Tariffs, Growth, and Brexit

Scott Sumner’s post Tariffs and the Economy observes that the most important effects of tariffs are not big, dramatic, or immediate ones. They’re the hits to long-term growth as arrangements gradually become less efficient and lower growth rates compound. 

The lack of an immediate, catastrophic outcome could be used as an excuse to dismiss tariffs as not that big a deal. Even at the point of the biggest market losses after the Rose Garden tariff announcements, the S&P 500 was at far higher levels than it had been five years prior.