part of our history we encouraged immigration, for in the development of our country we needed all the brain and muscle we could get. Had it not been for the millions of immigrants who have come to us from England, Ireland, Scotland, Germany, Norway, Sweden, France, Italy, a large part of our country would still be a wilderness.

About 1880 Americans began to feel that immigration on a large scale was no longer desirable, and demanded that restraints be placed upon the admission of foreigners. First the Chinese were excluded. In 1882 Congress, in defiance of a treaty with China, prohibited Chinese laborers from coming into the United States, and but few of these people have entered since the exclusion law was passed. In the same year Congress ordered that the character of all immigrants be looked into and commanded that convicts, lunatics, idiots and other persons not able to take care of themselves should not be admitted into the United States, but should be sent back at the expense of the owners of the vessels upon which they came.

By

a law of 1885 it is made unlawful for certain classes of laborers to enter the United States, if they have previously entered into a contract to perform labor here, and any person brought here under a contract to perform labor can be sent back at the expense of the vessel which brings him here. As a further hindrance to immigration the tax imposed on immigrants has been increased from fifty cents per head to two dollars per head. These restrictive laws have had the effect of checking immigration to some extent, but they have by no means solved the immigration problem: they have by no means been successful in keeping out all undesirable foreigners and letting in only those whose presence is beneficial.

QUESTIONS ON THE TEXT

1. How is power in respect to commerce divided?

2. What is the extent of the power which Congress has over foreign commerce?

3. What is meant by free trade? by protection? Give the leading argument for free trade; for protection.

4. Sketch the course of tariff legislation in the United States.

5. What may be learned from the history of our tariff?

6. What regulation has Congress made in respect to foreign shipping?

7. Give an account of our immigration policy.

SUGGESTIVE QUESTIONS AND EXERCISES

1. Name the articles of commerce which can be easily produced in the United States. Name those articles which cannot be easily produced.

2. Compare graphically the volume of the commerce of the United States with that of each of the leading countries of the world. (See "Review of World's Commerce' issued by the Bureau of Foreign Commerce; also "Statesman's Year Book.")

3. What class of business men suffer when the tariff is suddenly raised when it is suddenly reduced?

4. What is meant by reciprocity? What are subsidies? bounties? 5. To what four countries do we sell the most? From what four countries do we buy the most?

6. What do you think should be the policy of the United States in reference to immigration?

7. What is the present policy of each of the political parties in reference to the tariff?

8. In what way will the Panama Canal be likely to benefit the foreign commerce of the United States?

Hints on Reading.-Bastable, "The Theory of International Trade"; Taussig, "Tariff History of the United States"; Stanwood, American Tariff Controversies."'

XLIV

DOMESTIC COMMERCE

Interstate and Intrastate Commerce. Domestic commerce is that which is carried on within the United States, and consists of interstate commerce and intrastate commerce. It is not easy to draw clearly the line which separates interstate from intrastate commerce. Broadly speaking, when a commercial transaction begins in one State and ends in another, that transaction is a subject of interstate commerce, but when a commercial transaction begins and ends in the same State it is a subject of intrastate commerce. When a merchant ships his goods to a point within a State he engages in intrastate commerce; when he ships them to a point outside of the State he is engaged in interstate commerce. A railroad which has its termini and the whole length of its tracks within the State cannot be regarded as being engaged in interstate commerce, but a railroad which has its termini in different States must be so regarded. A river lying wholly within a State and having no connection with bodies of water extending beyond the boundaries of the State-a thing which rarely ever occurs-is an instrument of intrastate commerce, but a river wholly within a State connecting with navigable waters that extend beyond the boundaries of the State is regarded as an instrument of interstate commerce. Does a certain commercial act or a certain instrument of commerce, a river, a canal, a railroad, concern one State or more than one? If it concerns one State only it is an affair

of intrastate commerce; if it concerns more than one State it is an affair of interstate commerce.

The Regulation of Interstate Commerce. During the period of the Confederation, commerce between the States was subjected to many inconveniences and burdens. Goods brought into one State from another were treated as if they were goods from a foreign country. When the New Jersey farmer carried his produce to New York he was met by the tax-collector and compelled to pay a tax upon what he had to sell. When a vessel from Baltimore sailed into the harbor of Boston its master was liable to be called upon to pay tonnage before unloading his cargo. We have seen (p. 46) that it was unsatisfactory trade relations between Virginia and Maryland that led to the calling of the Annapolis Convention, and that this led to the calling of the Constitutional Convention of 1787.

The men of the convention treated the whole subject of commerce with a firm hand. They gave to Congress complete power to regulate commerce between the States (47). They forbade a State to lay tonnage (76) or any export or import duty without the consent of Congress (74). Within its borders a State can regulate its commerce in its own way, but goods and passengers that are on their way from one State to another are placed under the regulation of the federal government.

The power of Congress over interstate commerce is comprehensive and far-reaching. It extends to the instruments of commerce,-to canals and vessels and railways and telegraph lines, and to the persons engaged in it, as well as to the articles of commerce themselves. Under the provisions of the interstate commerce clause a State is not permitted to discriminate by taxation or otherwise against residents of other States, or against business carried on by them in the State. A State can interfere with interstate traffic only so far as it may be necessary to exercise its police power (p. 390).