Fordney-Mccumber: Catalyst Or By-Product?

ABSTRACT

This qualitative research paper seeks to determine whether the Fordney-McCumber Tariff Act of 1922 was the product of the ideas currently known as American Exceptionalism, or if the Act was simply another by-product of a temporary wave of post-war nationalism. Additionally, this paper investigates whether the Act was or was not a catalyst for public adoption of a belief in American Exceptionalism. This paper analyzes both a comprehensive contemporary source, written at the time of the act, as well as a modern history of the act and its effects, to determine any and all affect that the Tariff may have had on America’s self-perception.

INTRODUCTION

A 2011 Fox News poll recorded that 84% of Americans believe that the United States is “The greatest nation in the world.” This notion has been known alternatively as both nationalism and, more recently, as American Exceptionalism. While the term is relatively new, there have been numerous laws written and passed that reflect or reinforce this belief; one of the most prominent of these laws was the Tariff Act of 1922, also known as the Fordney-McCumber Act. The Act, which was one of the major pieces of post-war legislation, required tariffs on imported goods to be based on American prices rather than foreign ones (Berglund, 1923). Given the nationalist spirit of the American public at the time, stemming from a decisive military victory in the Great War, and the surging post-war economy while much of the world’s economy was depressed, was this law a statement that perpetuated American Exceptionalism to that public? Or was it simply a by-product of that nationalist fervor? This qualitative historical research paper intends to determine whether Fordney-McCumber was an assertion of American Exceptionalism or simply a result of the ideas that coalesced into that belief later on.

LITERATURE REVIEW

Despite the term "American exceptionalism" being frequently used in the media, it has no single definition; instead, it is a term with several varying meanings, with only a small common thread holding them together. While modern interpretations vary widely, from an idea used as an "excuse for imperialism or extreme nationalism" to "God's distinct blessing on the United States since the nation's beginning", in her essay "American Exceptionalism and Its Impact on Presidents Foreign Policy", Leah Achor (2012) covers the range of interpretations, extracting a common theme that defines American Exceptionalism as "the belief that the United States is qualitatively different from all other nations" (p. 1). Despite the term's mostly positive, nationalistic connotations when seen today in the media, the actual term originates from a 1929 remark by Joseph Stalin. "Exceptionalism" was originally intended to be pejorative in nature, the initial remark about a theory describing America as innately different than other nations, making it less likely to adopt socialism (Achor, 2012, p. 4; McCoy, 2012). The term was adopted further during the 1930s by members of the Communist Party during debates of the legitimacy of this theory (Foner, 2013). This sentiment was reflected in an April 1930 statement by the American Communist Party, which said "The storm of the economic crisis in the United States blew down the house of cards of American exceptionalism" (McCoy, 2012).

As indicated by McCoy (2012), usage of this term faded (along with the communist movement in the United States) as World War II began and nationalism began its steady upward trend. Despite the political swings of the 1960s and 1970s, this term did not become a widely-used part of American lexicon until the 1980s, when usage of the term skyrocketed, "charged with a new connotation of national superiority" thanks to a New York Times article by Richard J. Tofel (McCoy, 2012). The term more recently saw dramatically increased usage during the most recent presidential election, including the first time it had been used in a presidential debate (McCoy, 2012). Dr. Jerome Karabel, professor of sociology at the University of California, Berkeley, charted the dramatic increase of the term's usage through November 2011. That chart is reproduced here.

(Chart omitted for preview. Available via download)

Most writers with more than a passing interest in the subject of American exceptionalism attribute the basis of the idea of American exceptionalism to Alexis de Tocqueville, a French historian. His work Democracy in America, originally published in 1835, gives an outsider's perspective of the United States, gained during a nine-month visit to the United States. The work is noted not only for its thorough analysis of the United States during the time it was written but for labeling the "position of Americans as exceptional" (Tripathi, 2013). Wilson's summary of the work states that Tocqueville gave 3 reasons for this position: the location (the US was founded on a newly-discovered, isolated continent), the system of government (one that "involves federalism and an independent judiciary"), and a certain character of citizens ("habits of the heart", largely shaped by religious traditions of the time). As an aside, it seems interesting that two things so deeply embedded in modern Americana, the Statue of Liberty and the notion that the United States is "the greatest nation in the world", originated in France.

For much of its early history, the United States had a policy of non-interventionism, that is, not interfering in the politics of other nations. The importance of this policy cannot be overstated for its explanatory power with regards to early American behavior. George Washington (1796), the first president, began his farewell address with the following:

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. Europe has a set of primary interests, which to us have none, or a very remote relation. Hence she must be engaged in frequent controversies, the causes of which are essentially foreign to our concerns. Hence therefore it must be unwise in us to implicate ourselves, by artificial ties, in the ordinary vicissitudes of her politics, or the ordinary combinations and collisions of her friendships, or enmities: Our detached and distant situation invites and enables us to pursue a different course...

