Can Trump make Mexico pay for that wall

[mr friendly guy]

http://www.abc.net.au/news/2017-01-27/h ... rk/8217548

How Donald Trump's plan to pay for Mexico border wall would work

President Donald Trump is promising Mexico will pay for his massive border wall.

On Friday (AEDT), his administration finally suggested how: a 20 per cent tax on products imported from south of the border.

The new measure could be part of a comprehensive tax reform package that Mr Trump and Congress will work out, the White House said. But there was great ambiguity about the proposal.

White House officials later clarified that the tax was one possible way Mr Trump could finance the wall.

Much was left unanswered. Would Mexico be footing the bill or American consumers? What items would become more expensive? Is this even legal?

Here are some of the details Mr Trump's proposal still has to work out:

Is it a tax, a tariff or something else?

It is unclear.

The White House said Congress' tax overhaul would place a 20 per cent tax on imports from any country enjoying a trade surplus with the United States.

In other words, countries selling more goods and service to the US than buying from it. The idea is to rebalance the playing field for US companies by discouraging Americans from importing.

The idea appears to overlap with a plan House Republicans are pushing called "border adjustment". Under this plan, the US would refrain from taxing American companies' exports, but would tax imports.

The new revenues are projected to top $US1 trillion over a decade. The money had been envisioned as an offset for lowering US corporate income tax rates, though House Republicans say it could also pay for a wall.

Mr Trump, however, recently said he did not like the "border adjustment" idea.

What does this mean for Americans?

Mexican products would become more expensive.

That means pricier tequila, but also things Americans need: cars, eyeglasses and many basic groceries.

A Toyota Camry? About $US1,000 more, according to Jim Lentz, chief executive of Toyota North America, noting that a quarter of the car's parts are imported.

US exporters are behind the House plan because it would reduce their taxes.

Here's the flip side: importers, including big retailers and consumer electronics firms, say the higher prices for Mexican products could hurt sales. And that means American jobs.

Retailers such as Wal-Mart also could face higher tax burdens.

Would Mexico really be paying?

Not quite.

The US could recoup some of the wall's costs by changing the tax and trade policies with Mexico. But the money would not necessarily be coming from Mexican taxpayers or the Mexican Government.

While the tax would land first on companies exporting from Mexico, the costs would likely be passed on to consumers. That leaves Americans footing much of the likely bill.

Mr Trump has said he is OK with being "reimbursed" at a later point because he is keen to start building the wall immediately.

Would it raise enough money to pay for the wall?

Probably.

Various estimates put the wall's cost at up to $US15 billion.

House Republicans expect their plan to pull in much more than that in its first year. They say that could easily cover the costs of the wall.

Is it illegal?

To be determined.

The US has a range of obligations under the North American Free Trade Agreement (NAFTA) and at the World Trade Organisation (WTO). And Mexico is likely to challenge any new tax that penalises its economy.

Mr Trump has said he plans to renegotiate NAFTA. Mexico, however, is under no obligation to soften the agreement for his sake.

Other countries may also object, if their products and services are targeted.

Mark Zandi, chief economist at Moody's Analytics, said the border adjustment was essentially a tariff that would be struck down by the WTO if it targeted Mexico.

How would this affect the economy?

A topic of great dispute.

The White House said the plan would increase US wages, help US businesses and consumers, and deliver "huge economic benefits". With so much of the plan ill-defined, it is impossible to substantiate those claims.

Any turbulence in the US-Mexican trade relationship could have implications for the entire world.

Mexico is the second-largest exporter to the United States, after China. The United States imported roughly $US271 billion of goods from Mexico during the first 11 months of 2016, according to the Commerce Department, and ran a trade deficit of almost $US60 billion.

Do Republicans like Trump's plan?

Not all of them.

Republican Justin Amash of Michigan said on Twitter it would be a "tax on Americans to pay for the wall". Senator Lindsey Graham of South Carolina said he was "mucho sad" and that "any policy proposal which drives up costs of Corona, tequila or margaritas is a big-time bad idea".

Even Mr Trump's pick for commerce secretary, Wilbur Ross, dismissed the idea of using tariffs as a trade ploy.

Republicans have traditionally hailed themselves as the party of free trade.

What other ways could Trump get Mexico to pay?

During the campaign, Mr Trump floated a number of possibilities without committing to any in particular.

He proposed changing a rule under the USA Patriot Act to block some of the roughly $US25 billion in remittances that Mexicans living in the US send home each year.

