Politics
Trump slaps major tariffs on Mexico, Canada and China, setting the stage for trade war
Washington — President Trump slapped sweeping tariffs on goods from Mexico, Canada and China on Saturday, sending shock waves through the global supply chain and sparking fears of a disruptive trade war that could dramatically raise costs for U.S. consumers.
Trump signed executive orders placing duties of 25% on imports from Mexico and Canada, except for a 10% rate on Canadian energy products. He imposed a 10% tax on all imports from China.
The White House said the tariffs would go into effect on Tuesday, and could be raised if the targeted countries retaliate with tariffs of their own, as they have threatened. In a post on Truth Social, the president said he was taxing imports from those countries because he blames them for the flow of undocumented immigrants and drugs into the United States.
The three nations are America’s top trading partners, supplying the U.S. with food, medicine, oil, cars, timber and electronics.
Employees work in a Honda car plant in 2014, in Celaya, in the central Mexican state of Guanajuato.
(Eduardo Verdugo / Associated Press)
The tariffs against Canada and Mexico upend a trade pact that dates back three decades and is the linchpin of many tightly integrated industries across North America. Trump himself signed the newest version of the trade accord during his first term, praising the 2020 U.S.-Mexico-Canada-Agreement as “the fairest, most balanced and beneficial trade agreement we have ever signed into law.”
The tariffs threaten to deeply disrupt the economies of Mexico, Canada and China and drive up consumer prices in the U.S.
Experts say some effects will be significant and quickly felt, with American consumers likely finding higher prices for fresh vegetables and fruits and other perishable imports in a matter of days.
“Foreigners don’t pay the tariffs, American businesses and consumers do,” said Jock O’Connell, a trade expert at Beacon Economics, a Los Angeles-based research firm.
Americans are still smarting from a surge of food prices in the wake of the pandemic. High inflation was widely considered an important factor in Trump’s election, and the president has promised to bring down prices for groceries and other goods. But these new tariffs are almost certain to do the opposite, economists say.
The U.S. imports more than $900 billion of products from Canada and Mexico, and a 25% tariff is huge given that goods have crossed North American borders duty-free for many years.
“Is the Trump administration comfortable with hiking the price of avocados and guacamole ahead of the Super Bowl?” said Joseph Brusuelas, chief economist at the accounting firm RSM US, adding that he was not joking.
For many other products, prices may start to increase only as inventories are depleted. Car prices will almost surely rise. U.S. auto manufacturing is so interlinked with Mexico and Canada, with parts going back and forth across borders many times, that analysts say they’re not really American cars but North American cars.
Michigan Gov. Gretchen Whitmer condemned the tariffs and the effect they would have on the auto industry in her state, which Trump flipped in 2024: “A 25 percent tariff will hurt American auto workers and consumers, raise prices on cars, groceries, and energy for working families and put countless jobs at risk. Trump’s middle-class tax hike will cripple our economy and hit working-class, blue-collar families especially hard.”
Gas prices may also rise, especially in the Great Lakes and Rocky Mountain West, which depend on Canadian oil. Trump has repeatedly talked about bringing down the cost of gas, but the U.S. still imports billions of dollars of crude — and ramping up domestic production isn’t so easy or quick.
Steam rises at Suncor’s oil sands facility near Fort McMurray, Canada, in September 2023.
(Victor R. Caivano / Associated Press)
The 10% tariffs on China will add to 10% to 25% duties that Trump imposed on many Chinese imports during his first term, and which former President Biden kept in place. That will hit American household pocketbooks broadly because China is such a big supplier of consumer items.
Under the U.S.-Mexico-Canada trade agreement, any country has the right to pull out at any time. And a U.S. president can impose new tariffs without approval from Congress by invoking the International Emergency Economic Powers Act, which authorizes executive action to counter threats to national security, foreign policy or the economy.
Trump had been warning for months that he planned to impose tariffs on imports in a bid to lure manufacturing back to the United States. Campaigning before the November election, he vowed at one point to establish an across-the-board tax of 10% or 20% on all goods entering the U.S. At another, he threatened a 200% tariff on vehicles from Mexico.
