A Historical Analysis of US Tariffs and Trade: Implications of the "Liberation Day" Tariff Announcements

Written By Andrew Dunn

Executive Summary

  • Historical Importance of Tariffs: Tariffs have been central to US economic policy, shifting from revenue generation in the early republic to protectionism during industrialization, and later to trade liberalization in the 20th century.

  • Key Historical Shifts:

    • Early tariffs (e.g., Tariff of 1789) funded the government and protected U.S. industries.

    • Protectionist policies expanded post-Civil War (e.g., Morrill Tariff, McKinley Tariff) to shield domestic industries but strained regional economies.

    • The Smoot-Hawley Tariff (1930), aiming to protect jobs during the Great Depression, backfired, deepening economic woes and collapsing global trade.

    • Trade liberalization (e.g., GATT, NAFTA) in the mid-20th century reduced barriers, promoting global commerce but also contributing to job losses in sectors like manufacturing.

  • Recent Trends:

    • The Trump administration reignited protectionism with the "Liberation Day" tariffs (2025). Sweeping tariffs up to 54% were imposed to address trade imbalances and revive U.S. manufacturing.

    • Criticism surrounds these tariffs, with experts warning of retaliation, economic slowdowns, and price hikes.

  • Impact on Real Estate:

    • Residential: Tariffs on materials like lumber and steel increase construction costs, worsening the affordability crisis.

    • Commercial: Higher costs and inflation strain retail spaces and diminish consumer spending.

    • Industrial: Supply chain disruptions could shift demand patterns, with potential reshoring of manufacturing benefiting certain regions.

  • Lessons from History:

    • Protectionist measures often yield both winners (domestic manufacturers) and losers (consumers, exporters, and trade-dependent regions). Historical patterns suggest current tariffs could provoke economic friction and political tensions.

The "Liberation Day" tariffs reflect a return to protectionism but come with risks of trade wars, higher costs, and global economic instability. Key sectors like real estate are bracing for significant impacts as building costs and economic uncertainty rise. Understanding this cyclical nature of trade policy is crucial for predicting future trends.

Early Tariffs and the Foundation of US Trade Policy (Late 1700s - Early 1800s)

Tariffs, defined as taxes levied on imported goods and services, have played a central role in shaping the economic landscape of the United States since its inception. (1) Initially serving as the primary source of federal revenue, the objectives of tariff policies evolved over time to include the protection of domestic industries and, more recently, the rectification of perceived trade imbalances. (1) The recent announcement of sweeping "liberation day" tariffs by President Trump marks a significant moment in this historical trajectory, signaling a potential return to more protectionist trade policies. (3) This report aims to provide a comprehensive historical analysis of US tariffs and trade, examining the evolution of trade policies, discussing major tariff acts, analyzing the benefits and drawbacks of these policies, identifying historical winners and losers, and detailing the impact on various sectors, with a specific focus on real estate asset classes.

The early years of the United States saw tariffs primarily employed as a means of generating revenue for the fledgling federal government. (1) The Tariff of 1789, also known as the Hamilton Tariff, stands as the first major piece of legislation in this area, with the aims of not only raising revenue but also fostering the growth of domestic manufacturing and addressing the national debt. (5) This act included tonnage duties that favored American-owned ships, effectively establishing an "American navigation system" by imposing lower cargo fees compared to foreign vessels. (5) Furthermore, import duties were levied on a variety of goods, with the majority facing a 5% ad valorem fee. (5) To ensure the effective collection of these duties, Congress also established the Customs Service. (5) These tariffs quickly became the primary source of income for the federal government, accounting for over 87% of its revenue between 1789 and 1800. (5) However, even in these early years, debates emerged regarding the purpose and impact of tariffs. While Northern manufacturers generally favored protective measures, Southern planters, reliant on exports, typically desired lower tariffs to ensure cheaper consumer imports. (5) A significant point of contention arose with the Tariff of 1828, infamously known as the "Tariff of Abominations," which sparked considerable controversy and the Nullification Crisis due to its high rates that disproportionately affected the Southern economy. (5) This tariff set a 38% tax on some imported goods and 45% on certain raw materials, with the primary goal of protecting Northern industries from lower-priced imports from Britain. (7) The Southern states, heavily dependent on trade with Great Britain, not only faced higher prices for manufactured goods but also feared retaliatory tariffs on their crucial cotton exports. (7) The strong opposition in South Carolina led to threats of nullification, precipitating a major political crisis. (7) By the mid-19th century, while the need for revenue remained, the protective aspect of tariffs was increasingly emphasized as the nation's industrial base began to expand. (2) The early history of US tariffs reveals a fundamental tension between the economic interests of different regions and sectors, particularly the industrial North and the agricultural South. The Tariff of Abominations and the ensuing Nullification Crisis serve as stark reminders of how tariff policy could exacerbate sectional divisions and even threaten the stability of the nation. This historical context suggests that contemporary tariff policies could also have disparate regional and sectoral effects, potentially leading to political friction. Furthermore, the initial reliance on tariffs as the primary source of federal revenue underscores the significant role of international trade in the early American economy and the government's dependence on it. This dependence shaped the early debates surrounding tariffs, as the need for revenue often had to be balanced against the desire to protect nascent industries or ensure affordable imports. The subsequent shift away from tariffs as the primary revenue source, with the introduction of income tax, provided greater flexibility in utilizing tariffs as a tool for protection or trade negotiation. (1)

The Rise of Protectionism and Industrial Expansion (Mid-1800s - Early 1900s)

