Canadian officials said they were notified on Saturday by the U.S. government that the country’s goods will be subject to a 25 percent tariff, and a 10 percent rate for Canadian oil, starting on Tuesday.
Canada’s prime minister, Justin Trudeau, is planning to respond to the tariffs Saturday evening, according to two senior Canadian government officials with direct knowledge of the notification. They spoke on condition of anonymity given the sensitivities of the international negotiations.
Businesses and officials in Canada, Mexico and China were bracing for more details on Saturday on promised tariffs after days of trying to persuade President Trump not to go ahead with them.
White House officials originally said they planned to start the tariffs on Saturday, with 25 percent tariff on goods from Mexico and Canada, along with a 10 percent tariff on Chinese products. It was not immediately clear if tariffs on Mexican and Chinese goods had also been delayed.
Speaking to reporters from the Oval Office on Friday, Mr. Trump said he would impose the levies as punishment for Canada, Mexico and China allowing drugs and migrants to flood into the United States. He insisted that the tariffs would not fuel inflation and suggested that he would move ahead with them regardless of any last-minute concessions from the other nations.
Mr. Trump is spending the weekend at his Mar-a-Lago residence in Florida and had no public events listed on his schedule on Saturday.
The president is expected to sign an executive order putting the tariffs into effect and could do so retroactively. But the lack of clarity surrounding what, exactly, Mr. Trump planned to impose created even more uncertainty for global businesses.
Experts believe the tariffs could have broad impacts on the U.S., Canadian and Mexican economies, driving up prices for consumers and affecting jobs, although there was little doubt that pain would be felt more in Canada and Mexico’s smaller economies.
Over the past few weeks, Mexican and Canadian officials have mounted major efforts to avert the tariffs: Canada has reinforced its border with more staff, drones and Blackhawk helicopters, and Canadian officials have been traversing the United States, trying to lobby key Republicans against the tariffs. Mexico has helped in aspects of Mr. Trump’s immigration crackdown by taking in thousands of deported migrants.
But officials in both nations have also been working on retaliation plans, gearing up for what might quickly become a North American trade war.
U.S. stock markets closed lower on Friday amid anxiety among investors about the fallout from the tariffs.
Lobbying groups for industries such as retail and agriculture, which could be among the hardest hit by retaliation from America’s trading partners, were scrambling for information about the levies but remained in the dark.
Matina Stevis-Gridneff contributed reporting.
The imposition of tariffs on Canadian goods imported into the United States will lead to economic calamity. But already, the tariffs are affecting the country’s political landscape at a fragile, fraught moment.
Weeks earlier, Prime Minister Justin Trudeau announced he would resign as leader of the Liberal Party and the country. The Liberals will choose a new leader and prime minister on March 9, and the country will hold a federal election this year, most likely in the spring.
After almost 10 years under Mr. Trudeau, Canadians will need to make crucial decisions about the country’s political leadership, especially about who they think will be best to fight against President Trump’s tariffs. For many voters, the choice of prime minister may come down to personality, rather than substance, because so far the candidates seem to be in broad agreement on the response to tariffs: that Canada needs to hit back, hard.
The two top contenders to lead the Liberal Party and automatically replace Mr. Trudeau as prime minister are going toe to toe with their plans for retaliation.
The first, Chrystia Freeland, the former finance minister and deputy prime minister, wants Canada to hit back dollar for dollar, slapping its own high tariffs on American goods imported into Canada. Ms. Freeland laid out a detailed plan, including a 100 percent tariff on Tesla vehicles that would target the company owned by Elon Musk, now a key Trump adviser. She led Canada’s trade negotiating team with the United States and Mexico during the first Trump administration.
The second Liberal contender, Mark Carney, the former central banker, is also calling for aggressive retaliation. In an interview with the BBC on Friday, he went as far as to say that Canada should demand repayment of the “subsidies” it gave the United States by selling it 80 percent of its entire oil production at a discount.
The Conservative Party, which has long held a double-digit lead on the Liberals in polling, is looking ahead to this year’s federal election. Its leader, Pierre Poilievre, is pushing for a federal election as soon as the Liberals choose their new leader, betting that he will sweep to victory. Mr. Poilievre is seen as an ideological cousin to Mr. Trump, sharing his populist messaging and combative persona. But in an interview last month he, too, endorsed dollar-for-dollar retaliatory tariffs on American goods.
“We’re both going to lose as Americans and Canadians if we get in a trade war,” he told Canada’s CTV News on Jan. 24. “We can buy elsewhere to maximize the impact on Americans and minimize the impact on Canadians.”
The F.B.I. issued a statement on Saturday indicating that its acting director, Brian Driscoll, was in still in charge, a reflection of the chaos and confusion that has swept through the bureau’s ranks since President Trump’s inauguration. The statement said Driscoll "remains committed to supporting the administration and ensuring a smooth transition to the incoming director.”
President Trump ordered airstrikes on Saturday against the Islamic State in northern Somalia, the first major U.S. military operation overseas since he took office.
Defense Secretary Pete Hegseth said in a statement that the military’s initial assessment was that “multiple operatives” in the remote Golis Mountains in the country’s north were killed in the strikes, and that no civilians were harmed.
The strikes were conducted by Navy and Air Force warplanes, including F/A-18 fighter jets from the aircraft carrier Harry S. Truman operating in the Red Sea, three Defense Department officials said.
“This action further degrades ISIS’s ability to plot and conduct terrorist attacks threatening U.S. citizens, our partners and innocent civilians,” Mr. Hegseth said.
