Colorado Gov. Jared Polis says he's not sure Trump is bluffing on tariffs with Canada, Mexico

Gov. Jared Polis said he initially thought the Trump administration was playing a game of “chicken and bluff" over tariff threats — but now he's not so sure.

If the tariffs, indeed, become reality, Polis said they will be devastating to Colorado and the country.

The "nefarious" thing about tariffs, he said in an interview with CNN Wednesday, is they bring the prices of consumers goods up.

“But it's a lot worse than that. It also means that our manufacturing, which has supply chains and integrates raw materials from Canada, Mexico, and other countries, will likely move overseas if we can't continue the strong hemispheric free trade we have with Mexico and Canada. So, it's pretty darn bad,” he said. 

The White House has framed the president’s tariff policy as part of a larger drug war and not as an attempt to reshape existing trade relationships with U.S. allies.

Chinese officials, the White House said, have failed to stem the flow of precursor chemicals to known cartels, while the Mexican government has “afforded safe havens for the cartels to engage in the manufacturing and transportation of dangerous narcotics, which collectively have led to the overdose deaths of hundreds of thousands of American victims.”

Trump economic advisor Kevin Hassett said Canada is a "major source" of fentanyl. The tariffs, he told ABC News recently, are "part of a negotiation to get Canada and Mexico to stop shipping fentanyl across our borders.”

The administration has also complained about America's trade deficit, which Secretary of Agriculture Brooke Rollins described, while visiting Denver recently, as "devastating to our American farmers and ranchers.”

Polis said the daily uncertainty over tariffs is halting investments in manufacturing.

“Nobody's investing in additional manufacturing capacity because they're waiting to see whether the president is serious about this tariff threat, which a lot of people thought was a bluff at first,” Polis said. “That's why the market, you know, until recently, says, ‘Hey, maybe he's serious about these tariffs.’"

"These would be devastating," Polis said.

Under the previous U.S.-Mexico-Canada Agreement, Colorado’s tariff rate was about 0.12%. Colorado paid $7.4 million in tariffs from Mexico and Canada for about $6.5 billion in imports. The state previously paid more in tariffs for imports from China, about $263 million, when tariffs averaged about 14.5%.

Canada makes up about 30% of Colorado’s imports, according to the Farmers for Free Trade said.

During the CNN interview, Polis said he hopes “this is some game of chicken and bluff, and we're going to have less tariffs at the end of the day."

"But I think the markets and me, and most observers, are getting more skeptical of that as we think, ‘Wait a minute here, this guy actually wants to raise taxes on American consumers and companies,’” the governor said.