Regardless of what one thinks of the Trump tariff strategy, we still think it is important to set the historical record straight.

We hear economists on the left and the right argue that the Smoot-Hawley Tariff of 1930 did NOT cause the Great Depression. How could a tariff signed into law in March of 1930 cause a stock market crash that began in October, 1929?

This is answered by the late Jude Wanniski (who invented the term The Laffer Curve) in a classic 1977 WSJ op-ed and in greater depth in his book: The Way the World Works.

The market started to sink when Rep. Hawley of Oregon and Senator Smoot of Utah were moving their bill through Congress, with ups and downs corresponding with the bill’s prospects of passage. Then when it was signed into law by Herbert Hoover, a stock market selloff – which could otherwise have been contained – ignited into a wildfire of selling.

Yes, we know this was an era long past, and Laffer reminds us that one difference between then and now is that Smoot-Hawley was a tariff cemented into law, whereas Trump’s tariffs are by executive order and can be repealed or adjusted quickly. We hope so.