Phil Gramm and Donald J. Boudreaux at WSJ:
In 1875 the great British economist Alfred Marshall visited the U.S. to see whether protective tariffs fueled economic growth. Before his visit, Marshall thought the infant industry argument for tariffs might have merit. What he observed in the U.S. changed his mind. In 1903, reflecting on his trip, Marshall wrote: “I found that, however simple the plan on which a protective policy started, it was drawn on irresistibly to become intricate; and to lend its chief aid to those industries which were already strong enough to do without it.”
While 19th-century American industrial output grew fastest when tariff rates were falling, trade policy was nevertheless largely incidental to America’s astonishing economic expansion. Growth was unleashed in a country whose citizens had more economic freedom than any people who had ever lived. It was this freedom that fueled entrepreneurship and productivity. Combined with the country’s vast natural resources and openness to foreign investment and immigration, this freedom—not tariffs—produced the American economic miracle.