• Douglas A. Irwin, Peddling Protectionism: Smoot-Hawley and the Great Depression, Princeton, N.J: Princeton University Press, 2011, 244 pages, $24.95

Willis Hawley, a Republican from Oregon in the U.S. House of Representatives, promised that the bill would create “a renewed era of prosperity.” Reed Smoot, a Republican from Utah in the U.S. Senate, claimed “the Depression would have been worse without the higher tariff.” They were selling the legislation bearing their names.

Douglas A. Irwin’s Peddling Protectionism re-evaluates the Smoot-Hawley tariff and its role in the Great Depression, dispelling some long-held myths. One “popular perception” of Smoot-Hawley is that American producers agitated for protection from imports. Irwin’s review of the history shows this to be wrong. Although some farmers wanted higher tariffs, others preferred price floors, subsidies, or even lower tariffs. Failing to make these policies into law, Midwestern Republicans hatched the idea of raising tariffs on agricultural imports.

The Republican Party incorporated this strategy into their 1928 platform, hoping to win the votes of farmers. Republicans retained their congressional majorities and Herbert Hoover became President. The revision of the tariff code metastasized into the Smoot-Hawley Tariff Act of 1930.

Irwin’s longest chapter is the story of how Smoot-Hawley was made. Congress is predisposed to restrict trade because “the benefits of a tariff are highly concentrated on a few producers who are strongly motivated to organize and defend that policy; whereas the costs of tariffs are spread widely among many consumers for whom it does not pay to organize any serious opposition.”

Tariffs were popular. Occasionally, producers who imported products clashed with domestic producers of those products. Cattlemen, for example, wanted higher tariffs on imported leather but manufacturers of footwear opposed them. “Such conflicts were usually resolved,” explains Irwin, “by offering higher tariffs to both sides.”

Logrolling raged in the Senate. Smoot, for instance, “convinced nine senators to change their vote on the sugar tariff in a vote-trading deal in which greater protection would also be given to lumber, oil, cement, and glass.” Eighteen months after deliberations began, the House and Senate passed their reconciled version of the bill in June 1930 and Hoover signed it.

Another “popular perception” is that the Smoot-Hawley tariffs were astronomical and caused the Great Depression. Irwin shows this to be wrong, too: “[T]he best guess is that [Smoot-Hawley] probably raised the average tariff on dutiable imports by about 15-18 percent, an increase of about 6 percentage points,” Irwin says. “Historically, the Smoot-Hawley increase was not extreme.”

Nor was the effect on imports. The tariff did cause imports to fall during the early 1930s, but the combination of deflation and the tariff contributed to this reduction in trade. “Most of the decline in imports — about two-thirds — was the result of a decline in demand resulting from falling income,” Irwin notes. “The consensus among economic historians,” he reports, “is that monetary and financial factors were the dominant factors behind the Great Depression in the United States.”

That said, the “popular perception” that Smoot-Hawley provoked foreign governments into retaliating with their own tariffs against American exports is “largely accurate,” Irwin concludes. The tariff was not the only reason protectionist policies broke out around the world, however. Irwin maintains that Britain’s abandonment of the gold standard in 1931, making its exports cheaper, induced other countries to impose protectionist measures. Governments also blocked imports as economic depression spread throughout the world, Smoot-Hawley notwithstanding.

“But although Smoot-Hawley was not entirely responsible for the massive outbreak of protectionism in the early 1930s,” concludes Irwin, “it certainly contributed to the climate in which such policies flourished.”

A few passages read like an academic journal. On the other hand, 17 editorial cartoons throughout the book educate and entertain. By reading Irwin’s enlightening account, one may learn a lot about history, economics, and the grisly process of making legislation.