French-American Commercial Feuds (1/5): The Chicken War

Franco-American history features a number of commercial and diplomatic disputes, from the “chicken war” in the 1960s to Donald Trump’s recent declarations about taxing steel and aluminum imported from Europe. With its boycotts and protectionist policies, we explore these conflicts through five episodes looking at the history of certain controversial products.

Episode 1: The Chicken War

In the middle of the Cold War, President Lyndon B. Johnson launched one of the first economic conflicts between the United States and the Europe. In retaliation against a Franco-German tax on imported American chicken, he approved a law in 1963 than imposed customs duties of 25% on pick-up trucks and other lightweight utility vehicles made abroad. This head-to-head – nicknamed the “chicken war” – had “businessmen and government officials on both sides of the Atlantic alternating between lamentation and laughter,” according to the New York Times.

The Source of the Conflict

Several U.S. states such as Arkansas developed an intensive chicken farming sector during World War II. Chicken became a standard part of the American diet and was exported en masse to Western Europe. In 1961, chicken from the United States made up half of the European market.

Consumer groups in France grew concerned about the over-production of American chicken and its effect on the market share of European producers. In the face of such competition, the Europeans began undermining U.S. chicken by any means necessary, including criticizing American sanitary standards.

Producers pointed the finger at animal farming and processing conditions. The government began worrying – and rightly so – about the effects of hormones in American meat on its consumers’ health and virility. In Germany, U.S. farmers were even accused of feeding their livestock arsenic.

France and America took advantage of the creation of the CAP (Common Agricultural Policy) in 1962 to apply a 50% tax on products imported from America and develop their own intensive farming sector. The U.S. government was outraged at the decision, and the American farming industry lost more than 25 million dollars as a result.

From Chicken to Automobiles

Having failed to resolve the situation by diplomatic means, President Lyndon B. Johnson passed the “chicken tax” in reply. Instead of taxing meat from Europe, he increased customs duties on imported products by 25%. The new legislation affected French brandy (cognac and armagnac), potato starch, dextrin (a thickening agent extracted from starch used to make “natural” glue for envelopes), and all trucks carrying goods. The decision to levy duties on transport vehicles was a direct attack on Volkswagen pick-ups and vans to protect the American market from German competition.

In an effort to get around these excessive import duties, Mercedes and Ford began exploiting legal loopholes. They presented pick-ups and trucks as passenger vehicles by adding more seats and seatbelts, all of which were dismantled upon arrival in the United States. The closure of the U.S. automobile market did however suffocate innovation and competition for many years, and American historian John Conybeare even sees it as one of the reasons for the failure of Chrysler and General Motors.

Only the tax on vehicles remains in place today. The tariffs on chicken were smoothed over during different rounds of negotiations that led to the creation of the European Union. Konrad Adenauer, who was the German chancellor during the “chicken war,” admitted years later that almost half of his discussions with the American president were about chicken!