Exile Economics: If Globalisation Fails
11 days ago
- #protectionism
- #economic-history
- #trade-policy
- Donald Trump's admiration for tariffs contrasts with their historical use as modest revenue tools, not protective measures.
- Ancient and medieval tariffs were low (1-5%) and not designed to block trade, unlike modern protectionist policies.
- Classical thinkers like Aristotle and Plato viewed trade skeptically, favoring self-sufficiency over commercial society.
- Pericles advocated for open trade but also restricted foreign-born Athenians, reflecting a tension between openness and protectionism.
- Herbert Hoover's 1932 tariff policies mirror Trump's, with economists then and now opposing such measures.
- Protectionism's roots trace back to early modern Europe, tied to nationalism, colonialism, and economic control.
- Mercantilism often led to cronyism, with governments favoring connected entrepreneurs over fair trade practices.
- British protectionism, including high tariffs and trade bans, fueled colonial resentment and economic disparities.
- Alexander Hamilton is credited as a key architect of American protectionism, promoting tariffs and industrial espionage.
- Tariffs have long divided U.S. politics, contributing to sectional conflicts like the Nullification Crisis and Civil War.
- Trump's tariffs, defended by Robert Lighthizer, have raised costs for consumers and failed to revive industries like steel.
- Global supply chains complicate tariff wars, with unintended consequences for industries like soy and semiconductors.
- Historical evidence shows free trade periods (1945-1993) boosted prosperity, while protectionism often led to economic strife.
- Efforts to reshore industries like chip manufacturing face skepticism and high costs, with doubts about their feasibility.
- While tariffs can protect niche industries, broad protectionist policies risk economic inefficiency and global tensions.