The strikes were more symbolic than substantive, several U.S. military and defense officials said, meant more to burnish Mr. Trump’s image as a commander in chief protecting the country from terrorists in the early days of his administration than to neutralize a serious threat.
On Thursday, the military’s Central Command said a U.S. airstrike in northwest Syria had killed a senior operative in Hurras al-Din, an Al Qaeda affiliate.
The strikes in Somalia on Saturday were a much larger operation, military officials said, and the fact that Mr. Trump had to approve it meant that at least one of the operatives was probably a senior leader of the Islamic State in the African country.
Mr. Trump said in a message on social media that the strikes had killed a “Senior ISIS Attack Planner and other terrorists he recruited” who were “hiding in caves.”
Somalia, though, is better known as a harbor for Al Shabab, the terrorist group linked to Al Qaeda, than for the Islamic State. U.S. intelligence officials estimate that Al Shabab in Somalia has roughly 7,000 to 12,000 members and an annual income — including from taxing or extorting civilians — of about $120 million, making it the largest and wealthiest Qaeda affiliate in the world.
However, after an Army veteran’s ISIS-inspired attack in New Orleans on New Year’s Day and amid fears of a resurgent Islamic State in Syria after the fall of President Bashar al-Assad’s government, counterterrorism specialists have warned the new administration that it needs to take such threats seriously.
“For Trump, this is important to show a muscular response, especially if he plans to draw down U.S. troop levels from conflict zones,” said Colin P. Clarke, a counterterrorism analyst at the Soufan Group, a security consulting firm based in New York.
President Trump withdrew about 700 U.S. troops from Somalia in January 2021. President Joseph R. Biden Jr. redeployed around 450 of those forces after he took office. It is unclear what Mr. Trump might do this time. Those troops provide training to Somali forces and do not conduct counterterrorism operations, Pentagon officials said.
The strikes on Saturday also aimed to counter critics who say that rushing active-duty troops to the southwestern border to stem the flow of migrants — a top priority for Mr. Trump — could jeopardize other military missions.
Mr. Hegseth said on Saturday that the United States “stands ready to find and eliminate terrorists who threaten the United States and our allies, even as we conduct robust border-protection” missions.
To be sure, there are threats in northern Somalia, where the Islamic State operates.
In May, the military carried out an airstrike against ISIS fighters in a remote area southeast of Bosaso, Somalia, and killed three. Some analysts thought the strike killed a Somali militant believed to be the head of ISIS’s worldwide operations. That assessment proved incorrect, counterterrorism officials said.
In January 2023, U.S. Special Operations commandos killed a senior Islamic State leader in an early morning helicopter raid in a remote area of northern Somalia.
The Pentagon identified the leader, one of the terrorist group’s top financial operatives, as Bilal al-Sudani. American officials said that he was operating in Somalia but that his influence extended across Africa, into Europe and even to the ISIS branch in Afghanistan that carried out the August 2021 bombing at Kabul’s airport that killed 13 American service members.
That raid took place in a remote mountainous cave complex in the Puntland region of northern Somalia, months after American spy networks detected Mr. al-Sudani’s hidden headquarters and monitored the location to study his movements.
The commandos scooped up laptop computers and hard drives, cellphones and other information from Mr. al-Sudani’s hide-out that have provided leads in other counterterrorism operations.
Treasury Secretary Scott Bessent gave representatives of the so-called Department of Government Efficiency full access to the federal payment system late on Friday, according to three people familiar with the change, handing Elon Musk and the team he is leading a powerful tool to monitor and potentially limit government spending.
The new authority follows a standoff this week with a top Treasury official who had resisted allowing Mr. Musk’s lieutenants into the department’s payment system, which sends out money on behalf of the entire federal government. The official, a career civil servant named David Lebryk, was put on leave and then suddenly retired on Friday after the dispute, according to people familiar with his exit.
The system could give the Trump administration another mechanism to attempt to unilaterally restrict disbursement of money approved for specific purposes by Congress, a push that has faced legal roadblocks.
Mr. Musk, who has been given wide latitude by President Trump to find ways to slash government spending, has recently fixated on Treasury’s payment processes, criticizing the department in a social media post on Saturday for not rejecting more payments as fraudulent or improper.
It is not clear whether the team led by Mr. Musk, the world’s wealthiest man, has blocked any payments since gaining access to the system.
The Department of Government Efficiency, or DOGE, is not a government department, but a team within the administration. It was put together at Mr. Trump’s direction by Mr. Musk to fan out across federal agencies seeking ways to cut spending, reduce the size of the federal work force and bring more efficiency to the bureaucracy. Most of those working on the initiative were recruited by Mr. Musk and his aides.
Similar DOGE teams have begun demanding access to data and systems at other federal agencies, but none of those agencies control the flow of money in the way the Treasury Department does.
Mr. Bessent granted access to the payments system to a handful of staff members affiliated with DOGE, including Tom Krause, the chief executive of a Silicon Valley company, Cloud Software Group, according to one of the people familiar with the change. Access to the system has historically been closely held because it includes sensitive personal information about the millions of Americans who receive Social Security checks, tax refunds and other payments from the federal government.
A Treasury Department spokesman, a spokeswoman for DOGE and the White House did not immediately respond to requests for comment.
In a process typically run by civil servants, the Treasury Department carries out payments submitted by agencies across the government, disbursing more than $5 trillion in fiscal year 2023.
