[neodad]

It has an eerie feeling of Hawley-Smoot and 1929, where a very, very bad bill seemed to have its own momentum and no one could stop it.

In 1930, the Republican-controlled House of Representatives, in an effort to alleviate the effects of the... Anyone? Anyone?... the Great Depression, passed the... Anyone? Anyone? The tariff bill? The Hawley-Smoot Tariff Act? Which, anyone? Raised or lowered?... raised tariffs, in an effort to collect more revenue for the federal government. Did it work? Anyone? Anyone know the effects? It did not work, and the United States sank deeper into the Great Depression.

Memorable Quotes from Ferris Bueller's Day Off

[The South Texan]

The Protectionist wing of FR needs to see that quote.

[Koblenz]

Ben Stein ad-libbed that whole sequence...

[LS]

The problem with Ben Stein's monologue is that the KEY VOTE on Hawley Smoot occurred on October 28, 1929, meaning that the market crash was the result of HS rather than being a reaction to it, and falling revenues.

[Old_Mil]

Smoot-Hawley: Myth and Reality

"While Smoot-Hawley did raise the average tariff rate to 53% in 1930 and to 59% in 1932, the Tariff of Abominations of 1828 produced a rate of 62% in 1830. But Smoot-Hawley applied to only one-third of all U.S. imports. Compare that to the Tariff of Abominations which applied to 92% of all imports, the Morill tariff (96%), the McKinley tariff (48%), and the Dingley Tariff (55%). The list of duty-free imports under Smoot-Hawley was the longest in history.

Considering Smoot-Hawley duties as a percentage of all imports, it ranks, in impact on trade, below every single post-Civil War tariff except the Underwood Tariff of 1913.

What of the second charge -- that the anticipation of Smoot-Hawley caused the stock market crash eight months before the act became law? In the spring of 1930 -- after Smoot-Hawley had broken through its opposition on the Hill and was headed to certain passage -- the stock market was headed due north. Eckes shows the market often rising as Smoot-Hawley's prospects improve, and falling when Smoot-Hawley appears on the ropes...

Moreover, how much adverse effect could Smoot-Hawley have had on the U.S. economy as a whole, when total imports in 1930 added up to only 4% of the GNP, and Smoot-Hawley applied to only a third of that, or to 1.3% of the GNP?

Is it conceivable that an increase in tariffs on 1.3% of the GNP triggered the collapse of five-thousand banks, wiped out five-sixths of the stock market, caused a drop of 46% in the GNP, and sent unemployment soaring to 25%?"

Obviously not. The reason for the Great Depression had everything to do with money supply and margins, not Smoot-Hawley. I hope that is instructive for those of you free-traders who learned economics from Ferris Bueller's Day Off.