A group of immigrants from Honduras and El Salvador who crossed the U.S.-Mexico border illegally are loaded on to a van, Wednesday, June 25, 2014, in Granjeno, Texas. At least six local, state and federal law enforcement agencies patrol the five mile zone which is illegal immigrations busiest corridor. (AP Photo/Eric Gay)
Last week, President Trump set off a firestorm by saying he was going to apply tariffs of 5%, escalating to 25%, on Mexico for their failures on the border. Most reactions were negative, with countless media op-eds being churned out amid Republican and Democratic cries that it was taxation of Americans to punish Mexico.
I found some arguments persuasive, others not so much. If we are speaking about tariffs in a vacuum, they are indeed a negative impact on U.S. consumers. Sometimes absorbing a little pain can lead to long term betterment though. Using tariffs as a tool of leverage holds more value than trying to use them as a means unto themselves. Admittedly, Donald Trump has been an incredibly bad messenger on this point, constantly shifting between saying tariffs are to ensure betters deals and saying the tariffs themselves are great for America. It doesn’t work both ways. If the tariffs are great, you don’t need a new deal, but if the purpose is to bring people to the table, then that’s more palatable.
It appears the latest threat was for the latter, as Mexico is now sending a delegation to Washington a week before the new tariffs hit their economy.
MEXICO CITY (Reuters) – Fighting to stave off punitive tariffs announced by U.S. President Donald Trump, a senior Mexican delegation was set to begin high level talks on Monday in Washington, where it will be pushed to do more to hold back Central American migrants.
Here’s a preview of what some of our demands will be.
The U.S.-Mexican talks begin on Monday with a meeting between Mexican Economy Secretary Graciela Marquez and U.S. Commerce Secretary Wilbur Ross. On Wednesday, Ebrard meets U.S. Secretary of State Mike Pompeo.
Trump on Sunday called Mexico an “abuser” of the United States and said he wanted action, not talk. Mexico has signaled it would retaliate to the tariffs, with targets likely to include farm products on Trump supporting states.
In a possible sign of U.S. priorities in the talks, which are due to run through at least Wednesday, Department of Homeland Security (DHS) acting Secretary Kevin McAleenan said on Sunday that Mexico should deploy more personnel to interdict illegal migrants along a 150 mile (241.4 km) stretch of border with Guatemala.
Mexico simply doesn’t have the leverage to retaliate on the needed scale. They are heavily reliant on U.S. exports and their economy has already retracted in the 1st quarter of this year.
I suspect some kind of deal will be reached and announced. Whether it’ll have much teeth, I don’t know. Mexico has the ability to police it’s 150 mile border with Guatemala in a much heavier fashion. By contract to the U.S. border, it’s a tiny fraction of the size. Currently, U.S. DHS agents are already down there in advisory roles. That border will be the key to stemming the flow. If hundreds of thousands of people continue to make it to the expansive U.S.-Mexico border, no amount of enforcement will be viable to stop what’s happening.
There is something to be said about the different schools of thought here. When I first saw these new tariffs announced, my first thought was that some kind of deal would be reached before they even become a factor. If that happens, Trump comes out looking like a winner. If it doesn’t, the economic impact could ultimately harm his re-election. He’s in a game of chicken right now and Mexico looks like it’s willing to blink first.
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