---
title: "What is Trump thinking? Just tariffs."
type: "Topics"
locale: "en"
url: "https://longbridge.com/en/topics/28790771.md"
description: "I don't understand him economically, but what about from a historical perspective? My discussion will revolve around two core historical cases: The protectionist policies of the United States in the 20th century → The outbreak of the Great Depression. Excessive protectionism like the Smoot-Hawley Tariff Act triggered a global trade war and exacerbated the Great Depression. The free trade policies of Britain in the 19th century → The decline of the empire. Implementing free trade led to the loss of industrial advantage and replacement by the United States. Overcapacity is the core issue—whether through openness or protectionism, if overcapacity cannot be absorbed, it will lead to crisis. The protectionist policies of the United States in the 20th century, 100 years ago, the Great Depression in the U.S...."
datetime: "2025-04-09T12:37:07.000Z"
locales:
  - [en](https://longbridge.com/en/topics/28790771.md)
  - [zh-CN](https://longbridge.com/zh-CN/topics/28790771.md)
  - [zh-HK](https://longbridge.com/zh-HK/topics/28790771.md)
author: "[奇迹的交易员cola](https://longbridge.com/en/profiles/10743314.md)"
---

# What is Trump thinking? Just tariffs.

I don't understand him economically, but what about from a historical perspective?

My argument will revolve around two key historical cases:

20th-century U.S. protectionist policies → The Great Depression. Excessive protectionism like the Smoot-Hawley Tariff Act triggered global trade wars and worsened the Great Depression.

19th-century British free trade policies → Imperial decline. Advocating free trade led to the loss of industrial dominance and replacement by the U.S.

Overcapacity is the core issue—whether through openness or protectionism, failure to absorb excess capacity leads to crisis.

### **20th-century U.S. Protectionist Policies**

100 years ago, the U.S. faced the Great Depression. In 1900, the Smoot-Hawley Tariff Act raised tariffs on over 20,000 imported goods to historic highs. After its passage, many countries retaliated with tariffs, causing U.S. imports and exports to drop by 67% during the Great Depression.

The 1920s, the Roaring Twenties. Big cities were decadent, while marginal urban and rural areas imploded. Why? Four words: overcapacity. Before the 1920s, Europe was at war, and the U.S. supplied industrial and agricultural goods. When Europe resumed production, the U.S., as the world’s factory, kept leveraging and expanding—once you start, you can’t stop. Prices for industrial and agricultural goods plummeted, e.g., agricultural income fell from $14.5 billion in 1919 to $8.1 billion in 1921. By 1929, the Great Depression hit.

Thus, the U.S. pinned its hopes on unrealistic domestic demand and doubled down on protectionism. U.S. exports dropped from $2.341 billion in 1929 to $784 million in 1932. Global trade fell by 60% from 1929 to 1933. Rising prices for daily goods and public anger erupted in 1932, ousting Republican Hoover and ushering in Democrat Roosevelt to repair the global system.

### **19th-century British Free Trade Policies**

In 1860, Britain and France championed free trade. From 1867 to 1900, U.S. industrial output, like steel, grew over 20-fold. Openness allowed the U.S. to replace Britain and France as the dumping nation; protectionism would have caused America’s overcapacity to implode. Britain lost an empire, partly due to openness and free trade.

In 1846, Britain repealed the Corn Laws, and in 1860, signed the Cobden-Chevalier Treaty, promoting free trade to monopolize global markets with industrial superiority. Britain unilaterally opened to the world, but its free trade clashed with others’ protectionism, eroding its "first-mover advantage." Meanwhile, the U.S. industrialized under protectionism.

Of course, the U.S. Great Depression was mainly caused by credit bubbles + overcapacity, but the tariff act was the final catalyst. Post-war European recovery reduced demand for U.S. agricultural and industrial goods, while America’s cutthroat industrial system forced overproduction.

Dumping nations need to offload excess capacity abroad. Whether Trump’s logic is intentional or not, he’s sealing the release valve, causing localized implosions. Historically, he might not care about short-term economics—assuming his cabinet even grasps this history.

Just my two cents—who knows?

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## Comments (91)

