Republican lawmakers are praising President-elect Donald Trump’s threat to punish Canada, China and Mexico with broad-based tariffs as a shrewd “negotiation strategy” to help curb the fentanyl and border crises — despite economists fearing they could tank the economy.
Rep. Dan Crenshaw said Trump has a proven track record that his threats work — pointing to the “Remain in Mexico” policy, which required asylum-seekers trying to cross the southern border to wait in Mexico until their cases were heard.
“This is how Trump got the ‘Remain in Mexico’ policy done in the first place,” Crenshaw (R-Texas) said on Fox News Tuesday. “He threatened a tariff, the tariff never came to be.
He added, “I don’t need to teach anyone Economics 101. Tariffs will hurt the American consumer, that’s true, but they also make for good negotiation tools. Especially when those tariffs will hurt Mexico a lot worse than it’ll hurt us.”
On Monday, Trump vowed to impose a 25% blanket tax on all goods coming in from Canada and Mexico if they fail to curtail the border and fentanyl crises.
The soon-to-be 47th president also threatened to slap a 10% across-the-board duty on China — in addition to current tariffs on products from Beijing — unless it reins in drug flow from its markets into the US. Beijing does face existing tariffs from the US.
Before Trump’s announcement, Treasury Secretary designee Scott Bessent suggested that tariffs could be used as a “maximalist negotiating position.” Other allies of the president-elect such as Commerce Secretary-designate Howard Lutnick have similarly suggested that it would be a bargaining chip.
“You’ve got to negotiate and that’s what Trump gets. That’s what people don’t understand. That’s what those clowns in Washington don’t get,” Rep. Tim Burchett (R-Tenn.) bragged about the economic prospects to Real America’s Voice.
Other GOP skeptics of tariffs largely appear to be keeping their powder dry on Trump’s tax on imports.
“I’m concerned about the potential of it,” Sen. Chuck Grassley (R-Iowa) told reporters Tuesday. “Right now, I see everything that Trump’s doing on tariffs as a negotiating tool.”
“And we’ll have to wait and see how successful he is about that.”
Other Republicans voiced their full support.
Rep. Glenn Grothman (R-Wis.) similarly backed Trump, saying “I fully support President-Elect Trump’s proposed aggressive economic measures against Mexico, Canada, and China, driven by serious concerns over our border security and the rampant drug trafficking that has plagued our nation.”
“Under the Biden-Harris Administration, other countries have exploited our open borders, flooding the United States with drugs, criminals, and unsafe practices. These reckless policies have led to countless deaths, including the tragic loss of American lives due to fentanyl and other drug overdoses.”
Last year, there were roughly 107,543 drug overdose deaths in the US, including 74,702 from fentanyl specifically, according to data from the US Centers for Disease Control and Prevention.
Rep. Carlos Gimenez (R-Fla.) also heaped praise on Trump’s move, focusing on how he wants Mexico to change its behavior.
“Mexico has been aiding the drug cartels and helping our enemies. They must pay the price,” Gimenez contended. “Mexico’s socialist President, Claudia Sheinbaum, is sending 400,000 barrels of oil to the murderous Communist Castro regime in Cuba.”
How it would work
Under the United States-Mexico-Canada Agreement, which Trump’s first administration helped negotiate, none of the US neighbors will have to pay tariffs if they comply with domestic content requirements, according to Alex Durante, an economist at the Tax Foundation.
Estimates vary about how much revenue the tariffs would generate. The Committee for a Responsible Federal Budget projects the tariffs on the three largest US trading partners will garner as much as $1.8 trillion over a decade.
Meanwhile, the Tax Foundation predicts it would generate as much as $1.2 trillion over the next 10 years after accounting for factors such as price elasticity as well as a potential decline in purchases of imports.
It also estimates that those tariffs would hamper gross domestic product by 0.4 percentage points and kill at least 344,900 jobs.
Combined, Canada, China and Mexico bought over $1 trillion in American exports during 2023 and sent almost $1.5 trillion worth of imports into the US, according to data from the US Census Bureau. For context, the total US GDP was $27.36 trillion in 2023.
By issuing the threat some 56 days before he gets sworn into office, Trump gave time to negotiate with China, Canada and Mexico over the tariffs.
Canadian Prime Minister Justin Trudeau spoke with Trump shortly after the threat in what he described as a “good call,” while Mexican President Claudia Sheinbaum penned a letter to Trump outlining the steps taken to address those issues already and vowed retaliation if he follows through.
Trump has long exhibited a fondness for tariffs, which he’s dubbed “the most beautiful word in the dictionary,” despite his protectionist proclivities deviating from recent GOP orthodoxy on free trade over the past several decades.
Republicans have splintered over tariffs in the past during the Trump era, with traditionalist free traders contending that they will hurt US competitiveness over the long term and populist protectionists wanting them to safeguard industry.
“I don’t like tariffs,” Sen. Rand Paul (R-Ky.) told CBS News’ “Face the Nation” Sunday. “I don’t like the president promoting tariffs. I think tariffs are a tax on the consumer … you can protect certain industries, but it’s at the expense of other people.”
But economists say it’s like ‘negotiating with terrorists’
Most economists seem to think that broad-based tariffs in the mold of what Trump has proposed could have deleterious ripple effects on the economy.
“It’s a bad negotiating position, like holding a gun to your own head and trying to negotiate with terrorists,” Scott Lincicome, vice president of general economics at the libertarian Cato Institute told The Post.
“It’s the old ‘Blazing Saddles’ routine where he holds a gun to his head and negotiates,” he added. “Tariffs don’t have a great track record of achieving US objectives and have only been successful half the time.”
Lincicome warned that the measure could “decrease investment in the US by as much as $30 to $40 billion” and noted that because “Congress has delegated a lot of its tariff powers to the president over the years,” Trump may be able to follow through on that threat.
Durante said to “expect some kind of hit to GDP, and definitely some slow down in growth from further tariff escalation.”
Brian Riedl, senior fellow at the Manhattan Institute, contended that Trump’s tariff threat “will spark a trade war and cost jobs.”
“America relies on Mexico for fruits, vegetables, and a lot of manufacturers’ inputs, and relies on Canada for a lot of crude oil. Those prices will rise dramatically, and the promised retaliations will kill jobs and hurt the economy,” Riedl argued.
“These tariffs could raise $200 billion annually, but much of that revenue will be lost to reduced import demand, lower real wages, and bailouts of affected industries.”
Historically, trade wars have been devastating. During the Great Depression, President Herbert Hoover signed the Smoot-Hawley Tariff Act ramping up tariffs by as much as 20% and higher on as many as 20,000 imported goods.
That protectionist policy, which triggered retaliatory measures from other nations, was seen by many economists as exacerbating the Great Depression.
Duncan Braid, the coalition director of American Compass, a populist conservative group, defended Trump’s tariff threat, stressing that something needs to be done about the border and fentanyl crises.
“Instead of defaulting to the status quo that prizes free trade above all else, President Trump is going to put ordinary Americans first. The smuggling of fentanyl across our borders is completely unacceptable and has resulted in hundreds of thousands of deaths,” Braid told The Post.
“It is a breath of fresh air to have a president willing to use trade policy to advance the national interest, and Congress should back him by imposing a 10% general tariff and rescinding PNTR from China.”
