Quote:I don't mind cutting unnecessary items from the federal budget. 

 

What I do mind is starting a trade war with Mexico, which would damage our economy and raise prices for American consumers. 

I don't think so. Mexico has basically no impact on our exports as they don't buy many (think weapons/advanced medical equipment) basically only things that we are best in the world at and they couldn't get anywhere else (and are also already expensive). So them tariffing us won't have a major impact because they already only buy what they HAVE to buy from us (i.e. what we have expertise in that they simply cannot match). Whereas we buy many things (cars will be my primary example, but also air conditioners etc) that we also make here.

 

As far as us tariffing them, its a different story. They don't make anything that we cannot. Therefore their prices can only go as high as US competition will allow. Raising prices on some vehicles manufactured there would happen somewhat, but really it would just cut margins (a truck isn't more valuable, even if FCA had to pay a import fee). Perhaps this margin cut would be enough to stimulate companies to come back. FCA would be an example of someone who would get hurt. Ford and GM? Not as much. They make more of their trucks here.

 

The South will disproportionately be advantaged due to lower wages and more business friendly laws. Next would be the rust belt. This would be an undoubted net benefit. Once again, tariffs on Mexico do not affect consumer cost if there are businesses here that do the same thing. Companies that import from Mexico cannot charge a premium for Mexican products (LOL, why pay more for a worse product?), so their price cannot go up if someone else makes it. This is a unilateral WIN for the US.

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