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As the Trump administration weighs implementing tariffs on Mexican beer, a new report argues the move would hurt the very American workers it is intended to protect by squeezing one of the U.S. beer market’s most profitable segments.
The report, authored by Unleash Prosperity co-founder Stephen Moore and economist David Ozgo, comes as the Trump administration continues to expand its tariff agenda, which officials say is aimed at re-shoring manufacturing, reducing trade deficits and strengthening American industry.
“There probably are some products for which tariffs are appropriate — products where there might be national security implications,” Ozgo told Fox News Digital. “But obviously, beer is not one of those products.”
While Mexican beer is brewed south of the border, Ozgo said most of the jobs it supports, like distribution, wholesaling and retailing, are in the United States.
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The report backs that claim with data showing the U.S. beer business supports roughly 1.74 million jobs, but only about 5% are directly involved in brewing. Most workers are employed by wholesalers, retailers, restaurants and suppliers that handle beer after it is brewed, jobs that remain in the U.S. even when the beer is imported.
“If you end up slapping tariffs on Mexican beer, you’re not protecting American workers,” Ozgo said. “What you’re really doing is cutting into the most profitable segment of the beer market right now and in turn putting U.S. jobs at risk.”
According to the report, Mexican beer already sells for about 52% more than mass-market domestic lagers in grocery and liquor stores. The authors say those higher prices mean bigger profits for U.S. distributors, retailers, restaurants and bars, helping support more American jobs than cheaper domestic lagers.
Those higher prices create more value across the U.S. economy, the report notes.
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The authors estimate that every gallon of Mexican beer generates about $26.27 in economic value. About $19.42 of that — roughly 74% — goes to U.S. businesses and workers through distribution, retail, transportation, marketing, taxes and other domestic economic activity. By comparison, leading domestic beers generate about $15.76 in total value per gallon.
Ozgo said tariffs would ultimately force brewers to either absorb the added costs, reduce investment, or pass the costs on to consumers through higher prices.
“Either the company itself has to eat the cost of the tariff, or they pass the cost to the consumer,” he said. “Either outcome isn’t very good.”
The report also argues that moving production of Mexican beer to the United States could undermine the brands’ authenticity and value, pointing to Anheuser-Busch InBev’s decision to move production of Beck’s beer from Germany to Missouri, which led to consumer litigation after the company continued marketing the beer as German.
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It also notes that Constellation Brands, which imports Corona, Modelo and Pacifico, operates under a Justice Department consent decree requiring those brands to be produced in Mexico.
“Consumers really, really value authenticity,” Ozgo said. “When you move an import into the United States and you continue to market it as an import, you end up losing value.”
The Trump administration has argued more broadly that tariffs are intended to encourage domestic manufacturing and strengthen American industry, though officials have not specifically outlined a final policy regarding Mexican beer imports.
The White House did not respond to Fox News Digital’s request for comment.
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