Trump targets Mexico and Canada with tariffs, plus an extra 10% for China

Tariffs are retaliation for drug trafficking and illegal migration.

See full article...

 

[s73v3r]

This sounds like deja vu- he hasnt actually implemented any policies yet and the media is peppered with articles from 'experts' on the adverse effects of tariffs - just like how it was in the first Trump term.

Because he literally just said he wants to enact them. Miss us with that, "He doesn't always mean what he says" bullshit.

But as the left leaning bias

There is no "left leaning bias" in the media. They're reporting on what TRUMP HIMSELF HAS FUCKING SAID.

during the Biden administration, there was little talk of tariffs, especially not in such a negative light

Because Biden wasn't threatening new tariffs.

But I guess it was OK then because 'my guy' did it.

No, it's because Biden wasn't stupidly threatening blanket tariffs for no fucking reason on our largest trading partners.

 

[s73v3r]

Except that's false. He hasn't accumulated the wealth he has. Everything was inherited from his father. Sure his decades of play-acting as a smart businessman hasn't resulted in him personally being bankrupted, but that's mostly because once you start out with enough wealth (as Trump did from his father), it's practically impossible to lose it all just because of the momentum of the market.

Hell, had Trump simply put all that money he inherited in the S&P 500, he'd have much more money than he does now.

 

[Statistical]

As for 'stagflation,' yes, I’m familiar with it. But it seems like we’re already flirting with that, considering inflation hasn’t exactly vanished under Biden. If the distinction you’re making boils down to degree rather than kind, then it sounds like the criticism should extend to both, or we’re just splitting hairs over whose tariffs are 'profoundly stupid.'

Inflation is way down. Inflation NEVER disappears because the opposite of inflation is DEFLATION which is even worse. Not only is inflation way down the fed has been able to slowly start reducing interest rates and the economy is growing robustly.

Idiotic broad brush tariffs run the risk of reversing all that.


Yes we did flirt with stagflation which is why it is pretty damn amazing we got inflation under control without crashing the economy and now all that is at risk again.

 

[SixDegrees]

We focus a lot on this side of the deal for Canada, but for some reason, a lot of Americans are very unaware of the effects from Mexico as well. It's not a small economy, and given the already problematic peso vs dollar exchange rate where the peso has lost value, this is going to compound the issue. In 2022, which is the year I found numbers for quicker, Canada imported $481.2 billion US goods and services. Like the article said, this is more than those 4 big economies combined. What the article is missing, is that Mexico imported $493.1 billion which is even more than Canada.

What I'm afraid of is that Trump, his cabinet, and his supporters at large just see Mexico as this nuisance and small potatoes neighbor that can be slapped around without consequences because of a mistaken image of its importance to the US economy. Imagine cutting off all exports to China, Japan, France, and the UK, like the article compares to. Sounds bad right? Yeah, Mexico would be worse. That's not even where it stops. There's a shit ton of trade with Mexico that happens at the borders which isn't accounted for. Mexicans cross over, buy stuff, which is accounted as domestic sales, then drive back. This happens every single day to the tune of billions of dollars a year. If you weaken the Mexican economy, this will surely drop, some by economic necessity some by "fuck you then I'm not buying" attitudes.

There are other impacts not being considered. Does anyone in this administration, or even in this comment thread, know that Mexico buys more US wheat and corn than anyone else and by a freaking lot? In 2021/2022, 40% of total wheat sales and 27% of total corn sales were to Mexico. I think at some point, and it may still be true, it bought more wheat than the rest of the western hemisphere combined. 17% of all agricultural exports last year were to Mexico. That's gonna devastate the US economy if Mexico retaliates. Will they be worse off? Absolutely, but this is like chopping off your arm for the bragging rights of saying you chopped off their arm and leg. What the hell is the benefit of this? And again, I'm counting just Mexico because I have more experience with the economic trade to the southern neighbor and have noticed there's a lot of ignorance about how big and important that is. Adding Canada will chop off the other arm, and sure, Canada will also be down an arm and a leg, which is more than the US will lose, but now we're down 2 arms and China and the EU haven't even entered the death cage.

