A Good Customer Threatens to Walk Out is a political cartoon by John Knott seeking to give immediacy and perspective to the problem of Franklin Delano Roosevelt’s new tariff on cotton goods during a fragile time in the history of the United States of America: The Great Depression. The cartoon depicts the two parties affected by the tariff – The Japanese and American textile departments. Although the “Raw Cotton for Export” is plentiful, and “Japan’s Textile Industry” is readily available, trade cannot occur because of the piece of paper that is sitting between the Japanese and American characters – the tariff on Japan’s cotton goods. The editorial accompanying this cartoon, “Cotton Blunder,” tells the story that explains the visible tension in the scene. Effective June 20th, 1936, President Roosevelt decided to raise taxes on Japanese cotton by 42 per cent. “The new tariff action will give [Japan] an excuse to retaliate by buying less raw cotton from America and more from other countries” (“Cotton Blunder” 9). Although Roosevelt was trying to help American textile companies by placing a tariff on Japanese imported textiles, it only angered Japan and threatened to perpetuate the Great Depression even further due to its implications.
After the devastating stock market crash of 1929, America’s economy had started a seemingly unstoppable downward spiral. Herbert Hoover was the standing president at the time, and although it was not his fault the American economy had crashed, it was his fault it had gotten worse. One of the worst decisions he made as president was passing the notorious “Smoot-Hawley” Tariff Act which imposed 20,000 record-high taxes on imported goods. As if facing increased inflation and skyrocketing prices for common goods was not bad enough, now people were expected to pay extra money for foreign goods (Henderson). Though it was supposed to stimulate domestic economy, it only closed the metaphorical Pandora’s box of American economics before hope could escape. This tariff hurt other nations’ economies as well, since the U.S. was previously a prominent trade partner for many countries. Now, however, their goods were not selling in the U.S. so the immediate reaction from affected countries was to enact tariffs of their own in response. Consequentially, the “Smoot-Hawley” Tariff Act set off a chain of trade blockades in the global marketplace until the world had become divided into economic blocks; effectively making the Great Depression a worldwide event.
The “Smoot-Hawley” Tariff Act was not only the downfall of the Herbert Hoover administration; it was also a catalyst for the rise of the Franklin Delano Roosevelt administration. In his campaign for president, FDR told the American people that he would lower tariffs during his presidency. True to his word, after he was elected, FDR passed the Reciprocal Trade Agreements Act in 1934. (Koyama) This act allowed Roosevelt to negotiate reciprocal trade agreements with other nations. However, in 1936, Roosevelt was faced with a dilemma: Northern American textile companies were pushing for government intervention in their competition with the increasingly successful Japanese textile market. “The immediate effects of this tremendous increase in imports from Japan, irrespective of the relation of their total volume to the total American production and consumption, were the ever-present threat to the American price structure and the resultant uncertainty and instability which had marked the American market since the influx began” (Murchison 273). But as wary as Roosevelt was about this problem of a weakened domestic industry, he was also reserved about implementing tariffs. He sought a gentleman’s agreement with Japan to set a quota that would limit shipments to about 45,000,000 square yards of cotton annually in order to regulate the influx of foreign goods. Unfortunately, talks for this agreement suddenly collapsed in May, and as a result, Roosevelt passed a 42% tariff on Japanese cotton goods.
Textile interests expressed satisfaction today over the president’s proclamation raising tariff walls in an effort to halt a sharp increase in shipments of cotton cloth from Japan to this country. President Roosevelt acted after the tariff commission reported importations of Japanese cotton goods rose rapidly during the first quarter of this year following failure to effect a “gentlemen’s agreement” with the island empire to restrict cotton textile exports to the United States. By proclamation issued yesterday under the 1930 flexible tariff act, the president increased tariffs approximately 42%, effective June 20. The higher rates will apply to the types of cotton cloth of which Japan supplies about 90% of this country’s imports, the remainder coming from Great Britain and Switzerland. The proclamation followed recommendations of the tariff commission, which investigated costs of domestic and foreign cotton cloths last year. (Tariff Hiked on Japanese Cotton Goods)
This article came out about the same time that the Dallas Morning News editorial came out. As Knott’s cartoon points out, southern cotton producers and middle men had benefitted from Japan’s increasing presence in the marketplace since Japan bought raw cotton from American manufacturers; a fact overlooked by the Roosevelt administration when making the decision to implant the tariff. In trying to stimulate the northern cotton textile companies, he effectively killed southern ones. This wasn’t the only problem Roosevelt now faced; he had also started a trade war with the Japanese. There are two ways they could retaliate now; either by implementing a counter-tariff on American goods in Japan, or by simply halting trade with the U.S. therefore Japan appears to be an unhappy customer in the cartoon, verbally threatening to take his trading business elsewhere. A frightened Uncle Sam is seen to the right, frantically asking for someone to call for Mr. Hull, the current secretary of state. After this cartoon was published, it was Mr. Hull that, with cooperation from the Japanese Embassy at Washington, could peacefully end this potentially disastrous tariff (Woolner).
This cartoon is comedic due to its use of visual humor. The Japanese man appears angry, slamming his fist on the counter, anyone’s natural response upon learning that they have been betrayed. The way the man is drawn is also a source of humor, since features like big teeth and large, circular glasses give a stereotypical American view of the Japanese at that time.
Franklin Delano Roosevelt made a big mistake by raising tariffs; a mistake that he should have avoided after seeing the negative effects raising tariffs had on the country under Herbert Hoover’s administration. He would have started a trade war with Japan and worsened the Great Depression if not for the efforts of the secretary of state at that time, Cordell Hull. In the end, Japan and America made a compromise in trade and America survived this “cotton blunder.” The lesson learned was that what may be a good idea in theory can backfire when a president’s vision fails to reach further than his own borders.
Balio, Tino. “Surviving the Great Depression.” Grand Design: Hollywood as a Modern Business Enterprise, 1930-1939. Ed. Charles Harpole. Vol. 5. New York: Charles Scribner’s Sons, 1993. 13-36. History of the American Cinema 5. Gale Virtual Reference Library. Web. 24 Oct. 2016.
Berglund, Abraham. “The Tariff Act of 1930.” The American Economic Review, vol. 20, no. 3, 1930, pp. 467–479.
“Cotton Blunder.” The Dallas Morning News 26 May 1936: 2. Print.
Henderson, David R. “Hoover’s Economic Policies.” The Concise Encyclopedia of Economics. Indianapolis, IN: Liberty Fund, 2008. Print.
Koyama, Kumiko. “The Passage of the Smoot-Hawley Tariff Act: Why Did the President Sign the Bill?” Journal of Policy History 21.2 (2009): 163–186. Web.
Murchison, Claudius T. “American-Japanese Cotton Goods Agreement.” Journal of Marketing, vol. 2, no. 4, 1938, pp. 272–277.
“Tariff Hiked On Japanese Goods.” Newspapers.com. The Lincoln Star, n.d. Web. 24 Oct. 2016.
Woolner, David B. “Hull, Cordell.” Encyclopedia of the Great Depression. Ed. Robert S. McElvaine. Vol. 1. New York: Macmillan Reference USA, 2004. 485-486. Gale Virtual Reference Library. Web. 24 Oct. 2016.
Zeiler, Thomas W. “Tariff Policy.” Encyclopedia of American Foreign Policy. Ed. Richard Dean Burns, Alexander DeConde, and Fredrik Logevall. 2nd ed. Vol. 3. New York: Charles Scribner’s Sons, 2002. 531-546. Gale Virtual Reference Library. Web. 24 Oct. 2016.