Trump’s Iran War and His Tariffs Have History to Contend With
The reflexive response you get in Washington when you ask whether President Donald Trump will suffer any political consequences for whatever new shock he has dispatched into the US or global economy is often a combination of an eye roll and a shrug. A decade of Trump has taught wise operators not to apply the usual rules of politics to predicting his fortunes. The man has a knack for defying consequences.
Still, it’s worth paying attention to history. Because with an Iran war that has already delivered the biggest oil supply shock the world has ever seen and a tariff war that he’s not giving up on Trump is gambling again on defying the usual rules for what happens when economic shocks meet American elections.
Trump was already facing low approval ratings before he launched the attacks on Iran a little over two weeks ago. Global crude prices and politically-salient US gasoline prices have risen sharply since. And the early polls show voters aren’t excited about going to war with Iran.
That’s not the whole story, though. Trump is layering the joint economic and political shock of his war on top of that of his tariffs, which polls show almost two-thirds of voters disapprove of, making them even more unpopular than his war against Iran for the time being.
Middle East conflicts and high gas prices are a toxic mix in American politics. Just ask Jimmy Carter or George W. Bush, both of whom eventually suffered the political consequences.
In November 1976 when Carter was elected, the Vietnam War was over and the average price of a gallon of regular unleaded gasoline was 63 cents. By the time he lost the election in November 1980 the price of gasoline had doubled and the US was facing a hostage crisis in Iran.
The month before Bush launched a war against Iraq in March 2003 gasoline went for an average of $1.64 a gallon. By the November 2006 midterm elections, however, it was up almost 40% from before the war and Republicans had a grim night, losing control of both houses of Congress.
The summer before the 2008 presidential election the average price of a gallon of gasoline topped $4. Though by the November vote, with the US fully embroiled in the global financial crisis and a recession, the average price of a gallon of gasoline had fallen back to around $2. And yes, Republican John McCain lost that election.
On Sunday the average price of a gallon of regular gasoline stood at $3.70, according to the American Automobile Association, and was up 26% from a month ago.
Trump and his team have been working hard to portray the increase in gas prices as a temporary effect of a war that will pay off in the longer term. They’re also applying pressure on other countries to help secure the Strait of Hormuz so that oil tankers can start navigating through it again.
But it’s worth remembering that Trump’s tariffs haven’t gone away either. And that tariffs and American elections have a rich history too, as I write in this story for Bloomberg Businessweek.
The Trump administration started the process of repairing the large hole that the Supreme Court put in its tariff wall last month. Those efforts are due to gel this summer just a few months before the midterm elections.
If Trump were to learn from history – which he doesn’t seem likely to – he might rethink that plan. Because American presidents don’t have a great election record when it comes to tariffs.
John Quincy Adams was turfed out in 1828 elections after he signed into law what became known as the “tariff of abominations” William McKinley’s push for the 1890 duties that bore his name wound up costing him his seat in Congress. Herbert Hoover’s signature on the Smoot-Hawley Tariff Act of 1930 contributed to his Republicans losing control of Congress in midterm elections a few months later.