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Edward S. Kaplan, _American Trade Policy, 1923-1995_.  Westport, CT:   
Greenwood Press, 1996. x + 176 pp. Bibliography and index.  $55.00  
(cloth), ISBN: 0-313-29480-1 
 
and  
 
Edward S. Kaplan and Thomas W. Ryley, _Prelude to Trade Wars:  American 
Tariff Policy, 1890-1922_.  Westport, CT: Greenwood Press, 1994.  160 pp. 
Bibliography and index.  $49.95 (cloth), ISBN 0-313-29061-x. 
 
 
Reviewed for EH.Net by Susan Aaronson, Department of History, University 
of North Texas and The Brookings Institution <[log in to unmask]> 
 
        Trade is where foreign and domestic policies meet.  Consequently, 
the development of trade policy is fraught with controversy--between 
nations; between the affected interests and policymakers; between Congress 
and the Executive Branch; and between government agencies that negotiate 
and administer trade protection and agreements.  Edward S. Kaplan's new 
book, _American Trade Policy, 1923-1995_ promises to address some of that 
complexity.  Kaplan is to be commended for attempting to tackle the  
morass of U.S. trade policy.  Regrettably, his book falls short.   
 
        Kaplan relies on a few secondary sources, not primary sources, and 
thus, he provides an incomplete understanding of the politics and 
economics of trade policymaking.  For example, rather than examine the 
Congressional Record or Congressional hearings, he relies on _The New York 
Times_ (and no other papers) to describe the development of trade policy 
legislation.  He consistently cites the same four secondary sources for 
his analysis of trade policy and ignores prominent analysts of trade such 
as E. E. Schattsneider (_Politics, Pressures and the Tariff_,New York, 
1935) and John Jackson (_The World Trading System: Law and Policy of 
International Economic Relations_, Cambridge, MA, 1989).  He does not 
review government reports for statistics or history (such as the Annual 
Report of the U.S. Tariff Commission on the Trade Agreements Program), 
speeches of the Presidents, or speeches or reports from the U.S. Trade 
Representative.  
 
        U.S. trade policy has always reflected freer trade and 
protectionist sentiment.  Even during the supposed "glory days" of U.S. 
leadership of free trade, the U.S. protected some sectors.  Kaplan seems 
to miss this crucial point because he oversimplifies the process by which 
trade policy is made.  The nature of such protection as well as its 
endurance depends on the state of the economy, politics, and culture.   
 
        In contrast with many other nations, authority for U.S. trade 
policy is divided.  The President has power to control foreign policy, but 
under the constitution, Congress has the power to regulate international 
commerce and to tax.  Some special interests benefit from open markets and 
others benefit from protection.  As a result, America has always had a 
bifurcated trade policy, with efforts to liberalize trade coexisting with 
protection.  Finally, given the many interests concerned about trade, some 
protection is necessary to "buy" political support for freer trade 
measures.  This has been true since 1789. Why is such protection 
necessary?  Because trade can create both winners and losers.  Those who 
are hurt may deserve temporary protection, despite the costs to consumers 
and taxpayers.  Such protection is accepted by GATT law and considered 
appropriate.  
 
        Kaplan believes that the Clinton Administration is protectionist 
and negating U.S. leadership of global efforts to free trade.  In his 
view, "U.S. trade policy in 1995 has come full circle since the 
protectionist 1920s."  This thesis is flawed because Kaplan does not 
understand modern modes of protection.  Is the Clinton Administration 
really more protectionist or is it harder to reduce the types of 
protection nations rely on today?  
 
        In the first five decades of the twentieth century, nations relied 
on border measures (tariffs, exchange controls, quotas etc..) to protect.  
These border measures are overt and were easily reduced in the first eight 
GATT rounds.  As a result, today tariffs in most GATT members are 
relatively low.  Ironically, GATT's very success may have encouraged 
nations to rely on "covert" trade barriers (domestic measures) such as 
subsidies, government procurement policies or regulation in recent years.  
Because these administrative measures are domestic policies, it is hard to 
determine whether nations use such regulations with the intent to 
discriminate against foreign producers.  Under 301 trade legislation, when 
the President confronts such trade barriers, he is required to investigate 
and sometimes to punish protectionist nations with retaliatory protection 
in the United States.  Kaplan fears that America (because of Super 301) 
appears less disposed towards multilateralism and is "moving from a 
multilateral trade approach within the WTO to a unilateral one under which 
it threatens countries like Japan with tariff increases for failing to 
open their markets" (p. x). Had Kaplan read primary sources or Susan 
Schwab's _Trade-offs_ (Cambridge, MA, 1994) he would understand that the 
Clinton Administration is reluctant to use these powers, nor did it call 
for them.  
 
