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Putting "America First", through bullying and causing other nations to suffer?
On January 23, 2017, President Donald Trump signed an executive order to renegotiate NAFTA. He wants Mexico to cut its VAT tax and end the maquiladora program. He will withdraw the United States from the Trans-Pacific Partnership. Trump prefers bilateral trade agreements to multilateral ones. For more, see What Happens If Trump Dumps NAFTA?
What Changes Would Trump Make to NAFTA?
First, Trump would require Mexico to end its value-added tax (VAT) on U.S. companies. Trump claims that the VAT acts as a tax on U.S. exports to Mexico. A VAT tax is like a federal sales tax that's imposed on all companies throughout the supply chain. Mexico charges a 16 percent VAT tax on all business sales, whether it's to other firms or the consumer.
When companies export the finished product to the United States, Mexico rebates the VAT tax. But U.S. companies that export to Mexico must pay the VAT tax. Trump says that encourages U.S. companies to build factories in Mexico to receive the rebate and avoid the tax. (Source: "How Does a Value-Added Tax Work, Anyway?" The Atlantic, March 1, 2010. "Trump's Incredibly Misleading Claim on Mexico," CNN Money, September 28, 2016.)
Second, Trump would ask Mexico to end the Maquiladora program. That program allows U.S. companies to set up low-cost factories across the border in Mexico to assemble finished products. They export the goods back to the United States. As a result, Maquiladoras became responsible for 65 percent of Mexico's exports. That undercut American workers and sent jobs to Mexico. NAFTA expanded the Maquiladora program by ending tariffs. (Source: "The Benefits of Setting Up a Maquiladora in Mexico," The Offshore Group.)
originally posted by: Rookseven
Manufacturing. Boots being made at a Red Wing Shoes factory in the U.S. The Red Wing Shoe brand is primarily handmade in the USA with American materials at the company's plants in Potosi, Missouri and a plant in Red Wing, Minnesota.
Yep. I knew when I posted that somebody would say "it IS the American way."
Knew it knew it knew it.
My shoes cost $150 (after tax) and are made right here in the USA.
originally posted by: seasonal
a reply to: Flyingclaydisk
True, I have to admit I don't know what Reagan envisioned and what we have.
My opinion is that reagan would have been OK with NAFTA the way it sits.
originally posted by: Riffrafter
originally posted by: Blaine91555
80% of exports coming here is a powerful hand to have. Were I betting man, I'd say the deal will be struck out of view of the media quietly in the background and Trump will prevail.
Of course Trump (i.e.the US) will prevail.
We're holding all the aces...and all of the royal flushes too for that matter.
To not prevail would require extraordinary efforts.
The only way to lose this one would be if we were to fold. I can't see Trump doing that in a million years.
Good call Blaine...
It's going to be fun to watch. The "crazy left wing zealots" will lose their collective minds as this is happening.
And why *has* the left gone nuts or brain dead lately?
It's an amazing sight to witness...truly.
originally posted by: lordcomac
Not to mention that without mexican imports, we'd be in a tight spot too. It would take a decade at full speed for us to start up industry in this country to replace what we import now.
Which would be awesome, of course... but it has to be ramped up. You can't just flip a switch, we import almost everything.