The Morrill Tariff of 1861 was a protective tariff bill passed by the U.S. Congress in early 1861. The act is informally named after its sponsor, Rep. Justin Morrill of Vermont, who designed the bill around recommendations by Pennsylvania economist Henry C. Carey. It was signed into law by Democratic president, James Buchanan of Pennsylvania, where support for higher tariffs to protect the iron industry was strong. It replaced the Tariff of 1857. Some historians such as Beard and Beard (1928) argued there was a divergence in economic interests between an industrializing Northeast and a plantation South before the American Civil War. But Beard did not identify the tariff as a major issue that divided North and South. Two additional tariffs sponsored by Rep. Morrill, each one higher, were passed during Lincoln's administration to raise urgently needed revenue for war.
The high rates of the Morrill tariff inaugurated a period of relatively continuous trade protection in the United States that lasted until the Underwood Tariff of 1913. The schedule of the Morrill Tariff and its two successor bills were retained long after the end of the Civil War.
- 1 Background
- 2 Impact
- 3 Morrill's historic vision
- 4 Relation to the secession controversy
- 5 References
- 6 External links
Frank Taussig, whose work "The Tariff History of the United States" is recognized as the foremost authority on the subject wrote: "In 1857 duties were still further reduced, the rate on most protected commodities going down to 24 per cent, and remaining at this comparatively low level until the outbreak of the Civil War." Taussig goes on to say:
In 1857 duties were still further reduced, the rate on most protected commodities going down to 24 per cent., and remaining at this comparatively low level until the outbreak of the Civil War. … It is true that the first steps towards a policy of higher protection were taken just before the war began. In the session of 1860-61, immediately preceding the outbreak of the conflict, the Morrill Tariff Act was passed by the Republican party, then in control because the defection of Southern members of Congress had already begun. It substituted specific duties for the ad valorem duties of 1846 and 1857, and made some other changes of significance, as in the higher duties upon iron and steel. Nevertheless, the advances then made were of little importance as compared with the far-reaching increases of duty during the Civil War.
Taussig also concludes: "It is clear that the Morrill tariff was carried in the House before any serious expectation of war was entertained; and it was accepted by the Senate in the session of 1861 without material change. It therefore forms no part of the financial legislation of the war, which gave rise in time to a series of measures that entirely superseded the Morrill tariff."
The Morrill Tariff was a major issue of contention in the 36th Congress' election for Speaker of the House. The act passed the United States House of Representatives by a strictly sectional vote during the first session of the 36th Congress on May 10, 1860. Virtually all of the northern representatives supported it and southern representatives opposed it. In that vote, only 15 northern congressmen, mostly Democrats, voted against the Morrill Tariff. Similarly, only one secessionist southern state congressman voted in favor of the tariff, along with 6 southern border state congressmen. In total, 87% of the northern congressmen supported the bill and 87.5% of southern congressmen opposed it.
When the vote was taken in Congress, Republican support for protection was nearly unanimous. A large majority of Southerners opposed the tariff increase because of their commitment to free trade and the foreign system of Adam Smith. Protective tariffs could theoretically benefit Louisiana's sugar plantation owners from Caribbean imports, but Louisiana's congressional delegation voted unanimously against the Morrill bill. The south had few manufacturing industries. The one main exception was in western Virginia (Wheeling) where iron was becoming important. (The area broke off from Virginia and joined the US as West Virginia.) Most of the southern economy depended on the export of crops like cotton and tobacco, which were in heavy demand in Europe, and for which there were few substitutes.
The bill was headed toward adoption in the Senate when Senator Robert M. T. Hunter of Virginia, a free trade advocate, employed parliamentary tactics to delay the vote until the second session after recess. This second session did not meet until after the 1860 election, so the move guaranteed that the tax issue would come up during the campaigns that fall. The Republican party needed Pennsylvania, where protectionist sentiment was strong. The heavy representation of ex-Whigs meant that most leaders favored the American School of government support for industry, banking and transportation.
