The Cider Rip-off: Abe Lincoln’s Tariff Story

 

New York City docks (1860s)

In today's complex economic landscape, the topic of tariffs has become a "hot button" issue. Originally, when tariffs were imposed, they were meant to protect domestic industries by making imported goods more expensive to buy. However, the actual flow of money and who truly benefits can be complicated and difficult to trace. While the intention is to support local businesses, the reality is that consumers may end up paying higher prices, and the overall economic impact can be unpredictable.

 As we now face the growing confusion and the up-and-down approach to the modern intricacies of international trade and revenue generation, it's worth reflecting on a humorous yet relevant story Abraham Lincoln - known for his wit and keen insight - once told about tariffs.

Lincoln was talking with his advisors about the cost of the war and the government's dwindling money supply. One of his advisors suggested increasing the tariffs.

Lincoln pondered the comment for a few minutes and then said:

There is something obscure about it [tariffs]. It reminds me of the fellow that came into a grocery down in Menard County at [New] Salem where I once lived, and called for a picayune's [a small coin of little value] worth of crackers; so the clerk laid them on the counter. After sitting for awhile, he said to the clerk, "I don't want these crackers. Take them and give me a glass of cider." So the clerk put them back in the box and handed the fellow the cider. After drinking it, he headed for the door.

"Hey Bill," called the clerk. "pay me for your cider."

"Why," said Bill. 'I gave you crackers for it."

"Well then, pay me for the crackers."

"But I didn't have any," responded Bill.

"That's so," said the clerk. "Well, get out! It seems to me that I've lost a money somehow, but I can't make out exactly how it happened."

Lincoln looked at his advisor. "So it is with the tariff," he said. "Somebody gets the money, but I don't understand exactly how."

Lincoln's anecdote about the picayune's worth of crackers and the glass of cider highlights the complexities and unintended consequences of tariffs. Just as the clerk couldn't quite figure out how he lost money in the exchange, tariffs can create a labyrinth of financial exchanges that are difficult to fully grasp. In modern times, the imposition of tariffs can have far-reaching effects on the economy, often benefiting some industries while disadvantaging others. As policymakers continue to debate the merits and drawbacks of tariffs, Lincoln's story serves as a reminder to all of us that economic strategies should be carefully scrutinized to avoid unforeseen losses and ensure a fair and balanced approach for all stakeholders.

By reflecting on Lincoln's words, we can better appreciate the need for clear and well-informed economic strategies that protect the well-being of all citizens.

Always remember: The answers to many of today's issues often lie in history. We just have to look.

This is another story from Abe Lincoln, Storyteller.

Mac