Donald Trump has hit the 30-day pause button to impose 25 % tariffs on Mexico and Canada, but he is still planning to impose 10 % tariffs on Chinese imports. Tariffs on the EU are also on his agenda.
Trump has declared that “tariff” is” the most beautiful word in the dictionary”. The president might want to get a record book and put out the dictionary as he weighs up the broad repercussions of his tariff fixation.
The US Smoot-Hawley Tax Act, which was passed in 1930, is referenced in terms of their scale and scope.
For instance, Paul Krugman, a Nobel Laureate scholar, stated to Bloomberg that” we’re actually talking about taxes on a level that we’ve never seen,” adding that” we’re talking about a reversal of actually 90 years of US plan.”
The Smoot-Hawley taxes were originally intended to support the greatly obliged US agricultural field at the end of the 1920s and shield them from foreign rivals, which are both well-known themes in the anti-free-trade speech being smuggled out by Trump supporters today.
The introduction of the Great Depression had generated common, albeit not general, demands for security from imports, and Smoot-Hawley increased now considerable tariffs on international goods. Members of Congress were keen to protect their constituents ‘ industries by trading votes in exchange for assistance.
Although, at the time, more than , 1, 000 economics implored , President Herbert Hoover to reject Smoot-Hawley, the act was signed into law. On 20, 000 or consequently different types of imported goods, income amounted to nearly 40 % as a result of the resulting price action.
The culmination resulted in a dramatic decrease in US trade with other nations, especially those that retaliated, which is now widely acknowledged to have significantly worsened the Great Depression. According to one estimate, the sum of US imports plummeted by almost half.
What’s more, the consequences were felt worldwide. Around half of the 25 % decline in global business is thought to have been caused by protectionism, which in turn contributed to the development of the economic factors that led to the second world war.
The impact on Capitol Hill was significant, as well: due to the optics of the tax act’s vote-trading, Congress delegated power of business plan to the leader just four years later because the behavior was viewed as being so careless.
All of this was set against the landscape of American political protectionism in the 1930s, which is similar to many of Trump’s present attempts to veer away from or even harm multilateral institutions.
For instance, the US previously joined the United States despite receiving the Nobel Peace Prize in 1919 for his contributions to founding the League of Nations, a precursor of the United Nations.
In this time, the phrase” America First” was also frequently used to refer to a target on local legislation and high taxes.
Fast forward to the day.
Trump has stated that his levies will” produce some problems,” but that they are “worth the amount that must be paid.” Trump’s taxes may increase fees for the common US home by more than US$ 1,200 annually, according to new estimates from the non-partisan Peterson Institute for International Economics.
When actual prices start to rise, it’s still up to US voters to decide whether or not they will support Trump.
However, many Republicans on Capitol Hill have rushed to Trump’s defense. New York’s congressional representative Claudia Tenney expressed gratitude to the United States for “projecting strength for once on the world stage.”
Senator Eric Schmitt of Missouri argued that tariffs were” not a surprise,” pointing out that Trump had campaigned tirelessly for “enhancing our standing in the world.”
Senator Mitch McConnell of Kentucky, who described the tariffs as a “bad idea,” was perhaps the Republican’s most severe rebuke.
According to public opinion data, tariffs are fraught with controversy, with partisanship influencing both general opinions of tariffs and those of specific national targets.
According to a January 2025 Harvard CAPS/Harris poll, 52 % of Americans overall approve of placing new tariffs on China, with 74 % of Republicans in favor, but just 34 % of Democrats.
Support is more modest for imposing tariffs on America’s neighbors. Only 40 % of voters think tariffs on Canada and Mexico are a good idea, including 59 % of Republicans and 24 % of Democrats.
Tariffs rank low on a list of national priorities. Only 3 % of Americans believe that Trump should prioritize tariffs on Mexico and Canada, while only 11 % view China as top priority.
a potential for a more extensive trade war
What seems clear is that Trump’s proposed tariffs against Canada, Mexico, and China could be just the opening salvos in a broader tit-for-tat that may extend to Europe, and beyond.
The political challenge for Trump is to maintain what is increasingly looking like a fragile coalition at home, balancing the needs of hardline Maga supporters who oppose free trade and tech titans who believe tariffs are stumbling down crucial supply chains, especially in Asia.
After Trump’s election, former adviser and populist nationalist Steve Bannon warned that America would no longer be “abused” by “unbalanced trade deals”. ” Yes, tariffs are coming”, he said. You will have to pay to enter the US market. It is no longer free, the free market is over”.
Meanwhile, Silicon Valley has been mostly silent on the tariffs. Tech moguls have been assured that the tariffs are about leverage and will be eliminated soon enough, despite doubtlessly trying to win their favor for tariff exemptions or total tariff reductions.
Trump is showing that tariffs are a significant component of his” America First” foreign policy, a kind of belligerent unilateralism that treats allies and adversaries alike as pieces that can be moved around a chessboard.
Under Trump, the” art of the deal” means throwing America’s weight around as the world’s economic superpower, and waiting for the leaders of other nations to fold. His resolve may depend on whether American voters will bear the economic costs associated with his plans.
Trump might believe that the word “tariff” is a beautiful one at this time. However, its economic shadow might soon appear gloomy if even a hint of the 1930s is repeated.
Michael Plouffe is a lecturer in international political economy at UCL, and Thomas Gift is associate professor and director of the Center on US Politics.
This article was republished from The Conversation under a Creative Commons license. Read the original article.