ANSWER ON THE TARIFF-2 DISCUSSION BOARD Tariff Debate in the House, 1824: Note: This reading is
included to illustrate some of the details which Congress has to debate to
enact a tariff law. Begin with "The
Tariff Bill", on p. 724. See
the summary of the three authors’ positions and arguments posted from
class on 1/29. Note the references to Adam Smith on p. 727 and to Alexander
Hamilton on p. 728. In what
context are they cited? McLane Report (Documents
Relative to the Manufactures of the US), 1833: Note: In 1832 and 1833,
tariff rates were falling, in part in response to the South Carolina
Nullification Ordinance (see below). The
McLane Report asked manufacturers what were the consequences of falling
tariffs. The Report includes a
wealth of valuable statistical data regarding nineteenth century
manufacturing. 1. Summarize the
positions of Henry Stark of New Hampshire on the tariff and John Quimby of
Springfield, MA. Has the tariff
benefited agriculture, manufacturing or both? 2.
What would be the consequence for the Eagle Iron Works of Centre County, PA,
of the proposed tariff revisions? Nullification Ordinance, 1832
(refer also to the speech by McDuffie): 3. While this ordinance
does not deal explicitly with the economics of tariffs, it shows the
consequences of economic policy. To
what did South Carolina object, and on which sections of the Constitution
did South Carolina base its objections? Martineau, Society
in America, 1837 4. Martineau says that in
America, “everything may be obtained by merit”.
What other systems exist for distributing the output of a society?
What makes them succeed or fail? 5. What are the
respective natural allies of the federal party and the democratic party?
To which parties is Martineau referring?
6.
What is Martineau’s view of the pursuit of wealth, in general and in the
United States? Wayland text, 1837: 7. Describe Wayland's
ideal tax system. How does the
1837 system of revenue depart from his ideal? (See note, p. 450.) Protection
or Free Trade,
Dudley and Rawlins, 1880. 8.
Who are the two authors--where are they from, and which side of the debate
are they on? Why? (What is the primary trade policy of each country in
1880?) Dudley 10. On p. 8, Dudley asks
“...[I]f we can produce cotton fabrics, watches, &c., cheaper than
you, why do we require Protection for these commodities?”
How does he answer his own question?
Do you agree with him? 11. Explain how Britain
would be “doubly benefited” by free trade (bottom of p. 11), while the
US would “lose all and more than you gain” (top of p. 12).
Compare with Rawlins, pp. 17, 18. Rawlins 12. To what uses does
Rawlins find tariffs appropriate, and to what uses inappropriate? 13. What are the “two
classes of Protectionists in America” (p. 16), and how does Rawlins
respond to each? 14.
In Rawlins’ view, what is the basic difference between Protectionists and
Free Traders? 15.
What does Rawlins feel about the “infant industry” justification for
protection? 16. Explain the chain of
reasoning which leads Rawlins to state “Your Agriculturalists are then,
your future Free Traders”. (p. 29) Wayland & Chapin text, 1886: 17. Why does "the
protective theory still [linger] the last phase of feudal isolation" (p. 377)?
In what sense, if any, is this a market failure? 18. Note the discussion
of lobbying on pp. 377-378, and 381. What is the authors’ opinion of this behavior? 19. What is the
distinction between a revenue and
a protective tariff? 20. What are the
consequences of the uncertainty raised by tariffs? 21. Compare the quote
from Roscher on p. 385 with our reading in The Wealth of Nations. Are
they more similar or different? Are
Wayland & Chapin free traders? Cleveland, 1887: 22. What are the
macroeconomic implications of a federal budget surplus?
(Base your answer on your knowledge of basic macroeconomic policy;
specifically, the effects of different fiscal policy.) 23. Who is said to
benefit from tariffs, and how? 24. Which is a more
regressive tax, a tax on a luxury or a tax on a necessity?
(Here again, the answer is not explicitly in the text, although the
distinction between taxing necessities and luxuries has come up in several
readings. If you need to, look
up the definitions of “progressive” and “regressive” taxes in an
introductory book.) 25. Why does "free
trade" seem to be such a dirty word? (Bottom of p. 520.) Thompson, 1888: 26. Why does Thompson
disagree with Cleveland's plan to reduce federal revenue? (Note
Thompson's justification for taxing alcohol and tobacco.) 27. Does Thompson believe
that the tariff results in excessive profits for domestic owners? or
wages for domestic workers? 28. Does Thompson feel
that the U.S. growth in the nineteenth century was because of or in spite of
the tariff? Do you agree?
How might we find out for sure? Harrison, 1890 29.
Did the McKinley Tariff raise or lower duties?
Look up a brief summary of the objectives of this tariff. 30. What outcomes did
Harrison claim for the new tariff act? (Top of p. 524.) 31. Explain how the reciprocity portion of the McKinley Tariff Act was designed to work. If possible, find out whether this provision was effective or not. |
