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    Trump’s Trade Move Could Increase Costs for Many Online Goods

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    President Trump’s decision to impose hefty tariffs on Canada, Mexico and China included a little-noticed but significant change to how online purchases will be taxed when they enter the United States.One provision of Mr. Trump’s executive order will increase costs for more than 80 percent of U.S. e-commerce imports. The decision could shift the landscape for online sales from Chinese vendors like Shein and Temu that have swiftly expanded their market share by sending cheap goods into the United States.The president’s order erased a workaround that many companies have taken advantage of in recent years, particularly since Mr. Trump imposed tariffs on Chinese products in his first term. The provision, known as the de minimis exception, allowed certain products that were sent directly to consumers from online platforms to come into the United States without facing tariffs, a huge tax advantage.This obscure provision of trade law underpins major business models. Shein, Temu and many sellers on Amazon have used the de minimis exemption to bypass tariffs. The exemption allows packages to be shipped from other countries without paying tariffs, as long as the shipments do not exceed $800 per recipient per day.But critics say the de minimis measure has also helped fuel an American drug crisis. Importers who use de minimis do not have to provide as much information to U.S. Customs and Border Protection as they do with other packages, for ease of processing. That means drugs and the precursors used to make them could be more easily shipped into the United States without the government catching them.De minimis stems from a century-old trade law that was originally intended for shipments that would be too trivial to merit the attention of customs. But the use of this provision has exploded in popularity.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Trump Tariffs Threaten to Upend Global Economic Order

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    The invoking of national security to unravel trade agreements could scramble the international trading system in China’s favor.President Trump’s move this weekend to slap sweeping tariffs on Canada, Mexico and China is threatening to fracture the global trading system and a world economic order that once revolved around a U.S. economy that prized open investment and free markets.The speed and scope of the import duties that Mr. Trump unveiled in executive orders on Saturday prompted widespread criticism from many lawmakers, economists and business groups, who assailed the actions as economic malpractice. They warned that the tariffs, which were levied in response to Mr. Trump’s concerns about fentanyl smuggling and illegal immigration, could inflame inflation, cripple American industries and make China an even more powerful global trade hub.Mr. Trump on Sunday defended the tariffs while acknowledging that there could be some negative consequences.“WILL THERE BE SOME PAIN? YES, MAYBE (AND MAYBE NOT!),” he wrote on social media.The executive orders mean that on Tuesday at 12:01 a.m., all goods imported from Canada and Mexico will be subject to a 25 percent tariff, except Canadian energy products, which will face a 10 percent tariff. All Chinese goods will also face a 10 percent tariff.Canada and Mexico have vowed to retaliate swiftly with tariffs of their own, and China said it would pursue unspecified “countermeasures” to safeguard its interests.Speaking on NewsNation on Sunday, Mr. Trump’s senior trade adviser, Peter Navarro, said it was unlikely that the tariffs would be stopped at the last minute.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Who Pays for Tariffs? Here’s What You Need to Know.

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    President Trump is moving forward with extensive tariffs on America’s closest trading partners. Beginning Tuesday, companies bringing products into the United States from Canada and Mexico will pay a 25 percent tariff; importers bringing products in from China will pay an additional 10 percent on top of existing levies.The president has insisted that these tariffs will not increase prices for American consumers and that if anyone pays the cost, it will be foreign countries.But a simple review of how tariffs work suggests that is not the case. Here’s what to know about who pays.Who pays for tariffs up front?A tariff is an extra surcharge put onto a good when it comes into the United States. It is the so-called importer of record — the companies responsible for importing that product — that physically pays tariffs to the federal government.The tariff fee of 10 percent or 25 percent is often charged not on the full sticker price of the good you see at the store, but a lower import price that companies pay to buy a good from abroad, before they mark up the price for sale at a store.Many importers of record are enrolled in the government’s electronic payment program, and have tariff fees automatically deducted from their bank accounts as they bring products into the country. Tariff revenue is collected by U.S. Customs and Border Protection, though Mr. Trump has floated the idea of creating an entirely new agency to deal with money earned from his tariffs.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Trump’s Canada and Mexico Tariffs Could Hurt Carmakers

