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75-697: The Walker Tariff was a set of tariff rates adopted by the United States in 1846. Enacted by the Democrats , it made substantial cuts in the high rates of the " Black Tariff " of 1842, enacted by the Whigs. It was based on a report by Secretary of the Treasury Robert J. Walker . The Walker Tariff reduced tariff rates from 32% to 25%. Coinciding with Britain's repeal of the Corn Laws , it led to an increase in trade and

150-445: A "domestic manufacture has attained to perfection… it invariably becomes cheaper. In this report, Hamilton also proposed export bans on major raw materials, tariff reductions on industrial inputs, pricing and patenting of inventions, regulation of product standards and development of financial and transportation infrastructure. The U.S. Congress adopted the tariffs but refused to grant subsidies to manufactures. Hamilton's arguments shaped

225-464: A common myth about United States trade policy is that low tariffs harmed American manufacturers in the early 19th century and then that high tariffs made the United States into a great industrial power in the late 19th century. A review by the Economist of Irwin's 2017 book Clashing over Commerce: A History of US Trade Policy notes: Political dynamics would lead people to see a link between tariffs and

300-426: A nation by replacing imported goods with domestic production). Tariffs may also be used to rectify artificially low prices for certain imported goods, due to 'dumping', export subsidies or currency manipulation. There is near unanimous consensus among economists that tariffs are self-defeating and have a negative effect on economic growth and economic welfare, while free trade and the reduction of trade barriers has

375-503: A notion believed by some to offer lessons for developing countries today. As its share of global manufacturing powered from 23% in 1870 to 36% in 1913, the admittedly high tariffs of the time came with a cost, estimated at around 0.5% of GDP in the mid-1870s. In some industries, they might have sped up development by a few years. But American growth during its protectionist period was more to do with its abundant resources and openness to people and ideas. The Economist Ha-Joon Chang argues, on

450-400: A positive effect on economic growth . Although trade liberalisation can sometimes result in large and unequally distributed losses and gains, and can, in the short run , cause significant economic dislocation of workers in import-competing sectors, free trade has advantages of lowering costs of goods and services for both producers and consumers. The economic burden of tariffs falls on

525-501: A protective tariff, and we will have the greatest nation on earth" . Once elected, Lincoln implemented a 44-percent tariff during the Civil War —in part to pay for railroad subsidies and for the war effort, and to protect favored industries. After the war, tariffs remained at or above wartime levels. High tariffs were a policy designed to encourage rapid industrialisation and protect the high American wage rates. The policy from 1860 to 1933

600-589: A role in the subsequent contraction." As of 2011, Milton Friedman held the opinion that the tariffs of 1930 caused harm but were not responsible by themselves for the Great Depression, which instead he blamed the lack of sufficient action on the part of the Federal Reserve. Peter Temin , an economist at the Massachusetts Institute of Technology, agrees that the contractionary effect of the tariff

675-532: A speech in the House of Lords in which he defended fiscal retaliation against countries that applied high tariffs and whose governments subsidised products sold in Britain (known as "premium products", later called " dumping "). The retaliation was to take the form of threats to impose duties in response to goods from that country. Liberal unionists had split from the liberals , who advocated free trade, and this speech marked

750-533: A turning point in the group's slide toward protectionism . Lansdowne argued that the threat of retaliatory tariffs was similar to gaining respect in a room of gunmen by pointing a big gun (his exact words were "a gun a little bigger than everyone else's"). The "Big Revolver" became a slogan of the time, often used in speeches and cartoons. In response to the Great Depression , Britain abandoned free trade in 1932, recognizing that it had lost production capacity to

825-401: Is declining...faster than international trade is declining." If this decrease (in international trade) had been the cause of the depression that the countries have experienced, we would have seen the opposite". "Finally, the chronology of events does not correspond to the thesis of the free traders... The bulk of the contraction of trade occurred between January 1930 and July 1932, that is, before