Former officials said the onus was on individual agencies to ensure their payments are proper, not the relatively small staff at the Treasury Department, which is responsible for making more than one billion payments per year.
Mr. Lebryk, the career Treasury official who retired on Friday, had resisted requests from members of Mr. Trump’s transition team for access to the data last month. After Mr. Trump took office, the White House indicated that he should be removed from the job and, according to a person familiar with the matter, Mr. Bessent suggested putting him on leave.
Democrats raised alarm this week that the Trump administration and Mr. Bessent, who was just confirmed by the Senate this week, were compromising the federal government’s payments system.
“To put it bluntly, these payment systems simply cannot fail, and any politically motivated meddling in them risks severe damage to our country and the economy,” Senator Ron Wyden of Oregon, the top Democrat on the Senate Finance Committee, wrote in a letter to Mr. Bessent on Friday. “I can think of no good reason why political operators who have demonstrated a blatant disregard for the law would need access to these sensitive, mission-critical systems.”
Mr. Wyden followed up on Saturday to express concern that access to the payment system had already been granted and pointed to Mr. Musk’s potential conflicts of interest.
“Social Security and Medicare benefits, grants, payments to government contractors, including those that compete directly with Musk’s own companies. All of it,” he wrote on social media.
During the transition, Mr. Musk vocally opposed Mr. Bessent being picked as Mr. Trump’s Treasury secretary. Mr. Musk, then just an empowered adviser to Mr. Trump, went public with his opinion that he preferred Howard Lutnick, a Wall Street executive, for the role because Mr. Bessent was “a business-as-usual choice.” Mr. Lutnick became Mr. Trump’s choice for Commerce secretary.
The Canadian government was notified on Saturday by the United States government that goods exported to the U.S. will be subject to a 25 percent tariff, with the exception of Canadian oil, which will be hit with a 10 percent tariff. Canada’s prime minister, Justin Trudeau, is planning to respond this evening, according to two senior Canadian government officials with direct knowledge of the notification.
While Canada’s export dependent economy has faced steep tariffs from the United States in the past, including during President Trump’s first term, nothing in recent years has been on the scale of the sweeping 25 percent tariff expected on Canadian exports.
The past may also offer little guidance as Canada prepares to respond.
When Mr. Trump in 2018 imposed 25 percent tariffs on steel exports and 10 percent levies on aluminum shipments from Canada, Mexico and the European Union, Canada struck back with tariffs targeting U.S. products largely made in states represented by Republican politicians it believed had influence over the U.S. president.
This time, Prime Minister Justin Trudeau, who was also Canada’s leader during Mr. Trump’s earlier term, has said that Canada will repeat that strategy.
But the bottom line of few major American industries depends on selling to Canada, a relatively small market that, in terms of population, is about the same size as California.
Canada is a major destination for Kentucky bourbon, and, in 2018, the Trudeau administration imposed tariffs on the spirit, a move Canadian officials have indicated they will pursue again. But of the Kentucky bourbon industry’s $9 billion in annual sales, the Canadian market accounts for just a sliver, about $30 million.
Mr. Trump’s tariffs on Canadian steel and aluminum raised costs for American consumers, but they also yielded an increase in U.S. production, creating new jobs, though not on the scale that the president had promised.
Mr. Trump ultimately withdrew the tariffs against Canada and Mexico after the two countries agreed to renegotiate the North American Free Trade Agreement.
Other major U.S. tariff hikes on Canadian goods took place before free trade between the two countries. In both cases, Canada’s response was to look for other countries to buy its products.
In 1930, a bill passed by Congress led to average import duties of 59 percent against Canadian goods. Canada responded with high duties of its own. But it saved its farmers and other sectors by boosting trade with Britain and other countries.
While Canada has a trade pact with Europe, modern supply chains would make it difficult to shift trading patterns.
When the Nixon administration applied across the board 10 percent tariffs on Canadian exports in 1971, Pierre Elliott Trudeau, the prime minister and father of Justin Trudeau, did not retaliate with tariffs. Instead, he ordered officials to examine various options to limit Canada’s economic vulnerability to changes in U.S. trade policy.
That eventually led to a free-trade agreement in 1989 with the United States that later grew into NAFTA.
A broad group of Arab nations on Saturday rejected an idea floated by President Trump for Gazans to be moved to Egypt and Jordan, saying in a joint statement that such a plan risked further expanding the conflict in the Middle East.
The statement, signed by Egypt, Jordan, Saudi Arabia and other Arab countries, did not refer to Mr. Trump’s comments explicitly but warned that any plan that encouraged the “transfer or uprooting of Palestinians from their land” would threaten stability in the region and “undermine the chances of peace and coexistence among its people.”
In recent days, Mr. Trump has suggested on multiple occasions that more Gazans should be evacuated from the enclave and taken in by Jordan and Egypt.
The far right in Israel has made similar calls for Palestinians to leave the territory.
“You’re talking about probably a million and a half people, and we just clean out that whole thing,” Mr. Trump said of Gaza last weekend. “I don’t know. Something has to happen, but it’s literally a demolition site right now.”
He said Palestinians could be in Jordan and Egypt “temporarily, or could be long-term.” It was unclear from Mr. Trump’s comments whether he was suggesting that the entire population of Gaza — more than two million people — should leave.
For Palestinians, even the suggestion of such a mass exile evokes painful historical memories: Hundreds of thousands of Palestinians were displaced to neighboring countries during the war surrounding Israel’s 1948 establishment. After they left, Israel did not allow them to return and many are still formally considered refugees.
