Walker tariff

The 1846 Walker tariff was a Democratic bill that reversed the high rates of tariffs imposed by the Whig-backed "Black Tariff" of 1842 under president John Tyler. It was one of the lowest tariffs in American history and primarily supported by Southern Democrats who had little industry in their districts.

The act is named after Robert J. Walker, a Mississippi politician who served as Secretary of the Treasury under president James K. Polk. The tariff's reductions (35% to 25%) coincided with Britain's repeal of the Corn Laws earlier that year, leading to a decline in protection in both and an increase in trade.

Adoption

Shortly after his election, President Polk asserted that the reduction of the "Black Tariff" of 1842, would constitute the first of the "four great measures", that would define his administration. This proposal was intended to be the fulfillment of his campaign pledge in the Kane Letter on tariff policy that contributed to his victory in 1844 over Henry Clay. In 1846 Polk delivered his tariff proposal, designed by Walker, to Congress. Walker urged its adoption in order to increase commerce between the United States and Britain. He also predicted that a reduction in overall tariff rates would stimulate overall trade, and with it imports. The result, asserted Walker, would be a net increase in tax revenue despite a reduction in the rates.

The Democratic-controlled Congress quickly acted on Walker's recommendations. The Walker Tariff bill produced the nation's first standardized tariff by categorizing goods into distinct schedules at identified ad valorem rates rather than assigning individual taxes to imports on a case-by-case basis. The bill reduced rates across the board on most major import items save luxury goods such as tobacco and alcohol.

Impact

The bill resulted in a moderate reduction in many tariff rates and was considered a success in that it stimulated trade and brought needed revenue into the U.S. Treasury, as well as improved relations with Britain that had soured over the Oregon boundary dispute. As Walker predicted, the new tariff stimulated revenue intake from $30 million annually under the Black Tariff in 1845 to almost $45 million annually by 1850. Exports to and imports from Britain rose rapidly in 1847 as both countries lowered their tariff barriers against each other.

It was passed along with a series of financial reforms proposed by Walker including the Warehousing Act of 1846. The 1846 tariff rates initiated a fourteen-year period of relative free trade by nineteenth century standards lasting until the high Morrill Tariff signed by James Buchanan in March 1861.

The Walker Tariff remained in effect until the Tariff of 1857, which used it as a base and reduced rates further.

External links

* [http://www.mises.org/etexts/taussig.pdf Taussig, Frank. "Tariff History of the United States" (1912)]