America’s passion for tariffs rarely pays off, economists warn

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New York: Long before Donald Trump’s announcement of ‘Liberation Day’, the United States played with high rates throughout its history, which had unusual – and sometimes destructive – consequences.

“In the 21st -century economy, we have the 20th -century president who wants to take us back in the 19th century,” said Douglas Arun, a professor of Dartmot College Economics.

In the 19th century, the golden age of revenue was identified in the United States, with an average rate regularly tampering with 50 %. The century extended a theory adopted since the country’s establishment, which advocated for the protection of the US economy as it had passed for industrial.

“Careful studies of this era show that revenue helped save the industry’s domestic development to some extent,” said Keith Masks, a professor at Colorado University.

“But two more important factors were international labor and access to the capital … which was flowing into the United States during that period,” he added.

In addition to these factors, “our promoted industrial sector in the United States was that we had great access to natural resources,” said Christopher Messner, a professor at the University of California, California, Davis. These resources include coal, oil, iron ore, copper and wood – they were all important to the industry.

“If we had very little taxes, the industrial sector would not have been too small,” Messner added.

Immediately after taking office in January, Trump said: “We were in our richest position from 1870 to 1913.”

The 78 -year -old Republican often refers to former US President William McCainley, behind the country’s most limited tariff laws, which were passed in 1890.

These rates did not prevent imports from rising in the coming years, though once the customs duties were reduced in 1894, the amount of goods purchased abroad was below the back peaks.

Great depression

In 1929, Harvard’s Professor George Rorbach wrote: “Since the end of the civil war (1865), the United States has been under a security system, if not enough, our import trade has been greatly expanded.”

He added, “The fluctuations that have occurred are primarily related to factors other than tariff fluctuations.”

A year later, the young nation this time again tightened the patch with Republican President Herbert Hover.

According to the Center for Strategic and International Studies, the 1930 Smith Holly Tariff Act has been remembered best “to mobilize the global trade war and deepen great depression”.

“What created depression created … There were very complex factors, but the increase in tariffs is one of them,” said a masks from Colorado University. At the end of World War II, the beginning of a new era of trade was identified, praising 23 countries in 1947 – including the United States – GATT Free Trade Agreement.

The agreement created conditions for the development of international trade by imposing more moderate customs duties.

The pace was maintained by the North America Independent Trade Agreement (NAFTA) between the United States, Mexico and Canada, which came into force in 1994.

Along with Nafeta, the formation of the World Trade Organization in 1995, and the Free Trade Agreement between the United States and several Central American countries in 2004, was further expanded in the United States. During his first term, Donald Trump reopened the tariff ledger and decided on new measures against China, many of which were retained under his successor, Biden.

But despite these taxes, the US trade deficit with China increased by 2022, when China faced a brutal economic slowdown. For the Keith Masks, Beijing prices did not work much to prevent imports from China.