This policy continued, uninterrupted, and, for the most part, unquestioned, through the 19th and into the 20th century. This policy was so ingrained in the fabric of the United States that Woodrow Wilson won his re-election in 1916 with the campaign slogan "he kept us out of war" (“Woodrow” 2006). Early in the war (WWI began in 1914), Great Britain adopted a policy of blocking American cargo from Germany and would illegally search and seize cargo from American ships found near Germany. Wilson, frustrated, protested this but did not take action against the British, instead continued free trade with them (as exports to Germany dropped dramatically). In response, Germany, with their new weapon, the U-boat (submarine), declared that they would sink enemy merchant ships found around Great Britain. Wilson followed up on this by declaring that Germany would be held accountable if they injured any Americans. In May 1915, Germany sank the Lusitania, killing nearly 1200 people (over 100 of whom were Americans). While the sinking was justified by Germany's earlier declaration, as the ship was carrying large amounts of ammunition, this did little to calm the public, with many asking for war. Germany continued sinking unarmed ships and after the sinking of a few more vessels, Wilson issued the Sussex Ultimatum, decreeing that the U.S. would break diplomatic relations with Germany if they continued to sink unarmed ships. On January 31, 1917, Germany declared that it would wage unrestricted warfare against all shipping vessels around Great Britain. This caused Wilson to break diplomatic relations with Germany, as threatened earlier. Following this, Germany sank several more unarmed American vessels and the infamous Zimmerman Telegram was published, causing pro-war sentiment to reach a new high in the United States with many Americans outraged at the prospect of Mexico taking back some land.

On April 2, 1917, driven by these acts, Wilson reversed his previous stance, asking Congress to declare war on Germany. A little over a year later, the United States emerged from World War I, victorious and mostly untouched. The War decimated much of Europe's infrastructure, hence the nickname "The Great War", which led the United States to export a large quantity of money, food, and goods. This led to a change in status for the United States from a net debtor to a net creditor, a position the United States held until 1985 (AP, 1987). By 1921, Europe had rebuilt much of its basic infrastructure, sharply lowering its demand for imported manufactured goods, crude materials, and food, causing US exports to fall dramatically. The following table was published by the US Bureau of the Census in 1972, detailing the values, in millions, of U.S. exports, sorted by category.

(Table omitted for preview. Available via download)

As indicated in the table, between 1919 and 1921, total US exports nearly halved. Republicans were known at the time for being strongly protectionist of American industry, a stance adopted since the reunification of the party after 1909, when President Taft inadvertently caused the Republicans to split. Taft supported keeping tariffs reasonable, making the following statement in his address on The Tariff Act of 1909: "All that it is intended to do, and that is what I wish to repeat, is to put the tariff where it will protect industries here from foreign competition." The Tariff Act of 1909 (the Payne-Aldrich Tariff), however, ended up as too much of a compromise bill, angering both those who wanted to lower tariffs and those who wanted to raise them, causing enough trouble to actually split the Republican Party, giving control to Democrats for the next several years. Democrats were nearly unified in their stance, one of lowering tariffs across the board, as the table on the previous page indicates, until after the passage of Fordney-McCumber, after which southern Democrats, who represented farm-heavy areas, became increasingly acclimated to the idea of protective tariffs (Dollar, 1973, p. 46).

The Tariff Act of 1922 (commonly referred to as the Fordney-McCumber Tariff) was the centerpiece of legislation delivered by the heavily Republican dominated 67th United States Congress (Berglund, 1923, p. 14). The bill's name comes from its sponsors, Joseph Fordney (then chair of the House Ways and Means Committee) and Porter McCumber (then chair of the Senate Finance Committee). The 67th Congress was the first since early 1913 with Republican control of the House of Representatives, Senate, and the Presidency. Seizing this opportunity, Republicans quickly passed an (intended to be temporary) Emergency Tariff, reversing the lowered tariffs passed by Democrats in the few years before. Republicans worked for nearly 20 months, beginning before President Harding took office, creating Fordney-McCumber, a more permanent bill, continuing the sharp upward trend in both "intense nationalism" and tariff rates since the end of the Civil War (Berglund, 1923, p. 14-15, 33). In addition to nearly across-the-board raises on tariff rates, the vote was almost completely split along party lines, with only 18 members of Congress (from both houses combined) going against their respective parties. Fordney-McCumber established a Tariff Commission primarily to recommend changes in tariff rates (Berglund p. 30-32). The bill also allowed tariffs to be based off of American, rather than foreign, prices. The rate changes were dramatic, in some instances. The following chart is an abridged version of a chart detailing some of the major rate changes between the major tariff acts of 1909, 1913, and 1922, respectively, by Kaplan (2013).

