What if?

 

What if? 

by Germanico Vaca

Back in 2018, Trump imposed tariffs on China, and the retaliation from China was brutal, they stopped all imports of American farming products and cut off a deal with Vladimir Putin to do farming in Russia, effectively destroying the market for American farmers and is a hit the U.S. economy was never able to recover, and especially agricultural producers have been affected hard. China never came back to buy American products and gets all those products from other countries. Trump is to blame for that. A report from the USDA shows that between mid-2018 and the end of 2019, more than $27 billion, thereof $25.7 billion tied to China, had to be compensated with massive government subsidies to farmers and unfortunately those payments were not enough to save a lot of farmers who lost their farms to foreclosure.

 Back then tariff rates never exceeded 30 percent of goods value in that period and were as low as 7.5 percent for some products, the true result of Donald's adventures with tariffs had a devastating effect. So, the imposition of 25% tariffs on Mexico and Canada will have severe repercussions, and a higher and uniform tariff rate of 60 percent, as Trump has threatened, would be sure to send another shock wave through the U.S. business and farming communities.

 But now the question is what would happen if Canada, Mexico, and other countries decide to retaliate the same way China did. It may not be that far-fetched to think Canada can sell a lot of gas and oil to Europe. Tragically once the market is lost it may become permanent.

 One of the worst realities that the world is facing is the fact that Trump cannot be trusted and by that, The United States cannot be trusted. After all, Trump negotiated and then violated the trade agreement he had with Mexico and Canada and Trump did not care. It is a blatant violation and there may be huge fines at the international courts. It may be easily a trillion dollars per country. Countries must abide by the agreements and no country can sign agreements with the USA if they can see the USA does not respect those agreements it signs, so what happens if Canada cuts all the electricity it provides to the northern states? what happens if Canada sells all its gas and oil to Europe and other countries? What happens if American companies are not given any mining rights or multinational contracts? what if Europe and Latin countries demand the USA close down its military bases? What if retaliatory measures shut down Tesla factories in Mexico and Tesla is prohibited from selling cars in Canada and Mexico?

These are realistic and extreme scenarios of trade retaliation that could have severe consequences for the U.S. economy, especially when global trust in American agreements is further eroded. Let's break it down:

Immediate Economic Impacts:

1. Farming Crisis Worsens:
• If countries like Mexico, Canada, and even Latin America retaliate by refusing U.S. agricultural imports, American farmers—already weakened by the 2018-2019 trade war with China—could face total collapse.
• A massive wave of bankruptcies and farm foreclosures would drive up rural unemployment and devastate supply chains.
• U.S. food prices might rise due to supply shortages, while competitors like Brazil, Argentina, and Russia fill the void in global markets.
2. Energy War with Canada & Mexico:
• Canada is a major supplier of crude oil, natural gas, and electricity to the U.S. If they redirect their energy exports to Europe and Asia, the U.S. would face:
• Higher energy prices, fueling inflation.
• Blackouts in northern states reliant on Canadian electricity.
• A need to increase domestic drilling, which would take years to offset losses.
• Mexico’s natural gas imports from the U.S. would be disrupted, but they could turn to Venezuela or other suppliers, hurting U.S. exports.
3. Loss of Key Trade Agreements & Markets:
• Mexico and Canada, as part of the USMCA trade agreement, could legally retaliate by blocking U.S. imports, shutting down U.S. auto supply chains, and raising tariffs on American goods.
• Tesla and other U.S. automakers, which rely on Mexican factories, could face plant shutdowns, supply chain chaos, and billions in losses.
• If Latin America starts favoring Chinese and European investments over U.S. firms, U.S. businesses would lose lucrative resource extraction rights (mining, lithium, oil).
4. International Legal & Diplomatic Fallout:
• If Trump violates trade agreements as he did with China, Mexico, and Canada, the WTO and international courts could impose trillions in fines.
• Countries may begin removing the U.S. from trade agreements, further isolating the American economy.
• Europe, seeing the chaos, could push for the removal of U.S. military bases, citing instability and lack of trust.

Long-Term Consequences:

1. Rise of an Alternative Global Trade System (BRICS Expansion):
• China, Russia, Latin America, and possibly Canada and Europe could strengthen ties with BRICS as a more reliable economic partner.
• The U.S. dollar’s dominance could weaken if trade moves toward alternative currencies like China’s yuan or a resource-backed Latin American currency.
• The U.S. would lose influence over global trade, reducing its geopolitical power.
2. Strategic Weakness & National Security Threats:
• A collapse in trade and economic ties with allies could weaken U.S. influence, leaving space for China and Russia to take over diplomatic and economic leadership.
• If NATO allies also see the U.S. as unreliable, they may start pushing for reducing U.S. military presence in Europe.
• Latin America could expel U.S. military bases and allow Chinese or Russian military partnerships instead.

Worst-Case Scenario:

If Trump triggers a full-scale trade war, the U.S. could face:

• A massive recession as businesses collapses due to lost markets.
• Hyperinflation from rising energy and food costs.
• Job losses in the millions, especially in farming, energy, and manufacturing.
• A loss of global leadership, allowing China and Russia to dictate international trade.

In the end, the world might not just retaliate economically—they may decide to stop dealing with the U.S. altogether. That would be an existential threat to American economic and political power.

The United States Congress should appoint a committee to study and present solution for the lack of planning, analysis and here is the most appalling fact. In the age of AI and the most powerful analytics tools in the history of humanity where any intelligent person could run a program and several modeling scenarios to see the possible output to make the right decisions. We have an utterly ignorant man pulling decisions out of his ass?

This scenario is not far-fetched—it’s a warning that global trust in U.S. trade policy is already fragile. If Trump repeats his past mistakes on an even larger scale, the damage might be permanent and irreversible.