        A more careful review of the history of Uruguay Round negotiations 
and enabling legislation shows that both the Bush and Clinton 
Administrations have tried hard to broaden the rules that govern trade to 
include corruption and labor standards, and to complete negotiations to 
bring new sectors into the GATT/WTO system such as services and 
agriculture.  This is not a protectionist record.  Ironically, Jesse 
Helms, Pat Buchanan, and other noted protectionists frequently complain 
that the United States under Clinton is too supportive of multilateralism.  
The author ignores the Clinton Administration's push to expand the North 
American free trade agreement (NAFTA); its continued leadership of global 
efforts to free trade; its unwillingness to cite many nations (from 
Argentina to India) under super 301; and its attempts to bring non-WTO 
members into membership (such as Saudi Arabia, China, Ukraine, and 
Russia).  Finally, instead of relying on domestic tools to protect, the 
Clinton Administration seems to be relying on international tools.  The 
U.S. is using the dispute settlement mechanism of the WTO.  From January, 
1995 to July, 1996, the U.S. has invoked dispute settlement in 16 cases, 
more than any other country in the world.  
 
        Writing a history of tariffs is a daunting task.  It is hard to 
make it interesting.  Dr. Kaplan has also teamed up with Thomas W. Ryley 
in an earlier book on the history of tariff policy, _Prelude to Trade 
Wars_, which does a good job at describing the politics of trade policy 
without being dry.  The book is especially good at explaining the 
background of the participants and how they came to their positions.  
Unfortunately, the authors rely principally on secondary sources to make 
their case.  Consequently, they are making their arguments based on the 
strong (or weak shoulders) of others rather than their own extensive 
research.  
 
        For example, describing the Emergency Tariff Act of 1921, the 
authors write "to all appearances in 1914, the country desired a moderate 
tariff bill."  To prove their point they cite one article in the American 
Economic Review, written in 1923.  That would not convince most historians 
that is what the country desired.  
 
        The analysis is hampered by sloppy writing and inadequate 
argumentation.  For example, "The McKinley Tariff ... was the first of a 
number of tariff bills that raised duties to their highest levels in U.S. 
history."  Which one was the highest?  All of them?  Moreover, the title 
is a shocker.  Which trade wars are the authors talking about?  In the 
20th century, when did the U.S. go to war over trade?  The very term 
"trade wars" gives one the sense that trade is a zero sum game, a 
competition.  A more plausible assumption is that entities trade because 
they think they can both gain.  
 
        The authors' contribution is strongest in political history.  
(Ironically, the authors write for a series called Contributions in 
Economics and Economic History.) For those interested in the politics of 
American tariff making in this period, they provide a decent read.  But to 
understand U.S. trade policy, one must understand the social, 
technological and economic environment, as well as the political 
environment..  
 
        Those readers who want to gain a better understanding of the 
complexities of the history of U.S. trade policy should look beyond these 
two books.  Good books with very different perspectives include Thomas 
Zeiler's _American Trade and Power in the 1960s_ (New York, 1992); Alfred 
Eckes's _Opening America's Market: U.S. Foreign Trade Policy since 1776_ 
(Chapel Hill, NC, 1995);  I.M. Destler's _American Trade Policies: System 
Under Stress_ (Washington, DC, 1995); G. John Ikenberry et al, _The State 
and American Foreign Economic Policy_ (Ithaca, NY, 1984); William Becker 
and Samuel F. Wells, eds., _Economics and World Power: An Assessment of 
American Diplomacy since 1789_ (New York, 1984); Susan Aaronson, _Trade 
and the American Dream_ (Lexington, KY, 1996); and John Dobson, _Two 
Centuries of Tariffs_ (Washington, 1976).  
 
 
Susan Ariel Aaronson  
Department of History 
University of North Texas  
and 
Guest Scholar in Economics 
The Brookings Institution 
 
Susan Aaronson is also a regular commentator on Public Radio International's  
_Marketplace_. 
 
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