Egypt and Jordan immediately spurned Mr. Trump’s call. Both countries have longstanding peace treaties with Israel and support a Palestinian state but also fear that a large influx of Palestinians who would remain indefinitely could stir domestic upheaval.
The office of President Abdel Fattah el-Sisi of Egypt said he had received a call from Mr. Trump on Saturday that touched on the Gaza cease-fire but made no mention of the idea to evacuate Gazans.
It described their exchange as positive and said they had agreed on the need to stabilize the Gaza cease-fire deal and advance the implementation of it, according to a statement from the Egyptian presidency. It called for stepping up humanitarian aid to Gaza.
The Egyptian leader stressed the importance of reaching a lasting peace in the Middle East.
“The international community places its trust in President Trump’s capacity to secure a historic and enduring peace agreement, which would bring an end to the decades-long conflict in the region,” the Egyptian statement said.
The statement by the Arab countries on Saturday was a notable show of unity from across the Arab world. The United Arab Emirates, Qatar, the Palestinian Authority and the secretary-general of the Arab League also signed onto the statement, which came after a meeting of foreign ministers in Cairo.
The statement said that the countries looked forward to working with the Trump administration “to achieve a just and comprehensive peace in the Middle East, in accordance with the two-state solution.”
During his previous administration, Mr. Trump submitted a plan that Palestinians said fell far short of giving them a truly independent state. It is still unclear what he may seek to advance during his current term and what his long-term visions for Gaza and the Israeli-occupied West Bank are.
The Trump administration has appeared eager to engage with the Gulf powerhouses of Saudi Arabia and the United Arab Emirates after the president enjoyed mostly friendly relations with both in his first term.
But Mr. Trump’s stance on Gaza could complicate those efforts.
His administration seeks to broker a wider Middle East peace agreement that would include normalizing diplomatic relations between Israel and Saudi Arabia, a deal that Mr. Trump sought during his first term.
But the war in Gaza, in response to the Hamas-led attack of Oct. 7, 2023, has prompted major shifts in the region.
Widespread anger over the war, which has killed tens of thousands of people and wreaked vast destruction and displacement of the population, has renewed attention on the issue of Palestinian statehood.
Saudi Arabia’s leader, Crown Prince Mohammed bin Salman, has said his country will not establish diplomatic relations with Israel without a Palestinian state.
Millions of Palestinian refugees are already living in camps in Jordan, Syria and Lebanon while others are living in Egypt and the United Arab Emirates. Egypt has also allowed more than 100,000 Gazans to cross into its territory since the war began in October 2023.
On Friday, a small group of Egyptians demonstrated on their side of the Rafah border crossing with Gaza as part of a protest against Palestinian displacement from Gaza. Rallies in autocratic Egypt are almost always staged or sponsored by the authorities.
Egypt and Jordan are both significant U.S. partners in the Middle East, and the U.S. government has typically seen their stability as key to the wider region. They both receive considerable U.S. funding. Egypt is the second-largest recipient of foreign aid after Israel.
The director of the Consumer Financial Protection Bureau, Rohit Chopra, was fired on Saturday, prematurely ending a five-year term that was scheduled to run through late 2026.
“With so much power concentrated in the hands of a few, agencies like the C.F.P.B. have never been more critical,” Mr. Chopra wrote in a letter he posted on social media announcing his departure.
Mr. Chopra expected to be fired immediately after President Trump took office, but he improbably hung on for nearly two weeks, even as the president ousted scores of other agency leaders. He used that time to impose a $2 million fine on a money transmitter and release reports on auto lending costs, specialty credit reporting companies and rent payment data.
When Congress created the consumer bureau in 2011 — to increase oversight of mortgage loans and other financial products in the aftermath of the Great Recession — it included guardrails to protect the agency’s independence and shield it from shifting political tides. But the Supreme Court ruled in 2020 that the president was free to fire the agency’s director without cause, which cleared the way for the bureau’s leadership to change with each presidential administration.
Mr. Chopra was a scourge of Wall Street, known for his aggressive approach to enforcing consumer protection laws and expanding their boundaries by issuing new rules. He led a crackdown that prompted most large banks to abandon or significantly reduce overdraft fees, and he ordered Wells Fargo to pay $2 billion in 2022 to customers harmed by its misdeeds, which included improperly seizing some borrowers’ cars and homes.
Mr. Chopra was especially focused on tightening the rules governing large technology companies’ consumer payment services and use of customer data, an effort that drew praise from banking trade groups. But those groups fiercely opposed many of his other actions, often tying them up in years of litigation.
As part of a Biden administration crusade against “junk fees,” Mr. Chopra issued a rule last year to limit most credit card late-payment fees to no more than $8 per month. Banking trade groups sued and won an injunction temporarily blocking it. The consumer bureau has fought the lawsuit, but a new director could choose to end that opposition and curtail or abandon the rule.
During President Trump’s first term, he installed an acting bureau director — Mick Mulvaney, who later served as his acting chief of staff — who sought to cut off the agency’s funding and cripple its enforcement efforts. He was succeeded by Kathleen Kraninger, who issued rules that gutted Obama-era regulations, including one that would have sharply curtailed payday lending. Former President Joseph R. Biden Jr. ousted Ms. Kraninger immediately upon taking office.