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900-438: Is for citizens to buy local products instead, thereby stimulating their country's economy. Tariffs therefore provide an incentive to develop production and replace imports with domestic products. Tariffs are meant to reduce pressure from foreign competition and reduce the trade deficit. They have historically been justified as a means to protect infant industries and to allow import substitution industrialisation (industrializing

975-757: The French : tarif , lit.   'set price' which is itself a descendant of the Italian : tariffa , lit.   'mandated price; schedule of taxes and customs' which derives from Medieval Latin : tariffe , lit.   'set price'. This term was introduced to the Latin-speaking world through contact with the Turks and derives from the Ottoman Turkish : تعرفه , romanized :  taʿrife , lit.   'list of prices; table of

1050-636: The National Bureau of Economic Research highlights the predominant influence of currency instability (which led to the international liquidity crisis ) and the sudden rise in transportation costs in the decline of trade during the 1930s. Other economists believe that the record tariffs of the 1920s and early 1930s adopted by the Republicans exacerbated the Great Depresssion in the U.S., in part because of retaliatory tariffs imposed by other countries on

1125-550: The Whig Party under the name " American System " which consisted of protecting industries and developing infrastructure in explicit opposition to the "British system" of free trade. Before 1860 they were always defeated by the low-tariff Democrats. From 1846 to 1861, American tariffs were lowered but this was followed by a series of recessions and the 1857 panic, which eventually led to higher demands for tariffs than President James Buchanan signed in 1861 (Morrill Tariff). During

1200-605: The repeal of the Corn Laws in 1846, which was equivalent to free trade in grain. The Corn Acts had been passed in 1815 to restrict wheat imports and to guarantee the incomes of British farmers; their repeal devastated Britain's old rural economy, but began to mitigate the effects of the Great Famine in Ireland. Tariffs on many manufactured goods were also abolished. But while free-trade was progressing in Britain, protectionism continued on

1275-690: The American Civil War (1861–65), agrarian interests in the South were opposed to any protection, while manufacturing interests in the North wanted to maintain it. The war marked the triumph of the protectionists of the industrial states of the North over the free traders of the South. Abraham Lincoln was a protectionist like Henry Clay of the Whig Party, who advocated the "American system" based on infrastructure development and protectionism. In 1847, he declared: "Give us

1350-643: The American producer. It upholds the American standard of wages for the American workingman". In 1913, following the electoral victory of the Democrats in 1912, there was a significant reduction in the average tariff on manufactured goods from 44% to 25%. However, the First World War rendered this bill ineffective, and new "emergency" tariff legislation was introduced in 1922 after the Republicans returned to power in 1921. According to economic historian Douglas Irwin,

1425-560: The Black Tariff in 1845 to almost $ 45 million annually by 1850. It also improved relations with Britain that had soured over the Oregon boundary dispute . It was passed along with a series of financial reforms proposed by Walker including the Warehousing Act of 1846. The 1846 tariff rates initiated a fourteen-year period of relative free trade by nineteenth century standards lasting until

1500-686: The Civil War even more explicitly protectionist than before, Germany under Bismarck rejected free trade, and the rest of Europe followed suit. After the 1870s, the British economy continued to grow, but inexorably lagged behind the protectionist United States and Germany: from 1870 to 1913, industrial production grew at an average annual rate of 4.7% in the USA, 4.1% in Germany and only 2.1% in Great Britain. Thus, Britain

1575-768: The Depression, partly as a consequence of deflation." According the historian Paul Bairoch , the years 1920 to 1929 are generally misdescribed as years in which protectionism increased in Europe. In fact, from a general point of view, the crisis was preceded in Europe by trade liberalisation. The weighted average of tariffs remained tendentially the same as in the years preceding the First World War: 24.6% in 1913, as against 24.9% in 1927. In 1928 and 1929, tariffs were lowered in almost all developed countries. Douglas A. Irwin says most economists "doubt that Smoot–Hawley played much of

