.. The Trump foreign economic plan most closely resembles President Herbert Hoover’s “mercantilist” approach, which tried to deal with the 1929 crash of the U.S. economy by protecting U.S. industry from foreign competition (and Mexican immigrants). The Smoot-Hawley Act of 1930 dramatically increased U.S. tariffs on imports, thereby hurting America’s trade partners. Those countries, especially the European ones, responded with trade tariffs of their own. The resulting trade war worsened economic problems, produced the Great Depression, and paved the way for Nazis in Germany. If Trump’s “close the borders” approach led to trade wars with China and others that were even half as nasty as those of the 1930s, the world would be immeasurably worse off.
.. Neoliberalism has arguably produced the conditions that are leading to its own eclipse at the hands of Trump. This suggests that it creates the conditions for its own demise, as the political and economic theorist Karl Polanyi suggested in the 1940s.
.. Equally, it is likely to lead to retaliation from other countries, and very strong opposition from multinational firms, who have often supported the Republican party in the past. If Trump and the people around him get his way, America is about to launch a vast new experiment in economic policy, with highly uncertain consequences for the US economy and the world.