In fact, there's even the possibility that the US will end up worse than what I'm portraying here. When you're pissing away your allies and being an asshole to everyone, nobody likes you, and worse, nobody trusts you. The rest of the world is going to be more willing to make deals with Canada and Mexico than with a Trump led US. That means there is a pretty good chance others swoop in to stave off the bleeding for our neighbors. Does anyone have a country or alliance in mind that would do that for the US with that leadership?

Yes. Mexico surpassed Canada a couple of years ago as the US' largest trading partner. Even if it swaps with Canada again it will still be the second largest.

It's a recipe for inflation, and lots of it.

 

[s73v3r]

Based on what Trump said during the election campaign - which is dangerous because what he says and what he actually does are often different things - the chances are most of the rest of the world will be following Canada's policy and imposing targeted tariffs on US goods that can be easily sourced elsewhere but are currently produced in Republican voting areas. That is how an asymmetrical trade war works. It will not end well for the US and even worse, it can take a long time after the tariffs have been repealed for trade to revert to pre-tariff levels

I wonder if there have been any studies showing what impact those targeted tariffs had on subsequent elections. I would hope they would influence people to not vote Republican, but it doesn't look like it worked.

 

[ShaneK]

The thing that really kills me is that if Mexico had a roaring economy, we'd definitely be getting fewer people wanting to illegally cross the border into the US. Most people want to live where the live, and don't want to uproot their lives and take the risk of crossing illegally. They only do that when they're desperate.

 

[Voldenuit]

Two words: buy refurbished. I can certify from personal experience that Amazon Renewed electronics are a great way to save money, if you're okay with buying tech that's a few years out of date. Last week, I bought an iPhone 12 (as a testing device, since I write smartphone apps targeting both major mobile platforms) - and which runs the latest version of iOS - for $333 including tax and shipping (look up the street price for an iPhone now if you think that's a non-starter).

There are more places than ever offering refurbished electronic products, but you'll probably need to look around. If prices on tech are about to become prohibitive, going refurbished might be a workable solution for many.

Only a stopgap solution.

If new goods prices rise, used good prices will rise because there will be more demand and less competition. Look at used car prices during the shipping shortages, for example.

Bottom line is that everyone is screwed, and will continue to be screwed for decades to come from the economic fallout.

 

[LibraryCommoner]

I really think the subtitle should say "Trump claims..." they are because of drugs. It is disingenuous to go along with his nonsense lies as if he is being truthful. That shouldn't happen on Ars.

We all know that isn't the case. Trump is either just an idiot who doesn't understand how tariffs work, or is relying on the fact most of his base don't understand tariffs. It is all about money.

it's a Financial Times article, i don't know how much editorial control ars has over this.

 

[s73v3r]

Let's see: Biden does 100% Chinese tariffs on EVs, and you're 'a-OK!' with it. Trump does 25% and you're all like: 'This is what people voted for!'

You're being extremely dishonest by not pointing out that Trump's tariff is on LITERALLY EVERYTHING IMPORTED.

Yes it is!

People didn't vote for raising prices.

And if anything, isn't he being consistent with what YOU voted for as well?

Nope. Nobody I voted for threatened blanked tariffs, making literally everything more expensive, and making inflation worse.

He's just ramping up what the government was already doing

No, he's not, and you're being extremely dishonest.

Yes, I'm calling you a hypocrite

Which, again, doesn't work when you're flat out lying.

 

[Purpleivan]

China is also electronics, computers & network gear. Most people don't make their living raising horses in Montana & will notice major hikes in everything impacted by all of these.

Add to that, this is only his first step. There will be many more, impacting the EU, Korea, Japan, and everywhere else not ruled by a dictator.

Electronics is one of those "it affects everything" industries, such as energy. Almost any company in the company either buys them for their own use, or buy services from those that do. Even that person raising horses in Montana is likely to pay for some service(s) that makes use of electronics in a significant way.

Sure, some people and companies will be affected more than others by such tariffs, but anyone assuming that they're not affected by them, will be, even if it's just to a lesser degree.

 

[Joel Bruner]

Wow, so can I mention iPad prices going up here? 3 weeks ago I commented on an iPad sale story on MacRumors something like "Honest question, will proposed tariffs will drive up iPads prices? Wondering if I should I buy a new one before next year" and they deleted the comment and gave me a warning about "discussing politics" in a non-political story. Sheesh. Anyway - I think Tim Apple and his lobbyists will look for ways around this, of all companies I don't think they'll absorb the cost to keep the price points the same for consumer. They are going to keep those margins where they are.

