American customs duties could break their record in the 1930s – Liberation

If the customs tariffs presented Wednesday April 2 by Trump On the occasion of the singular « Liberation Day » are implemented as is the weighted average of American customs duties would exceed 25 %, a record more than hundred years old. Since 1918, this amount has never been reached. The previous record dates from the 1930s and the establishment by Republican President Herbert Hoover of the Smoot-Hawley Tariff Act, who, in full recession, propelled the rates upwards (the average rate reaching 19.8 % in 1933), while practicing in the country an austerity policy. As a result, the countries have replied after the other, world trade has contracted, and the recession has developed. It was only when the Roosevelt Democrat arrived as the presidency that the government has retroped. Agreements have been renegotiated and the reciprocal Tariff Act helped to unravel the measures.

A 25 % rate would represent more than ten times the rate in force at the start of the year, which was 2.42 %. It would consist, explains the economist Paul Krugmanto burn all the rules and negotiation processes patiently implemented since Roosevelt in 1934. The economist also points to the « stupidity » From the government team that has produced an apparently complex equation to justify the methodology the prices, but whose terms, written in Greek letters to give the appearance of scientificity, cancel. This results in a simple division between the commercial balance and the imports of each country. The method, according to him, resembles that « of a student who has not read the texts and who tries to bullshiter to take an examination». Or to a response that Chatgpt would make about a pricing policy.