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Tariff of 1894

William L. Wilson of West Virginia, head of the House Ways and Means Committee, introduced a far-reaching tariff reform bill. It added a number of items to the free list, including sugar, lumber, coal and wool. Further, the duties on imported manufactured goods would be reduced while maintaining their protective nature. To compensate for the revenue shortfall that tariff reform would create, Wilson’s bill called for the imposition of a two percent income tax, an idea recently heralded by the Populists. The Wilson bill passed the House and moved on to the Senate where protectionist forces under A.P. Gorman of Maryland went to work. They managed to attach more than 600 amendments to the measure, which destroyed its reform intent. The domestic sugar industry was one of the prime benefactors, since a whopping 40 percent duty was applied to foreign sugar. In the end, both the House and President Cleveland surrendered to the Senate’s will. The resulting Wilson-Gorman Tariff offered slight reductions in the overall average rates, an improvement over the McKinley Tariff, but not an example of tariff reform. Cleveland’s lack of involvement hurt his reputation. He had campaigned on tariff reform, but allowed the bill to become law without his signature. The president rationalized that Wilson-Gorman was better than McKinley and so decided against a veto. The income tax provision survived and became law. In 1895, however, the Supreme Court ruled the tax unconstitutional. The Populists of the South and West labored under the disadvantage of a high protective tariff and, after the court decision, became convinced that the judicial system was working hand-in-glove with big business.

What is a Tariff? Also see tariff table summary.