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1650-518: The East Asian countries, he argues that the longest periods of rapid growth in these countries do not coincide with extended phases of free trade, but rather with phases of industrial protection and promotion. He believes infant industry protection policy has generated much better growth performance in the developing world than free trade policies since the 1980s. In the second half of the 20th century, Nicholas Kaldor takes up similar arguments to allow

1725-558: The European mainland and in the United States. Customs duties on many manufactured goods were also abolished. The Navigation Acts were abolished in 1849 when free traders won the public debate in the UK. But while free trade progressed in the UK, protectionism continued on the Continent. The UK practiced free trade unilaterally in the vain hope that other countries would follow, but the USA emerged from

1800-821: The Second World War. In Report on Manufactures , considered the first text to express modern protectionist theory, Alexander Hamilton argued that if a country wished to develop a new activity on its soil, it would have to temporarily protect it. According to him, this protection against foreign producers could take the form of import duties or, in rare cases, prohibition of imports. He called for customs barriers to allow American industrial development and to help protect infant industries, including bounties (subsidies) derived in part from those tariffs. He also believed that duties on raw materials should be generally low. Hamilton argued that despite an initial "increase of price" caused by regulations that control foreign competition, once

1875-511: The South denounced it as a " Tariff of Abominations " and it almost caused a rebellion in South Carolina until it was lowered. Between 1816 and the end of the Second World War, the United States had one of the highest average tariff rates on manufactured imports in the world. According to Paul Bairoch, the United States was "the homeland and bastion of modern protectionism" during this period. Many American intellectuals and politicians during

1950-414: The UK's technological advance was achieved “behind high and durable tariff barriers”. In 1846, the rate of industrialization per capita was more than double that of its closest competitors. Even after adopting free trade for most goods, Britain continued to closely regulate trade in strategic capital goods, such as machinery for the mass production of textiles. Free trade in Britain began in earnest with

2025-460: The US and Britain. He also predicted that a reduction in tariff rates would stimulate trade, including imports. The result, asserted Walker, would be a net increase in customs revenue, despite the reduced rates. Congress, then controlled by Democrats, acted quickly on Walker's recommendations. Southern Democrats, who had little industry in their states, were especially supportive. The Walker Tariff produced

2100-597: The United States were among the highest in the world. Chang claimed that, "almost all of today's rich countries used tariff protection and subsidies to develop their industries". A study of French cotton producers during the Napoleonic Wars found that regions which were protected from international trade with Britain due to blockades of British shipping, experienced greater growth in mechanized cotton output than regions which continued to have close trade with Britain. Canada developed its infant industries, while facilitating

2175-543: The United States and Germany, which remained protectionist. The country reintroduced large-scale tariffs, but it was too late to re-establish the nation's position as a dominant economic power. In 1932, the level of industrialization in the United States was 50% higher than in the United Kingdom. Before the new Constitution took effect in 1788, the Congress could not levy taxes – it sold land or begged money from

2250-426: The United States to achieve the fastest economic growth in the world throughout the 19th century and into the 1920s. Paul Krugman writes that protectionism does not lead to recessions. According to him, the decrease in imports (which can be obtained by introducing tariffs) has an expansive effect, that is, it is favourable to growth. Thus, in a trade war, since exports and imports will decrease equally, for everyone,

2325-677: The United States. States resorting to protectionism invoke unfair competition or dumping practices: According to the economists in favour of protecting industries, free trade would condemn developing countries to being nothing more than exporters of raw materials and importers of manufactured goods. The application of the theory of comparative advantage would lead them to specialise in the production of raw materials and extractive products and prevent them from acquiring an industrial base. Protection of infant industries (e.g., through tariffs on imported products) may be needed for some developing countries to industrialise and escape their dependence on

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2400-418: The abolition of export duties on most manufactured goods. Thus, the UK was the first country to pursue a strategy of large-scale infant-industry development. These policies were similar to those used by countries such as Japan, Korea and Taiwan after the Second World War. Outlining his policy, Walpole declared: Nothing contributes as much to the promotion of public welfare as the export of manufactured goods and