The bureau will be run by Zixta Martinez, its deputy director, until Mr. Trump chooses a new acting leader. Financial industry officials expect the agency to pare back its oversight, issue fewer new regulations and freeze or rescind some of those imposed by Mr. Chopra.
He used his departure letter, addressed to Mr. Trump, to pitch the bureau as a prospective partner in enacting consumer protections that the president has spoken of endorsing. On the presidential campaign trail, Mr. Trump said he would temporarily limit credit card interest rates to 10 percent.
“We also have analyzed your promising proposal on capping credit card interest rates, and we see a path for enacting meaningful reforms,” Mr. Chopra wrote.
When Dennis Nixon started working at a regional bank in Laredo, Texas, in 1975, there was just a trickle of trade across the border with Mexico. Now, nearly a billion dollars of commerce and more than 15,000 trucks roll over the line every day just a quarter mile from his office, binding the economies of the United States and Mexico together.
Laredo is America’s busiest port, and a conduit for car parts, gasoline, avocados and computers. “You cannot pick it apart anymore,” Mr. Nixon said of the U.S. and Mexican economies. Thirty years of economic integration under a free trade deal has created “interdependencies and relationships that you don’t always understand and measure, until something goes wrong,” he said.
Now that something is looming: 25 percent tariffs on Mexican products, which President Trump plans to impose on Saturday as he looks to pressure the Mexican government to do more to curb illegal immigration. Mr. Trump is also expected to hit Canada with 25 percent levies and impose a 10 percent tax on Chinese imports.
A longtime proponent of tariffs and a critic of free trade deals, Mr. Trump seems unafraid to upend America’s closest economic relationships. He is focusing on strengthening the border against illegal immigration and the flow of fentanyl, two areas that he spoke about often during his 2024 campaign.
But the president has other beefs with Mexico, including the economic competition it poses for U.S. workers. The president and his supporters believe that imports of cars and steel from Mexico are weakening U.S. manufacturers. And they say the United States-Mexico-Canada Agreement, the trade deal Mr. Trump signed in 2020 to replace the North American Free Trade Agreement, needs to be updated — or perhaps, in some minds, scrapped.
Many businesses say ties between the countries run deeper than most Americans realize, and policies like tariffs that seek to sever them would be painful. Of all the world’s major economic partners, the United States and Mexico are among the most integrated — linked by business, trade, tourism, familial ties, remittances and culture. It’s a closeness that at times generates discontent and efforts to distance the relationship, but also brings many benefits.
“Our countries have a symbiotic relationship,” said Juan Carlos Rodríguez, managing director in Tijuana for Cushman & Wakefield, one of the world’s biggest commercial real estate companies.
“Our economies are so intertwined that it would take decades to decouple,” Mr. Rodríguez said. “Such a scenario would have a catastrophic impact on Mexico.”
A natural partner
Mexico’s immense reliance on trade with the United States dates back at least to the 1960s, when manufacturers began opening factories just across the border as a response to climbing labor costs in the United States and Japan.
Trade picked up when NAFTA took effect in 1994. For many Americans, that trade pact is now synonymous with offshoring and decimated factory towns. But economists calculate that many parts of the United States benefited as the agreement increased trade and economic activity.
Other parts of the United States were severely hurt as manufacturers moved to Mexico in search of cheaper labor. As factory towns hollowed out, that ended up fueling a trade backlash, helping pave the way for anti-trade candidates like Mr. Trump to win office.
In an interview, Peter Navarro, the president’s senior counselor for trade and manufacturing, called NAFTA a “catastrophe” and bad for both Mexico and the United States.
“The fact of the matter is China was so much worse that people tend to forget how bad NAFTA was,” he said.
In his first term, Mr. Trump threatened tariffs on Mexico over border issues, but instead settled for a deal. He also repeatedly threatened to withdraw from NAFTA, but instead decided to renegotiate it. His advisers added provisions to the pact they believed would bolster U.S. steel and auto manufacturing, but some now say they have fallen short.
Since Mr. Trump was last in the White House, Mexico’s importance to the U.S. economy has grown. The Covid-19 pandemic disrupted global supply chains and started a “nearshoring” boom.
Companies were already looking to move out of China, to avoid tariffs Mr. Trump imposed there, as well as rising costs and political risk. Manufacturers rushed to open plants in Mexico, seizing on the country’s low-cost industrial base and proximity to the United States.
Those changes helped make Mexico the United States’ top trading partner in goods in 2023. As trade between the countries has expanded, so has the bilateral trade deficit with Mexico, a metric that Mr. Trump is particularly focused on.
American consumers may be as reliant on foreign products as ever. But economists argue that imports from Mexico can have quite different implications for the U.S. economy than imports from China.
That’s because there are many integrated supply chains that run back and forth across North American borders. Goods like cars, electronics and bluejeans are volleyed back and forth among the United States, Mexico and Canada as they are turned from raw materials into parts and then final products.
According to economists at S&P Global, of the imports coming into the United States from Canada and Mexico, more than 18 percent of their value was created in the United States, before being sent to those countries. That’s far more than the proportion for other countries, and a sign of how closely the economies are integrated.
Proximity creates other benefits: Research by the Federal Reserve Bank of Dallas has found that a 10 percent increase in factory output in Ciudad Juárez, Mexico, leads to a 2.8 increase in total employment in El Paso, Texas, concentrated in areas like transportation, retail and real estate.
“There’s this perception that the border is all about walls and illegal crossings,” said Diego Solórzano, the founder of Desteia, which helps companies making supply chain decisions. “This line in the sand is actually the most powerful economic corridor on Earth.”
