(11-12-2024, 11:46 AM)The Real Marty Wrote:

(11-12-2024, 09:25 AM)homebiscuit Wrote: It’s a leverage tool. The U.S. can absorb increased costs associated with tariffs more than Mexico. However, if Mexico chooses to squelch the migrants hiking across their country towards the U.S. border and cracks down on fentanyl production using Chinese precursors, the tariffs don’t have to happen.

There is a risk, though.  If we don't get the desired response, all we have done is start a trade war, stoke inflation, and put a lot of people out of jobs who work for exporters on both sides of the border.  I doubt other countries will just raise their hands and surrender.  Most of our trading partners are democracies, subject to politics.  

And again, when you say, "the US can absorb increased costs..." it's the US CONSUMER who absorbs the increased cost, and the US EXPORTER who suffers from the retaliatory tariffs.  The US exported $323 billion worth of stuff to Mexico in 2023.