He said he would refuse to free up the money until Mexico agrees to pay the US between $US5 billion and $US10 billion.

Opponents of that plan say Mexicans in the US would likely find other ways to send money back. They could take cash with them when traveling, wire money to a non-Mexican bank or use off-the-books transfers that are difficult to police.

Mr Trump also suggested increasing visa fees for Mexicans to raise money, or cancelling business and tourist visas issued to Mexicans until their country pays for the wall.

[LaCroix]

Calling it a tax won't help - tarrifs are taxes on internationally traded goods. He would run right into NAFTA rulings.

Apart from the issue that it would mean that american customers actually pay that tax.

Also, Mexico could simply turn around and put the their own tax on US trade, to make the situation even worse.

[Ralin]

Well, I suppose he could invade Mexico and literally loot the country of everything lootable until it adds up to the cost of the wall. That would probably qualify as forcing Mexico to pay for the wall.

[Vendetta]

A 20% import tariff on Mexican goods wouldn't be making Mexico pay for the wall, it would be making US companies and consumers that are buying those exports pay for it...

(And of course the inevitable import tariff Mexico imposes on US goods)

[Thanas]

This plan is so stupid I wonder how the hell it ever got written down.

First, it is blatantly illegal unter NAFTA.

Second, the USA has tried in the past to engage in trade wars with various nations (most notably Europe). Not once did it work out well for them.

All this will do is impoverish US consumers.

[The Romulan Republic]

Why would Trump care? Fascists benefit from economic hardship, especially when their's a handy minority to blame it on.

[mr friendly guy]

This plan is so stupid I wonder how the hell it ever got written down.

First, it is blatantly illegal unter NAFTA.

Second, the USA has tried in the past to engage in trade wars with various nations (most notably Europe). Not once did it work out well for them.

All this will do is impoverish US consumers.

Trump's supporters live in an alternate reality. A lot believe he won the popular vote despite evidence to the contrary. They believe Trump would improve Obamacare even though they are fully unaware of any plan on how he is going to do that.

If a trade war started by Trump fucks them over they would convince themselves its not Trump's fault. Must be Mexico's fault instead.

[The Romulan Republic]

Yeah, exactly. He'll just say its Mexico's fault for not bending over and taking it.

[Highlord Laan]

This plan is so stupid I wonder how the hell it ever got written down.

First, it is blatantly illegal unter NAFTA.

Second, the USA has tried in the past to engage in trade wars with various nations (most notably Europe). Not once did it work out well for them.

All this will do is impoverish US consumers.

But it will also allow Il Duce and his sycophants to say they're sticking it to Mexico and making uhmurrica great again. Toss in a few soundbytes and tweets and, violla! Instant mobilization of the mindless hordes that voted for the fuck into believing that he's grabbing the problem by the pussy and showing it who's boss, like a proper murrican should.

Being stupid enough to vote for the motherfucker mean they'll be stupid enough to swallow the bullshit that's going to be peddled for the next four years. The tone of the last week? That's the way this almighty clusterfuck will be going until 2024. Because you know full fucking well the repukes are going to make sure they stay in power.

[LaCroix]

Mexico might even be on the longer arm in such a struggle...

Trade data from https://ustr.gov/countries-regions/americas/mexico

Exports

Mexico was the United States' 2nd largest goods export market in 2015.

U.S. goods exports to Mexico in 2015 were $236 billion, down 1.6% ($3.9 billion) from 2014 but up 97% from 2005. U.S. exports to Mexico are up 468% from 1993 (pre-NAFTA). U.S. exports to Mexico account for 15.7% of overall U.S. exports in 2015.

The top export categories (2-digit HS) in 2015 were: machinery ($42 billion), electrical machinery ($41 billion), vehicles ($22 billion), mineral fuels ($19 billion), and plastics ($17 billion).

U.S. exports of agricultural products to Mexico totaled $18 billion in 2015, our 3th largest agricultural export market. Leading categories include: corn ($2.3 billion), soybeans ($1.4 billion), dairy products ($1.3 billion), pork & pork products ($1.3 billion), and beef & beef products ($1.1 billion).

U.S. exports of services to Mexico were an estimated $30.8 billion in 2015, 2.7% ($807 million) more than 2014, and 36.7% greater than 2005 levels. It was up roughly 196% from 1993 (pre-NAFTA). Based on 2014, leading services exports from the U.S. to Mexico were in the travel, transportation, and intellectual property (computer software) sectors.

Imports

Mexico was the United States' 3rd largest supplier of goods imports in 2015.

