DAVID GREENE, HOST:
And it kind of feels like an unstoppable force meeting an immovable object. President Trump says he is going to build that wall, and Mexico is going to pay for it. Mexico's president has said no way and that he is pretty insulted. NPR's Carrie Kahn is in Mexico City to talk about this.
Carrie, good morning.
CARRIE KAHN, BYLINE: Good morning.
GREENE: OK. So Enrique Pena Nieto, Mexican president, was supposed to be in Washington next week. This dispute over the wall - trip is now cancelled. Who cancelled it?
KAHN: It was Pena Nieto. But we have to back up a bit in the Twitter war between the two. I don't know how far you want me to go back.
GREENE: (Laughter) You tell me.
KAHN: I'll start with Wednesday. That's when Trump...
GREENE: (Laughter) OK, OK.
KAHN: He signed the executive order that, among other things, authorized the construction of the border wall, then, in an interview, once again insisted Mexico will pay for it. And he added, one way or another.
So here in Mexico, you have to keep in mind that Pena Nieto is under great pressure to stand up to Trump, to be more forceful. But it's just not Pena Nieto's way. He said time and time again that negotiation is better than confrontation. And he went on Twitter after Trump's executive order and once again said Mexico will not pay for it. That was for domestic consumption. But he didn't cancel the trip. He was saying he was just thinking about it. But that apparently didn't sit well with Trump.
And by Thursday morning, he tweeted, if Mexico isn't going to pay for the wall, then it doesn't make sense to come to Washington. And that really left Pena Nieto with no other option than to cancel. So he sent out a tweet to that effect. But then a few hours later, speaking to Republicans, Trump said that both leaders had decided it was best not to meet...
GREENE: (Laughter).
KAHN: ...And that he will go another way in dealing with Mexico.
GREENE: God, what a back and forth.
KAHN: And then later in the day, Trump's spokesman floated that idea of slapping a 20 percent tax on Mexican goods coming into the U.S. And they've walked back that idea a bit. But, you know, this is a radical change in the relationship between Mexico and the U.S. in a dramatically short period of time.
GREENE: Really, this is more than just a Twitter war.
KAHN: Yes.
GREENE: This goes deeper.
KAHN: In just such a short period of time, too, David - it's incredible.
GREENE: Well, what is the larger picture of that relationship? How big a deal is this?
KAHN: Well, it's really hard to overstate this turn of events. This is Mexico the U.S. is feuding with. This is one of its largest trading partners. Five hundred billion dollars of trade a year and millions of jobs in the U.S. depend on that commerce with Mexico. Let alone, it's its neighbor and its partner in security and law enforcement and immigration. I talked to one historian who was comparing this low point in the relationship to back to Calvin Coolidge days, when he was president in the '20s...
GREENE: That far.
KAHN: ...Or even back to the U.S.-Mexican War of the 1840s.
GREENE: Well, what does Pena Nieto do from here if he wants to negotiate with Trump but seems in a really difficult spot right now?
KAHN: He doesn't have a lot of options. People here are really pushing him to stand up and be more forceful. But, you know, if there's an all-out trade war that happens with the U.S., you know, Mexico is definitely at an economic disadvantage. Eighty percent of Mexico's exports head to the U.S. So it really wouldn't fare well in an all-out trade war. We'll have to see what happens.
But it's just not in his DNA to fight with his opponents. He's really into negotiation. So we'll have to - I don't see him fighting back too hard. But it may - what it's going to do is, you know, bolster his political opponents and especially the leftist populist here, Lopez Obrador. So we'll have to see what happens with the president here.
GREENE: OK. NPR's Carrie Kahn reporting from Mexico City.
Carrie, thanks.
KAHN: You're welcome.