Trump far from first protectionist in the White House

3 min

Washington (AFP)

A protectionist president for the land of the free market: Donald Trump's new direction for the US economy may seem incongruous but restraints on trade have a long history in the White House.

Long before Trump ever threatened China and Mexico with trade barriers, other American presidents had also resorted to protectionism, especially members of the Republican Party which strongly favors trade liberalization today.

The revered Ronald Reagan slapped 45 percent tariffs on larger Japanese motorcycles in 1983, a time when Americans accused Japan of flooding the United States with cheap goods.

Four years later, Reagan, who championed free markets in opposition to the Soviet planned economy, put 100 percent duties on some Japanese imports of televisions and computers after having already imposed import quotas on Japanese cars and steel.

In 1971, Republican Richard Nixon ended the convertibility of the US dollar to gold and imposed a 10 percent surcharge on imports to encourage trading partners to revalue their currencies.

- 'A high tariff party' -

Having faded from memory behind the triumph of free-trade ideology over the last 25 years, these bouts of protectionism nevertheless hark back to the roots of the Republican Party.

"Going back to its founding and during decades, the Republican Party has been a high tariff party and it was based on the idea that the US needed to develop its industrial capacity," said Eric Rauchway, a historian at the University of California.

Founded in 1854, the Grand Old Party was at the time close to the captains of industry in the northeast who sought protection against imports from the main economic power of the day, Britain.

Dominating control of the White House until just before World War II, the party went on to create a "wall of tariffs" to shield nascent US industries, according to Michael Lind, author of the US economic history "Land of Promise."

This policy was not without its detractors.

Supported by the Democratic Party, major Southern plantations -- an industry founded on slavery -- called for free trade, which would allow them to sell cotton to the British and import industrial equipment that was cheaper than domestically produced equivalents.

Under Republican leadership, however, US protectionism became entrenched policy in the first half of the 20th century, even intensifying in the years before and during the Great Depression.

The Smoot-Hawley Act of 1930 raised tariffs on more than 20,000 imported goods, worsening the economic woes of the day.

And relics of the era have survived into the present. The Buy American Act of 1933 requires the federal government to favor purchases of US-made goods.

With the European and Japanese industrial bases devastated in the wake of World War II, the United States shifted radically to a new paradigm.

"The Republican business elite and the industrialists switched to free trade because there was no longer competition. At the time, the US had a monopoly of world manufacturing," said Lind.

- 'Defensive protectionism' -

Currents of protectionism next occurred in the 1970s, when the industries of Japan and Germany had again found their footing. They arose again in the 1980s, with the United States suffering a deep recession from 1980 to 1982.

"There's always been a seductive quality to this idea that in the face of an economic crisis we should revert to some kind of protectionist policy," said Rauchway.

As the United States grew stronger, American protectionism nevertheless changed appearances, becoming less concerned with incubating local industry than with keeping out cheaper products.

By taking on China and withdrawing from the Trans-Pacific Partnership, Trump seems to have adopted this line of thinking.

"This is the defensive protectionism that Donald Trump is reviving," said Lind.