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Trump’s Mexico Tariff Still has U.S. Taxpayers Footing the Bill

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It would seem President Trump has a solution to his funding problem for the wall. Trump’s answer, as it seems to be with any country who doesn’t immediately agree with him, is to suggest a Mexico tariff. But that may not be such a good idea – especially with our neighbor to the south. And who really gets stuck paying for the wall if he does?

Why Should Trump Hesitate to Put a Tariff on Mexican Imports?

Donald Trump can’t just approach everything with the threat of a tariff. Especially as a source of funding. Mexico is a major trade partner for the U.S. In fact, Mexico is America’s third largest supplier of imported goods. Last year, that trade totalled to the U.S. importing $295 billion in goods from Mexico. Yes, a 20 percent tariff would generate an additional $59 billion for the country. The only problem there? That cost doesn’t go to Mexico, but gets passed onto the American consumer.

#1 Why Should Trump Hesitate to Put a Tariff on Mexican Imports? | Trump's Mexico Tariff Still has U.S. Taxpayers Footing the Bill

Mexico’s major import categories include vehicles, electrical machinery, fuel, and medical instruments. On top of that, Mexico is our second largest supplier of agriculture, including fresh fruits and vegetables. A tariff could make a lot of these imports unaffordable to many Americans, leaving the country worse off than before, and still having to pay for its own wall.

Trump’s tariff idea came up after Mexican President Enrique Peña Nieto canceled a scheduled meeting with the US president after Trump signed an executive order Wednesday to expedite the building of his border wall and Trump’s promise to have Mexico to pay for it. Once Nieto swore there’s no way Mexico would pay for any wall, Trump promised they would — in some form. But after concern from both sides of the aisle about the tariff, Trump’s press secretary backed off the tariff, claiming it was just one option out of several the administration is considering. Spicer refused to acknowledge that the tariff would affect American consumers, and solely focused on the tax’s benefits for American workers.

#2 Why Should Trump Hesitate to Put a Tariff on Mexican Imports? | Trump's Mexico Tariff Still has U.S. Taxpayers Footing the Bill

But any way you look at it, a tariff on Mexico is a bad idea. That would instantly start a trade war with our third largest trade partner, hurting only American consumers and potentially driving up national debt in the process.

A possible solution?

Trump might want to actually restructure NAFTA instead of withdrawing from it, as both Republicans and Democrats alike are encouraging him to do.

Here’s a news report from CNN on really paying the US-Mexico wall:

After all, as Sen. Lindsey Graham tweeted, “…any policy proposal which drives up costs of Corona, tequila, or margaritas is a big-time bad idea.”

 

For more news on Trump’s wall, click here!

 

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11 Comments

11 Comments

  1. Avatar

    RevIdahoSpud3

    January 27, 2017 at 10:54 AM

    Americans are ALREADY paying for it! Schools, hospitals, social services, crime, mayhem, murder, just about have the US taxpayers belly up. Building a wall may hurt US citizens but the pain will be more akin to a headache than the heart attack we are having now!

  2. Avatar

    geneww1938

    January 27, 2017 at 11:08 AM

    Trump’s team is brilliant and building the Border Wall is the smartest and greatest investment ever made by the USA government.!!! Forget repayment by Mexico and ignore a tax. Besides the carnage from drug pouring in, look at these costs.
    The 2011 Martin & Ruark “The Fiscal Burden of Illegal Immigration on US Taxpayers” “estimates the annual costs of illegal immigration at the federal, state and local level to be about $113 Billion; nearly $29 Billion at the federal level and $84 Billion at the state and local level”.
    Today’s and future costs are significantly greater. The $113 Billion did not include the cost of humans and illicit drugs trafficking, lost citizen’s wages, the society’s drug users and crime victims nor positive benefit factors as less crime from repeat deported criminals, safer streets and communities.
    The recent MIT and the anti-Trump Washington Post’s fact checker estimated the wall cost could be as high as $25 to $41 Billion for the entire border length.
    Reducing the annual costs by 10%, the worse-case Wall Cost would be repaid within 2 to 4 years !!!
    When did any government (or any financial adviser) make an investment with a 25% to 50% return within the first year followed by that annuity for life?
    It would be just a bonus if Mexico made any repayment

    • Avatar

      Kevin Watson

      January 31, 2017 at 12:57 PM

      When you remove a parasite, it’s mere removal is enough…. the rest will take care of itself.

  3. Avatar

    Kevin Watson

    January 27, 2017 at 1:38 PM

    “Cheap” goods from Mexico don’t help much when the US consumer can’t get a job.

    “Cheap” products that break quickly, especially cars, do NOT help the US economy at all.

    We need to stop using Mexico and other countries as slave labor.