The period following the Civil War witnessed a growing emphasis on protectionism as the United States underwent rapid industrial expansion. (2) The Morrill Tariff Act of 1861, enacted during the early stages of the Civil War, significantly raised tariff rates, partly to finance the war effort but also to shield Northern industries from foreign competition. (5) This act increased duties on key industrial inputs such as iron and wool, as well as on manufactured goods like woolen products. (16) While the Northern states, with their manufacturing-based economies, generally favored this tariff, the Southern states, which were net consumers of manufactured goods, were largely opposed. (6) The late 19th century saw the implementation of some of the highest tariff rates in US history, reflecting the prevailing protectionist sentiment. (17) The McKinley Tariff Act of 1890 raised average duties on imports to nearly 50%, with the explicit goal of protecting both American agriculture and developing manufacturing industries. (5) This led to higher prices for consumers and faced considerable opposition from Democrats and agricultural groups who argued it harmed their interests. (21) Notably, the McKinley Tariff also included a provision aimed at fostering reciprocal trade by authorizing the President to reinstate tariffs on certain goods if other countries failed to lower their tariffs on US exports. (24) Following this, the Dingley Tariff Act of 1897 further increased duties to an average of 57%, marking the highest tariff rates in US history up to that point. (5) This act raised rates on a wide range of goods, including sugar, salt, tin cans, glassware, tobacco, iron, and steel. (17) While it led to a rise in the cost of living, it coincided with a period of economic prosperity partly attributed to an influx of gold. (17) The early 20th century continued to see debates over the appropriate level of tariffs. (30) The Payne-Aldrich Tariff Act of 1909, despite initial intentions to lower tariffs, resulted in only a marginal reduction and sparked anger among Progressive Republicans. (5) This act also included the introduction of a corporate income tax, signaling a gradual shift in federal revenue sources. (30) A more significant change came with the Underwood Tariff Act of 1913, which substantially lowered tariff rates from approximately 40% to 25% and reintroduced the federal income tax as a primary source of government revenue. (1) This act also placed many goods, including raw materials and agricultural products, on a duty-free list. (35) The late 19th and early 20th centuries demonstrate a strong alignment between the Republican party and protectionist tariff policies, often justified as beneficial for American industry and workers. This consistent political stance underscores the ideological significance of tariff policy during this era and its use as a tool to gain support from specific economic groups. The debates and eventual policy shifts, such as the Underwood Tariff, also reflect the evolving political landscape and the influence of varying economic philosophies. Furthermore, the McKinley Tariff's provision granting the President authority to reinstate tariffs to secure reciprocal trade indicates an early recognition of the need for international cooperation in trade policy, even within a predominantly protectionist framework. This suggests a nuanced understanding that while protecting domestic industries was a key objective, maintaining access to foreign markets for US exports was also considered important, implying that even high-tariff regimes could incorporate elements of trade negotiation.

The Interwar Years, the Great Depression, and the Shift Towards Trade Liberalization (1920s - 1940s)

The period encompassing the interwar years and the Great Depression witnessed a complex interplay of protectionist policies and their profound economic consequences. (35) Following World War I, a resurgence of protectionist sentiment emerged in the United States. (35) The Emergency Tariff of 1921 and the Fordney-McCumber Tariff of 1922 were enacted to raise tariff rates with the aim of protecting US businesses and the agricultural sector in the aftermath of the war. (5) The Fordney-McCumber Tariff increased average duties to approximately 38.5% and granted the President the authority to adjust these rates. (39) This tariff was partly intended to aid American farmers who faced increasing competition from the recovering agricultural sectors in Europe. (41) However, it also led to retaliatory tariffs from other nations and is argued by some to have negatively impacted American agriculture. (37) The Smoot-Hawley Tariff Act of 1930 stands as a particularly significant piece of legislation from this era, representing the zenith of US protectionism and is widely considered to have exacerbated the Great Depression. (1) This act raised import duties to historically high levels with the goal of protecting American businesses and farmers from foreign competition. (41) The average tariff on dutiable imports rose to 47%. (43) This move prompted widespread retaliatory tariffs from US trading partners, leading to a dramatic collapse in global trade. (41) US imports and exports plummeted by over 60% between 1929 and 1933 (44), and unemployment rates soared during this period. (44) Economists generally view the Smoot-Hawley Tariff as a major policy misstep with severe negative consequences. (42) The disastrous outcomes of the Smoot-Hawley Tariff ultimately led to a significant shift in US trade policy. (41) The Reciprocal Trade Agreements Act (RTAA) of 1934 marked a historic turning point away from protectionism. (5) This act authorized the President to negotiate bilateral trade agreements with foreign nations to reduce tariffs by up to 50%. (49) Tariff reductions negotiated with one country were automatically extended to imports from all other countries that treated US trade on a "most-favored nation" basis. (49) By 1940, the United States had effectively reversed the high tariffs of the Smoot-Hawley era through agreements made under the RTAA. (49) The interwar period serves as a stark reminder of the potential for high tariffs to initiate a detrimental cycle of retaliatory measures and economic contraction on a global scale. The Smoot-Hawley Tariff Act stands as a potent historical example of how protectionist policies, intended to shield domestic economies, can backfire and worsen economic crises by disrupting international trade and damaging global economic relationships. This historical lesson is crucial for evaluating the potential risks associated with contemporary high-tariff policies. Conversely, the passage of the Reciprocal Trade Agreements Act of 1934 represents a pivotal shift in US trade policy, acknowledging the limitations of unilateral protectionism and embracing the advantages of negotiated tariff reductions and trade liberalization. This change, largely driven by the experience of the Great Depression, laid the groundwork for the post-World War II global trading system based on cooperation and the reduction of trade barriers, signifying a fundamental evolution in the understanding of how tariffs should be employed in international economic relations.

Post-World War II Era: Building a Global Trading System (1940s - 2000s)

Following World War II, the United States played a central role in establishing a rules-based global trading system aimed at fostering economic recovery and preventing future conflicts. (1) A key component of this system was the General Agreement on Tariffs and Trade (GATT), signed in 1947 by 23 countries, including the US, with the primary objective of reducing barriers to international trade. (1) GATT's core principles included nondiscrimination, as embodied in the "most-favored nation" clause, and a focus on reducing tariffs and quotas. (1) Through successive rounds of negotiations under GATT, average tariff rates among participating countries fell dramatically from approximately 22% in 1947 to under 5% by 1994. (57) The US was a founding member of GATT and actively participated in these rounds, working to further reduce tariffs and address non-tariff barriers to trade. (49) The latter part of the 20th century also saw the rise of significant regional trade agreements. (51) The North American Free Trade Agreement (NAFTA), implemented in 1994 between the US, Canada, and Mexico, established a free-trade zone by eliminating most tariffs on goods produced within the signatory nations. (5) NAFTA's primary aim was to promote trade and investment among the three North American economies. (66) Its implementation led to a significant surge in cross-border trade and the development of complex supply chains across the region. (69) However, NAFTA also faced criticism, particularly in the US, regarding its impact on manufacturing jobs and other economic effects. (67) In 1995, the World Trade Organization (WTO) was established as the successor to GATT, with a broader mandate and stronger mechanisms for enforcing trade rules and resolving disputes. (1) The WTO aimed to further the liberalization of international trade and provide a stable framework for global commerce. (1) The United States became a member of the WTO and continued to pursue its trade policy objectives within this multilateral framework. (1) The post-World War II era clearly demonstrates a broad consensus among policymakers on the benefits of trade liberalization, leading to the creation of multilateral institutions such as GATT and the WTO, as well as regional agreements like NAFTA. This period reflects a prevailing belief that reducing trade barriers fosters economic growth, enhances efficiency, and promotes international cooperation. The substantial decline in average tariff rates under GATT and the significant expansion of global trade during this time lend credence to this view. However, while NAFTA aimed at achieving free trade and did indeed boost cross-border commerce, its implementation also coincided with a notable decline in US manufacturing jobs. This outcome sparked considerable debate about the true beneficiaries of such trade agreements and contributed to the rise of protectionist sentiments in later years. This highlights the complex and often uneven impacts of trade liberalization, where aggregate economic benefits may be accompanied by significant distributional effects across different sectors and labor markets, potentially leading to political repercussions.

