Economist Podcasts
Import-extort: what to make of Donald Trump’s titanic tariffs
Apr 3, 2025
Join Simon Rabinovitch, US economics editor for The Economist, and Douglas Irwin, economics professor at Dartmouth, as they dissect Donald Trump's sweeping tariff changes. They delve into the chaotic decision-making behind these trade policies and their historical context, drawing parallels to past protectionist measures like the Smoot-Hawley Act. Expect insights into the implications for global supply chains, consumer costs, and potential backlash in the face of rising economic challenges. It's a lively and provocative discussion on the future of American trade.
46:35
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Quick takeaways
- Trump's new tariffs mark a historic shift in U.S. trade policy, potentially increasing overall tariff rates to around 25%.
- The immediate economic implications include rising consumer prices and a possible reduction in U.S. GDP by 0.3% to 0.6%.
Deep dives
Trump's Tariff Announcement
The recent announcement of sweeping tariffs by President Trump marks a substantial shift in U.S. trade policy, being the most significant increase in tariffs since the early 1900s. The proposed baseline includes a 10% tariff on all imports, with reciprocal tariffs on countries with trade surpluses, effectively raising America's overall tariff rate to around 25%. Such measures have been characterized as necessary to combat the ongoing trade deficit, which Trump has labeled a national emergency affecting American security and way of life. The announcement signifies a departure from previous economic policies, aiming to reshape the trade landscape with significant implications for both domestic and global markets.
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