ment, he bought American goods at everyrnopportunity.rnHis idealistic successors, Thomas Jeffersonrnand James Madison, promotedrnfree trade in their early years in officernand experimented with trade sanctionsrnagainst Great Britain to remove its mercantilistrndiscriminations. Their rewardrnwas the War of 1812. The experiencernturned Jefferson, Madison, Monroe, andrntheir contemporaries into economic nationalsrnand led to what is known as thern”American System.” Under this policy,rnprotective tariffs were imposed againstrnforeign imports, not to tax consumers forrnthe benefit of producers, but to stimulaterninvestment in the United States andrnthercbv enable the country to producernits own goods and provide jobs forrnthe American people. This system wasrnAmerica’s policy from the early 1800’srnuntil the early 1930’s.rnBut as Eckes points out, the systemrnwas controversial. While Republicansrnpreached and practiced a nationalistrntrade policy in the period 1860 to 1930,rnthe Democrats vacillated between approvalrnof free trade and protection forrnworking people. Their problem was thatrnfree trade would break the power of thernprotected monopolies that financed thernRepublicans and would provide cheaprnconsumer goods, something they wanted.rnThe inflow of cheaper foreign goods,rnhowever, would also devastate theirrnworking class constituents, an outcomernthev had to avoid at all costs. For almostrnthree-quarters of a century, the Republicanrnposition prevailed at the polls and inrnCongress.rnDid the American System work? Atrnthe same moment that America was protectionist,rnGreat Britain, America’s greatrnindustrial rival, championed free trade.rnUsing comparative economic data fromrnboth countries, Eckes concludes thatrnthere is no significant relationship betweenrnhigh tariffs and real economicrngrowth. One fact is clear: the UnitedrnStates evolved from a small colony withrnlimited manufacturing capacity to thernmightiest industrial power in the worldrnunder protectionist policies. Eckes, howerner, refuses to give all the credit for thisrntransformation to trade nationalism. Hernidentifies a host of other contributoryrnfactors such as immigration, the developmentrnof a mass market, technologyrntransfer, high rates of domestic capitalrnformation, foreign investment, and a legalrnsystem that protects private property.rnBut he also points out that for Americansrnof that time “who could compare relativernopportunities for individuals on bothrnsides of the Atlantic, the American protectivernsystem appeared compatible withrnhigh wages, rising living standards, andrnrapid economic growth.” He also notesrnthat “during the heyday of British freerntrade from 1871 to 1890, about 68,000rnBritons emigrated annually to the UnitedrnStates seeking better economic opportunities.”rnThe election of Woodrow Wilson,rnwho ran for office in 1912 on a platformrnof low tariffs and free trade, spelled thernbeginning of the end for the AmericanrnSystem. Only days after being inaugurated,rnWilson summoned Congress into arnspecial session to enact tariff-reductionrnlegislation. The result was the Underwood-rnSimmons Tariff Act of 1913. Thisrnlegislation drastically reduced Americanrntariffs unilaterally without getting, withoutrneven requesting, any lowering of foreignrnbarriers to American exports. Thernresult was lower American tariffs, but alsorna government with little leverage tornconfront foreign discrimination againstrnAmerican exports.rnAs soon as Wilson was succeeded inrnoffice by Warren Harding, the new Presidentrncalled upon Congress to enactrnemergency tariff legislation. It zoomedrninto law. As Eckes describes in useful detail,rnthe Harding legislation tightly constrainedrnthe capacity of the UnitedrnStates to negotiate effectively a reductionrnin foreign trade barriers. The resultrnwas twofold: a coalition of Republicansrnand industrialists who wanted thernreestablishment of 19th-century tariffrnpatterns of the American System, and arncounter coalition, led by CongressmanrnCordcll Hull of Tennessee, advocating arnnew system of reciprocal tariff cuts, emphasizingrnexports.rnEventually, America got both. Inrn1930, Reed Smoot and Willis Hawleyrnshepherded through Congress the TariffrnAct of 1930—commonly known asrnSmoot-Hawley. In one of his most engagingrnchapters, Eckes effectively demolishesrnmost of the “lessons” three generationsrnof Americans have been taughtrnabout the Smoot-Hawley Act. No, hernpoints out, it did not cause the stockrnmarket crash of 1929, which occurredrnnine months prior to enactment of thisrnlegislation. No, Smoot-Hawley did notrninduce fierce retaliation and trade wars,rnor a spiraling decline in American trade.rnNo, Smoot-Hawley did not cost eitherrnSmoot or Hawley their offices in thern1932 election.rnNo one, of course, should be surprisedrnto learn that the myths of Smoot-Hawleyrnare still taught in most schools of economicsrnand political science and believedrnby most politicians. Just as mostrnbelievers in the Shroud of Turin are unlikelyrnto acknowledge, let alone accept,rnany modern proofs to the contrary, neitherrnare most free trade ideologues likelyrnto surrender the “lessons of Smoot-Hawley,”rnall of which stress free trade and internationalrnmultilateralism regardless ofrnthe cost to domestic industries and workers.rnFor all others, Eckes provides a convincingrnresponse.rnThe American System was finallyrndoomed with the elections of 1933rnand Franklin Roosevelt’s appointment ofrnCordcll Hull to be Secretary of State.rnNow all but forgotten, Hull had a profoundrninfluence on 20th-century America.rnA long-term Democratic member ofrnCongress, Hull, for instance, drafted thernconstitutional amendment that createdrnthe income tax (tariffs could never be reducedrnuntil an alternative source of federalrnrevenues was created). Most important,rnHull also authored, championed,rnand first administered the ReciprocalrnTrade Acts of the Roosevelt administration.rnIn the process, he single-handedlyrnchanged American history. Indeed, Eckesrndescribes by example after examplernhow the philosophy, policies, and coalitionsrnbehind most of America’s trade positionsrntoday can be traced directly tornCordcll Hull. It was Hull, for instance,rnwho realized that America’s negotiationrnof concessions granting foreign access forrna favored few industries, notably automobilesrnand agriculture, would result inrnthe formation of an export coalition thatrncould provide strong political support forrnhis policies and large political contributionsrnfor the Democratic Party. Therncoalition Hull created continues to dominaternAmerican trade policy and providesrnmuch of the money going to both parties.rnAnother example is Hull’s persuadingrnCongress to delegate to the ExecutivernBranch, and notably the StaternDepartment, its authority to negotiaternthe reduction of tariffs. More than 60rnyears later, the Executive Branch stillrnnegotiates American trade agreementsrnand all tariff reductions on behalf ofrnCongress. Once Hull had the delegatedrnnegotiating authority, he created anrnanonymous committee of bureaucratsrndrawn from the State Department, Agri-rnOCTOBER 1995/31rnrnrn