Free Trade

Trump's Claim That Mexico Will Buy More American Agricultural Goods Is Fake News

And it reveals the major blind spot in Trump's view of how international trade works.

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First things first: President Donald Trump's decision to back away from his threats to impose tariffs on goods imported from Mexico is a unambiguous victory for the American economy, for the hundreds of thousands of people whose jobs are part of that international supply chain, and for continued good relations between two deeply interconnected countries. Trump did the right thing, even if "the right thing" in this instance was simply backing down from doing the wrong thing.

But in typical Trump fashion, it apparently wasn't enough to announce over the weekend that Americans wouldn't be subject to a new $87 billion tax increase come Monday morning. Instead, Trump mashed all-caps for a tweet that bizarrely claimed Mexico had agreed to purchase more American agricultural goods in exchange for Trump revoking the tariff threat:

Remember, Trump threatened to hit Mexican imports with tariffs because he was unhappy with how the Mexican government was handling the influx of Central American refugees crossing Mexico to seek asylum in the United States. That a supposed national emergency regarding immigration across the southern border could be solved by Mexico buying more American farm goods is…well, rather odd.

Even more odd: There is nothing in the agreement between the U.S. and Mexico about agricultural goods. You can read it here; it's only about two pages long. Mexican officials have told Bloomberg that there was no discussion of agricultural issues during the tariff talks, which focused on re-separating immigration policy and trade policy—two issues that Trump unexpectedly slammed together two weeks ago.

As the story unraveled on Sunday, Trump followed up with subsequent tweets suggesting that the agricultural deal was a secret part of the agreement to be revealed at a later date. That would be highly unusual. He also whined about not getting enough credit.

In a speech this morning, Mexican Foreign Minister Marcelo Ebrard confirmed that the two nations had not reached an agriculture agreement.

Not that we need one! Mexico is already the second largest buyer of American farm goods, behind Canada. More than 14 percent of U.S. farm goods already end up in Mexico, with purchases expected to top $19 billion this year, according to the U.S. Department of Agriculture.

But Trump's misleading tweets are more than just a bizarre aside to the tariff craziness of the past two weeks. They reveal the president's biggest blind spot when it comes to understanding how trade works.

Trump doesn't seem to understand that American goods are not nationalized commodities for him to buy and sell around the world. The federal government measures how much is imported from and exported to various countries, but that's not the same as actually conducting those transactions. That may seem obvious to you, but the distinction continues to evade the president.

When "the United States" sells farm goods "to Mexico," what's really happening is a chain of private transactions. Farmers sell their products to wholesalers who sell to export brokers who sell to Mexican importers who sell to their own supply chains on the other side of the border. About the only role that the national governments of the United States and Mexico play is determining how difficult it will be to get a box of tomatoes or a bushel of corn across the border itself.

In other words, even if Mexican trade officials wanted to agree to buy more American farm goods to appease Trump, that's not something they could agree to do. Individuals and businesses on both sides do the buying and selling, privately. Mexico can't force consumers to buy American products any more so than Trump can force American farmers to sell their goods to Mexico. The complexities of those supply chains cannot be organized and controlled by central planners—or at least, they really ought not to be.

Given those realities, the best thing the Trump administration can do to boost the exporting of American farm goods to Mexico is stay out of the way. Trump may have stumbled onto that answer this time, but there's no sign he's learned the broader lesson.

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44 responses to “Trump's Claim That Mexico Will Buy More American Agricultural Goods Is Fake News

  1. My local NBC station made the same claims Trump made so who should I believe. Neither I will wait to see actions

    1. Tweets which disrupt business plans ARE actions.

      If words alone mean nothing, why do AOC and the twenty-eleven dwarves excite so many when they have no power at present?

    2. Flagged by mistake. God this website is pain.

      1. And it’s not immediately obvious what the flag is for.

      2. I’ve accidentally hit that flag ’cause it’s right in line with the button to expand comments. And sometimes when it expands the page will scroll on it’s own. And while loading, the page will sometimes expand then contract a few times.

        It’s a delight!

  2. Poor Boehm.

    Trump is able to get lower trade restrictions AND concessions on Mexico slowing the hordes of immigrants trying to flood the US Border.

    1. Your citation is missing, and perhaps that;s because there is no such citation, or perhaps it’s because poor lc1789 doesn’t do citations.

      loveconstitution1789|12.3.18 @ 10:20AM|#

      Do you need me to link the rules of NAFTA and USCMA so you can compare and contrast the “worseness” for us?

      1. Wait, you’re still claiming you’ve read either document?

    2. Boehm is an idiot.

      “Lookey! Trump said something happened that didn’t show up in this press release!”

      Mexico may very well have agreed to more imports. Not everything that happens goes into a press release, and not everything goes into the *same* press release.

  3. Another Boehm ‘Orange Man Bad’ article to kick off the week.

    1. Boehm thought the Narrative that Trump was going against the USCMA (still not ratified by the Senate) would be much juicier than it turned out by Monday.

      He had this propaganda piece on standby.

      It would be fun if propagandists like Boehm posted their other articles where the facts never panned out with the hit piece they wrote.

    2. Naw, tariffs bad. Can’t you read?

      1. I wish I was such a simpleton that I too could push purist one liners as policy. Your depth into trade is as deep as Jeff on any topic. How many headlines have you made it past regarding trade?

    3. Or you could realize, even with a brain that never past the fetal stage of development, that Trump is a terrible president, a terrible person, and the (R) after his name doesn’t change any of that.

      You stupid fucking cunt.

      1. Oye, what type of crazy White House resident believes in presurring people to buy and eat farm products?

      2. “Orange Man Bad, you stupid cunt!”