During the campaign. the Republican Party endorsed higher tariffs in their 1860 platform and campaigned for Abraham Lincoln. The party stressed the tariff issue only in Pennsylvania and New Jersey. Both Democratic tickets opposed the Morrill Tariff, protectionism in general, and the American System.
Returning in December, after the election, the Senate again took up the Morrill bill and intensely debated it for the next several months. On February 14, 1861, Lincoln publicly announced that he would make a new tariff his priority if the bill did not pass by inauguration day on March 4th.
According to my political education, I am inclined to believe that the people in the various sections of the country should have their own views carried out through their representatives in Congress, and if the consideration of the Tariff bill should be postponed until the next session of the National Legislature, no subject should engage your representatives more closely than that of a tariff.
The Southern cotton states that might have been hurt by the new tariff all had left the Union to form the Confederate States of America. Therefore, they were not affected and did not have a voice in the policies of the country they had renounced. On February 28, the Senate finally voted on and adopted the Morrill Tariff. It was one of the last bills signed by outgoing Democratic president, James Buchanan.
Regarding the Morrill Tariff's political ramifications, Richard Hofstadter concluded "What is most significant with respect to the causation of the Civil War is the fact that there was no open hostility on this issue at the time between these manufacturers and the South that might have been exploited for a partisan purpose." In contrast, Michael Holt argued that the tariff issue was on the rise following the Panic of 1857, which northerners such as Henry Carey blamed on the country's free trade policy - a problem he claimed the bill would rectify with protection of industry. According to Holt "By the fall of 1858 Republicans throughout the North, but especially in Pennsylvania, New Jersey, New York, and Massachusetts, had taken up the cry for tariff revision." This political climate led to the Morrill Tariff being proposed in 1859 and debated in Congress from 1860 to 1861. Luthin also differs from Hofstadter. He argues that the delay of the Senate vote until after the 1860 election guaranteed the Morrill Tariff's position as a contentious campaign issue.
The main purpose of the Morrill Tariff's high rates was the protection of industrial manufacturing, located mostly in the northeast, from foreign competitor products. Due to the penalties it imposed on foreign traded goods the act formented hostility and condemnation of the United States from abroad, mainly in Free Trade supporting Britain..
Other provisions of the bill altered and restricted the Warehousing Act of 1846.
The immediate effect of the Morrill Tariff was to more than double the tax collected on most dutiable items entering the United States. In 1860 American tariff rates were among the lowest in the world and also at historical lows by 19th century standards, the average rate for 1857 through 1860 being around 17% overall (ad valorem), or 21% on dutiable items only. The Morrill Tariff immediately raised these averages to about 26% overall or 36% on dutiable items, and further increases by 1865 left the comparable rates at 38% and 48%. Although higher than in the immediate antebellum period, these rates were significantly lower than between 1825 and 1830, when rates had sometimes been over 50%.
The United States needed more revenue to support its troops in the field --$320 million for the next year, of which three-fourths had to come from tariff revenues. Therefore Secretary of the Treasury Salmon P. Chase, a long-time free-trader, worked with Morrill to pass a second tariff bill in summer 1861, raising rates another 10 points in order to generate more revenues. These subsequent bills were primarily revenue driven to meet the war's needs, though Luthin notes they enjoyed the support of protectionists such as Carey, who again assisted Morrill in the bill's design (p. 627). It played a modest role in the financing of the war, funding about 11% of the war effort (in terms of its tariff revenues). It was less important than other measures, such as bond sales. Customs revenue was $345 million from 1861 through 1865, or 43% of all federal tax revenue, while spending on the War and Navy departments totalled $3,065 million.
