Trump levy 'fallacies' risk stagflation, economists say

Sweeping tariffs announced earlier this month by the Donald Trump administration are grounded in fundamental economic "fallacies" and risk triggering stagflation, financial instability and harm to US households and competitiveness, economists have said.

"The Trump tariff approach is premised on five fallacies and harms the economy in four major ways," said Lawrence Summers, former US treasury secretary and current Harvard University professor.

He spoke during an April 17 event hosted by the Peterson Institute for International Economics, or PIIE, on the macroeconomic impact of new US international policies.