The only point I could see people bring up is the fact that the people who pay tariffs are citizens of the US and firms in the US who are consuming the products that are imported. It's not like this tax is being levied against the Mexican government for each product that is shipped into the US. All this does is make Mexican products more expensive, and make American (or other countries products) seem cheaper.
I'm not saying by this rationale that this is a good/bad decision. I do think that this is going to help force the Mexican government into working towards a solution though. Just wanted to show who pays for this.
I'm not saying by this rationale that this is a good/bad decision. I do think that this is going to help force the Mexican government into working towards a solution though. Just wanted to show who pays for this.
That's not so. Consumers in the USA will not "pay for more expensive Mexican goods that include the US Tariff."
They will see the Mexican goods as one option in a competitive market, and likely pick some other, equally good product, which does not include a tariff. The net effect of this is Mexico losing substantial income and trade, the US getting minimal tariff income, and US consumers paying minimal amounts of tariffs.
But you have to understand that the only reason that other goods are going to be bought by Americans due to the fact that Mexican goods are going to be more expensive due to the tarrifs. That's the only reason that the other goods now have to compete with other, more expensive goods.
They may still pay for Mexican products if they are still cheaper than other, comparable products, even with the tariff.
Additional empirical evidence that tariffs hurt the country they are levied against is that the various countries Trump has levied tariffs against have issued retaliatory tariffs, and have tried to negotiate with the US to get the tariffs removed.