U.S. goods imports from Mexico totaled $295 billion in 2015, up 0.2% ($667 million) from 2014, and up 73% from 2005. U.S. imports from Mexico are up 638% from 1993 (pre-NAFTA). U.S. imports from Mexico are up 638% from 1993 (pre-NAFTA).

The top import categories (2-digit HS) in 2015 were: vehicles ($74 billion), electrical machinery ($63 billion), machinery ($49 billion), mineral fuels ($14 billion), and optical and medical instruments ($12 billion).

U.S. imports of agricultural products from Mexico totaled $21 billion in 2015, our 2nd largest supplier of agricultural imports. Leading categories include: fresh vegetables ($4.8 billion), other fresh fruit ($4.3 billion), wine and beer ($2.7 billion), snack foods ($1.7 billion), and processed fruit & vegetables ($1.4 billion).

U.S. imports of services from Mexico were an estimated $21.6 billion in 2015, 11.0% ($2.1 billion) more than 2014, and 50.0% greater than 2005 levels. It was up roughly 191% from 1993 (pre-NAFTA). Based on 2014, leading services imports from Mexico to the U.S. were in the travel, transportation, and technical and other services sectors.

Trade Balance

The U.S. goods trade deficit with Mexico was $58 billion in 2015, a 8.4% increase ($4.5 billion) over 2014.

The United States has a services trade surplus of an estimated $9.2 billion with Mexico in 2015, down 12.7% from 2014.

Such a trade balance development would mean that Mexico can very well live with less imports from the US, but the US consumers needs Mexican imports. They are slowly weaoning off the teat, so to speak.

Just the same, the to be expected drop in demand in the US due to rising prices would mean that prices in Mexico would drop due to oversupply as companies try to sell off overproduction.
If Mexico were to go "Mexico first" and would try to consume increasingly domestic because the better prices (and not wanting to give the US that hates them so much any money), their imports could take a dip, which would deal a crippling blow to the US - the imported goods are more expensive, yet the trade deficit stayed the same.

[aerius]

This plan is so stupid I wonder how the hell it ever got written down.

First, it is blatantly illegal unter NAFTA.

Second, the USA has tried in the past to engage in trade wars with various nations (most notably Europe). Not once did it work out well for them.

All this will do is impoverish US consumers.

Gonna play devil's advocate for a bit.

Trump plans on tearing up NAFTA anyway so the fact that it's currently illegal doesn't matter. Next, the US runs a ~$60 billion trade deficit with Mexico so if the trade shuts down entirely it's not like they're losing money. Also, Mexico is a net importer of oil & petroleum products with the US, the US could hold them hostage for oil to some extent. Trump has already brought many thousands of auto manufacturing & other jobs back to the US anyway so trade in autos soon won't matter. Bottom line is that like it or not, the US is negotiating from a position of strength, and if they cut off Mexico entirely the effects won't be nearly as severe as you think.

[Flagg]

This plan is so stupid I wonder how the hell it ever got written down.

First, it is blatantly illegal unter NAFTA.

Second, the USA has tried in the past to engage in trade wars with various nations (most notably Europe). Not once did it work out well for them.

All this will do is impoverish US consumers.

Not to mention that I guarantee there is a 110% chance that there will be undocumented Mexican immigrants building the fucking thing.

I just wonder how long until the Trumpistas start publicly advocating shoot-on-sight of anyone climbing over the wall and then building a second wall with land mines between them. Because I can guaran-fucking-tee you that they want to. They probably already have blueprints.

[Khaat]

Trump plans on tearing up NAFTA anyway so the fact that it's currently illegal doesn't matter.

And there's no downside at all to abandoning that? No harm to US export markets? It has been pointed out before: other nations can tell the US to Go Suck It: they don't have to accept any deal they don't like. US Advantage: none. But peeing in the pool is fun!

Next, the US runs a ~$60 billion trade deficit with Mexico so if the trade shuts down entirely it's not like they're losing money.

Nice, vague "big picture" view, but not if it costs you your job. Funny thing about top-level executives: they don't actually know how the work gets done.

If the Wall costs twice that (by conservative estimates, before inevitable government contractor cost overruns)? And is no guarantee to halting "imported labor" anyway? That this trade deficit somehow won't impact US consumers negatively? Or that US exports somehow continue at the same rate (with someone else to make up for Mexico)? Stop a net "trade deficit", sure, but what's the actual cost to the US consumer/employee?

