Trump Gets Mexico Deal — and Once Again Backs Away From Tariffs
Trump also added another chapter in his now-familiar pattern on tariffs: threaten to go big, pull back at the last minute.
(Bloomberg) -- President Donald Trump pushed Mexico -- and his own party -- to the brink when he threatened massive new tariffs over illegal immigration. And he now has a cross-border deal to show for it.
He also added another chapter in his now-familiar pattern on tariffs: threaten to go big, pull back at the last minute.
The move comes as Trump prepares for a potential high-stakes meeting with his Chinese counterpart Xi Jinping on the sidelines of the Group of 20 meeting in Osaka, Japan, at the end of this month. The abrupt U-turn on Mexico by Trump within a week, in return for what appear to be meaningful yet still relatively modest concessions, is likely to add to confusion in Beijing about Trump’s negotiating goals.
Trump announced late Friday that he wouldn’t impose a sliding scale of tariffs on goods from Mexico -- from 5% to 25% over time -- after that nation agreed to take a tougher stance on immigration, which was his goal all along. Trump on Saturday tweeted that Mexico also will buy “large quantities” of agricultural products, a stipulation that wasn’t included in a joint statement.
Mexico did commit to doing more -- deploy National Guard troops to help curb illegal migration and agree to care for Central Americans seeking asylum in the U.S. indefinitely as their cases wind through the system.
Read the joint statement of the U.S. and Mexico
American negotiators had been asking Mexico since the election of Andres Manuel Lopez Obrador in July 2018 to do more to stop the flow of migrants. But it was only in the past week, under the threat of tariffs, that they felt Mexico had begun negotiating seriously, according to a U.S. official.
“Mexico successfully avoided the catastrophe of tariffs but will pay a heavy price,” said Duncan Wood, director of the Mexico Institute at the Woodrow Wilson International Center for Scholars in Washington. “Potentially tens of thousands of refugee claimants will have to wait in Mexico while their claims are processed. Mexico will have to house, employ, educate and provide health care for them. This is a huge commitment” for the government.
Mexico has been gearing up to address the surge of migrants, with Mexico’s foreign minister, Marcelo Ebrard, saying Thursday the country was prepared to deploy about 6,000 guard troops. And the country already has been hosting asylum seekers while their cases were being processed.
The U.S. originally demanded that Central American migrants apply for asylum in Mexico instead of the U.S. But Mexico beat back that demand. Also, there was no formal language related to increased purchases of U.S. agricultural products, as Trump promised on Twitter, but on Saturday he used Twitter to announce, in call capital letters, Mexico’s buying plans without providing details.
All of this could leave some of those most upset over Trump’s approach, including some Republicans, questioning whether the turmoil of the last week was really worth it.
The whole episode also had a familiar feel: Trump has repeatedly threatened Mexico over immigration only to back off. First, he said he’d immediately close the southern border over migration. Then he abruptly pivoted in April to a new demand: that the Mexican government stop the flow of illegal drugs into the U.S. within a year or face tariffs on automobiles.
Auto Tariff Threat
Separately, Trump has threatened European and Japanese carmakers with tariffs in the name of national security but then said he’d delay any action by 180 days.
This is far from the first time the president has faced criticism over his stance on tariffs. What made this time different was just how alone Trump was in his position. The list of opponents to the idea was long: the U.S. Chamber of Commerce, farm groups, automakers and Senate Majority Leader Mitch McConnell, who took the rare step of saying publicly he disagreed with the president.
Even elsewhere in the Trump administration there was little vocal support for Trump’s Mexico tariffs. Treasury Secretary Steven Mnuchin opposed them, a person familiar with the matter said. So did Trump’s senior adviser and son-in-law, Jared Kushner, the New York Times reported.
Republicans, who have grown adept at talking about areas of disagreement with Trump without sounding like they disagree, didn’t hold back.
“I don’t even want to think about it,” Senator John Cornyn, a Texas Republican, said last week after he was asked about the potential economic harm to his home state.
“I know he’s sometimes, in his frustration, expressed his intention to do certain things, but after calm reflection and consultation with the members of the Congress has decided maybe to pursue a different course,” Cornyn said then. “So that’s what I hope will happen here.”
The wishes of Cornyn -- and many others -- were granted.
Republicans quickly rallied around the president for securing the deal and suggested this could clear the way for Congress to approve the new trade deal between the U.S., Canada and Mexico, known as the USMCA.
“Trump has proven those who doubted him wrong by getting Mexico to step up their efforts to help us secure our southern border,” the No. 2 House Republican, Steve Scalise of Louisiana, said in a statement. “Tonight’s deal made by President Trump also puts us in a better position to make USMCA a reality.”
Yet other Republicans were more nuanced in their reaction. Senator Joni Ernst, an Iowa Republican, said her constituents were “breathing a sigh of relief” and that Mexico “stepped up to help” address the humanitarian crisis. But her statement Friday night didn’t mention Trump.
The deal does alleviate a political challenge for McConnell, given that the 2020 electoral map is far less friendly for the GOP than for Democrats.
Trump’s approval ratings are underwater in a handful of states where Senate Republicans are running for re-election, including Ernst, Cory Gardner in Colorado, Susan Collins in Maine and Thom Tillis in North Carolina.
While Tillis, who faces a primary challenge, was an early backer of Trump’s tariff strategy despite previously calling himself a free trader, others including Cornyn, Ernst and Gardner have been outspoken critics of the president’s trade policy.
Trump had announced the tariff threat in response to a surge in illegal migration to the U.S. through Mexico this year. More than 144,000 people were apprehended after illegally crossing the southern border in May or were refused entry to the U.S. That’s the most in a single month in at least five years; the number has grown every month since January.
Ebrard, said the resolution was fair. “We reached some middle point,” he said.
He added that the two countries will continue discussion for other possible steps in 90 days if needed, an implicit reminder that tensions could flare again if the migrant crisis continues to worsen.
--With assistance from Shannon Pettypiece, Ben Bain and Josh Wingrove.
To contact the reporters on this story: Steven T. Dennis in Washington at sdennis17@bloomberg.net;Eric Martin in Mexico City at emartin21@bloomberg.net;Nick Wadhams in Washington at nwadhams@bloomberg.net
To contact the editors responsible for this story: Kevin Whitelaw at kwhitelaw@bloomberg.net, ;Alex Wayne at awayne3@bloomberg.net, Ros Krasny
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