WASHINGTON
PALM BEACH, Fla. — President Donald Trump signed an order Saturday to impose stiff tariffs on imports from Mexico, Canada and China — fulfilling one of his commitments to voters that also carries economic risks.
Trump’s order also includes a mechanism to escalate the rates if the countries retaliate against the U.S., as they warned they would.
The decision throws the global economy and Trump’s own political mandate to combat inflation into possible turmoil, though the Republican president posted on social media that it was necessary “to protect Americans.”
The tariffs would go in effect Tuesday. They risk an economic standoff with America’s two largest trading partners in Mexico and Canada, upending a decades-old trade relationship with the possibility of harsh reprisals by those two nations.
The tariffs also could cause inflation to significantly worsen, possibly eroding voters’ trust that Trump could as promised lower the prices of groceries, gasoline, housing, autos and other goods.
Trump declared an economic emergency in order to place duties of 10% on all imports from China and 25% on imports from Mexico and Canada. But energy imported from Canada, including oil, natural gas and electricity, would be taxed at a 10% rate.
A new analysis by the Budget Lab at Yale laid out the possible damage to the U.S. economy, saying the average U.S. house-hold would lose the equivalent of $1,170 in income from the taxes. Economic growth would slow and inflation would worsen — and the situation could be worse if Canada, Mexico and China retaliate.
Mexico plans to stay coolheaded as it weighs its options. President Claudia Sheinbaum, appearing Saturday at an event promoting a government housing program outside Mexico City, said, “I’m calm, I’ve been saying since yesterday, because I know that Mexico’s economy is very powerful, very strong.”
A senior Trump administration official, insisting on anonymity to brief reporters, said the lower rate on energy reflected a desire to minimize any disruptive increases on the price of gasoline or utilities.
The order signed by Trump contained no mechanism for granting exceptions, the official said, a possible blow to home-builders who rely on Canadian lumber as well as farmers, automakers and other industries.
The Trump administration put the tariffs in place to force the three countries to stop the spread and manufacturing of fentanyl, in addition to pressuring Canada and Mexico to limit illegal immigration into the United States.
The official did not provide specific benchmarks that could be met to lift the new tariffs, saying only that the best measure would be fewer Americans dying from fentanyl addiction.
The order also would allow for tariffs on Canadian imports of less than $800. Imports below that sum currently are able to cross into the U.S. without customs and duties.
The president is preparing more import taxes in a sign that tariffs will be an ongoing part of his second term.