45-551: The Tariff Act of 1930 (codified at 19 U.S.C. ch. 4 ), commonly known as the Smoot–Hawley Tariff or Hawley–Smoot Tariff , was a law that implemented protectionist trade policies in the United States. Sponsored by Senator Reed Smoot and Representative Willis C. Hawley , it was signed by President Herbert Hoover on June 17, 1930. The act raised US tariffs on over 20,000 imported goods. The tariffs under
90-505: A 1929 high of $ 1.3 billion to just $ 390 million during 1932, and US exports to Europe decreased from $ 2.3 billion in 1929 to $ 784 million in 1932. Overall, world trade decreased by some 66% between 1929 and 1934. Unemployment was 8% in 1930 when the Smoot–Hawley Act was passed but the new law failed to lower it. The rate jumped to 16% in 1931 and 25% in 1932–1933. There is some contention about whether this can necessarily be attributed to
135-415: A bill has been passed by a conference committee, it goes directly to the floor of both houses for a vote, and is not open to further amendment. In the first house to consider the conference report, a member may move to recommit the bill to the conference committee. But once the first house has passed the conference report, the conference committee is dissolved, and the second house to act can no longer recommit
180-482: A case, the rules of each House let a member object through a point of order , though each House has procedures that let other members vote to waive the point of order. The House provides a procedure for striking the offending provision from the bill. Formerly, the Senate required a senator to object to the whole bill as reported by the conference committee. If the objection was well-founded, the presiding officer ruled, and
225-415: A conference, and appoints conferees. Each house determines the number of conferees from its house. The number of conferees need not be equal. To conclude its business, a majority of both House and Senate delegations to the conference must indicate their approval by signing the conference report. The authority to appoint conferees lies in the entire House, and the entire Senate appoints conferees by adopting
270-590: A consensus view that the passage of the Smoot–Hawley Tariff worsened the effects of the Great Depression. The League of Nations ' World Economic Conference met at Geneva in 1927, concluding in its final report that "the time has come to put an end to tariffs , and to move in the opposite direction". Vast debts and reparations could be repaid only through gold, services, or goods, but the only items available on that scale were goods; however, many of
315-399: A debatable motion to do so, but leadership have increasingly exercised authority in the appointment of conferees. The House and Senate may instruct conferees, but these instructions are not binding. Conference committees can be extremely contentious, particularly if the houses are controlled by different parties. House rules require that one conference meeting be open to the public, unless
360-710: A lecture to his students. It is also heavily featured in the 1989 book Dave Barry Slept Here: A Sort of History of the United States by Dave Barry . Title 19 of the United States Code Title 19 of the United States Code outlines the role of customs and duties in the United States Code . This United States federal legislation article is a stub . You can help Misplaced Pages by expanding it . United States congressional conference committee A conference committee
405-526: A majority, rather than as a treaty requiring a two-thirds vote. This was one of the core components of the trade negotiating framework that developed after World War II. After World War II, that understanding supported a push towards multilateral trading agreements that would prevent similar situations in the future. While the Bretton Woods Agreement of 1944 focused on foreign exchange and did not directly address tariffs, those involved wanted
450-440: A senator could appeal the ruling of the chair. If the appeal was sustained by a majority of the Senate, it had precedential effect, eroding the rule on the scope of conference committees. From fall 1996 through 2000, the Senate had no limit on the scope of conference reports, and some argued that the majority abused the power of conference committees. In December 2000, the Senate reinstated the prohibition of inserting matters outside
495-582: A similar framework for international trade . President Harry S. Truman launched this process in November 1945 with negotiations for the creation of a proposed International Trade Organization (ITO). As it happened, separate negotiations on the General Agreement on Tariffs and Trade (GATT) moved more quickly, with an agreement signed in October 1947; in the end, the United States never signed
