Smoot-Hawley Tariff of 1930: A Counterfactual Analysis

Before delving into this counterfactual analysis of the Smoot-Hawley Tariff, it is helpful to review the following timeline to learn the actual events as they happened in history.

Date	Domestic	International
1916	Revenue Act establishes Tariff Commission, charged with advising Congress on tariff matters.
1919	Constitutional amendment enacting Prohibition goes into effect.
1922	Fordney-McCumber Tariff becomes law. Flexible tariff provision gives Tariff Commission responsibility for determining costs of production; President is allowed to revise rates by up to 50% to equalize costs of production.
1927		The Fiat Company, Italy's leading automobile manufacturer, begins pushing Italian government to increase duties on American automobiles and automobile parts, out of frustration for losing to American competition.
1928	Republicans and Democrats both campaign on protectionist platforms. Herbert Hoover is the Republican candidate for President; the Democratic Party nominates Al Smith.	Italian deficit with the United States grows from $115.7M to $174.6M.
Nov. 6, 1928	Hoover is elected president, carrying 40 of 48 states. Republicans do well in the congressional elections: +30 in House for 267-167 majority, +7 in Senate for 56-39 majority.
Dec. 5, 1928	House Ways & Means Committee authorizes notice of public hearings on tariff. Fourteen subcommittees will take testimony, and hearings will cover all commodities.
1929		Italian media launches campaign against purchasers of American automobiles and automobile parts. Representatives from various Swiss industries begin circulating flyers encouraging the support of European automobiles and other products, while avoiding the support of American industries.
Jan. 7, 1929	House Ways & Means Committee begins hearings. Rep. Willis Hawley (R-OR) is chair.
Feb. 27, 1929	House Committee hearings conclude, after nearly 20,000 pages of testimony and 1100 witnesses.
Mar. 4, 1929	Hoover is inaugurated. Inaugural address calls for limited tariff revisions.
March 8, 1929		Canada proclaims its Canada First policy, that in the interests of Canadian industries, Canada will not seek to continue trading with the United States if the United States continues to show resentment and antagonism with regards to trade with Canada.
Apr. 15, 1929	Extra congressional session convenes (71st Cong., 1st session), called by Hoover to help farmers and make limited tariff changes.
May 7, 1929	Bill is reported to House by the Ways & Means Committee, having been written entirely by Republican members of the committee. Some Republicans are unhappy: agricultural states want higher rates on butter/casein/flaxseed, lower rates on brick/cement/lumber/shingles; California wants duties on figs/dates/hides/long staple cotton; the Northeast wants duties on boots/shoes/leather; etc.	At this time, no official protests have been received from foreign nations.
May 23, 1929	Republican committee members come up with ninety-one compromise amendments designed to guarantee Republican unity.
May 28, 1929	Tariff bill is passed by House 264-147. Only 12 Rs vote against; 20 Ds vote for.
May 29, 1929	Bill is referred by Senate to Finance Committee. Sen. Smoot (R-UT) is chair.
June 13, 1929	Senate Finance Committee begins hearings.
June 17, 1929	Sen. Borah (R-ID) moves for “sense of the Senate” resolution to have tariff revision limited to agriculture; fails 39-38. Hoover notes that he convened Congress in order to pass limited changes, but “in considering the tariff for other industries than agriculture, we find that there have been economic shifts necessitating a readjustment of some of the tariff schedules.”
June 19, 1929	Congress takes recess for summer. Senate Finance Committee continues working on tariff bill.
July 18, 1929	Senate Finance Committee hearings conclude.	To date, a total of 38 nations have sent formal protests against the Tariff to the Department of State
July 22, 1929	Senate Finance Committee begins meeting in executive session to redraft bill.
Sept. 4, 1929	Senate ends summer recess; redrafted bill reported to Senate.
Sept. 12, 1929	Debate begins in Senate.
Oct. 2, 1929	Senate passes amendment removing President’s ability to set flexible tariff schedules; instead, Tariff Commission’s recommendations will be acted on by Congress. Thirteen insurgent Rs join 34 Ds in passing amendment, 47-42.
Oct. 19, 1929	Senate passes amendment adding farm debenture rider to tariff bill. Debentures will provide export subsidies for farmers. Fourteen insurgent Rs join 28 Ds in passing amendment, 42-34.
Oct. 22, 1929	Senate finishes debating administrative provisions, moves on to rates. Coalition of Ds + insurgent Rs is in control, forces (mostly) lower rates.
Oct. 29, 1929	Stock market crashes on Black Tuesday. The Dow-Jones Industrial Average drops 12% as 16.4 million shares are traded.
Nov. 22, 1929	Despite Hoover’s urgings, Senate adjourns without passing tariff bill.
Dec. 2, 1929	Regular congressional session convenes (71st Cong., 2d session).
Dec. 11, 1929	Former tariff lobbyist Joseph Grundy is appointed as Pennsylvania's junior Senator.
Jan. 17, 1930	After six days of debate, Senate votes to reject House’s proposed tariff raises on sugar. Vote is 48-38; eighteen insurgent Rs join 29 Ds.
Mar. 5, 1930	Amid charges of vote trading, Senate reverses position on sugar; 38 Rs and 9 Ds vote to raise sugar tariffs.
Early Mar. 1930	Coalition of sugar, oil, lumber, and cement interests gain control in Senate; they start raising rates on numerous commodities, including items already voted on previously.
Mar. 22, 1930	Revision completed in Senate.
Mar. 24, 1930	Senate passes bill, 53-31. Five Rs vote against; 7 Ds vote for.
Apr. 2, 1930	Bill sent to conference committee.
May 5, 1930	1028 American economists send letter to President Hoover asking him to veto tariff bill.
May 13, 1930	Conferees deadlock: Senate has instructed its conferees to keep debenture plan and strike down flexible provision, but House has voted to strike out debenture plan and keep flexible provision.	To date, 33 nations have sent formal protests to Congress in opposition of the Tariff.
May 19, 1930	Senate agrees to recede: debenture plan is struck down by 43-41 vote, and VP Curtis casts deciding vote after 42-42 vote on flexible provision.
June 9, 1930	After some back-and-forth between conference and Senate, completed conference report is filed.	To date, 59 nations have sent formal protests to Congress in opposition of the Tariff.
June 13, 1930	Senators Reed and Grundy criticize conference report but decide to accept. Senate adopts conference report, 44-42.
June 14, 1930	House adopts conference agreement, 222-153. Vote is largely along party lines: only 14 Ds vote for, only 20 Rs vote against.
June 16, 1930	VP Curtis signs bill; bill is forwarded to Pres. Hoover.
June 17, 1930	Pres. Hoover signs bill and issues signing statement.
June 18, 1930	Tariff goes into effect at 12:01 a.m.	Word begins to travel through Switzerland to boycott American products.
June 30, 1930		Italy sharply increases its automobile tariffs.
July 22, 1930		Spain passes Wais Tariff of 1930, effective the next day.
Nov. 1930		France signs concession treaty with Spain, thereby negating the effects of the Wais Tariff on France.
Sept. 17, 1930		Canada enacts Canadian Emergency Tariff, increasing tariffs virtually across the board by 50%.
Summer 1931		France adopts quota system.
Nov. 30, 1931		Great Britain enacts Abnormal Importations Act, allowing the Board of Trade the ability to adjust duties up to 100% on any product it wishes.
Feb. 1932		Great Britain enacts Import Duties Act, imposing a general tariff of 10%.
Mar. 1932		Italy signs concession treaty with Spain, thereby negating the effects of the Wais Tariff on Italy.