The Lesson of Smoot-Hawley
On the podcast: The last big American trade war was in 1930. It ended badly for everyone.
A version of this episode was first released on Aug 3.
If U.S. President Donald Trump doesn’t know about the Smoot-Hawley Tariff Act, then this episode is for him. The legislation, enacted in 1930, introduced tariffs on 900 products and launched the United States headlong into a trade war with Canada, the United Kingdom, and other countries. Already in the throes of the Great Depression, the retaliation made it worse. It took the United States more than a decade to recover.
Douglas Irwin, an economist who has written a book about Smoot-Hawley, joins us on the podcast this week to talk about tariffs, trade wars, and that iconic scene in the movie Ferris Bueller’s Day Off. Anyone? Anyone?