World Trade: Shades of Smoot & Hawley

Tacked onto the 10% tax-surcharge legislation that sailed through the Senate last week was a quiet proviso that could become the first shot in an economically devastating trade war between the U.S. and most of its close allies.

The measure would limit imported woolen and man-made textiles to 8.6% of domestic consumption, a level well below the 10.1% of the market that such foreign products snared last year. The Senate came within a single vote (38-37) of adding a quota on dairy imports to the same tax bill. House negotiators may well resist...