I used quotations around 'trade deficit' because this calculation does not take into effect knock-on costs (traditional blind-spot for business executives: if it isn't on their books when the net loss happens, it doesn't matter!): reduced exports means reduced production, means layoffs and/or reduced labor and/or wages, which means increased un-/under-employment, AND increased consumer costs on any imported goods - employee/consumers lose out while Regressive Taxes Grow (Yay Republicans!)

As resource-management game gurus (and any economist not severely biased) can tell you: "the slider bars are all interconnected. Except executive bonuses."

Also, Mexico is a net importer of oil & petroleum products with the US, the US could hold them hostage for oil to some extent.

...Or Mexico can get their oil somewhere else and Trump just gave the world oil suppliers a market bump at no benefit to the US. Suddenly that $60B trade deficit increases to ... how much (net) oil were we exporting to them? Who's getting all their oil money now? What US ports aren't moving oil for Mexico anymore? What US refineries aren't refining oil for Mexico? How many US jobs are lost?

Trump has already brought many thousands of auto manufacturing & other jobs back to the US anyway so trade in autos soon won't matter.

[citation needed]... Provided US workers want to be the only ones buying the cars (that cost more than they can afford, at busted-union reduced pay, and with no breaks, before being displaced by automation), as foreign retaliation tariffs will kill (or at least harm significantly) the US export market, driving down demand for but not costs on manufactured goods. The senior corporate officers won't be taking a personal loss when the "US First (and Only)" auto market tanks (again, just like last time). Yes, soon trade in autos won't matter, shortly after Trump demonstrates US workers don't matter.

Bottom line is that like it or not, the US is negotiating from a position of strength, and if they cut off Mexico entirely the effects won't be nearly as severe as you think.

If we were the only ones with toys in the sandbox, AND could take them all home whenever we wanted, AND everyone could only get them from us, that might be true. Since it isn't... well, duh.

The US? Now just another bloated, cranky, sex- and violence-obsessed posturing caricature, with a President to match.

[Simon_Jester]

This plan is so stupid I wonder how the hell it ever got written down.

First, it is blatantly illegal unter NAFTA.

Second, the USA has tried in the past to engage in trade wars with various nations (most notably Europe). Not once did it work out well for them.

All this will do is impoverish US consumers.

Trump's supporters live in an alternate reality. A lot believe he won the popular vote despite evidence to the contrary. They believe Trump would improve Obamacare even though they are fully unaware of any plan on how he is going to do that.

If a trade war started by Trump fucks them over they would convince themselves its not Trump's fault. Must be Mexico's fault instead.

Agreed.

As I said yesterday, from the point of view of everyone in the world with any sense, when it comes to US foreign and domestic policy, King Log has been replaced by King Stork. We may not have been pleased with King Log's actions (or lack thereof), but King Stork is so very much worse that it puts all our past complaints literally to shame by comparison.

[Sea Skimmer]

This plan is so stupid I wonder how the hell it ever got written down.

First, it is blatantly illegal unter NAFTA.

Which gives Trump a ready made excuse for not implementing it six months or a year from now, since he has no executive control over enough money to start building it without congress, and thus the chance of appearing to moderate to his supporters when whatever the shit compromise happens. The more insane an initial proposal he employs the better this goes, haven't you followed Putin enough to see how this works? It's not exactly a new tactic politically.

Trump's supporters live in an alternate reality. A lot believe he won the popular vote despite evidence to the contrary. They believe Trump would improve Obamacare even though they are fully unaware of any plan on how he is going to do that.

Would have helped had the Democrats bothered to say anything useful either. One of the few things they pushed, letting Medicare negotiate with drug companies again, was also an idea backed by Trump. Mainly because that part of Obamacare was abysmally stupids in the first place. The fact that it was in a purely democratic passed piece of legislature in the first place should tell you a lot about the wonders of the Democratic party in recent history, and why Sanders was suddenly so popular when people suddenly learned someone like him existed at all.

[Korto]

For a lovely irony, the "real winner" out of Trump's wall, if built, could be Mexico.
According to this article from the Guardian, the construction workers and materials for the wall are most likely to come from Mexico, due to them being the closest and cheapest.
While Trump is claiming $10 Billion for the wall, The Guardian is citing experts estimating the cost more at $31 Billion. Of course, those experts would be assuming the cheapest and closest supplier of labour and materials (Mexico). If Trump decides USA ALL THE WAY!!! then that's going up.
Ooops, it just went up.

