Trump has vowed to impose escalating tariffs starting Monday on all Mexican goods if the country does not take more aggressive steps to halt illegal immigration into the United States — though neither the president nor administration officials have been clear about what those steps might be.
The economic consequences of such a move, Texas Republicans warn, are very real in a state that counts Mexico as its top trading partner while also coping with a surge of migrants the Trump administration has struggled to contain.
“I understand why the president is frustrated with congressional Democrats who refuse to do anything to address this crisis,” Sen. Ted Cruz (R-Tex.) said Wednesday. “But there’s no reason that millions of farmers and ranchers and manufacturers and small businesses in Texas should pay the price and should face $30 billion in new taxes. That would be a mistake.”
Cruz in particular has been careful to pick his battles with Trump ever since he was defeated in his bid for the Republican presidential nomination in 2016. So it was a notable development this week when Cruz challenged administration officials in a private party luncheon, telling them to relay to Trump there was not a single “yes” in a room of Senate Republicans in favor of tariffs on Mexican imports.
And even though Republicans have become accustomed to Trump wielding the threat of tariffs as a negotiating tactic, they are baffled that the president is precipitating what could be a self-imposed economic wound — particularly ahead of his reelection campaign.
“The economy has been one of the president’s — and the Republican majority’s — greatest accomplishments,” Sen. John Cornyn (R-Tex.) said. “Tariffs would, I think, certainly diminish that and maybe reverse it.”
Indeed, the impact on Texas would be particularly acute, according to business officials and economic data. Among all states, Texas would be hit the hardest by far by an across-the-board tariff on Mexican goods, according to the U.S. Chamber of Commerce — with a 5 percent levy threatening roughly $5.35 billion worth of imports to the state.
In 2018, Texas imported more than $107 billion worth of goods from Mexico, spanning the gamut from electric and industrial machinery to mineral fuel and oil, according to the Texas Economic Development Corp. That same year, Texas sent nearly $110 billion in its own products to Mexico — more than one-third of its total goods shipped out of the state.
“We in Texas have the most to gain and the most to lose,” said Gerry Schwebel, a top executive at IBC Bank in Texas and Oklahoma. “This is not an issue where you can be a spectator. This is not an issue where you can stay on the sidelines and wait for things to happen.”
Schwebel said he voted for Trump but disagrees with him on the tariffs, which he says have already begun wreaking havoc throughout Texas. His bank deals with all forms of business along the border, such as customs brokers, importers and transportation companies.
Such businesses run on tight margins of 5 or 10 percent and contracts are booked in advance, so even a 5 percent tariff would be costly, he said, and the business does not always have the ability to pass it along to the consumer.
In anticipation of the tariffs, businesses are trying to get orders out before they start, causing capacity problems at ports of entry.
“It’s a tax. It’s not an overly complicated issue,” said Rep. Dan Crenshaw (R-Tex.). “Tariffs are bad for our companies, they’re bad for consumers, and they’re bad for our supply chains.”
Texas remains primarily a Republican state, but Trump’s hold on its voters was more tenuous than previous GOP presidential nominees. Trump won the state by nine points in 2016 over Democratic candidate Hillary Clinton — a notably narrower margin than 2012, when Mitt Romney defeated Barack Obama by nearly 16 percentage points in Texas.
Last year, Cruz narrowly won reelection to his Senate seat over Democrat Beto O’Rourke, while an exodus of college-educated white women from the GOP exacerbated the Republican Party’s problem in the Texas suburbs.
A Quinnipiac poll released Wednesday found that 48 percent of Texans approved of Trump’s job performance, while 49 percent said they disapproved. That poll also found that Trump is effectively tied in Texas with several of the top contenders in the Democratic race for the presidential nomination.
“The Trump tariff policy is going to be bad for Texas, and you represent Texas before you represent Trump,” said Matt Mackowiak, a Republican strategist based in Austin. “Every elected official understands that.”
Still, Republicans in Texas, who are witnessing the swelling migration figures firsthand, have been willing to lend a sympathetic ear to a president grappling with illegal immigration. More than 144,000 people were taken into custody at the southern border in May, according to U.S. Customs and Border Protection figures released Wednesday — the highest one-month total in 13 years.
Trump was particularly incensed by news last week that 1,045 people surrendered to border authorities in El Paso, which marked the single largest group of migrants encountered by Border Patrol.
And several Republicans say the threat of tariffs has helped force Mexico into negotiations over controlling immigration from Central America, whose migrants are fueling the current surge at the U.S.-Mexico border.
“As a Texan who believes in free trade, obviously tariffs are not my first choice of action,” Rep. Chip Roy (R-Tex.) said. “But at some point, the president’s going to have to be able to put pressure on Mexico to work with us.”
And for some, there are limitations in how willing they are to challenge Trump. While some Senate Republicans warned the administration this week that at least 20 GOP senators may defy Trump on Mexico tariffs if it comes to a vote, other Texas lawmakers weren’t willing to go that far.
“I’m not going to vote on a disapproval of the president’s actions. That’s a longtime policy of mine,” Rep. Kenny Marchant (R-Tex.), even as he expressed some reticence over Trump’s tariff threat. “I never voted against the governor when I was in the statehouse.”
Marchant added: “It would have to be very egregious, and I don’t find this to be that egregious.”