“Come make your product in America,” he told companies in a speech at the World Economic Forum earlier this year. If not, he said, “then very simply you will have to pay a tariff.”
But Trump sees tariffs also as a negotiating tactic to extract compromises from other nations on matters that have little to do with trade.
His executive order imposing tariffs against Canada blames the country for “failing to devote sufficient attention and resources or meaningfully coordinate with United States law enforcement partners to effectively stem the tide of illicit drugs.”
He has said that Mexico must suffer tariffs because it hasn’t done more to stop migrants from reaching the U.S. border.
But experts questioned Canada and Mexico’s ability to further curb drug and people smuggling. A 2022 report commissioned by the U.S. Congress found that “Canada is not known to be a major source of fentanyl, other synthetic opioids or precursor chemicals to the United States, a conclusion primarily drawn from seizure data.”
Others said the tariffs have the potential to spur more migration.
Economies in Mexico and Canada rely much more heavily on the U.S. than the other way around, and the threat of tariffs has made the peso and Canadian dollar very volatile in recent weeks.
The value of Mexico’s exports and imports amounts to almost 90% of the country’s gross domestic product, according to World Bank data. Economists warn that even a small increase in tariffs on goods destined to the U.S. poses serious risks for the economy.
“Under the worst-case scenario, the Mexican economy will fall into recession, the currency will depreciate, and inflation will rise,” reads a report released by the economic research firm Moody’s Analytics.
Analysts say that if tariffs drag down the Mexican economy, more Mexican workers without proper documentation will seek to enter the U.S. “If Mexico goes into a recession, you’ll see a surge in immigration,” said economist Brusuelas.
Migrants make their way to a Border Patrol van after crossing illegally and waiting to apply for asylum between two border walls separating Mexico and the United States on Jan. 21 in San Diego.
(Gregory Bull / Associated Press)
Evan Ellis, a research professor of Latin American studies at the U.S. Army War College’s Strategic Studies Institute, described tariffs as a “catastrophic risk.”
“If you essentially deep-six the Mexican economy … there are people who are going to once again flow across the U.S. border,” he said.
The country’s economy is already on shaky ground. Mexico faces its largest budget deficit since the 1980s. Data show 36% of the population lives in poverty with 7% living in extreme poverty.
A severe recession in Mexico in the 1990s contributed to some 5 million Mexicans immigrating to the U.S.
Mexican President Claudia Sheinbaum has insisted that Mexico has a plan to counter tariffs.
“We are prepared for any scenario,” she told journalists on Friday, although she said that Mexico had been “doing everything in our power” to prevent tariffs. “What do we want? That dialogue with respect prevails.”
Canadian officials have also promised an aggressive response.
“Being smart means retaliating where it hurts,” said Chrystia Freeland, the former finance minister who represented Canada in USMCA negotiations. “Our counterpunch must be dollar-for-dollar — and it must be precisely and painfully targeted: Florida orange growers, Wisconsin dairy farmers, Michigan dishwasher manufacturers, and much more.”
If China, Canada and Mexico retaliate by slapping tariffs on American products entering their markets, that will very likely slow the volume of trade. The ripple effects will be felt across the entire supply chain, hurting business and employment at ports, warehouses and other logistics and transportation operations.
Higher inflation from tariffs may hit Los Angeles especially hard coming soon after the fires, which appear to be pushing up prices for rents and other services and products.
“The timing couldn’t be worse. It will make for a double whammy for Southern California,” said Sung Won Sohn, professor of finance and economics at Loyola Marymount University.
During his first term, Trump in 2018 imposed tariffs on steel from Mexico and other countries, prompting counter-tariffs on American farm goods and straining U.S.-Mexico relations.
At the time, he also threatened broader tariffs on all Mexican goods, but he eventually backed off after American business leaders complained that it would hurt them and his administration extracted a promise from Mexican authorities to do more to stop migrants from reaching the U.S. border.
Marcelo Ebrard, Mexico’s economy secretary, suggested last year that the only goal of tariffs is to achieve political gains, given the makeup of the highly integrated global economy.
