Former U.S. Treasury Secretary Lawrence Summers has sharply criticized the current U.S. tariff policy, calling it one of the most harmful economic measures since World War II.
Critique of Tariff Policy
Lawrence Summers emphasized that tariffs in the U.S. have increased tenfold since 2018, leading to significant risks for the economy. He stated, 'The current tariff levels are more than ten times higher than those implemented when the trade war began in 2018, and claims of positive effects from tariffs are fundamentally fraudulent.'
Historical Tariff Comparisons
Summers compared today's tariff policy to the Smoot-Hawley Tariffs of 1930, which exacerbated the Great Depression. He noted that such measures have historically disrupted global trade dynamics and contributed to economic downturns.
Expert Reactions
Economist Paul Krugman labeled the current tariff policy as 'full-on crazy', noting a lack of justification. Financial markets reacted with volatility to tariff announcements, reflecting investor nervousness regarding the sustainability of current policies.
Lawrence Summers' critique highlights the importance of a careful approach to tariff policy in light of potential economic risks, including possible recessions and job losses.