The 21st Century and the Resurgence of Protectionism (2000s - Present)

The early 21st century witnessed a growing unease regarding the direction of US trade policy, with increasing concerns about persistent trade deficits, particularly with China, and the broader impact of globalization on domestic industries. (38) China's accession to the World Trade Organization in the early 2000s led to a significant expansion of trade between the two nations but also resulted in a substantial trade deficit for the United States. (38) During the Doha Round of WTO trade negotiations, the US made unsuccessful attempts to persuade advanced emerging economies, including China, to commit to lower their bound tariff rates. (1) The first Trump administration marked a notable shift in US trade policy, openly criticizing the prevailing low-tariff approach and implementing tariffs on specific goods, most notably on steel and aluminum imports, as well as on a wide range of goods imported from China. (1) As a result of these actions, the total duties paid on US imports doubled from approximately $37 billion in FY2015 to $74 billion in FY2020. (1) A significant trade war erupted with China in 2018, characterized by the imposition of tariffs on billions of dollars worth of goods by both countries, leading to retaliatory measures. (74) In April 2025, President Trump's second administration announced a new set of sweeping "reciprocal" tariffs, which he termed "liberation day" tariffs. (3) These measures included a 10% baseline tariff on imports from nearly all countries, which took effect on April 5. (3) Additionally, higher "reciprocal" tariffs, ranging from 11% to 50%, were imposed on approximately 60 countries starting on April 9. These higher rates were reportedly calculated based on the US trade deficit with each country and the administration's assessment of unfair trade practices. (3) For China, the total tariff rate reached as high as 54% when combined with previously imposed tariffs, with some estimates suggesting it could exceed 60% in certain sectors. (4) The Trump administration asserted that these tariffs were necessary to revitalize domestic manufacturing, address chronic trade imbalances, and ensure fair trade relationships with other nations. (3) Certain categories of goods were exempted from these tariffs, including copper, pharmaceuticals, semiconductors, lumber, bullion, and energy and mineral resources not available within the United States. Initially, goods compliant with the USMCA from Canada and Mexico were also exempt. (4) However, economists widely anticipated that these tariffs would lead to increased consumer prices, a reduction in US economic growth, and the likelihood of retaliatory actions from affected trading partners. (3) Concerns were also raised that the levels of these new tariffs could approach or even surpass those of the infamous Smoot-Hawley Tariff Act of 1930. (3) The international reaction to the "liberation day" tariffs was largely negative, with many countries expressing significant concern and threatening or implementing retaliatory measures against US exports. (85) The "liberation day" tariffs represent a significant shift away from the trade liberalization policies that had largely defined US trade strategy for several decades, indicating a renewed emphasis on protectionist measures under the Trump administration. This change is driven by a belief that tariffs can be an effective tool for bolstering domestic manufacturing and rectifying trade imbalances, despite historical evidence suggesting potential negative economic repercussions. The use of emergency powers under the International Emergency Economic Powers Act (IEEPA) to implement these tariffs further underscores the strong executive push behind this policy direction. Moreover, the calculation of these "reciprocal" tariffs based on the US trade deficit and perceived unfair trade practices, rather than simply mirroring existing tariff rates, introduces a novel and potentially more contentious aspect to US trade policy. While intended to create a level playing field, this approach has been criticized by many economists as being based on questionable economic principles, such as focusing on bilateral trade balances, and could lead to substantial distortions in global trade patterns and heightened trade friction.

Impact of US Tariffs on Real Estate Asset Classes

The history of US tariffs has had a tangible impact on various real estate asset classes, primarily through its influence on construction costs, trade flows, and overall economic activity. In the residential real estate sector, tariffs on essential building materials such as lumber, steel, and aluminum have historically led to increases in construction costs. (97) The Smoot-Hawley Tariff, while not directly targeting the housing market, exacerbated the Great Depression, resulting in a significant slowdown in new construction and a sharp decline in property values during the 1930s. (44) More recent tariffs, such as those imposed on Canadian softwood lumber, have caused notable price spikes, negatively affecting housing affordability. (97) Similarly, the 2018 tariffs on steel and aluminum led to increased construction costs, which were frequently passed on to homebuyers. (99) The recently announced "liberation day" tariffs are expected to further escalate the cost of imported construction materials, potentially adding thousands of dollars to the price of a new home and further straining housing affordability. (96) Furthermore, tariffs can contribute to broader inflationary pressures in the economy, which can indirectly lead to higher mortgage rates, further impacting housing affordability. (94) In the commercial real estate sector, tariffs can also increase construction costs for various types of buildings. (104) Retail spaces can be significantly affected by tariffs on imported consumer goods, potentially leading to higher retail prices, reduced consumer spending, and decreased foot traffic in shopping centers. (104) Industrial real estate, particularly warehousing and logistics facilities, is directly influenced by tariffs that impact the volume and direction of import and export flows. (69) Tariffs can cause shifts in supply chains, potentially increasing demand for industrial space in certain regions while decreasing it in others, depending on how businesses adapt to the changing trade landscape. (71) Office spaces tend to be indirectly affected by tariffs through their impact on the broader economy, such as reduced business confidence and slower economic growth. (70) The implementation of NAFTA in 1994 had a notable positive impact on US industrial real estate, spurring significant capital investment, especially along key logistics and supply chain corridors, with warehouse inventory increasing substantially since its inception. (70) While the subsequent renegotiation of NAFTA into the USMCA was expected to benefit US commercial real estate by reducing uncertainty surrounding trade, tariffs implemented outside the USMCA framework can still negatively affect the highly interconnected supply chains that developed under the original agreement. (70)

