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Henry Charles Carey, 1793-1879.
American publisher, writer and economist, primary theorist and one of the chief proponents of the protectionist "American System".
Originally from Philadelphia, Henry Charles Carey inherited his publishing business and his economic ideas from his father, Matthew Carey. An Irish nationalist and political refugee, Matthew Carey had emigrated to Philadelphia, and soon entered the book and publishing trade. An enthusiast of Alexander Hamilton, Matthew Carey was a leading proponent of protectionist tariffs and founded the Society for the Promotion of American Industry in Philadelphia for the purpose in the 1810s. For the next half-century, US politics were torn in repeated controversies over foreign tariffs. Industrialists from the north lobbied for high tariffs to protect the fledgling American manufacturing from competition from industrial Britain, while agrarian plantation lords from the south insisted on keeping them low, to facilitate foreign trade. The acrimonious struggle over the tariff went back and forth, frequently provoking the near-secession of states from the Union (e.g. during South Carolina's "nullificatoin crisis" of 1832).
The third child (and eldest son) Henry C. Carey joined Carey & Lea in 1814, and took over the publishing house of Carey & Lea on Matthew's retirement 1821. Henry was 28 years old at the time. In 1835, at the age of 42, Henry C. Carey and retired from business to dedicate himself to writing. Drawing from Senior, Carey's first work (1835) was an examination on the wages-fund doctrine, disputing Ricardo's assertion that higher profits can be achieved by lower wages. Carey's next work, Principles of Political Economy (1837-40) was largely conventional, and compatible with classical Ricardian theory.
Henry C. Carey resuming writing after an interruption, producing his seminal The Past, the Present and the Future in 1848, where he introduced his famous "hilliside" theory of rent. Rejecting the classical Ricardian theory, arguing that increasing agriculture moves from comparatively less fertile to more fertile lands, thereby reversing the Ricardian theory. Carey proposes the mental exercise of settlers arriving in a virgin valley, and notes that the most fertile lands, at the bottom of the valley, tend to be most cluttered with trees, vegetation, and underbrush that have to be cleared first, so early settlers tend to first cultivate the less fertile hillside, being more accessible with sparser vegetation. And will only later move, as extent of agriculture expands, to the more fertile lands in the valley. On the basis of this, Carey also rejects the Malthusian population doctrine, arguing that increasing returns to scale in agriculture will allow increasing population. Carey picked up Senior's point on decreasing fertility, and argued that eventually there would be a balance between subsistence and population.
"great law of molecular gravitation" applying an analogue of the Newtonian theory of gravitation to human society.
Carey took up his father's standard most forcefully.
Carey promoted the idea of an "American system" a combination of high tariffs, internal improvements (roads, canals, harbors, etc.), a national currency and balanced budgets that he asserted was essential for American economic development. It was held up in contrast to the " British system" of laissez faire free-trade. At least as far as foreign trade was concerned. In domestic economy, Carey was a proponent of optimistic 'harmony' doctrines, not dissimilar to liberals like Bastiat.
Unlike his father, Carey was not, however, merely a polemicist, but looked to back up his arguments with detailed economic studies and statistics. Carey initial ideas were laid out in the Principles (1837-38) which had some dissemination both in the US and abroad, and quoted approvingly on the political stage (e.g. by Henry Clay's Whigs). Carey followed it up with smaller tracts, elaborating on specific points. In older age, Carey tried to gather his ideas together in a monumental treatise, Principles of Social Science in 1858-59.
Carey attacked the principles of Adam Smith and the classical British economists as not only being inapplicable and even detrimental to the American economy, but as being wrong in themselves. Not only wrong on trade, but also wrong on population, rent, wages and value. In Past, Present & Future (1848), Carey introduced his famous "hillside" theory of cultivation, arguing that increasing the scale agriculture moves from comparatively less fertile to more fertile lands, thereby reversing the Ricardian theory. Carey proposes the mental exercise of settlers arriving in a virgin valley, and notes that the most fertile lands, at the bottom of the valley, tend to be most cluttered with trees, vegetation, and underbrush that have to be cleared first, so early settlers tend to first cultivate the less fertile hillside, being more accessible with sparser vegetation. And will only later move, as extent of agriculture expands, to the more fertile lands in the valley.
However, Carey's efforts at constructing his own alternative economic theory were not very successful, and much disparaged by economists for their vulgarity and inconsistency.. Carey's theoretical efforts seemed to be closer to the land theories of value of Cantillon and the Physiocrats. Nonetheless, Carey is mostly remembered for connecting protectionism to economic development, and usually compared to his German "nationalist" contemporary Frederick List.
Carey's high-water moment came with the passage of the Morrill Tariff in 1863, introducing protectionist tariffs in the United States. In the aftermath of the Civil War, Henry Carey urged the continuance and even increase of the tariff, and argued for a reduction in internal taxes, and the elimination of the wartime income tax.. Carey also emerged as a leading proponent of "easy money", arguing against the resumption of specie payments and the maintenance of inconvertible notes. He welcomed the depreciation of the dollar to gold as acting as an effective tariff barrier.
Carey was highly influential in his day, arguably the single most influential American economist of the 19th Century. The core of his support was among the industrialists of Pennsylvania, and the the University of Pennsylvania made Carey required reading for students.
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