President Obama says increasing exports would increase employment. He’s right. Jobs tied to exports of goods or services pay more than average. He also has identified trade agreements with other nations as a way to build exports and has proposed joining the Trans-Pacific Partnership. Once again, he’s right. Trade grows more quickly with nations with which the U.S. has bilateral or multilateral free-trade agreements.
But there is something the president and some members of his political party don’t have right: Once the trade agreements are signed, the U.S. is obligated to live up to its legal commitments. The United States is not doing a good job on that, and in some areas, exports are drying up, not growing.
Among U.S. job losses this year were those at a potato processing plant in Washington state. It shut its doors not because of the slow U.S. economy, but because the plant’s production was traditionally aimed at the Mexican export market. Frozen french fries from the U.S. had been gaining strength in the Mexican market until a year ago. Last May, Mexico ran out of patience and retaliated, imposing $2.4 billion worth of new tariffs on some goods because the U.S. hasn’t lived up to a North American Trade Agreement provision to allow Mexican trucking companies to bring loads across the border into the U.S. for delivery.
For 16 years, the Teamsters union has kept a political stranglehold on some members of Congress to keep even limited Mexican competition out of the United States. The union and its friends on Capitol Hill have used safety as a battle cry, but there is not one scintilla of evidence they can point to.
Under agreements crafted during the Bush administration, any Mexican trucks crossing the border would have to meet U.S. safety regulations. The equipment would be inspected for safety violations, and the drivers would be subject to the same regulations as U.S. drivers while in this country. In fact, during a one-year pilot program, 97 Mexican trucking companies were allowed to deliver goods within the U.S., and the companies compiled a near-spotless safety and operations record.
Despite the facts, the political blackmail continues. Potato growers haven’t been the only ones affected. California grapes now have a 45 percent tariff added to their price at Mexican supermarket checkout stands. Not surprisingly, grape sales are down significantly.
At any time, the Mexican government could legally expand its list and spread the pain well beyond the industries already affected. The pork industry is concerned that its huge market in Mexico could be in jeopardy.
How many jobs do we lose before we quit giving in to the Teamsters?
Contact Stephanie Nall at email@example.com.