Yale University economics professor emeritus and Nobel laureate says President and are sowing fear and economic instability鈥攂oth at home and abroad.
Shiller, known for , told 海角换妻 Radio the whipsawing trade strategies under Trump have hurt U.S. credibility and created an environment ripe for job loss and recession.
Tariffs and uncertainty erode confidence
鈥淭he economic environment right now is already and will continue to cause job loss for many people,鈥� Shiller said. He warned that families may be forced to relocate to keep jobs, and that even those not directly affected by trade shifts could begin cutting spending out of fear.
According to Shiller, this kind of fear鈥攅specially when stoked by unpredictable government policy鈥攃an become self-reinforcing.
鈥淭hat destroys their economic confidence,鈥� he said.
Walking back tariffs, but not the damage
Since taking office, President Trump has repeatedly imposed tariffs on foreign goods, only to reduce or delay them later. Shiller said he expects more walk-backs ahead鈥攅specially where China is concerned鈥攁s part of ongoing negotiations.
But the long-term credibility cost, he said, has already been paid.
鈥淗is credibility has been damaged,鈥� Shiller said. 鈥淎nd unfortunately, it damaged the credibility of the United States as being consistent in its attitude toward foreigners.鈥�
Echoes of history
Shiller drew a direct comparison between today鈥檚 . He cited the , which many economists blame for deepening the Great Depression and worsening global instability.
鈥淭hat led to the election of Adolf Hitler in 鈥�33,鈥� Shiller said. 鈥淚t might have been behind the beginning of World War II.鈥�
He added that today鈥檚 citizens, aware of such history, naturally worry when international cooperation appears to fray.
Advice to state legislators: Prepare to spend
Asked what state lawmakers should do to brace for what he sees as an economic storm, Shiller urged a proactive stance鈥攅ven if that means borrowing in the short term.
鈥淭hey鈥檙e supposed to borrow money in times of crisis,鈥� he said. 鈥淚 would say that we may be entering such a time.鈥�
He added that for states lucky enough to have a surplus, like 海角换妻, now may be the time to responsibly draw from it to stabilize services and support struggling residents.
An uncertain road ahead
Shiller鈥檚 message was clear: While economic forecasting is difficult under any circumstances, the current climate鈥攎arked by unprecedented shifts in federal policy and rhetoric鈥攊s particularly fraught.
鈥淲e鈥檝e never seen such wild changes in tax rates,鈥� he said.
Whether those shifts turn into a full-blown economic crisis remains to be seen. But for now, Shiller says both governments and citizens would be wise to act as if the storm is coming.
