Dingley Tariff

DINGLEY TARIFF

Passed by Congress in July 1897, the Dingley Tariff Act increased duties by an average of 57 percent. Tariff rates were hiked on sugar, salt, tin cans, glassware, and tobacco, as well as on iron and steel, steel rails, petroleum, lead, copper, locomotives, matches, whisky, and leather goods.

Protective tariffs figured prominently in nineteenth century political debates. Tariffs were used in the United States as early as the 1790s. In 1828 Congress passed a bill (called the "Tariff of Abominations" by its opponents) levying government taxes on imported goods as a way of protecting the nation's burgeoning industrial interests. Thereafter tariffs were adjusted depending on current economic conditions and the political atmosphere. Republicans came to stand for higher tariffs, while the Democrats, leery that such protectionism favored monopolistic business practices in U.S. industry, championed lower rates. Since the Republicans controlled the government for most of the period between 1860 and 1890, tariffs remained high.

The presidential election of 1896, which pitted Republican candidate William McKinley (1843–1901) against Democrat William Jennings Bryan (1860–1925) was dominated by the debate over Free Silver, but the subtext of the debate centered about the tariff issue. Since they knew him to be a strong advocate of protection, the Republicans chose McKinley as their candidate. (Indeed, in 1890, McKinley had sponsored a high tariff, which bore his name.) McKinley saw the collection of tariffs as an effective way to replenish the U.S. Treasury. After winning the election he wasted no time in bringing the issue to the fore.

Calling a special session of Congress in March 1897, President McKinley (1897–1901) worked with House speaker, Thomas Brackett Reed (1839–1902), and the Ways and Means Committee Chairman, Nelson Dingley (1832–1899), to pass tariff-increase legislation in near-record time: three weeks after convening, the House passed the bill. When it reached the Senate, the moderate increases sought by McKinley were raised sharply, to an average 57 percent. The rate hike was the result of a coalition formed between eastern and western senators who agreed to higher rates on goods produced by their respective regions in exchange for the support of another region. The Dingley Tariff was the highest protective tariff in U.S. history. The legislation's effect was to raise the cost of living by nearly 25 percent between 1897 and 1907. The cost of living was mitigated only by an influx of gold from the Klondike (Yukon Territory, Canada), which helped end a four-year economic depression and begin a decade of prosperity.

The tariff was not lowered until 1913 when the Underwood Tariff reduced rates to approximately 30 percent. That same year, the ratification of the Sixteenth Amendment, which provided for a federal income tax, helped alleviate pressure for high tariffs by providing the federal government with another stream of revenue.

See also: Tariff, Underwood Tariff