Edith Olmsted

While Trump's tariffs on Mexico are expected to cause consumer prices to soar for a number of imported products, they would have far wider adverse effects on the U.S. economy. Specifically, they will make life tough in Texas, where a majority of the residents voted for the tariff-touting incoming president.

Ray Perryman, the CEO of the financial analysis firm the Perryman Group, told Newsweek that the negative effects of Trump's tariffs will likely hurt the Lone Star State the most "because of its proximity to and integration of supply chains with Mexico."

"Texas would see a disproportionate impact, which we estimate to be about $46.9 billion in yearly gross state product (about 1.7 percent of the total) and approximately 370,000 jobs," Perryman said.

Donald Trump has proposed sweeping tariffs on Mexico.

Donald Trump's tariffs will likely take the biggest toll on Texas, multiple economics experts told Newsweek. Last week, the president-elect announced plans to impose 25 percent tariffs on all goods imported from China, Canada, and Mexico "until such time as Drugs, in particular Fentanyl, and all Illegal Aliens stop this Invasion of our Country!"While Trump's tariffs on Mexico are expected to cause consumer prices to soar for a number of imported products, they would have far wider adverse effects on the U.S. economy. Specifically, they will make life tough in Texas, where a majority of the residents voted for the tariff-touting incoming president. Ray Perryman, the CEO of the financial analysis firm the Perryman Group, told Newsweek that the negative effects of Trump's tariffs will likely hurt the Lone Star State the most "because of its proximity to and integration of supply chains with Mexico.""Texas would see a disproportionate impact, which we estimate to be about $46.9 billion in yearly gross state product (about 1.7 percent of the total) and approximately 370,000 jobs," Perryman said. Perryman warned that, if implemented, 25 percent tariffs on all goods from Mexico and Canada would result in an estimated loss of $250.6 billion in annual national gross domestic product and approximately 1.97 million jobs, amounting to nearly 1 percent of the U.S. GDP.Gary Clyde Hufbauer, a senior fellow at the Peterson Institute for International Economics, told Newsweek that he agreed that the proposed tariffs would "severely impact" Texas."Not only all those avocados, mangos, beer, tequila etc. becoming more expensive to Texas consumers, but the decline in cross-border truck and rail traffic will throw a lot of Texans out of work," he said. "Then there is the loss of Texas sales of consumer goods, cattle, gas, petroleum and electricity to Mexico. Thrown in a decline in Mexican tourism in Texas."Tony Payan, the director for the Center for the U.S. and Mexico at Rice University's Baker Institute for Public Policy, told Texas Standard that the "stakes could be high for both Texas and Mexico" when it came to Trump's proposed tariffs."The amount of trade between the two countries is $800 billion a year. Half of that—$400 billion—is essentially what we could call intra-firm trade," Payan said. "That is, trade that occurs between manufacturing firms—the parts that come from Mexico or come from the United States into Mexico to complete the cars and to complete the goods that are traded."Payan added that he wasn't sure Trump would "make good" on his promise to impose tariffs and ultimately he believed the president-elect would realize just how "integrated" the two economies had become. Maxwell Marlow, director of research at the Adam Smith Institute, voiced similar concerns to Newsweek, explaining that Trump's tariffs would "be particularly devastating for areas such as Texas, where goods cross borders multiple times during their production."Marlow added that the U.S. should expect retaliatory tariffs from Mexico, which would also disproportionately hurt Texas. Part of why retaliatory tariffs would be so damaging is because Mexico receives a whopping 29 percent of Texas's exports, Professor Dennis Jansen, head of the economics department at Texas A&M University, explained to Newsweek."If there is retaliation from abroad—say if Mexico follows through on the threat to raise tariffs on goods exported from the U.S. to Mexico—this will further reduce the demand for Texas (and overall U.S.) exports," Jansen said.

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