It’s Complicated

The WaPo recently reported on Trump’s latest attempt to squirm out of his impossible campaign promise to build a wall on the Mexico-U.S. border paid for by Mexico. It is equal parts clown action and cynical maneuvering.

An import tax is pure clown action because any tax that we impose Mexico can as well in retaliation. They are a sovereign nation able to levy any taxes they wish. And they’ve said that they will do exactly that and even go beyond. According to the WaPo:

Mexico’s economy secretary, Ildefonso Guajardo, said this week that Mexico is prepared to “mirror” any action by the United States to raise tariffs or impose taxes on imports. Guajardo has also said it might be necessary for Mexico to walk away from NAFTA — a once-unthinkable idea — if there was no benefit in the negotiations for his country.

And it’s not like we are immune to such retaliatory action:

Every day, goods valued at $1.4 billion cross the U.S.-Mexico border, and millions of jobs are linked to trade on both sides. Mexico is the world’s second-largest customer for American-made products, and 80 percent of Mexican exports — automobiles, flat-screen TVs, avocados — are sold to the United States.

So that $600 flat screen will now cost the American customer $720. That’s $600 plus $120 to pay the 20% import tax Trump imposed. After all is Best Buy or the TV manufacturer going to eat that cost? No. We are. And not just at the cash register. Try American jobs as well. Which brings me to the cynical maneuvering part of this story.

Trump knows damn well Mexico will not pay an import tax. Americans will. Sure such a tax hurts Mexican exports but Mexico can do much of the same damage to us. That’s why no one wins in a trade war, except perhaps the tax man, surely a high GOP priority. With Americans paying the import tax, Trump is attempting to bamboozle his supporters into thinking Mexico is paying for the wall in a “complicated form.” And like any con, the mark is always the only one who pays. Unfortunately, because marks can vote, we are along for the ride.

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