On this day in 1930 U.S. President Herbert Hoover signed the Smoot-Hawley Tariff Act into law.
The Tariff Act of 1930 otherwise known as the Smoot–Hawley Tariff or Hawley–Smoot Tariff, was an act sponsored by Senator Reed Smoot and Representative Willis C. Hawley and signed into law on June 17, 1930, that raised U.S. tariffs on over 20,000 imported goods to record levels.
The dutiable tariff level under the act was the highest in the U.S. in 100 years, exceeded by a small margin by the Tariff of 1828.
Some view the Act, and the ensuing retaliatory tariffs by U.S. trading partners, as responsible for reducing American exports and imports by more than half.
According to Ben Bernanke, “Economists still agree that Smoot-Hawley and the ensuing tariff wars were highly counterproductive and contributed to the depth and length of the global Depression.”
Alfred E. Eckes, Jr., chairman of the International Trade Commission in the Reagan era, discounts this and states that Smoot-Hawley had little effect on the severity of the Great Depression.