How the U.S. has used tariffs through history — and why Trump is different, economists say

cnbc.com:

President Donald Trump imposed broad tariffs on China on Tuesday, while tariff threats hang over other major trading partners like Canada, the European Union and Mexico.

That may lead some to wonder: How have tariffs been wielded through U.S. history, and is Trump unique in his use of them?

The U.S. has used tariffs since its founding in the 18^th century.

In fact, the Tariff Act of 1789 was among the first bills ever passed by Congress.

Since then, the U.S. has used tariffs to achieve three broad goals, said Douglas Irwin, an economics professor at Dartmouth College and past president of the Economic History Association.

Irwin calls them the «three Rs» — revenue, restriction (import barriers to protect domestic industry) and reciprocity (a bargaining chip to cut deals with other countries).

Tariffs are taxes on U.S. imports, paid by the entity that's importing the foreign good. Those taxes raise revenue to help fund the federal government.

For roughly the first third of the nation's history — from its founding until the Civil War — the revenue motivation was «paramount» as a driver to impose import duties, Irwin said. The federal government relied on tariffs for about 90% or more of its revenue during that period, he said.

But things changed after the Civil War, Irwin said. The U.S. started to impose other taxes, like excise taxes, that made the nation less reliant on tariffs.

Tariffs generated about half of federal revenue from about 1860 to 1913, when the income tax was created, Irwin said.

The scale of the government expanded significantly in the 1930s — with the creation of New Deal programs like Social Security — and later for defense spending during WWII and the Cold War, said Kris James Mitchener, an economics