2475-557: The average tariff level remained around 12.5%, which was too low to encourage consumers to buy domestic products and thus support emerging American industries. When the Anglo-American War of 1812 broke out, all rates doubled to an average of 25% to account for increased government spending. The war paved the way for new industries by disrupting manufacturing imports from the UK and the rest of Europe. A major policy shift occurred in 1816, when American manufacturers who had benefited from

2550-528: The beginning of that century, the average tariff on British manufactured goods was about 50%, the highest of all major European countries. Despite its growing technological lead over other nations, the UK continued its policy of industrial promotion until the mid-19th century, maintaining very high tariffs on manufactured goods until the 1820s, two generations after the start of the Industrial Revolution . Thus, according to economic historian Paul Bairoch ,

2625-520: The city state of Athens , the port of Piraeus enforced a system of levies to raise taxes for the Athenian government. Grain was a key commodity that was imported through the port, and Piraeus was one of the main ports in the east Mediterranean . A levy of two percent was placed on goods arriving in the market through the docks of Piraeus. The Athenian government also placed restrictions on the lending of money and transport of grain to only be allowed through

2700-429: The colonists stuck to the production of raw materials and never became a competitor to British manufacturers. Policies were established to encourage the production of raw materials in the colonies. Walpole granted export subsidies (on the American side) and abolished import taxes (on the British side) on raw materials produced in the American colonies. The colonies were thus forced to leave the most profitable industries in

2775-435: The contrary, that the United States developed and rose to the top of the global economic hierarchy by adopting protectionism. In his view, the protectionist period corresponded to the golden age of American industry, when US economic performance outstripped that of the rest of the world. The U.S. adopted an interventionist policy to promote and protect their industries through tariffs. It was this protectionist policy that enabled

2850-402: The conversion of ageing industries. In this case, the aim was to save an activity threatened with extinction by external competition and to safeguard jobs. Protectionism must enable ageing companies to regain their competitiveness in the medium term and, for activities that are due to disappear, it allows the conversion of these activities and jobs. Infant industry argument The argument

2925-450: The country did not want to see developed. Walpole forced Americans to specialize in low-value-added products. The UK also banned exports from its colonies that competed with its own products at home and abroad. The country banned imports of cotton textiles from India, which at the time were superior to British products. It banned the export of woollen fabrics from its colonies to other countries (Wool Act). Finally, Britain wanted to ensure that

3000-534: The country's catching-up period felt that the free trade theory advocated by British classical economists was not suited to their country. They argued that the country should develop manufacturing industries and use government protection and subsidies for this purpose, as Britain had done before them. Many of the great American economists of the time, until the last quarter of the 19th century, were strong advocates of industrial protection: Daniel Raymond who influenced Friedrich List , Mathew Carey and his son Henry, who

3075-455: The duty to 30% and set off a railroad building boom in the 1850s. Tariff A tariff is a tax imposed by the government of a country or by a supranational union on imports or exports of goods. Besides being a source of revenue for the government, import duties can also be a form of regulation of foreign trade and policy that taxes foreign products to encourage or safeguard domestic industry. Protective tariffs are among

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3150-562: The early 1860s, Europe and the United States pursued completely different trade policies. The 1860s were a period of growing protectionism in the United States, while the European free trade phase lasted from 1860 to 1892. The tariff average rate on imports of manufactured goods in 1875 was from 40% to 50% in the United States, against 9% to 12% in continental Europe at the height of free trade. From 1871 to 1913, "the average U.S. tariff on dutiable imports never fell below 38 percent [and] gross national product (GNP) grew 4.3 percent annually, twice

3225-419: The economic cycle that was not there. A boom would generate enough revenue for tariffs to fall, and when the bust came pressure would build to raise them again. By the time that happened, the economy would be recovering, giving the impression that tariff cuts caused the crash and the reverse generated the recovery. Mr Irwin also methodically debunks the idea that protectionism made America a great industrial power,

