Trump tariffs are ‘megalomaniac’ and do not affect Brazil as much as he expects, says Nobel de Economy

Paul Krugman classifies Trump’s rates on Brazil as ‘megalomaniacs’ and ‘demonic’

American economist Paul Krugman used blunt words to classify Donald Trump’s tariffs against Brazil.

In a letter sent to Luiz Inacio Lula da Silva (PT), the president of the United States announced a 50% rate on Brazilian exports from 1st August.

In an article published on the Substack website, Krugman says these tariffs represent a “dictator protection program.”

According to the expert, who won the Nobel Prize in 2008 and is a professor at New York City University, Trump’s last letter “marks a new direction” of tariff policies, which he classifies from “demonic and megalomaniac.”

Krugman understands that the US president “does not even disguise that there is an economic justification for his decision.”

“Everything comes down to punishing Brazil for taking [o ex-presidente] Jair Bolsonaro [PL] To a judgment, ”he writes.

Early in the letter addressed to Lula, Trump says: “I met and dealt with former President Jair Bolsonaro, and respected him a lot, as well as most other country leaders. The way Brazil has treated former President Bolsonaro, a highly respected leader around the world, including the United States, is an international shame. This trial should not be happening.

The economy teacher points out that this is not the first time the US have been using tariffs with a political purpose.

“The international trade system we established after World War II was partly motivated by the belief of American representatives that these exchanges, besides being economic beneficial, would be a peace force and could strengthen democracy around the world. They were probably correct and, in any case, it was a noble goal,” ponders Krugman.

“But now Trump tries to use tariffs to help another dictator. If you think the US is one of the” good young men “in the world, this last decision shows the side we are currently,” adds the teacher.

For Krugman, Trump does not even use economic justifications to explain 50% tariffs on Brazilian exports and uses the tool as a kind of ‘dictator protection service’ | Getty Images

Why does Krugman think rates applied to Brazil are megalomaniac?

To justify the title of “megalomaniac” he gave to Trump’s announcement, the expert uses statistics from the Commerce Organization (WTO), which indicate which are the main business partners in Brazil.

According to data related to the year 2022, China is the main commercial partner of our country and receives 26.8% of exports.

Following are European Union (15.2%), USA (11.4%), Argentina (4.6%), Chile (2.7%) and other countries/blocks (39.3%).

Krugman estimates that exports to the US represent less than 2% of Brazil’s Gross Domestic Product (GDP).

“Trump really believes you can use rates to intimidate a huge nation that doesn’t even depend on the US market, to abandon democracy?” He asks.

For the economist, if the US “still had a functional democracy, this bet against Brazil would in itself be a basis for Trump’s impeachment”.

“Anyway, don’t ignore this fact. We’re facing another terrible step in the descendant spiral of our country,” he concludes.

Originally published by BBC News on 10/07/2025