Party stances can be confusing. Parties often make U-turns on key policy issues.
For example, the Democratic Party long criticized big government. Some Democrats still hold Jefferson-Jackson dinners, claiming the mantle of two champions of the common man. They don’t acknowledge how appalled those men would be by the overlapping programs and bureaucracies created by 20th-century Democrats.
Until 1981, Republicans legitimately were the party of balanced budgets, before discovering that big spending combined with low-tax rhetoric won more votes.
Democrats assume theirs always has been the natural party of African-Americans, ignoring a century in which Democrats created and enforced racial segregation and discrimination and most African-Americans voted for the party of Lincoln.
So it is understandable why many, including U.S. Rep. Michele Bachmann, are confused about the two parties’ historical positions on trade. The Minnesota Republican recently criticized Franklin Roosevelt for supporting the Smoot-Hawley Tariff that contributed greatly to the severity and geographical extent of the Great Depression.
The problem is that both Reed Smoot and Willis Hawley were Republicans. So was President Herbert Hoover, who signed the bill into law three years before Roosevelt’s inauguration. If there ever was a piece of legislation that had Republican written all over it, it was Smoot-Hawley.
Roosevelt’s administration essentially repealed Smoot-Hawley with the Reciprocal Trade Agreements Act of 1934. That act, which gave the president power to negotiate tariff-lowering trade agreements with other nations, is the foundation of all succeeding trade policy. This includes the U.S. helping found the General Agreement on Tariffs and Trade during the Democratic Truman Administration and the World Trade Organization, initiated under Republican Ronald Reagan but ratified by a Democratic-majority Congress early in the term of Democrat Bill Clinton.
The Republican Party, with its base in the manufacturing-dominated North and Northeast, long championed high tariffs. The Democrats, with support in the agricultural South and West, had been anti-tariff before the Civil War and remained so afterward.
High tariffs allowed U.S. manufacturers to charge higher prices. They also hired more workers. But high tariffs increased the cost of manufactured goods for farmers, small businesses and households. High tariffs also encouraged reciprocal taxes by European countries on U.S. exports of cotton and grains.
There was a pattern of Republican administrations and Congresses raising tariffs and Democratic ones lowering them. So the Payne-Aldrich Tariff of 1909, passed by a Republican Congress and signed by Republican President William H. Taft, raised basic tariff rates to 40 percent.
In 1913, the Underwood Tariff drafted by Democrat Oscar Underwood and signed by Democratic President Woodrow Wilson lowered them to 25 percent. A 1922 tariff bill drafted by Willis Hawley, successfully sponsored by Representative Joseph Fordney and Senator Porter McCumber and signed by President Warren Harding, Republicans all, raised them back up until 1930, when Smoot-Hawley jacked them even further.
So while most contemporary Republicans are pro-trade and many Democrats criticize NAFTA, ongoing WTO negotiations and bilateral deals with friendly nations like Colombia and Chile, these stances result from U-turns in both parties that took place during my lifetime and that of Rep. Bachmann.
© 2009 Edward Lotterman
Chanarambie Consulting, Inc.