Tariffs, Trade Wars, and Economic Myths: Rethinking Trump’s Nod to History

On what former U.S. President Donald Trump dubbed “Liberation Day,” he launched a wave of so-called “reciprocal” tariffs targeting dozens of nations, igniting debate across political and academic circles. Trump justified the move by invoking the 1930 Smoot-Hawley Tariff Act, suggesting it could have prevented the Great Depression if it hadn’t been dismantled.
The controversial claim sparked swift backlash from economists and fact-checkers, and even sparked a pop culture resurgence, with clips from Ferris Bueller’s Day Off circulating online. In the film, the protagonist’s teacher blames the Act for deepening the Great Depression—echoing a commonly held belief. But according to historian and University of Manitoba professor George Buri, that narrative oversimplifies a complex period.
Buri challenges the notion that tariffs triggered the Depression, arguing that the economic collapse stemmed more from a lack of demand than protectionist policy. “The idea that tariffs caused the Great Depression became a convenient scapegoat in the 1980s,” Buri explained. “It aligned with the Thatcher-Reagan era’s push for free markets and minimal government intervention.”
He even offers a behind-the-scenes tidbit from Ferris Bueller’s Day Off: actor Ben Stein, who played the dull economics teacher, was himself a free-market conservative economist. His scripted monologue mirrored 1980s ideology that dismissed tariffs in favor of unregulated markets.
While the Smoot-Hawley Act is often blamed for worsening the Depression, Buri points out that its actual impact was minimal. Agricultural prices were already in freefall due to collapsing demand—wheat plummeted from $1.29 a bushel in 1928 to just 34 cents by 1933—making tariff protections largely irrelevant. It wasn’t until Franklin D. Roosevelt’s New Deal policies, which injected capital into banks and introduced social welfare programs, that the economy began to recover.
Canada, too, felt the ripple effects. Though American tariffs hurt Canadian trade, they weren’t the root cause of Canada’s economic woes. Ottawa retaliated with reciprocal tariffs, but recovery came only as American demand picked up and wartime production revived industries in the late 1930s.
Interestingly, Buri notes that the roots of modern-day Canada itself are entangled with U.S. tariff policy. When the U.S. scrapped its trade reciprocity with Britain’s colonies in 1866—after Britain supported the Confederacy during the Civil War—Canadian provinces responded by uniting. “Canada was born from economic necessity,” Buri said. “Unable to trade with Britain or the U.S., the provinces chose to trade among themselves, leading to Confederation in 1867.”
Tariffs also shaped Canadian identity under John A. Macdonald’s leadership, with protectionist policies designed to spur east-west trade and shield Canada from American dominance. Economic nationalism returned in the 1980s as U.S. corporations increasingly dominated Canadian markets, further highlighting the deep integration—and imbalance—between the two economies.
While Buri critiques Trump’s strategy, he concedes that the former president’s motives stem from real concerns. “The American economy has genuine issues,” Buri said. “This isn’t a random policy—it’s a reaction to the long-term decline of U.S. manufacturing and overreliance on Wall Street.”
Whether tariffs can restore American industry remains uncertain, but history, Buri suggests, offers more nuance than most politicians—or Hollywood scripts—would admit.