3300-405: The hands of the United Kingdom. In 1800, Britain, with about 10% of Europe's population, supplied 29% of all pig iron produced in Europe, a proportion that had risen to 45% by 1830. Per capita industrial production was even higher: in 1830 it was 250% higher than in the rest of Europe, up from 110% in 1800. Protectionist policies of industrial promotion continued until the mid-19th century. At

3375-584: The high Morrill Tariff of 1861. The Walker Tariff remained in effect until the Tariff of 1857 , which used it as a base and reduced rates further. The 1861 Morril Tariff raised the effective rate collected on dutiable imports by approximately 70%. Customs revenue from tariffs totaled $ 345 million from 1861 through 1865. The tariff act of 1842 had a significant impact on railroad building. The duty of $ 17/ton of hammered bar iron and $ 25/ton of rolled bar iron raised costs by 50 to 80%. The Walker tariff of 1846 reduced

3450-412: The import of all kinds of manufactured imports, resulting in a huge drop in US trade and protests from all regions of the country. However, the embargo also had the effect of launching new, emerging US domestic industries across the board, particularly the textile industry, and marked the beginning of the manufacturing system in the United States. An attempt at imposing a high tariff occurred in 1828, but

3525-442: The import of foreign raw materials. Walpole's protectionist policies continued over the next century, helping British manufacturing catch up with and then leapfrog its continental counterparts. Britain remained a highly protectionist country until the mid-19th century. By 1820, the UK's average tariff rate on manufactured imports was 45-55%. Moreover, in its colonies, the UK imposed a total ban on advanced manufacturing activities that

3600-444: The importer, the exporter, and the consumer. Often intended to protect specific industries, tariffs can end up backfiring and harming the industries they were intended to protect through rising input costs and retaliatory tariffs. The notion that bilateral trade deficits are per se detrimental to the respective national economies is overwhelmingly rejected by trade experts and economists. The English term tariff derives from

3675-430: The introduction of protectionist measures, even self-sufficient, in some countries, with the exception of those applied in the United States in the summer of 1930, but with very limited negative effects. He noted that "the credit crunch is one of the main causes of the trade crunch." "In fact, international liquidity is the cause of the trade contraction. This liquidity collapsed in 1930 (-35.7%) and 1931 (-26.7%). A study by

3750-416: The most widely used instruments of protectionism , along with import quotas and export quotas and other non-tariff barriers to trade . Tariffs can be fixed (a constant sum per unit of imported goods or a percentage of the price) or variable (the amount varies according to the price). Tariffs on imports are designed to raise the price of imported goods and services to discourage consumption. The intention

3825-551: The nation's first standardized tariff: rather than setting fixed rates for specific items on a case-by-case basis, it established general schedules into which all goods could be classified, subject to defined ad valorem rates. The bill reduced rates across the board on most major import items save luxury goods , such as tobacco and alcoholic beverages . The bill made moderate reductions in many tariff rates. As Walker had predicted, trade increased substantially, and net revenue collected also increased, from $ 30 million annually under

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3900-454: The negative effect of a decrease in exports will be offset by the expansionary effect of a decrease in imports. Therefore, a trade war does not cause a recession. Furthermore, he points out that the Smoot-Hawley tariff did not cause the Great Depression. The decline in trade between 1929 and 1933 "was almost entirely a consequence of the Depression, not a cause. Trade barriers were a response to

3975-437: The old model of blanket protection intended to nurture import substitute industries, it would be a mistake to go to the other extreme and deny developing countries the opportunity of actively nurturing the development of an industrial sector". According to economist Ha-Joon Chang , many countries have successfully industrialized behind tariff barriers, such as the United States and Britain. From 1816 through 1945, tariffs in