There is some evidence the new American tariff angered many British commentators and politicians; a few went to the extreme of voicing support for the new Confederate States of America over the United States of America. The expectation of high rates probably caused British shippers to hurry up their deliveries before the new rates took effect, so that there was a decline in British exports to the United States in the early summer of 1861. When complaints were heard from London, Congress counterattacked. The Senate Finance Committee chairman snapped, "What right has a foreign country to make any question about what we choose to do?" Answering allegations by the British and free trade supporters that the poor would be hurt by the new tariff, Congress defiantly raised the tariff a third time to ensure funding for the war effort. It added a temporary (expiring at the end of the war) income tax of 3% on incomes over $800; paid primarily by the wealthy, for most workers made under $500 a year. (It was the first income tax in American history.) Further Congress passed a 3% tax on domestic manufacturers for war purposes. (Richardson 115-7)
Morrill's historic vision
According to historian Heather Cox Richardson, Morrill intended to offer protection to both the usual manufacturing recipients and a broad group of agricultural interests. The purpose was to appease interests beyond the northeast, which traditionally supported protection. For the first time protection was extended to every major farm product.
Planning to distribute the benefits of a tariff to all sectors of the economy, and also hoping to broaden support for his party, Morrill rejected the traditional system of protection by proposing tariff duties on agricultural, mining, and fishing products, as well as on manufactures. Sugar, wool, flaxseed, hides, beef, pork, corn, grain, hemp, wool, and minerals would all be protected by the Morrill Tariff. The duty on sugar might well be expected to appease Southerners opposed to tariffs, and, notably, wool and flaxseed production were growing industries in the West. The new tariff bill also would protect coal, lead, copper, zinc, and other minerals, all of which the new northwestern states were beginning to produce. The Eastern fishing industry would receive a duty on dried, pickled, and salted fish. "In adjusting the details of a tariff," Morrill explained with a rhetorical flourish in his introduction of the bill, "I would treat agriculture, manufactures, mining, and commerce, as I would our whole people—as members of one family, all entitled to equal favor, and no one to be made the beast of burden to carry the packs of others."
According to Taussig, "Morrill and the other supporters of the act of 1861 declared that their intention was simply to restore the rates of 1846." However, he also gives reason to suspect that the bill's motives were intended to put high rates of protection on iron and wool to attract states in the West and in Pennsylvania:
"The important change which they (the sponsors) proposed to make from the provisions of the tariff of 1846 was to substitute specific for ad-valorem duties. Such a change from ad-valorem to specific duties is in itself by no means objectionable; but it has usually been made a pretext on the part of protectionists for a considerable increase in the actual duties paid. When protectionists make a change of this kind, they almost invariably make the specific duties higher than the ad-valorem duties for which they are supposed to be an equivalent...The Morrill tariff formed no exception to the usual course of things in this respect. The specific duties which it established were in many cases considerably above the ad-valorem duties of 1846. The most important direct changes made by the act of 1861 were in the increased duties on iron and on wool, by which it was hoped to attach to the Republican party Pennsylvania and some of the Western States"
Henry Carey, who assisted Morrill while drafting the bill and was one of its most vocal supporters, strongly emphasized its importance to the Republican Party in his January 2, 1861 letter to Lincoln. Carey told the President-Elect "the success of your administration is wholly dependent upon the passage of the Morrill bill at the present session." According to Carey:
"With it, the people will be relieved - your term will commence with a rising wave of prosperity - the Treasury will be filled and the party that elected you will be increased and strengthened. Without it, there will be much suffering among the people -- much dissatisfaction with their duties -- much borrowing on the part of the Government - & very much trouble among the Republican Party when the people shall come to vote two years hence. There is but one way to make the Party a permanent one, & that is, by the prompt repudiation to the free trade system."
Historian Reinhard H. Luthin documents the importance of the Morrill Tariff to the Republicans in the 1860 presidential election. Abraham Lincoln's record as a protectionist and support for the Morrill Tariff bill, he notes, helped him to secure support in the important electoral college states of Pennsylvania and New Jersey.