 

[Statistical]

The thing that really kills me is that if Mexico had a roaring economy, we'd definitely be getting fewer people wanting to illegally cross the border into the US. Most people want to live where the live, and don't want to uproot their lives and take the risk of crossing illegally. They only do that when they're desperate.

Yes and in fact the Mexican economy HAS been growing robustly for last 5 or 6 years which has led to massive reduction in illegal immigration from Mexico. It has even led to some illegal immigrants voluntarily returning to Mexico for better economic prospects.

So it isn't even a future hypothetical it is happening right now and this would reverse that.

 

[Quiet Entropy]

Smoot-Hawley 1930s. What happened to semi-qoute a poster, is we threw knives at everybody and then they threw them back. Both Smoot and Hawley were Republicans. FDR helped a great deal but WW2 industrialization was what finally got us back.

Yes there is stuff "made" here but some of those parts come from somewhere else. Produce out of season comes from south of the border. I still remember Trump's bully boys letting truckloads of avocados rot. Take a look at your local supermarket's shelves of canned goods and see where they come from. Coffee and tea don't grow here.

It's going to suck. I voted Harris but she didn't win. Take a hard look and see if those appliances will last four more years. Will that car keep going? How's the roof and the HVAC? Start looking at debt.

 

[s73v3r]

Call the hypocrisy anything you want; the double standards are clear.

Only when you decide to completely lie about everything.

 

[Bob Dobilina]

That is not true. First many non-Trump Republicans are Republicans from prior to Trump and are still in Congress. Second Gaetz shows Republicans have their own agendas and ideologies and future ambitions which aren't exact copies of Trump.

I am not saying it is going to be a good four years but Trump is more liability than benefit for Republicans now beyond rubber stamping whatever horrible nonsense they want to pass.

Cozying up to Russia, abandoning NATO, ignoring China, and collapsing the US economy are not top agenda items for most (not all but most) Republicans. They are more interested in deregulation, tax cuts for billionaires, and throwing some social issue red meat to voters to razzle dazzle them.

Republicans in Congress are going to try and thread a fine line. They can't openly oppose Trump but they also don't want to lose in a landslide in 2026/2028 when Trump's idiotic plans collapse the US economy. So just my $0.02 they will implement some deportation but far less than 12M people and very loudly declare victory and congratulate Trump so they can get the actual stuff they want implemented. Similarly I believe aid to Ukraine will continue (I know I am a minority) because a Russia bleeding out in Ukraine is in the best geopolitical interest of the US. The aid isn't because we have an obligation or it is the right thing to do but because it benefits the US.

Part of the GOP plan is to keep the filibuster. They can point to the Dems and say that its the Dems' fault that Trump can't get 60 votes in the Senate. I'm surprised that Trump isn't screaming about getting rid of the filibuster.

 

[s73v3r]

Sure, go ahead and call me a moron if ad hominem is your preferred style of debate.

You decided to be dishonest about your point, so you don't get to whine about people calling you names.

 

[Statistical]

It's going to suck. I voted Harris but she didn't win. Take a hard look and see if those appliances will last four more years. Will that car keep going? How's the roof and the HVAC? Start looking at debt.

Which is in itself inflationary. Individual should still do it. Lock in those replacements now if you can but more consumer demand chasing the same amount of production is going to lead to price increases. The economy is always forward looking. People trying to escape the impact in aggregate cause the impact.

 

[Gunslinger13]

I don’t get it. Trump is not stupid. Does he think that this is a bluff and Canada and Mexico will give some concessions right away to avoid the whole thing? Trump knows the economy will reflect on him. I just don’t ge

I don’t get it. Trump is not stupid. Does he think that this is a bluff and Canada and Mexico will give some concessions right away to avoid the whole thing? Trump knows the economy will reflect on him. I just don’t get it.

Yes - ignore the evidence of your eyes and ears. Disregard the never ending torrent of stupid things he says and does. That's just the librul media being mean. Ignore the parade of clowns he is personally appointing to his administration. He couldn't possibly be stupid - that would mean I voted for the stupid guy and that just can't be. He must be playing 27D chess - that's the ticket...

 

[dEvErGEN]

I don’t get it. Trump is not stupid. Does he think that this is a bluff and Canada and Mexico will give some concessions right away to avoid the whole thing? Trump knows the economy will reflect on him. I just don’t get it.