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    General Motors and a few other companies make as much as 40 percent of their North American cars and trucks in Canada and Mexico, leaving them vulnerable to tariffs.Almost all automakers are going to feel a pinch from the new tariffs imposed by President Trump on Saturday on goods imported from Canada, Mexico and China.Auto manufacturers ship tens of billions of dollars worth of finished automobiles, engines, transmissions and other components each week across the U.S. borders with Canada and Mexico. Billions of dollars more are imported from parts manufacturers in China.The tariffs, which will take effect at 12:01 a.m. on Tuesday, are widely expected to raise the prices that American consumers pay for new automobiles. And the tariffs come at a time when new cars and trucks are already selling for near record prices.General Motors, the largest U.S. automaker, will probably be most affected.G.M. produces many more vehicles in Mexico than any other manufacturer — over 842,000 in 2024, according to MarkLines, an auto-industry data provider. And some of those vehicles are the most important in the company’s lineup.All of the Chevrolet Equinox and Blazer sport-utility vehicles G.M. sells in the United States come from Mexico. The Chevrolet Silverado pickup truck, a top-selling model, and the similar GMC Sierra pickup generate huge profits for the company. Of the more than one million of those trucks built last year, nearly half were produced in Canadian and Mexican plants, data from MarkLines shows.All told, G.M. plants in Canada and Mexico produced nearly 40 percent of all vehicles the company made last year in North America, the region where it gets most of its revenue and almost all of its profits.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Trump’s Tariffs Would Reverse Decades of Integration Between U.S. and Mexico

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    Ties between the United States and Mexico have deepened over 30 years of free trade, creating both benefits and irritants.When Dennis Nixon started working at a regional bank in Laredo, Texas, in 1975, there was just a trickle of trade across the border with Mexico. Now, nearly a billion dollars of commerce and more than 15,000 trucks roll over the line every day just a quarter mile from his office, binding the economies of the United States and Mexico together.Laredo is America’s busiest port, and a conduit for car parts, gasoline, avocados and computers. “You cannot pick it apart anymore,” Mr. Nixon said of the U.S. and Mexican economies. Thirty years of economic integration under a free trade deal has created “interdependencies and relationships that you don’t always understand and measure, until something goes wrong,” he said.Now that something is looming: 25 percent tariffs on Mexican products, which President Trump plans to impose on Saturday as he looks to pressure the Mexican government to do more to curb illegal immigration. Mr. Trump is also expected to hit Canada with 25 percent levies and impose a 10 percent tax on Chinese imports.A longtime proponent of tariffs and a critic of free trade deals, Mr. Trump seems unafraid to upend America’s closest economic relationships. He is focusing on strengthening the border against illegal immigration and the flow of fentanyl, two areas that he spoke about often during his 2024 campaign.But the president has other beefs with Mexico, including the economic competition it poses for U.S. workers. The president and his supporters believe that imports of cars and steel from Mexico are weakening U.S. manufacturers. And they say the United States-Mexico-Canada Agreement, the trade deal Mr. Trump signed in 2020 to replace the North American Free Trade Agreement, needs to be updated — or perhaps, in some minds, scrapped.Many businesses say ties between the countries run deeper than most Americans realize, and policies like tariffs that seek to sever them would be painful. Of all the world’s major economic partners, the United States and Mexico are among the most integrated — linked by business, trade, tourism, familial ties, remittances and culture. It’s a closeness that at times generates discontent and efforts to distance the relationship, but also brings many benefits.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Trump Will Hit Mexico, Canada and China With Tariffs

