Trump’s tariffs on Canada and Mexico will hit working Americans hard. Will they sour on his policies?
By Dean Baker, CEPR
The waiting is almost over, Donald Trump is about to hit America’s workers with the largest tax increase they have ever seen. Trump’s taxes on imports (tariffs) from Canada, Mexico, and China will cost people in the United States somewhere around $400 billion a year or around $3,000 a household.
This is far larger than any tax increase we’ve seen in the last half-century, and unlike tax increases put in place by Clinton and Obama, it will primarily hit low and middle-income households. Their tax increases primarily hit the top 1% percent, which is probably why they got so much more attention from the media.
It is not clear what our reality TV show president hopes to accomplish with these tax hikes. His stated reasons don’t make much sense. Canada, Mexico, and China are already cooperating with the U.S. on the issues he is complaining about. There is a minimal flow of fentanyl and undocumented immigrants from Canada.

Mexico sharply curtailed the flow of undocumented immigrants following a deal with Biden last summer. We can look to reduce the flow further, but that could probably be accomplished by negotiations rather than imposing a big tax on U.S. households.
China has also cooperated in reducing the flow of precursor substances for making fentanyl. Here also there were probably better prospects for further reductions through a path of negotiations rather than Donald Trump’s big tax increases.
Also, unlike Canada and Mexico, China’s economy is not that dependent on its trade with the U.S. China’s exports to the U.S. come to less than 2.5 percent of its GDP. If Donald Trump’s taxes reduce that by half, it could look to export to other countries (like Canada or Mexico) or increase domestic demand.
It seems implausible that Donald Trump’s stated reasons for his tax increase are his actual reasons. In principle, taxes on imports can be used as part of an industrial strategy to build up key industries, as was explicitly the case under Biden. His tariffs were intended to promote the advanced semi-conductor industry, as well as solar and wind energy and electric cars.
Recent Posts
New Poll: Democratic Socialism Is Now Mainstream
September 17, 2025
Take Action Now A national poll from Jacobin, DSA Fund, and Data for Progress finds broad support for democratic socialist leaders and left-wing…
Gerrymandering & The War On Democracy
September 17, 2025
Take Action Now It’s one piece of a much larger democratic breakdown.By RJ Eskow, The Zero Hour Report A few days before the Charlie Kirk…
What Happened To Silverio Villegas González
September 17, 2025
Take Action Now Immigration agents shot and killed an unarmed 38-year-old father outside Chicago on Friday—and their initial narrative of events was…
Talk World Radio: Sam Rosenthal On The Occupation Of DC And What’s The Matter With Democrats
September 16, 2025
Take Action Now War, peace, and politics with RootsAction’s Political Director Sam RosenthalBy David Swanson and Sam Rosenthal, Talk World Radio…