Renowned economist Steve Hanke has raised concerns about the impact of U.S. President Donald Trump's tariffs, drawing a historical parallel between the current economic climate and the early 1930s. Hanke went as far as invoking the Smoot-Hawley Tariff Act from that era and condemning it as "the stupidest thing I've ever seen in my life."

The Smoot-Hawley Tariff Act of 1930, signed into law by President Herbert Hoover, imposed steep tariffs on thousands of imported goods, leading to a global trade war and exacerbating the Great Depression. Many economists and historians believe that the tariffs worsened the economic downturn by reducing international trade and causing retaliatory measures from other countries.

Hanke, a Professor of Applied Economics at Johns Hopkins University and a Senior Fellow at the Cato Institute, has been a vocal critic of protectionist policies like tariffs. He warned that Trump's trade levies could potentially lead to a market freefall akin to the one experienced in the 1930s. By restricting imports and increasing the cost of goods for consumers, tariffs have the potential to disrupt supply chains, increase prices, and dampen economic growth.

The economist's comments come at a time of heightened trade tensions between the United States and its key trading partners, particularly China. The Trump administration has implemented tariffs on billions of dollars' worth of Chinese goods in an effort to address what it sees as unfair trade practices. China has retaliated with its own tariffs on U.S. products, leading to a tit-for-tat escalation that has raised concerns about a full-blown trade war.

Hanke's warning about the potential consequences of tariffs echoes the sentiments of many economists and policymakers who fear that protectionist measures could harm global economic growth. The interconnected nature of the modern economy means that disruptions in one country's trade policies can have far-reaching consequences for the rest of the world.

In response to Hanke's comments, supporters of Trump's trade policies argue that tariffs are necessary to protect American industries and jobs from unfair competition. They believe that by imposing tariffs on imports, the administration can level the playing field and create a more favorable environment for domestic producers.

As the debate over tariffs and trade policy continues, economists like Steve Hanke serve as important voices in assessing the potential risks and benefits of protectionist measures. By drawing parallels to historical events like the Smoot-Hawley Tariff Act, Hanke reminds us of the potential dangers of policies that restrict international trade and

Source: https://news.bitcoin.com/tariff-tsunami-economist-steve-hanke-predicts-rough-times-for-us-economy/