President Donald Trump declared on Thursday that he would impose a 5 percent tariff on all goods entering from Mexico unless it stopped the flow of illegal immigration to the United States. The move would set a dangerous precedent of mixing trade and immigration issues — further destabilizing the economy and isolating the United States. If this unprecedented move is based on the National Emergency Act, it would again push the law to its extremes. Yet, as I have previously written on the controversy over the wall construction, Congress unwisely gave presidents sweeping and largely unchecked authority.
The use of a tariff in this circumstance is deeply troubling from both a legal and policy standpoint. Trump is using trade to punish a country for a global problem of migration. Political, economic, and social forces all play a role in such movement. It is certainly valid to object to steps that countries like Mexico can do to prevent illegal crossings. However, Trump in the past has suggested that countries should effectively close their borders or restrict travel within their borders — moves that raise a host of legal and constitutional issues for those countries. Mexico has increased deportations by 300 percent but that has not stemmed the flow into the United States anymore than the United States has been successful in stopping them at the border.
The tariffs will kick in on June 10th and continue to ratchet-up higher until immigration is slowed. We are already in a worsening trade war with China, this could trigger another serious drag on our economy. Moreover, the fight with China has some legitimate elements. It is true that past presidents have utterly failed to deal with the trade deficit and that China has been a bad actor in the theft of intellectual property and the imposition of trade barriers. This is different. This is using trade to punish a countries for the unlawful actions of individuals across a long and largely guarded border.
What is also concerning is the return to impulse or improvisational policies. Once again White House officials seemed caught by surprise and there seems little foundation laid for this major change. Certainly Congress appeared largely unconsulted and Republicans have already come out in opposition. Like the first travel bans, this major diplomatic and economic move had little preparation or planning. Vice President Pence was in Canada on Thursday with Canadian Prime Minister Justin Trudeau to discuss the ratification of the North American Free Trade Agreement with Mexico. This appeared to catch everyone by surprise and could not compromise those plans.
This is an area where Congress needs to act quickly and clearly to reverse this action. I am admittedly someone who is critical of tax and tariff policies being used for such broader policy goals. With the rising costs associated with the China trade war, this will take a bite out of consumer. Mexico exported $346.5 billion in goods to the United States in 2018. It will also do little to stop illegal immigration and could easily trigger a tit-for-tat trade war with Mexico. It is a uniquely bad idea in my view.
What do you think?