Tariff Act Name Year Enacted Key Provisions Impact on Residential Real Estate Impact on Commercial Real Estate Impact on Industrial Real Estate
Tariff of 1789 1789 Revenue generation, favored American shipping Minimal direct impact Minimal direct impact Minimal direct impact
Tariff of Abominations 1828 High protective rates, especially on raw materials Minimal direct impact, but contributed to sectional tensions Minimal direct impact, but contributed to sectional tensions Minimal direct impact, but contributed to sectional tensions
Morrill Tariff Act 1861 Increased tariff rates to fund Civil War and protect Northern industries Minimal direct impact Minimal direct impact Minimal direct impact
McKinley Tariff Act 1890 Raised average duties to nearly 50%, protectionist Minimal direct impact Minimal direct impact Minimal direct impact
Dingley Tariff Act 1897 Further increased duties to an average of 57% Minimal direct impact Minimal direct impact Minimal direct impact
Payne-Aldrich Tariff Act 1909 Slight reduction in rates, included corporate income tax Minimal direct impact Minimal direct impact Minimal direct impact
Underwood Tariff Act 1913 Significantly lowered rates, reintroduced income tax Minimal direct impact Minimal direct impact Minimal direct impact
Fordney-McCumber Tariff 1922 Increased rates to protect post-war industries and agriculture Minimal direct impact Minimal direct impact Minimal direct impact
Smoot-Hawley Tariff Act 1930 Highest tariff rates in US history, protectionist Exacerbated Great Depression, slowed construction, reduced values Exacerbated Great Depression, reduced business activity Exacerbated Great Depression, severely reduced trade and manufacturing
Reciprocal Trade Agreements Act 1934 Authorized tariff reductions through bilateral agreements Minimal direct impact Minimal direct impact Minimal direct impact
GATT 1947 Aimed to reduce tariffs and trade barriers Minimal direct impact Minimal direct impact Minimal direct impact
NAFTA 1994 Eliminated most tariffs between US, Canada, Mexico Indirectly supported housing demand through economic growth Increased retail activity, boosted demand for commercial space Significantly increased demand for warehousing and logistics
Trump Tariffs (2018-2020) 2018-2020 Tariffs on steel, aluminum, China Increased construction costs, impacted affordability Increased costs for some businesses, impacted retail Disrupted supply chains, mixed impact on manufacturing
"Liberation Day" Tariffs 2025 Broad tariffs on most imports, higher rates for some countries Expected to increase construction costs, reduce affordability Expected to increase costs for retailers, impact trade volumes Expected to cause shifts in supply chains, potential for reshoring

Winners and Losers in the History of US Tariffs

Throughout US history, tariff policies have created both winners and losers across various sectors and among different groups. Historically, domestic manufacturers in industries protected by tariffs have been primary beneficiaries, as these tariffs increased the cost of imported goods, thereby reducing foreign competition and allowing domestic producers to maintain or expand their market share. (6) In certain instances, farmers producing specific agricultural products that received tariff protection also experienced benefits. (26) In the early years of the nation, the federal government itself was a significant beneficiary of tariffs, as they served as the primary source of its revenue. (1) During the era of trade liberalization that followed World War II, export-oriented industries and consumers generally benefited from lower prices on imported goods and increased access to foreign markets. (1) More recently, domestic producers of materials like steel, aluminum, and lumber might see an uptick in demand and potentially higher prices as a result of the recent tariffs. (107) Conversely, consumers have often been negatively impacted by tariffs, as they typically face higher prices for imported goods due to the added cost of the tariff. (17) Industries that rely heavily on imported raw materials or components in their production processes can experience increased production costs as a result of tariffs. (39) Agricultural exporters can also be negatively affected when other countries retaliate with their own tariffs on US agricultural products. (20) Regions with economies heavily dependent on international trade often suffer during periods of high tariffs and trade wars due to disruptions in trade flows. (41) Historically, the Southern states in the US were negatively impacted by high tariffs that disproportionately benefited the industrial North. (5) Retailers that primarily sell imported goods may face significant challenges due to higher costs and potential shifts in consumer purchasing behavior. (95) The historical analysis reveals a consistent pattern where tariffs, while intended to provide benefits to specific domestic industries, often lead to broader negative consequences for consumers and other sectors of the economy, particularly those with strong ties to international trade. This suggests an inherent trade-off in tariff policy, where the advantages gained by a targeted group may come at the expense of higher costs and reduced competitiveness for the overall economy. The "liberation day" tariffs are likely to follow this well-established historical pattern. Furthermore, the impact of tariffs is not evenly distributed across different regions and sectors within the United States, leading to the emergence of both winners and losers based on their primary economic activities and their reliance on imports and exports. This uneven distribution of benefits and costs has historically contributed to political tensions and ongoing debates regarding the fairness and effectiveness of tariff policies, as evidenced throughout the history of the United States.

