It has been an eventful meeting for cross-border stakeholders gathered in Tijuana. The meeting of Mexican business leaders and economic development experts heard about Donald Trump the border while executive action and yesterday about the possibility of a 20% United States tariff on Mexican goods. The group includes the Chamber of Commerce is mounting to get out the word on those ties that bind United States and Mexico. Joining me the vice president of international business affairs of the San Diego regional Chamber of Commerce. Welcome to the show. Thank you for having me. Even though this 20% tax appears to be only an idea it's not a formal proposal, how much of an impact could have an San Diego's economy? While Sandy Raed -- San Diego relies heavily on the relationship with Mexico. And over 100,000 jobs they support alone. These are jobs that are directly impacted not to mention, the jobs that are not directly supported by the trade which would be impacted as well and not to mention the impact on consumer prices which would hit all of our walls. And how would consumer see the impact? With a seat at the grocery store? They would see it at the grocery store, when purchasing a vehicle, it would be a wide range of products that would be impacted and businesses will adjust according to the market demand and cost. They are going to pass on those cost the consumer. What industries would be harnessed by this if it were to go through? I think that the automobile industry potentially it is estimated at 31,000 jobs they could lose. So aside from the increase of prices, those jobs that are currently staying here in the United States, are at risk. And, the assembly is occurring in Mexico the reason why they benefit because of the proximity to Mexico and production will be moved overseas. And, use of products there locally versus our component. And part of the complexity of this relationship. Is that these things are made in Mexico come to the United States and then sent back to the United dates while that is being made? That's right we have a very integrated supply chain where they have the border 7 to 12 time in fact as components are added each time. So, I don't know if the proposal would be to import each component or the final product in either case, it would result in a tremendous amount of job loss not to mention the increase in prices of goods. We would feel that in our wallets. It is estimated by many economic studies showing that the impact on the average American household is $10,000 annual savings. Because of the trades policies. That could potentially impact us at that level. What about Mexico retaliating by setting up its own tax on American goods? What is the projected fallout in San Diego? That's absolutely correct. Enter into a trade war at that point. And, Mexico is San Diego's number one export market. We export $5.5 billion a year in Mexico. It would be very difficult to replace that. Or you know, the impact that would be felt you know, it's unparalleled. So we have been talking mainly about San Diego do you see this economic impact throughout the United States economy? Absolutely I just mentioned that $5.5 billion market. We ranked number nine, and there are eight other cities throughout the country that export more than we do to Mexico. Many of those are located far up north into the northeastern coast New York City, Chicago, Charlotte, they all export even more to Mexico than we do. And these are actual exports of goods. It does not take into consideration the service industry. And that You have spoken with businesses who are holding off given all of this uncertainty. What else is the business community telling you? Yes, you know investments are put on hold and that's the other part of this equation. It's direct investments. And, San Diego benefits from imports. The imports that we -- that countries that import export into the United States invest in the United States so there's a very -- there's concerns about losing out on that investment for sure. The uncertainty is never good for business communities. We rely on a stable workforce. We rely on stable policies. And the unpredictability is immediately impacted. I have been speaking with Paula thank you so much.
Updated at 6:45 p.m. ET
The Trump administration is considering alternative ways to pay for the border wall, backtracking on the president's oft-repeated promise that Mexico would foot the bill.
A White House spokesman said one idea taking shape is to apply a 20 percent tax on imports from Mexico, as well as other countries with which the U.S. has a trade deficit. That would effectively saddle U.S. consumers with a significant portion of the wall's cost, estimated at $15 billion or more.
Trump's spokesman Sean Spicer did not offer details about how the import tax would work, but he said it could be adopted as part of comprehensive tax reform. After the idea sparked controversy, Spicer later walked back the idea, saying that "it could be a multitude of things." The tax could be 20 percent or 18 or 5, he said, adding that he wasn't trying to be "prescriptive."
Trump discussed the plan during a meeting in Philadelphia with congressional Republicans.
Even floating this idea amounts to a remarkable capitulation by the new president, who was insisting as late as Wednesday that Mexico would bear the cost of the border barrier.
Mexico's refusal has already created friction between the countries. Mexican President Enrique Peña Nieto abruptly canceled a planned meeting with Trump next week, a decision that the U.S. president tried to explain as mutual.
Mexico is one of America's top trading partners, with more than $500 billion worth of goods flowing across the Southern border each year. Spicer argued that adding a 20 percent surcharge to imports from Mexico would quickly cover the cost of the wall.
"This is the beginning of this plan to make sure it's done right," Spicer told reporters traveling aboard Air Force One. "It clearly provides the funding and it does so in a way that ensures that the American taxpayer is wholly respected."
The suggestion drew a swift rebuke from at least one Republican senator, South Carolina's Lindsey Graham, who said it would be a bad idea to do anything that raises the price of Corona, tequila or margaritas. (Graham's family used to own a bar.)
House Speaker Paul Ryan's office contended the White House and Congress were on the "same page."
"We have been and continue to be on the same page about tax reform that supports American jobs and American goods," Ryan aide AshLee Strong told NPR's Susan Davis.
That's because Ryan has proposed a "border adjustment" tax that would affect the "corporate tax rates applied to goods and services consumed in the U.S. but not applied to goods and services exported," a Republican Capitol Hill source added.
The plan would allow corporations to subtract export sales when calculating their tax bill, but companies would not be allowed to deduct the cost of imports. Under the current tax code, export sales are taxed, and import costs are deductible.
If Trump is embracing Ryan's plan, it would be a reversal. Just 10 days ago, he told the Wall Street Journal that a "border adjustment tax" was "too complicated."
"Anytime I hear border adjustment, I don't love it," Trump said. "Because usually it means we're going to get adjusted into a bad deal. That's what happens."
Texas Republican Sen. John Cornyn said the plan raises questions.
Spicer brushed aside suggestions that much of the cost would be passed on to American consumers who purchase Mexican-made goods. He argued that cost would be outweighed by the reduction in illicit border crossings.
"What it's going to do is lift up the wages of American workers," Spicer said. "Right now we've got an influx of cheap labor. It's going to put the American consumer back, net-net, to make sure that American workers get lifted up as well."
Back in Washington, after the original comments, Spicer said, "I don't think our job right now is to roll something out and/or be prescriptive; it's to show that there are ways the wall can be paid for. Full stop."
He added that he was trying to address "questions about how the president could pay for the wall."
He said, "The idea is to show that generating revenue for the wall is not as difficult as some might have suggested." But "there's nothing to roll out, so the idea of asking for details on something, we're not there yet."
Spicer also suggested that building the border wall would produce savings elsewhere in the federal budget.
"I think we're going to save additional money that we would have had to spend on tracking down illegal immigrants and on immigration," Spicer said. "So it's actually a huge win for the American taxpayer and for American security when you look at the kind of plan that's coming to fruition right now."
Trump actually wants to increase spending on immigration enforcement. In addition to the wall, he has ordered the hiring of 15,000 new Border Patrol and immigration officers and the construction of new detention facilities.
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