PRO TIP: It was nothing like what you probably think it was.

Protectionism in the United States is protectionist economic policy that erects tariffs and other barriers on imported goods. This policy was most prevalent in the 19th century. At that time, it was mainly used to protect Northern industries and was opposed by Southern states that wanted free trade to expand cotton and other agricultural exports. Protectionist measures included tariffs and quotas on imported goods, along with subsidies and other means, to restrain the free movement of imported goods, thus encouraging local industry.

There was a general lessening of protectionist measures from the 1930s onwards, culminating in the free trade period that followed the Second World War. After the war, the United States promoted the General Agreement on Tariffs and Trade (GATT), to liberalize trade among all capitalist countries. In 1995, GATT became the World Trade Organization (WTO), and with the collapse of Communism its open markets/low tariff ideology became dominant worldwide. Protectionism has increased in popularity since the election of Donald Trump in 2016.

Britain was the first country to successfully use a large-scale infant industry promotion strategy. However, its most ardent user was the U.S. Economic historian Paul Bairoch once called it “the homeland and bastion of modern protectionism” (Economics and World History: Myths and Paradoxes, Bairoch).

Britain initially did not want to industrialize the American colonies, and implemented policies to that effect. For example, banning high value-added manufacturing activities. Thus, the American Revolution was, to some extent, a war against this policy, in which the commercial elite of the colonies rebelled against being forced to play a lesser role in the emerging Atlantic economy. 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.

Most American intellectuals and politicians during the country’s catching-up period felt that the free trade theory advocated by British classical economists was not suited to their country. The US went against the advice of economists like Adam Smith, Ricardo and Jean Baptiste Say and tried to protect its industries. Alexander Hamilton, the first Secretary of the Treasury of the United States (1789–1795) and economist Daniel Raymond were the first theorists to present the argument of the emerging industry, not the German economist Friedrich List. List started out as a free trade advocate and only converted to the infant industry argument following his exile in the U.S (1825–1830).

Hamilton feared that Britain’s policy towards the colonies would condemn the United States to be only producers of agricultural products and raw materials. Washington and Hamilton believed that political independence was predicated upon economic independence. Increasing the domestic supply of manufactured goods, particularly war materials, was seen as an issue of national security. In his Reports, Hamilton argued that the competition from abroad and the “forces of habit” would mean that new industries that could soon become internationally competitive (“infant industries”) would not be started in the United States, unless the initial losses were guaranteed by government aid.

According to him, this aid 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 explained that despite an initial “increase of price” caused by regulations that control foreign competition, once a “domestic manufacture has attained to perfection … it invariably becomes cheaper”.

In 1789, Congress passed a tariff act , imposing a 5% flat rate tariff on all imports. Between 1792 and the war with Britain in 1812, the average tariff level remained around 12.5%. In 1812, all tariffs were doubled to an average of 25%, in order to cope with the increase in public expenditure due to the war.

In 1816, a new law was introduced to keep the tariff level close to the wartime level—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.

According to Michael Lind, protectionism was America’s de facto policy from the passage of the Tariff of 1816 to World War II, “switching to free trade only in 1945”.

Somewhat surprising, no? What first got me to thinking about these weighty matters was Bayou Peter’s post on them, expounding Jeff Childers’s post on same. To wit:

It would be easy to dismiss yesterday’s announcement as dry, economic arcana — tariffs, trade deficits, bilateral agreements, country-by-country charts, and economic reports. But don’t be fooled by all the paperwork. What Trump did wasn’t just a historic across-the-board trade action.

It was a once-in-a-century power shift.

To understand how truly historic it was, look back to Bretton Woods, 1944 — the postwar deal where America agreed to carry the world’s economic burdens in exchange for geopolitical dominance.

After the devastation of WWII, the United States promised to help rebuild Europe and Japan, by opening our previously protected markets to foreign goods, keeping our tariffs low to nonexistent, providing the world’s reserve currency, and underwriting global security with American military power.

In return, other countries were supposed to gradually liberalize their economies, buy American goods, and play by the rules. But they never did.

Instead, they took our postwar deal —designed to help them— and ran with it. They piled up tariffs, non-tariff barriers, VAT taxes, and trade cheats while the U.S. kept its markets wide open.

For decades, the American working class footed the bill while foreign economies fattened themselves, and American elites made billions facilitating and perpetuating the grift. That was globalism. It’s not an ideology— it is a business model. And Trump just crushed the model.

I’ve always insisted that Trump is a helluva lot smarter than most people want to give him credit for. The obvious fact that he fully understands what his tariff moves are at bottom all about ought to establish his intelligence to all but the most reflexively stubborn Trump hater’s satisfaction.

Lots more yet to the above-linked posts, natch; dry and deadly dull as the subject matter may seem at first blush, you really, really want to read all three in their entirety.

Update! You gotta love it, you truly, truly do.

Tariff Liberation Day Has Arrived
Cue the mass hysteria. Donald Trump’s Liberation Day has arrived, as the decades of foreign nations tariffing our goods without reciprocal tariffs ends.

The tariff war between the United States and dozens of other nations just took a major escalation, as the president imposed reciprocal tariffs on a number of goods from a lengthy list of countries. (The tariffs are reciprocal in that if a nation tariffs 10% on U.S. goods, so will we on that nation’s products.) The president aims to bring manufacturing back to America and to cow hostile nations. While many economists and media figures are prophesying economic disaster, it is worth noting that tariffs during both Ronald Reagan’s presidency and Donald Trump’s first term boosted economic growth and wage increases here in America.

Trump declared in an executive order that he finds “underlying conditions, including a lack of reciprocity in our bilateral trade relationships, disparate tariff rates and non-tariff barriers, and U.S. trading partners’ economic policies that suppress domestic wages and consumption, as indicated by large and persistent annual U.S. goods trade deficits, constitute an unusual and extraordinary threat to the national security and economy of the United States.“

While other countries have been allowed to impose extortionate tariffs on American goods for decades, America has often not imposed reciprocal tariffs, leading to a very unbalanced and unfair system that often drives manufacturing and jobs out of the U.S. It remains to be seen if Trump’s new tariffs can successfully bring home jobs and boost our economy.

Let the shitlibs whinge and complain as loud and as long as they like, Mr President, sir. They’re going to anyway, no matter what you do or don’t do, which we all know full well by now. So let the sound of their rage, frustration, and bitter despair be as music to every ReichWingNaziDeathBeast© ear, sayeth I. Just more for decent, right-thinking Americans to point and laugh at, and that’s a thing of goodness.