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#1732764663918540-688: A speech, she referred to the Smoot–Hawley Tariff as "the Hoot–Smalley Act", misattributed its signing to Franklin D. Roosevelt , and blamed it for the Great Depression . The act has been compared to the 2010 Foreign Account Tax Compliance Act (FATCA), with Andrew Quinlan from the Center for Freedom and Prosperity calling FATCA "the worst economic idea to come out of Congress since Smoot–Hawley". The act received attention as Donald Trump pledged tariffs during his 2024 campaign . Prior to 2016,
585-400: A vote of 264 to 147, with 244 Republicans and 20 Democrats voting in favor of the bill. The Senate debated its bill until March 1930, with many members trading votes based on their states' industries. The Senate bill passed on a vote of 44 to 42, with 39 Republicans and 5 Democrats voting in favor of the bill. The conference committee then unified the two versions, largely by raising tariffs to
630-580: Is a joint committee of the United States Congress appointed by the House of Representatives and Senate to resolve disagreements on a particular bill. A conference committee is usually composed of senior members of the standing committees of each house that originally considered the legislation. The use of the conference committee process has steadily declined in recent decades. Sixty-seven conference reports were produced as recently as
675-614: Is paying for its ruthless destruction of life and property in the World War and for its failure to adjust purchasing power to productive capacity during the industrial revolution of the decade following the war ." Smoot was a Republican from Utah and chairman of the Senate Finance Committee . Willis C. Hawley , a Republican from Oregon , was chairman of the House Committee on Ways and Means . During
720-471: The 104th Congress (1995–97), falling to just zero in the 117th Congress (2021-2023) and one in the 118th Congress (2023-2025). Conference committees operate after the House and the Senate have passed different versions of a bill. Conference committees exist to draft a compromise bill that both houses can accept. Both houses of Congress must pass identical legislation in order for a bill to be presented to
765-457: The 1928 United States presidential election , one of Herbert Hoover 's promises was to help beleaguered farmers by increasing tariffs on agricultural products. Hoover won, and Republicans maintained comfortable majorities in the House and the Senate during 1928. The House passed a version of the act in May 1929, increasing tariffs on agricultural and industrial goods alike. The House bill passed on
810-466: The Great Depression in the United States . The 1932 Democratic campaign platform pledged to lower tariffs. After winning the election, President Franklin D. Roosevelt and the now-Democratic Congress passed Reciprocal Trade Agreements Act of 1934. This act allowed the President to negotiate tariff reductions on a bilateral basis and treated such a tariff agreement as regular legislation, requiring
855-463: The White House trying to convince Hoover to veto the bill, calling it "an economic stupidity", while J. P. Morgan 's Chief Executive Thomas W. Lamont said he "almost went down on [his] knees to beg Herbert Hoover to veto the asinine Hawley–Smoot tariff". While Hoover joined the economists in opposing the bill, calling it "vicious, extortionate, and obnoxious" because he felt it would undermine
900-411: The House of Representatives passed it in May 1929, boycotts broke out, and foreign governments moved to increase rates against American products, although rates could be increased or decreased by the Senate or by the conference committee. By September 1929, Hoover's administration had received protest notes from 23 trading partners, but the threats of retaliatory actions were ignored. In May 1930, Canada,
945-407: The House, in open session, votes to close a meeting to the public. Apart from this one open meeting, conference committees usually meet in private, and are dominated by the chairs of the House and Senate committees. House and Senate rules forbid conferees from inserting in their report matter not committed to them by either House. But conference committees sometimes do introduce new matter. In such
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#1732764663918990-593: The ITO agreement. Adding a multilateral "most-favored-nation" component to that of reciprocity, the GATT served as a framework for the gradual reduction of tariffs over the subsequent half century. Postwar changes to the Smoot–Hawley tariffs reflected a general tendency of the United States to reduce its tariff levels unilaterally while its trading partners retained their high levels. The American Tariff League Study of 1951 compared
1035-529: The Tariff Act provided that "[a]ll goods, wares, articles, and merchandise mined, produced, or manufactured wholly or in part in any foreign country by convict labor or/and forced labor or/and indentured labor under penal sanctions shall not be entitled to entry at any of the ports of the United States" with a specific exception known as the "consumptive demand exception", which allowed forced labor-based imports of goods where United States domestic production
