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Just To Be Clear, Mexico Is in No Way Paying for the Border Wall

No, the USMCA will not finance the border wall, as Trump has claimed. It’s American taxpayers who would foot the bill

President Donald Trump speaks during a cabinet meeting at the White House, in WashingtonTrump, Washington, USA - 02 Jan 2019

President Donald Trump speaks during a cabinet meeting at the White House.

Evan Vucci/AP/REX/Shutterstock

President Trump doesn’t have much to cling to as he enters his third year in office. He can claim that he’s followed through on campaign promises like tearing up the Iran nuclear deal, moving the U.S. embassy in Israel to Jerusalem and pulling the United States out of the Paris climate agreement. But he hasn’t built a border wall, the prospect of which was the foundation of his 2016 campaign. Not only did Trump promise to erect a wall along the nearly 2,000 miles that separate the United States from Mexico, he promised Mexico would pay for it. The nation’s officials have on several occasions denied they will do so, but Trump hasn’t wavered. As the president prepared to sit down with congressional Democrats to discuss the wall on Wednesday, he took to Twitter to reiterate that it will come at no cost to the United States.

Trump has long struggled to explain how and why Mexico would pay for a border wall, only that it will happen. In August 2017, he tweeted that Mexico’s wall financing will come through “reimbursement/other,” but did not elaborate. That was about as good as he could do until last month, when he began attempting to argue that the money will come through the USMCA, or the United States-Mexico-Canada Agreement, the president’s chosen moniker for his November rebrand of NAFTA, the agreement that has governed trade between the three nations since 1994. “I often stated, ‘One way or the other, Mexico is going to pay for the Wall,” Trump tweeted in December. “This has never changed. Our new deal with Mexico (and Canada), the USMCA, is so much better than the old, very costly & anti-USA NAFTA deal, that just by the money we save, MEXICO IS PAYING FOR THE WALL!”

When asked to elaborate by reporters, Press Secretary Sarah Huckabee Sanders said only that Trump has “been clear” that the money will come from the USMCA. The president continued to insist Americans won’t have to finance for the wall, tweeting on New Year’s Eve that “MEXICO IS PAYING FOR THE WALL through the many billions of dollars a year that the U.S.A. is saving through the new Trade Deal, the USMCA, that will replace the horrendous NAFTA Trade Deal, which has so badly hurt our Country.” He added that “Mexico & Canada will also thrive — good for all!”

But the USMCA, which has yet to be ratified by Congress, doesn’t differ from NAFTA in any way that would result in a substantial revenue increase. As the New York Times pointed out last month, the new provisions added deal mostly with automobile manufacturing, intellectual property rights and access to Canadian dairy, which Trump has tweeted about at length. “It’s much harder to connect actual provisions of the USMCA to cash for the wall, since they don’t put money in the coffers of the Treasury,” Gary Hufbauer, a senior fellow at the Peterson Institute for International Economics, told the paper. “Any connection between labor, auto rule of origin and other chapters to the wall is pretty remote.” Chad Brown, one of Hufbauer’s colleagues at the Peterson Institute, told CNBC that he expects “essentially zero change in revenue collected from tariffs arising through the USMCA” seeing as both NAFTA and the USMCA charge no tariffs on trade with Canada and Mexico, just as was the case with NAFTA.

Regardless of Trump’s contention that Mexico will pay for the wall, he let the government partially shut down on December 21st because Democrats wouldn’t agree to allocate $5.6 billion of taxpayer money to begin construction. The president has claimed repeatedly and falsely, including in Wednesday morning’s tweet, that construction on the wall has already begun. On Christmas Eve, he that he “gave out a 115 mile long contract for another large section of the Wall in Texas,” something he is not authorized to do and which the White House has yet to explain. If at some point construction does begin, and is seen through to completion, it could cost taxpayers — not Mexico — as much as $70 billion.

Though Trump touted that he stayed in Washington, D.C., for the holidays so he could work on ending the shutdown — which has left 800,000 federal employees without paychecks — it’s unclear what he was doing other than tweeting. On Wednesday, he will meet with congressional Democrats, who have shown no signs of giving into Trump’s demands. “Border Security and the Wall ‘thing’ and Shutdown is not where Nancy Pelosi wanted to start her tenure as Speaker!” he tweeted desperately on Tuesday. “Let’s make a deal?”

Before meeting with Democrats on Wednesday, however, Trump prompted the notions of “walls” while speaking to his Cabinet. On the table, inexplicably, was a poster of “Sanctions Are Coming” meme he tweeted prior to the midterms.

Trump added that his job would be “a lot easier if I just relaxed and enjoyed the presidency like a lot of other people have done.”

In This Article: Donald Trump

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