Zsolt Lengyel pointed this out on LinkedIn, and it’s worth repeating: history has already shown us what happens when a country tries to strong-arm its trading partners with tariffs. Yet, here we are again—this time, the U.S. is flexing on Canada with trade barriers. It’s economic illiteracy mixed with a touch of arrogance. What could possibly go wrong?
Let’s take a quick history lesson. Here’s what he wrote.
Back in 1930, President Herbert Hoover signed the Smoot-Hawley Tariff Act, a disastrous move that imposed steep tariffs—ranging from 40% to 48%—on over 20,000 imported goods. The goal? Protect American farmers and manufacturers during the Great Depression. The reality? A global economic meltdown.
Countries retaliated. Canada, Europe, and others hit back with their own tariffs, slashing demand for U.S. goods. Global trade collapsed by nearly 65% between 1929 and 1934, and the U.S. economy paid the price. Farmers, who relied on exports, were devastated. Unemployment skyrocketed from 8% to 25% by 1933. The protectionist policies that were meant to “save” American jobs ended up making things worse—much worse.
Fast-forward to today. The U.S. is once again slapping tariffs on its closest trading partner. Have they learned nothing? If history is any guide, punishing Canada with trade barriers won’t make America stronger—it’ll only backfire. Protectionism may sound good in political speeches, but in reality, it wrecks economies. Just ask the people who lived through the Great Depression. Tariffs don’t protect—they destroy.
Image—Canadian Chamber of Commerce
