I'm working on a full-length primer on tariffs for Sunday, but this morning's jobs report shocker needs a comment. It's highly likely that what we're seeing is the effect of Trump's tariffs — or more precisely the uncertainty that his erratic tariff policy has created. Contrary to myth, tariffs don't necessarily cause high unemployment.
Contrary to myth, tariffs don't necessarily cause high unemployment. They make the economy less efficient and poorer, but don't necessarily reduce the total number of jobs. For example, Britain in the 1950s had high tariffs and import controls, but also full employment.
For example, Britain in the 1950s had high tariffs and import controls, but also full employment. The claim that Smoot-Hawley caused the Great Depression is a myth, one fostered in part by anti-Keynesians who didn't want to admit that the problem was inadequate demand and the answer fiscal stimulus.