Mad King Trump's Tariff Disaster [View all]

[Celerity]

https://prospect.org/economy/2025-03-12-mad-king-trumps-tariff-disaster/



One of the factors that worsened the Great Depression was the international retreat from foreign trade. As the global economy collapsed, countries attempted to protect their home markets with tariffs, led by the United States, whose Smoot-Hawley Tariff, signed into law by President Hoover in 1930, touched off a massive trade war. Though this was not the principal cause of the crisis, economists generally agree it made things worse. Instead of protecting home markets, the trade war merely choked off a source of foreign demand for American-made goods and services, shrinking output and causing even more unemployment.

Donald Trump is doing his Hooverian predecessor one better. His on-again, off-again trade war on Mexico and Canada got real last week with the imposition of 25 percent tariffs on most goods crossing the border. Canada retaliated in kind, and the province of Ontario, whose government owns many large hydroelectric dams, imposed a 25 percent tariff on electricity going to the American Northeast.

Things heated up further on Tuesday when Trump announced, as usual by way of

Okay it's back
truthsocial.com/@realDonaldT...

— George Pearkes (@peark.es) 2025-03-11T14:06:54.180Z" target="_blank">an incoherent wall of text posted on Truth Social, that the tariff on Canadian steel and aluminum would increase to 50 percent in retaliation. Ontario Premier Doug Ford had previously threatened to cut off power to the U.S. entirely if Trump kept escalating.

Then, as I was writing this article, Trump

*TRUMP: LOOKING AT BACKING DOWN ON THE 50% DUTIES ON CANADA
*TRUMP: MAY BACK OFF DOUBLING STEEL, ALUMINUM CANADA TARIFFS
*TRUMP ON CANADA: WILL PROBABLY MAKE DIFFERENT TARIFF DECISION

— George Pearkes (@peark.es) 2025-03-11T19:09:52.889Z" target="_blank">reportedly reconsidered his escalation. So far, however, the Canadian national government, for entirely understandable reasons, has said it will keep its tariffs up until Trump stops with the syphilitic emperor routine. Unlike Smoot-Hawley, the Trump tariffs, even if they don’t escalate continually, might single-handedly cause a severe recession in America or even the world.

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