(Chart omitted for preview. Available via download)

METHODOLOGY

In order to determine whether or not the Fordney-McCumber Tariff was a catalyst for American exceptionalism thought, one has to look at it in two lights. First, one must examine contemporary source material to determine what was being said about the Act; second, one must examine a modern history of it to see what attitudes about America’s unique place in the world resulted from the Act. To this end, two major works, one from each category, has been found, identified, and examined critically to determine Fordney-McCumber’s true place in the American Exceptionalism discussion.

The most complete and readily available commentary on the Act as it was being debated was Tariff Primer by Lee F. Lybarger. It was written in 1922, when the tariff was simply known as the Fordney bill. The author’s stated objective was to describe what the tariff entailed, how it was supposed to work, and then to identify who or what was meant to benefit from it. His work is profoundly opinionated, but contains the facts surrounding the bill and the logic behind it, making it valuable for this discussion.

The most comprehensive modern source on the effects of Fordney-McCumber is Kaplan’s The Fordney-McCumber Tariff of 1922, written for the Economic History Association. In it, he describes the background, deliberation, and most importantly, the short- and long-term effects of the tariff. It adequately recounts the effects it had on the American psyche and the country’s belief in its uniqueness. This reflective piece provides valuable information regarding the acceptance of the tariff and how, over the ten years following its inception, people’s attitude towards American nationalism was or was not altered. By examining these two sources, a determination can be made regarding the tariff’s role in mainstreaming American exceptionalism.

RESULTS

Lybarger’s (1922) explanation of the Fordney-McCumber tariff revealed that instead of being seen as a powerful force for American nationalism, the Tariff Act of 1922 was seen by contemporaries as the exact opposite, and detrimental to the American spirit as a whole. Lybarger (1922) wrote, “The heroic and independent spirits of our ‘Sires of ’76’ would not have considered the toleration of so monstrous and extortionate a measure as the Fordney-McCumber Tariff for a single minute” (p. i). He appeals directly here to the memory of our nation’s founders—a common tactic, by the way, among current proponents of American Exceptionalism—and asserts that Fordney-McCumber was an insult to their memory and sacrifice.

It is not only in the memory of revolution that one finds American Exceptionalism. It is also in the values that the nation professes to hold. One that has always been close to the core of Exceptionalist thinking is that the United States was founded on principles of liberty, individualism, and popular sovereignty, and that as it has grown, it is the torch-bearer for human rights and dignity (Achor, 2012, pp 26-28). Lybarger (1922) makes the point that during the war, the industries seeking protection under Fordney-McCumber had made astronomical profits since embargoes were in place against certain foreign competitors, and that this, not the belief that American labor was something unique and worth protecting, was the driving force behind the Act. He wrote that given the blatant markups in price that were bound to come in the name of protectionism, “There is but little hope for the future of a people who would tolerate such an outrage on human rights” (p. 21). Given how dearly the United States has held the concept of human rights, it appears that contemporary thinkers believed that Fordney-McCumber was in violation of a core American value.

His final appeal, having laid out his case, rests with the unique character of an American citizen and his or her values as such. Lybarger calls on both the fortitude and love of liberty that are assumed as part of the “American spirit”—two of the traits modern Exceptionalist politicians hold up as innately American. He wrote, “Your reaction…depends wholly upon the extent to which you are a real, red-blooded, 100% American…Now, just what is your response? Is it the response of a freeman, of a real American…or is it the response of a cowering, abject serf and slave?” (p. 31). The appeal to a freer, higher nature than those same foreigners Fordney-McCumber targeted is what Lybarger attempted to use to bring down the bill.

Kaplan, in his 2013 history of the bill, stated that the creation of the bill stemmed from the wartime prosperity the nation had experienced and a feeling of responsibility towards protecting jobs for American citizens; the latter of these sentiments is frequently expressed by those who oppose outsourcing and globalization today. The nations of Europe recovered slowly from the war, and were looking towards the biggest consumer market in the world—the United States—as a possible means of nursing their peacetime industries back to health. In response, McCumber and his fellow Republicans wanted to tax imports heavily enough that domestic industries, which had grown powerful during hostilities, would retain their upper hand in the American market. As Europe recovered its economic strength, the new competition was beginning to hurt American industry.