Conclusion: Historical Cycles and the Future of US Trade Policy

In conclusion, the history of US tariffs and trade policy is marked by a dynamic evolution, shifting from a primary focus on revenue generation in the early republic to periods of strong protectionism aimed at fostering domestic industrial growth, followed by a significant era of trade liberalization in the latter half of the 20th century. The recent "liberation day" tariff announcements by President Trump represent a notable resurgence of protectionist sentiment and a departure from the long-standing trend of trade liberalization. Historical precedents, particularly the experience with the Smoot-Hawley Tariff Act, suggest that such broad-based tariffs carry significant risks of triggering retaliatory measures, increasing consumer prices, and hindering overall economic growth. The anticipated effects on real estate asset classes include higher construction costs for both residential and commercial properties, potentially exacerbating the existing housing affordability crisis and impacting the feasibility of new development projects. The retail sector may face challenges due to increased costs of imported goods and potential shifts in consumer spending, while the industrial sector could see adjustments in supply chains and potentially some reshoring of manufacturing. Ultimately, the long-term consequences of the "liberation day" tariffs for the US economy and the real estate market remain uncertain and will likely depend on the responses of global trading partners and the evolving dynamics of international trade relations. The long history of US tariffs reveals a cyclical pattern, with periods of high protectionism often followed by moves towards liberalization, suggesting that the current resurgence of tariffs may not be a permanent shift but rather part of an ongoing debate about the optimal approach to trade policy. Understanding this historical cycle can provide a broader perspective on the current trade policy landscape and suggest potential future directions, including the possibility of renewed efforts towards trade liberalization depending on the outcomes of the current policies. While the Trump administration frames the "liberation day" tariffs as a way to bring back manufacturing jobs and strengthen the US economy, historical evidence, particularly the experience of the Great Depression, suggests that such broad-based tariffs carry significant risks and could potentially lead to negative consequences for the overall economy and specific sectors like real estate. This highlights the importance of considering historical lessons and the potential for unintended consequences when implementing significant changes in trade policy.

Works cited

  1. U.S. Tariff Policy: Overview - CRS Products from the Library of Congress, accessed April 7, 2025, https://crsreports.congress.gov/product/pdf/IF/IF11030

  2. U.S. Trade Policy in Historical Perspective - National Bureau of Economic Research, accessed April 7, 2025, https://www.nber.org/system/files/working_papers/w26256/w26256.pdf

  3. Trump announces sweeping new tariffs to promote US manufacturing, risking inflation and trade wars | AP News, accessed April 7, 2025, https://apnews.com/article/trump-tariffs-liberation-day-2a031b3c16120a5672a6ddd01da09933

  4. Five key takeaways from Trump's 'Liberation Day' reciprocal tariffs - Al Jazeera, accessed April 7, 2025, https://www.aljazeera.com/economy/2025/4/3/five-key-takeaways-from-trumps-liberation-day-reciprocal-tariffs

  5. List of tariff laws in the United States - Wikipedia, accessed April 7, 2025, https://en.wikipedia.org/wiki/List_of_tariff_laws_in_the_United_States

  6. South Carolina - Antebellum Tariffs - Carolana, accessed April 7, 2025, https://www.carolana.com/SC/1800s/antebellum/antebellum_tariffs.html

  7. Tariff of Abominations - Wikipedia, accessed April 7, 2025, https://en.wikipedia.org/wiki/Tariff_of_Abominations

  8. Tariff Act 4 Stat. 270 (1828) - Encyclopedia.com, accessed April 7, 2025, https://www.encyclopedia.com/politics/encyclopedias-almanacs-transcripts-and-maps/tariff-act-4-stat-270-1828

  9. Tariff of 1828 | Definition, Summary, & Nullification - Britannica, accessed April 7, 2025, https://www.britannica.com/topic/Tariff-of-1828

  10. The Tariff of Abominations - Adam Smith Institute, accessed April 7, 2025, https://www.adamsmith.org/blog/the-tariff-of-abominations

  11. Nullification Crisis | Significance, Cause, President, & States Rights - Britannica, accessed April 7, 2025, https://www.britannica.com/topic/Nullification-Crisis

  12. Nullification Crisis in South Carolina – South Carolina Digital Newspaper Program, accessed April 7, 2025, https://digital.library.sc.edu/blogs/newspaper/topic-guides/nullification-crisis-in-south-carolina/

  13. The Nullification crisis (article) - Khan Academy, accessed April 7, 2025, https://www.khanacademy.org/humanities/us-history/the-early-republic/age-of-jackson/a/the-nullification-crisis

  14. John C. Calhoun, South Carolina Exposition and Protest, 1828 | Bill of Rights Institute, accessed April 7, 2025, https://billofrightsinstitute.org/activities/john-c-calhoun-south-carolina-exposition-and-protest-1828

  15. Morrill Act (1862) | National Archives, accessed April 7, 2025, https://www.archives.gov/milestone-documents/morrill-act

  16. The Civil War Tariff - Mises Institute, accessed April 7, 2025, https://mises.org/mises-daily/civil-war-tariff

  17. Dingley Tariff | Encyclopedia.com, accessed April 7, 2025, https://www.encyclopedia.com/history/encyclopedias-almanacs-transcripts-and-maps/dingley-tariff

  18. Dingley Act - Wikipedia, accessed April 7, 2025, https://en.wikipedia.org/wiki/Dingley_Act

  19. Dingley Tariff - (US History – 1865 to Present) - Vocab, Definition, Explanations | Fiveable, accessed April 7, 2025, https://library.fiveable.me/key-terms/united-states-history-since-1865/dingley-tariff

  20. Accelerate Monthly - Tariff Turbulence | by Julian Klymochko | Mar, 2025 | Medium, accessed April 7, 2025, https://medium.com/@julian-34159/accelerate-monthly-tariff-turbulence-38d8ef458ad5

  21. McKinley Tariff Act - (AP US History) - Vocab, Definition, Explanations | Fiveable, accessed April 7, 2025, https://library.fiveable.me/key-terms/apush/mckinley-tariff-act

  22. President McKinley's Tariff Mishap Could Be a Warning Sign for Trump's Trade War - USGI, accessed April 7, 2025, https://www.usfunds.com/resource/president-mckinleys-tariff-mishap-could-be-a-warning-sign-for-trumps-trade-war/

  23. The 'Napoleon of Protection': Lessons from William McKinley and the Tariff of 1890, accessed April 7, 2025, https://www.meatingplace.com/Industry/Blogs/Details/117862

  24. McKinley Tariff - Wikipedia, accessed April 7, 2025, https://en.wikipedia.org/wiki/McKinley_Tariff

  25. Revisiting the McKinley Tariff of 1890 through the Lens of Modern Trade Theory - Kevin A. Bryan, accessed April 7, 2025, https://kevinbryanecon.com/o3McKinley.pdf

  26. McKinley Tariff Act | United States [1890] - Britannica, accessed April 7, 2025, https://www.britannica.com/topic/McKinley-Tariff-Act

  27. GLOSSARY: McKinley Tariff Act of 1890 - Gotheborg.com, accessed April 7, 2025, https://gotheborg.com/glossary/mckinleytariffact.shtml

  28. Tax History Lesson: The McKinley Tariff - Tax Foundation, accessed April 7, 2025, https://taxfoundation.org/blog/tax-history-lesson-mckinley-tariff/

