IMPORT TAX WILL NOT SOLVE ALL THE PROBLEMS

While living in the southeastern part of Arizona, I tuned pianos for a living. My best customers were in Nogales, Arizona. This border city is the least race conscious border city in America. Nearly everyone in Nogales is bilingual. This is because Nogales is the busiest US portal for Mexican produce being imported into the USA.

There are over 130 produce brokers in Nogales. These businesses all have two main operational processes. They have a front office where bilingual people call farms in Mexico and order vegetables shipped to them, and these people then call north as far way as Tornoto and all over the USA setting up orders to super market chains who order produce.

The other trick of the produce broker is to move the vegetables before they ripen. This means a warehouse with serious temperature control is in constant motion. Docks line one side of the warehouse for incoming, and the other side is for out shipping.

This process is a real trick. The Farmer in Hermocillo, Mexico may be selling a crop that has not been harvested. These Mexican farms are not a bit primitive as we might assume. The farmer at once sends his crews into the field, and the crop is picked, washed, packed, and loaded on trucks. These trucks rush north to the border, and on any morning during the US winter, you can find 700 to 1000 trucks lined up at the truck-only border crossing at Nogales.

The USDA checks only a percentage of the

trucks for quality or for illegal imports. The trucks are thick crawling up and down the hills of Nogales, and at about 10:30 in the morning Nogales, Arizona is in grid lock with trucks. The trucks back up to one side of the warehouse, and the vegetables are stored while the front office calls a trucker in LA or Dallas and tells them their back haul load to Omaha will be ready at 9:00 in the morning.

The broker now has half a truck load of tomatoes for a trucker who is on his way. The broker then sends out his "bird dog" who is an employee who scurries around Nogales to other brokers and tries to locate cucumbers and watermelon for the other half of the trucker's load. As the trucker pulls in to load, a local bob tailed truck pulls in the other side of the warehouse with the cucumbers from Su Casa up the road.

One slip up, and the tomatoes may be too ripe to be saleable in Omaha. I have seen loads of tomatoes that were perfect for eating right now going to the Nogales city dump because they would be garbage if they were shipped. All the warehouse man has to do is store a load of tomatoes in the same storage area as a load of mangoes, and the tomatoes are garbage in hours because the mangoes gas off and ripen the tomatoes. This process is a virtual rodeo of geniuses who keep the process rolling, and they cannot stop and coast for ten minutes.

What does this have to do with Donald Trump?

READ THE STORY HERE

Now, with warehouse workers, bird dogs, management, phone jockeys, and the trucking support, imagine the impact of a 20% tax on all that produce. Thousands of people, from Jose the farm owner in Hermocillo, to American truckers, the system would see a serious drop in business activity. That always means people get laid off. 

And, this means a serious slump in commercial activity for the whole city of Nogales and for a lot of farmers in Mexico. It must be assumed that the Mexican Government will enter this trade war with their own tactics.

This plan of Trump's could end up being a massive case of robbing Peter to pay Paul. What he gains in jobs in the USA could result in jobs lost in the USA down the street or across town.

I bothered you with this rather detailed story of one little corner of commerce in the USA because some of you have no one in your life who has seen it working in real time. I had a large number of produce brokerage owners as piano tuning customers, and most of them would tell me to go around to their warehouse and pick up a case of anything I could use. My wife did all her canning in the winter because, even if I had to pay for tomatoes, they were usually $5 for a thirty pound case.

So, I believe I understand this just as well, or better, than 95% of Trump's advisers. I often ate my lunch at a produce company named Engebretsen, and I heard the trade talk and saw the pains and rewards of these people.

I also know that there are produce farms on the US side of the border which could not compete unless they hired illegal workers. There are places in small towns in Arizona where the Border Patrol looks the other way as illegal Mexicans load into pick up trucks to be taken by the rancher to pick up a crop or sort onions. Trump needs to restore the Braceros (day worker) program from the 1960s which allowed Mexicans to work in the US for a few years and then return home.

Donald Trump is a master of the deal. But, his deals have been in some pretty narrow commercial zones. Will he and his hired hands be able to juggle this import tax idea so that there is a real net gain of jobs? Trump will promise that he will not fail us, but I am certain the verdict is not yet in. 

Trump could also take the USA into a massive worldwide trade war. And, you and I will pay higher prices for anything imported. This, again, means inflation will set in, and that will take us right back to massive unemployment as US companies have to raise wages and lay off workers.

It is historic that the fast fix is a fantasy, and it can be deadly.