Trump’s tariff plans could send the US back to an era of economic shocks

“Overreliance on tariffs helped foster an era of economic shocks,” he said, outlining a full timeline of policies.

His comments contradict Trump’s perspective, as the former president frequently touted tariffs as a way to solve America’s economic problems.

If elected again in November, he has pledged to implement a universal 10% trade tax on virtually all US imports, though Chinese goods would face rates of up to 60%. Trump has also offered tariffs as an alternative to the US income tax.

Weisman said this is not an untested approach. Indeed, tariffs were the primary source of federal revenue until 1913, when the 16th Amendment gave Congress the ability to levy an income tax.

And there are good reasons for the United States to have made the change, he added.

“A generalized tariff policy would not lead us to a prosperous future but to a reactionary past that stopped working in the 19th century, where it nearly bankrupted the government, aggravated class conflict, caused instability and favored the rich over everyone else,” Weisman wrote.

For example, one of the main criticisms of Trump’s idea of ​​revenue replacement is that tariffs simply can’t produce that much revenue, something that was demonstrated by the Civil War, he noted. During the conflict, insufficient tariff revenue threatened a fiscal crisis, leading Congress to pass America’s first, albeit temporary, income tax.

Although World War I once again highlighted the shortcomings of relying on tariffs, Weisman cited that the United States re-adopted them in 1930. According to him, wide-ranging trade barriers were seen as an effective shield for domestic industries and agriculture.

“Instead, they fueled a catastrophic global trade war, strangled trade, unleashed competitive currency devaluations and intensified a global depression that contributed to the rise of Nazism and world war,” he summed up.

Trump also argues that protectionism is best for American workers and farmers, but Weisman sees the benefits as marginal at best.

He gave an example: While tariffs may reduce foreign competition in the steel industry, domestic manufacturers also rely on steel imports, and when trade barriers rise, access to those materials can decrease.

Weisman also noted that Trump’s perception that tariffs are a panacea for trade imbalances is wrong, a point Trump’s recent history demonstrates.

When his previous administration used tariffs to try to reduce the trade deficit with China, it had to pay $23 billion to bail out farmers when Beijing retaliated, he said.