The Tariff
We reaffirm our belief in the protective tariff to extend needed protection to our productive industries. We believe in protection as a national policy, with due and equal regard to all sections and to all classes. It is only by adherence to such a policy that the well being of the consumers can be safeguarded that there can be assured to American agriculture, to American labor and to American manufacturers a return to perpetrate American standards of life. A protective tariff is designed to support the high American economic level of life for the average family and to prevent a lowering to the levels of economic life prevailing in other lands.
In the history of the nation the protective tariff system has ever justified itself by restoring confidence, promoting industrial activity and employment, enormously increasing our purchasing power and bringing increased prosperity to all our people.
The tariff protection to our industry works for increased consumption of domestic agricultural products by an employed population instead of one unable to purchase the necessities of life. Without the strict maintenance of the tariff principle our farmers will need always to compete with cheap lands and cheap labor abroad and with lower standards of living.
The enormous value of the protective principle has once more been demonstrated by the emergency tariff act of 1921 and the tariff act of 1922.
We assert our belief in the elastic provision adopted by congress in the tariff act of 1922 providing for a method of readjusting the tariff rates and the classifications in order to meet changing economic conditions when such changed conditions are brought to the attention of the president by complaint or application.
We believe that the power to increase or decrease any rate of duty provided in the tariff furnishes a safeguard on the one hand against excessive taxes and on the other hand against too high customs charges.
The wise provisions of this section of the tariff act afford ample opportunity for tariff duties to be adjusted after a hearing in order that they may cover the actual differences in the cost of production in the United States and the principal competing countries of the world.
We also believe that the application of this provision of the tariff act will contribute to business stability by making unnecessary general disturbances which are usually incident to general tariff revisions.
You keep repeating that like it's some kind of mantra. It won't work because a lot of people won't be able to afford to keep buying the stuff when the price goes up 20%. For most Americans, the immediate effect is going to be a substantial reduction in their standard of living.
End users pay all tariffs and taxes levied against goods and services.
That would be us.
Wasn’t this tried with Smoot-Hawley?
And look at the result.
Actually, no. It would in theory raise $320B, while the current deficit is around $500B.
Regardless, the impact of such a tariff would be an average tax increase of about $2,500 per household, representing a reduction of economic activity of about 5%.
A 20% tariff instead of an income tax is one thing. A 20% tariff on top of an income tax is something else.
This is why it is so hard to reduce the deficit by increasing taxes of any type.