Does Kindleberger’s Spiral Predict Economic Depressions?
Some experts are reaching for this apocalyptic chart of the over-tariffed world in the 1930s. It really points toward a different inflection point.
Shipping containers at the Port of Seattle, Washington: Will all this dry up?
Photographer: David Ryder/BloombergWhen fears of crisis loom, some people reach for the Kindleberger Spiral. The original was a wonky, awkwardly scaled spiderweb showing the collapse of global trade from 1929 to 1933, accelerating after the Smoot-Hawley Tariff Act was passed by the US Congress in June 1930 — in tandem with the Great Depression. Even updated (below), it still has an ominous look: a swirling whoosh of water being sucked down a drain — which makes it troublingly evocative right now with President Donald Trump arbitrarily carpet-tariffing the world, and bringing chaos to stock markets everywhere.
The chart, however, is less a schematic than an entry point into a more complex story. The tariffs didn’t cause the Great Depression — but the work of the economist behind the spiral still has a serious warning for today. It is all about America’s role in the world.