The academic claims the Smooth Hawley tariff caused or greatly contributed to the great depression in the United States is a lie that has been perpetuated for decades. Look at the facts.
1) The stock market crash occurred in 1929 before the Smoot Hawley tariff was enacted in 1930.
2) In 1929 US exports comprised 5% of GDP, half were agricultural and half were manufacturing. In 1933, at the bottom of the Great Depression exports comprised 3.3% of GDP. Only 1.7% of GDP was lost due to declining exports.
3) GDP contracted by 46% from 1929 to the bottom point of the Depression in 1933. US exports declined by 70% from 1929 to 1933 and some of that value loss was due to significant price deflation, not unit volume loss. This equates to at most 3.5 percentage points of GDP the remaining 42.5 percentage points of GDP loss were due to other factors.
4) With respect to “retaliatory tariffs”, other major economic powers, such as Great Britain, were imposing tariffs before Smoot Hawley was passed by Congress.
While free trade theorists in the academic community love to talk about Smoot Hawley causing the Depression, economic statistics show its impact on the economic decline was negligible.
“Leading economists” of today also failed to call the 2008 collapse and all most certainly contributed to it with the low interest rate policies of “leading economists” Mr. Greenspan and Mr. Bernanke. We have been following the economic prescription of one “leading economist” and Great Depression academic, “Ben Bernanke” since the 2008 collapse and we see the results - high unemployment/underemployment, staggering government debt, unprecedented money printing, declining real incomes, zero interest rates saving insolvent banks at the expense of average American savers, etc, etc, etc.
What we do know is the 35 years from 1865 to 1900 were the highest economic growth years in US history. During that period GNP increased 600% and the US became the world’s largest economic power. Throughout those 35 years, the average tariff applied to imports never dropped below 27%. Today, during a period of economic malaise the average tariff rate applied to imports is 1.3%. Looking at historical experience it is difficult to attribute high tariffs to economic disaster, no matter what “leading economists” claim.
RE: What we do know is the 35 years from 1865 to 1900 were the highest economic growth years in US history.
You just said — the USA had ZERO INCOME TAX then.
The USA already had an income tax ( and increasing at that ) during the Smoot Hawley period, so how do you compare the 1930’s to the turn of the 20th century?
I’d wholeheartedly have a flat tariff on imported goods in exchange for ZERO income tax.
A very nice thought as I said, but let’s see if we can get rid of Obamacare first. If you can’t even do that, getting rid of the income tax is a pipe dream.