"The notion that a 20% tariff is a way of forcing Mexico to pay for the wall, it's just a falsehood. It's a way of forcing American consumers to pay for the wall," says Edward
Alden a trade expert at the Council on Foreign Relations
First, about 6 million U.S. jobs depend on trade with Mexico, according to the U.S.
Americans will very likely face higher prices for many things -- from cars and computers to avocados and Corona. A litany of products imported from Mexico would be more expensive.
There are other less obvious ways a blunt tariff could come back to bite Americans. Higher prices on some products mean that Americans would have less money to spend on others.It's Economics 101, a course Trump apparently never took in college.
That would end up costing jobs. That's what happened in 2009 after President Obama used tariffs on Chinese tires. It cost more jobs than it saved because prices for tires went up, one study found.
And a Trump tariff would apply to many more products, so the ripple effects would be a lot broader.
That brings us to who pays for the wall. When the U.S. government applies a tariff on Mexican goods shipped into the U.S., Mexican companies don't pay the tariff -- American companies pay it. Companies usually pass the increased cost of goods down to consumers, hence the higher price tag.
So yes, a 20% tariff would pay for the wall. But Mexico would not be paying for it. American consumers would ultimately pay the price. Literally.