Congressman John Sherman later wrote:
The Morrill tariff bill came nearer than any other to meeting the double requirement of providing ample revenue for the support of the government and of rendering the proper protection to home industries. No national taxes, except duties on imported goods, were imposed at the time of its passage. The Civil War changed all this, reducing importations and adding tenfold to the revenue required. The government was justified in increasing existing rates of duty, and in adding to the dutiable list all articles imported, thus including articles of prime necessity and of universal use. In addition to these duties, it was compelled to add taxes on all articles of home production, on incomes not required for the supply of actual wants, and, especially, on articles of doubtful necessity, such as spirits, tobacco and beer. These taxes were absolutely required to meet expenditures for the army and navy, for the interest on the war debts and just pensions to those who were disabled by the war, and to their widows and orphans.
Relation to the secession controversy
The Morrill tariff was compared to the 1828 Tariff of Abominations by its opponents, although its overall rate was significantly lower. On November 19, 1860 Senator Robert Toombs denounced the "infamous Morrill bill" as the product of a coalition of "the robber and the incendiary...united in joint raid against the South" in his speech advocating secession to the Georgia Legislature. However, Toombs said preservation of slavery was the cause of secession. Of the four Secession Declarations, only Georgia's mentions the tariff issue. The December 25, 1860 Address of South Carolina to Slaveholding States complains about excessive taxation and heavy import duties - a reference to the then-pending Morrill Bill:
And so with the Southern States, towards the Northern States, in the vital matter of taxation. They are in a minority in Congress. Their representation in Congress, is useless to protect them against unjust taxation; and they are taxed by the people of the North for their benefit, exactly as the people of Great Britain taxed our ancestors in the British parliament for their benefit. For the last forty years, the taxes laid by the Congress of the United States have been laid with a view of subserving the interests of the North. The people of the South have been taxed by duties on imports, not for revenue, but for an object inconsistent with revenue— to promote, by prohibitions, Northern interests in the productions of their mines and manufactures.
On the other hand, cotton state representatives hoping to lure Virginia into their new nation promised a protective tariff that would enable Virginia to become an industrial state, replacing New England as the source of manufactured items. According to Luthin "Historians are not unanimous as to the relative importance which Southern fear and hatred of a high tariff had in causing the secession of the slave states." Charles Beard argued in the 1920s that very long-term economic issues were critical, with the pro-tariff industrial Northeast forming a coalition with the anti-tariff agrarian Midwest against the plantation South. Beard's model fell out of favor in the 1950s, and few historians any longer agree with it, as shown by Richard Hofstadter (Progressive Historians) Historians also emphasize that with a major war looming that the USA urgently needed much higher federal revenue, and as Taussig has shown, the tariff was the easiest way to get it. However, there has been a resurgence of interest in Beard's theory among free-traders (who want to eliminate tariffs), economists, and pro-Confederate historians. A 2002 study by economists Robert McGuire and T. Norman Van Cott concluded:
A de facto constitutional mandate that tariffs lie on the lower end of the Laffer relationship means that the Confederacy went beyond simply observing that a given tax revenue is obtainable with a "high" and "low" tax rate, a la Alexander Hamilton and others. Indeed, the constitutional action suggests that the tariff issue may in fact have been even more important in the North-South tensions that led to the Civil War than many economists and historians currently believe."
The new Confederacy also needed revenue and it passed a tariff of about 15%. Much more important it imposed its tariff on all imports from the USA. If there had been peace this would be an enormously disruptive event, forcing all local trade across new international boundary to funnel through custom houses and be taxed. [Carlander and Majewski 2003] Of course the Lincoln government refused to recognize the Confederacy as independent and did not impose a tariff on goods moving from south to north. Nor did the Confederacy ever collect significant tariff revenues (it collected a mere $3 million from 1861-65). The US had imposed a blockade on foreign trade with the south and a war embargo on north-south trade in provisions deemed to be helpful to the Confederate war efforts.
The British debate
A debate was waged in England over which side to support in the war, but the Morrill tariff angered many leading figures.
