1. Introduction to the Gilded Age and the Allure of Tariffs

The Gilded Age, spanning from the 1870s to the early 1900s, was a transformative period for the United States. During this era, the nation saw rapid industrialization, significant population growth, and the rise of influential figures such as John D. Rockefeller and J.P. Morgan. President Donald Trump often romanticizes this period, highlighting its economic prosperity and advocating for a return to the protectionist trade policies that defined it. Trump frequently mentions the 1890s as a time when America was at its peak, attributing much of this success to tariffs. He has expressed a desire to emulate the economic strategies of the 25th President, William McKinley, who championed high tariffs during his tenure from 1897 until his assassination in 1901.

Trump has been inconsistent in implementing tariffs, imposing them in some cases and withdrawing them in others. However, he remains steadfast in his belief that protectionism is a viable strategy for the 21st century. He has even suggested that tariffs could potentially replace the federal income tax, though this idea has been met with skepticism from experts. Overall, Trump’s admiration for the Gilded Age and its economic policies reflects a broader desire to return to an era he perceives as a golden age of American prosperity.

2. The Gilded Age: A Complex and Divisive Era

The Gilded Age was marked by extraordinary wealth for a small elite, but it was also a time of widespread poverty, social inequality, and political corruption. The term "Gilded Age" itself, coined by Mark Twain in his 1873 novel The Gilded Age: A Tale of Today, satirized the greed and hypocrisy of the era. While industrialization brought about impressive technological advancements, many Americans, including industrial workers and farmers, suffered under harsh working conditions and limited social protections.

Historians argue that Trump’s nostalgia for this period overlooks its significant drawbacks. They note that the economic growth of the Gilded Age was fueled by factors such as technological innovation, immigration, and the expansion of natural resources, rather than tariffs alone. For example, the U.S. population grew from 38.5 million in 1870 to over 106 million by 1920, driven by massive waves of immigration that supplied cheap labor for the growing industrial economy. The seizure of Native American land and the exploitation of natural resources further contributed to economic expansion.

3. The Role of Tariffs in the Gilded Age

During the Gilded Age, tariffs were a central component of U.S. economic policy, particularly under President McKinley. McKinley championed the Tariff Act of 1890, which raised import taxes to some of the highest levels in U.S. history, including 49.5% on over 1,500 items. Proponents of high tariffs argued that they protected American industries and workers from foreign competition. However, critics contended that these policies led to inflation and disproportionately benefited large corporations and the wealthy, while harming consumers and smaller businesses.

Economic historians like Douglas Irwin of Dartmouth College have questioned Trump’s assertion that tariffs were the primary driver of the Gilded Age economy’s growth. Irwin points out that while tariffs contributed to federal revenue, they were not the main factor behind the era’s rapid expansion. Instead, the period’s growth was driven by technological innovation, industrialization, and the expansion of global markets. Irwin also notes that the Gilded Age economy was marked by volatility, including recessions and high unemployment, which undermines Trump’s portrayal of the era as a time of uninterrupted prosperity.

4. Modern Protectionism and Its Limitations

Trump’s advocacy for modern protectionism, inspired by the Gilded Age, has been met with skepticism by experts. They argue that the global economy of the 21st century operates under vastly different conditions than the economy of the late 19th century. Today, international trade is deeply interconnected, with global supply chains and instantaneous communication shaping the way goods and services are produced and distributed. Tariffs in the Gilded Age were often used as a primary source of federal revenue, but in the modern era, they account for a much smaller percentage of government income.

Furthermore, the idea of replacing the federal income tax with tariffs is widely regarded as impractical. In 2024, the federal government collected over $4 trillion in individual income taxes, compared to just $76.4 billion in customs duties. Karl Rove, a Republican strategist and author of The Triumph of William McKinley, has acknowledged that while low, reciprocal tariffs may have a role in modern trade policy, they cannot realistically replace the federal income tax. Rove notes that tariffs accounted for nearly half of U.S. government revenue from 1863 to 1913, but they now make up less than 2% of federal revenue.

5. William McKinley: A President of Contrasts

President William McKinley, whom Trump frequently praises, was a key figure in shaping the economic policies of the Gilded Age. McKinley’s commitment to protectionism and his leadership during the Spanish-American War, which expanded U.S. territory and influence, make him a model for Trump’s vision of American greatness. McKinley’s Tariff Act of 1890 and his emphasis on U.S. expansionism reflect his belief in the importance of a strong national economy and military.

However, McKinley’s presidency was not without its challenges. The Tariff Act of 1890, for example, led to widespread criticism and economic disruption, including inflation and public backlash that cost Republicans seats in Congress. McKinley’s later years in office also showed signs of shifting perspectives, as he began to recognize the importance of international trade and reciprocity. In a speech delivered shortly before his assassination, McKinley advocated for reducing tariffs and pursuing reciprocal trade agreements, signaling a departure from the strict protectionism of earlier years.

6. The Legacy of the Gilded Age and Its Relevance Today

Despite Trump’s romanticized view of the Gilded Age, the era’s policies and economic conditions bear little resemblance to those of the modern global economy. The Gilded Age was marked by significant social and economic inequality, with vast wealth concentrated in the hands of a few industrialists while millions of workers struggled with low wages and poor working conditions. The rise of the labor movement and progressive politics during this period reflects the widespread dissatisfaction with the economic and social realities of the time.

Trump’s identification with McKinley and the Gilded Age highlights his broader vision of American economic nationalism, but it also ignores the complexities and challenges of that era. The modern economy is characterized by global interdependence, technological advancements, and a vastly different social and political landscape. Attempts to apply Gilded Age policies to contemporary economic issues are likely to fail, as they do not account for the profound changes that have shaped the world over the past century.

In conclusion, while the Gilded Age represents an important chapter in American history, its lessons are complex and multifaceted. Trump’s nostalgia for this era oversimplifies its economic and social realities, ignoring the significant challenges faced by workers and the broader population during this time. As the U.S. continues to navigate the complexities of global trade and economic policy, it must look beyond simplistic solutions rooted in the past and instead embrace strategies that address the challenges of the 21st century.