There is a major flaw with your first assumption.

 

[mgmcd1]

Listen people, settle down. Drumpf had to give the billionaires $10T US in tax cuts last time, and now he needs to make up some of that lost revenue... from us proles. WE get to pay those extra costs to save our beleaguered corporate overlords! Coupled with the $2T US he wants to remove from government spending, including the 1,000,000 government workers he wants to fire... um, wait... this is looking bad. Now where did I put that dumpster fire meme...

 

[Ralf The Dog]

This in the long term might be a very good thing for Canada and Mexico. The question is, how can the two countries trade without having goods transfer through the United States. Some can be shipped by ship, but rail is just so cheep.

 

[s73v3r]

Smoot-Hawley 1930s. What happened to semi-qoute a poster, is we threw knives at everybody and then they threw them back. Both Smoot and Hawley were Republicans. FDR helped a great deal but WW2 industrialization was what finally got us back.

Yes there is stuff "made" here but some of those parts come from somewhere else. Produce out of season comes from south of the border. I still remember Trump's bully boys letting truckloads of avocados rot. Take a look at your local supermarket's shelves of canned goods and see where they come from. Coffee and tea don't grow here.

It's going to suck. I voted Harris but she didn't win. Take a hard look and see if those appliances will last four more years. Will that car keep going? How's the roof and the HVAC? Start looking at debt.

Also, most of our manufacturing is very high tech. Meaning it doesn't employ a lot of human labor. So even if somehow manufacturing of some items comes back, it's not going to have nearly the amount of jobs that it would have had before.

 

[fractl]

Hopefully it will bolster the US workforce and allow better livable wages for the lower class instead of shipping production/manufacturing/hourly wage jobs elsewhere. Let's raise the floor!

Say Company A imports a widget. Trump adds 25% tariffs to cost of said widget which is now Price X. Company Y increases domestic production of said widget: What will the cost be? Since the competing, imported widget is Price X, the domestically produced widget will cost Price X minus delta (and delta could be 0) as there is no benefit to the Company Y to undercut the competition if demand remains the same.

tl;dr : You get inflation as goods get more expensive. On top of which, it can take years for domestic production to increase as factories need to be built or retooled, workers need to be trained, etc. etc.

 

[s73v3r]

Part of the GOP plan is to keep the filibuster. They can point to the Dems and say that its the Dems' fault that Trump can't get 60 votes in the Senate. I'm surprised that Trump isn't screaming about getting rid of the filibuster.

Trump doesn't want Congress. Hell, he didn't even want Congress to consider his appointments; just that they should go to recess so he can recess appoint people. He's going to do everything he can, and then some, through Executive Order.

 

[Statistical]

Wow, ‘deflation is worse’: a typical line that conveniently skips over the nuance of why persistent inflation wreaks havoc, especially on the working class.

Deflation is worse. Much much worse. Worse for everyone. The ideal scenario would be exactly 0% inflation. The money supply grows or shrinks by exactly the same amount as production does. A loaf of bread which is $5 would always be $5. It would be $5 in a recession and $5 in a booming ecnomy. $5 today, $5 in 20 years, $5 in 1000 years. However the tools for mananging an economy are not that precise so low persistent inflation is the only thing which we can target. It is something that can be planned around. Chaotic high inflation or worse flipping between high inflation and high deflation is economically destructive.

Sure, inflation is down for now, but the economy isn’t exactly out of the woods.

EXACTLY. Which makes slapping a massive inflationary tarifff on just about everything utterly horrific. We are not out of the woods and now Trump wants to light the woods on fire.

Wages aren’t keeping up with cost-of-living increases, and most people don’t have the luxury of celebrating a technical reduction in the CPI while housing, food, and energy are still punishing their wallets.

That is incorrect. Wages are growing in real terms NOW. However there are 3 years of PAST price increases where wages had negative real growth. The current trajectory is positive though and if it continued it would dig out of that hole. We can't undo the past. Right now is the best that can happen. We have positive real wage growth which means budgets will get easier in time ... IF things remain the same.

Maybe deflation isn’t the bogeyman it’s made out to be, at least it doesn’t erode purchasing power for people living paycheck to paycheck.

It is when you don't have a paycheck to erode.

