=International Commerce: Its Beginnings.=—Before the Revolution a
considerable amount of trade was carried on between the American
colonies and various European countries, chiefly Great Britain. After
the winning of independence this foreign commerce began to grow rapidly
because the hindrances that had formerly been imposed upon it were now
removed. Moreover, the Napoleonic wars in Europe brought about an
enormous increase in the demand for American foodstuffs. These wars
retarded agriculture in Europe and forced the various countries to
import supplies from overseas. American shipping developed greatly
during the period 1790-1805, but it thereafter received a set-back owing
to the blockades and the Embargo Act of 1807, followed a few years later
by a four-years’ war with England.
=Tariff Policy.=—During the period immediately preceding the framing of
the constitution each of the thirteen states was free to regulate its
own commercial relations. Each determined for itself whether it would
permit imports to come in freely from other states and other countries
or whether it would impose duties on such imports. [Sidenote: The
constitution empowers Congress to regulate foreign trade.] This
arrangement proved altogether unsatisfactory and the constitution gave
to Congress complete authority to control commerce with foreign
countries and among the states. This action was taken primarily to
afford Congress an adequate revenue in the way of taxes on imports,
although it was also designed to put an end to undue commercial rivalry
among the states themselves. In 1792, therefore, Congress passed our
first tariff law, a measure designed mainly to bring forth income for
the new federal government but also to afford protection to American
industries. [Sidenote: This is done by tariffs.] This act of 1792 marks
the beginning of a long line of tariff measures, some imposing high
duties on imports and some setting these duties at lower rates.[165]
[Sidenote: The Tariff Commission.]
The making of the tariff is in the hands of Congress but the function of
studying the industrial needs of the country is entrusted to a Tariff
Commission of six members appointed by the President. This commission is
empowered to make recommendations to Congress, but Congress is under no
obligation to follow its advice nor has it usually done so. Tariff rates
are fixed, for the most part, in obedience to political pressure.
[Sidenote: The case for protection.]
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