Panda diplomacy leads to millions going to China, with very little oversight
American zoos have sent tens of millions of dollars to China under the Endangered Species Act in what some have referred to as “panda diplomacy” over the past few decades. In exchange for the large amounts of money, China ships pandas, in pairs, to American zoos. The National Zoo in Washington and the San Diego Zoo are among them.
The money, by U.S. law, is supposed to be spent on protecting pandas in the wild. However, a New York Times investigation of thousands of pages of documents and interviews with dozens of witnesses indicates China has spent a lot of that money on things such as roads, apartment buildings and museums. In addition, China refused to explain where all the money goes.
The U.S. Fish and Wildlife Service oversees the American payments. It raised concerns with American zoo officials and froze payments on a few occasions. But zoo managers worried if the agency cut off payment to China, the Chinese would want their pandas back.
Such a move would cost American zoos revenue, visitors, media attention and sales of merchandise. As a result, federal regulators allowed the payments to continue.
A former Fish and Wildlife official is quoted by The New York Times as saying the Chinese felt it should not be of any concern to the United States how they were using the money.
The Times investigation found the pandas are often used for breeding more so than conservation efforts. In tracking financial reports, the probe found that $86 million has gone from American zoos to a pair of organizations run by the Chinese government. The investigation discovered that some of the money was used to help transform a panda breeding center in Western China into an attraction.
The Times examined recent contracts and found no mention of checking to see how China is spending the millions of dollars by the National Zoo or the San Diego Zoo. American regulators who have been to China said they did see some evidence of conservation there. However, they also said the pandas habitat is shrinking, and the animals have less territory to roam.
China warns it will take action if US implements new chip control measures
China is putting out a warning that it plans to take action if the United States enforces new chip control measures. This comes after reports said the Biden administration could come out with new export procedures by the end of the week.
Reuters reported the U.S. Chamber of Commerce told its members the plan includes adding as many as 200 Chinese chip companies to a trade blacklist which would prevent most U.S. suppliers from shipping to them.
China’s Commerce Ministry spokesperson He Yadong said China strongly opposes what he claims is the U.S. broadening the concept of national security and the “abuse” of control measures targeting Chinese companies.
The U.S. tightened controls on semiconductors over fears that China could use the technology to strengthen its military.
“These actions severely disrupt international economic and trade order, destabilize global industry security and harm the cooperative efforts between China and the U.S.,” Yadong said.
It’s not clear what actions China would take, but Yadong said the country would do what it needed to protect the rights of Chinese companies.
The reported changes are a reversal after the Biden administration signed a bipartisan bill in 2022 providing incentives for chipmakers to set up manufacturing in the U.S., committing $53 billion to boost U.S. competitiveness with China.
The chips are an important component for several products including electronics, vehicles, medical devices and defense systems.
There are also concerns the revitalization of the semiconductor industry will be impacted when President-elect Donald Trump takes office in January 2025.
“That chip deal is so bad,” Trump said on The Joe Rogan Experience podcast in October. “We put billions of dollars for rich companies to come in and borrow the money and build chip companies here.”
Trump said he plans to put up to 60% tariffs on goods from China and a tax of at least 10% on all other imports.
Meta to build $10B global underwater internet cable: Report
Meta, the parent company of Facebook, is reportedly planning to build a $10 billion underwater fiber-optic cable that will go around the world. The cable would help the company handle high user traffic and keep a high quality of service internationally.
The addition brings Meta in line with Alphabet, the parent company of Google. The company has a network of cables, some of which they own fully.
The technology news site TechCrunch reported that the new cable would be exclusively for Meta’s use. They planned the route for the cable to avoid areas they think face political and military tensions.
The reported route for the cable will take it from the East Coast of the U.S., across the Atlantic, around South Africa, up to India, above the northern part of Australia and across the Pacific to the West Coast.
Undersea cables play a key role in global fiber-optic internet. However, their locations can put them at risk. Cables in the Red Sea suffered damage from strikes by Yemen’s Houthi rebels earlier this year.
