The Liberation Tariffs: Worse Than an Oil Embargo?

David Rothkopf : Tariffs are like high oil prices: they hurt Americans in ways both visible and invisible.

He says oil shocks offer a good analogy to tariffs because oil is used everywhere, just like imports are used everywhere.

Oil is the main ingredient, of course, in retail gasoline, but it’s also used to create industrial lubricants, paints, Styrofoam , tires, and so much else.

Frida Ghitis : If we assumed tariff shocks were just like oil shocks, then we’d expect real American GDP to drop by 0.3 percent because of the Liberation tariffs.

Ghitis says there are good reasons to think the tariffs won’t just be like a rise in oil prices in an otherwise well-functioning market, but they may well be like the oil price shocks of the 1970s , in an economy with government-manipulated prices, ever-shifting taxes on oil production.