American Trade Wars: Touring U.S. Trade Spats From Tea Party to Trump

The Gino Beghe poster above from 1969 — with America deep into the Vietnam War — reflected the wishful thinking of a lot of folks affected by a bloody-and-divisive conflict.

Fast-forward 50 years and you could probably pose the same question about the Trump Trade War of 2025.

This war, too, has been divisive and bloody. Investors were the first casualties — the two-day wipeout of $6.6 trillion in U.S. shareholder wealth was an all-time record — though a “protracted war” will lead to also-bloody layoffs.

As author Mark J. Higgins wrote about the trade war ignited by the Smoot-Hawley Tariffs of 1930:

“The results were devastating,” wrote Higgins (author of Investing in U.S. Financial History,) in a LinkedIn story last week. “They contributed to a deepening of the Great Depression and accelerated the impoverishment of many nations. The effects were especially catastrophic in Germany and Japan. The impoverishment of the German people provided fuel for the rise of the Nazi party. The effects in Japan were ever more acute. With few natural resources, Japan was highly dependent on exports. The tariffs, combined with the effects of the Great Depression, forced Japan to exhaust its foreign exchange reserves, rendering it unable to purchase critical natural resources or even feed its people. This created pressure on Japan to expand its colonial empire, and it was a big factor in the invasions of Manchuria, China, and Southeast Asia. Appalled by Japanese aggression, the U.S. cut off oil exports to Japan. Realizing that this jeopardized their colonial ambitions, Japan attacked Pearl Harbor on Dec. 7, 1941, thus bringing the U.S. into World War II.”

There’s good news, however, Higgins underscored: “The Trump Administration has ample time to turn away from the abyss.”

BUT … there’s another side to this — a competing view.

You see, heavyweight tech investor Cathie Wood (founder and CEO of ARK Invest) believes the Trump Administration’s “shock therapy” tariff policy will deliver a very real payoff.

“Now that President [Donald] Trump has asked Secretary [Scott] Bessent to take the lead from Peter Navarro and Howard Lutnick in negotiating with our allies, what once seemed like a chaotic situation based on incomprehensible ‘reciprocity’ calculations could have been setup — premeditated or otherwise — for serious negotiations that will lead to lower tariffs and non-tariff barriers” — neither possible without that shock, says Wood.

In either case, let’s circle back to the war-themed aphorism (and artwork) that I opened with … and refer to another war-related aphorism that investors like us know well: Forewarned is forearmed.

Anticipating imminent danger can prepare us to deal with it …

In other words, as Higgins says: Know your financial history.

Know your trade wars …

Throughout U.S. history, trade wars have had varying impacts on the economy, interest rates, inflation, stock prices and everyday Americans. They’ve often (but not always) led to higher prices and economic disruptions.

Take a read … if nothing else, you’ll be smarter than everyone else at the office … or at your family Easter Dinner.

Here’s my free tour of American Trade Wars — starting with a variant of Beghe’s message:

What if they gave a tea party — and only revolutionists came?

1. Boston Tea Party (1773)

Here’s the Story: American colonists, fed up with stiff British taxes, dumped tea into Boston Harbor.

The Impact

Fun Fact: The Boston Tea Party was organized by the Sons of Liberty, a group of patriots who disguised themselves as Mohawk Indians to carry out the protest.

2. Smoot-Hawley Tariff Act (1930)

Here’s the Story: Raised U.S. tariffs on imported goods to protect domestic industries during the Great Depression.

The Impact

Fun Fact: Initially designed to protect American farmers from foreign competition, Smoot-Hawley raised tariffs on more than 20,000 imported goods. However, it actually slashed international trade, as other countries retaliated with tariffs of their own. The result: A massive trade war that caused American exports to plummet, contributing to bank failures and economic instability.

3. Chicken Tariff War (1960s)

Here’s the Story: U.S. imposed tariffs on German trucks in retaliation for European tariffs on American chicken.

The Impact

Fun Fact: The Chicken Tariff War led to the creation of the Ford Transit Connect, a small cargo van designed to circumvent the tariffs on light trucks.

4. Trade War with Japan (1987)

Here’s the Story: U.S. imposed tariffs and trade restrictions on Japanese goods to counteract perceived unfair trade practices.

The Impact

Fun Fact: The 1987 trade war with Japan led to the popularization of Japanese cars in the U.S., as Japanese automakers established manufacturing plants in America to avoid tariffs.

5. Canada-U.S. Lumber Wars

Here’s the Story: Long-standing disputes over tariffs on Canadian softwood lumber imports.

The Impact

Fun Fact: The Canada-U.S. Lumber Wars have been ongoing for over 40 years, with multiple rounds of negotiations and disputes.

6. Banana Wars (1993)

Here’s the Story: Trade dispute between the U.S. and EU over banana import tariffs favoring former European colonies.

The Impact

Fun Fact: The Banana Wars involved not just the U.S. and EU, but also several Caribbean nations whose economies heavily depended on banana exports.

7. Steel Tariff (2002)

Here’s the Story: U.S. imposed tariffs on steel imports to protect domestic industry.

The Impact

Fun Fact: The 2002 steel tariffs were lifted after just 20 months due to pressure from U.S. businesses and the threat of retaliatory tariffs from other countries.

8. Ongoing Trade War with China

Here’s the Story: Escalating tariffs and trade restrictions between the U.S. and China starting in 2018.

The Impact

Fun Fact: The ongoing trade war with China has led to some unexpected consequences, such as a surge in demand for American soybeans from other countries like Brazil.

Hope you folks found this valuable …

See you next time;