Roughly $800 billion worth of goods were transported across the border last year, Mr. Solórzano said, an amount that would position the U.S.-Mexico border in striking distance of the world’s 20 largest economies.
The two economies rely on each other for their energy needs. Mexico, which depends on the United States for an estimated 70 percent of its natural gas consumption, is more vulnerable to any disruptions.
But the United States also imports about 700,000 barrels of crude oil a day from Mexico. Imposing import taxes on such cargoes could produce increases in fuel prices, particularly diesel, energy analysts warn.
Food production is also closely integrated. Mexico supplies roughly half of America’s fresh fruit and vegetables, and that proportion rises in winter months. Mexico also emerged last year as the top market for American agricultural exports, totaling $30 billion.
Bob Hemesath, a fifth-generation farmer in northeastern Iowa, said that Mexico was the biggest buyer of American corn and also a big purchaser of hogs, both of which he produces.
Tariffs would “put an added cost on a product that doesn’t need to be there, and it’ll drive those countries to go look somewhere else,” Mr. Hemesath said. He spoke by phone from his farm on an unseasonably warm day, where he had just finished power-washing a hog facility.
“It puts me as a farmer at an economic disadvantage,” he said. “Although I understand wanting to use tariffs as a negotiating tool, what harm do you do?”
Some Trump officials think corn exports haven’t been entirely benign. Mr. Navarro said that NAFTA had kick-started America’s illegal immigration problem, because when the United States began exporting corn to Mexico after the trade pact took effect, that put Mexican agricultural workers out of jobs, sending some of them into the United States.
“That’s where that began, our illegal immigration problem,” he said.
Trade irritants
Mr. Trump and his supporters have other criticisms of the United States-Mexico relationship. Some argue that Mexico has violated the terms of an agreement it made to limit its steel exports to the United States. They say Mexican shipments of steel to the United States have exceeded the levels set by that agreement, which was signed alongside the U.S.M.C.A.
(The Mexican steel industry has its own complaints. On Tuesday, Canacero, a Mexican steel organization, claimed in a statement that it had seen a significant surge in exports of finished steel products from the United States that did not comply with the agreement.)
There are also growing concerns about Mexico’s trade with China, particularly in the auto sector. Chinese car exports to Mexico have soared, and some Chinese car companies have been scouting for Mexican factory sites.
That has fueled concerns that Chinese companies will use Mexico as a jumping off point to export to the U.S. market at much lower tariff rates than if they were shipping goods from China.
Brad Setser, an economist at the Council on Foreign Relations, said that Mexico’s role as a conduit for Chinese goods to the United States had been overstated, but that “there absolutely is an issue in the autos sector.” One out of three cars sold in Mexico last year came from China, he said. That means Chinese exports are now meeting Mexican demand for cars, rather than exports from the United States, a blow to the U.S. auto industry.
Other business owners argue that the United States and Mexico should work together to limit imports from China — but say that doesn’t call for high tariffs on Mexican products.
Greg Owens, the chief executive of Sherrill Manufacturing, a flatware manufacturer in Sherrill, N.Y., said he would like to see tariffs structured in a way that inhibits China from using Mexico as a back door to the United States. But he opposes putting tariffs on Mexico outright, saying China is a much larger threat.
“China packing up a flatware factory in Guangzhou, setting up shop in Mexico just to circumvent tariffs — that needs to be dealt with,” he said. “But you can’t destroy your trade relationship with Mexico.”
Richard Grenell, President Trump’s envoy for special missions, said on social media that he was flying home from Venezuela with six American detainees on Friday, after meeting with the country’s president.
There were at least nine people with U.S. citizenship or residency detained in Venezuela, according to Venezuelan officials. The government had accused some of them of plotting to kill the country’s president, Nicolás Maduro.
“Just been informed that we are bringing six hostages home from Venezuela,” Mr. Trump said on social media. “Thank you to Ric Grenell and my entire staff. Great job!”
The United States has no diplomatic presence in Venezuela, and the U.S. government was not even sure where its citizens were being held, a State Department representative said this month.
Relatives of three detained U.S. citizens said they had gotten very little information from the American government and had not heard from their loved ones for months since they had disappeared.
David Estrella, 64, who worked in quality control for pharmaceutical companies in New Jersey, was among those released, according to his family.
“After such horrible moments that we and David have suffered unjustly, we look forward to welcoming him home and taking care of him until he fully recovers and leaves all this unfortunate incident behind him,” said Elvia Macias, Mr. Estrella’s former wife and close friend. He had entered Venezuela from Colombia to visit friends, Ms. Macias said.
Mr. Maduro, an autocrat whose country has seen an extraordinary exodus in recent years, has become increasingly isolated on the global stage, accused of having stolen the last presidential election in July. The United States has recognized the opposition candidate as the legitimate winner.
After the disputed elections, Mr. Maduro started rounding up foreign prisoners, a move that former U.S. diplomats and analysts said they saw as seeking bargaining chips to use with other nations.
Mr. Trump’s foreign policy team includes many aides who support taking a hard line against Mr. Maduro, and policy experts said the Venezuelan leader most likely feared that Washington would take a tougher stance, including potentially imposing more economic sanctions.
Mr. Maduro, who has spent his entire tenure blaming Venezuela’s economic woes on U.S. imperialism, talked about starting a new era of engagement with the United States in televised remarks on Friday. He did not directly refer to the released Americans.