“The United States economy is not a manufacturing economy,” said Ebrard. “And I’m sorry, but it will not be that way again.”
Linthicum reported from Albuquerque, N.M., and Lee reported from Washington.
Politics
Trump takes unusual step, lets bipartisan housing bill become law unsigned amid SAVE pressure campaign
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A bipartisan housing bill became law Saturday at midnight after President Donald Trump declined to sign it, capping a weeks-long saga over whether the president would veto the measure amid frustrations with Congress over his stalled agenda.
Trump refused to sign the 21st Century ROAD to Housing Act — legislation aimed at expanding the nation’s housing stock and lowering costs — in an attempt to pressure Congress to pass the SAVE America Act, despite the housing bill clearing both chambers with overwhelming majorities.
“I will not sign the Housing Bill, which has been fully approved by Congress and sent to the White House, in PROTEST over the fact that the United States Senate is not capable of passing THE SAVE AMERICA ACT, which is polling at 97% with the Republican Party, and very high with the non-politician Dumocrats,” he declared on Truth Social Friday morning.
The Trump-backed election measure, which would require proof of citizenship to vote in federal elections and impose voter ID requirements, has struggled to overcome the Senate’s 60-vote threshold.
Meanwhile, the House has not passed a version of the bill that includes the president’s proposed crackdown on mail-in voting and banning men from women’s sports.
President Donald Trump speaks in the Oval Office of the White House, Wednesday, June 3, 2026, in Washington. (Alex Brandon/AP)
HOUSE CONSERVATIVES DERAIL GOP AGENDA IN SAVE AMERICA ACT SHOWDOWN
Under the U.S. Constitution, Trump had 10 days, not including Sundays, to sign or veto the housing measure after the House formally transmitted the legislation to the White House in late June. The president ultimately chose neither option, allowing the measure to become law without his signature.
Though Trump declined to veto the legislation, he sharply criticized elements of the bill and argued it should not have been a legislative priority in recent weeks.
“It’s so unimportant … compared to the SAVE America Act,” Trump told reporters in the Oval Office in late June. “I think the SAVE America Act is exactly what it says. It’s saving America from crooked elections.”
Trump went on to call the housing bill “a yawn,” adding, “compared to the SAVE America Act, just about everything is a big yawn.”
It would have taken a two-thirds majority in both chambers to override a veto — a margin the House and Senate exceeded when they passed the legislation. However, it remains unclear whether so many Republicans would have defied the president had he vetoed the bill.
Trump also appeared to criticize the bill over a provision restricting Wall Street investors from purchasing single-family homes — a policy he first proposed during his January State of the Union address and later urged Congress to pass. Trump previously argued the investor ban would give individual homebuyers a leg up against private equity firms in the housing market.
“I don’t want to hurt people that own houses, too,” Trump later told reporters, appearing to reference the provision. “These people, for the first time in their lives, they have valuable houses. They’ve become rich. I don’t want to hurt them either. What you want to do is what’s good for everyone, get the interest rates down.”
The law also aims to boost housing supply by streamlining federal environmental reviews, loosening rules around the construction of factory-built homes, and incentivizing local governments to modify their zoning laws to allow more housing, among roughly 60 provisions.
Trump’s souring on the legislation created headaches for Republicans, who touted the bill as an affordability win as voters grapple with high housing costs.
“It’s irresponsible to postpone signing the Housing bill due to the SAVE Act,” Sen. Bill Cassidy, R-La., a retiring lawmaker who lost re-election to a Trump-backed challenger, wrote on social media. “We need to start delivering relief to people for the high cost of housing ASAP!!”
Construction workers stand on the roof of homes under construction at a new housing development on June 24, 2026, in Valencia, Calif. (Justin Sullivan/Getty Images)
WARREN TELLS TRUMP TO ‘SIGN THE DAMN BILL’ AS BIPARTISAN HOUSING PACKAGE REMAINS STALLED IN WASHINGTON
Trump abruptly canceled a signing ceremony for the legislation at the U.S. Capitol in June with GOP leaders. The stage had already been set, with at least one senior Republican arriving unaware the president had called off the event shortly before it was scheduled to begin.