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    President Trump plans to impose stiff tariffs on Mexico, Canada and China on Saturday, a move aimed at pressuring America’s largest trading partners into accepting more migrants and halting the flow of migrants and drugs into the United States.Mr. Trump will put a 25 percent tariff on goods from Mexico and Canada, along with a 10 percent tariff on Chinese products, Karoline Leavitt, the White House press secretary, said in a news briefing Friday.Speaking to reporters in the Oval Office on Friday, Mr. Trump said the tariffs were punishment for Canada, Mexico and China allowing drugs and migrants to flood into the United States.Mr. Trump’s decision to hit America’s trading partners with tariff could mark the beginning of a disruptive and damaging trade war, one that is far messier than the conflict that defined Mr. Trump’s first term.Back then, Mr. Trump placed tariffs on nearly two-thirds of Chinese imports, resulting in China hitting the U.S. with levies of its own. Mr. Trump also imposed tariffs on steel and aluminum, inciting retaliation from the European Union, Mexico and Canada.While the tariffs against allies were viewed as controversial, they were relatively limited in scope. It remains to be seen exactly what products Mr. Trump’s new tariffs apply to, but the president has implied that they would be expansive and cover imports from Canada and Mexico, close allies of the United States.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    High Inflation and New Tariffs Will Make the Fed’s Job Tougher

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    Fresh tariffs amid high inflation are making the Fed’s job uniquely difficult and feeding uncertainty about what to expect for interest rates this year.High inflation is stoking fresh debate about how the Federal Reserve should respond to President Trump’s sweeping plans to reorder the world economy through tariffs, leading to questions about whether old playbooks still apply.On Saturday, Mr. Trump is poised to impose 25 percent tariffs on imports from Mexico and Canada as well as an additional 10 percent tariff on Chinese goods. That move comes on the heels of threats to impose hefty tariffs on Colombia, which were rescinded after its government complied with Mr. Trump’s demands to accept deported migrants.Howard Lutnick, Mr. Trump’s nominee to oversee the Commerce Department and trade, said at a confirmation hearing on Wednesday that he favored “across-the-board” tariffs that would hit entire countries.The volume of trade policy proposals is making the Fed’s already tricky job even more difficult and sowing uncertainty about what to expect from the central bank as it tries to fully wrestle inflation back to more normal levels.Tariffs are broadly seen by economists and policymakers as likely to stoke higher prices for U.S. businesses and consumers at least initially, and over time weigh on growth. That, as well as Mr. Trump’s plans to also enact mass deportations, steep tax cuts and reduced deregulation, has complicated the path forward for the Fed, which is debating how quickly to resume rate cuts and by what magnitude after pressing pause this week.What comes next is far from clear, leaving central bank officials to parse playbooks both old and new to formulate the right strategy.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Federal Debt Is Now Worrying Even Progressives

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    Long a focus of conservatives, the level of public borrowing is starting to concern left-leaning economists. Proposed remedies still differ radically.The 119th Congress began, as it so often has in recent years, with calls from Republican politicians for wrestling down the national debt, which is near a record level relative to the size of the economy.But this time, the G.O.P. had company: Progressive economists and budget wonks, who have often dismissed finger-wagging about debt levels as a pretext for slashing spending on programs for the poor, are starting to ring alarm bells as well.What’s changed? In large part, long-term interest rates look unlikely to recede as quickly as had been hoped, forcing the federal government to make larger interest payments. And the Trump administration has promised to extend and expand its 2017 tax cuts, which will cost trillions if not matched by spending reductions.“I find it easier to stay calm about this threat when I think the interest rate is low and steady, and I think in the past year or so that steadiness has been dented,” said Jared Bernstein, who led the Council of Economic Advisers in the Biden administration. “If one party refuses to raise revenues, and the Democrats go along more than is fiscally healthy, that’s also a big part of the problem.”To be clear, conservative warnings on the debt have generally been met with little action over the past two decades. A paper by two political scientists and an economist recently concluded that after at least trying to constrain borrowing in the 1980s and 1990s, Republicans have “given up the pretense” of meaningful deficit reduction. Democrats and Republicans alike tend to express more concerns about fiscal responsibility when their party is out of power.Historically, the stock of debt as a share of the economy has risen sharply during wars and recessions. It peaked during World War II. In the 21st century, Congress has not managed to bring the debt back down during times of peace and economic growth.Revenues Are Not Keeping Up With Projected SpendingIf not addressed, debt will probably mount to unprecedented levels.

    Source: Congressional Budget OfficeBy The New York TimesSpending Has Been Creeping UpAs a share of economic output, mandatory outlays — mostly Medicare, Medicaid, and Social Security — are growing fastest. But as debt rises, so do interest costs.

    Source: Office of Management and BudgetBy The New York TimesWe are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More