Trump threatens Mexico with even higher tariffs

By David Goldman, CNN

(CNN) — President Donald Trump on Monday said Mexico was treating America’s farmers unfairly, and he threatened the country with his favorite economic weapon: Higher tariffs.

Trump said in a Truth Social post that Mexico is violating its water treaty with the United States, hurting Texas farmers’ ability to nourish their crops and livestock.

“As of now, Mexico is not responding, and it is very unfair to our U.S. Farmers who deserve this much needed water,” Trump posted Monday. “That is why I have authorized documentation to impose a 5% Tariff on Mexico if this water isn’t released, IMMEDIATELY.”

The treaty Trump is referring to is the Utilization of Waters of the Colorado and Tijuana Rivers and of the Rio Grande Treaty signed in 1944. Among other things, it requires that the United States receive an average of at least 350,000 acre-feet of water from Rio Grande tributaries each year.

The United States for decades has accused Mexico of shirking its responsibilities.

The International Boundary and Water Commission, a US government agency, estimates that Mexico has underdelivered on its water obligations to the United States by 73,000 acre-feet over the past five years. Mexico could be bound by the treaty to make up the difference over the subsequent five years, although that largely depends on the countries’ interpretation of an undefined “extraordinary drought” condition set forth by the treaty.

Texas is currently in a drought, with some farmers unable to sufficiently water their crops or livestock. Local lawmakers and congressmembers have raised the issue – even introducing a bill earlier this year that would punish Mexico but went nowhere.

Texas Republican Jodey Arrington said last year in a House Ways and Means Committee hearing that the lack of water resources from Mexico has led to a $1 billion loss in irrigated crops in his state.

Trump has spoken out about the issue before. In an April Truth Social post, Trump similarly threatened an unspecified tariff and potential sanctions against Mexico if it failed to release the water it owes to the United States.

Mexico is America’s largest trading partner, and a 5% additional tariff would raise the tax on Mexican goods imported to the United States to 30%.

But it’s not clear how much the tariffs will matter, if they’re imposed at all. The vast majority of Mexican goods are currently exempt from Trump’s tariffs, provided they comply with the overriding US-Mexico-Canada free trade agreement.

But that agreement is set to undergo a review in July, and the Trump administration has signaled its willingness to let the free trade agreement expire.

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