In 2018, when the United States launched tariffs against Chinese goods, officials promised quick victory. China would capitulate within weeks, they said. Four years later, most tariffs remained in place, consumers paid billions more for everyday goods, and neither side had achieved their stated objectives. This pattern wasn't new—it was history repeating itself with remarkable precision.

From the Smoot-Hawley tariffs that deepened the Great Depression to Napoleon's Continental System that ultimately weakened France more than Britain, trade wars follow a predictable script. They begin with confident promises, escalate through retaliation, inflict widespread economic damage, and end with quiet retreat—often decades later. Understanding why this pattern persists can help us recognize the warning signs before the next conflict spirals out of control.

When President Hoover signed the Smoot-Hawley Tariff Act in 1930, raising duties on over 20,000 imported goods, he believed it would protect American farmers and manufacturers. Within two years, twenty-five countries had retaliated with their own tariffs. Canada, America's largest trading partner, matched U.S. rates product by product. World trade collapsed by 65 percent, turning a financial crisis into a global depression.

The logic of retaliation seems obvious in hindsight, yet leaders consistently underestimate it. When Country A imposes tariffs, Country B faces intense domestic pressure to respond. Industries affected by foreign tariffs demand protection of their own. Politicians who appear weak on trade face electoral punishment. Each round of retaliation creates new constituencies demanding further escalation. The Napoleonic Wars offer an earlier example: Britain's naval blockade prompted France's Continental System, which prompted British countermeasures, which prompted French enforcement that eventually required military occupation of allied territories.

What makes these cycles so dangerous is their self-reinforcing nature. The damage caused by Country B's retaliation becomes justification for Country A's next move. American soybean farmers hurt by Chinese counter-tariffs in 2018 didn't blame the initial tariffs—they demanded government support and additional pressure on China. Each side points to the other's actions while ignoring their own role in the spiral.

Takeaway

Trade restrictions rarely remain one-sided. Before supporting any tariff, consider not just its immediate effect but the retaliation it will trigger and the counter-retaliation that follows.

The stated purpose of trade wars is protecting domestic industries, but the actual effect is often the opposite. During the 1930s, American tariffs on imports meant American exporters faced tariffs abroad. U.S. automobile exports fell 70 percent. Cotton exports collapsed. The farmers Smoot-Hawley was designed to help saw their overseas markets vanish entirely.

Modern supply chains make this self-harm even more severe. When the U.S. imposed steel tariffs in 2018, American steel producers gained temporary relief. But American manufacturers who use steel—automakers, appliance producers, construction companies—faced higher costs. The steel-using industries employ fifty times more workers than steel production itself. Studies found the tariffs cost more American jobs than they saved. Meanwhile, American consumers paid an estimated $900,000 per job supposedly protected.

History's most dramatic example might be Jefferson's Embargo Act of 1807, designed to punish Britain and France by cutting off their access to American goods. Instead, it devastated American ports, bankrupted merchants, and caused food shortages in New England. The law was repealed after fourteen months, having achieved none of its objectives while inflicting severe damage on the American economy. The lesson was clear but apparently not learned: economic weapons wound the wielder as much as the target.

Takeaway

Tariffs are taxes paid by domestic consumers and businesses, not foreign countries. Any analysis of trade restrictions must account for costs throughout the entire economy, not just benefits to protected industries.

Perhaps the most troubling pattern is how trade wars persist long after their futility becomes obvious. The Smoot-Hawley tariffs weren't fully reversed until the 1940s, and only then because World War II created entirely new political circumstances. The U.S.-China tariffs imposed in 2018 largely remained in place through 2024, despite multiple changes in administration and widespread acknowledgment that they hadn't achieved their goals.

The political economy of ending trade wars is brutally unfavorable. Industries protected by tariffs become dependent on that protection. Workers in those industries vote. Reducing tariffs means concentrated, visible job losses in specific communities, while the benefits—lower prices, improved efficiency—spread diffusely across millions of consumers who barely notice. Politicians who remove protection face attack ads featuring unemployed factory workers. Politicians who maintain failed tariffs face no comparable accountability.

Britain's Corn Laws illustrate the rare circumstances required for reversal. These agricultural tariffs, which raised food prices for urban workers while enriching landowners, persisted for decades despite obvious harm. Only the Irish Famine of 1845-1846 created sufficient political crisis to overcome entrenched interests. Even then, the governing Conservative Party split apart over repeal. Most trade wars end not through rational policy adjustment but through external shocks that rearrange political coalitions entirely.

Takeaway

Once established, protectionist policies create their own political constituencies. The question isn't just whether a tariff makes economic sense today, but whether it can ever be removed once the interests it creates become organized.

The historical pattern is clear: trade wars promise protection but deliver mutual impoverishment. They promise quick resolution but create political traps that persist for decades. They promise national strength but weaken domestic industries dependent on global supply chains and export markets.

None of this means trade policy should be passive or that every grievance is illegitimate. But history suggests extreme skepticism toward confident predictions of easy victory. The leaders who launched history's trade wars always believed their situation was different. They were always wrong.