Trump's proposed Mexico tariffs could devastate Virginia

In a move that rattled lawmakers, economists, and immigration advocates, President Trump announced on Thursday a plan to impose 5% tariffs on Mexican imports, starting on June 10, as a form of punishment for Mexico’s failure to stop the flow of central American migrants from reaching the American border.

The White House said the tariff would jump by 5% increments each month until it reached 25% in October, unless Mexico takes action.

What would this mean for Virginia?

President Trump’s ongoing trade war could already cause “extremely significant damage” to Virginia, according to the U.S. Chamber of Commerce, and Trump’s proposed Mexico tariff would only exacerbate the issue.

While Trump says the tariffs are intended to punish Mexico, they could actually hurt American businesses and consumers the most. Since tariffs are paid by the companies that import products, American corporations would be on the hook for increased costs, and those costs might then be transferred to consumers, including those in Virginia.

In 2018, Virginia imported $1.4 billion worth of goods and services from Mexico, according to the U.S. Census Bureau. Should Trump’s tariffs go into effect and escalate past 5%, they could devastate Virginia companies that rely on those imports.

The tariffs could also jeopardize approval of the United States-Mexico-Canada Agreement (USMCA), Trump’s renegotiated NAFTA deal, which could pose even more severe consequences for the Commonwealth’s economy.

Virginia exported $4.3 billion worth of goods and services to Canada and Mexico in 2018. If the USMCA falls apart and the U.S., Mexico, and Canada impose tariffs on each other, the result could cause costs to soar for companies, and in turn, for consumers.

Implosion of a trade deal could also lead to the loss of thousands of jobs in Virginia. Since the original NAFTA was implemented in 1994, jobs in Virginia supported by international trade have increased by nearly 100% and nearly one-in-five jobs in the state are now linked to international trade.

It’s not just Virginia, either.

Nationwide consequences

Trump’s tariffs could wreak havoc all across the country, prompting backlash from Democrats and Republicans alike. Both of Iowa’s Republican senators, Chuck Grassley and Joni Ernst, spoke out against the tariffs and the impact they would have on everyday Iowans.

In a statement, Grassley said trade policy and border security are “separate issues,” and Trump’s action was a “misuse of presidential tariff authority and counter to congressional intent.”

The controversial decision is Trump’s latest attempt to prevent migrants from reaching the country’s southern border and highlight an increasingly desperate approach to immigration.

The business community also expressed its displeasure and is even considering taking legal action against the White House over the proposed tariff, according to CNBC.

Despite this backlash, Trump has shown no signs of backing down.

If he goes through with his threat to levy the tariffs, it’s unlikely that it will solve the migrant crisis, an issue that has persisted for years. What it will almost definitely do, however, is damage the economy of the Commonwealth.