1883 - The Mongrel Tariff
A comprehensive package of revenue bills included what was to become the Tariff Act of 1862. In addition to tariffs, the package included measures to authorize the issuance of greenbacks and bonds, to impose heavy excise taxes on domestic commodities, and to establish an income tax. The tariff bill dramatically raised the rates the Morrill Act had established. Congress was obviously tapping every conceivable resource for additional funds. A prime reason for increasing some of the tariff rates was that domestic industries needed additional protection to compensate them for the excise and income taxes they now had to pay. Because the leading advocates of these measures were also dedicated protectionists, however, they felt little compunction at all about raising the tariff rates.
Another round of tax-raising legislation passed in the spring of 1864. Commissioner of the Revenue David A. Wells calculated that at that point the internal revenue system taxed virtually everything in the Nation at a rate between 8 and 15 percent. The import taxes had to be raised a corresponding amount just to maintain the relative competitive positions of domestic and foreign producers. But these justifiable adjustments only established the base level. Northern Representatives and Senators favoring protection and now enjoying complete control in a Congress lacking any representation from the predominantly low-tariff South pushed the war tariffs to extremely high levels.
The war taxation program involving import, income, and excise taxes created an enormous volume of revenue. As the war drew to a close, this revenue enabled the Government to complete payments on contracts and to establish funding arrangements for the bewildering array of bonds issued during the emergency. Very quickly, Congress had to respond to the chorus of complaints about high taxes. In almost every instance, however, it reduced or eliminated the internal taxes, leaving the import levies in force. The longer the wartime tariff levels persisted, the more difficult it seemed to reduce them.
The historically high tariff rates, imposed in the midst of the Nation's most dire emergency, gradually came to be considered normal. Several factors contributed to the persistence of these elevated tariff rates. The protectionist Radical majority of the Republican Party continued to dominate U.S. politics well into the 1870's. Furthermore, tariff rates seemed of relatively minor importance when compared with the wealth of complex political, social, and economic issues that characterized the Reconstruction era. As long as the economy prospered-and the economy in the North certainly was booming - congressional representatives of Northern interests had no intention of tinkering with the protective tariffs.
The Republicans' protectionist attitudes at this time corresponded to similar policies overseas, although they were based on somewhat different premises. A new age of colonialism had dawned. France, England, Germany, and other nations entered a race to create everlarger colonial empires. France and Germany adopted the neo-mercantilist policy of raising tariff barriers to protect their own internal producers and to discourage others from attempting to engross the trade of their colonies.
Although the British still fervently advocated free trade, they, too, provided special preferences in the import and export trade of the colonies and dominions under their control. Not surprisingly, the United States encountered exclusions of its exports as a result of these foreign restrictive trade measures. This treatment only stimulated calls for still higher trade barriers in the United States, and US protectionists could point to European examples as a justification for their own positions.
One real embarrassment the high rates caused, particularly during prosperous times such as the years immediately following the Civil War, was that the United States imported so many goods, despite the high duties, that its customs receipts were larger than necessary for the operation of the Federal Government. As surplus revenues poured into the Treasury in the early 1870's, agitation for some sort of reduction grew more insistent.
When the economy righted itself in the early 1880's, the surplus revenue problem naturally reappeared. Once again, calls for tariff reform arose. In 1883 the Republican Congress created a board of experts, a tariff commission, to investigate the whole import revenue system and to make well-reasoned recommendations. Despite his declared intention to lower the tariff, Republican President Chester A. Arthur appointed to this commission men who were well-known protectionists. Its chairman was John L. Hayes, a lobbyist for the woolens industry. Nevertheless, the existing rate structure was so indefensible that the commissioners eventually called for average reductions of approximately 25 percent.
Congress had the final word, however, and submitted the whole question of tariff revision to a carefully selected House-Senate conference committee. This committee ignored the tariff commission's suggestions, and in some cases it also disregarded the proposals included in the Senate and House bills over which it was supposedly conferring. On a number of commodities, in fact, the conference committee actually settled upon tariff rates higher than those approved in either House.
The expiring lameduck Congress nevertheless certified the results of this incredible process in March 1883, and its enemies promptly dubbed the act the Mongrel Tariff. This tariff law's rates remained almost unchanged for the next 7 years while the partisans of protection battled free traders in a series of inconclusive skirmishes over how the tariff should be altered.
In his biography of Theodore Roosevelt, McCullough discussed Roscoe Conkling's rivalry with Roosevelt. Calling Conkling "among the most fascinating, outrageous men of the era," McCullough describes him as "considerably larger than life." He was "tall, beautiful, enormously talented in the art of politics," but in the view of the senior Roosevelt and other reformers, "evil incarnate." He continued: "Conkling was not a crook; his name had been linked with no scandals; nor had he any personal crudities of the kind associated with a reprobate like [William Marcy] Tweed [the notorious leader of the corrupt political machine known as Tammany Hall]. What was so objectionable about Conkling was his utterly masterful, arrogant use of the very system [the reformers] deplored . . . .
"Conkling himself, the picture of conspicuous manhood, stood six feet three, and was solidly formed beneath his extravagant clothes . . . . Women thought Conkling gorgeous, which he was. He carried a sun umbrella and favored bright bow ties, fawn-colored vests and trousers, English gaiters [cloth coverings for the lower portion of the pants], and gleaming pointed shoes. His beard was the color of burnished copper and it too was pointed. His hair was a darker red, thick and wavy, and he combed it to produce a single Hyperion curl at the center of his forehead . . . .
"Though a married man with children he had for years been carrying on an affair with a fellow senator's wife, the beautiful, ambitious Kate Chase Sprague . . . . He had little humor, no patience with those he thought beneath him intellectually. He remained haughty and insufferably vain, anything but a man of the people. He deplored the use of tobacco and whiskey and said so. He disliked reporters and crowds; he hated ever to be touched."
Conkling's base of power was the Customhouse on Wall Street, "the largest federal office outside Washington." It collected tariffs on imported goods, one of the Federal Government's prime sources of revenue - two-thirds of tariff revenue was collected through the Customhouse in New York. Conkling had installed Chester A. Arthur as Collector of the Port of New York. Although Arthur was not accused of corruption, virtually every aspect of the Customhouse's operation was corrupt. Nevertheless, President Rutherford B. Hayes fired Arthur as part of an ineffective reform effort.
Arthur, against his patron Conkling's advice, emerged as the Vice Presidential candidate in 1880 with presidential candidate James A. Blaine, a long-time Conkling foe. Shortly after taking office on March 4, 1881, President Blaine nominated a Conkling enemy,Judge William H. Robertson, to be Collector. In a fury at this breach of senatorial courtesy, Senators Conkling and Platt resigned:
"Both men had expected to be quickly vindicated and reinstated by a compliant legislature at Albany and thus to return to Washington stronger than ever. But it had not worked out as planned. Most people thought Conkling had made a fool of himself; the legislature turned on him and chose another in his place. Inconceivable as it seemed, the giant Conkling had come crashing down, his political career was ended".
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