Back in 1993, President Bill Clinton signed an agreement known as NAFTA, the North American Free Trade Agreement. It created a free (well, less restricted) trade zone between Canada, the United States, and Mexico. This was meant to enhance commerce between the three nations, and open new markets for American suppliers.
NAFTA was not just a slip of paper that said “Free trade! Canada, America, and Mexico ROCK!” It contained many requirements and enforcement mechanisms. One of these requirements called for the creation of a trucking program to enhance the movement of goods across the border between the United States and Mexico.
Did you know the people who drive trucks in the United States have an incredibly powerful labor union? It’s called the International Brotherhood of Teamsters. Do you know what unions hate, more than almost anything else? People who compete with their members for jobs. They are not terribly concerned with the loss of jobs in any other industry.
The Teamsters explained the situation to their Democrat friends in Congress, who really value that friendship, if you know what I mean. They made the not entirely unreasonable point that Mexican trucks might not meet U.S. safety standards, followed by the absolutely ridiculous point that there was no possible way to ensure they could. We already have safety laws for commercial vehicles, and they would not be waived for Mexican trucks. Transportation Secretary Ray LaHood, the man who thinks he can improve automobile safety by installing cell-phone jammers in everyone’s cars, says he is working on the problem. I’m sure he’ll come up with something.
Meanwhile, the 2000 deadline for establishing the truck program came and went. In 2007, a pilot program was established to allow selected Mexican truck companies to operate beyond the 25-mile commercial zone around the border. The Democrats did not like this program, although Ray LaHood’s predecessor, Transportation Secretary Mary Peters, testified in February 2008 that “there have been no safety incidents involving [the Mexican vehicles] to date.” According to a report published by the San Diego Union-Tribune, the Mexican trucks were pulled out of service for safety violations 10 percent of the time, which is less than half the average 23% rate for U.S. trucks. One supposes the limited pool of Mexican trucking companies selected for this program would have put extra effort into complying with its regulations. The Teamsters complained about one company with a poor safety record being allowed into the program, but they apparently cleaned up their act to win American business.
President Obama nevertheless signed a bill that killed the Mexican truck pilot program in 2009. This was good news for the Teamsters… and very bad news for everyone else involved in exporting U.S. goods. Remember those “enforcement mechanisms” in NAFTA? One of them allows Mexico to slap punitive tariffs on American imports, because the United States did not live up to its obligations on cross-border trucking. The Wall Street Journal says the value of these goods exceeds $2.4 billion. These tariffs are killing jobs in both the agricultural and manufacturing sectors… which are evidently much less important than the politically-connected truck driving sector.
The ranking Republican member of the House Ways & Means Committee, Dave Camp (R-MI), along with Trade Subcommittee Ranking Member Kevin Brady (R-TX), have already written to the President twice to urge resolution of the Mexican truck standoff. They released a new statement today, in which Camp says:
“Mexico is the second largest market for U.S. exports and provides U.S. employers with an opportunity to create badly needed jobs here at home. But for nearly two years, American workers and exporters have been needlessly subjected to retaliatory duties because the Administration has failed to resolve the trucking dispute with Mexico. The failure to address these retaliatory duties makes U.S. exports and American workers less competitive and is costing us jobs. Inaction on the Mexican trucking dispute is inexcusable. The Administration has the resources to both ensure the safety of U.S. highways and level the playing field for American workers – it needs to act.”
Brady adds, “This is protectionism that hurts American workers and damages U.S. credibility on trade issues, and the economic damage only grows the longer the White House delays. The Administration must act now, to work with Congress before the end of the year, to resolve this issue.”
Remember that the entire point of the controversial “quantitative easing” program pushed by the Administration is reducing the value of the American dollar, to make export purchases more attractive to foreign buyers. Exports are such an important part of our planned economic recovery that the President is willing to manipulate the value of our currency to enhance them… but he won’t do anything to make the Teamsters mad. The value of their campaign dollars does not fluctuate. If you work in the manufacturing or agricultural industries, you should understand that to Democrats, your job is worth a tiny fraction of a Teamster’s.