27.1.17

Trump's Plan to Build the Wall - Mexican President Cancels Meeting - Trump and Trudeau

U.S. Press Secretary Sean Spicer told a group of reporters on Thursday that the Trump administration is considering a 20 percent tax on Mexican imports as a mechanism to pay for the proposed southern border wall. “By doing it [the tax],” said Spicer, “we can do $10 billion a year and easily pay for the wall just through that mechanism alone.” According to Spicer, the White House is currently speaking with Congressional members about incorporating the new import tax into a broader tax reform plan. This announcement came just hours after Mexican President Enrique Peña Nieto cancelled a planned meeting with Donald Trump.
On Thursday, Mexican President Enrique Peña Nieto cancelled a meeting with President Donald Trump scheduled for next week following Trump’s signing of an executive order to build a border wall and a subsequent spat between the two heads of state on Twitter. Though Trump suggested the cancellation first, Nieto was the one to end it: "We have informed the White House that I will not attend the working meeting planned for next Tuesday with @POTUS," he tweeted on Thursday. "Mexico reiterates its willingness to work with the United States to reach agreements that favor both nations." The White House released a similar statement leaving lines of communication open and calling for a new meeting at a later date.

The Cipher Take:
Spicer’s announcement seems a calculated salvo in the rocky relationship to come between Mexico and the U.S. Four weekdays into his presidency, Trump has already signed executive orders designed to support the construction of a border wall and clamp down on immigrants within the United States - both highly unpopular policies in Mexico. Now, the proposed tax will strain U.S.-Mexico relations even more. These policies and rhetoric, taken together, are probably meant to reassure Americans that Trump is following through on his campaign promises, and show Mexico City that his administration means business. Of course, in reality, a tax on Mexican imports is ultimately a tax on American end-consumers, who will need to pay higher prices for imported goods or more expensive U.S. substitutes. However, such troublesome details may inevitably be lost in the fray.
Trump’s executive order to build the border wall is the first step towards fulfilling an early campaign promise. GOP leaders in Congress are moving forward with plans to fund the wall, which is expected to cost between $12 and $15 billion. Trump has not given up on his additional promise that Mexico would pay for the wall and is pushing for a 20 percent tariff on goods imported from Mexico. This is likely to put a dent in U.S.-Mexico relations. In this episode, Twitter played a curious role. The two leaders communicated publicly in part via the social media service, and the volume of public response on both sides could have limited the possibility of cooler heads prevailing. Though this is an inauspicious start to a bilateral relationship with a neighbor, both sides have left the door open for a second try.

From day one, Canadian Prime Minister Justin Trudeau and U.S. President Barack Obama had a clear connection. On issues of diplomatic, strategic, and economic cooperation, the two leaders appeared to share what Obama called a “common vision and talent.” While, on a personal level, the pair formed a famously close “bromance” relationship in which the younger, like-minded, prime minister often sought advice and assistance from his more experienced peer. However, that cozy dynamic is now gone. The election of Donald Trump, and his inauguration on January 20, has presented the Canadian Prime Minister with an unpredictable and ideologically opposed counterpart in Washington. The uncertainty surrounding this new relationship touches nearly every issue of U.S.-Canadian cooperation. However, two key policy issues, defense and energy, stand out from the pack. On energy, Trump’s promise to “make America energy independent” by pulling out the stops on fossil fuel production stands in direct contrast to Trudeau’s clean energy vision. Similarly, Trump’s insistence that members of the North Atlantic Treaty Organization (NATO) need to pay their fair share has Ottawa, which spends less than one percent of its GDP on defense, worried. Will these ideological differences work to undermine perhaps the single most important U.S. alliance?

At least where defense is concerned, the answer to that question is probably no. According to James Fergusson, Director of the Center for Defense and Security Studies at the University of Manitoba, the long-term value of defense cooperation to such geographically and strategically aligned allies is “largely immune to the vagaries of specific governments on either side of the border.” However, this does not mean that damaging rifts will not form over specific policy disagreements. The issue of meeting NATO (North American Treaty Organization) defense spending requirements, for instance, looks likely to spawn an early source of tension in the relationship. Following up on campaign statements railing against insufficient burden-sharing in the alliance, Trump told the Washington Post editorial board on Monday that “we certainly can’t afford to do this anymore… NATO is costing us a fortune.” This kind of rhetoric is not good news for Canada, which spends only 0.99 percent of its annual budget on defense, and under Trudeau, has shaved billions off the previous administration’s military budget. There are also other areas of defense policy where Ottawa and Washington may butt heads. For instance, Canada has long shied away from joining the U.S. ballistic missile defense system (BMD). Now, says former Canadian ambassador and defense policy advisor Ferry de Kerckhove, “it will not take long for Canada to be ‘told’ to join the BMD.”

However, continues de Kerckhove, “Canada’s defense relations with the U.S. are solidly grounded in joint training exercises, personnel exchanges, strategic policy discussions, and operational cooperation.” That relationship is not going anywhere, and the pure defense spending number, taken out of context, masks the qualitative edge of Canada’s personnel commitments to U.S. and international expeditionary operations. From terrorism and drug enforcement cooperation to protecting the continent against aerial threats through the North American Aerospace Defense Command (NORAD), U.S.-Canadian defense ties are built on particularly deep foundations. Energy policy, on the other hand, could present another obstacle to budding relations between Trump and Trudeau. Trudeau won his election in 2015 based in part on the promise to both reorient Canada’s economy towards renewable energy and offer a voice for climate change action on the international stage. In Obama, Trudeau found a committed ally, and over the past two years, the Prime Minister has both increased Canada’s investment in its own renewable energy resources and advocated for multilateral climate change initiatives. The Paris agreement of December 2015, which pledged a 2 degree centigrade reduction in world temperature, marks a high point in these efforts.

However, not only does the new Trump administration show little interest in fulfilling international climate change commitments, it is not even clear that key members of his cabinet believe human fossil fuel production to be responsible for climate change. At the policy level, Trump’s policy platform speaks of “unleashing” American shale oil reserves, declaring “American energy dominance,” and beefing up U.S. pipeline infrastructure. This intense focus on fossil fuel production has already translated into action with executive orders, which have expedited approval for the Dakota Access pipeline and invited TransCanada to resubmit its application to build the Keystone XL pipeline. Such policies appear directly opposed to Trudeau’s renewable energy platform. However, in many ways, they fit neatly into Canadian energy objectives. Despite the Prime Minister’s focus on renewable energy, Canada is a major oil producer and exporter – the largest exporter of oil to the U.S. in fact. The country’s energy industry needs an efficient path (like Keystone) to the major U.S. refineries of the Gulf Coast, and Trudeau’s rhetorical and practical cooperation with Obama’s environment may have been partially designed to build goodwill in order to win Canadian energy exporters favorable treatment.

Thus, says Senior Associate at the Center for Strategic and International Studies (CSIS) Christopher Sands, faced with the Trump administration, “Trudeau may reluctantly complete a pivot away from his former priority-- addressing climate change—to a new one: promoting Canadian energy exports.” At the same time, the Prime Minister can “pivot from climate action to climate persuasion” on the international stage, which, according to Sands, will “yield political benefits for Trudeau at home.” Trump and Trudeau may disagree on issues from free trade to multilateral climate action, and Trump is unlikely to enjoy the close personal relationship that Obama developed with the Canadian Prime Minister. However, linked by geography, history, and economic interest, it will take more than rhetoric alone to drive a wedge between Canada and the United States.

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