Over the past week or so, President Trump is taking the border war to a new extreme. He’s now blaming Mexico, at least in part, for the problem. He’s saying they’re not doing enough to stop illegal immigration into the U.S. In the last few months we’ve seen large caravans of people cross Mexico unimpeded. Their destination? The U.S. border.
As a supposed threat to Mexico, Trump is now saying he will shut it down. The whole enchilada. He tweeted on Friday that he would shut down the border “If they (Mexico) don’t stop them, we are closing the border. We’ll close it. And we’ll keep it closed for a long time. I’m not playing games.” Is this something that could really happen? Moreover, how would it impact us?
Crisis at the U.S. Border?
Many might look at the southern border and think it doesn’t impact them much. What goes on down there stays down there. But in reality, there’s a real economic impact to how the border is operated. When President Trump says there’s a national crisis, what does that mean? Also, are the Democrats correct when they say there is no national crisis?
Such an event was not just created out of thin air. The problem of illegal immigration has been addressed since well before Trump. You can watch videos of Obama, Bush 2, Clinton, Bush 1, and Reagan talking about it. The need for tighter security, a better immigration policy, and more have been priority. At least, it was a priority at election time.
The U.S. Southern border has been a mess for a very long time. Over the past few decades, it’s been estimated that as many as 20 million illegals have crossed. FAIR estimates that number to be 12.5 million illegal aliens. They also estimate that over $134 billion is spent each year to care for these illegals.
So, the question remains. Is Trump justified in shutting down the U.S.-Mexico border? It really depends on what side of the fence (no pun intended) you’re on. Whether it’s an emergency is debated, but no one can deny there’s a massive problem. It’s a growing problem that needs to be addressed ASAP.
The Cost of a Closed Border
Another major question that needs to be asked is the economic impact of closing the border. Well, the results would most likely be devastating. For one, America is already locked in a trade war with China. The economic impact of this locking of horns has been far-reaching. The two world’s largest economies fighting each other is not good for the world.
Secondly, Mexico is America’s third-largest trading partner. Unlike the issues with China, completely closing the southern border would prevent imports and exports. Auto parts, food, and other goods and services would be completely blocked. This directly impacts 1.2 million jobs. $615 billion worth of these goods are imported each year.
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44% of the imported produce in the United States comes from Mexico. Important foods that are staples to the American diet. They include things like avocadoes, cucumbers, tomatoes, and raspberries. Prices of all these things would assuredly shoot through the roof and may even cause a shortage.
So, it’s easy to see the major impact shutting down the border would cause. The U.S. economy wouldn’t be free of disastrous consequences. Losing our third largest trading partner would indeed reverberate throughout the stock market and beyond. Regardless of your political affiliation, we should all hope that President Trump doesn’t make this mistake.
