NAFTA, as is well known by now, has had "winners" and "losers" on both sides on the border.
Here is an exceptionally noteworthy article by Timothy Wise of Tufts University on the article of U.S. dumping of agricultural products in Mexico, originally published in NACLA Report of the Americas.
Some highlights:
* "Mexican farmers on average lost more than $1 billion per year during the nine-year period of 1997–2005, with more than half the losses suffered by the country’s embattled corn farmers"
* "Without exception, the United States exported {agricultural] products at prices below what it cost to produce them, one of the definitions of dumping under World Trade Organization rules."
* "The losses from U.S. dumping surpass the total value of Mexico’s annual tomato exports to the United States, widely touted as Mexico’s biggest NAFTA success story in agriculture."
I also highly recommend Wise's other excellent works, such as the co-written Rethinking Trade Policy for Development: Lessons From Mexico Under NAFTA, available directly as pdf here, as well as the new study Subsidizing Inequality: Mexican Corn Policy Since NAFTA, available here in English and here in Spanish.
Showing posts with label NAFTA. Show all posts
Showing posts with label NAFTA. Show all posts
Saturday, April 16, 2011
Friday, March 4, 2011
How long can Carlos Pascual remain the U.S. ambassador to Mexico? "Don't help me, compadre"
It's front page news in Milenio and La Jornada, and certainly has its fair share of media attention in the United States as well (Washington Post, Wall Street Journal):
President Felipe Calderón is extremely critical of the U.S. ambassador to Mexico, Carlos Pascual, and is stating it pretty much as directly as he can. Asked directly if he had still confidence in Pascual and could still work with him - Pascual's wikileaked disparaging comments on Mexican security efforts have been particularly galling - Calderón replied: "It's difficult to build and it's easy to lose."
Calderón also said sarcastically, "Don't help me, compadre," a reference to what is regarded as less-than-helpful help from the U.S. embassy and State department.
Despite the notable praise of Calderón and Obama for each other, and the seemingly very tangible result of ending the NAFTA trucking dispute, the Pascual case remains a sore. One anonymous U.S. official noted after the meeting, "We stand by our official... and that was that."
Yet this is surely an untenable situation in the long run: The Mexican government has absolutely no confidence in Pascual and wants him out, while Obama sticks by him.
How long will he last?
President Felipe Calderón is extremely critical of the U.S. ambassador to Mexico, Carlos Pascual, and is stating it pretty much as directly as he can. Asked directly if he had still confidence in Pascual and could still work with him - Pascual's wikileaked disparaging comments on Mexican security efforts have been particularly galling - Calderón replied: "It's difficult to build and it's easy to lose."
Calderón also said sarcastically, "Don't help me, compadre," a reference to what is regarded as less-than-helpful help from the U.S. embassy and State department.
Despite the notable praise of Calderón and Obama for each other, and the seemingly very tangible result of ending the NAFTA trucking dispute, the Pascual case remains a sore. One anonymous U.S. official noted after the meeting, "We stand by our official... and that was that."
Yet this is surely an untenable situation in the long run: The Mexican government has absolutely no confidence in Pascual and wants him out, while Obama sticks by him.
How long will he last?
Highly recommended read on Mexican politics: Weintraub's "Unequal Partners: The United States and Mexico"
A book I've meant to say a few words about for a while: Sidney Weintraub's 2010 "Unequal Partners: The United States and Mexico." It is a short, succinct, and highly readable account of current Mexican politics and economy that I recommend wholeheartedly.
Weintraub is an emeritus professor at the University of Texas, where he first started teaching in 1976, and though he is trained as an economist - he was an early proponent of U.S.-Mexican economic integration since the early 1980s - he is as well a very astute political observer and analyst. Also, it should be added, while the book is published by the rightleaning Center for Strategic and International Studies, this is no ideological tract, but a very well written balanced account of U.S-Mexican relations - and much more.
First on the U.S-Mexican relationship. Weintraub's two guiding hypotheses are as follows:
1) The belief that Mexico approaches the United States with diffidence because of its sense of dependence; and 2) That the U.S. reaction to Mexican proposals, or when the United States submits its own initiatives that affect Mexico, is as the dominant player (p. 6)
These are "tested" throughout the book in the areas of trade, FDI and finance, narcotics, energy, migration, and the border. Significantly, though, he argues that Mexico in the past decade has become much more assertive and insistent, while the U.S. has become less dominant, and uses examples such as Fox's opposition to the Iraq war, the Merida initiative, demanded by Mexico, immigration, and the NAFTA trucking dispute to demonstrate this change. Given the most recent news coming out of Calderón's visit to Washington, where a deal appears to have been made (after Mexico finally slapped expensive yet fully legal sanctions on U.S. products), the argument is interesting.
