History of the Payne-Aldrich Tariff Act

History of the Payne-Aldrich Tariff Act
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  • 0:01 Payne-Aldrich Tariff Act
  • 0:42 Payne Proposal
  • 1:44 Aldrich Proposal
  • 2:19 Political Effects
  • 3:02 Lesson Summary
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Lesson Transcript
Instructor: Jessica Whittemore

Jessica has taught junior high history and college seminar courses. She has a master's degree in education.

This lesson will explain the economic aspects of the Payne-Aldrich Tariff Act. It will also discuss its impact on the Republican Party and the presidency of William Taft.

Payne-Aldrich Tariff Act

If you turn on any national news program, it usually only takes about two minutes to hear political parties fighting. However, seeing one political party tear itself apart really makes headlines. Today, we'll look at one such instance as we discuss the Payne-Aldrich Tariff Act of the early 1900s.

For starters, the Payne-Aldrich Tariff Act is usually summed up as a compromise over tariff rates. Keeping things simple, a tariff is a tax paid on imports or exports. Although this act centered on economics, it's most famous for what it did to William Taft and the Republican Party.

Payne Proposal

For some background, the Payne-Aldrich Tariff Act became law under the presidency of William Taft. Supported by Taft, it began as the Payne Proposal. Named after the representative who recommended it, the proposal sought to lower tariffs on goods coming into the United States. Taft, and the more progressive Republicans who sought to limit the power of big business, believed tariffs only served to hurt the public. After all, higher tariffs meant higher prices.

On the other hand, conservative Republicans supported big business and therefore, liked high tariffs. The more other countries had to pay to get their goods to American consumers, the better!

Being stuck between a rock and a hard place, President Taft succeeded in passing the Payne Proposal in the year 1909. Unfortunately for him, he also succeeded in really ticking off the conservative branch of his own party! Unfortunately for the whole Republican Party, the fight was far from over!

Aldrich Proposal

In the same year, the conservative Republicans offered the Aldrich Proposal. It tried to supplant the Payne Proposal and actually called for some higher tariffs!

Giving in to some serious political pressure, Taft accepted several of the tenets of the Aldrich proposal, and the two were combined to create the Payne-Aldrich Tariff Act. As a very, very watered down version of both original acts, it lowered some taxes, while also raising others. To pacify the more progressive Republicans, it also included a corporate tax.

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