The International Relations Workshop presents
Professor Robert Gulotty, University of Chicago:
“Tariffs for the Defense Industrial Base.”
Do wartime industrial investments entrench post-war trade protection? Standard models of special interest politics predict that sectors expanded during war should receive higher tariffs, both because larger sectors gain more from protection and because wartime investment strengthens political organization. At the same time, the end of war also opens opportunities for foreign negotiating partners, which could lead to \emph{larger} negotiated tariff cuts even as domestic political pressure for protection rises. We reexamine the path of America’s post-World War II tariff liberalization, using plant-level capital expenditures from the U.S. War Production Board matched to post-war tariff changes and Congressional roll-call votes on RTAA renewals (1945–1949). Consistent with the mobilization channel, wartime investment in a district predicts protectionist voting in the House. Tariff-line regressions reveal that both channels operated simultaneously: in already highly protected sectors, wartime investment predicted smaller tariff reductions, consistent with entrenchment, while in less protected sectors, war-expanded industries received larger concessions, consistent with the negotiation channel. A case study of synthetic rubber illustrates how protection for war-expanded industries operated through non-tariff instruments—government stockpiling, mandatory blending requirements, and state ownership—that were excluded from the tariff negotiations. These findings suggest that wartime interests were internalized into ordinary trade politics rather than channeled through formal national security exceptions.