Yet the book also offers some highly succinct and readable accounts where the focus is often on domestic developments in Mexico:
* An excellent review of Mexican economic history and the ISI model (Weintraub met Raúl Prebisch on a range of occasions)
* A very balanced account on NAFTA: "There is no logic in the argument that Mexican GDP growth faltered because its exports increased – and this is what the ‘blame NAFTA’ arguments amount to" (p. 35) - though he also admit NAFTA was indeed oversold on both sides (he might also emphasized here as well that it was hardly a deal made between two democratic countries - how relevant was that to the outcome?)
* A very good review of Mexico's opening and turn toward Foreign Direct Investment, and the 1994-5 economic crisis, with ensuing bank bailout
* A poignant commentary on the 2009 economic crisis: “unlike the slow economic growth during much of the past thirty-five years, the fault is no primarily Mexico’s.” (p. 59).
* A very balanced and pragmatic view on the drug "war," summed up simply and effectively:
*Great chapter on immigration, exposing the perennial U.S. hypocrisy on this topic:
And so forth. Again, this is written by an economist who is strongly in favor of U.S.-Mexican economic integration and freer trade and more financial flows, but it is a wonderfully balanced work.
Weintraub is an emeritus professor at the University of Texas, where he first started teaching in 1976, and though he is trained as an economist - he was an early proponent of U.S.-Mexican economic integration since the early 1980s - he is as well a very astute political observer and analyst. Also, it should be added, while the book is published by the rightleaning Center for Strategic and International Studies, this is no ideological tract, but a very well written balanced account of U.S-Mexican relations - and much more.
First on the U.S-Mexican relationship. Weintraub's two guiding hypotheses are as follows:
1) The belief that Mexico approaches the United States with diffidence because of its sense of dependence; and 2) That the U.S. reaction to Mexican proposals, or when the United States submits its own initiatives that affect Mexico, is as the dominant player (p. 6)
These are "tested" throughout the book in the areas of trade, FDI and finance, narcotics, energy, migration, and the border. Significantly, though, he argues that Mexico in the past decade has become much more assertive and insistent, while the U.S. has become less dominant, and uses examples such as Fox's opposition to the Iraq war, the Merida initiative, demanded by Mexico, immigration, and the NAFTA trucking dispute to demonstrate this change. Given the most recent news coming out of Calderón's visit to Washington, where a deal appears to have been made (after Mexico finally slapped expensive yet fully legal sanctions on U.S. products), the argument is interesting.
Yet the book also offers some highly succinct and readable accounts where the focus is often on domestic developments in Mexico:
* An excellent review of Mexican economic history and the ISI model (Weintraub met Raúl Prebisch on a range of occasions)
* A very balanced account on NAFTA: "There is no logic in the argument that Mexican GDP growth faltered because its exports increased – and this is what the ‘blame NAFTA’ arguments amount to" (p. 35) - though he also admit NAFTA was indeed oversold on both sides (he might also emphasized here as well that it was hardly a deal made between two democratic countries - how relevant was that to the outcome?)
* A very good review of Mexico's opening and turn toward Foreign Direct Investment, and the 1994-5 economic crisis, with ensuing bank bailout
* A poignant commentary on the 2009 economic crisis: “unlike the slow economic growth during much of the past thirty-five years, the fault is no primarily Mexico’s.” (p. 59).
* A very balanced and pragmatic view on the drug "war," summed up simply and effectively:
"The problems between the two countries will persist as long as drug marketers in Mexico can generate the large income that they receive for supplying an illegal product in great demand in the United States” (p. 76-77)*An excellent chapter on the oil industry, and the absurdity of not allowing any risk contracts: Mexico's current legislation on petroleum is more restrictive than Cuba's! Also, a stark assessment of PEMEX's strengths and weaknesses - though he notably does not favor privatizing the company.
*Great chapter on immigration, exposing the perennial U.S. hypocrisy on this topic:
"The door for entry into the United States was deliberately left half-open: people could cross without papers and have jobs waiting for them; and then the blame for what was taking place could be shifted to the poor Mexican whose intent was to find a better life. It has not been a story that casts glory on the United States” (p. 105)* Rips to shreds the argument that Mexican trucks are dangerous and that allowing them would be bad for the environment - rather, points out the madness of the current situation where three vehicles must now be involved, including hours spent idling at the border.
And so forth. Again, this is written by an economist who is strongly in favor of U.S.-Mexican economic integration and freer trade and more financial flows, but it is a wonderfully balanced work.
Tuesday, August 17, 2010
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.
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.
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