“We are starting a new beginning of historical relations where what needs to be done will be done and what needs to be rectified will be rectified,” he said. “We love and admire the people of the United States.”
Mr. Maduro also referred to his meeting with Mr. Grenell as “frank, direct, open and positive” and said: “We are not anti-American nor have we ever been anti-American. We are anti-imperialist, which is different.”
But Mauricio Claver-Carone, the U.S. special envoy for Latin America, said in a call with journalists on Friday morning that Mr. Grenell would not make any concessions in exchange for releasing American detainees.
“This is not a quid pro quo,” he said. “It’s not a negotiation in exchange for anything.” He urged the Maduro government to “heed” to Mr. Grenell’s demands “because ultimately there will be consequences otherwise.”
Julie Turkewitz contributed reporting from Santander, Colombia.
In the latest effort to put his stamp on the federal work force, President Trump on Friday issued a memorandum invalidating government labor contracts finalized in the last 30 days before a presidential inauguration.
The policy applies to certain contracts negotiated toward the end of the Biden administration, the memo says. Such “last-minute, lame-duck” agreements, it states, “are purposefully designed to circumvent the will of the people” and “inhibit the President’s authority to manage the executive branch.”
Unions at several agencies rushed to negotiate collective bargaining agreements ahead of Mr. Trump’s inauguration to preserve some practices of the previous administration, like remote work, and insulate them from changes that could make it easier to fire civil servants.
The memo appears to allude to such practices, which it calls “inefficient and ineffective,” and cites an agreement with the Education Department that attempts to preserve remote work arrangements. The memo says the agreements could be undone if they have not yet been approved by an “applicable” agency head.
Other agencies, like the Social Security Administration, approved new collective bargaining agreements outside the 30-day window, presumably leaving them unaffected by the memo.
It was unclear if the memo would survive legal pushback initiated by federal employee unions, though it appeared to anticipate legal challenges, noting that it should remain in force if a portion alluding to prohibited bargaining agreements from the Biden administration is found to be invalid.
“Federal employees should know that approved union contracts are enforceable by law, and the president does not have the authority to make unilateral changes to those agreements,” Everett Kelley, the president of the American Federation of Government Employees, said in a statement. “Members will not be intimidated. If our contracts are violated, we will aggressively defend them.”
The Trump administration plans to scrutinize thousands of F.B.I. agents involved in Jan. 6 investigations, setting the stage for a possible purge that goes far beyond the bureau’s leaders to target rank-and-file agents, according to internal documents and people familiar with the matter.
The proposal came on a day that more than a dozen prosecutors at the U.S. attorney’s office in Washington who had worked on cases involving the Jan. 6 riot were told that they were being terminated.
The moves were a powerful indication that Mr. Trump has few qualms deploying the colossal might of federal law enforcement to punish perceived political enemies, even as his cabinet nominees offered sober assurances they would abide by the rule of law. Forcing out both agents and prosecutors who worked on Jan. 6 cases would amount to a wide-scale assault on the Justice Department.
On Friday, interim leaders at the department instructed the F.B.I. to notify more than a half-dozen high-ranking career officials that they faced termination, according to a copy of an internal memo obtained by The New York Times.
The acting deputy attorney general, Emil Bove, also told the acting leadership of the F.B.I. to compile a list of all agents and F.B.I. staff “assigned at any time to investigations and/or prosecutions” relating to the events at the Capitol on Jan. 6, 2021 — the day a mob of Trump supporters stormed through the halls of Congress.
In issuing his directive, Mr. Bove, who has overseen an opening volley of threats, firings and forced transfers since the inauguration, cited Mr. Trump’s executive order vowing to end “the weaponization of the federal government.”
Under President Joseph R. Biden Jr., the government waged a “systematic campaign against its perceived political opponents,” including by deploying law enforcement to pursue its rivals, he said.
The memo also demands the names of agents who worked on a case against Hamas leadership, though it is not clear why it was added to the list of agents under scrutiny. Prosecutors and agents had disagreed about the merits of the case.
The office of the deputy attorney general “will commence a review process to determine whether any additional personnel actions are necessary” against those F.B.I. agents, analysts and staff, according to the memo, which was addressed to Brian Driscoll, the acting F.B.I. director.
In an email to F.B.I. employees Friday night, Mr. Driscoll noted that he was among the agents who would be on such a list. The F.B.I. has been told to submit the list of names by Tuesday.
“We understand that this request encompasses thousands of employees across the country who have supported these investigative efforts,” Mr. Driscoll wrote, who added that he and his deputy “are going to follow the law, follow F.B.I. policy and do what’s in the best interest of the work force and the American people — always.”
Later, the F.B.I.’s counterterrorism division sent an email to field offices around the country with instructions about filling a database with bureau personnel who worked on the cases — a number likely to be about 6,000.
People familiar with the internal discussions said that some Trump administration officials are moving to force scores, or possibly hundreds, of agents out of the F.B.I. in the coming days and weeks. Officials have discussed notifying a large number of agents that they face possible termination, demotion or transfer.
At the U.S. attorney’s office in Washington, more than a dozen prosecutors who had worked on Jan. 6-related cases were told that they were being terminated, according to people familiar with the notices.
Those informed of their dismissals had been hired as the office struggled to manage what became the largest prosecution in the department’s history.
In another memo, Mr. Bove said the prosecutors in question had been short-term hires that were improperly made permanent staff during the Biden administration. “I will not tolerate subversive personnel actions,” he wrote.
