How did the McKinley Tariff Act hurt the farmers?
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The McKinley Tariff Act, passed by the United States Congress in 1890, imposed high tariffs on imported goods. While the intention of the act was to protect American industries, it ended up having adverse effects on farmers. Here's an explanation of how the McKinley Tariff Act hurt the farmers:
1. Increased Prices: The act led to a significant increase in the prices of imported goods, which included raw materials and manufactured products that were essential for farmers. This made it more expensive for farmers to purchase necessary equipment, machinery, and supplies, resulting in increased production costs.
2. Reduced International Demand: The high tariffs enacted by the McKinley Tariff Act also had the unintended consequence of reducing international demand for agricultural exports. As other countries responded with retaliatory tariffs, it became more difficult for American farmers to sell their products abroad. This, in turn, caused an oversupply of agricultural goods within the United States, leading to falling prices and lower profits for farmers.
3. Limited Competition: By imposing high tariffs, the McKinley Tariff Act essentially limited the competition faced by domestic industries. This allowed domestic manufacturers to increase their prices, leading to higher costs for farmers when purchasing agricultural machinery, equipment, and other inputs. Farmers were at a disadvantage because they could not easily switch to alternative suppliers due to the limited competition in the market.
4. Lack of Price Stability: The McKinley Tariff Act contributed to the instability of agricultural prices. As international demand decreased, farmers faced a surplus of agricultural products within the domestic market. With an oversupply of goods, prices dropped significantly, leading to financial hardship for many farmers. This lack of price stability made it difficult for farmers to plan their production and manage their finances effectively.
In summary, the McKinley Tariff Act hurt farmers by increasing prices of imported goods, reducing international demand for agricultural exports, limiting competition, and causing price instability. These factors combined to create financial burdens and economic challenges for farmers during this time period.