Now, authorities in Denmark are looking into cable damage caused in the Baltic Sea. Danish officials said a Chinese ship caused the damage earlier this month.
The officials accused the crew of the ship, which left from a Russian port, of intentionally dragging its anchor to cut underwater cables.
The TechCrunch report said Meta will likely share more details about its global project sometime in 2025. Officials said the project could take years to complete.
China debuts H-6N nuclear bomber in joint patrol with Russia
China and Russia conducted a joint patrol of nuclear-capable bombers over the Sea of Japan on Friday, Nov. 29, their ninth such operation since 2019. The patrol featured China’s H-6N bomber, its first deployment in such an exercise, and Russia’s Tu-95MS strategic bomber, according to Chinese state media.
South Korea’s military reported that 11 Chinese and Russian aircraft entered its air defense identification zone (ADIZ), prompting it to scramble fighter jets. The planes remained in the zone for about four hours but did not breach South Korean airspace. Officials said they lodged formal protests with both Beijing and Moscow over the unannounced flights.
The South Korean military stated that Russian aircraft approached from the northeast over the East Sea, while Chinese planes entered from the south and moved northward. The two groups of bombers met south of Dokdo, a group of islands claimed by both South Korea and Japan, before leaving the ADIZ.
China’s state broadcaster described the patrol as part of an annual plan aimed at strengthening joint training and operational capabilities. Russia has not commented on the exercise.
The joint patrol follows similar missions earlier this year, including a July operation near Alaska that prompted the United States and Canada to dispatch fighter jets. It also comes amid escalating military tensions, including Russia’s recent deployment of a hypersonic missile in Ukraine.
Air defense identification zones, such as South Korea’s ADIZ, require foreign aircraft to identify themselves for security purposes but do not constitute sovereign airspace. These zones often overlap, leading to disputes between nations.
Moscow argued that South Korea’s ADIZ was established unilaterally and does not legally bind other countries. South Korea maintains that all aircraft entering the zone should provide notice and routinely scrambles fighter jets in response to unauthorized entries.
Mexico’s president refutes Trump’s claim she promised to close the border
President-elect Donald Trump said Mexico has agreed to stem the tide of migrants flowing into the United States, but Mexico’s president is now saying that’s not quite accurate. And Amazon workers are using Black Friday to make a statement about their labor situation. These stories and more highlight your Unbiased Updates for Friday, Nov. 29, 2024.
Mexico’s president refutes Trump’s claim she promised to close the border
As President-elect Donald Trump gets ready to return to office, he’s already making moves to follow through on some of his biggest campaign promises. After announcing this week his plans to impose tariffs on goods from China, Canada and Mexico, he turned his attention to another hot-button issue: immigration.
It’s a bit of a case of “he said, she said” after Trump had a call with Mexican President Claudia Sheinbaum on Wednesday, Nov. 27. President-elect Trump posted on his Truth Social platform after the call saying Sheinbaum agreed to stop migration into the U.S. through Mexico, “effectively closing our southern border.”
Sheinbaum appeared to contradict Trump in a post of her own on X, saying in part, “Mexico’s position is not to close borders…”
She did, however, lay out Mexico’s “comprehensive strategy” for addressing the migration issue. In a separate post on X, Sheinbaum said during the call, she told President-elect Trump, “No caravans are arriving at the border because they are being attended to in Mexico.”
En nuestra conversación con el presidente Trump, le expuse la estrategia integral que ha seguido México para atender el fenómeno migratorio, respetando los derechos humanos. Gracias a ello se atiende a las personas migrantes y a las caravanas previo a que lleguen a la frontera.…
The two leaders also talked about how they’re addressing the U.S. fentanyl crisis.
The call was scheduled after Trump unveiled plans to slap 25% tariffs on all imports from Mexico to the U.S. as part of the effort to stem the flow of illegal drugs into the U.S. through Mexico.
Not only would that impact the prices of avocados and agave — both very popular in the U.S. — Mexico’s economy secretary said Wednesday 88% of all North American pickup trucks come from Mexico. Sheinbaum then suggested Mexico could retaliate with tariffs of its own.
