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Reciprocal Tariff Act: Difference between revisions
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=== Differences between RTAA and other trade agreements === | === Differences between RTAA and other trade agreements === | ||
Before the RTAA, if Congress wanted to establish a lower tariff for particular [[imports]], it would act unilaterally and tackle the foreign country's tariff rate as fixed. Congress would choose a tariff rate that was either a little higher or lower than the median preferred tariff, depending upon the composition of the Congress. Generally, a [[Republican Party (United States)|Republican]]-controlled Congress would prefer higher tariffs, and a | Before the RTAA, if Congress wanted to establish a lower tariff for particular [[imports]], it would act unilaterally and tackle the foreign country's tariff rate as fixed. Congress would choose a tariff rate that was either a little higher or lower than the median preferred tariff, depending upon the composition of the Congress. Generally, a [[Republican Party (United States)|Republican]]-controlled Congress would prefer higher tariffs, and a Democratic-controlled Congress would prefer lower tariffs. Thus, tariffs were chosen based on US [[domestic politics]]. Individual members of Congress were under great pressure from industry [[lobbyists]] to raise tariffs to protect it from the negative effects of foreign imports.<ref name="Bailey"/> | ||
The RTAA's novel approach freed Roosevelt and Congress to break that trend of tariff increases. It tied US tariff reductions to reciprocal tariff reductions with international partners. It also allowed Congress to approve the tariffs with a [[Majority|simple majority]], as opposed to the [[two-thirds majority]] necessary for other treaties. Also, the President had the authority to negotiate the terms. The three innovations in trade policy created the political will and feasibility to enact a more liberal trade policy.<ref name="Bailey"/> | The RTAA's novel approach freed Roosevelt and Congress to break that trend of tariff increases. It tied US tariff reductions to reciprocal tariff reductions with international partners. It also allowed Congress to approve the tariffs with a [[Majority|simple majority]], as opposed to the [[two-thirds majority]] necessary for other treaties. Also, the President had the authority to negotiate the terms. The three innovations in trade policy created the political will and feasibility to enact a more liberal trade policy.<ref name="Bailey"/> | ||
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Led by the United States and the United Kingdom, international co-operation flourished, and concrete institutions were created. In talks begun at the [[Bretton Woods Conference]] of 1944, the [[International Monetary Fund]] was created. By 1949, the first international board governing trade, the [[General Agreement on Tariffs and Trade]] (GATT), had been established. In 1994, the GATT was replaced by the [[World Trade Organization]] (WTO), which still oversees international trade agreements.<ref name="Oatley">{{cite book|last=Oatley|first=Thomas|title=International Political Economy|year=2010|pages=71–113}}</ref><ref>{{cite journal|last=Ruggie|first=John Gerard|title=International regimes, transactions, and change: embedded liberalism in the postwar economic order|journal=International Organization|date=Spring 1982|volume=36|issue=2|series=2|pages=379–415|doi=10.1017/s0020818300018993|doi-access=free}}</ref> | Led by the United States and the United Kingdom, international co-operation flourished, and concrete institutions were created. In talks begun at the [[Bretton Woods Conference]] of 1944, the [[International Monetary Fund]] was created. By 1949, the first international board governing trade, the [[General Agreement on Tariffs and Trade]] (GATT), had been established. In 1994, the GATT was replaced by the [[World Trade Organization]] (WTO), which still oversees international trade agreements.<ref name="Oatley">{{cite book|last=Oatley|first=Thomas|title=International Political Economy|year=2010|pages=71–113}}</ref><ref>{{cite journal|last=Ruggie|first=John Gerard|title=International regimes, transactions, and change: embedded liberalism in the postwar economic order|journal=International Organization|date=Spring 1982|volume=36|issue=2|series=2|pages=379–415|doi=10.1017/s0020818300018993|doi-access=free}}</ref> | ||
The [[US Department of State]] also found good use of the expansion of free trade after World War II. Many in the State Department saw multilateral trade agreements as a way to engage the world in accordance with the [[Marshall Plan]] and the [[Monroe Doctrine]]. US trade policy became an integral part of [[US foreign policy]]. That pursuit of free trade as [[diplomacy]] intensified during the [[Cold War]], as the US competed with the | The [[US Department of State]] also found good use of the expansion of free trade after World War II. Many in the State Department saw multilateral trade agreements as a way to engage the world in accordance with the [[Marshall Plan]] and the [[Monroe Doctrine]]. US trade policy became an integral part of [[US foreign policy]]. That pursuit of free trade as [[diplomacy]] intensified during the [[Cold War]], as the US competed with the Soviet Union for relationships around the globe.<ref name="Oatley"/> | ||
== Notes == | == Notes == | ||