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.
Efforts to revise the tariff schedule began in earnest in 1858 amidst a contentious battle for control of the House of Representatives. The Know Nothing movement and a split within the Democratic Party over the Lecompton Constitution resulted in no party having a clear majority in the House of Representatives for the 36th Congress, and thus no clear choice for Speaker of the House emerged for over three months. Amidst the turmoil, members of the House Ways and Means Committee submitted competing plans for a revision to the tariff schedule. The Democratic plan, authored by outgoing chairman John S. Phelps, retained most of the status quo from the 1857 Tariff plus minor revisions designed to stimulate revenue. The Republican plan, authored by Morrill and Maryland representative Henry Winter Davis, sought an upward revision of the tariff schedule.
The Republican proposal replaced the existing ad valorem tariff schedule with specific duties and drastically increased rates on popular "protected" industries such as iron, textiles, woolen goods, and manufactured items. Economic historian Frank Taussig indicated that in many cases, the substitution of specific duties were used to disguise the extent of the rate increases.
Morrill's break came in early 1859 when the Republicans succeeded in electing pro-tariff Rep. William Pennington of New Jersey as Speaker. Pennington appointed a Republican majority to the committee and a new chairman, Rep. John Sherman of Ohio. Sherman's appointment cleared the way for Morrill's proposal to come to the House floor during the Spring session of 1860.
The Morrill Tariff 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 deep south 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.
The tariff was submitted to the Senate for a vote on May 11, where it was referred to the Senate Finance Committee. Senator Robert M. T. Hunter of Virginia, a free trade advocate and author of the 1857 Tariff, served as chairman of this committee and successfully tabled the bill until Congress reconvened for the 1860 Winter session. Hunter's move had the effect of postponing the Senate's vote until after the 1860 election, effectively guaranteeing the tariff's prominence as a campaign issue.
Early on Republican party strategists recognized the need to carry the swing state of Pennsylvania, where protectionist sentiment was strong and the local congressional delegation favored the Morrill Tariff. The recently-formed Republican Party contained many ex-Whigs who adhered to the principles of Henry Clay and his American School of economics, including tariff protectionism.
Pennsylvania sent a strong pro-tariff delegation to the 1860 Republican National Convention under the guidance of Carey and other Republican leaders from the state. Working with prominent newspaperman Horace Greeley, Pennsylvania secured a pro-tariff plank in the Republican platform. The Pennsylvania delegation initially supported its home candidate Sen. Simon Cameron for President, but switched to Illinois' Abraham Lincoln when Cameron withdrew from the race. Lincoln was a former Whig and Clay disciple with a strong pro-tariff record from his days in Congress.
During the campaign of 1860 the Republican party stressed the tariff issue only in Pennsylvania and New Jersey, where the tariff issue played strong among voters. A targeted message was necessary because the tariff issue was unpopular in other states, especially the agricultural regions of the west. The Republican National Committee dispatched Morrill, Sherman, and several other tariff leaders to Pennsylvania and New Jersey to tout the Morrill Tariff and to speak as surrogates on the campaign trail for Lincoln. Meanwhile, the Lincoln campaign crafted a careful message specific to Pennsylvania under the slogan of "Protection to American Industry." In August Lincoln sent his manager David Davis to the state to organize the local Republican machines and coordinate with known tariff advocates including Cameron, Rep. Thaddeus Stevens, and GOP gubernatorial candidate Andrew Curtin.
Both Democratic tickets, John C. Breckenridge and Stephen Douglass, opposed the Morrill Tariff, protectionism in general, and the American System. Curtin's victory in the September state election was widely interpreted as a sign of the Republican tariff strategy's success. Lincoln carried Pennsylvania handedly in November, and split a portion of New Jersey's electoral votes.
The Senate again took up the Morrill bill in December after the election and intensely debated it for the next several months. At first it was widely believed that Hunter would be able to delay a Senate vote until the incoming 37th Congress. On February 14, 1861, president-elect Lincoln told an audience in Pittsburgh that he would make a new tariff his priority in the next session 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.