- **索螺丝 · 2025-05-25T00:33:59.000Z · 👍 1**: No matter what, it's still out of reach
- **Lucky2026 · 2025-05-23T23:34:04.000Z**: Just say what to buy and what to sell😂, Longbridge influencer is indeed amazing
- **Ngshueyong · 2025-05-21T10:53:48.000Z · 👍 1**: Got on board at 295, is half position too early?
- **傲娇的大公鸡 · 2025-05-16T17:14:16.000Z · 👍 1**: Can we connect on WeChat? I'd like to ask for some professional advice. Many thanks!
  - **奇迹的交易员cola** (2025-05-16T17:16:45.000Z): Don't add random people, bro, and you shouldn't either. There are many scammers out there, so stay vigilant. If you have any questions, just ask directly in the community or consult the stock 
  - **傲娇的大公鸡** (2025-05-16T17:18:34.000Z): Got it. I lost over 1 million in UNITEDHEALTH recently and had to cut losses. Any advice on how to recover? I see everyone is trading options? How to effectively maximize profits? Thanks
  - **奇迹的交易员cola** (2025-05-16T17:20:51.000Z): Today $Unitedhealth(UNH.US) is back 🤦 Newbies to options should stay away, go to Longbridge to exchange for options courses first. If you buy stocks later and the fundamentals are solid, just hold on
- **奇迹的交易员cola · 2025-05-08T16:45:15.000Z · 👍 1**: Reading "The Origins of Political Order",I noticed a problem in the discussions on Longbridge,too many stances, too few principles.Understanding motives doesn't mean agreeing with them,moral and interest standards also differ,if we want to discuss, we must first clarify the direction.The rul
- **奇迹的交易员cola · 2025-04-21T11:05:19.000Z · 👍 2**: If I were Trump🧐 opening the ledger.Current status of the US dollar:- Manufacturing sector has not declined- Share of global GDP is decreasing- Current account deficit- Burden of global security affairs- Expanding fiscal deficit- Overvalued US dollar- US dollar deviates from international trade equ
  - **杭州蛋炒饭** (2025-04-21T11:07:29.000Z): Actually, what you said is too optimistic. All of this would only be effective if there is no retaliation from major trading partners. Otherwise, it's just too idealistic.
  - **奇迹的交易员cola** (2025-04-21T11:08:08.000Z): Yes.
  - **两江总督** (2025-04-21T11:11:56.000Z): Is four years enough to complete it, or maybe even less than four years? What about the midterm elections?
- **奇迹的交易员cola · 2025-04-21T10:51:28.000Z · 👍 1**: History has reached the third step.
  - **精神科主任普京** (2025-04-21T12:30:50.000Z): Hmph, I won't let this go smoothly
- **点金成石 · 2025-04-10T15:37:57.000Z · 👍 1**: The United States also has a history, and its industrialization history is longer than ours.
  - **奇迹的交易员cola** (2025-04-10T15:40:04.000Z): So history has already given the answer. The cruelty of reality is not something everyone can accept.
- **林金秋 · 2025-04-10T15:08:03.000Z · 👍 3**: Love this kind of reliable article～second to none and won't accept any rebuttal～～～
- **庚申49 · 2025-04-10T15:04:12.000Z · 👍 2**: Looking around the world, who has excess capacity? It goes without saying! Misattribution😂
- **hongyuqin · 2025-04-10T07:39:50.000Z · 👍 2**: Trump is essentially still a businessman, don't think he will stick to one path to the end.
- **新用户DdIRnS · 2025-04-10T06:50:15.000Z · 👍 1**: Feeling a bit sad💔
- **跳跳阳 · 2025-04-10T03:50:57.000Z · 👍 1**: Really changed the name 😆
- **权坊探花郎 · 2025-04-10T03:20:48.000Z · 👍 1**: You'd better be talking about the United States! 😤
- **好运中心 · 2025-04-09T21:33:30.000Z · 👍 1**: There is only overcapacity in some industries
  - **奇迹的交易员cola** (2025-04-10T00:47:15.000Z): What is the proportion of this industry...
- **来到美股当韭菜 · 2025-04-09T19:23:16.000Z · 👍 1**: Enhanced value
- **Vanilla Cola · 2025-04-09T18:51:48.000Z · 👍 3**: The production capacity explosion hadn't even ignited yet, when some genius decided to add fuel to the fire with supply-side reforms.The more I see of this world, the more speechless I become.
- **奇迹的交易员cola · 2025-04-09T18:41:56.000Z · 👍 2**: The article was posted before the market opened...
  - **美谷必胜** (2025-04-09T22:32:00.000Z): 。。。Why didn't see anything
  - **想赚点零花钱** (2025-04-10T01:09:31.000Z): Didn't see
- **Oakley · 2025-04-09T15:54:52.000Z · 👍 1**: The US wants to shift domestic conflicts and profit from war by forcing other countries into submission through military means - isn't this just bandit behavior?
  - **奇迹的交易员cola** (2025-04-09T15:58:11.000Z): Dumping countries need to transfer...
  - **Oakley** (2025-04-09T17:51:20.000Z): Want to trigger a regional economic collapse for harvesting purposes, isn't that just like bandits raiding a village? After trade is blown up, they leverage their strong military power to deliver a do
  - **杭州蛋炒饭** (2025-04-10T15:13:26.000Z): I don't think it will implode, given the system in place. However, after decoupling, a military reunification is highly likely. It will definitely hurt, but we must reclaim the land. After all, talks 
- **奇迹的交易员cola · 2025-04-09T15:39:19.000Z · 👍 1**: Originally wrote over ten thousand words, but I'm afraid no one would read such a long post 🤦@普京的交易员@金将军的交易员
  - **金将军的交易员** (2025-04-09T15:40:08.000Z): I see, I'll help you summarize it in 120 words after reading.
  - **不卖我就不亏** (2025-04-10T01:09:44.000Z): Don't miss this wave, a must-see for Longbridge community members