Column: Trump’s border tax is not the right fix for U.S.-Mexico trade | PBS NewsHour

There is little to gain and much to lose by using a border tax adjustment as either a punitive import tariff or a policy designed to finance a border wall.

BY CHAD BOWN  January 30, 2017 at 3:57 PM EST
Less than one week into office, President Donald J. Trump issued an executive order indicating U.S. intent to build a wall on the border with Mexico. The next day, White House Press Secretary Sean Spicer stated the administration might pay for the wall by levying a new, 20 percent border tax on U.S. imports from Mexico.

A significant diplomatic fallout erupted. New confusion also suddenly arose due to the apparent shift in Trump’s policy priorities.

Further U.S. rhetoric and escalation could even force trading partners to seek vigilante justice … This would result in considerable economic pain to U.S. companies and U.S. jobs.

The Trump administration needs to tell the truth about this 20 percent border tax adjustment. Further obfuscation elevates the risk that any U.S.-imposed border tax adjustment would lead to an immediate trade dispute, that the United States would lose that dispute and that the U.S. would face internationally sanctioned retaliation.

Worse, further U.S. rhetoric and escalation could even force trading partners to seek vigilante justice. They could address their own trade problems in ways that lead everyone into an inadvertent trade war. This would result in considerable economic pain to U.S. companies and U.S. jobs.

Read the full essay here: Column: Trump’s border tax is not the right fix for U.S.-Mexico trade | PBS NewsHour

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