Trump Suggests Mexico May Not Face 25% Tariff
President-elect Donald Trump said the U.S. is "subsidizing Canada to the tune [of] over $100 billion a year. We’re subsidizing Mexico for almost $300 billion. We shouldn’t be -- why are we subsidizing these countries? If we’re going to subsidize them, let them become a state."
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He exaggerated -- the trade deficit in goods with Canada was $72 billion in 2023, and $161 billion for Mexico -- but Trump has long seen it as proof of cheating or poor U.S. policy when U.S. consumers buy more goods from a foreign country than that country buys in U.S. exports.
The "state" comment seemed to be extending a joke he made during a meal with Canadian Prime Minister Justin Trudeau. Canadian officials said Trump teased Trudeau, saying if he didn't like the prospect of 25% tariffs, why not make Canada the 51st state?
Trump, who granted his first post-election interview to Meet the Press, brought up the trade deficits right after saying tariffs are going to make the U.S. rich.
Meet the Press host Kristen Welker asked Trump: "Are you actually going to impose these tariffs or are they a negotiating tactic?"
Trump said that "within 10 minutes after that phone call" with Mexico's president, the number of migrants coming into the U.S. from Mexico was a trickle. Trump said he called down to the border, and "said, 'How’s the border looking today?' They said, 'There’s nobody here.' They couldn’t believe it. The military stopped these vast groups of people. You know, we call them caravans. But they had caravans of people, and they largely stopped them. Now, they’re going to have to continue that, but if they don’t continue -- and the other thing I told them is no more drugs."
Welker pressed Trump on the consequences of tariffs, saying Walmart and others are saying prices will go up, and noting prices went up on washing machines as a result of first-term tariffs.
"They cost Americans nothing. They made a great economy for us. They also solve another problem. If we were going to have problems having to do with wars and having to do with other things, tariffs -- I have stopped wars with tariffs by saying, “You guys want to fight, it’s great. But both of you are going to pay tariffs to the United States at 100%. And they have many purposes, tariffs, if properly used. I don’t say you use them like a madman. I say properly used,” Trump said.
He said if the market doesn't respond the way he expects, "we adjust it somewhat." However, he defended the safeguard tariffs on washing machines as saving tens of thousands of jobs, "and you don’t include that in your equation."
He added that tariffs will help the government "pay off $35 trillion in debt."