The History of U.S. Tariffs: From Protectionism to Free Trade

Early Tariffs and National Survival

Tariffs played a crucial role in early U.S. history, providing revenue for a fledgling government after independence. The Embargo of 1807 imposed harsh tariffs to promote American manufacturing, aiding industries like textiles while raising the cost of imports.

The Tariff Debate Heats Up

In the 19th century, tariffs deepened North-South divisions. High tariffs protected Northern industry but hurt Southern farmers, leading to the Nullification Crisis of 1832. Henry Clay’s compromise temporarily resolved tensions, but the debate persisted.

Industrialization and Gilded Age Tariffs

As America industrialized, tariffs soared during the Gilded Age, shielding U.S. industries from global competition. The Smoot-Hawley Tariff Act of 1930, however, backfired, worsening the Great Depression by stifling global trade.

The Shift to Free Trade

After World War II, free trade gained traction with agreements like the General Agreement on Tariffs and Trade (GATT) in 1947. By the late 20th century, bipartisan consensus supported free trade policies, shaping global economic cooperation.

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