“I hope he rethinks it,” Biden said. “I think it’s a counterproductive thing to do. You know, one of the things you’ve heard me say before is that we are – we have an unusual situation in America. We’re surrounded by the Pacific Ocean, the Atlantic Ocean, and two allies: Mexico and Canada. The last thing we need to do is begin to screw up those relationships.”
Economists forecast Trump’s planned tariffs would increase prices for American shoppers, costing the average U.S. household about $2,600 per year, according to an estimate from the Peterson Institute for International Economics.
Israel and Hezbollah both claim ceasefire violations
Barely three days into a 60-day ceasefire between Israel and the Iran-backed militant group Hezbollah in Lebanon, both sides are claiming violations.
Yesterday, Hezbollah had a precision-guided missile manufacturing site—today, they don’t.
Hezbollah’s largest precision-guided missiles manufacturing site, 1.4km wide and 70m underground, was struck and dismantled by IAF fighter jets yesterday.
Lebanese authorities also said two people, who were trying to return to southern Lebanon, were shot and wounded by Israeli forces. Lebanon’s health ministry said they were civilians, but the IDF claimed they were suspected of violating terms of the truce.
The agreement, brokered by the United States and France, includes an initial two-month ceasefire during which Hezbollah militants will withdraw north of the Litani River and Israeli forces are to return to their side of the border.
Thousands of Amazon workers to strike from Black Friday to Cyber Monday
Amazon workers in more than 20 countries, including the U.S., are on strike on some of the busiest pre-Christmas shopping days across the world. It started on Black Friday, Nov. 29, a day for bargain hunters to score some of the biggest discounts from stores across the country as holiday shopping kicks into high gear.
Organizers told the United Nations the so-called “days of resistance” are to hold Amazon accountable for alleged labor abuses, as well as “environmental degradation and threats to democracy.” According to ABC News, the strike could delay holiday deliveries.
The organizers said this is their fifth year of labor action against Amazon during the beginning of the holiday shopping season.
In a statement, Amazon said the group that organized the strikes is being “intentionally misleading” and promoting a “false narrative.” Management said the company offers great pay and benefits.
Canada sues Google over control of online ads
Canada’s antitrust watchdog said it is suing Google over alleged anti-competitive conduct in the company’s online advertising business. They’re calling for Google to sell off two of its ad tech services and pay a penalty.
The Competition Bureau said it’s necessary because an investigation into Google found the company “unlawfully” tied together its ad tech tools to maintain its dominant market position. Google insists the online advertising market is a highly competitive sector and is fighting the allegations.
This comes just a week after the U.S. Department of Justice asked a federal judge to force Google to sell its Chrome web browser, saying it continues to crush the competition through its dominant search engine.
America facing a live Christmas tree shortage again
As millions of Americans get ready to begin their search for the perfect Christmas tree, growers are having historic challenges getting them to sale lots, according to the Wall Street Journal.
The day after Thanksgiving is usually the biggest day for live tree sales, but since Thanksgiving came so late this year, it’s a very short selling season. On top of that, a nationwide shortage is expected thanks to severe weather across the country this year, such as a northeastern drought and North Carolina floods caused by Hurricane Helene. North Carolina is the second-biggest supplier of Christmas trees in the country.
Shoppers bought roughly 21.6 million real Christmas trees in the U.S. last year, according to the National Christmas Tree Association. The Department of Agriculture said the number of trees harvested in the U.S. has declined 30% since 2002, while the American population has grown 16% over the same period.
Alaska native air drops Thanksgiving turkeys to families in remote areas
In the most remote parts of Alaska a Thanksgiving turkey is hard to come by. So, one woman made sure families in roadless parts of the state had their holiday feast.
Pilot Esther Keim calls it “Alaska Turkey Bomb.” She flies in a small plane to off-the-grid homes and air drops frozen turkeys for families to enjoy for Thanksgiving.
