Ricardo Pascoe Pierce
Trump uses the threat of tariffs to force friends and enemies to submit to his demands, using this method as if it were his “trademark.” He won the US presidency for the second time by offering immediate solutions to a wave of support from enraged and armed “haters,” billionaires rubbing their hands at the promise of unprecedented deregulation, and some rabid theorists eager to establish a new world order based on force and imposition.
In record time, he has turned the world upside down. He promised to stop the war in Ukraine immediately and proceeded to give Russia everything Putin asked for, to the detriment of Ukraine. He confronted Zelensky and demanded that he hand over control of his economy in exchange for practically nothing except a semi-surrender to the Russian army. Britain and Europe rejected Trump’s method and proposed a negotiated peace with security guarantees for Ukraine. Then, Trump’s method of imposing an agreement failed, and Russia attacked Ukraine with fury; Trump had to threaten Russia with tariffs and economic sanctions. And Russia, which has been carrying those tariffs and sanctions for years, saw it as more of the same from the West and was undeterred. The war will continue.
When faced with a complex reality that Trump’s reductionist mind had not perceived, Trump’s negotiation to impose an agreement between Russia and Ukraine stalled.
Trump then threatened Hamas with “unprecedented violence” if it did not agree with Israel on a truce greater than the ceasefire and the release of the last hostages. Hamas ignores Trump’s threat, given that with all that it has survived of Israel’s attacks, nothing that comes from the United States can be worse. Especially when Trump’s absurd and very American idea of turning Gaza into a “magnificent resort” makes palpable his lack of understanding of everything about the “Middle East.”
And then came the tariffs—the threats and retractions, the modifications in scope and duration, the new dates, and the disinformation war. What has been discussed, agreed upon, and settled? Nobody says. Neither Washington, Mexico, nor Ottawa reports what is being discussed. Things are known because they are seen: tariffs are threatened, then negotiated, and the dates rectified. Tariffs are postponed and given another date. Meanwhile, things happen in a domino effect and with no apparent logic.
In Canada, the social mood has become extremely nationalist and anti-American. Prime Minister Trudeau, who had to resign due to his unpopularity, has seen his party come back in the polls due to Trump’s grievances against them. It is in Trudeau’s Liberal Party’s interest to prolong the conflict with Trump until the elections, as it may be their best chance of retaining power. Liberals in Canada are all sighing in unison: thank you, Trump, for all the insults!
The Mexican case is different because it poses challenges and difficulties but opens up some windows of opportunity. Tariff threats are a catastrophe for Mexico. Even if they are not finally imposed on our country, their effect has been devastating for the economy and its prospects in the short and medium term. The threats and the uncertainty they cause are enough to delay or even cancel investments planned for Mexico. They also discourage consumption, both individual and corporate. Both investment and consumption are shrinking.
Mexico is projected to have negative gross domestic product (GDP) growth in 2025. This pessimistic forecast comes from two sources: negative factors inherited from López Obrador’s six-year term (excessive public indebtedness, mega-works lacking viability and demanding continued public financing, increasingly onerous social programs, and an over-indebted and inefficient energy sector—PEMEX and CFE) together with the uncertainty generated by Trump’s threats of tariffs and the possible cancellation of the USMCA.
This creates a worrying scenario: economic damage will occur regardless of whether tariffs are used. It will only be reversible long-term if many economic policy rectifications are made.
However, although Trump’s attack in Canada suited the ruling party down to the ground, it is not clear that the same will happen in Mexico. Polls give Claudia Sheinbaum 80% support in her first months in office. She has called for “national unity” by convening an event in the capital’s main square. At first, it seemed to be a broad and civic-minded call, regardless of the Morena party. However, it has progressively become a partisan meeting with demands from Morena. Among other things, in support of judicial reform, which has nothing to do with the original call.
The conditions in Canada and Mexico are very different. Canada did not withdraw its reciprocal tariffs, and now Trump has announced new tariffs on that country despite canceling them three days ago. The confrontation between Trump and Trudeau is political and electoral.
Mexico, which did not impose tariffs on the United States like Canada, has responded cautiously because the danger is much greater. The bilateral conflict concerns what US public officials have repeatedly said: they believe there is deep complicity between the Mexican government and drug traffickers. Although they have not publicly presented their evidence, they claim to have it.
This introduces an economic issue (tariffs) and a political one (regime change) into the bilateral dispute. Although the words “regime change” have not been used, it is clear that the United States has this in mind.
Trump wants to remove Trudeau and Zelensky from their positions of power through elections. In the Mexican case, the intention seems more complicated. It gives the impression that US anger is not directed at Sheinbaum but at the former President and his allies in the cabinet, state governments, and Legislative Branches. Instead, the intention seems to be to bring the leading promoters and agents of the alliance between political power and drug trafficking to US justice.
As can be seen, the intentions in the case of both sides are completely different. It is one thing to call for new elections and quite another to dismantle an entire political regime.
Therefore, the conclusion that the damage is done is not only economic but also political, as it calls for a change of regime in Mexico. Defending the change of the judiciary through elections means defending the current regime. It highlights the great contradiction between the president’s popularity, the coming economic recession, and the ideology that sustains the alliance between political power and drug trafficking. All of this ensures a continuous and deepening bilateral crisis.
The final judgment is categorical: the damage is done. Mexico’s challenge is to repair the damage and build a viable future.
@rpascoep
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