  4. Avatar

    brucefandrews

    January 27, 2017 at 3:13 PM

    Donald Trump is a pragmatist and doesn’t do something that will cause problems somewhere
    else. He already has a plan to make sure that the expense does not come back on us. For one the money that is confiscated from drug dealers can be a source. Another source id to take all the bank accounts from the illegal Mexicans and their families. (If it can be proven that any moneys in other family’s bank accounts are connected to the illegal). Take all moneys from human traffickers. Take all money that can be connected to illegal activities between Americans and Mexicans. ETC and so on. Not only pay for the wall but have a large amount left over to pay back Americans for that money that congress stole from our Social Security.

  5. Avatar

    Kbuzz

    January 27, 2017 at 3:30 PM

    Tariffs hit the consumer, that means the US people will be paying the tariff – True, or it could also mean the Consumer won’t BUY the product…which in turn means the producer can’t sell the product because there is no market. Producer has to fire people or go out of business, which means he won’t be paying taxes to his government. Loss of revenue means social programs suffer as well as kick-backs to corrupt mexican politicians.
    Trump knows exactly what he is doing.

    • Avatar

      Kevin Watson

      January 31, 2017 at 12:58 PM

      I’ll keep my money a lot longer than they’ll keep produce….

    • Avatar

      Chewbacca Solo

      January 31, 2017 at 4:13 PM

      Yes he has the economics degree, unlike politicians. Watch who fights him through his entire term, All establishment related…

  6. Avatar

    Steven Coy

    January 27, 2017 at 6:55 PM

    ARE YOU PEOPLE SAYING THAT YOU CAN’T BUY OTHER COUNTRIES PRODUCTS?? I DON’T BUY FRUITS AND VEGETABLES FROM MEXICO SO I DON’T CARE AND AS FAR AS CARS I DON’T BUY THEM FROM MEXICO EITHER. IF WE STOP ILLEGAL ALIENS FROM COMING INTO THIS COUNTRY AND STOP THE DRUGS AND DEPORT THE 30-40 ILLEGAL ALIENS BACK TO WHERE EVER THEY CAME FROM WE TAX PAYERS WILL GET A $60 BILLION BOOST FROM THE NEGATIVE TRADE AND $1 TRILLION DOLLARS FROM THE COST OF SUPPORTING THE ILLEGAL ALIENS EVERY YEAR AND IT WILL GIVE AMERICAN WORKERS 13-15 MILLION JOBS THAT THEY NOW ARE WORKING!!! ALSO THIS SO CALLED , THEY ARE PAYING TAXES!!!! YOU FORGET MOST OF THESE ILLEGAL ALIENS ARE IN POVERTY INCOME AND THEY GET ALL THE TAX MONEY BACK AND THEY GET FOOD STAMPS STATE AID HOSPITALIZATION SCHOOLING AND A BONUS TAX REFUND THAT HAS BEEN IN THE $20 BILLION RANGE SO THEY DO NOT PAY TAXES AND COST US TO BUILD MORE SCHOOLS HOSPITALS PRISONS POLICE AND THEY HAVE MURDERED OVER 18,000 AMERICANS SINCE 9/11 THAT WE KNOW OF. THIS IS A WIN WIN FOR US AND THEY WILL CAVE AND WE WILL WIN!!! STOP WHINING AND LET TRUMP DO SOMETHING AND SEE WHAT HAPPENS, IT IS NOT GOING TO BE ANYWHERE AS BAD AS WHAT WE HAVE WITH 8 YEARS OF THE ILLEGAL NOT BLACK HALF BREED MARXIST SUNNI MUSLIM TREASONOUS TRAITOR WHO HAS BURRIED US IN $9.3 TRILLION IN NEW NATIONAL DEBT, RUINED OUR HEALTH CARE WITH OBAMINATIONS UN-AFFORDABLE DEATH CARE THAT YOU DEMO-RATS/MARXISTS/MUSLIMS NEVER READ BEFORE PASSING, DOUBLED POVERTY, DOUBLED FOOD STAMPS, STARTED ISIS, MADE UP A STORY WITH THE ESPIONAGE AGENT HITLERY ABOUT WHAT HAPPENED IN BENGHAZI AND LET 4 AMERICANS GET MURDERED BY THE IGNORANT CULTIST TERRORIST MUSLIMS AND DON’T FORGET THE IRS SCANDAL, THE RAISING OF OUR TAXES EVERY YEAR FOR 8 YEARS AND THE BAILOUT OF WALL STREET, BIG BANKS AND INSURANCE COMPANIES THE RICHEST CORPORATIONS IN THE WORLD AND NOW THE BANKS ARE IN WORSE SHAPE THAN EVER BEFORE BY 4 TIMES AND ARE ON THE VERGE OF COLLAPSING AND THEY OWE SO MUCH WE CANNOT BAIL THEM OUT AGAIN,AND LASTLY DON’T FORGET YOU LIBERALS OBAMINATION AND HITLERY SOLD ALL THE TERRORIST NATIONS IN THE WORLD OVER $120 BILLION DOLLARS IN ARMS, MUNITIONS FIGHTER JETS AND OUR HAND HELD ROCKET LAUNCHERS!!!! VIETNAM VET

