"First Objection.—'That the proposed duty would be unequal in it's operation, bearing hardest upon the most commercial states, and so would press peculiarly hard upon that state which draws its chief support from commerce.'
"The most common experience, joined to the concurrent opinions of the ablest commercial and political observers, has established, beyond controversy, this general principle, 'that every duty on imports is incorporated with the price of the commodity, and ultimately paid by the consumer, with a profit on the duty itself, as a compensation to the merchant for the advance of his money.'
"The merchant considers the duty demanded by the state on the imported article in the same light with freight, or any similar charge, and, adding it to the original cost, calculates his profit on the aggregate sum. It may happen that, at particular conjunctures, where the markets are overstocked, and there is a competition among the sellers, this may not be practicable; but in the general course of trade, the demand for consumption preponderates, and the merchant can with ease indemnify himself, and even obtain a profit on the advance. As a consumer, he pays his share of the duty; but it is no further a burden upon him. The consequence of the principle laid down is, that every class of the community bears its share of the duty in proportion to its consumption, which last is regulated by the comparative wealth of the respective classes, in conjunction with their habits of expense or frugality. The rich and luxurious pay in proportion to their riches and luxury; the poor and parsimonious, in proportion to their poverty and parsimony. A chief excellence of this mode of revenue is, that it preserves a just measure to the abilities of individuals, promotes frugality, and taxes extravagance. The same reasoning, in our situation, applies to the intercourse between two states; if one imports and the other does not, the latter must be supplied by the former. The duty, being transferred to the price of the commodity, is no more a charge on the importing state for what is consumed in the other, than it is a charge on the merchant for what is consumed by the farmer or artificer. Either state will only feel the burden in a ratio to its consumption, and this will be in a ratio to its population and wealth. What happens between the different classes of the same community, internally, happens between the two states; and as the merchant, in the first case, so far from losing the duty himself, has a profit on the money he advances for that purpose, so the importing state, which, in the second case, is the merchant with respect to the other, is not only reimbursed by the non-importing state, but has a like benefit on the duty advanced. It is, therefore, the reverse of a just position, that the duty proposed will bear hardest on the most commercial states: it will, if any thing, have a contrary effect, though not in a sufficient degree to justify an objection on the part of the non-importing states; for it is as reasonable they should allow an advance on the duty paid as on the first cost, freight, or any incidental charge. They have also other advantages in the measure fully equivalent to this disadvantage. Over-nice and minute calculations, in matters of this nature are inconsistent with national measures, and, in the imperfect state of human affairs, would stagnate all the operations of government. Absolute equality is not to be obtained; to aim at it, is pursuing a shadow at the expense of the substance; and in the event we should find ourselves wider of the mark than if, in the first instance, we were content to approach it with moderation.
"Second Objection.—‘That the recommendation proposes to introduce