As one diplomatic historian has explained, the Morrill Tariff: [Johnson p 14]
"Not unnaturally gave great displeasure to England. It greatly lessened the profits of the American markets to English manufacturers and merchants, to a degree which caused serious mercantile distress in that country. Moreover, the British nation was then in the first flush of enthusiasm over free trade, and, under the lead of extremists like Cobden and Gladstone, was inclined to regard a protective tariff as essentially and intrinsically immoral, scarcely less so than larceny or murder. Indeed, the tariff was seriously regarded as comparable in offensiveness with slavery itself, and Englishmen were inclined to condemn the North for the one as much as the South for the other. "We do not like slavery," said Palmerston to Adams, "but we want cotton, and we dislike very much your Morrill tariff."
Karl Marx, then writing in Britain, supported the North and downplayed the tariff issue. He argued that the major cause of secession was slavery – and that the tariff was just a pretext. Marx wrote, in October 1861:
Naturally, in America everyone knew that from 1846 to 1861 a free trade system prevailed, and that Representative Morrill carried his protectionist tariff through Congress only in 1861, after the rebellion had already broken out. Secession, therefore, did not take place because the Morrill tariff had gone through Congress, but, at most, the Morrill tariff went through Congress because secession had taken place.
Representative of hostile English opinion was an unsigned article in a literary magazine owned by novelist Charles Dickens. Although Graham Storey in The Letters of Charles Dickens attributes the actual authorship of the article to staff writer Henry Morley, Dickens scholars do agree that the article was representative of the novelist, who was in favor of the British free trade position. The article entitled "The Morrill Tariff" appeared in magazine All the Year Round on 28 December 1861:
If it be not slavery, where lies the partition of the interests that has led at last to actual separation of the Southern from the Northern States? …Every year, for some years back, this or that Southern state had declared that it would submit to this extortion only while it had not the strength for resistance. With the election of Lincoln and an exclusive Northern party taking over the federal government, the time for withdrawal had arrived … The conflict is between semi-independent communities [in which] every feeling and interest [in the South] calls for political partition, and every pocket interest [in the North] calls for union … So the case stands, and under all the passion of the parties and the cries of battle lie the two chief moving causes of the struggle. Union means so many millions a year lost to the South; secession means the loss of the same millions to the North. The love of money is the root of this, as of many other evils.… [T]he quarrel between the North and South is, as it stands, solely a fiscal quarrel.
Although trade between the US and Britain was flat during the war, it soared afterwards. Despite the high American tariff British exports in 1866-70 were 50% higher than before the war, so the anger subsided. Looking back in 1903 Britain's leading economist Alfred Marshall concluded:
Foreign trade, therefore, is not necessary to the United States. Her domestic trade is larger than that of the whole Western world was when she achieved her independence. Protection could not possibly do her much harm; and it is probable that the help given by her to a few industries, which really needed help, about compensated for the economic loss (but not for the moral injury) caused in other directions by her protective policy.
American historians weigh in
Historians including Allan Nevins and James M. McPherson downplay the significance of the tariff dispute, arguing that it was secondary to the issue of slavery. They point out that slavery dominated the secessionist declarations from the four states that published them (only Georgia's mentions tariffs at length). Nevins also points to the argument of Alexander Stephens, who initially opposed Georgia's secession and who, in a speech to the Georgia Secession Convention, disputed the severity of the threat that the Morrill Bill posed; although by the time of his Cornerstone Speech (March 1861), he makes a strong point of how Georgia in particular was "compelled to pay into the common treasury several millions of dollars for the privilege of importing the iron, after the price was paid for it abroad" thus making its ambitious rail building even more expensive. However, the "cornerstone" he refers to was slavery and he made it clear that was the "immediate cause" of the war.
