Tariffs, Tariffs Everywhere, Not a Solution Anywhere

Living in Hong Kong, the U.S.-China tariff war is a daily painful dose of reality. The pros and cons on both sides of the Pacific are debated endlessly and will be for quite a while longer. When, and if, the tariffs both countries are imposing on each other have a negative political impact on Trump’s 2020 re-election campaign or the Republican Party remains to be seen. The same holds true for Xi and the Communist Party’s staying power.

I thought the tariff war was behind me when I arrived in Arizona earlier this week. I couldn’t believe my eyes or ears. Here I am going from one tariff war to another — a tariff war with Mexico.

A tariff to curb illegal immigration. The U.S. will start imposing escalating tariffs on Mexican goods on Monday, starting at 5% and climbing to 25%, unless Mexico takes the necessary steps to curb illegal migrants from Guatemala, Ecuador, Columbia, Honduras El Salvador and other Latin American countries from using Mexico as the Highway to Heaven — America.

“There is not much support in my conference for tariffs,” Senate Majority Leader Mitch McConnell said. Republicans in the Senate are breaking ranks with the president. When asked what he thought of the Republican Senators opposing his Mexican tariffs, Trump responded: “I don’t think they will do that — if they do its foolish.”

Tariffs are in fact taxes on foreign goods paid for by Americans.

In early 1921, Congress enacted the Emergency Tariff Act, followed by the Fordney-McCumber Tariff of 1922 that more than doubled average tariffs on imports that created a trade war and a climate of international distrust that many economists attribute to the economic crises of the 1930s.

The National Emergencies Act was signed in 1976 and has never been used to impose tariffs on any country. President Trump’s argument that the illegal immigration crises is an emergency that justifies tariffs is surely to be tested in the courts if imposed.

I’m glad to see the U.S. and Mexico are working to avoid a tariff war. “By what we have seen so far, we will be able to reach an agreement,” Mexican Foreign Minister Marcelo Ebrard said at a news conference at Mexico’s Embassy in Washington. “That is why I think the imposition of tariffs can be avoided.”

Mexican authorities are cracking down on illegal immigration with highly publicized crackdowns on migrant caravans, boarding houses and common routes to the U.S. border. Unfortunately, it is not making much of a dent in the flow of illegals.

Mexico doesn’t have the resources or the will to crackdown on the illegals entering Mexico at the numerous crossing points along its 700-mile border. If there is going to be a wall Mexico pays for, that’s where it should be built.

Migrants seeking asylum in the U.S are now being encouraged to stay and work in Mexico. While there, their asylum requests can be processed there. A cheaper and better way for both the U.S., Mexican and other Latin American countries to spend their tax payers money.

Tariffs is not the solution for Mexico. The threat of tariffs is!