4050-463: The pace in free trade Britain and well above the U.S. average in the 20th century," notes Alfred Eckes Jr, chairman of the U.S. International Trade Commission under President Reagan. After the United States caught up with European industries in the 1890s, the Mckinley Tariff 's argument was no longer to protect “infant industries”, but to maintain workers' wages, support agricultural protection and

4125-427: The pattern of American economic policy until the end of World War II, and his program created the conditions for rapid industrial development. Alexander Hamilton and Daniel Raymond were among the first theorists to present the infant industry argument . Hamilton was the first to use the term "infant industries" and to introduce it to the forefront of economic thinking. Hamilton believed that political independence

4200-492: The port of Piraeus. In the 14th century, Edward III took interventionist measures, such as banning the import of woollen cloth in an attempt to develop local manufacturing. Beginning in 1489, Henry VII took actions such as increasing export duties on raw wool. The Tudor monarchs, especially Henry VIII and Elizabeth I , used protectionism, subsidies, distribution of monopoly rights, government-sponsored industrial espionage and other means of government intervention to develop

4275-470: The principle of reciprocity. In 1896, the Republican Party platform pledged to "renew and emphasize our allegiance to the policy of protection, as the bulwark of American industrial independence, and the foundation of development and prosperity. This true American policy taxes foreign products and encourages home industry. It puts the burden of revenue on foreign goods; it secures the American market for

4350-436: The production of raw materials. Economist Ha-Joon Chang argued in 2001 that most of today's developed countries have developed through policies that are the opposite of free trade and laissez-faire such as interventionist trade and industrial policies to promote and protect infant industries. In his view, Britain and the United States have not reached the top of the global economic hierarchy by adopting free trade. As for

4425-589: The rates of customs'. This Turkish term is a loanword of the Persian : تعرفه , romanized :  taʿrefe , lit.   'set price, receipt'. The Persian term derives from Arabic : تعريف , romanized :  taʿrīf , lit.   'notification; description; definition; announcement; assertion; inventory of fees to be paid' which is the verbal noun of Arabic : عرف , romanized :  ʿarafa , lit.   'to know; to be able; to recognise; to find out'. In

4500-456: The same industries that infant industry protection is intended to help. Even when infant industry protection is well-intentioned, it is difficult for governments to know which industries they should protect; infant industries may never grow up relative to adult foreign competitors. During the 1980s Brazil enforced strict controls on the import of foreign computers in an effort to nurture its own infant computer industry. This industry never matured;

4575-781: The settlement of the Canadian West through immigration and railway construction under the National Policy (1879–1950s) following an earlier experiment in free trade with the United States. South Korea and Taiwan are more recent examples of rapid industrialization and economic development with major government subsidies, foreign exchange controls, and high tariffs to protect selected industries. In Latin America , many countries have implemented economic policies which establish high tariffs and other barriers to international trade, such as Brazil. Many Latin American economists have contributed to

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4650-456: The states. The new national government needed revenue and decided to depend upon a tax on imports with the Tariff of 1789 . The policy of the U.S. before 1860 was low tariffs "for revenue only" (since duties continued to fund the national government). The Embargo Act of 1807 was passed by the U.S. Congress in that year in response to British aggression. While not a tariff per se, the Act prohibited

4725-453: The summit of greatness, he kicks away the ladder by which he climbed up, in order to deprive others of the means of climbing up after him." Infant industry protection is controversial as a policy recommendation. As with the other economic rationales for protectionism, it is often abused by rent seeking interests. In addition, countries that put up trade barriers to imports often face retaliatory barriers to their exports, potentially hurting

4800-475: The tariffs lobbied to retain them. New legislation was introduced to keep tariffs at the same levels —especially protected were cotton, woolen, and iron goods. The American industrial interests that had blossomed because of the tariff lobbied to keep it, and had it raised to 35 percent in 1816. The public approved, and by 1820, America's average tariff was up to 40 percent. In the 19th century, statesmen such as Senator Henry Clay continued Hamilton's themes within