        The level of emotional hysteria is proportional to the losing.

  4. Along similar lines today, Trump and random-protectionism-memes lately…

    President Trump has announced new, off-the-legislative-books, spur-of-the-moment, 90% tariffs on ALL new incoming exports from Brazil!

    In a statement, President Trump twittered, “I’ve heard about literally tens of thousands of Brazilian soldiers, armed and ready to make war, any war called on the behalf of the Brazilian State. This many Brazilians of soldiers is CLEARLY excessive! Destabilizing! I’m not a fan of Brazilians of soldiers anywhere! So till they make themselves content with a mere few bazillions of soldiers instead, we’re going to have to tariff them and make them pay for it!”

    See https://www.youtube.com/watch?v=qLrnkK2YEcE for more details…

  5. I want to object to the term “fake news” used in the headline. Fake news is news media or fake news media creating and distributing stories that they made up. This story is the president lying, which is not fake news. At worst the media is parroting the presidents false statements.

    1. Technically, as it is a prediction concerning the future, it can only be a “lie” if Trump has done something he intends have the opposite result. Because there isn’t yet any objective truth to be aware of, and deliberately contradict.

      For instance, it was a “lie” when Obama said, “If you like your policy, you can keep it.”, because the question had already come up in internal discussions within the White house, (As later revealed by somebody involved in them.) and they knew when he said it that the ACA would have the opposite effect, indeed, intended that it have the opposite effect.

      It’s quite possible that Trump thinks his current policy will have that effect, even if you assume he’s mistaken on that score. It would still only be a “mistake”, not a “lie”.

      1. Broadly speaking, your definition of “lie” vs. “mistaken” works.

        When it comes to compulsive liars who believe their own bullshit though, it breaks down.

      2. It’s not “technically” a “prediction.” It’s right there in Trump’s own words: Mexico “has agreed” to “immediately begin buying large quantities” of agricultural products from American producers.

        Mexico denies entering into any such agreement, and the idea that there could be such an agreement beggars belief in the first place. Trump is a liar.

        It’s part and parcel with several other “unpresidented” agreements Trump has entered into or attempted to enter into, as with the EU and China. Parties to these agreements somehow are said to have “agreed to buy” American agricultural products, the exact mechanism of this always being left unstated, the actual implementation left… well, who knows. It seems these countries make these silly promises to Trump and hope he forgets all about it after a few news cycles. Which he reliably does.

  6. “MEXICO HAS AGREED TO IMMEDIATELY BEGIN BUYING LARGE QUANTITIES OF AGRICULTURAL PRODUCT FROM OUR GREAT PATRIOT FARMERS!”

    +1 for puerility.

    1. “OUR GREAT PATRIOT FARMERS” sounds like something you’d hear from a communist regime.

      1. The HateAmericaFirst crowd just can’t stand people who love America.

        1. No, what we can’t stand are hypocritical communist farmers who suck Uncle Sam’s dick in exchange for billions in taxpayer subsidies every year. And we also can’t stand the fact that these same pinko, cum-guzzling farmers vote into office our current fucktard of a president who agrees to give them more of our hard-earned money because they claim to have disproportionately suffered from tariffs that the aforementioned fucktard levied against China. If these people are your definition of patriots, you can get on your knees with the rest of them and fellate away. Personally, I’d rather be a hater.

  7. Oh, stupid man. Everything Trump says is true, good, righteous, and revelatory. Has there ever been a human being more wise? Just ask the “libertarians” who populate this message board.

    1. The irony of Tony is palatable. Now do the reverse to describe yourself.

    2. Tony you worthless bitch, the agony Trump causes you makes me like him more.

  8. There’s that “not taking him seriously but taking him literally” TDS again.

  9. “supposed national emergency regarding immigration across the southern border”

    Supposed.

    I know! As if! OMG! I cannot even.

    1. I thought “separating children from their parents” was the worst humanitarian crisis since Auschwitz?

      Oh, that’s right, I forgot.
      “Consistency is a social construct of the white supremacist cisheteropatriarchy used to oppress marginalized peoples”

  10. Gee, did anyone predict that Trump was using the threat of tariffs to enact a change in policy rather than the dumb, “Trump LOVES tariffs” mantra? Was it someone who writes for Reason? No. Oh yeah. Now I remember. It was me.

    1. Yes, but you must admit that having to predict what the fuck Trump might possibly mean by the random shit he says is a bit of a problem. It kind of defeats the whole purpose for inventing language, don’t you think?

      1. What random shit? He explicitly said the only purpose of the tariff threat was to coerce Mexico into changing its policy. Though he’d be ok with taking the money if they took a while complying.

        It’s pretty stupid when somebody says, “I’m doing this to achieve X”, X happens, and you declare it wasn’t their goal.

        1. The open borders crowd isnr exactly known for reasoned or honest discussion.

        2. What do you mean by “he’d be ok with taking the money”? You know how tariffs work, right? Mexico doesn’t pay them, we do. He’s taking YOUR money, dumbshit.

          For people who purportedly hate taxes, Trump folks sure love taxes.

          1. That’s why I said “the” money, rather than “their” money, dumbshit.

            Also, I didn’t sleep through Econ 101 in college, so I’m aware that the actual cost of a tariff ends up getting split between both sides in a fairly complex way.

      2. The good thing is that he is predictable in all the random shit so most everyone just ignores it.

  11. just before I looked at the paycheck four $6755, I accept that my friend could realey making money in there spare time online.. there friend brother haz done this less than 22 months and resently cleard the morgage on their appartment and purchased a great new Acura. I went here,

  12. If we get any tradier with Mexico, we’ll be shipping them American-made tequila.

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