Trump tariff plan for Mexico could doom Texas, say experts
Posted on 12/02/2024
Last Monday on the website Truth Social, President-elect Donald Trump made clear his intention to impose a substantial tariff on products imported to the United States from Canada and Mexico. Trump announced his tariff plan after alleging that "thousands of people are pouring through Mexico and Canada, bringing Crime and Drugs at levels never seen before."
"On January 20th, as one of my many first Executive Orders, I will sign all necessary documents to charge Mexico and Canada a 25% Tariff on ALL products coming into the United States, and its ridiculous Open Borders," Trump wrote. He also announced imposing an additional 10% tariff on goods from China.
A 25% tariff on products coming from Mexico could disastrously impact the Texas economy, say some economists, according to Newsweek.
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"Because of its proximity to and integration of supply chains with Mexico, Texas would see a disproportionate impact [from the tariffs], which we estimate to be about $46.9 billion in yearly gross state product (about 1.7 percent of the total) and approximately 370,000 jobs," The Perryman Group CEO Ray Perryman told Newsweek. Perryman, a financial analyst, said the U.S. economy would lose about $250.6 billion in annual gross domestic product (GDP) and 1.97 million jobs.
The price of staple products imported from Mexico would be the first impacts everyday Americans might spot, including avocados, beer and tequila. If Trump were to impose the tariffs upon his Jan. 20 inauguration, said CNN, it could hit the avocado industry at a peak: right around Super Bowl Sunday, when Americans consume bowl after bowl of guacamole. According to the Center for Biological Diversity in a 2024 article, Americans eat around 304 million pounds of avocados. Plus, 80% of all beer imported to the U.S. comes from Mexico.
Moreover, because it shares a border with Mexico, Texas is also poised to suffer from imposed tariffs experts say because of a reduction in traffic and cross-border business. According to Gov. Greg Abbott's office, Texas and Mexico trade totaled $272.3 billion in 2023, and Mexico accounted for $142.7 billion in importing to Texas. Mexico has been Texas' top trading partner for at least the last 16 years consecutively. Top imports from Mexico to Texas include nuclear reactors and related parts, electric machiner including TV equipment, and vehicles and vehicle parts.
On that note, Mexican Secretary of Economy Marcelo Ebrard recently said if the 25% percent tariff was imposed, the price of pickup trucks imported from Mexico would increase by $3,000, on average.
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Trade between Texas and Canada totaled $71.3 billion in 2023, making the Great White North Texas' second-largest trade partner behind Mexico. Major imports include mineral fuel and oil, vehicles and vehicle parts, and nuclear reactors and related parts.
But some Texas Republicans believe the tariff plan will be effective as a threat directed to Mexico. Sen. Ted Cruz said Sunday on CBS News' Face the Nation that Trump's announcement on Truth Social "immediately has produced action."
"We've seen the president of Mexico stand up and promise that she is going to work hand-in-hand with the president of the United States, President Trump, to secure the border," Cruz said. "This is about using leverage to get Mexico and Canada to cooperate."
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"On January 20th, as one of my many first Executive Orders, I will sign all necessary documents to charge Mexico and Canada a 25% Tariff on ALL products coming into the United States, and its ridiculous Open Borders," Trump wrote. He also announced imposing an additional 10% tariff on goods from China.
A 25% tariff on products coming from Mexico could disastrously impact the Texas economy, say some economists, according to Newsweek.
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Article continues below this ad
"Because of its proximity to and integration of supply chains with Mexico, Texas would see a disproportionate impact [from the tariffs], which we estimate to be about $46.9 billion in yearly gross state product (about 1.7 percent of the total) and approximately 370,000 jobs," The Perryman Group CEO Ray Perryman told Newsweek. Perryman, a financial analyst, said the U.S. economy would lose about $250.6 billion in annual gross domestic product (GDP) and 1.97 million jobs.
The price of staple products imported from Mexico would be the first impacts everyday Americans might spot, including avocados, beer and tequila. If Trump were to impose the tariffs upon his Jan. 20 inauguration, said CNN, it could hit the avocado industry at a peak: right around Super Bowl Sunday, when Americans consume bowl after bowl of guacamole. According to the Center for Biological Diversity in a 2024 article, Americans eat around 304 million pounds of avocados. Plus, 80% of all beer imported to the U.S. comes from Mexico.
Moreover, because it shares a border with Mexico, Texas is also poised to suffer from imposed tariffs experts say because of a reduction in traffic and cross-border business. According to Gov. Greg Abbott's office, Texas and Mexico trade totaled $272.3 billion in 2023, and Mexico accounted for $142.7 billion in importing to Texas. Mexico has been Texas' top trading partner for at least the last 16 years consecutively. Top imports from Mexico to Texas include nuclear reactors and related parts, electric machiner including TV equipment, and vehicles and vehicle parts.
On that note, Mexican Secretary of Economy Marcelo Ebrard recently said if the 25% percent tariff was imposed, the price of pickup trucks imported from Mexico would increase by $3,000, on average.
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Trade between Texas and Canada totaled $71.3 billion in 2023, making the Great White North Texas' second-largest trade partner behind Mexico. Major imports include mineral fuel and oil, vehicles and vehicle parts, and nuclear reactors and related parts.
But some Texas Republicans believe the tariff plan will be effective as a threat directed to Mexico. Sen. Ted Cruz said Sunday on CBS News' Face the Nation that Trump's announcement on Truth Social "immediately has produced action."
"We've seen the president of Mexico stand up and promise that she is going to work hand-in-hand with the president of the United States, President Trump, to secure the border," Cruz said. "This is about using leverage to get Mexico and Canada to cooperate."
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