4875-486: The technological gap between Brazil and the rest of the world actually widened, while the protected industries merely copied low-end foreign computers and sold them at inflated prices. In his 2000 report to the UN Secretary-General , Ernesto Zedillo recommended "legitimising limited, time-bound protection for certain industries by countries in the early stages of industrialisation", arguing that "however misguided

4950-433: The wool industry, leading to England became the largest wool-producing nation in the world. A protectionist turning point in British economic policy came in 1721, when policies to promote manufacturing industries were introduced by Robert Walpole . These included, for example, increased tariffs on imported foreign manufactured goods, export subsidies, reduced tariffs on imported raw materials used for manufactured goods and

5025-520: Was denied the use of tariffs to protect its new industries. This explains why, after independence, the Tariff Act of 1789 was the second bill of the Republic signed by President Washington allowing Congress to impose a fixed tariff of 5% on all imports, with a few exceptions. The Congress passed a tariff act (1789), imposing a 5% flat rate tariff on all imports. Between 1792 and the war with Britain in 1812,

5100-459: Was finally overtaken economically by the United States around 1880. British leadership in fields such as steel and textiles was eroded, and the country fell behind as new, more technologically advanced industries emerged after 1870 in other countries still practicing protectionism. On June 15, 1903, the Secretary of State for Foreign Affairs, Henry Petty-Fitzmaurice, 5th Marquess of Lansdowne , made

5175-543: Was first fully articulated by the first United States Secretary of the Treasury Alexander Hamilton in his 1790 Report on Manufactures . Hamilton professed that developing an industrial base in a country was impossible without protectionism because import duties are necessary to shelter domestic "infant industries" until they could achieve economies of scale . The argument was systematically developed by American political economist Daniel Raymond , and

5250-456: Was later picked up by economist Friedrich List in his 1841 work The National System of Political Economy, following his exposure to the idea during his residence in the United States in the 1820s. List criticized Britain for advocating free trade to other countries given that Britain had obtained its economic supremacy through high tariffs and government subsidies. List stated that "it is a very common clever device that when anyone has attained

5325-458: Was one of Lincoln's economic advisers. The intellectual leader of this movement was Alexander Hamilton , the first Secretary of the Treasury of the United States (1789–95). The United States rejected David Ricardo 's theory of comparative advantage and protected its industry. The country pursued a protectionist policy from the beginning of the 19th century until the middle of the 20th century, after

5400-477: Was one of the lowest tariffs in American history. Democrat James Polk was elected President in 1844 over Henry Clay , a Whig who advocated a high tariff. President Polk declared that reduction of the "Black Tariff" would be the first of the "four great measures" that would define his administration. He directed Walker to work out the details. In 1846, Polk delivered Walker's tariff proposal to Congress . Walker urged its adoption to increase commerce between

5475-530: Was predicated upon economic independence. Increasing the domestic supply of manufactured goods, particularly war materials, was seen as an issue of national security. And he feared that Britain's policy towards the colonies would condemn the United States to be only producers of agricultural products and raw materials. Britain initially did not want to industrialise the American colonies, and implemented policies to that effect (for example, banning high value-added manufacturing activities). Under British rule, America

5550-522: Was small. According to William J. Bernstein , most economic historians now believe that only a fraction of the GDP loss worldwide and in the U.S. resulted from tariff wars. Bernstein argued that the decline "could not have exceeded 1 or 2% of world GDP, a far cry from the 17% recorded during the Great Depression." Jacques Sapir argues that the crisis has other causes than protectionism. He points out that "domestic production in major industrialized countries

5625-401: Was usually high protective tariffs (apart from 1913 to 1921). After 1890, the tariff on wool did affect an important industry, but otherwise the tariffs were designed to keep American wages high. The conservative Republican tradition, typified by William McKinley was a high tariff, while the Democrats typically called for a lower tariff to help consumers but they always failed until 1913. In

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