Jeffrey Sachs Calls Trump Tariffs ‘Economically Illiterate’
Economist Jeffrey Sachs! (Image X.com)
The renowned economist warned that protectionist policies under Trump risk global trade fragmentation
By TRH Global Affairs Desk
August 2, 2025 — Leading development economist Jeffrey Sachs launched a scathing critique of US President Donald Trump’s trade policies during a keynote address at the Atlanta Diplomatic Conclave, calling Trump-era tariffs “economically illiterate” and “self-defeating” in the long run.
Sachs turned his focus on Trump often grounding his tariff policy around “we’ve been ripped off for many, many years. The United States has been ripped off like no country probably in the history of the world has been ripped off for 45, 50 years.”
“If you take your credit card and you go shopping and you run up a large credit card debt, you’re running a trade deficit with all those shops. Now, it would be pretty strange if you then blamed all the shop owners for having sold you all those things. You’re ripping me off, you’re ripping me off, you’re ripping me off,” Sachs remarked at the conclave.
The leading economist slammed “trade deficit” rationale of Trump, saying: “That is the level of understanding of the President of the United States. The trade deficit does not represent at all trade policies. It represents spending relative to production or earnings. We call that an identity.”
The economist further singed Trump by stating he teaches the basic trade economics on the second day of his class in international economics. “I teach it in the second day of my course in international monetary economics. Trump never made it to the second day,” said Sachs.
All that’s happening is the United States is outspending its national income, the economist added. Sachs, a professor and global policy advocate, warned that the resurgence of protectionist sentiment — particularly proposals for broad-based tariffs against China and other major economies — risk dragging the US into a new era of economic isolation, undermining both domestic competitiveness and global cooperation.
“Tariffs may win you applause at political rallies, but they lose you markets, supply chains, and global leadership,” Sachs said to a packed hall of diplomats, economists, and trade experts.
He also stated that “Trump’s approach treats the world economy as a zero-sum game — a view that is not only wrong but dangerous in the context of 21st-century global interdependence.”
Sachs described the Trump tariff regime — including the steep duties imposed on hundreds of billions in Chinese goods — as “economically regressive”, burdening American consumers and inflating costs for industries reliant on imports. He emphasized that US manufacturing did not meaningfully recover under the tariffs, and instead, many companies either passed on higher costs to consumers or shifted operations to third countries — defeating the intended purpose of reshoring jobs.
“We’re not bringing back manufacturing — we’re raising prices, hurting farmers, and pushing allies into trade blocs that exclude the US,” he said.
Sachs warned that the world is already witnessing the early signs of trade fragmentation, as countries respond to US tariffs with countermeasures and regional alliances, including RCEP in Asia and the EU’s growing trade pivot toward Africa and South America.
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