Tariffs favored U.S. companies by letting them compete for free in the U.S. market, while a cover charge was placed on foreign goods entering the U.S.A. Foreign producers would pay tariffs for the privilege of competing here, while U.S. companies paid income taxes.
Foreigners had to buy a ticket to the game. Americans got in free.
After all, it's our country, isn't it?
But in the late 20th century, America abandoned as "protectionism" what Henry Clay had called The American System. We gave up on economic patriotism. We gave up on the idea that the U.S. economy should be structured for the benefit of America and Americans first.
We embraced globalism.
The ideological basis of globalism was that, just as what was best for America was a free market where U.S. companies produce and sell anywhere freely and equally in the U.S.A., this model can be applied worldwide.
We can create a global economy where companies produce where they wish and sell where they wish.
As one might expect, the big boosters of the concept were the transnational corporations. They could now shift plants and factories out of the high-wage, well-regulated U.S. economy to Mexico, China and India, then to Bangladesh, Haiti and Cambodia, produce for pennies, ship their products back to the U.S.A., sell here at the same old price, and pocket the difference.
As some who were familiar with the decline of Great Britain predicted, this would lead inexorably to the deindustrialization of America, a halt to the steady rise in U.S. workers' wages and standard of living, and the enrichment of a new class of corporatists.
Meanwhile, other nations, believing yet in economic nationalism, would invade and capture huge slices of the U.S. market for their home companies, their "national champions." The losers would be the companies that stayed in the U.S.A. and produced for the U.S.A., with American workers.
And so it came to pass. U.S. real wages have not risen in 40 years.
In the first decade of the century, America lost 5 million to 6 million manufacturing jobs, one in every three we had, as 55,000 factories closed.
Since Bush 41 touted his New Word Order, we have run trade deficits of $10 trillion -- ten thousand billion dollars! Everybody -- the EU, China, Japan, Mexico, Canada -- now runs a trade surplus at the expense of the U.S.A.
We built the global economy -- by gutting our own.