  7. Avatar

    lark2

    January 27, 2017 at 10:04 PM

    Why don’t you just shut up and wait until the administration negotiates things that need to be negotiated. Of course Mexican President Nieto is under pressure at home. He has the FORMER president saying …… “I am not going to pay for that Fu . cking wall “. It’s like OBAMA saying “I am not going to allow any wall”. By running your mouth in ignorance you intend only to obstruct. You are making a case for the administration to act in secret so that they can do the job that needs to be done. The Obama people just operated in secret … they called it “benefiting from a lack of transparency”. You want the Trump people to quote “chapter and verse” so you can explode every day. This is going to lead to SILENCE … then you will complain about the silence.

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Economy

The U.S. Was Already Deep in Debt. This Year’s Deficit will be ‘Mind-Boggling’

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The U.S. was already deep in debt. This year's deficit will be 'mind-boggling'

Over the years, the federal government has spent trillions of dollars more than it brings in, wracking up big deficits even in good times, when it ought to be paring debt down.

Now, as it struggles to repair the damage from the coronavirus epidemic, it’s getting ready to spend trillions more, pushing up this year’s deficit above $3 trillion.

“It’s mind-boggling. I never contemplated this,” says Douglas Holtz-Eakin, president of the American Action Forum, who headed the Congressional Budget Office under President George W. Bush.

“I can remember the quaint days when I was being yelled at because we had a $400 billion deficit and I was the CBO director. It doesn’t look so bad right now,” he says.

The economic rescue package approved by Congress and signed into law by President Trump contains $2 trillion in tax breaks and loan guarantees, throwing much-needed lifelines to troubled airlines, small businesses, hospitals, medical supply companies and municipal governments.

And more money will almost certainly be needed in the weeks to come, as the pandemic progresses.

“We are talking about massive amounts of money compared to anything we’ve ever done in this amount of time before,” says Maya MacGuineas, president of the Committee for a Responsible Federal Budget.

At one time, such huge levels of deficit spending set off alarm bells in Washington, where politicians such as Senate Majority Leader Mitch McConnell routinely bemoaned the lack of fiscal discipline in government.

In 2013, when the country was still recovering from the Great Recession, McConnell told CBS News: “We now have a debt of $16.4 trillion. That’s as big as our economy. That alone makes us look a lot like Greece. We have an incredible spending addiction.”

Today, the total amount owed by the federal government is about to top $25 trillion, and McConnell barely talks about it. Neither does President Trump, who has presided over a rapid increase in debt, thanks to the massive 2017 tax cuts and a big increase in defense spending.

Part of this is just raw politics, says Dean Baker, co-founder of the Center for Economic and Policy Research. Politicians tend to focus more on deficits when the other party controls the White House.

But Baker says the past few years have also brought a transformation in the way economists think about deficits.

Once, conventional wisdom said that too much federal borrowing would drive up interest rates, leading to higher inflation and reduced productivity, Baker says. But debt has soared in recent years, and interest rates are lower than ever, he notes.

“The classic story of why deficits are bad just hasn’t panned out,” Baker says.

He is among many economists now arguing that the quick collapse of the economy and the surge in layoffs is so serious that deficit concerns should be set aside.

“The amount of employment in the economy is going through the floor. And the deficit in that context … it’s almost a non sequitur. That’s not the sort of thing you should worry about,” Baker says.

Even MacGuineas, who’s something of a deficit hawk, agrees, saying times like these are precisely when the government needs to run deficits. But she says the government is that much less prepared to deal with the crisis because of deficits run up in good times, when it should have been paying off what it owed.

“It makes sense to borrow from the future today. We have a real emergency. But it also makes it harder for us to get our economy back on track once we get through this emergency,” MacGuineas says.

Copyright 2020 NPR. To see more, visit https://www.npr.org.

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Economy

Stocks Plunge Again, Jobless Claims Surge to New Record

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Stocks Plunge Again, Jobless Claims Surge to New Record

The stock market started the second quarter the same way the first quarter ended, with significant losses across the board.

The Dow Jones Industrial Average, S&P 500 and Nasdaq all slid 4.4% yesterday as investors braced for more bad news about the spread of the coronavirus and historical jobless claims due to the outbreak.

President Donald Trump warned that a “very, very painful” two weeks lie ahead for the country as it faces a rapidly spreading COVID-19 outbreak that is approaching 200,000 cases here in the US.

With uncertainty over how long the country will be shut down in an attempt to slow the spread of the virus, it’s becoming virtually impossible to predict how the market will perform going forward.

