US President Donald Trump plans to impose tariffs on Canada and Mexico starting Tuesday, in addition to doubling the 10% universal tariff charged on imports from China.
In a Truth Social post on Thursday, Feb. 27th, Trump said illicit drugs such as fentanyl are being smuggled into the United States at “unacceptable levels” and that import taxes would force other countries to crack down on the trafficking.
“We cannot allow this scourge to continue to harm the USA, and therefore, until it stops, or is seriously limited, the proposed TARIFFS scheduled to go into effect on MARCH FOURTH will, indeed, go into effect, as scheduled,” the Republican president wrote. “China will likewise be charged an additional 10% Tariff on that date.”
The prospect of escalating tariffs has already thrown the global economy into turmoil, with consumers expressing fears about inflation worsening and the auto sector and other domestic manufacturers suffering if Trump raises import taxes. But Trump has also at times engaged in aggressive posturing only to give last-minute reprieves, previously agreeing to a 30-day suspension of the Canada and Mexico tariffs that were initially supposed to start in February.
The threat of tariffs frightened the stock market, with the S&P 500 index falling 1.6% on Thursday. The S&P 500 is now just 1.4% higher than it was after Trump won the election in November, giving up almost all of the gains that the president once cited as evidence of an economic revival.
Asked Thursday about the fact that tariffs are largely paid for by consumers and importing companies, Trump dismissed any concerns by saying: “It’s a myth.” A stronger U.S. dollar can offset some of the costs of tariffs, but Trump’s statement goes against most economic modeling given the breadth of his planned taxes.
Trump intends to impose 25% tariffs on imports from Mexico and Canada, with a lower 10% tax on Canadian energy products such as oil and electricity. The move, ostensibly about drug trafficking and immigration, led Mexico and Canada to respond by emphasizing their existing efforts to address these issues. Canada created a fentanyl czar, and Mexico sent 10,000 members of its National Guard to its border with the United States.
Mexican President Claudia Sheinbaum said Thursday that she hoped to speak with Trump after the Cabinet-level meetings occurring in Washington this week. Mexico’s Foreign Affairs Secretary, Juan Ramón de la Fuente, was scheduled to meet with Secretary of State Marco Rubio on Thursday afternoon.
Trump, “as you know, has his way of communicating,” Sheinbaum said. But she said that her government would stay “cool-headed” and optimistic about an agreement coming together to avoid the tariffs.
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