President-elect Donald Trump recently announced his plan to impose tariffs on goods imported from Canada, China, and Mexico in an effort to combat the influx of fentanyl into the United States. Trump believes that these tariffs will pressure America’s three largest trading partners into helping curb the smuggling of fentanyl precursors, the chemicals used to manufacture the potent synthetic opioid. However, experts argue that this approach may prove ineffective and largely punitive to American consumers and businesses.
Targeting one source of fentanyl production often pushes smuggling activities to different regions, with precursors now being sourced from countries like India and Myanmar. During his first term, Trump levied substantial tariffs on various goods, which research shows were mostly borne by American consumers and businesses through higher prices, supply chain disruptions, and reduced economic activity. New tariffs could have significant repercussions, given that Mexico, Canada, and China are the top trading partners of the United States.
Trump’s ineffective fentanyl tariff strategy
American consumers spend around $1.5 trillion on goods and services from these three countries, and tariffs could cripple industries that rely on closely integrated supply chains under the U.S.-Mexico-Canada Trade Agreement (USMCA). Retaliatory measures from these countries, which together import about $1 trillion worth of American goods and services, could further exacerbate the issue, putting millions of American jobs at risk.
Even if Trump’s tariffs were successful in making it more difficult for traffickers to obtain fentanyl precursors, drug producers could shift to manufacturing alternative synthetic opioids like nitazenes, which have precursors widely available in various medicinal drugs, making regulation extremely challenging. Jeffrey A. Singer, MD, a general surgeon in Phoenix and a senior fellow at the Cato Institute, and Clark Packard, a research fellow at the Cato Institute’s Herbert A.
Stiefel Center for Trade Policy Studies, believe that Trump’s tariff strategy is likely to backfire, penalizing Americans without effectively addressing the root causes of the fentanyl crisis.
