The Smoot Hawley Tariff Act

The smoot-hawley tariff act

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what was the smoot hawley tariff act?

The Smoot-Hawley Act, also known as Tariff Act of 1930, was a law that raised import duties (dazi) to protect American buisnesses and farmers.

Representative Willis Hawley and Senator Reed Smoot

What did it introduce?

This Act increased tariffs on foreign imports to the U.S. by about 20%. At least 25 countries responded by increasing their own tariffs on American goods.

It ended up causing a Trade War

What were the consequences?

The stock market reacted negatively:

• Imports became unaffordable for all but the wealthy
• decreased the amount of exported goods
• bank failures in agricultural regions

A change in direction:

In the 1932 elections, President Hoover was defeated by Franklin D. Roosevelt and both Smoot and Hawley lost their seats in Congress.The new President, in 1934, signed the Reciprocal Trade Agreements Act:

• it reduced the tariff levels
• promoted trade liberalization
• encouraged cooperation with foreign governments

President Franklin D. Roosvelt

Thank you!