Smoot Hawley Tariff Act Of 1930 Research Paper

History- The Smoot-Hawley Tariff act of 1930, was a protectionist act in order to protect American industry, and American farmers. This act was originally introduced by Senator Reed Smoot of Utah. And Representative Willis Hawley of Oregon. This act was to raise the already high tariffs in the United States. In 1922, Congress had already passed a Tariff Act, known as the Fordney McCumber act. This bill raised the tariffs, to promote american protectionism, which congress viewed as pro-business. The McCumber act increased import taxes by 40%. European countries whose economies were in ruin after world war one, hated these tariffs. But, this retaliation did not affect American prosperity. As european farmers began producing goods again, the free

This gave republicans the chance to try and raise tariffs even more, especially on agricultural imports. This was in favor to establish increased agricultural protectionism for American farmers. However, these efforts failed to increase tariffs because of centrist republicans present in the senate in 1928. But, because of the downfall of the agricultural sector, and massive amounts of debt, low wages, and failure to liquidate large bank loans. US production fell at a fast rate, and unemployment skyrocketed. This killed the US economy, and led to the stock market crash of 1929. This made protectionism gain strength. It gave Republicans an open door to pass their tariff bills. The Smoot-Hawley Tariff act, passed in the senate very well, 44-42, but passed extremely well in the House of Representatives 264-147. This act was signed into law on June, 17 1930. Even after being protested by over 1,000 economists begging to have the bill vetoed. Economists started petitions against the bill, fearing of the economic damage that would outcome. President Hoover signed the bill

The 71st Congress (1929-1931) was dominantly Republicans, 270. While the democrats only had 164 members. The republicans loved these tariff acts, because they believed it was pro American industry. Senator Smoot, believed that these raised tariffs would kill overproduction, of especially agriculture. While many economists at the time who were against the act, argued that the act would be “Compelling the consumer to subsidize waste and inefficiency in [domestic] industry.” second “our export trade in general would suffer. Countries cannot buy from us unless they are permitted to sell to us.” third, this protectionist act would “inevitably provoke other countries to pay us back in kind against our goods.” And lastly, investors would suffer because this act would make it “more difficult for their foreign debtors to pay them interest due them.”. This bill was constitutional, under the commerce clause, and the necessary and proper clause. The commerce clause can be used here, because congress was regulating agricultural trade to other nations. This was also allowed under the necessary and proper clause, because Congress could say that because of overproduction, and the fall of the stock market. A law was necessary to regulate the overproduction, and provide protection to american farmers. The bill, after being introduced to congress, had many revisions as many special interest groups demanded protection. What was introduced