Eric Rauchway is an historian and a charter Friend of the Blog. One of his fields of expertise is the historical nexus between the money power and the government, particularly during the Gilded Age. So, naturally, he has been (ahem) intrigued by the former president*’s deep nostalgia for the economy of that era.
The former president* has been waxing randomly about other eras in American history on the stump throughout this election cycle. If it’s not the days on which we ran the economy by fighting over protectionism, it’s the days further back when we were locking up newspaper editors and warning France not to interfere in our politics. The problem is that the former president* doesn’t know enough about history, as the great Sean O’Faolain once put it, to throw to a cat. Professor Rauchway fills in the details.
His love of the era has become so pronounced that it’s now a fixture of his stump speech, meant to defend the massive tariffs now central to the economic platform he’s promising in a second term. There’s just one problem: Trump’s comments are historically oblivious, evincing no awareness of the depression of the 1890s, whose severity was owed, in part, to the protectionist tariffs he praises.
For as long as there had been Republicans and longer—even during the days of their predecessors, the Whigs—a high tariff had proudly occupied a place in their platforms. In the era before the Sixteenth Amendment, a tariff—a tax on imports—was a major source of federal income. But Republicans wanted tariffs not for revenue, but for protection, as they liked to say: a tariff so high it would render foreign imports undesirable to the consumer. U.S.-based manufacturers could then raise their prices to levels just shy of these tax-induced heights and still appear competitive in the marketplace. Consumers would not buy imports; tariff revenue to the U.S. Treasury would actually fall; the higher prices Americans paid would go into the pockets of American companies.
In theory, these domestic industries would plow their tariff-produced profits into research and development, improving their products and paying higher wages to workers. In practice, this trickle-down theory worked no better in the nineteenth century than it did a century later, and tariffs helped make the owners of U.S. factories into the richest of men.
(The bolded passage reiterates my long-standing feeling that the Republican Party will not excise the craziness that produced El Caudillo del Mar-a-Lago until it jettisons the voodoo economics to which Ronald Reagan strapped it, every bit as crazy an idea as ketchup as a vegetable.)
Make no mistake. The former president*’s love for the late William McKinley is real. It’s not just an infatuation he picked up because he walked past a history book one day. He was confessin’ his love for Mac to Bloomberg back in July.
So if you go back, I told you to read about William McKinley. William McKinley made this country rich. He was the most underrated president. And those that followed him took the money. Roosevelt took the money and built, you know, the whole thing with the parks and the dams. But McKinley made the money and he was truly the tariff king.
Professor Rauchway sees a historical downside to this budding bromance.
The tariff law of 1890, called the “McKinley tariff,” levied high taxes even on imports in industries, like iron and steel, in which the United States was already highly competitive. Indeed, the entire economy had been enjoying a four-year boom; there was no evident need for a spur to commerce. American enterprise had expanded rapidly into the West, drawing foreign capital—especially, but not exclusively, from British banks—into U.S. securities.
Then came the McKinley tariff. Going into effect in October 1890, it raised the average tariff nearly to 49 percent. It did its job of reducing imports and also reducing income to the Treasury, even as the Sherman Silver Purchase Act increased the Treasury’s payouts. The surplus compiled under Cleveland turned swiftly into a deficit under his successor, Benjamin Harrison.
Welcome to the Trump Economy.
Beyond that, the U.S. government was in the position of buying silver with currency backed by gold, thus steadily reducing the amount of gold it held and increasingly undermining investors’ confidence in the dollar. Anticipating a crisis, British investors began liquidating U.S. securities. Gold left U.S. coffers. By the start of 1893, U.S. gold reserves fell below $100 million, triggering a general panic of stock-selling and bank withdrawals. Bank runs and failures ensued, followed by commercial and agricultural failures. Double-digit unemployment persisted for years. If we had reliable data on the 1890s, we would understand that depression to have been as severe as the one that followed the Wall Street crash of 1929.
Tariffs are useful tools in certain economic circumstances. But running a modern national economy on them is complete madness. Nevertheless, the other night, the former president* tossed out the notion of doing away with the federal income tax. Instantly, the libertarian Right fell into spasms of ecstasy, and the 16th Amendment was trending ominously on the Xwitter. Of course, given the political era under discussion, we do well to call upon the contemporaneous wisdom of Mr. Dooley, the sage of the Archey Road, who had some thoughts on tariffs to share across the mahogany.
