Tariffs are too blunt a tool for migrant talks with Mexico

A late-Friday U.S.-Mexico deal avoiding tariffs being imposed on Mexico this week came as a huge relief for the U.S. economy and for the broader vital relationship with Mexico. But we’re not out of the woods yet.

When President Trump announced blanket tariffs on Mexico to force an even greater response to unauthorized migration, economists were quick to — rightly — warn of the massive collateral damage that would be inflicted on the U.S. economy.

But the conversation can’t end there, especially since Trump has refused to take tariffs off the table even with a deal. The damage wouldn’t just be collateral. Tariffs would also directly undermine their own stated goal: curbing northward migration.

Tariffs, as is widely understood, amount to a consumption tax on the levying country. With Mexico now officially the U.S.’ largest trading partner, American businesses and consumers would expect to see prices shoot up for everything from cars and trucks, to computers and cell phones, to gasoline.

But tariffs wouldn’t leave Mexico unscathed — not by a long shot. That’s because our relationship with Mexico is unlike any other the U.S. has. It goes far beyond a trade relationship. What we have is a production relationship.

We manufacture products together in line with our respective comparative advantages. We move components back and forth across the Rio Grande countless times during production, allowing both of our countries to be far more competitive on the global stage than we would be otherwise.

So intimately linked are our supply chains that 40 cents’ worth of every dollar imported from Mexico is actually U.S. content. 

That means that tariffs would be far more damaging to the U.S. than similar tariffs on China, but also that Mexico would be impacted far more than China. Using the president’s logic, that gives the tariffs real teeth to force Mexico into action on migration. And that is what he sees as being accomplished on Friday. But that entails ignoring two key truths. 

The first is that Mexico is already doing a great deal to curb migration — more now than ever before, in fact. And the second is that Mexico’s capacity to stem migrant flows is directly tied to the strength of its economy. 

President Andrés Manuel López Obrador (AMLO), despite heated rhetoric during his campaign, has shown a tremendous amount of goodwill toward the U.S. during his first six months in office. And perhaps in no area more so than on migration.

Under his administration, Mexico is on track to process nearly 60,000 Central American asylum claims this year, an almost 100-percent increase over 2018. Apprehensions and deportations of unauthorized migrants in the first six months of 2019 have increased by nearly a third compared to the same period last year. 

Mexico has been pouring an enormous amount of its limited resources into clamping down on migrant flows heading to the U.S. Yes, the number of Central Americans crossing through Mexico is dramatically up, but so is Mexico’s response. 

That’s because it doesn’t benefit Mexico or the United States to have unauthorized migrants making their way through Mexican territory. Now Mexico has committed even greater resources and emphasis to clamp down on migration at its southern border, with a review of progress in 90 days. That review should be cognizant of the fact that a wholesale reversal of migratory flows is no easy task.

Crucially, alongside the near-term strategy of increased enforcement, Mexico is implementing a longer-term plan to address migration at its source. The country has pledged $30 billion in development projects in Central America to mitigate the widespread poverty and insecurity that drive families to leave in the first place. Make no mistake; this is the only sustainable solution to the migrant crisis.

But instead of working with Mexico to expand this development strategy and give it real legs, Washington has decided to cut the very aid programs that were meant to give Central Americans the means to stay.

That is moving in the wrong direction, actively undercutting our joint efforts to stem migration. U.S. partnership with Mexico to stem migratory flows means also working together — and investing the joint resources — to reduce the incentives for people to leave.   

No clear benchmark has been set so far as the actual reduction in unauthorized migrants that would satisfy the president. But tariffs shouldn’t be the answer if flows do not decline immediately. In fact, such action, which would deal a blow to an already struggling Mexican economy, would only compound the problem.

Hurting Mexican coffers at a time when the country is planning to invest so heavily in its Central American development strategy is among the most counterproductive moves one could fathom.

If that weren’t enough, bringing economic pain to Mexico could also reverse the recent trend of negative net migration from the country into the U.S., which had been driven by Mexico’s strong economic performance. 

To be sure, the flow of unauthorized migrants arriving at our southern border is unsustainable, and there is more to be done. But as officials from both countries now work to implement a long-term plan, the blunt instrument of tariffs should be taken off the table moving forward.

The U.S. and Mexico have long wagered on a close partnership to address our mutual challenges. Abandoning that approach now in favor of coercion and antagonism would only end badly — for both of us.

Jason Marczak is the director of the Atlantic Council’s Adrienne Arsht Latin America Center. He is on Twitter at @JMarczak.