Hunter lost his hold on the Senate Finance Committee in February, when the Senate restructured its committees after the resignation of several senators from the seceding states of the deep south. This allowed Morrill's co-sponsor in the Senate, James Fowler Simmons of Rhode Island, to bring the bill to the floor for a vote. The Morrill Tariff finally came up for full debate on February 27th and passed into law on March 2 on a strictly sectional vote. The bill enjoyed unanimous support from the northern states and unanimous opposition from the remaining southern states. Though a Democrat himself, outgoing president James Buchanan favored the tariff due to the interests of his home state Pennsylvania. He signed the bill into law as one of his last acts in office.
The Morrill Tariff took effect one month after it was signed into law. The tariff had been written for peacetime with the purpose of protecting of industrial manufacturing, located mostly in the northeast, from foreign competitor products. Other provisions of the bill altered and restricted the Warehousing Act of 1846. 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. It was ill suited for the revenue needs of the Civil War though, and was prematurely supplanted by the Second Morrill Tariff, or Revenue Act of 1861, later that fall.
According to Taussig, "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 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.
The Morrill Tariff was met with intense hostility in Great Britain, where the free trade movement dominated public opinion. The new tariff schedule heavily penalized British iron, clothing, and manufactured exports with new taxes and sparked public outcry from many British politicians. The expectation of high rates probably caused British shippers to hasten their deliveries before the new rates took effect 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?
When the Civil War broke out in 1861, British public opinion was sympathetic to the Confederacy due to lingering agitation over the tariff. 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."
Many prominent British writers condemned the Morrill Tariff in the strongest terms. Economist William Stanley Jevons denounced it as a "retrograde" law. The well known novelist Charles Dickens used his magazine, All the Year Round, to attack the new tariff. On December 28, 1861 Dickens published a lengthy editorial, believed to be written by Henry Morley, in which he blamed the American Civil War on the Morrill Tariff:
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.
Communist philosopher Karl Marx was among the few writers in Britain who took a favourable view of the Morrill Tariff. Marx wrote extensively in the British press and served as a London correspondent for several North American newspapers including Horace Greeley's New York Tribune. Marx reacted to those who blamed the war on Morrill's bill, arguing instead that slavery had induced secession 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.
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 21861 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.
Though slavery dominated the secession debate in most southern states, the Morrill Tariff received considerable attention in the conventions of Georgia and South Carolina. On November 191860 Senator Robert Toombs gave a speech to the Georgia convention in which he denounced the "infamous Morrill bill." The tariff legislation, he argued, was the product of a coalition between abolitionists and protectionists in which "the free-trade abolitionists became protectionists; the non-abolition protectionists became abolitionists." Toombs described this coalition as "the robber and the incendiary...united in joint raid against the South." Anti-tariff sentiments also appeared in Georgia's Secession Declaration of January 29, 1861, written in part by Toombs.
Robert Barnwell Rhett similarly railed against the then-pending Morrill Tariff before the South Carolina convention. Rhett included a lengthy attack on tariffs in the Address of South Carolina to Slaveholding States, which the convention adopted on December 25, 1860 to accompany its secession ordinance.
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.
The Morrill Tariff played less prominently elsewhere in the south. In some portions of Virginia, secessionists promised a new protective tariff to assist the state's fledgling industries.
The Beard thesis has enjoyed a recent revival among economists, pro-Confederate historians, and neo-Beardian scholars. 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."
According to economist and libertarian historian Thomas DiLorenzo, this tariff was the primary cause of the Civil War. Most Civil War historians disagree. Allan Nevins and James M. McPherson downplay the significance of the tariff dispute, arguing that it was peripheral to the issue of slavery. They note that slavery dominated the secessionist declarations, speeches, and pamphlets. Nevins also points to the argument of Alexander Stephens, who disputed Toombs' claims about the severity of the Morrill tariff. Though initially a unionist, Stephens would later cite slavery as the "cornerstone" reason behind his support of the secessionist cause.