A twenty per cent tariff gives the Mexican exporter two choices.
1. Raise prices, thus passing along the coast. BUT that makes his exports less competitive and could cost him sales.
or
2. Absorb the cost of the tariff in reduced profits.
Both of these would be unpleasant for the Mexicans and provide revenue for the Wall.
Better if the Mexicans just give US what we want.
You seem to have forgotten choice 3. Sell your product to another nation with no tariff, instead. When the North cut off all Southern Cotton sales to Britain in the Civil War, the South fully expected that Britain would enter the war on their side. Instead, Britain discovered Egyptian cotton, which up until then, had no market, and the Southern economy did not recover for 100 years.
No other nation is prepared to put up with the one sided trade that Mexico has had with US.
Well, since Mexico has already said that we can expect retaliatory tariffs , and since we presently export almost $20 billion in products to Mexico per year, and since Peru and Columbia has already declared that they will stand by Mexico in this trade dispute, I suspect that only someone who is really naive, or totally narcissistic, like Trump, can think that this is not going to adversely affect the American economy.
We have ALREADY been adversely affected by out terrible trade positions.
THis is us addressing that.
If Mexico would rather have a trade war, than mutually beneficial trade, that is their choice.
..and we are going to pay for it. THAT will show them! BTW, Chipotle's is already tightening their belt, and talking about having to raise their prices and/or change their menus. More importantly, the farmers in the Midwest would be hurt the hardest. These folks, not being the brightest voters in the country, export hundreds of millions of dollars worth of soybeans, wheat, and other agricultural products to Mexico. So, I guess that there really is a bright spot for America. Mexican retaliatory tariffs would cause a glut on these product in this country, and the price of bread will go down. Tough on farmers, but, what the hell, they put asshole in office.
When you advocate that we repeal the NAFTA agreement, and put a 20% tariff on Mexican products, and then say that if they want a trade war, that is their decision, it is sort of like Japan bombing Pearl Harbor, and then saying that if America wants war, then it is our decision.
Meantime, here are some likely scenarios:
A 20% Mexico tariff would pay for the wall. But it would hurt Americans