The president then declared he would not sign the legislation until Congress passed the SAVE America Act, despite Senate GOP leaders insisting the votes do not exist to advance the measure.
Trump has also expressed frustration with the Republican-controlled Senate for declining to weaken the legislative filibuster, which requires 60 votes to advance most legislation in the upper chamber.
“GET SMART REPUBLICANS, IF YOU DON’T, YOU WON’T BE IN OFFICE FOR LONG!” Trump wrote in a Truth Social post on Sunday.
Before Trump came out against the bill, White House Press Secretary Karoline Leavitt called it “one of the most significant pieces of housing affordability legislation in American history” and said it included an array of policies “long championed” by Trump.
House Speaker Mike Johnson, a Republican from Louisiana, speaks during a news conference at the U.S. Capitol in Washington, D.C., on Oct. 15, 2025. (Eric Lee/Bloomberg via Getty Images)
Meanwhile, Trump political operative James Blair touted the legislation for including the president’s Wall Street investor ban, which he referred to as a “signature commitment.”
House Speaker Mike Johnson, R-La., has argued that Republicans will still promote the landmark housing bill ahead of November.
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“We’ll still celebrate it, but he’s trying to make a point, and I think he’s making it very effectively,” the speaker recently told reporters, referring to Trump. “And the fact that you all ask me every three steps down the hallway illustrates that he has achieved the desired objective, and that is to make SAVE America the number one thing, because if we don’t get that right, everybody’s concerned about what happens next.”
The Trump administration has signed off on a company’s plan to convert an oil and gas pipeline to pump groundwater from the Mojave Desert to thirsty California cities for the first time, a lucrative venture that critics say threatens natural springs and wildlife.
The federal Bureau of Land Management released documents Thursday saying that Cadiz Inc.’s plan to repurpose 162 miles of the pipeline to transport water “will not significantly affect” the environment.
“We’re excited to achieve this pivotal milestone. After many years of planning and environmental review, the project has now reached the construction stage,” said Susan Kennedy, chair and chief executive of Cadiz.
Environmental advocates and leaders of Native tribes, who have been fighting the project, criticized the decision.
“This groundwater mining proposal would drain the desert and rob the Mojave of its rare springs and wildlife habitat,” said Chance Wilcox, California desert associate director of the National Parks Conservation Assn. “It’s indefensible that the Trump administration would once again try to revive the pointless Cadiz project, by defying decades of scientific warnings and refusing to conduct an environmental review of the groundwater mining.”
The application for the federal authorization was filed by the Fenner Gap Mutual Water Co. The documents say the company plans to build seven pump stations, three of them located on federal land managed by the agency.
The 30-inch steel pipeline runs underground from Cadiz’s desert property, near the town of Amboy, northward to the town of Mojave.
The BLM said in its authorization that repurposing the pipeline for water “would comply with all applicable statutes and regulations.” The agency said it has “reasonably determined that the impacts of groundwater withdrawal associated with Cadiz’s groundwater extraction project are outside the scope of analysis.”
Cadiz’s attempts to export water from its property 200 miles east of Los Angeles have drawn controversy for decades.
In 2019, Gov. Gavin Newsom signed legislation that requires the project to undergo scientific study and gain approval from the State Lands Commission before it can take water from the Mojave and sell it to California cities.
Activists opposing the company’s plans include civil rights leader Dolores Huerta.
“Cadiz spells destruction for water, sacred lands, and the desert economy,” Huerta said in a statement. “It is exactly this type of greed and injustice that I have dedicated my life to oppose.”
Leaders of nearby tribes have also objected to Cadiz’s plans to pump from the desert aquifer near the Mojave Trails National Monument and Mojave National Preserve.
“It is the living heart of the desert,” said Daniel Leivas, chairman of the Chemehuevi Indian Tribe. “To drain it would be to drain the life out of the entire desert. No profit is worth such desecration.”