 

[SixDegrees]

Part of the GOP plan is to keep the filibuster. They can point to the Dems and say that its the Dems' fault that Trump can't get 60 votes in the Senate. I'm surprised that Trump isn't screaming about getting rid of the filibuster.

Trump wants to do the same thing he did in his first term: ignore Congress as much as possible. He got one significant legislative item through Congress last time - his tax cut - and then squandered republican control of Congress completely and proceeded to govern by edict with a stream of executive orders. He wants to be the one telling everyone what to do, and having to negotiate even with his own party in Congress rankles him. He wants kingly powers, without lower people getting any say in anything.

 

[SixDegrees]

This in the long term might be a very good thing for Canada and Mexico. The question is, how can the two countries trade without having goods transfer through the United States. Some can be shipped by ship, but rail is just so cheep.

I don't think tariffs apply to goods that simply transit through US territory; I'm pretty sure they're only an issue when the goods in question stop in the US.

 

[uesc_marathon]

Good odds on Loser getting an Article 25 action by midterms.

That's cute, you think the legislative branch is capable of policing the executive. Checks and balances was religion, not reality.

 

[ACF423]

Yes, have a man whose companies have declared bankruptcy 6 times "fix" the economy. This will go so well.

 

[Ralf The Dog]

Deflation is worse. Much much worse. Worse for everyone. The ideal scenario would be exactly 0% inflation however the tools for mananging an economy are not that precise so low persistent inflation is the only thing which we can target



EXACTLY. Which makes slapping a massive inflationary tarifff on just about everything utterly horrific. We are not out of the woods and now Trump wants to light the woods on fire.



That is incorrect. Wages are growing in real terms NOW. However there are 3 years of PAST price increases where wages had negative real growth. The current trajectory is positive though and if it continued it would dig out of that hole. We can't undo the past. Right now is the best that can happen. We have positive real wage growth which means budgets will get easier in time ... IF things remain the same.



It is when you don't have a paycheck to erode.

Deflation was not so bad in the 1930's, was it?

 

[Spalls]

Lets cut to the chase and call foreigners what they are: ENEMIES!
Make it illegal to do business with them.
BUILD THAT WALL!

do I need to add an /s?

Sadly, yes. You saw who the Americans voted for. Too many of them BELIEVE this stuff.

 

[Ralf The Dog]

I don't think tariffs apply to goods that simply transit through US territory; I'm pretty sure they're only an issue when the goods in question stop in the US.

The problem is, Trump is likely to block the transfer of those goods if he can. If Canada and Mexico are thriving while the United States stagnates at best, Trump will go for revenge, any way he can.

 

[Trentmoller]

So after ramming through an idiotic "NAFTA Replacement" now of course Trump, who doesn't understand the concept of rules or treaties or keeping one's word, intends to penalize our two biggest trade partners in violation of that agreement for ... not keeping OUR borders secure? Isn't that OUR job?

 

[Victor Bitu]

Trump made a lot of promises.Very few respected.Let's see if he actually follows through.

 

[SixDegrees]

Smoot-Hawley 1930s. What happened to semi-qoute a poster, is we threw knives at everybody and then they threw them back. Both Smoot and Hawley were Republicans. FDR helped a great deal but WW2 industrialization was what finally got us back.

Yes there is stuff "made" here but some of those parts come from somewhere else. Produce out of season comes from south of the border. I still remember Trump's bully boys letting truckloads of avocados rot. Take a look at your local supermarket's shelves of canned goods and see where they come from. Coffee and tea don't grow here.

It's going to suck. I voted Harris but she didn't win. Take a hard look and see if those appliances will last four more years. Will that car keep going? How's the roof and the HVAC? Start looking at debt.

For stuff that's made domestically, prices will rise to match the tariff-induced higher price of imports. Also, for both higher-priced items and for items not produced domestically, people will look at the price and...simply decide to do without.

 

[johnnoi]

I'm sure my $200 'stimulus' check will help me buy a house and offset any cost increases to me by added tariffs. Right? Now all he needs to do is turn the knob so gas prices go down, and I'm good to go!

With 25% tariffs on Canadian crude and power that ain't gonna happen.

 

[SixDegrees]

So is there any plus side to across-the-board imposition of high tariffs? Will it reduce the number of companies with randomly generated names without any vowels I see on Amazon, all selling identical products?