Fordney, however, had a solution. A completely protected dye market had made astounding profits as a result of a wartime embargo (Lybarger, 1922, p. 21). Based on this and other presumed successes, Fordney claimed that “The new bill would protect the American farmer from cheap imports, as well as provide more jobs for American labor” (Kaplan, 2013). New tariffs on tungsten and other metals were placed with an assumption that domestic suppliers were vital parts of both the economy and the national security apparatus, and therefore worthy of protection. By discouraging foreign companies from selling ores to the United States, Fordney was attempting to guarantee a “home-grown” mining and production base in the event of another war (Kaplan, 2013).

Kaplan (2013) records that Fordney-McCumber resulted in increased tariffs all over the world as retaliation for the United States passing the bill. Instead of ensuring the prosperity that American workers “deserved”, by making trade more difficult, farmers, factory workers, and all other ranks of American labor saw their purchasing power decrease. While prices on many necessary items nearly doubled, purchasing power was halved as an indirect result of the tariff. While the upper class could afford to pay extra and still rake in prosperity, the additional hardships on the lower classes became an additional factor in the economic collapse the United States suffered at the end of the decade (Kaplan, 2013). Eventually, the supporters of the tariff abandoned it; while military isolation was desired by all parts of American society, the economic isolation foisted upon the working class by the tariff turned out to be nothing more than an additional hardship. The higher wages and secure employment promised by Fordney and McCumber never materialized (Kaplan, 2013). It was not until FDR’s first term that tariffs were lowered to jump-start the economy; it could be argued that the economic engine that America professed to command could have been kept from stalling out had tariffs not been raised so high.

Based on the contemporary source material and the historical summary, the Fordney-McCumber Tariff was not a catalyst for American Exceptionalism. Rather, the source material demonstrates fully that the Act was a political act intending to reflect both the nationalism and isolationism of the time. What has been articulated as American exceptionalism, on the other hand, was rallied in an attempt to defeat the bill. Given the frank opposition to the bill rooted in what we know now as American Exceptionalism, one must conclude that the Tariff was merely a by-product of the predominant nationalist and isolationist beliefs.

CONCLUSION

Lybarger (1922) and Kaplan (2013) both make it abundantly clear that the Fordney-McCumber Tariff was a by-product of political nationalism and isolationism. The higher fees proscribed by the bill essentially promoted economic nationalism, and resulted in economic isolation. The retaliation by other countries because of the bill resulted in more tariffs worldwide at a time when worldwide trade was still in a state of post-war fragility, inadvertently laying the foundation for the Great Depression. This turn of events did not further American values, nor did it spur feelings of America’s uniqueness. Instead, those opposing the tariff were the ones harnessing the values and traditions that coalesced into what is described today as American Exceptionalism. Therefore, one is forced to conclude that Fordney-McCumber was an embrace of American Exceptionalism on one level while the values associated with that line of thought opposed it on another. It did not serve any purpose regarding a push of those values into the mainstream. If anything, the fact that Lybarger made so many appeals to traditional Americanism is proof that the ideals behind American Exceptionalism were already considered as such.

REFERENCES

Achor, L. (2012). American Exceptionalism and Its Impacts on Presidents’ Foreign Policy. Retrieved from Academic.edu.

Associated Press. (1987, June 23). Analysts split on risks of U.S. status as debtor. The New York Times. Retrieved from http://www.nytimes.com/1987/06/23/business/analysts-split-on-risks-of-us-status-as-debtor.html

Berglund, A. (1923). The tariff act of 1922. American Economic Review, 13, 14-33.

Dollar, C. (1973). The south and the Fordney-McCumber tariff of 1922: a study in regional politics. The Journal of Southern History, 39(5), 45-66.

Fox News. (2011). America weaker but still greatest country in the world, voters say. FoxNews.com. Retrieved from http://www.foxnews.com/us/2011/05/16/fox-news-poll-america-weaker-greatest-country-world-voters-say/

Indexes of U.S. Exports and Imports by Economic Class: 1919-1971. (1972). [United States Bureau of the Census]. Retrieved from https://archive.org/details/indexesofusexpor00unit

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Karabel, J. (2011). American exceptionalism and the battle for the presidency. The Huffington Post. Retrieved from http://www.huffingtonpost.com/jerome-karabel/american-exceptionalism-obama-gingrich_b_1161800.html

Lybarger, L. (1922). Tariff Primer. Retrieved from Amazon.com.

McCoy, T. (2012). How Josef Stalin invented American exceptionalism. The Atlantic. Retrieved from http://www.theatlantic.com/politics/archive/2012/03/how-joseph-stalin-invented-american-exceptionalism/254534/

Taft, W. (1909). Address on the tariff law of 1909 (full text). Retrieved from http://millercenter.org/president/speeches/detail/3781

Tripathi, D. (2013). The illusion of American exceptionalism. Al-Jazeera. Retrieved from http://www.aljazeera.com/indepth/opinion/2013/09/201391710431753950.html

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