Free trade goes both ways: Mexico slaps tariffs on United States for denying its trucks access

NAFTA was ratified by the U.S. Congress 17 years ago. Mexican truckers, however, are still not allowed access into the United States, a rather clear breach of the free-trade agreement.


It also unnecessarily raises the cost of products sold in the United States, due to the cumbersome procedures involved in moving Mexican goods over the border and onto U.S. rigs.


Now Mexico has offered a response, according to Bloomberg: Raising tariffs on a range of products, most notably pork and oranges. This marks that Mexico's patience with the U.S. non-compliance is running thin, and the new tariffs, if enacted, will have major consequences for U.S. companies. 


While the issue may be considered a minor one when put in perspective - all in all, NAFTA did succeed in drastically expanding U.S.-Canadian-Mexican trade - it has remained a very sore issue for Mexico, especially given the official justification: Mexican trucks are said to be not as safe as U.S. trucks, which is false. 

The real issue, of course, is jobs: The Democrats are pressured by the Teamsters Union to maintain the ban in order to protect them from competition by a lower-paid and highly competitive trucking fleet. While understandable from the point of view of the Teamsters, this argument does not hold water if seen from the lens of NAFTA: Yes, there will be winners and losers as a consequence of NAFTA, and Mexico certainly has seen its share of both, as has the U.S., but all in all the goal is to stimulate trade and to lower prices on goods and services. 


There are a host of arguments against and in favor of "free-trade" initiatives - the term warrants to be put them in brackets from time to time, as it is somewhat of a euphemism, given that some national sectors, particularly those still receiving subsidies, tend to reap proportionate benefits from the lowering of tariffs - the bottom line remains: If you sign up to a free-trade agreement, you better stick to it. The argument that Mexican truckers are unsafe is simply not true: On the contrary, judging from date from a pilot project, Mexican trucks have far better safety records than U.S. trucks.


For more on the issue, the Web site-blog Mexicotrucker.com offers much information in English from the much-neglected Mexican side. For the Teamsters', here.