{"id":3683,"date":"2026-07-21T16:41:44","date_gmt":"2026-07-21T16:41:44","guid":{"rendered":"https:\/\/nextaddressamerica.com\/?p=3683"},"modified":"2026-07-21T16:41:44","modified_gmt":"2026-07-21T16:41:44","slug":"trumps-latest-temper-tantrum-sets-us-on-path-to-great-depression-nobel-economist","status":"publish","type":"post","link":"https:\/\/nextaddressamerica.com\/?p=3683","title":{"rendered":"Trump’s latest ‘temper tantrum’ sets US on path to Great Depression: Nobel economist"},"content":{"rendered":"
\n

On Monday, President Donald Trump announced that the U.S. would impose a 50 percent tariff against Canada in a move that Nobel Prize-winning economist Paul Krugman<\/u> notes is not only \u201calmost surely illegal,\u201d but is the same \u201cterrible mistake\u201d that pushed the U.S. into the Great Depression. <\/p>\n

Read more Trump fires warning shot at Canada: \u2018They need us to survive\u2019<\/a><\/p>\n

\u201cYesterday,\u201d writes Krugman<\/u>, \u201cthe Trump administration invoked an obscure and never-before-used provision of Smoot-Hawley \u2014 Section 338 \u2014 to impose 50 percent tariffs on a wide range of Canadian<\/u> goods.\u201d Trump\u2019s asserted reasoning for the tariffs involves accusations that Canada is discriminating against U.S. products, but as Krugman notes, the timing is suspicious, as just days earlier, the president had lashed out at Canada because smoke from its wildfires had drifted south of the border.<\/p>\n

\u2018Whatever the real motivation for these new tariffs, they are almost surely illegal,\u201d asserts Krugman. \u201cThey are definitely a violation of the U.S.-Mexico-Canada trade agreement, a revision of NAFTA negotiated and signed by Trump himself during his first term. Indeed, the White House fact sheet explicitly states that the new tariffs will be imposed \u2018regardless of whether a good originates under the U.S.-Mexico-Canada Agreement (USMCA).\u2019 So these latest actions confirm what most people around the world, from the European Commission to Iran\u2019s Islamic Revolutionary Guard, have already figured out: a deal with Donald Trump lasts only until he feels like breaking it.\u201d<\/p>\n

Krugman argues that \u201cthis really is a temper tantrum, in the sense that there\u2019s no strategy here. The new tariffs will hurt American consumers, and nobody expects them to extract any concessions from Canadians who are only getting more outraged at the United States.\u201d<\/p>\n

And Krugman isn\u2019t guessing, but basing his assessment on historical evidence. As he writes, \u201cThe Trade Act of 1930, generally known as the Smoot-Hawley tariff, lost its standing as the worst trade policy action in US history when Donald Trump imposed his \u2018Liberation Day\u2019 tariffs in April 2025. But Smoot-Hawley was widely recognized as a terrible mistake soon after its passage, as it provoked widespread retaliation and contributed to the downward spiral of world trade that accompanied and reinforced the Great Depression.\u201d<\/p>\n

Read more Senator blasts GOP for killing IVF for soldiers after Trump said he\u2019d make it free<\/a><\/p>\n

In fact, the Smoot-Hawley \u201cstupidity\u201d was so widely recognized as harmful that it \u201cled to the 1934 Reciprocal Trade Agreements Act, under which the US began negotiating trade deals \u2014 we\u2019ll reduce our tariffs if you reduce yours \u2014 that helped pave the way for the great recovery of world trade and the global economy as a whole in the decades that followed World War II.\u201d But while everyone else understood the failures of Smoot-Hawley, Trump and his allies have resurrected the long-defunct approach. <\/p>\n

What\u2019s more, argues Krugman, it degrades the U.S. relationship with vital partners. As he writes, \u201cCanada should be, and used to be, America\u2019s greatest friend in the world. We share essential political and moral values with our northern neighbor. For the most part we even share a common language, eh? And Canadians viewed us very favorably until Trump began his tariffs and threats. Now we\u2019re viewed less favorably than China.\u201d<\/p>\n

Based on all this, Krugman\u2019s conclusion is grim: \u201cI don\u2019t see a golden age. I see an America that has become an ineffectual bully, sicker, poorer<\/u>, and riven by political extremism, with no friends anywhere in the world.\u201d<\/p>\n

Read more Ex-Trump official explains the real reason Trump is fine with a \u2018forever war\u2019<\/a><\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

On Monday, President Donald Trump announced that the U.S. would impose a 50 percent tariff against Canada in a move that Nobel Prize-winning economist Paul Krugman notes is not only \u201calmost surely illegal,\u201d but is the same \u201cterrible mistake\u201d that pushed the U.S. into the Great Depression. \u201cYesterday…<\/p>\n","protected":false},"author":1,"featured_media":3116,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[],"class_list":["post-3683","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news"],"yoast_head":"\nTrump's latest 'temper tantrum' sets US on path to Great Depression: Nobel economist - Next Address America<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/nextaddressamerica.com\/?p=3683\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Trump's latest 'temper tantrum' sets US on path to Great Depression: Nobel economist - 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