Mexico and Canada could avoid tariffs if they act against drug trafficking, says Trump for Trump for Department of Commerce

CNN
–

As several of Trump’s chosen for key positions, the candidate to direct the Commerce Department participated on Wednesday of his Senate Confirmation Hearing, where his suitability for office is being questioned.

There, candidate Howard Lutnick told legislators that he prefers “generalized” tariffs, instead of selective tariffs.

“My way of thinking, and I talked to the president, it is country by country. Macro, ”said Lutnick.

He also reiterated Trump’s comments that tariffs could help strengthen United States leadership in the world and added that they could help US farmers prosper.

On the tariffs to Mexico and Canada that Trump has spoken, Lutnick said that they will not be implemented if those countries take measures in drug trafficking, but that there is another batch of encumbrances that will be decided at the end of March or in April, in April, Efe reported.

According to him, Trump’s order is to study two types of tariffs and that the former are focused “to end the fentanyl that arrives” to the United States and for “that our partners stop missing respect.”

“It’s not a tariff per se. It is a domestic policy action; Close their borders and stop the fentanyl that enters our country and kills people. It is a tariff to get actions in Mexico and Canada. And as far as I know they are acting quickly and if they continue like this there will be no tariffs, ”said Lutnick quoted by EFE, that he should not have difficulty being confirmed in a Senate dominated by Republicans.

In addition, the Exceus of Wall Street made a bold statement about tariffs: he said they will not make prices rise.

“The price of a particular product can rise, but all? It is not inflation, ”said Lutnick at his confirmation audience this Wednesday. “The two main countries with tariffs, India and China, have the greatest amount of tariffs and no inflation. It is simply nonsense that tariffs cause inflation, it is nonsense. ”

Lutnick is right that, in certain circumstances, tariffs do not cause inflation problems. For example, Trump’s first mandate tariffs did not significantly increase inflation, although they were much more limited in the scope of what is currently being raised, and the pandemic that followed some of the inflationary aspects of the tariffs, many of which many of which They remained in force during the Biden administration.

However, in general economists agree that tariffs do cause inflation. This is because importers (not the export countries of the goods) pay the tax, and normally transfer that cost to consumers in the form of higher prices. A new research from the Peterson Institute of International Economics suggests that Trump’s aggressive tariff campaign will force US consumers to pay more for practically everything, from shoes and toys made abroad to food.

Even so, some defenders of Trump Plan say the risk is worth it. Jamie Dimon, CEO of JPMorgan, told the CNBC last week that if tariffs cause some inflation but address a national security problem, then people should “overcome it.”

Lutnick said that, if confirmed, it will implement tariffs against China as part of the AI ​​global war. “Chinese tariffs should be the highest. Our adversaries should have to pay the highest, ”he said Wednesday.

“We have to find a way to support our export controls with tariff models to tell China: ‘Do you think we are your most important commercial partner? When we say no, it’s no, ”said Lutnick.

“It is a matter of respect. They have lacked respect, have discovered ways to avoid it, ”he added.

Lutnick also said he does not believe that China has legitimate deepseek, a Chinese emerging company that shook world markets this month with a new AI model.

“They stole things, they entered, our intellectual property took,” he said.

Lutnick said that, under President Donald Trump, the country must focus on being the leader in artificial intelligence.

This publication has been updated with Lutnick’s comments.