Between 1861 and 1933, US tariffs on foreign imports averaged 50% – among the highest in the world. Tariffs also contributed nearly half of all government revenues. Federal income taxes were only introduced, after much opposition, in 1913.

Many American politicians in the 19th century believed that US industry needed protection from its more efficient rivals. It was Alexander Hamilton, one of the authors of the US constitution and America’s first treasury secretary, who introduced tariffs in 1789. Hamilton cited the need to protect America’s “infant industries” from foreign competition.

By the end of the 19th century, US manufacturers had surpassed their British rivals. Protectionism, however, remained a cornerstone of American international economic policy. It was the expanding US domestic market and not exports to foreign countries that was driving the growth of America’s giant corporations – which were closely allied with the ruling Republican party.

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