Mexico throws counterpunch in trucking dispute(Read article summary)
The tariffs target US states with an eye toward maximum political impact.
Mexico threw a series of precise counterpunches at the US ban on 18-wheelers on Thursday.
Bang! It hit shipments of grapes from California with a 45 percent tariff.
Bam! Sunflower seeds from North Dakota were tagged with a 15 percent duty.
Mexico is the third-largest US trading partner, after China and Canada. The tariffs that went into effect Thursday will hit some $2.4 billion goods across 40 states. That’s likely to mean lost American jobs during one of the worst recessions in recent memory.
The response was not unexpected. You can read it about it here: “Mexico’s punitive tariffs raise stakes on US trucking dispute”
But what’s noteworthy is not the breadth of Mexico’s retaliation. It’s the political accuracy of their tariff targeting.
FRUITS AND NUTS
The shot at California fruit and nut producers is designed to get the attention of Democratic House Speaker Nancy Pelosi.
Pears, trees, and potatoes?
That’s designed to focus the attention of Oregon’s Congressman Peter DeFazio, who called Mexican trucks unsafe. Representative DeFazio, it turns out, is a member of the House Transportation and Infrastructure Committee.
Mexico is the largest export market for pears, and the weak peso had already led to a drop in demand there, Jeff Correa, international marketing director for the Pear Bureau Northwest in Oregon told Bloomberg News. A 20 percent tax on top of that could “push us entirely out of the market,” Correa said.
That combination alone could cost Oregon more than $80 million and about 1,000 jobs, according to the Oregonian. All told, an estimated 40,000 US jobs could be at risk.
WHAT'S UP WITH SUNFLOWER SEEDS?
What does Mexico have against North Dakota sunflower seeds?
Probably nothing. But Democratic Sen. Byron Dorgan hails from the Canadian border state. And he has no love for NAFTA or Mexican long-haul trucks. He sponsored the amendment last week that closed the US-Mexico border on the grounds that Mexican trucks were unsafe.
It’s not exactly a new issue for him. When he endorsed Barack Obama for president more than a year ago, he said, “Senator Obama has never felt … that NAFTA was good for America… He and I feel the same way.”
He also published the book “Take This Job and Ship It: How Corporate Greed and Brain-Dead Politics Are Selling Out America.”
President Obama has pledged to work with Congress to find a solution to the trucking impasse. We’ll soon see if Mexico’s pinpoint tariffs have helped focus the attention of members of Congress or not.