Mr. Bove offered no evidence those targeted had done anything improper, illegal or unethical. Instead, he cited a legal technicality and questioned whether those targeted would allow the U.S. attorney’s office to “faithfully implement the agenda that the American people elected President Trump to execute.”
The moves come just one day after Kash Patel, Mr. Trump’s pick to lead the F.B.I., testified before Congress that the bureau would not be targeted for political reasons.
“All F.B.I. employees will be protected against political retribution,” Mr. Patel said during his confirmation hearing on Thursday.
Around the time that Mr. Patel appeared before the committee, a handful of senior F.B.I. employees were informed that they needed to resign in a matter of days or be fired, part of a broader effort by the Trump administration to shake up the agency’s upper ranks.
The moves are highly unusual in part because they are happening before a director has been confirmed to take charge of the bureau. The timing of these moves — made while the nominations of Mr. Patel and Pam Bondi for attorney general are still pending — could lessen the blowback for them — or it could jeopardize their support among Republican senators.
A department spokesman, and Mr. Patel’s representative, did not immediately respond to requests for comment. F.B.I. officials declined to comment. The people familiar with the planning spoke on the condition of anonymity to describe internal discussions.
In a statement, the F.B.I. Agents Association said that if true, “these outrageous actions by acting officials are fundamentally at odds with the law enforcement objectives outlined by President Trump.”
“Dismissing potentially hundreds of agents would severely weaken the bureau’s ability to protect the country from national security and criminal threats,” the statement continued.
If the administration follows through, it would be a singular moment in the F.B.I.’s history, and fly in the face of decades worth of civil service laws that are meant to protect the integrity and professionalism of the government work force.
Mr. Patel, speaking under oath, also promised to follow established bureau procedures in seeking terminations or transfers, including referring accusations of improper conduct by prosecutors to the Justice Department’s inspector general before taking action.
F.B.I. officials were already bracing for swift changes, but the forced retirements and the dismissal of senior agents in the field and at headquarters this week has led to immense unease. Agents are worried that they will be fired for investigations that angered Mr. Trump — especially those who worked on squads at the Washington field office on the criminal inquiry into Mr. Trump’s handling of classified documents as well as the inquiry into a fake electors’ scheme.
Two of the senior agents who ran field offices in Miami and Las Vegas and were forced out had been criticized by former agents with ties to Mr. Patel’s foundation, a nonprofit that Mr. Patel has said gives aid to a range of recipients, including the families of those charged in the Jan. 6 riot.
Some F.B.I. personnel expressed frustration that the bureau’s leadership provided little guidance as rumors circulated widely about firings and about colleagues being escorted out of field offices. Mr. Driscoll’s email Friday night ended some of that confusion, though it confirmed some of their deepest fears.
Jason Manning, a former federal prosecutor who worked on Jan. 6 cases, warned of the consequences.
“It will mean firing agents who investigate child sex crimes, violent crimes, immigration crimes, Chinese espionage and lots of other criminal activity that President Trump claims to care about,” he said. “Our country is significantly weaker and more dangerous because of this.”
The disarray in the bureau was also evident on its website, which notably omitted the name of the acting director, Mr. Driscoll. Inside the bureau, one person said that the atmosphere was sullen and that employees were startled by what was unfolding as top F.B.I. officials scrambled to complete the required retirement paperwork, with the agents turning in their badges.
Mr. Driscoll and Robert C. Kissane, his acting deputy, said goodbye to their colleagues.
In an interview, Democratic lawmakers denounced the moves.
“They are hollowing out our professional law enforcement community,” said Senator Richard Blumenthal of Connecticut, a Democrat who questioned Mr. Patel at the confirmation hearing. “It is the absolute height of arrogance to be doing exactly what their F.B.I. nominee promised not to do.”
Retribution has been swift at the Justice Department as about a dozen prosecutors who worked on the two criminal investigations into Mr. Trump for the special counsel Jack Smith were fired.
Mr. Trump once called the Jan. 6 riot a “heinous attack,” but in one of his first official acts, he granted sweeping clemency to all of the nearly 1,600 people charged in the assault. He issued pardons to most of the defendants and commuted the sentences of 14 members of the Proud Boys and the Oath Keepers militia, most of whom were convicted of seditious conspiracy.
During Mr. Patel’s testimony on Thursday, Senator John Kennedy, Republican of Louisiana, told Mr. Patel that lawmakers would hold him accountable if he tried to exact revenge at the F.B.I., saying two wrongs did not make a right.
“And there have been and may still be some bad people there, and you’ve got to find out who the bad people are and get rid of them, in accordance with due process and the rule of law,” Mr. Kennedy said. “And then you’ve got to lift up the good people. Don’t go over there and burn that place down. Go over there and make it better.”
The F.B.I. has been in turmoil since Christopher A. Wray, the former director, stepped down before Mr. Trump took office. After Mr. Wray’s deputy abruptly resigned and shortly after Mr. Trump took office, the administration identified the wrong agent as acting director.
Instead of correcting the error, officials kept it in the hope that a new director would be quickly confirmed, The Wall Street Journal earlier reported.
Mr. Kissane, who had been the top counterterrorism agent in New York, had been widely believed to be in line to be acting director, several current and former agents said, with Mr. Driscoll, a decorated agent in the F.B.I.’s New York field office as the No. 2. But when the White House unveiled its website after Mr. Trump was inaugurated, Mr. Driscoll was named in the top job.
Alan Feuer and Eileen Sullivan contributed reporting.