1080-570: The United States reduced its own. In the discussion leading up to the passage of the North American Free Trade Agreement (NAFTA), then-Vice President Al Gore mentioned the Smoot–Hawley Tariff as a response to NAFTA objections voiced by Ross Perot during a debate in 1993 they had on The Larry King Show . He gave Perot a framed picture of Smoot and Hawley shaking hands after its passage. In April 2009, then-Representative Michele Bachmann made news when, during
1125-414: The United States, Colonial Times to 1970, Bicentennial Edition", tariff rates have been represented in two forms. The dutiable tariff rate peak of 1932 was 59.1%, second only to the 61.7% rate of 1830. However, 63% of all imports in 1933 were not taxed, which the dutiable tariff rate does not reflect. The free and dutiable rate in 1929 was 13.5% and peaked under Smoot–Hawley in 1933 at 19.8%, one-third below
1170-459: The act, excluding duty-free imports, were the second highest in United States history, exceeded by only the Tariff of 1828 . The Act prompted retaliatory tariffs by many other countries. The Act and tariffs imposed by America's trading partners in retaliation were major factors of the reduction of American exports and imports by 67% during the Great Depression . Economists and economic historians have
1215-423: The average 29.7% "free and dutiable rate" in the United States from 1821 to 1900. The average tariff rate, which was applied on dutiable imports, increased from 40.1% in 1929 to 59.1% in 1932 (+19%). At first, the tariff seemed to be a success. According to historian Robert Sobel , "Factory payrolls, construction contracts, and industrial production all increased sharply." However, larger economic problems loomed in
1260-407: The bill committed to conference. The conference report also includes a joint explanatory statement of the conference committee. This statement provides one of the best sources of legislative history on the bill. Chief Justice William Rehnquist once observed that the joint conference report of both Houses of Congress is considered highly reliable legislative history when interpreting a statute. Once
1305-479: The bill to conference. Conference reports are privileged. In the Senate, a motion to proceed to a conference report is not debatable, although senators can generally filibuster the conference report itself. The Congressional Budget Act of 1974 limits debate on conference reports on budget resolutions and budget reconciliation bills to ten hours in the Senate, so senators cannot filibuster those conference reports. The conference report must be approved by both
1350-421: The commitment he had pledged to international cooperation, he eventually signed the bill after he yielded to influence from his own party, his Cabinet (who had threatened to resign), and business leaders. In retaliation, Canada and other countries raised their own tariffs on American goods after the bill had become law. Franklin D. Roosevelt spoke against the act during his campaign for President in 1932. Most of
1395-730: The country's most loyal trading partner, retaliated by imposing new tariffs on 16 products that accounted altogether for around 30% of US exports to Canada. Canada later also forged closer economic links with the British Empire via the British Empire Economic Conference of 1932, while France and Britain protested and developed new trade partners, and Germany developed a system of trade via clearing. The depression worsened for workers and farmers despite Smoot and Hawley's promises of prosperity from high tariffs; consequently, Hawley lost re-nomination, while Smoot
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1440-551: The decline in trade was due to a plunge in GDP in the US and worldwide. However, beyond that was additional decline. Some countries protested and others also retaliated with trade restrictions and tariffs. American exports to the protesters fell 18% and exports to those who retaliated fell 31%. Threats of retaliation by other countries began long before the bill was enacted into law in June 1930. As
1485-480: The delegates' governments did the opposite; in 1928, France was the first by passing a new tariff law and quota system. By the late 1920s, the US economy had made exceptional gains in productivity because of electrification , which was a critical factor in mass production . Another contributing factor to economic growth was motorcars, trucks, and tractors replacing horses and mules. One sixth to one quarter of farmland, which had been devoted to feeding horses and mules,
1530-502: The free and dutiable tariff rates of 43 countries. It found that only seven nations had a lower tariff level than the United States (5.1%), and eleven nations had free and dutiable tariff rates higher than the Smoot–Hawley peak of 19.8% including the United Kingdom (25.6%). The 43-country average was 14.4%, which was 0.9% higher than the U.S. level of 1929, demonstrating that few nations were reciprocating in reducing their levels as