“Everything hinges on how long we are in this shutdown,” said Anwiti Bahuguna, head of multi-asset strategy at Columbia Threadneedle Investments, in an interview. “We don’t know how long the shutdown may last, so it’s hard to predict what U.S. growth will look like.”

Adding to the misery on Wall Street, this morning’s initial jobless claims report showed that a record 6.6 million Americans filed for unemployment insurance last week.

That dwarfs the then-record 3.3 million new filings reported two weeks ago, and brings the total claims to nearly 10 million in the last two weeks due to the coronavirus outbreak.

For comparison, today’s numbers were almost 10 times higher than any previous report prior to the coronavirus outbreak.

Excluding the last two weekly reports, the highest week for claims was 695,000 in 1982. And as miserable as the job market was during the Great Recession, the highest number of jobless claims during that period was 665,000 in March 2009.

“We’ve lived through the recession and 9/11. What we’re seeing with this decline is actually worse than both of those events,” said Irina Novoselsky, CEO of online jobs marketplace CareerBuilder.

The lone bright spot in the markets is oil, as the price surged 10% after President Trump mentioned the possibility of a truce in the price war between Saudi Arabia and Russia.

West Texas Intermediate (WTI) futures jumped $2.11/barrel to $22.42 on the seemingly good news.

“Worldwide, the oil industry has been ravaged,” Trump said during a media conference on Wednesday. “It’s very bad for Russia, it’s very bad for Saudi Arabia. I mean, it’s very bad for both. I think they’re going to make a deal.”

Trump added he expects both countries to end their price war within a “few days” meaning they will slow production and bring prices back up.

The president also invited the heads of US oil companies like Exxon Mobil and Chevron to meet with him at the White House to potentially discuss how Washington can help the companies get through the current crisis as they face bankruptcies and massive layoffs.

“I’m going to meet with the oil producers on Friday. I’m going to meet with independent oil producers also on Friday or Saturday. Maybe Sunday. We’re going to have a lot of meetings on it,” he added.

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Economy

Next Wave of Stimulus Could Be $2 Trillion Infrastructure Bill

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Next Wave of Stimulus Could Be $2 Trillion Infrastructure Bill

“Phase 4” of the government’s economic stimulus plan could include spending up to $2 trillion on improving America’s infrastructure.

The bill already has bipartisan support, and could be voted on as soon as April 20th when representatives of both the House and Senate return to Washington, D.C.

During his 2016 campaign, President Trump said he would make improving America’s roads, bridges and airports a top priority during his time in office.

“The only one to fix the infrastructure of our country is me – roads, airports, bridges,” Trump tweeted on May 12, 2015. “I know how to build, [politicians] only know how to talk!”

While previous attempts to pass a major infrastructure bill have failed, both sides seem willing to try again in an effort to help America’s economy rebound from the coronavirus outbreak.

House Speaker Nancy Pelosi, who is often at odds with the President, said she is “pleased the president has returned to his interest” in the issue. She called an infrastructure proposal “essential because of the historic nature of the health and economic emergency that we are confronting.”

She added “I think we come back April 20, God willing and coronavirus willing, but shortly thereafter we should be able to move forward.”

The Democrat’s proposal is part of a five-year, $760 billion package that includes money for community health centers, improvements to drinking water systems, expanded access to broadband and upgrades to roads, bridges, railroads and public transit agencies.

The plan designated $329 billion for modernizing highways and improving road safety, including fixing 47,000 “structurally deficient” bridges and reducing carbon pollution. It also aimed to set aside $105 billion for transit agencies, $55 billion for rail investments such as Amtrak, $30 billion for airport improvements and $86 billion for expanding broadband access.

“I could provide the legislative language in very, very short order for this package. It’s the funding that’s been holding us up, and if the president insists on funding, then I believe that Senator McConnell and Leader McCarthy will move on this issue,” said Democratic Rep. Peter DeFazio of Oregon, who chairs the House Transportation and Infrastructure Committee.

During an appearance on CNBC yesterday, Treasury Secretary Steven Mnuchin said he is talking with Congress about a potential infrastructure bill.

“As you know, the president has been very interested in infrastructure. This goes back to the campaign: The president very much wants to rebuild the country. And with interest rates low, that’s something that’s very important to him.”

He added “We’ve been discussing this for the last year with the Democrats and the Republicans. And we’ll continue to have those conversations.”

Earlier this week President Donald Trump said he wants to spend $2 trillion on a massive infrastructure package.

He tweeted that “With interest rates for the United States being at ZERO,this is the time to do our decades long awaited Infrastructure Bill. It should be VERY BIG & BOLD, Two Trillion Dollars, and be focused solely on jobs and rebuilding the once great infrastructure of our Country! Phase 4.”

“The president very much wants to rebuild the country, and with interest rates low, that’s something that’s very important to him,” Treasury Secretary Mnuchin added.

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