What effects did high American tariffs have?

High American tariffs, particularly during the early 20th century and during the Great Depression in the 1930s, had several significant effects on both the domestic economy and international trade.

1. Protection of Domestic Industries: High tariffs were primarily designed to protect burgeoning American industries from foreign competition. By making imported goods more expensive, the tariffs encouraged consumers to buy domestic products, which supported American businesses and helped them grow.

2. Trade Retaliation: Higher American tariffs often led to retaliatory tariffs from other countries. For example, after the United States enacted the Smoot-Hawley Tariff Act in 1930, which raised tariffs on over 20,000 imported goods to record levels, other countries responded with their own tariffs on American products. This reduced international trade volumes, as it made exports less competitive abroad.

3. Impact on Consumers: While tariffs helped protect certain industries, they also made imported goods more expensive for American consumers. This limited their choices and increased the cost of living, as they had to pay more for certain products that were either imported or produced domestically at a higher cost due to reduced competition.

4. Contribution to the Great Depression: There is a consensus among economists that the high tariffs of the Smoot-Hawley Tariff Act worsened the Great Depression. The Act reduced international trade, which harmed not only the US economy but also the economies of other countries, deepening the global economic downturn.

5. Farming Sector Impact: The agricultural sector suffered notably because other countries imposed tariffs on American agricultural exports in response to US tariffs on their goods. Since the US was a large exporter of agricultural products, this had a negative impact on American farmers.

In summary, high American tariffs were intended to protect American jobs and industries but they ended up having broader negative consequences like reducing international trade, worsening the conditions of the Great Depression, and causing economic harm to consumers and sectors like agriculture.