Tariffs and Depressions
There is a meme going around.
Obviously, it’s attacking Trump’s tariffs. The left and moderate Republicans have opposed them from the start as have many libertarians, but more remarkably, many traditional conservatives—and now even a few MAGA loyalists—have started questioning them.
But is it accurate?
Well, kind of. It's not as far off as you might assume, but there is always room for nuance and context.
The 1930 tariff might be the one more applicable to our current situation, so we'll start there. It refers to the Smoot-Hawley Tariff Act, and historians and economists are nearly unanimous: it didn’t help—it hurt. Badly. It amplified and prolonged the Depression, turning it from what was arguably a simple recession (albeit a big one) into the Great Depression.
The argument behind it was basically the same one Trump is using now: protect U.S. industry, bring production home, stick it to foreign competitors. It was signed into law in June of that year and raised tariffs on over 20,000 goods.
Did it work? Well, if your definition of "success" includes achieving the opposite of what you wanted, then sure. Otherwise, no—it was an abject failure. The initial results were that major trade partners like Canada, France, and others immediately slapped their own tariffs on American goods. Just like now! Who ever said history doesn't rhyme, eh?
The longer-term effects were devastating: global trade collapsed by about two-thirds between 1929 and 1934. This was catastrophic in an already fragile economic environment. Unemployment in the U.S. jumped from 8.7% in 1930 to 25% by 1933—and it was even worse in many other countries. And yes, U.S. tariffs hit the entire world. A trade war never has just one victim. The Depression spread to the world, becoming the Great Depression, and leading to all kinds of bad things.
So while we can’t blame the Depression entirely on the tariffs, they definitely threw gasoline on the fire and kept it burning longer.
The 1828 depression was fairly similar. We can't really call it a depression in the same way as the Great Depression; it was more a series of economic downturns that led to a bank panic in 1837 and political instability for much of the 30s.
I won't go into the details, but it was called the Tariff of 1828, nicknamed the Tariff of Abominations by the South. It was intended to protect Northern industry, but it really hurt the South which relied on imported goods and raw materials.
In theory, tariffs can have positive effects, if used tactically: in other words, they are surgical tools, not sledgehammers. When they are used en masse and bluntly as Trump is using them, historically they tend to lead to negative economic effects—both short-term (as the Trump people admit) and long-term (which is opposite all MAGA pundit rhetoric).
Using tariffs bluntly can appeal to populism, making them a favorite tool of demagogues, but they rarely have positive results and usually hurt the very people who support them (the working class) the most.
So, the meme? Mostly right, but like all good memes, it condenses a messy truth into a clean punchline. The history doesn’t say tariffs always fail (when used tactically). But it absolutely warns us that using them bluntly, vengefully, or for political theater has a long track record of backfiring. Whether 2025 ends up echoing 1930 and 1828 or not is still up in the air—but it ain't looking too good so far.
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David is an American teacher and translator lost in Japan, trying to capture the beauty of this country one photo at a time and searching for the perfect haiku. He blogs here and at laspina.org. Write him on Mastodon. |
But seriously... don't worry, this time will be different.
Also... Ford is running a sale. They seem to be trying to clean up their inventory for some reason (employee pricing). Obviously bullish.
Winning!
How many of our best conspiracy theorists have told us that the US ecomomy is being strategically destroyed? How many of them have analysed both of your examples and found that they were strategically employed to enrich the already the obscenely rich, and to rob the rest of us? How many times are we going to fall for this nonsense?
History has a nasty way of repeating. It's not that we don't learn from history, it's that we arrogantly think we can avoid it happening to us every time. Time will tell what happens this time.
I think we even arrogantly assume that it isn't happening to us right now, when it clearly is. "My government wouldn't do that" when it obviously is.
Anyone... Anyone...
Don't worry, I'm sure it will be different this time.
Dammit, I was hoping this was gonna be funny. !LOLZ !PIMP
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Sorry 😃 I'll work on a funner post next!
As a lifelong left-leaning independent who feels abandoned by the Democratic party I've really tried to keep an open mind about the tariffs. But it's getting scary at this point. I think we're in for a lot more pain next week, especially at tomorrow's stock market open. I believe if these tariffs go on for much more than a couple of months it could lead to a very difficult decade for America. Granted, the Fed couldn't just keep printing money forever to bolster the American economy but this is a huge hail Mary, and if history is any guide, there's a greater chance it will fail than succeed.
Unless Trump is visited by three ghosts, sees the error of his ways, and cancels all tariffs, it's hard to see how this won't lead to even worse things.
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All we can do is wait and see what happens this time! Time will tell... I always hope for the best though, better than the alternative. Then I would have to back to your you need to laugh post!
haha yeah, I'm with you. We can't really affect anything at this point. There are already tons of protests going on, but they aren't really doing much. All we can do is just sit back, hope for the best, and watch things to make us laugh!
Well said. !PIMP
The #TooFuckeh Orange Jesus told the truth the other day. He didn't say Make America Great Again, he said Make America Wealthy Again.
Translation: Wealthy Again means going to a period when there was more poverty. When that happens, shit will be cheat and those who still have money to buy will be set for the next uptick.
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I love your content. I am a conservative through and through but am receptive to hearing something "real" and not just the usual circle-jerk that happens on all news sites and a vast majority of social media. I always keep an open mind about things but it is just so tough to get real information when in most forums the discussion almost immediately implodes into name-calling and folks just making things up.
I appreciate what you are doing here. Thanks pal.