1575-483: The guise of weak banks. When the Creditanstalt of Austria failed in 1931, the global deficiencies of the Smoot–Hawley Tariff became apparent. US imports decreased 66% from $ 4.4 billion (1929) to $ 1.5 billion (1933), and exports decreased 61% from $ 5.4 billion to $ 2.1 billion. GNP fell from $ 103.1 billion in 1929 to $ 75.8 billion in 1931 and bottomed out at $ 55.6 billion in 1933. Imports from Europe decreased from
1620-494: The higher levels passed by the House. The House passed the conference bill on a vote of 222 to 153, with the support of 208 Republicans and 14 Democrats. In May 1930, a petition was signed by 1,028 economists in the United States asking President Hoover to veto the legislation, organized by Paul Douglas , Irving Fisher , James T. F. G. Wood, Frank Graham , Ernest Patterson, Henry Seager , Frank Taussig , and Clair Wilcox . Automobile executive Henry Ford also spent an evening at
1665-402: The president. The two houses can reach that point through the process of amendments between Houses, where the House passes the Senate bill with a House amendment, or vice versa, but this process can be cumbersome. Thus, some bills pass both Houses through the use of a conference committee. After one house passes a bill, the second house often passes the same bill, with an amendment representing
1710-453: The rule. If the point of order is not waived and the chair rules that the objection is well-founded, only the offending provision is stricken from the measure, and the Senate votes on sending the balance of the measure back to the House. Most times, the conference committee produces a conference report melding the work of the House and Senate into a final version of the bill. A conference report proposes legislative language as an amendment to
1755-523: The scope of conference. The rule changed again with the Honest Leadership and Open Government Act , enacted in September 2007. Now any single senator may raise a point of order against subject matter newly inserted by the conference committee without objecting to the rest of the bill. Proponents of the measure may move to waive the rule. The affirmative vote of 60 senators is required to waive
1800-449: The second house's work product. The second house then sends a message to the first house, asking the first house to concur with the second house's amendment. If the first house does not like the second house's amendment, then the first house can disagree with the amendment of the second house, request a conference, appoint conferees, and send a message to that effect to the second house. The second house then insists on its amendment, agrees to
1845-521: The tariff. It was only during World War II , when "the American economy expanded at an unprecedented rate", that unemployment fell below 1930s levels. Imports during 1929 were only 4.2% of the US GNP, and exports were only 5.0%. Monetarists , such as Milton Friedman , who emphasized the central role of the money supply in causing the depression, considered the Smoot–Hawley Act to be only a minor cause for
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1890-506: The value of food imports were a little over half of the value of manufactured imports. As the global economy entered the first stages of the Great Depression in late 1929, the main goal of the US was to protect its jobs and farmers from foreign competition. Smoot championed another tariff increase within the United States in 1929, which became the Smoot–Hawley Tariff Bill. In his memoirs, Smoot made it abundantly clear: "The world
1935-503: Was freed up, contributing to a surplus in farm produce. Although nominal and real wages had increased, they did not keep up with the productivity gains. Senator Smoot contended that raising the tariff on imports would alleviate the overproduction problem, but the United States had actually been running a trade account surplus , and although manufactured goods imports were rising, manufactured exports were rising even faster. Food exports had been falling and were in trade account deficit, but
1980-547: Was not sufficient to meet consumer demand. The exception was removed under Wisconsin Representative Ron Kind 's amendment bill, which was incorporated into the Trade Facilitation and Trade Enforcement Act of 2015, signed by President Barack Obama on February 24, 2016. In the 1986 film, Ferris Bueller's Day Off , Ben Stein , playing a high school economics teacher, references the tariff in
2025-534: Was one of 12 Republican Senators who lost their seats in the 1932 elections , with the swing being the largest in Senate history (being equaled in 1958 and 1980 ). Nations other than Canada that enacted retaliatory tariffs included: Cuba, Mexico, France, Italy, Spain, Argentina, Australia, New Zealand, and Switzerland. In the two-volume series published by the US Bureau of the Census, "The Historical Statistics of
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