A vox.com article by Matthew Yglesias references a great blog post by Paul Krugman guesstimating the outcome of a global trade war as a tariff hike of 40%, a reduction in imports of 70%, and an associated welfare cost of 2.1% of GDP.
Krugman is right that this isn't enormous, but I wanted to add this perspective: If the labor share of GDP is 2/3, you would also end up with a 2.1% hit to GDP if you had roughly a 3% reduction in labor inputs. Since the financial crisis of late 2008, U.S. labor force participation has fallen about 3.2%, from 66.0% to about 62.8%.
I think that's revealing: it's consistent with the point that the world likely won't end as a result of a shock of this magnitude; and it's also useful to contextualize the shock this way, as something like the wave that swept a lot of people out of the labor force.
