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Krugman Warns Of Stagflation Thanks To Trump’s Tariffs

  • Writer: By The Financial District
    By The Financial District
  • 20 hours ago
  • 1 min read

Citing President Donald Trump’s “really extreme policies on both trade and immigration,” particularly his tariffs, Nobel Prize–winning economist Paul Krugman is warning that the U.S. could soon face “stagflation” — a toxic mix of high inflation, rising unemployment, and stagnant demand, David Badash reported for AlterNet.


Americans could be in for a “nasty shock” of “inflation of 4% or more,”
Americans could be in for a “nasty shock” of “inflation of 4% or more,”
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“It’s Beginning to Smell a Lot Like Stagflation,” Krugman wrote on Friday. Noting that “it’s all about Trumponomics,” he warned that “the data really are looking increasingly stagflationary.”


Calling one report “quite grim on both inflation and jobs,” Krugman, an economics professor, cautioned that “just around the corner,” Americans could be in for a “nasty shock” of “inflation of 4% or more,” about a 50% increase from where inflation stands now.


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Krugman also noted that tariffs are inflationary, and that Trump’s “war on immigrants is also inflationary, because it is choking off production in industries that rely heavily on foreign-born workers.”


He pointed to reports of crops rotting in fields due to a lack of available labor, and “construction projects hobbled by ICE raids and a climate of fear.”


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Recently, Trump appeared to warn the judiciary not to overturn his tariffs, a possibility given that one court has deemed them unlawful and an appeals court seemed skeptical about their legal basis — a “national emergency.”


Trump said that if the courts overturned the tariffs, it would lead to “1929 all over again,” a reference to the Great Depression.



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