Game On! Game Off!

In the 1992 movie Wayne’s World, there’s that classic street hockey moment where Wayne and Garth yell “Game off!” every time a car comes down the street, everyone moves aside, the game stops and then “Game on!” as soon as the street clears.  It’s funny in a movie, but when tariffs in an economy are suddenly switched “on” and then “off” just days later, the effect can be just as disruptive to a much larger set of actors.

For businesses, the “Game off!” moment is when a tariff is announced or imposed.  Just last week, the Trump administration announced an additional 100% tariff on goods imported from China.  A jump this large might have caused economic consequences.  Firms may have halted shipments, changed suppliers, paused investment plans, and/or scrambled to reprice goods.  Just a few days later, the “Game on!” call comes when President Trump downplayed the move, suggesting everything would be fine in a social media post.  This certainly caught the market’s attention as prices for stock derivatives started rising before Monday’s opening bell.

Repeated stop‑start changes erode efficiency, raise transaction costs, and discourage long‑term planning.  Just like in the movie, constant interruptions mean the game never flows smoothly.  Unfortunately, the “game” we’re all participating in is comprised of manufacturing, supply chains, and commerce.  Those playing are trying to stay competitive while dodging policy traffic that keeps running through the middle of the street.  Tariffs have increased government revenue in the short-run, there’s no denying that.  What is unclear ultimately, is whether or not they will impede economic growth over the intermediate to long-term.