Trump threatens tariffs on Mexico over immigration

By Meg Wagner and Brian Ries, CNN

Updated 6:25 p.m. ET, May 31, 2019
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12:41 p.m. ET, May 31, 2019

Meanwhile, China's retaliatory tariffs on US exports take effect

From CNN’s Matt Rivers, Steven Jiang and Julia Horowitz

China's retaliatory tariffs on some $60 billion worth of US exports has just officially gone into effect as of 12 p.m. ET.

Beijing said earlier this month that it would increase tariffs on roughly $60 billion worth of US goods on June 1, including American cotton, machinery, grains and aircraft parts.

More than 4,000 items are affected, most of which will carry tariffs of 25% — up from 10% when they were first levied last September. 

Some background: The move follows increase in US tariffs on $200 billion worth of Chinese exports from 10% to 25%, which went into effect May 10. The Trump administration, which has accused China of backtracking on previous trade commitments, sought to turn up the pressure on Beijing after months of talks failed to produce a breakthrough. But so far, the tit-for-tat penalties have not pushed Beijing toward a deal. 

12:12 p.m. ET, May 31, 2019

How the Mexico tariffs could affect avocados and tomatoes

From CNN's Zachary B. Wolf

A farmer works at an avocado plantation in El Carmen ranch in the community of Tochimilco, Puebla State, Mexico, on April 5
A farmer works at an avocado plantation in El Carmen ranch in the community of Tochimilco, Puebla State, Mexico, on April 5 JOSE CASTANARES/AFP/Getty Images

The costs of any tariff imposed on Mexico will ultimately be passed along to American consumers. (Remember: Tariffs are paid by importers, not by exporting countries.)

So what does that mean? Tariffs will affect the supply chain for ...

  • The US auto industry
  • Machinery
  • Medical instruments
  • Avocados and tomatoes (and plenty of other fruit and vegetables.)

And it's a two-way street. Americans sold just shy of $300 billion in goods to Mexico in 2018 — cars, machinery, pork and beef. Billions and billions dollars worth of many different type of goods that might be subject to retaliatory tariffs from Mexico.

12:12 p.m. ET, May 31, 2019

Mexico's president to Trump: "The Statue of Liberty is not an empty symbol"

From CNN's Natalie Gallón

Mexico's President Andrés Manuel López Obrador, in response to President Trump's threat to impose tariffs on Mexico, said social problems cannot be resolved with "coercive measures."

He added that the "Statue of Liberty is not an empty symbol," in an open letter to President Trump. 

Trump has threatened to impose tariffs on Mexico unless it steps up its immigration enforcement actions.

President López Obrador (also known by his initials AMLO) asked how the United States could "overnight" transform from a country signifying hope for migrants to a "ghetto" where they are "stripped of their rights."

Here's his letter: 

"President Trump: social problems are not resolved with tariffs or coercive measures. How do we, overnight, transform a country with brotherly sentiments towards migrants of the world to a ghetto; to a closed space, where we stigmatize, mistreat, persecute, expel, and strip the rights of those who with effort and work, look to live free of misery? The Statue of Liberty is not an empty symbol. With all due respect, and while you have the sovereign right to express it, your slogan “America First” is a fallacy, because until the end of time, beyond national borders, justice and universal brotherhood will prevail."

11:41 a.m. ET, May 31, 2019

White House moved quickly on the tariff announcement because they didn't want it to leak

From CNN's Kaitlan Collins 

YURI GRIPAS/AFP/Getty Images
YURI GRIPAS/AFP/Getty Images

White House officials held a call yesterday morning to discuss President Trump’s decision to move forward with his threat of tariffs on all imported goods from Mexico if the country doesn’t stop the flow of migrants across the southern border. 

Trump had been privately advised against the idea from more cautious members of his team, including Treasury Secretary Mnuchin, while others, like Peter Navarro, told him the dramatic move would get Mexico’s attention. It’s clear who Trump sided with. 

About the timing: During the call, officials decided to announce the move Thursday night — instead of preparing a smoother, more calculated rollout — because they didn’t want any more details to leak to reporters.

That rollout hasn’t gone as smoothly as officials had hoped. They have gotten an earful from Republican lawmakers who have expressed alarm at the decision, with some urging the President to reconsider. Sen. Chuck Grassley’s statement criticizing the decision has been widely discussed inside the West Wing this morning, but Trump has shown no sign of backing off his threat.

