As a candidate, Donald Trump promised Americans that he would build a wall on our border with Mexico, and that they would end up paying for it. At the time it was little more than feel-good rhetoric but now that he is President of the United States, he is making good on it.
The only problem is, Mexico’s President has asserted that he in no way intends to pay for our wall. Trump, fortunately, has some other suggestions.
According to Fortune, the wall that Trump plans on building on the border is going to cost somewhere in the neighborhood of $15B, much more than he had originally predicted.
That is an additional cost that the taxpayers of America simply cannot bear, so Trump has to make this work. But with the Mexican President refusing to cooperate, how is he going to do it.
Trump has suggested that we institute a 20% tax on all goods coming into America from Mexico. While that doesn’t seem like a lot, let’s look at how the math shakes out.
U.S. goods and services trade with Mexico totaled an estimated $583.6 billion in 2015. Exports were $267.2 billion; imports were $316.4 billion. The U.S. goods and services trade deficit with Mexico was -$49.2 billion in 2015.
Mexico is currently our 3rd largest goods trading partner with $531 billion in total (two way) goods trade during 2015. Goods exports totaled $236 billion; goods imports totaled $295 billion. The U.S. goods trade deficit with Mexico was $58 billion in 2015.
If we taxed just imported goods, we would be getting 20% of around $295B. If we did this for just one year, we would make a total of $59B, or enough to build almost 4 walls!
How amazing is that! It wouldn’t even have to last the entirety of his Presidency and it would be over and done with. Let’s hope he decides to go this route.