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Economic Strategies and Consequences

Writer's picture: Alyssa DanielsAlyssa Daniels

Yesterday, President Donald Trump and President Claudia Sheinbaum of Mexico agreed to delay tariffs set to take effect this morning. Trump had planned to impose a 25 percent tariff on goods from Mexico, although many questioned if he would follow through with it. Some individuals worried about the impact on U.S.-Mexico relations, while others believed Trump was bluffing. After Sheinbaum agreed to send 10,000 troops to the southern border, Trump postponed the tariffs for one month. The troops' goal is to minimize the number of migrants crossing the border, as well as to combat illegal drug and gun trafficking. 

Claudia Sheinbaum, President of Mexio.
Claudia Sheinbaum, President of Mexio.

Trump also had a call with Prime Minister Justin Trudeau and delayed tariffs on Canada for a month. Trudeau agreed to help cooperate in fighting fentanyl smuggling across the border as well as money laundering. 


While Mexico and Canada have reached an agreement, China is still expected to have tariffs imposed. Karoline Leavitt noted in a press briefing that Trump has agreed to a 10 percent tariff on China due to the "illegal fentanyl that they have sourced and allowed to distribute into our country". Trump has partly blamed China for the flow of fentanyl into the U.S. as well as supplying it to known criminal cartels and organizations. China's ambassador, Fu Cong, has opposed the 10 percent tariff and claimed, "We do believe this is in violation of W.T.O. rules." and stated they would be filing a complaint with the World Trade Organization. 


Today, Canada was expected to face a 25 percent tariff on goods until a last-minute deal was made late Monday, February 3rd, between Trump and Trudeau. Trump cited illegal immigration from Canada and fentanyl as reasons for the tariffs, though research contradicts this. Economists have agreed there is an apparent problem of fentanyl coming through the southern border, but that is not the case in Canada. Prime Minister candidate Chrystia Freeland said, "This is an act of economic warfare." Before a deal was met, Canada had planned to retaliate and place a 25 percent tariff on U.S. goods. This means in the coming weeks, Americans could have expected an increase in the prices of many everyday necessities if a deal had not been made. Canada had also planned to stop providing internet services in certain areas and prohibit the sale of American liquor in its stores. 

Prime Minister Justin Trudeau announcing Canada's retaliatory tariffs on America.
Prime Minister Justin Trudeau announcing Canada's retaliatory tariffs on America.

Some individuals have criticized Trump for blaming the increased tariffs on the fentanyl crisis, others thinking this is the most crucial reason for said tariffs. Customs and Border Protection states this is a more serious issue than most people think. In the past year, there has been enough fentanyl accounted for crossing our border to potentially "kill more than 4 billion people". Without stricter tariffs, this number will likely increase. 


Trump believes in putting America first and reducing outsourcing. While producing goods domestically can be beneficial, it is often cheaper to produce them elsewhere. Critics on the left have warned Americans of the adverse short-term effects of imposed tariffs. Trump has acknowledged how these tariffs may cause Americans "a little pain" but believes it will be worth it in the long run, pointing out America's enormous trade deficits in almost every country. His efforts will help push for a more sustainable economy in the long run, where we can rely less on other countries. 


The tariffs aim to punish other countries that have taken advantage of America. Mexico and Canada's compliance shows that tariff threats can be effective. This approach could lead to greater respect for American-produced goods in the long run. The tariffs would not be in place forever, but only until other countries started to support the U.S. in efforts to reduce the fentanyl flow, illegal immigration, and money laundering.


Trump is playing chess, a game America has a good history of winning due to its strong economy, which has been proven this week by his stubborn stance. This is one of the first steps Trump takes while back in office to show the strength of America. The past four years have made America into a laughingstock. Other countries saw the U.S. as weak, so we have been exploited. Trump has been able to start pushing America back to being the powerhouse it previously was by convincing Mexico and Canada to strike deals with him.





Photo Credit:

[1]-Al Jazeera

[2]- Stephania Corpi/Bloomberg via Getty Images

[3]-France24

Sources:

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