If a 25% tariff is just a bargaining chip, that's one thing. But if it's in place for any length of time, it will be a disaster

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The consensus reaction to Donald Trump’s announcement of what history is bound to call the Trump tariff, to go along with the Smoot-Hawley tariff of 1930, is that we shouldn’t panic. Mind you, an immediate phone call from the prime minister to Mar-a-Lago and an emergency meeting of first ministers doesn’t quite seem consistent with that strategy. The PM reminding the president-elect that the daily trade flow is more than $1 billion — even when measured in U.S. dollars — mainly reinforces how much is at stake for us, though not so much for them. US$1 billion is real money, certainly, but the government Mr. Trump will soon head spends US$18.5 billion a day. We’ve got a lot more to lose in a tariff war than they do.

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The wiser, calmer heads currently warning against panic will tell us (won’t they?) when panic does become appropriate?

My first thought on hearing of Trump’s tweet was actually the 1950s, not the 1930s. Double-digit tariffs were common just after the war, before GATT and then the WTO really got going. In the 1950s our tariff on car imports — which until 1954 came more from the U.K. than the U.S. — was 17.5........

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