The Looming Tariffs

In an effort to throw away the carrots and invest in new sticks, the new American administration has decided to use the economic and political weight of the United States to address non-trade policies with many of its traditional economic allies. One of the most notable instances of this strategy was used to encourage NATO members to increase funding for security, pulling funding obligations away from the United States for security issues abroad. While this tactic was not taken seriously at the time, the coming war between Ukraine and Russia proved it to be a useful shift. With all of Ukraine’s allies now contributing in the billions of dollars, compounded with the United States’ own significant contributions, Ukraine has been able to put up a historic level of resistance against Russian aggression.

More recently, President Trump has focused his energies on local issues within the United States connected to a poor border strategy. While trade has always been the focus of relations between NAFTA neighbours, the United States will use tariffs to enforce actions against drug trafficking and terror issues that are lacking on both sides of the Southern and Northern borders. With security issues being the main concern, it is likely the case that increased actions against Fentanyl and terror threats would benefit both the US, Mexico and Canada. The question then remains, whether the trade partners are aware of such benefits, and whether or not they will use local impressions of the US to bolster their own political fortunes?

Mexico, who had their own election fairly recently, had put back the same party in power with a new leader for the next six years. Despite the current party being of a left wing orientation, Mexico’s approach in re-signing the USMCA Agreement focused deeply on Mexican commercial interests. Mexico’s Government in the following years seemed to respond to US policy by mirroring the Biden Administration’s actions on the border. With very apparent border issues with US policy over the last four years, Mexico sought to limit the negative effects within Mexico itself during that period of time. The effect of record breaking migrations passing through Mexico put a great burden on Mexico’s social security system, encouraging Mexico to either prevent migrants on their own southern border, or allow them to reach the US border so they do not remain in Mexico. With the US border being the target of most migrants, Mexico chose the latter strategy in response to the lack of US border enforcement.

The eruption caused by abuses of the Maduro Government in Venezuela resulted in one of the largest refugee populations in modern times crossing through Latin America, Mexico, and the United States. While many Venezuelans have proper refugee claims due to their treatment under the Maduro regime, the chaos created by mass migrations out of Venezuela was used to transmit organised crime through the same routes used by many of these refugee claimants. These issues affected Mexico and many Latin American communities in the region, and were apparent in those communities in the United States months before it became the focus of the last US election. Spanish language news within the US would constantly put out reports of violence from those specific gangs that seemed to be frequent, coordinated, and ignored by most English language media, until it was no longer possible to ignore. Mexico clearly benefits in the US addressing their border issues and coordinated crime coming over the border as it has a negative effect on Mexico as well. Mexico is a net beneficiary to stable relations with the US, especially if it reduces its political ties with China in the process.

The Fentanyl Crisis has reached the point of inducing the tariff strategy on former NAFTA partners. US media has been detailing base ingredients being sent from China to Mexico for final production and export via cartel networks. Mexico and the US should immediately take a coordinated response to the imports from China and cartel control over the border. With many international companies Nearshoring their China based manufacturing to Mexico, the US-Mexico border can likely evolve into the manufacturing hub of the globe that was envisioned in 1994’s initial NAFTA agreement. Ever since China joined the WTO, Mexico had directly suffered from the loss of manufacturing to China, in 2025, this is no longer the case. With Mexico displacing part of China’s manufacturing base, Mexico may be entering its most successful period ever, if it can shrug off negative ties to China. Since the tariff is a security issue for President Trump, Mexico may find it easier to implement its own security with a strong US border in a win-win scenario.

Canada has often been able to avoid criticism, but has had many issues over the last few years that have raised the ire of the incoming US Administration. Fentanyl and drug issues on the Canadian border have risen dramatically, but the shocking statistics showing security issues related to terror threats as well and China’s influence over the current Canadian Government is shocking to both Americans and Canadians alike.

The response to the tariff threat has been absurd on the Canadian side, firstly concentrating it solely on trade when it was openly stated as a security issue, and now evolving into a near complete collapse of the Canadian Government in power. When communications from regional Provincial leaders toward the incoming US Administration displaced the Canadian Government’s own coordinated responses, the Premier of Quebec and the other Provinces collected themselves together to become Team Canada, without a proper Canadian Government spokesperson to respond to the security issues. With Justin Trudeau, it looks like he is planning to openly fight Trump to the detriment of all Canadians big and small, despite his Government creating one of the largest national deficit’s ever seen in Canada. Canada is considered quite dangerous for some cultural groups as well, more dangerous than it has been in generations, with security issues in Canada now famously being seen globally on a weekly basis. With a passive response by the Trudeau Government on the murder of Canadians on Flight 752 by Iran’s regime, Trudeau is now taking his less than 20% approval rating and choosing the opposite response against the Americans. Trudeau’s 2025 election strategy looks to use a Twitter fight with President Trump to garner local support. The first move however was against the US voter, ensuring his Government will incur tariffs in response. The error of being a foreign leader who makes public statements against all of those Americans who voted for their President is inappropriate on the best of days.

While Mexicans, Americans and Canadians benefit from increased border security, a lesson on consequences for voters is working rapidly in real time. The North American region can become the most economically successful region over the next few generations, if leaders in those countries can work towards benefitting their own communities and supporting each other’s economic growth over their own personal benefits. Without this basic level of awareness, tariffs will likely become a reality in 2025 for many in North America and abroad.