Keim said it’s a tribute to a family friend who did the same thing for her family when she was growing up.
She started the tradition in 2022 after somebody that she knew told her they did not have much of a holiday dinner — and no turkey at all. Since then, she has delivered 30 to 40 turkeys every year to families living in remote areas of Alaska.
Chinese ship dragged anchor for over 100 miles cutting comm lines: Report
Officials have released new details in the probe into a Chinese ship detained by Danish authorities earlier this month. The ship is believed to be responsible for severing critical communication lines in the Baltic Sea.
Investigators told The Wall Street Journal on Wednesday, Nov. 27, they suspect the crew of the Chinese-owned bulk carrier vessel filled with Russian fertilizer purposely let the ship’s anchor drag for more than 100 miles to cut the cable lines between European allies.
Now, the investigation is reportedly focusing on whether the ship, which left a Russian port, worked with Moscow intelligence to commit the alleged sabotage.
A senior European investigator told The Wall Street Journal that it’s “extremely unlikely” that the captain of the ship failed to notice his vessel had dropped and dragged its anchor. Investigators noted the ship lost “speed for hours” as a result.
The ship’s owner is reportedly cooperating with the investigation, but the company declined to comment on the ongoing probe.
Investigators revealed they found data that showed the vessel dropped its anchor in Swedish territory and kept dragging the anchor as it cut the first cable lines between Sweden and Lithuania.
Authorities say around 3 a.m. the following day, the ship cut a second communication line between Germany and Finland after more than 100 miles of travel.
Shortly after the incident, investigators note, the ship raised its anchor and continued until the Danish navy intercepted the vessel and detained it.
A review of the ship’s anchor reportedly revealed damage officials say is consistent with dragging.
The crew is captained by a Chinese national and it includes a Russian sailor. However, they’ve yet to be questioned as part of the investigation.
Western intelligence officials acknowledged they don’t think China is behind the incident but suspect Russian intelligence agencies may be behind the sabotage of the communication lines between NATO allies.
Chinese Foreign Ministry spokesperson Mao Ning told The Wall Street Journal, “I would like to reiterate China’s consistent support working with all countries to maintain the security of international submarine cables and other infrastructure in accordance with international law.”
3 Americans imprisoned in China for years are now free after agreement
Three Americans imprisoned in China for years have been released and are coming home to the United States. The White House announced on Wednesday, Nov. 27, the agreement between Washington, D.C., and Beijing in the final weeks of President Joe Biden’s presidency.
The exchange is reportedly part of a prisoner swap with the U.S. releasing unidentified Chinese nationals, although the White House would not confirm those details.
The United States says the freed Americans were wrongfully detained and one had been facing a death sentence on drug charges. The other two U.S. citizens were imprisoned for alleged espionage and one faced a life sentence.
The U.S. said the White House had brought up the release of the three Americans over the past several years, including earlier this month when Biden met with Chinese President Xi Jinping at the Asia-Pacific Cooperation Summit in Peru.
The release of the three Americans comes just months after Beijing released a pastor from California who spent nearly two decades in prison after being convicted of contract fraud.
Trump taps Jamieson Greer for USTR to push ambitious tariff policies
President-elect Donald Trump made a cabinet pick Tuesday, Nov. 26, that will play a crucial role in his second administration. Trump announced trade attorney Jamieson Greer will be his U.S. trade representative, overseeing the policy central to his campaign.
Greer served as an Air Force lawyer and eventually transitioned to trade. He is a protégé of Robert Lighthizer, the USTR during Trump’s first term. The two worked together before Trump was elected in 2016, and Lighthizer brought Greer on to serve as his chief of staff when he assumed the role in the administration.
Greer spent most of the time behind the scenes while Lighthizer was front and center during Trump’s first administration. Lighthizer is noticeably absent as the president-elect fills his cabinet this time around. He’s been passed over for Commerce Secretary, Treasury Secretary and now his previous post is being filled by his chief of staff.
In a statement posted to Truth Social, Trump said Greer played a key role during his first term, “imposing Tariffs on China and others to combat unfair Trade practices, and replacing the failed NAFTA deal with USMCA.”