  29. McKinley's Tariffs: A Lesson from History - Concrete Logic Podcast, accessed April 7, 2025, https://www.concretelogicpodcast.com/blog/mckinleys-tariffs-a-lesson-from-history/

  30. Tariff Act of 1909 Limits Corporate Privacy | EBSCO Research Starters, accessed April 7, 2025, https://www.ebsco.com/research-starters/history/tariff-act-1909-limits-corporate-privacy

  31. Payne–Aldrich Tariff Act - Wikipedia, accessed April 7, 2025, https://en.wikipedia.org/wiki/Payne%E2%80%93Aldrich_Tariff_Act

  32. Payne-Aldrich Tariff Act | Description, Background, & Facts - Britannica, accessed April 7, 2025, https://www.britannica.com/topic/Payne-Aldrich-Tariff-Act

  33. Elections | 1912 Overview - HarpWeek, accessed April 7, 2025, https://elections.harpweek.com/1912/overview-1912-1.asp

  34. Tariffs, trade and taxes in the time of Trump - Insurance News | InsuranceNewsNet, accessed April 7, 2025, https://insurancenewsnet.com/innarticle/tariffs-trade-and-taxes-in-the-time-of-trump

  35. Underwood-Simmons Tariff Act | 1913, Importance, & Purpose | Britannica, accessed April 7, 2025, https://www.britannica.com/event/Underwood-Simmons-Tariff-Act

  36. Underwood Tariff Act | EBSCO Research Starters, accessed April 7, 2025, https://www.ebsco.com/research-starters/political-science/underwood-tariff-act

  37. A tariff-induced market shock - LGT Wealth Management US, accessed April 7, 2025, https://www.lgtwm-us.com/en/insights/market-views/a-tariff-induced-market-shock-256394

  38. Foreign trade of the United States - Wikipedia, accessed April 7, 2025, https://en.wikipedia.org/wiki/Foreign_trade_of_the_United_States

  39. Fordney–McCumber Tariff - Wikipedia, accessed April 7, 2025, https://en.wikipedia.org/wiki/Fordney%E2%80%93McCumber_Tariff

  40. Fordney-McCumber Act - Spartacus Educational, accessed April 7, 2025, https://spartacus-educational.com/Fordney-McCumber.htm

  41. Smoot-Hawley Tariff Act | History, Effects, & Facts | Britannica, accessed April 7, 2025, https://www.britannica.com/topic/Smoot-Hawley-Tariff-Act

  42. When protectionism backfired: The Smoot-Hawley Tariff Act of 1930 - EFG International, accessed April 7, 2025, https://www.efginternational.com/us/insights/2025/when_protectionism_backfired_the_smoot-hawley_tariff_act_of_1930.html

  43. Tariffs: 1930 Versus 2025 - National Association of Manufacturers - NAM, accessed April 7, 2025, https://nam.org/tariffs-1930-versus-2015-33709/

  44. Smoot–Hawley Tariff Act - Wikipedia, accessed April 7, 2025, https://en.wikipedia.org/wiki/Smoot%E2%80%93Hawley_Tariff_Act

  45. How the Smoot-Hawley Tariff Act compares to Trump's reciprocal tariffs - Newsweek, accessed April 7, 2025, https://www.newsweek.com/smoot-hawley-tariff-act-1930-donald-trump-reciprocal-2055368

  46. What Is the Smoot-Hawley Tariff Act? History, Effect, and Reaction - Investopedia, accessed April 7, 2025, https://www.investopedia.com/terms/s/smoot-hawley-tariff-act.asp

  47. Smoot-Hawley Tariff Act - Overview, Legislative History, Impact - Corporate Finance Institute, accessed April 7, 2025, https://corporatefinanceinstitute.com/resources/economics/smoot-hawley-tariff-act/

  48. The Economic Impact of Tariffs: Lessons from Smoot-Hawley and Modern Trade Policy, accessed April 7, 2025, https://ca.rbcwealthmanagement.com/john.vidas/blog/4460913-The-Economic-Impact-of-Tariffs-Lessons-from-Smoot-Hawley-and-Modern-Trade-Policy

  49. How Trade Agreements Have Enhanced the Freedom and Prosperity of Americans, accessed April 7, 2025, https://www.cato.org/publications/how-trade-agreements-have-enhanced-freedom-prosperity-americans

  50. U.S. Trade Policy: Background and Current Issues - CRS Reports, accessed April 7, 2025, https://crsreports.congress.gov/product/pdf/IF/IF10156

  51. Chapter 3 - US Trade Policy since 1934 - USITC, accessed April 7, 2025, https://www.usitc.gov/publications/332/us_trade_policy_since1934_ir6_pub4094.pdf

  52. Eighty Years After the Reciprocal Trade Agreements Act | United ..., accessed April 7, 2025, https://ustr.gov/about-us/policy-offices/press-office/blog/2014/June/Eighty-years-of-the-Reciprocal-Trade-Agreements-Act

  53. New Deal Trade Policy: The Export-Import Bank & the Reciprocal Trade Agreements Act, 1934 - Milestones in the History of U.S. Foreign Relations - Office of the Historian, accessed April 7, 2025, https://history.state.gov/milestones/1921-1936/export-import-bank

  54. Reciprocal Tariff Act - Wikipedia, accessed April 7, 2025, https://en.wikipedia.org/wiki/Reciprocal_Tariff_Act

  55. THE TRADE AGREEMENTS ACT OF 1934, accessed April 7, 2025, https://openyls.law.yale.edu/bitstream/handle/20.500.13051/12710/40_46YaleLJ647_1936_1937_.pdf?sequence=2&isAllowed=y

  56. Regulating Imports with a Reciprocal Tariff to Rectify Trade Practices that Contribute to Large and Persistent Annual United States Goods Trade Deficits - The White House, accessed April 7, 2025, https://www.whitehouse.gov/presidential-actions/2025/04/regulating-imports-with-a-reciprocal-tariff-to-rectify-trade-practices-that-contribute-to-large-and-persistent-annual-united-states-goods-trade-deficits/

  57. What Is the General Agreement on Tariffs and Trade (GATT)?, accessed April 7, 2025, https://www.investopedia.com/terms/g/gatt.asp

  58. www.investopedia.com, accessed April 7, 2025, https://www.investopedia.com/terms/g/gatt.asp#:~:text=Its%20primary%20objective%20was%20to,field%20for%20all%20participating%20nations.

