Today marks the 80th anniversary of the Reciprocal Trade Agreements Act (RTAA), a new approach to trade policy adopted by the New Deal Congress and signed by President Franklin D. Roosevelt. The RTAA was the first time Congress and a president worked together to adopt trade bargaining power, to pass new trade agreements that would increase exports and support the creation of new jobs. Through the RTAA, Congress set the framework for international trade negotiations and authorized the president to exercise U.S. leadership in the international trading system. Democrats voted much more often for trade liberalization than Republicans, but were not uniform in their preferences. Congressman Henry Rainey (D-IL) and members of Roosevelt`s own government, Rexford Tugwell, Raymond Moley and Adolf Berle, were among the skeptical Democrats during the depression. However, the government decided to use a Democratic-controlled Congress and Presidency to impose the RTAA. In 1936 and 1940, the Republican Party ran on a platform to lift guaranteed tariff reductions under the RTAA. But when they took over Congress in 1946, they did not act to lift tariffs. In the years following the adoption of the RTAA in 1934, the economies of Europe and East Asia had been decimated by the violence of World War II, leaving a huge global production vacuum filled by American exporters. [2] During the war, the United States had its highest positive account balance in its history. Republican preferences for tariffs began to shift when exporters in the districts of origin began to benefit from increased international trade.

In the 1950s, there was no statistically significant difference between Republicans and Democrats in customs policy, a change that has been going on ever since. [3] Soon, 25 countries had taken retaliatory measures by increasing their own tariffs. As a result, international trade fell dramatically, resulting in a global decline of 66% between 1929 and 1934. Both U.S. exports and imports have declined significantly. The RTAA`s new approach freed Roosevelt and Congress from breaking this trend of tariff increases. It has linked U.S. tariff reductions to reciprocal tariff reductions with international partners.

It also allowed Congress to approve tariffs by simple majority, unlike the two-thirds majority required for other treaties. In addition, the president had the power to negotiate the terms. The three trade policy innovations have created the political will and feasibility of implementing a more liberal trade policy. [3] A notable loser in the trade wars was Germany, which was already struggling to repay war reparations to the United States and other victorious nations from the war. The U.S. State Department also appreciated the expansion of free trade after World War II. Many at the State Department saw multilateral trade agreements as a way to engage the world in accordance with the Marshall Plan and the Monroe Doctrine. U.S. trade policy has become an integral part of U.S. foreign policy. This pursuit of free trade as diplomacy intensified during the Cold War, when the United States competed with the Soviet Union for relations around the world. [20] Although the world has changed dramatically since FDR passed the Reciprocal Trade Agreements Act, the fundamental promise of trade remains the same.

Done right, trade policy gives American workers the opportunity to compete under conditions of equal action, and under TPA, Congress and the government cooperate to manage trade with global partners by setting goals and standards that represent American interests and values.