Trump added Greer will focus “on reining in the Country’s massive Trade Deficit, defending American Manufacturing, Agriculture, and Services, and opening up Export Markets everywhere.”
Greer will have a full plate if his nomination is confirmed. On Monday, Nov. 25, Trump announced in a Truth Social post that on his first day as president, he’ll sign an executive order charging Mexico and Canada a 25% tariff on all products coming into the United States.
Beyond implementing the policy, existing trade deals that Trump negotiated could cause a bit of a headache for Greer according to trade experts.
“It is a violation of the USMCA. The U.S. just basically said, ‘Oops, we are going to impose these tariffs no matter what our treaty says,’” Mary Lovely, a senior fellow at the Peterson Institute for International Economics specializing in U.S. trade flows and U.S.-China trade, said.
The president-elect also announced an additional 10% tariff on China related to the fentanyl crisis, with more action on China expected. Politico reports Greer was instrumental in negotiating Phase One of the U.S.-China trade deal and the USMCA.
Tariffs are arguably the most prominent economic policy touted by Trump as he ran for a second term. He’s floating tariffs as high as 60% or more on China. If prior comments are any indication, Greer will aggressively enforce the president’s agenda.
In congressional testimony, Greer said Trump’s tariffs on China, “generally were not passed on to consumers and economic indicators such as unemployment, inflation and per capita GDP thrived during the height of the ‘trade war.’”
“There is no silver bullet, and in some cases the effort to pursue strategic decoupling from China will cause short-term pain,” Greer wrote. “However, the cost of doing nothing or underestimating the threat posed by China is far greater.”
The president-elect also announcedKevin Hassett would serve as the director of the White House National Economic Council. Hassett was a senior adviser during the first Trump administration. Before Trump, Hassett advised every Republican nominee for president since 2004.
Trump said Hassett “played a crucial role in helping to design and pass the Tax Cuts and Jobs Act of 2017.”
“He will play an important role in helping American families recover from the Inflation that was unleashed by the Biden Administration. Together, we will renew and improve our record Tax Cuts, and ensure that we have Fair Trade with Countries that have taken advantage of the United States in the past,” Trump said about Hassett’s future role.
Cease-fire between Israel and Hezbollah holding so far
The cease-fire between Israel and Hezbollah marks a step toward peace in the Middle East, but what happens now in Gaza where Israel is still at war with Hamas? And rain or shine — but not wind — revelers get ready to celebrate in New York City at the Macy’s Thanksgiving Day Parade. These stories and more highlight your Unbiased Updates for Wednesday, Nov. 27, 2024.
Cease-fire between Israel and Hezbollah holding so far
A cease-fire deal between Israel and the Iran-backed militant group Hezbollah in Lebanon is holding, so far.
President Joe Biden announced the deal — which the United States and France helped broker — on Tuesday, Nov. 26. Israel and Hezbollah have agreed on an initial 60-day cease-fire, which sets the stage for a lasting truce.
Already, long-displaced residents of parts of Lebanon have started returning to their homes, hopeful the tenuous agreement will be extended beyond two months. That’s despite the Israeli military warning people to stay away from previously evacuated areas.
Israel has said if Hezbollah breaks the cease-fire agreement, it will attack.
Following the directive of the political echelon, the ceasefire agreement in Lebanon took effect at 04:00 today, and the IDF has been operating accordingly. IDF troops are stationed at their positions in southern Lebanon.
Over the past hour, the IDF identified a vehicle with…
During the 60-day truce, Hezbollah fighters are to retreat at least 25 miles from the border with Israel and Israeli forces will withdraw from Lebanese territory.
The agreement does not address the ongoing war between Israel and Hamas, another Iran-backed militant group, in Gaza. However, Hamas has said it is ready for a truce.
“So, now Hamas has a choice to make,” President Biden said on Tuesday. “Their only way out is to release the hostages, including American citizens, which they hold. In the process, bring an end to the fighting, which would make possible a surge of humanitarian relief. Over the coming days, the United States will make another push with Turkey, Egypt, Qatar, Israel and others to achieve a ceasefire in Gaza.”