  59. General Agreement on Tariffs and Trade (GATT) | Wex | US Law - Legal Information Institute, accessed April 7, 2025, https://www.law.cornell.edu/wex/general_agreement_on_tariffs_and_trade_(gatt)

  60. General Agreement on Tariffs and Trade Is Signed | EBSCO Research Starters, accessed April 7, 2025, https://www.ebsco.com/research-starters/history/general-agreement-tariffs-and-trade-signed

  61. General Agreement on Tariffs and Trade - Wikipedia, accessed April 7, 2025, https://en.wikipedia.org/wiki/General_Agreement_on_Tariffs_and_Trade

  62. General Agreement on Tariffs and Trade (GATT) | Britannica, accessed April 7, 2025, https://www.britannica.com/topic/General-Agreement-on-Tariffs-and-Trade

  63. www.cbp.gov, accessed April 7, 2025, https://www.cbp.gov/trade/north-american-free-trade-agreement#:~:text=North%20American%20Free%20Trade%20Agreement%20(NAFTA)%20established%20a%20free%2D,produced%20by%20the%20signatory%20nations.

  64. North American Free Trade Agreement | U.S. Customs and Border ..., accessed April 7, 2025, https://www.cbp.gov/trade/north-american-free-trade-agreement

  65. Suggested Search - North American Free Trade Agreement (NAFTA) - Federal Register, accessed April 7, 2025, https://www.federalregister.gov/north-american-free-trade-agreement-nafta-

  66. What Was the North American Free Trade Agreement (NAFTA)? - Investopedia, accessed April 7, 2025, https://www.investopedia.com/terms/n/nafta.asp

  67. North American Free Trade Agreement (NAFTA) | Definition, Purpose, Members, Replacement, & Provisions | Britannica, accessed April 7, 2025, https://www.britannica.com/event/North-American-Free-Trade-Agreement

  68. North American Free Trade Agreement - Wikipedia, accessed April 7, 2025, https://en.wikipedia.org/wiki/North_American_Free_Trade_Agreement

  69. How Did NAFTA Affect the Economies of Participating Countries? - Investopedia, accessed April 7, 2025, https://www.investopedia.com/articles/economics/08/north-american-free-trade-agreement.asp

  70. CBRE: Revised NAFTA Should Benefit U.S. Commercial Real Estate - MBA Newslink, accessed April 7, 2025, https://newslink.mba.org/cmf-newslinks/2018/october/mba-cmf-newslink-10-11-18/cbre-revised-nafta-should-benefit-u-s-commercial-real-estate/

  71. Trade Policy Creates Risk for North American Industrial Outlook ..., accessed April 7, 2025, https://www.areadevelopment.com/business-climate/q1-2018/trade-policy-risk-for-north-american-industrial-outlook.shtml

  72. How Can NAFTA Negotiations Impact Industrial Real Estate?, accessed April 7, 2025, https://blog.realestate.cornell.edu/2017/11/21/how-can-nafta-negotiations-impact-industrial-real-estate/

  73. U.S. Trade with China: Selected Resources - Research Guides at Library of Congress, accessed April 7, 2025, https://guides.loc.gov/us-trade-with-china

  74. China–United States relations - Wikipedia, accessed April 7, 2025, https://en.wikipedia.org/wiki/China%E2%80%93United_States_relations

  75. China–United States trade war - Wikipedia, accessed April 7, 2025, https://en.wikipedia.org/wiki/China%E2%80%93United_States_trade_war

  76. “Liberation Day” Tariffs Explained - CSIS, accessed April 7, 2025, https://www.csis.org/analysis/liberation-day-tariffs-explained

  77. What to know about the Trump tariffs upending global trade and markets - AP News, accessed April 7, 2025, https://apnews.com/article/trump-tariffs-economic-impact-trade-markets-3e38352ab5693852bfd9bc8dd2ac2d56

  78. Fact Sheet: President Donald J. Trump Declares National ..., accessed April 7, 2025, https://www.whitehouse.gov/fact-sheets/2025/04/fact-sheet-president-donald-j-trump-declares-national-emergency-to-increase-our-competitive-edge-protect-our-sovereignty-and-strengthen-our-national-and-economic-security/

  79. See the full list of reciprocal tariffs by country from Trump's "Liberation Day" chart, accessed April 7, 2025, https://www.cbsnews.com/news/trump-reciprocal-tariffs-liberation-day-list/

  80. Key moments and reaction to Trump's "Liberation Day" announcement of new tariffs, accessed April 7, 2025, https://www.cbsnews.com/live-updates/trump-liberation-day-announcement-tariffs/

  81. Tariffs in the second Trump administration - Wikipedia, accessed April 7, 2025, https://en.wikipedia.org/wiki/Tariffs_in_the_second_Trump_administration

  82. President Trump Announces 10 Percent Global Tariff, 11 Percent to 50 Percent Reciprocal Tariffs | Insights | Holland & Knight, accessed April 7, 2025, https://www.hklaw.com/en/insights/publications/2025/04/president-trump-announces-10-percent-global-tariff-11-percent

  83. President Trump Announces Significant Reciprocal Tariffs and Elimination of De Minimis Exemption - WilmerHale, accessed April 7, 2025, https://www.wilmerhale.com/en/insights/client-alerts/20250403-president-trump-announces-significant-reciprocal-tariffs-and-elimination-of-de-minimis-exemption

  84. Trump Tariffs: The Economic Impact of the Trump Trade War - Tax Foundation, accessed April 7, 2025, https://taxfoundation.org/research/all/federal/trump-tariffs-trade-war/

  85. President Trump Announces Reciprocal Tariff Policy - The Metals Service Center Institute, accessed April 7, 2025, https://www.msci.org/president-trump-announces-reciprocal-tariff-policy/

  86. Trump 2.0 tariff tracker | Trade Compliance Resource Hub, accessed April 7, 2025, https://www.tradecomplianceresourcehub.com/2025/04/04/trump-2-0-tariff-tracker/

  87. Trump's Reciprocal Tariff Calculations Are Nonsense, Will Punish Mutually Beneficial Trade, accessed April 7, 2025, https://taxfoundation.org/blog/trump-reciprocal-tariffs-calculations/

