[Samseau]

(03-11-2016 11:22 AM)Libertas Wrote:  

We might also want to go into detail about those 19th century tariffs durinc which time America rose to be the world's greatest industrial power.

How are those different from Smoot or what Trump is proposing?

Blaster's posts above show how it was different.

Back when America was founded, British Mercantilist policies apparently did many of the same things China is doing today:

- British workers were paid less than most slaves
- The dumping of cheap goods would kill American businesses
- The British government picked winners and losers of industry with low-interest loans and favorable regulations for big businesses but nothing for anyone else

From Blaster's Ben Franklin link above, the British worker was cheaper than American slaves:

Quote:

12. Tis an ill-grounded opinion that by the labour of slaves, America may possibly vie in cheapness of manufactures with Britain. The labour of slaves can never be so cheap here as the labour of working men is in Britain. Any one may compute it. Interest of money is in the Colonies from six to ten per Cent. Slaves one with another cost thirty . Sterling per head. Reckon then the interest of the first purchase of a slave, the Insurance or risque on his life, his cloathing and diet, expenses in his sickness and loss of time, loss by his neglect of business. (Neglect is natural to the man who is not to be benefited by his own care or diligence), Expence of a Driver to keep him at work, and his pilfering from time to time, almost every slave being by Nature a thief, and compare the whole amount with the wages of a manufacturer of iron or wool in England, you will see that labour is much cheaper there than it ever can be by negroes here. Why then will Americans purchase slaves? Because slaves may be kept as long as a man pleases, or has occasion for their labour; while hired men are continually leaving their master (often in the midst of his business,) and setting up for themselves.

So the obvious answer was tarrifs and it worked very well to protect themselves from the corrupt British markets, and the American government raised so much $$$ from tariffs they didn't even think about stuff like income taxes.

Tariffs can be used property to shield a country's market from corruption of other countries, or they can be abused to protect industries within a country and create corruption at home. Just like anything they can be used for good or bad, a distinction that classical economists never considered due to limited information they had on banking and currency manipulation in the 19th century.

If Von Mises or Hayek were alive today, I am confident I could convince either of them to revise their position on tariffs.