Biden told reporters he’s hopeful he’ll help achieve a cease-fire in Gaza before the end of his term in January. If not, President-elect Donald Trump has vowed to bring peace to the Middle East, though he has not yet said how.
Trump picks nominations for NIH, trade
President-elect Trump has kept busy this holiday week. On Tuesday night, he announced new picks to join his administration.
Among them, Trump nominated Dr. Jay Bhattacharya to serve as the director of the National Institutes of Health. As head of the NIH, the Stanford University professor would work alongside Trump’s pick for health secretary, Robert F. Kennedy Jr.
Bhattacharya, who also has a doctorate in economics, became known for opposing lockdown restrictions during the COVID-19 pandemic.
— Donald J. Trump Posts From His Truth Social (@TrumpDailyPosts) November 27, 2024
Trump also selected Jamieson Greer to lead the Office of the United States Trade Representative. Greer is no stranger to the department, having served as chief of staff to the trade representative during Trump’s first term — which saw tariffs imposed on Chinese goods and the signing of the U.S.-Mexico-Canada agreement.
Greer served as a lawyer in the Air Force and is currently a partner in international trade at the law firm King and Spalding.
Both of these nominations will need Senate confirmation.
Australia’s House passes bill to ban kids under 16 from social media
The bill would make platforms such as Tiktok, Facebook, Snapchat, Reddit, X and Instagram liable for fines of up to $50 million ($33 million USD) for failing to prevent young children from holding accounts.
Australia’s communications minister Michelle Rowland introduced a world-first law into Parliament on Thursday that would ban children younger than 16 from social media, saying online safety was one of parents’ toughest challenges. pic.twitter.com/K0zui1wHLv
The legislation passed 102-13 in Australia’s House of Representatives and now moves on to the Senate. If the bill becomes law, social media companies would have one year to figure out how to implement the age restrictions before they are enforced.
More than 3,000 fake name-brand electric guitars seized in California
U.S. Customs and Border Protection said it seized more than 3,000 fake electric guitars in Southern California. CBP said the knockoffs were destined for the e-commerce market, just in time for holiday gift shopping.
CBP said if the guitars were real, they would be worth about $18 million. Most of the fakes look like Gibson brand guitars, but some were supposedly from other well-known companies such as Fender.
Federal authorities would not release any details about suspects in the investigation or where the counterfeit guitars came from.
Macy’s Thanksgiving Day Parade to go on, rain or shine
A Macy’s spokesperson told the New York Post the parade will proceed regardless of wet weather — good news for the expected 3.5 million people who will be along the parade route and the estimated 30 million watching at home. However, wind could pose a problem.
The spokesperson told the Post, “Based on the city’s guidelines, no giant character balloon will be operated when there are sustained wind conditions exceeding 23 miles per hour and wind gusts greater than 34 miles per hour on the parade route.”
So far, according to weather reports, the winds should not be a problem, and all 32 balloons should be able to fly. New ones this year include Minnie Mouse and Spider-Man, which is marking its return to the parade for the first time in a decade.
Happy Thanksgiving from Straight Arrow News
With Thursday being Thanksgiving, as you get ready to gather around the table with your family, we wanted to take this time for you to get to know ours a little better. In the video above, members of our Straight Arrow News team have special messages about what they’re thankful for this holiday season. Happy Thanksgiving from our family to yours!
Trump’s proposed tariffs could violate his own trade deal with Canada and Mexico
Experts say President-elect Donald Trump’s vow to put 25% tariffs on Mexico and Canada violates the trade agreement he negotiated during his first term. The U.S.-Mexico-Canada Agreement, or USMCA for short, fulfilled Trump’s 2015 campaign promise to terminate and replace NAFTA, America’s longstanding free-trade agreement with its neighbors.
Trump announced in a Truth Social post that on his first day as president, he’ll sign an executive order charging Mexico and Canada a 25% tariff on all products coming into the United States.
