Ideas of Globalisation: Hoover and Smoot-Hawley (and Trump!)
May 4, 2025
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Historian Gary Gerstle dives into the tumultuous legacy of the Smoot-Hawley Act of 1930, revealing how it worsened the Great Depression and shifted political power in U.S. tariff policy. He explores why President Hoover failed to halt its protective measures and discusses the tensions between idealism and cynicism in American politics. Gerstle also connects historical tariff battles to today’s political landscape, raising questions about the limits of presidential authority and the dangers of isolationism in a global economy.
The Smoot-Hawley Act of 1930 marked a significant shift in American politics by highlighting the consequences of protective tariffs on the economy.
Historical tariff policies reveal ongoing tensions between American agricultural and industrial interests, showcasing the complexities of trade debates in politics.
The podcast emphasizes the evolving power dynamics between Congress and the presidency, raising concerns about unilateral actions in current tariff discussions.
Deep dives
Identity Theft and Protection Solutions
Identity theft is a significant issue, with a victim occurring every five seconds in the U.S. This alarming statistic highlights the need for effective identity protection services. One solution mentioned is LifeLock, which monitors vast amounts of data to detect threats to personal information. If an individual's identity is compromised, LifeLock guarantees assistance from a U.S.-based restoration specialist to resolve the issue.
Historical Context of Tariffs in America
The podcast delves into the Smoot-Hawley Act as a pivotal moment in U.S. tariff history. This legislation marked the last major attempt by the American government to impose protective tariffs, reflecting the country's shift towards protectionism in the late 19th and early 20th centuries. The episode also references prominent tariff policies from earlier eras, such as the McKinley Tariff, which sought to protect U.S. industries but faced fierce political battles. Understanding these historical precedents is crucial for analyzing present tariff discussions.
Political Dynamics and Tariff Policy Battles
The complexity of tariff politics is illustrated through the fierce debates between the Democratic and Republican parties. While industrial interests rallied around protective tariffs, agricultural producers often opposed them, advocating for free trade to support their export economies. The podcast emphasizes how legislators historically engaged in political maneuvering, trading tariff protections for political favors to secure local interests. This illustrates a persistent tension in American politics regarding the balance between protecting domestic industries and engaging in international trade.
The Impact of Economic Crisis on Tariff Legislation
The episode discusses how the stock market crash of October 1929 influenced tariff legislation, particularly the passing of the Smoot-Hawley Act in 1930. Faced with economic panic, lawmakers saw protectionist measures as a reflexive response to safeguard against further economic decline. However, the resulting retaliatory tariffs from other nations quickly escalated the economic situation, plunging the world into the Great Depression. This unintended consequence highlights the complexities and risks involved in tariff policymaking during times of crisis.
Congressional Power and the Presidency's Role in Tariff Decisions
A significant theme of the podcast is the evolving power dynamics between Congress and the presidency regarding tariff decisions. The Smoot-Hawley Act marked a turning point, leading to greater presidential authority over trade policies, reflecting a shift from congressional control. The discussion suggests that current tariff debates under different administrations may mirror past experiences, with concerns about the president pursuing unilateral action without congressional oversight. This historical lens raises questions about the future roles and responsibilities of both branches of government in economic policymaking.
David talks to historian Gary Gerstle about the last time the Republican party got caught up in a tariffs disaster and how it changed American politics. The Smoot-Hawley Act of 1930 brought tariffs back and helped bring down both the Republican Party and the global economy. Why didn’t Hoover stop it? What did the fiasco reveal about the limits of presidential power back then? And what does it suggest about the limits of presidential power today?
Next time on Ideas of Globalisation: Central Banks vs the People (and Trump!)
