President Trump's first week in office was an elephant short of a circus. Riots in the streets, marches around the globe, new Oval Office curtains...and now, a rumored 20 percent tax on imported goods, beginning with Mexico. President Trump has appeared to embrace a proposal by House Republicans that imposes this tax, using the profits to pay for his border wall, estimated as high as $20 billion. While White House press secretary, Sean Spicer, states the plan is just one of many options, the avocado lovers, and economists, in the States are outraged.
The United States relies on Mexico for "big ticket" imports. Among these items? Alcohol, fresh produce, and car parts. In 2015, the U.S. imported $295 billion worth of products from its southern neighbor.
This plan would sharply increase the price of imported goods, diminishing hope and reducing profits for the companies that produce the same goods. It would not be the Mexican companies that would suffer, but the American retailers who would distribute the products. Worse case scenario, other nations could retaliate and we may end up in the middle of a trade war. This would result in bad news all around. As Carl Weinberg, chief economist for High Frequency Economics, stated in his analysis of the issue, "Trade wars are bad. Tariffs are bad. Nobody wins when trade barriers go up."
For the love of chips and dip, can the American people not catch a break?
Tensions between President Trump and Mexican President Pêna Nieto have been on edge for months. Wednesday's immigration and border decisions from President Trump were the icing on the cake, pushing Mexican leadership to confront President Trump on his favorite battlefield -- Twitter.
President Trump's longtime claims concerning Mexico paying for the border wall have quickly turned into a "no duh" issue. Did he really think they would willingly take money out of their nation's budget to put up a wall? President Pêna Nieto was quick to call the wall a sign of disunity, a symbol that would "further divide" the two countries.
While the concept of the wall may have initially seemed like a far-off idea, President Trump is moving forward. He does not appear to be fazed by criticism, backfires, or a lack of Mexican collaboration. All in all, it appears as though his plan is placed above all other considerations -- including the American people's wallets.
Would you want to deal with angry Americans when taco Tuesday is short on tequila? I wouldn't, and I'm not sure President Trump would either. Perhaps before he taxes all things good, he ought to think about the repercussions. Eat your avocados while you can, we may be entering a dry spell.