Controlling 2.8m acres of a reservation, the Tohono O’odham Nation vowed to oppose construction on its land and called for a meeting with the president

Far as I see, they would have to be either Bought off, Built around, or Beaten in court. Any of which mean more expense.


I have to say this. Sorry, but I really have to.
You elected Bobo the Orange-Faced clown. You did it. You actually elected Bobo. Oh my God.
To steal a line from a story I wrote (originally from a Magic card)...

It's funny until someone loses an eye...and then, it's hilarious.

[Simon_Jester]

You are fully entitled to laugh at us. Literally the entire planet is entitled to laugh at America. Despite all sanity and most of the odds, Trumpolini managed to pull off a victory, in what will likely go down in history as America's most catastrophic own-goal.

Everyone is fully entitled to laugh at us, forever, because of this. If, in a thousand years, my ghost witnesses history students of the future are laughing at the US over what happens in the next four years...

I will be pained, but I will not have resentment. I have no right to resent it.

I ask not to be blamed, as I give Trumpolini no support. But I cannot ask not to be laughed at, nor will I.

[slumps]

[Flagg]

For a lovely irony, the "real winner" out of Trump's wall, if built, could be Mexico.
According to this article from the Guardian, the construction workers and materials for the wall are most likely to come from Mexico, due to them being the closest and cheapest.
While Trump is claiming $10 Billion for the wall, The Guardian is citing experts estimating the cost more at $31 Billion. Of course, those experts would be assuming the cheapest and closest supplier of labour and materials (Mexico). If Trump decides USA ALL THE WAY!!! then that's going up.
Ooops, it just went up.

Controlling 2.8m acres of a reservation, the Tohono O’odham Nation vowed to oppose construction on its land and called for a meeting with the president

Far as I see, they would have to be either Bought off, Built around, or Beaten in court. Any of which mean more expense.


I have to say this. Sorry, but I really have to.
You elected Bobo the Orange-Faced clown. You did it. You actually elected Bobo. Oh my God.
To steal a line from a story I wrote (originally from a Magic card)...

It's funny until someone loses an eye...and then, it's hilarious.

I already said it's obvious the damned thing will be built by undocumented Mexicans. It's the ultimate irony, but it's going to happen. Of course the obvious thing would be to have our Legions The Army Corps of Engineers do it. But I think they are permanently on guard in case Poseidon tries to invade New Orleans again.

And as much as I hate clowns, comparing them to President Pussygrabber is fightin' words and I shall defend their honor.

I demand satisfaction, sir.

Dawn. Flamethrowers at 5 paces!

[Dragon Angel]

Controlling 2.8m acres of a reservation, the Tohono O’odham Nation vowed to oppose construction on its land and called for a meeting with the president

Far as I see, they would have to be either Bought off, Built around, or Beaten in court. Any of which mean more expense.

Or simply just beaten. With dogs, sticks, rubber bullets, freezing water, and grenades. Look at Standing Rock.

This country respects Native American treaties like it does toilet paper and it will probably stay consistent here.

[Adam Reynolds]

As I said yesterday, from the point of view of everyone in the world with any sense, when it comes to US foreign and domestic policy, King Log has been replaced by King Stork. We may not have been pleased with King Log's actions (or lack thereof), but King Stork is so very much worse that it puts all our past complaints literally to shame by comparison.

That really is the best analogy I have heard for what is currently going on.

[Simon_Jester]

Yep.

It is my opinion that one of the many reasons for society having declined in some respects over the past several decades is growing ignorance of basic cultural staples and metaphors... like Aesop's fables. A lot of things are very neatly encapsulated by lessons like that.

"The thing that hath been, it is that which shall be; and that which is done is that which shall be done: and there is no new thing under the sun."

That particular bit of Ecclesiastes may be an exaggeration, but there's a certain validity to the sentiment expressed.

[K. A. Pital]

I like the fables. Some of Krylov's retellings and original plots in the Slavic tradition do remind me of something.

I really like "The Kitten and the Starling". At some point, the cat who is incited towards violence would devour the teacher.

Many Republicans have been preaching a type of "Conservative revolution"-like ideology, which is at the core a fertile soil for fascism:
http://en.wikipedia.org/wiki/Conservati ... y_movement

The story was complete when the product of these "intellectual findings" reacted in a familiar way towards the teacher:
http://en.wikipedia.org/wiki/Edgar_Julius_Jung

Indeed, the story of Republican support of Trump is not yet complete. I wonder what will happen to the dissenters - those who longed for someone like Trump, but are now terrified of him.