Tyler Schipper, an economist and associate professor in the College of Arts and Sciences at the University of St. Thomas, was interviewed by AARP and WCCO Radio on tariffs. He talked to AARP on how to adjust to living with tariffs as an older adult. Schipper looked at tariffs from a historical approach with WCCO Radio.
From the AARP story:
Triggered by President Donald Trump’s far-reaching tariff plan, growing fears of a recession and worries of an escalating global trade war, the U.S. stock market lost a record-setting $6.6 trillion over a two-day washout from April 3-4. The event sent the Nasdaq Composite into a bear market, marking a 20% decline from the index’s peak. The other major stock indexes – the Dow Jones Industrial Average and the S&P 500 – aren’t in bear market territory, but investors fear they could be heading in that direction.
The glum sell-off raises alarm bells, particularly for older investors who have fresh memories of the most recent full-fledged bear market and its impact on their retirement accounts.
“The semantics about whether tariff policy will deliver long-run benefits despite short-run pain ignores the reality of many older adults and their retirement plans,” says Tyler Schipper, an economics professor at the University of St. Thomas who studies macroeconomics and real-time forecasting.
“Older Americans may not have a sufficient investment horizon to make up for these tariff-induced losses,” he adds. “Unfortunately, that means it is likely time to have a conversation with a trusted financial planner to reassess retirement goals.”
From the WCCO Radio story:
If you look back, the first notable tariff issue – even before there was a United States of America – was the Boston Tea Party, one of the key events leading to the Revolutionary War.
“That was really a response to tariffs on tea that were meant to raise revenue for the British,” explains Tyler Schipper, who is an assistant professor of economics at the University of St Thomas in St. Paul.
Schipper says another significant tariff was the Smoot–Hawley Tariff Act, which several economists have raised as a cautionary tale around raising tariffs. Smoot-Hawley was a protectionist trade measure signed into law by President Herbert Hoover on June 17, 1930, during the early days of the Great Depression, even as many economists warned that the levies would prompt retaliatory tariffs from other countries, which is precisely what happened. The U.S. economy plunged deeper into a devastating financial crisis that it would not pull out of until World War II.
“The problem is that it largely backfired,” Schipper says. “It made it so that we had a global trade war and global demand for our agricultural products and manufactured products kind of fell by almost two-thirds.”