“Me congressman sint me a copy iv th’ tariff bill th’ other day. He’s a fine fellow, that congressman iv mine. He looks afther me inthrests well. He knows what a gr-reat reader I am. I don’t care what I read. So he sint me a copy iv th’ tariff bill an’ I’ve been studyin’ it f’r a week. ‘Tis a good piece iv summer lithrachoor. ‘Tis full iv action an’ romance. I haven’t read annythink to akel it since I used to get th’ Dead-wood Dick series. I’m in favor iv havin’ it read on th’ Foorth iv July instead iv th’ declaration iv indypindance. It gives ye some idee iv th’ kind iv gloryous governmint we’re livin’ undher, to see our fair Columbia puttin’ her brave young arms out an’ defindin’ th’ products iv our soil fr’m steel rails to porous plasthers, hooks an’ eyes, artyficial horse hair an’ bone casings, which comes undher th’ head iv clothin’ an’ I suppose is a polite name f’r pantaloons.”
Perhaps as a historical hedge against the possible ruination of the national economy, the former president* also has taken to cosplaying the presidencies of George Washington and John Adams. Just the other day, before an audience of young conservatives in Georgia, he claimed that he “stopped wars” with France.
“You have no idea what I did in the White House,” Trump told the crowd in Duluth, Georgia, at a Turning Point PAC rally. “I stopped wars with France. France, you know the France story. They were going to charge us, think of this, 25 percent . I have to protect American companies whether we like ‘em or not.” The former president then mocked the accent of French president Emmanuel Macron, whom he dubbed a “wiseguy,” and claimed he ended a potential trade dispute in a day by threatening the French leader over the phone. “We’re not a stupid country anymore, Emmanuel,” Trump claims he said. “He’s used to dealing with stupid people over there. We’ve had some beauties, the deals that we allow.”
Then, the former president*’s campaign filed a complaint with the FEC accusing the Labour Party in the United Kingdom of election thimblerigging. From Reuters:
Donald Trump‘s campaign has accused British Prime Minister Keir Starmer’s Labour Party of “blatant foreign interference” in the U.S. presidential election after some volunteers travelled to help campaign for Vice President Kamala Harris. The Republican candidate’s camp has filed a complaint with the Federal Election Commission in Washington, calling for an investigation into what it termed apparently illegal contributions from Labour to the Harris campaign.
You may recall that President Washington, his Cabinet hopelessly split between Anglophiles and Francophiles when war broke out between Great Britain and Spain, was so worn out and frustrated by European meddling in American politics, that he made it a point to warn the country about it in his farewell address.
Against the insidious wiles of foreign influence (I conjure you to believe me, fellow citizens) the jealousy of a free people ought to be constantly awake, since history and experience prove that foreign influence is one of the most baneful foes of republican government…The great rule of conduct for us in regard to foreign nations is, in extending our commercial relations, to have with them as little political connection as possible. So far as we have already formed engagements, let them be fulfilled with perfect good faith. Here let us stop.
Of course, nothing stopped. John Adams succeeded Washington, stepping into the biggest pair of shoes in American history. Adams didn’t have the General’s influence. (Neither did anyone else.) Moreover, Adams was a notorious pain in the ass to almost everyone he ever met. And, handed the Quasi-War with France along with the presidency, Adams soon found his Cabinet completely broken down, his long friendship with Thomas Jefferson fractured, and his administration seemingly sliding inexorably from Quasi-War with France toward the real thing. (Adams even took to appearing in full military uniform, which must have been hilarious.) In response to the rising tumult, Congress passed, and Adams signed, the Alien and Sedition Acts, the infamous attack on the Bill of Rights that Jefferson referred to as “the reign of witches.” Which brings us back to 2024 and the former president*. Speaking about his proposed round-up of “invading” migrants, he told an audience in Colorado.
“I will invoke the Alien Enemies Act of 18– no, of 1798. Think of that, 1798. That’s when we had real politicians that said, ‘We are not gonna play games.’ We have to go back to 1798.”
Back when they locked up political dissenters. Back when there was slavery, and women were subjugated, and when the national economy was run by…tariffs! Of course, these two bits of historical cosplay can be considered harmless. I’m more concerned about his nostalgia for Germany of the 1930s.
This article originally ran in the Last Call With Charles P. Pierce newsletter on October 26, 2024.