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Journalism of Courage
OVER THE last several days, US President Donald Trump has threatened to close the Mexico border as a measure to check illegal immigration. Last week, he tweeted: “… If for any reason Mexico stops apprehending and bringing the illegals back to where they came from, the U.S. will be forced to Tariff at 25% all cars made in Mexico and shipped over the Border to us. If that doesn’t work, which it will, I will close the Border.”
“… What Trump is talking about now, shutting the southern border, would be catastrophic. It’s just absurd,” The New York Times quoted Gary Hufbauer of the Peterson Institute for International Economics as saying.
Some of the likely impacts if the border were indeed to close:
Cars, TVs & hardware
The NYT report listed US manufacture as among the biggest victims of a border shutdown. US industries rely on Mexico, either by selling goods and services into Mexico or by using Mexican materials in their products. Mexico is the United States’ third largest trading partner, with the latter importing $349.6 billion from Mexico in 2018, and exporting $265 billion, The NYT said citing statistics from the Union Nations’ International Trade Center.
Among those affected would be automobile makers, with supply chains disrupted, as would those manufacturers of flat-screen TVs, computer hardware and medical devices, besides the apparel industry that sources raw materials from the US and makes finished products in Mexico. Mexico also depends on the US for natural gas through cross-border pipelines, while hundreds of thousands of US jobs are tied to transportation to and from Mexico.
Overall, The NYT said, top multinational companies would be affected — including Ford, Toyota, Boeing— and so would countless small- and medium-size businesses.
Avocados & other food
The US depends on Mexico for fresh fruit and vegetables like avocados — Mexico supplies 80% of the avocados eaten in the US — as well as tomatoes, strawberries, grapes and mangoes, while Mexico relies on US soybeans, corn, dairy products, The NYT said. Shutting the border would most likely lead to dwindling of supplies, a spike in prices of food items imported from Mexico, and a drop in prices of US crops besides a loss of market.
Lance Jungmeyer, president of the Fresh Produce Association of the Americas, told The NYT that Mexico supplies more than 60% of all US produce in the winter and early spring, and that a shutdown could result in immediate and uncontrollable spikes in prices for items like squash, tomatoes, cucumbers, melons — and the beloved avocado.
Business at home & away
The US Chamber of Commerce said in a statement: “Closing the US-Mexico border would inflict severe economic harm on American families, workers, farmers and manufacturers across the United States.” The NYT said this would likely prompt a drop in the stock market, denting the retirement savings of many Americans, as well as affect the ability of companies to raise money in the capital markets. It added that if business relations with Mexico are strained, border communities in the US would most likely suffer, from decreased economic activity as well as potentially higher costs from crime and migration.
More migration?
While Trump’s threat to close the border is meant to be a measure to contain migration, The NYT suggests that it could actually end up increasing migration — with mass unemployment a likely outcome in Northern Mexican cities that depend on trade with the US, it could prompt more attempts to cross the US border. The newspaper quoted Hufbauer, of the Peterson Institute, as saying: “If anything, it would promote more poverty in Mexico, which would then turn into more pressure on immigration in the US.
