Underwood Tariff Act

Underwood Tariff Act. The Underwood Tariff Act was a significant piece of legislation passed by the United States Congress and signed into law by Woodrow Wilson on October 3, 1913. This act was designed to reduce tariff duties and provide revenue for the United States Government, with the goal of promoting international trade and stimulating economic growth, as advocated by Theodore Roosevelt and William Jennings Bryan. The act was named after its sponsor, Oscar Underwood, a Democratic Representative from Alabama, who worked closely with Robert La Follette and George Norris to pass the legislation.

Introduction

The Underwood Tariff Act was a response to the Payne-Aldrich Tariff Act of 1909, which had raised tariffs and led to widespread criticism from Democratic leaders, including Woodrow Wilson and William Jennings Bryan. The act was also influenced by the Progressive Era ideals of Theodore Roosevelt and Robert La Follette, who advocated for lower tariffs and greater government regulation of business, as seen in the Federal Trade Commission and the Clayton Antitrust Act. The Underwood Tariff Act was designed to reduce tariffs on imported goods, such as those from Canada and Mexico, and to provide revenue for the United States Government through other means, such as the income tax established by the 16th Amendment to the United States Constitution. This effort was supported by Samuel Gompers and the American Federation of Labor, as well as Louis Brandeis and other prominent Progressive Era figures.

History

The Underwood Tariff Act was passed by the United States House of Representatives on May 8, 1913, and by the United States Senate on September 9, 1913. The act was signed into law by Woodrow Wilson on October 3, 1913, at the White House, with Oscar Underwood and other Democratic leaders in attendance, including Josephus Daniels and William Gibbs McAdoo. The act was a major achievement for the Democratic Party, which had campaigned on a platform of lower tariffs and greater government regulation of business, as seen in the Federal Reserve System and the Federal Trade Commission. The act was also influenced by the Bull Moose Party and its leader, Theodore Roosevelt, who had advocated for lower tariffs and greater government regulation of business, as seen in the New Nationalism movement.

Provisions

The Underwood Tariff Act reduced tariffs on imported goods, such as wool, silk, and cotton, and eliminated tariffs on many other goods, including books, art, and scientific instruments. The act also established a tariff commission to study and recommend tariff rates, and provided for the creation of a Federal Trade Commission to regulate business and prevent monopolies, as advocated by Louis Brandeis and Samuel Gompers. The act also included provisions for the income tax, which was established by the 16th Amendment to the United States Constitution, and provided for the creation of a Board of Tax Appeals to hear appeals from taxpayers, as seen in the Internal Revenue Code. The act was influenced by the Revenue Act of 1913 and the Federal Reserve Act, which were also passed during the Woodrow Wilson administration, with the support of Carter Glass and Robert Owen.

Economic Impact

The Underwood Tariff Act had a significant impact on the United States economy, leading to increased international trade and economic growth, as seen in the Roaring Twenties. The act reduced the average tariff rate from 40% to 26%, and eliminated tariffs on many goods, including books, art, and scientific instruments. The act also led to increased competition and lower prices for consumers, as seen in the retail industry, with companies like Sears, Roebuck and Co. and Montgomery Ward. The act was influenced by the Federal Reserve System and the Federal Trade Commission, which were established during the Woodrow Wilson administration, with the support of Benjamin Strong and Louis Brandeis. The act also had an impact on the global economy, leading to increased trade and economic growth in countries such as Canada, Mexico, and Europe, as seen in the Treaty of Versailles and the League of Nations.

Legacy

The Underwood Tariff Act was a significant piece of legislation that had a lasting impact on the United States economy and international trade, as seen in the General Agreement on Tariffs and Trade and the World Trade Organization. The act was influenced by the Progressive Era ideals of Theodore Roosevelt and Robert La Follette, and was a major achievement for the Democratic Party, which had campaigned on a platform of lower tariffs and greater government regulation of business, as seen in the New Deal and the Great Society. The act also led to the establishment of the Federal Trade Commission and the tariff commission, which continue to play important roles in regulating business and international trade, as seen in the North American Free Trade Agreement and the United States-Mexico-Canada Agreement. The act was also influenced by the Bretton Woods system and the International Monetary Fund, which were established after World War II, with the support of Harry S. Truman and John Maynard Keynes. Category:United States federal legislation