Trump’s proposal was widely condemned across the globe. Canada’s Prime Minister, Justin Trudeau, said any U.S. tariffs on steel and aluminum imports would be “absolutely unacceptable” and European Commission President Jean-Claude Juncker said it “can only aggravate matters.”
Critics have also warned that tariffs will result in higher prices for consumers. On Thursday, Toyota said they would “substantially raise costs and therefore prices of cars and trucks sold in America.”
Shiller, an economics professor at Yale University, said that tariffs have been trending down for decades thanks to the general growth and prosperity around the globe.
“Low tariffs help the whole world organize itself better and helps relieve inequity,” he said. “The unfortunate thing, though, is that it does harm some American workers. We have to consider that.”
He also doesn’t dismiss critics who say China has been manipulating the steel market, creating an unlevel playing field. While he believes there are such manipulations, he said people like Peter Navarro, a China hawk who serves as White House National Trade Council Director, are overstating the issue.
“It’s good for the whole world if China prospers. We want to see everyone growing. That helps bring peace and tranquility and more good for us,” he said.
The White House did not immediately respond to a request for comment on Shiller’s remarks.
— Reuters contributed to this report.