Chairman Timothy Williams of the Fort Mojave Indian Tribe said the company’s plan “to pump and sell 25 times more groundwater each year than the aquifer can replenish would desecrate our traditional territories.”
“Pumping more groundwater than is sustainably replenished is not only negligent, but dangerous to the American Desert Southwest,” he said in the joint statement with other opponents of the project.
For years, while pursuing its plan to sell water far away, the company has been using wells on its property to irrigate nearly 2,000 acres of farmland growing lemons, grapes and other crops. It has drilled more wells in anticipation of being able to export water once the government approved its pipeline.
The company intends to pipe water to communities in San Bernardino County and says it’s “expected to provide one of the lowest-cost sources of new water in the drought-plagued Southwest.” It says the federal permit “marks a key milestone as we finalize project financing with prospective investors.”
Cadiz bought the 220-mile pipeline from El Paso Natural Gas in 2020. Once construction is completed, the company says the pipeline will be able to transport up to 25,000 acre-feet of water per year — about 5% of what Los Angeles uses each year.
The Los Angeles-based corporation is also seeking to build a new pipeline along a railroad right-of-way to transport water to the south.
Environmental groups have repeatedly filed lawsuits challenging the project.
Ileene Anderson, a senior scientist at the Center for Biological Diversity, called the Trump administration’s decision “a green light for environmental destruction.”
She said six of the proposed pumping stations slated to be built are in the habitat of desert tortoises, a species in decline.
“We’ve successfully fended off this project before and we’ll continue to fight to stop this zombie from coming back,” Anderson said.
In 2021, the Biden administration reversed a Trump administration decision that had cleared the way for Cadiz to pipe water across public land. In 2022, a federal judge scrapped the pipeline permit that the Trump administration had issued.
But during President Trump’s second term, the company has again made headway on its plans. In February, Cadiz announced that the federal Environmental Protection Agency had invited it to submit an application for a $194-million low-interest loan for the northern pipeline project.
The company said in May that it reached an agreement with the federal Bureau of Reclamation to provide funding for a review of its potential role in “augmenting water supplies” along the shrinking Colorado River.
The company has also been lobbying the Trump administration. The group Public Citizen said in a recent report that Cadiz, through its nonprofit Fenner Gap Mutual Water Co., enlisted former Interior Secretary David Bernhardt’s new lobbying firm, the Bernhardt Group, and has spent at least $330,000 on lobbying in 2025 and 2026.
Records show lobbyist Luke Johnson has repeatedly accompanied Kennedy at meetings with Interior Department officials.
“The extensive influence of David Bernhardt’s boutique lobbying firm on the agency he formerly led highlights how insider firms staffed with former Trump officials have grown in recent years,” said Alan Zibel, a research director with Public Citizen. He said Bernhardt and his lobbyists “have learned how to master influence-peddling in the anything-goes era of Trump 2.0.”
Earlier this month, an Arizona water agency announced it signed an initial “memorandum of understanding” agreement to buy up to 10,000 acre-feet of water per year from Cadiz’s Mojave Groundwater Bank. The Central Arizona Irrigation and Drainage District provides water to farmlands in Pinal County, where growers are dealing with water cutbacks.
The company said that for this to happen, it would need to build pipelines and reach deals to exchange water across state lines.
Members of California’s congressional delegation have raised concerns. In a recent letter to Interior Secretary Doug Burgum, California Sens. Adam Schiff and Alex Padilla called for a thorough environmental review, saying that federal agencies and peer-reviewed scientific analyses have “warned of the significant and irreversible impacts that Cadiz’s project could have on federal lands and surrounding communities.”
Rep. Raul Ruiz (D-Indio) said in a letter to Burgum that he is concerned about the company’s long-standing effort to extract and export groundwater.
“The area I represent cannot afford to absorb the long-term costs of a commercially driven groundwater export scheme,” Ruiz said.
President Trump has promoted a chain of newly rebranded gas stations across the Philadelphia area with lower gas prices. The New York Times has not been able to get detailed information about who is behind the stations. The Trump administration says it did not fund or subsidize the company.
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