Civil War Historians
- Charles and Mary Beard. The Rise of American Civilization (1928)
- Richard Hofstadter, The Progressive Historians--Turner, Beard, Parrington (1968)
- Jay Carlander and John Majewski. "Imagining 'A Great Manufacturing Empire': Virginia and the Possibilities of a Confederate Tariff," Civil War History Vol. 49, 2003
- William Freehling and Craig Simpson, editors. Secession Debated: Georgia's Showdown in 1860. (1992) ISBN 0-19-507945-0.
- Richard Hofstadter, "The Tariff Issue on the Eve of the Civil War" in American Historical Review, Vol. 44, No. 1 (Oct., 1938), pp. 50-55 
- Reinhard H. Luthin, "Abraham Lincoln and the Tariff" in The American Historical Review Vol. 49, No. 4 (Jul., 1944), pp. 609-629
- McPherson, James M. Battle Cry of Freedom: The Civil War Era (1988)
- Nevins, Allan. Ordeal of the Union, an 8-volume set (1947-1971), Vol. 4 "Prologue to Civil War, 1859-1861"
- David Potter, The impending crisis, 1848-1861 (1976)
- Rhodes, James Ford. History of the Civil War, 1861-1865 (1918)
- Heather Cox Richardson, The Greatest Nation of the Earth: Republican Economic Policies during the Civil War (Cambridge: Harvard University Press. 1997)
Economists and Economic Historians
- Paul Bairoch, (1993), Economics and World History: Myths and Paradoxes
- Robert McGuire and T. Norman Van Cott. "The Confederate constitution, tariffs, and the Laffer relationship", Economic Inquiry, Vol. 40, No. 3 - 2002
- Paul Studenski and Herman E. Krooss. Financial History of the United States: Fiscal, Monetary, Banking, and Tariff, Including Financial Administration and State and Local Finance (1952)
- Charles R. Morris. The Tycoons: How Andrew Carnegie, John D. Rockefeller, Jay Gould, and J. P. Morgan Invented the American Supereconomy (2005)
- Frank Taussig, The Tariff History of the United States (1911)
- Willis Fletcher Johnson; America's Foreign Relations. Volume: 2 (1916).
- The Congressional Globe at the Library of Congress
- The Abraham Lincoln Papers at the Library of Congress
- ^ Frank Taussig
- ^ econlib.org
- ^ The Tariff History of the United States
- ^ (McGuire and Van Cott, p. 435)
- ^ (Carlander and John Majewski 2003)
- ^ (1938 p 53)
- ^ (1978, p. 201)
- ^ U.S. Tariff Rates - Ratio of Import Duties to Values: 1821-1996
- ^ (Richardson, 100, 113)
- ^ (Richardson 114)
- ^ (p. 105)
- ^ (p. 99)
- ^ (p. 622)
- ^ John Sherman's Recollections of Forty Years in the House, Senate, and Cabinet: An Autobiography 1895.
- ^ Freehling and Simpson pg. 44-50. In Toombb's November 13, 1860 speech to the Georgia Secession Convention, he makes it clear the role of slavery in secession. For example, he stated, "For twenty years this part has, by Abolition societies, by publications made by them, by the public press, through the pulpit and their own legislative halls, and every effort -- by reproaches, by abuse, by vilification, by slander -- to disturb our tranquility -- to excite discontent between the different classes of our people, and to excite our slaves to insurrection. ... I say the time has to redress these acknowledged wrongs, and to avert even greater evils, of which these are but the signs and symbols."
- ^ Full Index
- ^ Address of South Carolina to Slaveholding States by Convention of South Carolina
- ^ (p. 626)
- ^ Biographies
- ^ Alfred Marshall. Official Papers ed by John Maynard Keynes. London: Macmillan and Co., 1926. p 398.
- A Brief Explanation of the Impact of the Morrill Tariff Posted on the Patriotist.com blog by Mike Scruggs, a member of Sons of Confederate Veterans.
- Marx & Engels - English newspaper articles on the American Civil War
- US Tariff rates from 1820 to 1996, from Historical Statistics of the United States
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