11:24 a.m. ET, May 31, 2019

Mitch McConnell: The US-Mexico relationship is vital, and any plan that impacts it "deserves serious examination"

Alex Wong/Getty Images
Alex Wong/Getty Images

Senate majority leader Mitch McConnell is walking a tightrope when it comes to Trump's tariff threat.

He is pointing the finger at Democrats for the "crisis at our southern border" — but also not taking a strong position on the tariff plan.

Here's the Republican leader's statement:

"There is a serious humanitarian crisis at our southern border, and it is past time for my Democratic colleagues to finally get serious about meaningful action. As our third biggest trading partner, a healthy and vibrant economic relationship with Mexico is a vital source of our joint prosperity. Any proposal that impacts this relationship deserves serious examination and I look forward to discussing this plan in greater detail with my colleagues and the administration."
11:14 a.m. ET, May 31, 2019

How Trump's Mexico tariffs would work, according to the White House

From CNN's Abby Phillip, Kevin Liptak, Caroline Kelly and Kaitlan Collins

Chip Somodevilla/Getty Images
Chip Somodevilla/Getty Images

President Trump threatened on Thursday to impose new tariffs on Mexico if the country does not step up its immigration enforcement actions, combining his boiling border-related frustrations with his preferred method of punishing foreign countries.

Here's how it would work, according to a White House statement:

  • The first round of tariffs would begin on June 10 at 5% "on all goods imported from Mexico."
  • If Mexico does not act as Trump demands, tariffs would go up to 10% by July and 15% by August.
  • The tariffs would hit 20% by September and reach a permanent level of 25% by October.

The statement said Trump would carry out his threat under authority from the International Emergency Economic Powers Act and that he would lift tariffs only "if the illegal migration crisis is alleviated through effective actions taken by Mexico."

10:58 a.m. ET, May 31, 2019

Trump's been tweeting about the tariffs a lot this morning

President Trump has repeatedly tweeted about his threats to implement new tariffs on Mexico over immigrations.

His most recent tweet he predicted that companies will leave Mexico because of the tariffs. He also claimed they'll stop drugs:

Earlier today, he demanded that Mexico "finally do what must be done" on immigration:

But he blamed Democrats before that. Earlier this morning, Trump tweeted that Democrats could “solve the problem” at the border with a “quick and easy fix."

10:51 a.m. ET, May 31, 2019

White House: "The President has the legal authority to do this"

From CNN's Joe Johns and Betsy Klein

White House press secretary Sarah Sanders dismissed any legal concerns with the President’s tariffs announcement.

Asked if there are concerns the action will get tied up in court, Sanders said:

“Not at all. The President has the legal authority to do this through IEEPA. In fact, that give him much broader authority than he’s taken on this front.”

For context: IEEPA is the International Emergency Economic Powers Act, which authorizes the President to regulate commerce after declaring a national emergency.

She continued, “This is a measured response to the authority that he has, there’s case law that supports it from precedent where this has been done in the past. And again, the President’s going to fulfill his duty, it would be nice if Congress would fulfill theirs.”

However: As CNN reported yesterday, privately, officials have conceded it’s not clear the White House has the legal authority to impose tariffs on this scale. They are concerned that, because of the scope, the mandate will potentially face legal challenges that could leave it tied up in the courts before June 10 even gets here. 

10:44 a.m. ET, May 31, 2019

Volkswagen says tariffs could hurt US consumers and threaten job growth

From CNN’s Brittany Gibson

VLADIMIR SIMICEK/AFP/Getty Images
VLADIMIR SIMICEK/AFP/Getty Images

Volkswagen, the world’s largest carmaker, warned on Friday that tariffs imposed on Mexico could hurt U.S. consumers and threaten jobs growth.

“We believe that tariffs of this kind are a tax on the U.S. consumer and will result in higher prices and also threaten job growth." the automaker said in a statement.

Volkswagen said it has made significant long-term investments in the United States "that would be impaired by restrictive changes to trade." 

The company said it remains hopeful that the issue will be resolved "through constructive negotiations without the imposition of tariffs."

Remember: Mexico is a regional manufacturing hub for global automakers that assemble cars in Mexico and ship many of them to the United States.

Volkswagen shares are down almost 3% in Europe. Among the biggest fallers are Mazda and Nissan in Japan which plunged 7% and 5% respectively. In the US, Ford shares are down 3% and GM dropping more than 4%.