The news of the day — as it has for months now — began early Thursday morning with a tweet.
“The U.S. has a 60 billion dollar trade deficit with Mexico,” President Trump typed out on Twitter at 7:51 a.m. “It has been a one-sided deal from the beginning of NAFTA with massive numbers … of jobs and companies lost. If Mexico is unwilling to pay for the badly needed wall, then it would be better to cancel the upcoming meeting.”
What unfurled in the following hours was a flurry of political posturing and policy possibilities. Mexican President Enrique Peña Nieto took Trump’s advice and indeed canceled a meeting in Washington scheduled for next week to discuss immigration, the drug-war and trade, a defiant response to the U.S. president’s recent executive order about his much-hyped border wall. Mexico, Nieto said, will not pay for it.
So who will? The White House is still figuring that out, a complication made especially evident Thursday when press secretary Sean Spicer suggested — and then later backtracked on — a possible solution: a 20 percent tax on imports from Mexico.
The Internet, doing what it does, quickly distilled all that down to a concise and panicked takeaway:
“Avocado anxiety over Trump’s border tax,” from the BBC.
“Trump is going to build that damn wall and all people can talk about is avocados,” from Mashable.
And, from Twitter Moments, “Trump’s proposed import tax sparks widespread guacamole panic.”
The memes and all-upper-case rants that followed took jabs at hipster Brooklynites, white girls and the avocado toast they so stereotypically Instagram.
But all joking aside, their fears of a potential price hike — if an import tax is actually imposed — are founded in reality.
Mexico sends 78 percent of its avocado exports to the United States, and over 98 percent of U.S. avocado imports come from just three countries — Mexico, Chile and Peru — with the vast majority originating from Mexico, according to 2013 data from the United States Agency for International Development.
An analysis by The Washington Post’s Phillip Bump determined that Americans would need to buy between 20 and 25 billion avocados to pay off the wall, if the purchase of that fruit was the only way the United States planned to fund it. It’s not, of course, but Bump calculated how Americans could pay off the wall with purchases of other Mexican products.
And there are many.
In a tweet Thursday afternoon, Sen. Lindsey O. Graham (R-S.C.) expressed his opposition to a border tax, emphasizing that “any tariff we can levy they can levy,” then listed a few essential products he thinks Americans wouldn’t want to go without: “Simply put, any policy proposal which drives up costs of Corona, tequila, or margaritas is a big-time bad idea.”
“Mucho Sad,” he added, a play on the Twitter stylings of the president.
There was no exclamation point.
But the extent of Mexican-made products that Americans consume stretches far beyond the products you’d find at a Taco Tuesday celebration.
In 2015, Mexico was the third-largest supplier of imported goods to the United States, according to data from the Office of the United States Trade Representative. Those imports included agricultural products, which totaled $21 billion. Leading that category was fresh vegetables ($4.8 billion), followed by fresh fruit ($4.3 billion); wine and beer ($2.7 billion), snack foods ($1.7 billion) and processed fruits and vegetables ($1.4 billion).
An import tax on these goods could cause a significant bump to the average American’s grocery bill.
But other products that are less associated with Mexican production actually make up far more of America’s top imported goods.
Vehicle imports alone dwarfed agricultural products in 2015, according to the data, totaling $74 billion. Electrical machinery came next, at $63 billion, followed by machinery ($49 billion), mineral fuels ($14 billion) and optical and medical instruments ($12 billion).
What all that means, put simply, is that a 20 percent tariff on all those goods would likely mean that the financier of Trump’s border wall would not be Mexico, but the American people, Edward Alden, a trade expert at the Council on Foreign Relations told CNN Money.
“The notion that a 20 percent tariff is a way of forcing Mexico to pay for the wall, it’s just a falsehood,” Alden said. “It’s a way of forcing American consumers to pay for the wall.”
And, as CNN Money previously reported, the Mexican government has already promised to retaliate against a major border tax. Economy minister Ildefonso Guajardo said on a Mexican news show last week, which CNN Money translated, that the country was ready to “neutralize the impact” of a tariff.
As journalists, economists and avocado doomsday-preppers began analyzing Thursday what a 20 percent border tax could mean for U.S.-Mexico trade relations, Spicer was quick to clarify that the tariff was just one possibility.
“The idea is to show that generating revenue for the wall is not as difficult as some might have suggested,” Spicer told reporters. “One measure alone could do this.”
But in the bizarre time we live in, when tweets can trigger stock market plunges and political movements, the Internet credited the avocados.
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