- A trade war involves countries raising tariffs (tax on specific import or export) in a back-and-forth, retaliatory effort to protect domestic industries or impose economic punishment.
- “The more goods you ship to another country, the more vulnerable you are to tariffs”.
- In the 1930s, US Congress passed the Smoot-Hawley Tariff Act to protect US industries during the Great Depression.
- In response, Canada and European nations imposed tariffs on US goods.
- Trump recently sparked potential US-China trade war by proposing tariffs on Chinese goods.
