Economists worldwide do not understand Trump’s customs policy and warn of the consequences. Memories of the global economic crisis of the 1930s become awake. Where are parallels, where differences?
The Great Depression, The Great Depression – this is the name of the severe economic crisis in the United States, which began on October 24, 1929 on “Black Thursday” with an unprecedented stock market crash. She paralyzed the entire global economy during the 1930s.
The day after US President Donald Trump was imposed on almost all important trading partners at an unexpected height, is also a Thursday. The long -time general director of the world trade organization, Roberto Azevdo, warned in conversation with the English BBC of a similar scenario as it was then.
“Remonizing what happened in the 1930s when the United States had raised the tariffs with the Smoot Hewley College Act and then the other countries revenge with counterpart?
Even then, the United States imposed high tariffs
History is said to be repeated, but certain parallels to the 1930s also sees Carsten Brzeski, chief economist Europe of the Dutch Ing Bank. The 1930s were not only shaped by economically difficult times, but also by protectionism, of tariffs, said Brzeski to the ARD finance editor.
“And even then the Americans introduced the tariffs. They led the other countries to react – with countermeasures.” As a result, exports and imports, indeed the entire world trade, have shrunk, said Brzeski. “Whole nations suffered from this. And ultimately we know how the 1930s ended.”
The central bank was caught in the gold standard at the time
The chief economist of Commerzbank, Jörg Krämer, is more careful when it comes to a parallel to the 1930s. Even if the scope of the tariffs remember at the time, the economic situation is completely different today. “The tariffs did not trigger the depression of the 1930s, but at most tightened. The actual problem was a huge burst speculation bubble on Wall Street.” At that time the central bank could not react correctly because it was caught in the gold standard and could not provide new liquidity. That is another situation today, says Krämer.
The gold standard has now been abolished; This means that the central banks can create new money without having to deposit the money supply in physical gold. This gives the central banks a greater freedom to intervene in the event of an economic crisis – for example by the purchase of government bonds, but this in turn would increase the public debt.
America cuts into your own meat
Another difference to the USA at that time: The 1930s were dominated by mass unemployment and social misery. Commerzbank economist Krämer is currently there in the United States. Nevertheless, he warns that America cuts into his own meat with the tariffs. “Because it sometimes withdraws from the international division of labor, which means that goods in the USA have to be produced that are simply more expensive in America. And in the end the American citizens, consumers, will pay the colliery.”
And that should also have an impact on the global economy. Because when American consumers hold back, it hits exporters worldwide. Where should all end? Even well -known economists such as the former chief economist of the International Monetary Fund, Ken Rogoff, are perplexed.
