Trump triggers rift with Mexico

Associated Press

WASHINGTON

Determined to wall off America’s border with Mexico, President Donald Trump triggered a diplomatic clash and fresh fight over trade Thursday as the White House proposed a 20 percent tax on imports from the key U.S. ally and Mexican President Enrique Pena Nieto abruptly scrapped next week’s trip to Washington.

The swift fallout signaled a remarkable souring of relations between Washington and one of its most important international partners just days into the new administration. The U.S. and Mexico conduct some $1.6 billion a day in cross-border trade, and cooperate on everything from migration to anti-drug enforcement to major environmental issues.

At the heart of the dispute is Trump’s insistence that Mexico will pay for construction of the massive wall he has promised along the southern U.S. border. Trump on Wednesday formally ordered construction of the wall.

The plan was a centerpiece of Trump’s election campaign, though he never specified how Mexico would fund the project or how he would compel payments if Pena Nieto’s government refused.

The two leaders had been scheduled to discuss the matter at the White House next week. But Pena Nieto took to Twitter Thursday to say he had informed the White House he would not be coming.

In a speech in Philadelphia later Thursday, Trump cast the cancellation as a mutual decision. He said that “unless Mexico is going to treat the United States fairly, with respect, such a meeting would be fruitless, and I want to go a different route. We have no choice.”

On the flight back to Washington, Trump’s spokesman told reporters the president was considering the 20 percent import tax to foot the bill, the most specific proposal Trump has ever floated for how to cover a project estimated to cost between $12 billion and $15 billion.

“By doing that, we can do $10 billion a year and easily pay for the wall just through that mechanism alone,” Spicer said. “This is something that we’ve been in close contact with both houses in moving forward and creating a plan.”

Spicer said Trump was looking at taxing imports on all countries the U.S. has trade deficits with, but he added, “Right now we are focused on Mexico.”

But the announcement sparked immediate confusion across Washington, and the White House tried to backtrack. During a hastily arranged briefing in the West Wing, chief of staff Reince Priebus said a 20 percent import tax was one idea in “a buffet of options” to pay for the border wall.

A 20 percent tariff would represent a huge tax increase on imports to the U.S., raising the likelihood of costs being passed on to consumers. Half of all non-agricultural goods enter the U.S. duty free, according to the office of the U.S. Trade Representative. The other half face import tariffs averaging 2 percent.

Mexico is one of America’s biggest trade partners, and the U.S. is the No. 1 buyer from that country, accounting for about 80 percent of Mexican exports. A complete rupture in ties could be damaging to the U.S. economy and disastrous for Mexico’s. And major harm to Mexico’s economy would surely spur more people to risk deportation, jail or even death to somehow cross the border to the U.S. — undercutting Trump’s major goal of stopping illegal immigration.

House GOP lawmakers and aides interpreted Spicer’s comments on a 20 percent border tax as an endorsement of a key plank of their own tax plan, which Speaker Paul Ryan has been working to sell to the president. The House GOP “border adjustability” approach would tax imports and exempt exports as a way of trying to help U.S. exporters and raise revenue.

Earlier this month, Trump called that concept confusing. And during the White House’s clean-up efforts Thursday, Spicer wouldn’t say whether Trump agreed with the border adjustment tax being considered by the House GOP.

The new president has previously raised the prospect of slapping tariffs on imports, but had not suggested it as a way to pay for the border wall.

There’s also disagreement within his new administration over the effectiveness of tariffs in general. Wilbur Ross, Trump’s nominee for commerce secretary, dismissed tariffs for trade negotiations during his confirmation hearing, saying the 1930 Tariff Act “didn’t work very well then and it very likely wouldn’t work now.”

EPA CUTS

The former head of Trump’s transition team at the Environmental Protection Agency said Thursday he expects the new administration to seek significant budget and staff cuts.

Myron Ebell said in an interview with The Associated Press that Trump is likely to seek significant reductions to the agency’s workforce — currently about 15,000 employees nationwide. Ebell, who left the transition team last week, declined to discuss specific numbers of EPA staff that could be targeted for pink slips.

Asked what he would personally like to see, however, Ebell said slashing the agency’s size by about half would be a good start.

“Let’s aim for half and see how it works out, and then maybe we’ll want to go further,” said Ebell, who has returned to his position as director of the Center for Energy and Environment at the Competitive Enterprise Institute.

The conservative think tank in Washington opposes “global-warming alarmism” and receives a portion of its funding from corporations and individuals that profit from the continued burning of fossil fuels. Ebell has long been a vocal critic of federal environmental regulations, which he claims are strangling the nation’s economy and impeding job growth.

Though he kept specific recommendations he made to the White House confidential, Ebell suggested it was reasonable to expect the president to seek a cut of about $1 billion from the EPA’s roughly $8 billion annual budget.

STATE DEPARTMENT RESIGNATIONS

A number of senior career diplomats are leaving the State Department after the Trump administration accepted their resignations from presidentially appointed positions.

The State Department said Thursday that several senior management officials as well as a top arms control diplomat would be leaving. All had submitted their resignations prior to Trump’s Jan. 20 inauguration as is required of officials holding jobs appointed by the president. They were not required to leave the foreign service but chose to retire or resign for personal reasons, the department said.

While none of the officials has linked his or her departure explicitly to Trump, many diplomats have privately expressed concern about serving in his administration given the unorthodox positions he’s taken on many foreign policy issues.

Turnover among senior leadership during presidential transitions is not unusual, although the career diplomats who are leaving the foreign service entirely had served under both Republican and Democratic presidents.

The union that represents American diplomats, the American Foreign Service Association, called for the administration to quickly name successors to the positions. The union urged that they be filled with career diplomats but played down the significance of the moves.

“While this appears to be a large turnover in a short period of time, a change of administration always brings personnel changes, and there is nothing unusual about rotations or retirements in the Foreign Service,” it said.

More resignations are expected to be accepted as Trump’s diplomatic team takes shape, according to the officials who were not authorized to discuss personnel matters publicly and spoke on condition of anonymity. The now vacant jobs will be filled by subordinates on an acting basis until their full-time appointments are named, the officials said.

Among those whose resignations have been accepted are Thomas Countryman, who had been serving as the acting undersecretary of state for arms control and international security. Others include Undersecretary for Management Patrick F. Kennedy; two assistant secretaries, Joyce Barr and Michele Bond; and Gentry Smith, who directs the Office of Foreign Missions. They had been willing to remain at their posts but had no expectation of staying, according to several State Department officials familiar with the resignations.

Other senior career diplomats to have left the State Department since Trump’s election include Victoria Nuland, the former assistant secretary for European and Eurasian Affairs, and Gregory Starr, the assistant secretary for diplomatic security. Starr retired on Inauguration Day as did Lydia Muniz, a noncareer political appointee who had run Overseas Building Operations.

Trump has yet to fill many top diplomatic jobs, including the deputy secretary roles. His nominee to be secretary of state, Rex Tillerson, is expected to be confirmed by the Senate next week.