“This tariff will remain in effect until such time as Drugs, in particular Fentanyl, and all Illegal Aliens stop this Invasion of our Country!” he posted.
“It is a violation of the USMCA. The U.S. just basically said, ‘Oops, we are going to impose these tariffs no matter what our treaty says,” said Mary Lovely, a senior fellow at the Peterson Institute for International Economics specializing in U.S. trade flows and U.S.-China trade.
Lovely said Trump could try to unilaterally impose these proposed tariffs using the Emergency Powers Act.
“This would be a very unusual and certainly provocative application of that Emergency Powers Act,” she told Straight Arrow News. “Surely, it will go to the courts, but that seems to be the only route that he could do it given U.S. trade law in general and in particular, the promises we made under USMCA.”
Trump has no problem busting up trade agreements. It was a cornerstone of his candidacy that led to his first term, just as tariffs are for his second.
“It’s a disaster,” Trump said of NAFTA on “60 Minutes” in 2015. “We will renegotiate it or we will break it, because every agreement has an end.”
Is this the end of USMCA? Some are speculating that there is more behind Trump’s day-one tariff threat than meets the eye.
This constant threatening has a cost. It’s not a freebie.
Mary Lovely, Peterson Institute for International Economics
Trump supporter and hedge fund manager Bill Ackman cast doubt in an X post that Trump would even implement the threatened tariffs.
“@realdonaldtrump is going to use tariffs as a weapon to achieve economic and political outcomes which are in the best interest of America, fulfilling his America first policy,” Ackman posted.
“Trump sees an opening to push China further out of America’s backyard,” international relations expert Andrew Law wrote in his publication, The Mexico Brief. “This is less a policy declaration than a move to stir up more trouble amongst bickering allies. The goal? To extract even more concessions from Mexico and Canada on China. He’s throwing a cat amongst the pigeons to watch what happens. It’ll probably work.”
“It is a threat, obviously, and threats do get people to do things sometimes,” Lovely said. “The problem is that every time he threatens a trading partner, particularly free-trade-agreement partners, the rest of the world loses trust in the U.S. as a partner.
“Supply chains start to go around the U.S. rather than through the U.S., and that makes it more difficult for the companies in the U.S. that export,” she continued. “It also makes it more difficult for global companies that are trying to arrange supply chains to serve the United States. So this constant threatening has a cost. It’s not a freebie.”
In conjunction with tariffs on America’s neighbors, Trump also announced an additional 10% tariff on China related to the fentanyl crisis.
If the 25% tariffs on Mexico and Canada do go through, the question is, what will be impacted the most?
“Autos has to be number one,” Lovely said. “The U.S. auto industry is fully integrated with the industries in Mexico and Canada, so much that we don’t think about it as three industries; it’s one integrated platform. Some vehicles are said to go back and cross the border more than seven times before they hit car lots.”
On news of the threat, Detroit’s Big Three automakers traded down on Tuesday morning, Nov. 26. Ford started the day trading down 3%, GM went as far as 8% down, and Chrysler-owner Stellantis went down about 5%.
Food could also be set for a huge sticker shock. The guacamole is always extra, but the U.S. Department of Agriculture says Mexico provides about 90% of the avocados eaten in the U.S. More than half of all U.S. fresh fruit imports come from Mexico. On the northern border, oil is the top import from Canada.
The U.S. is the largest importer of goods in the world, with China, Mexico and Canada as its top suppliers, according to the U.S. Trade Representative. The U.S. is also the second-largest goods exporter after China. The top three recipients of U.S. exports are Canada, Mexico and China.
While the USMCA is not set to expire until 2036, there is a six-year review coming up in 2026. And China has more to do with North American trade than the acronym suggests.
“Many of us expect that the role of China in supply chains that serve the U.S. from Canada, but in particular, Mexico, would be on the table, would be an issue,” Lovely said. “Whether it is in this case I think is just speculation, since President-elect Trump said nothing about that in the social media post he made last night.”