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Tariff of Abominations of 1828

The Panic of 1819 and the subsequent depression stimulated widespread criticism of the economic forces and Government policies that many considered responsible for the hard times in the early 1820's. This criticism, in turn, triggered a reconsideration and reevaluation of the Nation's tariff policies.

The great tariff controversy of the late 1820's revolved as much around constitutional and sectional questions as it did strictly economic considerations.' It was during this period, however, that many Americans first became convinced that the Nation's economic health depended, to a large degree, on the level of the tariffs. Through the next century and beyond, an incessant, unresolved debate raged over whether high rates or low would most effectively pull the Nation out of an economic decline. Both. strategies were tried several times, yet depressions and recessions continued to occur. In retrospect, it seems that the specific level of the tariff rates actually had a relatively minor influence on the well-being of so complex and differentiated an economic entity as the United States in that period. Nevertheless, the debate continues even today.

In the 1820's the manufacturers and producers who suffered competition from imports first suggested that higher, protective tariff rates might bring about overall economic recovery. This helped them to justify their calls for protection of their particular branch of industry. As one critic lamented, "The history of the American tariffs records the triumph of special interests over the general welfare."

Special-interest groups very quickly learned how to exploit the cumbersome process of tariffmaking. Because the Constitution assigns the House of Representatives responsibility for initiating all money bills, the development of a general tariff measure usually began in the House Committee on Ways and Means. While under consideration within the committee, a tariff proposal became the subject of considerable logrolling and compromise among the committee members. As the committee's proposal made its glacial progress toward approval by the full House, the Representatives had ample opportunity to mold and amend the bill.

The completed House measure then went to the Senate Committee on Finance, which could add a number of amendments for consideration on the Senate floor. Few Senators missed taking an opportunity to comment on a tariff bill before voting on it. Because the Senate and House versions usually differed quite substantially, a conference committee had to iron out the differences. At each of these stages, lobbyists for particular industries, producers, or sections of the country could bring pressures to bear in order to influence the outcome.

The tariff bills that finally reached the President's desk for signature seldom reflected any rational scheme or program. As one political scientist who had studied the process concluded, "In tariff making, perhaps more than in any other kind of legislation, Congress writes bills which no one intended."

Partly because of this factor, tariff revisions were quite common, with new ones emanating from Capitol Hill about every 5 or 6 years. For example, four major tariff acts won approval between 1824 and 1833. Because the U.S. Treasury was amply supplied with funds at the beginning of this period, the 1824 Tariff Act can be considered the first clearly protectionist tariff legislation in US history.

The only justification advanced for the raising of duties on a number of items was that it would insulate U.S. manufacturers, farmers, and workers from foreign competition. Among the most controversial aspects of the act were great increases in duties on raw wool and finished woolen goods. Despite the protection thus granted, spokesmen for the woolens industry remained dissatisfied. Three years later they were back in Washington, promoting a woolens bill to raise the protective walls still higher. Though it failed, this particular bill came so close to winning approval that it set off a flurry of negotiation and debate in the following year which culminated in the so-called Tariff of Abominations of 1828.

Opponents of a protectionist tariff policy had originally planned for the 1828 bill to be so extreme as to discredit the whole protectionist philosophy. Their strategy called for the raising of tariff barriers on almost every conceivable article of domestic manufacture, and Congressmen willingly joined in, making increasingly ridiculous upward revisions. The strategy backfired, however, when the advocates of protective rates proved capable of accepting almost anything as long as it promised high duties on the commodities they particularly favored.

To the horror of some of its original sponsors, the grotesque bill worked its way through both Houses of Congress and won Presidential approval. Overnight, the Tariff of Abominations became the leading campaign issue in the Presidential election of 1828, which elevated Andrew Jackson to the White House.

The compromise tariff of 1833 set in motion a gradual reduction of the protectionist rates over a 10-year period, and it contained a pledge that at the end of that period the tariff would revert almost exclusively to a revenue measure. Protectionist rates were defined as any levies in excess of 20 percent ad valorem in the 1832 bill. All such rates would decrease 10 percent every other year until 1841, at which point they would drop by half. In 1842 even these residual protectionist features would lapse. The standard rate for most imports would be 20 percent ad valorem, and a number of goods would be added to the free list of items, on which no duties whatsoever were levied.

As a legislative compromise, Clay's proposals worked very well: tariffs dropped out of the political picture for the next decade. Protected industries had several years to grow and to prepare for the major rate reductions, and the opponents of high tariffs were assured that protectionism was on the road to extinction. As a practical method for collecting customs duties, however, the 1833 compromise proved extremely awkward, with the existing complexity of its rate structure compounded by the periodic reductions.

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Page last modified: 06-10-2017 19:05:46 ZULU