§ 1351) provided for the negotiation of tariff agreements between the United States and separate nations, particularly Latin American countries.
The Reciprocal Tariff Act was promoted heavily by Secretary of State Cordell Hull.
President Franklin D. Roosevelt signed the Reciprocal Trade Agreements Act (RTAA) into law in 1934.
In response to the Great Depression, Congress accelerated its protectionist policies, culminating in the Smoot–Hawley Act of 1930, a smorgasbord of high tariffs across many American industries.
From then on, rounds and free trade area negotiations in GATT (later WTO) included the negotiating powers of non-tariff measures in the respective legislation, such as the Trade Law of 1974, was granted to the President, but the power to reduce tariffs was generally similar to the RTAA.
Individual members of Congress were under great pressure from industry lobbyists to raise tariffs to protect it from the negative effects of foreign imports.
[3] The RTAA's novel approach freed Roosevelt and Congress to break that trend of tariff increases.
[3] Reciprocity was an important tenet of the trade agreements brokered under RTAA because it gave Congress an incentive to lower tariffs.
The President had to consider the welfare of all Americans, his foreign policy priorities, and what was feasible with other countries in making his decisions on tariffs.
Democrats skeptical of reducing tariffs during the Depression included Representative Henry Rainey (D-IL) and members of Roosevelt's own administration: Rexford Tugwell, Raymond Moley, and Adolf Berle.
In 1936 and 1940, the Republican Party ran on a platform of repealing the tariff reductions secured under the RTAA.
In the years since the enactment of the RTAA in 1934, the economies of Europe and East Asia had been decimated by the violence of World War II, which left a huge global production vacuum that was filled by American exporters.
Republican preferences for tariffs started shifting, as exporters from home districts began to benefit from increased international trade.
[3] Another key feature of the RTAA was that if Congress wanted to repeal a tariff reduction, it would take a two-thirds supermajority.
[19][20] The US Department of State also found good use of the expansion of free trade after World War II.
Many in the State Department saw multilateral trade agreements as a way to engage the world in accordance with the Marshall Plan and the Monroe Doctrine.
That pursuit of free trade as diplomacy intensified during the Cold War, as the US competed with the Soviet Union for relationships around the globe.