America's History of Protectionism

Robert W. Merry

Economics,

Protectionism has been a frequent feature of the republic since its founding.

IN LATE August 1985, while President Ronald Reagan vacationed at his ranch above Santa Barbara, California, his political director, Ed Rollins, had dinner one Saturday night with reporters for the New York Times and Washington Post. The mischievous politico leaked a story that received front-page treatment Monday morning. President Reagan had decided, the newspapers reported, to reject the pleas of U.S. shoe manufacturers for import tariffs designed to protect them from foreign competition. No big surprise there. Reagan was known as a fervent free trader, hostile to tariffs and other barriers to global commerce.

But discerning Washington hands detected a curious disparity in how the two influential newspapers handled the story. The Post focused on the shoe decision, noting only in passing, that Reagan also was weighing actions to counter unfair practices used by U.S. trade partners. The Post headline read, “Reagan Set to Reject Shoe Curbs.” But the Times turned that around with a top headline that stated, “Reagan Weighing Trade Sanctions, Officials Report.” The paper’s lead paragraph emphasized the president’s decision to weigh “punitive actions” against errant nations abusing America’s free-trade principles.

This led to confusion about Reagan’s true stance on trade at a time when that issue was roiling the country’s politics and when some White House clarity was needed. The president had his press secretary inform White House reporters that Reagan would deliver a major trade address in about a month. A trade-policy struggle within the administration ensued that was so intense that the president’s speechwriters were barred from creating the final draft of the speech.

This episode exemplifies the contention that has surrounded the trade issue throughout American history, starting with Alexander Hamilton, the country’s first treasury secretary and also its first significant protectionist. Today, protectionism is back. The main drivers of this new surge are Republican presidential nominee Donald Trump and the Democratic insurgent Bernie Sanders. Even Hillary Clinton is playing a role. Far from being an aberration, opposition to free trade has been a constituent part of America’s history.