Obama's Major Stumble

In the United States, treaties, once passed by the Senate, become the supreme law of the land. NAFTA has been law since 1994, and it is generally agreed that the agreement has been beneficial for all three signatories. Now, it is jeopardy because of an Obama administration policy prohibiting Mexican trucks on US highways that was put into place at the behest of the Teamsters' Union. Mexican semis were supposed to be permitted onto US highways as of 1996, but legitimate safety concerns combined with union lobbying prevented this from occurring. In 2001, after the US lost a NAFTA arbitration, the Bush administration initiated a pilot program that was intended to be a stepping stone for full treaty compliance, but the new budget nixed its funding.

The Mexican government, always sensitive where its massive northern neighbor is concerned, has increased tariffs on 90 US products worth 2.4 billion dollars a year in response. Iowa State University Economist Dermot Hayes has predicted, using a draft list of retaliations, that the tariffs would lead to the loss of 40,909 US jobs in 40 states.

Democratic defenders cite our 453 billion dollar trade with Mexico as a legitimizing factor for this policy. This argument is specious at best. Of course we have a trade deficit! Their country is too poor to purchase en masse the kinds of products Americans specialize in producing, like cars, servers, telecommunications equipment etc. That 400 billion dollars a year doesn't just evaporate. It goes into the hand of Mexican producers, which in turn use it to pay workers and invest in equipment. Eventually, the Mexicans will be able to buy goods from us that will go a long way towards equalizing our balance of payments. The same is true with China and just about every other developing country with which we have a trade deficit.

Another argument put forward is that Mexican trucks are somehow unsafe or dangerous, when in fact, the opposite is true.

Earlier this year, the DOT analyzed the safety record of Mexican carriers in the U.S. from 2003-2006. It looked at the rate in which trucks received an “out-of-service” designation by DOT inspectors targeting companies with the worst records. The out-of-service rate for U.S. trucks was 23.5%, compared to a rate for trucks from Mexico of 21.29%. Mexican short-haul trucks operating in the border zone also had a better record than the U.S. trucks, with an out-of-service rate of 22.5%.

The endless tirades about safety seem very flat without any valid statistics to support them. Here is Sen. Byron Dorgan D-SD, fulminating against Mexican safety regulation or lack thereof.

In addition, the cross-border pilot trucking project was supposed to require that Mexican drivers be fluent in English. The inspector general's office has testified that the way the U.S. government determined whether Mexican drivers understood American road signs, as part of the English fluency test, was to show Mexican truck drivers a highway sign and allow them identify it in Spanish. Administering an English fluency test in Spanish makes no sense whatsoever.

Seems to me, that if a Mexican truck driver can identify an American "stop sign" as instructions to stop his vehicle in his native language, then the safety requirement is fufilled completely, and that all this talk about English fluency in relation to cross-border trucking smacks of labor union nativism. This country is enduring one of the most severe recessions of our time, and an international game of 'beggar thy neighbor' protectionist policies is a real possibility. President Obama should act swiftly to remedy this dispute with our third-largest trading partner before it spirals into a true trade war.

Why aren't we Republicans out in front on this issue? I know Americans usually have little interest in what transpires outside our borders, but this issue is going to have concrete numbers of job losses. We aren't encumbered by an enormous union lobby, and the party can take a strong stand against protectionism relatively freely. If the Republican party intends to offer solutions instead of nay-saying at foregone presidential policies, this is an excellent place to start.