Donald Trump to Mexico: Stop Migration or Face Five Percent Tariffs in June

FIve things to know about migrant caravans crossing Mexico
© AFP/File ORLANDO SIERRA

Mexico’s vital trade with the United States will be taxed until the country’s government blocks the mass migration of Central Americans into the United States, President Donald Trump announced via tweet late Thursday.

“On June 10th, the United States will impose a 5% Tariff on all goods coming into our Country from Mexico, until such time as illegal migrants coming through Mexico, and into our Country, STOP.,” Trump tweeted around 8.00 p.m.

“The Tariff will gradually increase until the Illegal Immigration problem is remedied,.. ….at which time the Tariffs will be removed. Details from the White House to follow,” he said in the pair of tweets.

The two tweets were launched two hours after Trump spotlighted the huge migration from Mexico into the United States:

Business groups will strongly oppose border taxes because they raise the cost of using cheap labor in Mexico. In March and April, business pressure forced Trump to drop his threats to close border roads until Mexico shut down the migration.

Todd Schulte, the director of a D.C. advocacy group for cheap-labor migration, said in a tweet that Trump is using the tariffs to pressure Mexico to sign an agreement which would allow the U.S. government to reject migrants who pass through Mexico. 

Schulte’s FWD.us group was founded by a network of West Coast investors, including Facebook’s Mark Zuckerberg.

Pro-migration groups, including the ACLU, will sue to block the presidential authority to impose tariffs.

Mexico’s governments zig-zag between public cooperation and quiet passivity while participating in various border-security meetings, amid deep public sympathy for the Central American migrants. The nation’s security agencies conduct periodic crackdowns on the huge migrant flow from Guatemala, Honduras. and El Salvador, even as the armed cartels quietly run transport networks — including a bus service — that openly traffic laborers and migrants into the United States.

The cartels’ labor trafficking is hugely profitable and generated up to $2.3 billion in 2017 revenues, according to a study by the Rand Corporation. The revenue ensures the cartels can bribe and threaten many people in Mexico’s federal and state agencies.

Trump’s declaration comes after Congress similarly zig-zagged between different crises — including caravans, dead children, funding fights, the border wall — as it steadily refuses to fix the catch-and-release loopholes at the border.

Those catch-and-release loopholes allowed 100,000 migrants through in April and May and allowed the annual inflow of nearly 800,000. Millions of additional migrants tell pollsters they wish to migrate into the United States.

The rush of migrants into U.S. workplaces and schools has spiked in 2019 because the cartels, the migrants, the border agencies, and the voters know that Congress is refusing to block the catch-and-release loopholes which are delivering hundreds of thousands of cheap workers to their political allies and their donors.

The migration means that employers quickly get an extra supply of tough, compliant, low-wage workers just as labor shortages are forcing companies to boost pay for Americans. The extra labor supply also reduces employers’ incentive to hire from the population of 12 million unemployed or underemployed Americans, some of whom are sidelined by disability, underinvestment in rural areas, or drugs.

Trump’s deputies are trying many options to stop the inflow, which is backed by Democrats and many GOP legislators. For example, officials are blocking some migrants from jobs to repay their smuggling costs by requiring them to wait in Mexico while their asylum appeals are processed. Officials are also trying to write a regulation to replace the 2015 Flores decision by a judge which bars the detention of migrant adults for more than 20 days if they bring a child across the border.

Immigration Numbers

Each year, roughly four million young Americans join the workforce after graduating from high school or university.

But the federal government then imports about 1.1 million legal immigrants and refreshes a resident population of roughly 1.5 million white-collar visa workers — including roughly one million H-1B workers — and approximately 500,000 blue-collar visa workers.

The government also prints out more than one million work permits for foreigners, tolerates about eight million illegal workers, and does not punish companies for employing the hundreds of thousands of illegal migrants who sneak across the border or overstay their legal visas each year.

This policy of inflating the labor supply boosts economic growth for investors because it ensures that employers do not have to compete for American workers by offering higher wages and better working conditions.

This policy of flooding the market with cheap, foreign, white-collar graduates and blue-collar labor also shifts enormous wealth from young employees towards older investors, even as it also widens wealth gaps, reduces high-tech investment, increases state and local tax burdens, and hurts children’s schools and college educations. It also pushes Americans away from high-tech careers and sidelines millions of marginalized Americans, including many who are now struggling with fentanyl addictions. The labor policy also moves business investment and wealth from the heartland to the coastal citiesexplodes rents and housing costsshrivels real estate values in the Midwest, and rewards investors for creating low-tech, labor-intensive workplaces.

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