  88. Trump's Reciprocal Tariff Policy | German Marshall Fund of the United States, accessed April 7, 2025, https://www.gmfus.org/news/trumps-reciprocal-tariff-policy

  89. Tariffs: could "liberation day" shackle the global economy? | Allianz Global Investors, accessed April 7, 2025, https://www.allianzgi.com/en/insights/outlook-and-commentary/tariffs-global-economic-impact

  90. Trump's Trade War is a Major Economic and Strategic Blunder, accessed April 7, 2025, https://www.americanprogress.org/article/trumps-trade-war-is-a-major-economic-and-strategic-blunder/

  91. Experts React: How the world is responding to Trump's 'liberation day' tariffs, accessed April 7, 2025, https://www.atlanticcouncil.org/blogs/new-atlanticist/experts-react/experts-react-how-the-world-is-responding-to-trumps-liberation-day-tariffs/

  92. Tariffs and trade wars: What do they mean for investors? | Invesco US, accessed April 7, 2025, https://www.invesco.com/us/en/insights/tariffs-trade-wars-what-do-they-mean-for-investors.html

  93. Wall Street swings again as the approach of Trump's 'Liberation Day' wallops stock markets worldwide - AP News, accessed April 7, 2025, https://apnews.com/article/stocks-markets-rates-tariffs-9bbb04d6b66ccbda4f5856a179df20e3

  94. President Trump's 'Liberation Day' Tariffs Potential Impact on the U.S. Housing and Mortgage Markets - The World Property Journal, accessed April 7, 2025, https://www.worldpropertyjournal.com/real-estate-news/united-states/washington-dc-real-estate-news/real-estate-news-president-trump-2025-tariffs-data-liberation-day-tariffs-impact-on-housing-trump-tariffs-impact-on-mortgage-rates-in-2025-nahb-reacti-14408.php

  95. The Impact of Trump's Tariffs: What Investors Need to Know - AdvisorHub, accessed April 7, 2025, https://www.advisorhub.com/resources/the-impact-of-trumps-tariffs-what-investors-need-to-know/

  96. Trump tariff showdown could have huge impact on housing market - TheStreet, accessed April 7, 2025, https://www.thestreet.com/real-estate/trump-tariff-showdown-could-have-huge-impact-on-housing-market

  97. What Trump's New Tariffs Mean for Housing and Mortgage Rates - Realtor.com, accessed April 7, 2025, https://www.realtor.com/news/real-estate-news/trump-tariff-liberation-day-housing-costs/

  98. Trump Tariffs: What's Next for Investors? | Morgan Stanley, accessed April 7, 2025, https://www.morganstanley.com/articles/trump-liberation-day-tariff-announcement

  99. Tariffs and the U.S. Housing Market: A Historical Analysis of Economic Impacts, accessed April 7, 2025, https://admortgage.com/blog/tariffs-housing-market/

  100. How Tariffs Affect Home Prices: What You Need to Know | TrueParity, accessed April 7, 2025, https://trueparity.com/blog/how-tariffs-affect-home-prices-a-detailed-explanation

  101. Housing Market Gets Warning Despite 'Win' on Trump Tariffs - Newsweek, accessed April 7, 2025, https://www.newsweek.com/housing-market-gets-warning-despite-lumber-win-trump-tariffs-2056394

  102. The Impact of U.S. Tariffs on the Real Estate Market - St. Louis Argus, accessed April 7, 2025, https://stlargusnews.com/the-impact-of-u-s-tariffs-on-the-real-estate-market/

  103. Tariff Impact Real Estate | Building Material Costs - PBMares, accessed April 7, 2025, https://www.pbmares.com/tariffs-and-their-impact-on-the-real-estate-industry/

  104. Impacts: what effects could potential US trade tariffs have on the global economy and real estate? - Savills US, accessed April 7, 2025, https://www.savills.us/blog/article/373561/commercial-property/impacts--what-effects-could-potential-us-trade-tariffs-have-on-the-global-economy-and-real-estate-.aspx

  105. How Tariffs Impact the Home Building Industry | NAHB, accessed April 7, 2025, https://www.nahb.org/advocacy/top-priorities/building-materials-trade-policy/how-tariffs-impact-home-building

  106. Tariffs Can Impact the Real Estate Market in Unexpected Ways - Scotsman Guide, accessed April 7, 2025, https://www.scotsmanguide.com/commercial/tariffs-can-impact-the-real-estate-market-in-unexpected-ways/

  107. Trade Wars and Tariffs: How Are They Shaping Commercial Real ..., accessed April 7, 2025, https://investingincre.com/2025/02/07/trade-wars-and-tariffs/

  108. On Again, Off Again: Tariffs & Commercial Real Estate | CBRE, accessed April 7, 2025, https://www.cbre.com/insights/briefs/on-again-off-again-tariffs-and-commercial-real-estate

  109. The Trade Tides: How Tariffs Impact Commercial Real Estate | CanFirst Insights, accessed April 7, 2025, https://www.canfirst.com/news/the-trade-tides-a-historical-and-modern-perspective-on-tariffs-and-their-impact-on-real-estate

  110. How Tariffs Might Affect CRE in 2025 - CREA United, accessed April 7, 2025, https://creaunited.com/how-tariffs-might-affect-cre-in-2025/

  111. How Tariffs Could Impact Commercial Real Estate and Retail Spaces - Bullet Points, accessed April 7, 2025, https://www.schuckmanrealty.com/how-tariffs-could-impact-commercial-real-estate-and-retail-spaces/

  112. New wave of tariffs expected to rock US retail - CoStar, accessed April 7, 2025, https://www.costar.com/article/569056289/new-wave-of-tariffs-expected-to-rock-us-retail

  113. Navigating Tariff Risks in US Industrial and Logistics - Clarion Partners, accessed April 7, 2025, https://www.clarionpartners.com/insights/navigating-tariff-risks-us-industrial-and-logistics

114. History of tariffs in the United States - Wikipedia, accessed April 7, 2025, https://en.wikipedia.org/wiki/History_of_tariffs_in_the_United_States

Andrew Dunn
Previous

Investing in Resilience: Why Experiential and Necessity Retail Centers Stand Strong
Next

The Western US Retail Market in Q4 2024: Retail Space, Population, and Housing