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The '''Smoot-Hawley Tariff''' was a high U.S. tariff enacted in 1930.  It raised tariffs on imports to "protect" American manufacturers and prevent American jobs from being lost. The effort did not have its promised effect, and [[unemployment]] skyrocketed from single digits to nearly one-quarter of the country.

The '''Smoot-Hawley Tariff''' was a high U.S. tariff enacted in 1930.  Smoot and Hawley were the Republican tariff experts in Senate and House, and they though that it would help the economy by protecting American manufacturers from imports and prevent American jobs from being lost. The higher tariff was supported by leading spokesmen for agriculture and industry.

* The unemployment rate stood at 6.3% in June 1930 — eight months after the [[stock market crash]] — when the Smoot-Hawley tariffs were passed. A year later, the unemployment rate was 15% — and a year after that it was 25.8%.<ref>[http://www.investors.com/NewsAndAnalysis/Article.aspx?id=518457 Massive Government Intervention Drove U.S. Deeper Into Depression]</ref>

The effort backfired as Canada and other major trading partners retaliated and put higher tariffs on goods made in America. American foreign trade fell by 40%.

 

It is criticized by nearly all economists at the time and since as a huge mistake; many consider it partly responsible for the [[Great Depression]]. However, foreign trade was a small part of the U.S. economy (4%), so the decline in that sector could only have been a small part of the overall decline.

It is criticized by nearly all economists as a huge mistake; many consider it partly responsible for the [[Great Depression]]. See .

* Judith A. McDonald, Anthony Patrick O'Brien and Colleen M. Callahan. "Trade Wars: Canada's Reaction to the Smoot-Hawley Tariff," ''Journal of Economic History,'' Vol. 57, No. 4 (Dec., 1997), pp. 802-826 [http://www.jstor.org/stable/2951161 in JSTOR]

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