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→Modern Tariffs
==Modern Tariffs==
In the late 18th century United States, tariffs were seen as a way for the federal government to generate revenue, as income and other forms of federal taxes had yet to be established. By the early 20th century, political parties were beginning to take sides in the debates about tariffs. The Tariff of 1789 was one of the first policies enacted that stipulated the rates and types of tariffs in the United States. Throughout much of the early 19th century, the United States generally kept low tariffs. The South of the United States, in particular, supported very low tariffs. When the federal government attempted to raise tariffs in 1828, the state of South Carolina threatened full rebellion against the federal government. Economic exports of cotton in particular would have been threatened by higher tariffs. After the 1850s, however, with economic hardship that also occurred after the Civil War, gradually most of the country supported high tariffs on goods. This trend continued through the two World Wars. The United States was largely seen as a protectionist economy that made it difficult for foreign countries to penetrate the US market. During the early 19th century, the Whigs supported high tariffs, whereas it was the Democrats who supported low tariffs. From the late 19th century, Europe and the United States were seen as largely became almost complete separate economies that had little interaction. Tariffs in the United States ranged between 40-50 percent, while it was 9-12 percent in Europe. After the 1930s Great Depression, most countries expanded tariffs and global trade was severely limited as countries tried to protect their domestic industries that were strugglingfrom economic slow-down. Economists still debate if tariffs exacerbated the Great Depression. The Smoot–Hawley Tariff Act of 1930 exemplified thisprotectionist attitudes, with over 10,000 items listed in tariffs. This did cause retaliatory measures by different countries, including Canada, which shifted much a lot of its trade to the British Empirein large part due to the tariff.<ref>For more on the early history of US tariffs, see: Taussig, F. W. 2005. <i>The Tariff History of the United States</i>. Chestnut Hill, Mass.: Elibron Classics. </ref>
[[File:File-20170720-24017-1hxq3ej.jpg|thumb|Figure 2. The Corn Laws were tariffs on agricultural grains which intended to expand domestic production of food. However, the tariffs impeded aid to Ireland, leading to their eventual removal.]]