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 Editorials | Opinions | September 2007 
After 10 Years of Anticipation, Mexican Trucks Arrive on American Highways
 Ray Perryman - Midland Reporter-Telegram
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 |  | With U.S. exports to our southern neighbor accounting for about $134.17 billion last year and imports from Mexico amounting to $198.26 billion during that time, it is easy to see increasing traffic patterns through Texas. |  | |
It's not like it sneaked up on us.
For more than a decade, we knew it was coming. Now that it's here (maybe), it's the subject of talk practically everywhere. Pundits, politicians and prognosticators are all in on the act, and their opinions represent a deep divide.
Some call it the wave of the future; others claim it's the beginning of the end. So what's going on? What has so many people so worked up?
Well, simply put, America's highways are scheduled to be welcoming new occupants, and they are big rigs from south of the border which are gearing up to haul various kinds of materials throughout the nation. In fact, two Mexican tractor-trailers involved in a pilot program delivered steel construction materials this week to New York and South Carolina and are expected to return home with similar products from Arkansas and Alabama.
This unrestricted access to American roads was initially supposed to start in 1995 as a result of the North American Free Trade Agreement (NAFTA) approved in 1993. Out of concern for the safety conditions of Mexican trucks and the capabilities of their drivers (which led to lawsuits, protests, and environment and security conflicts, as well as lengthy negotiations with Mexican government officials and more than a little politics), the process was delayed.
Instead of free access to U.S. roads and highways as intended in the North American Free Trade Agreement, Mexican trucking operations were confined to a 25-mile wide commercial zone in the border states that had been authorized in 1982.
In recent weeks, Congress passed measures requiring strict adherence by Mexican truckers to U.S. safety standards. As a result, the implementation of the highway access plan was further delayed. When these hurdles were eventually navigated, Mexican trucks were authorized to roll northward (at least briefly).
The ability of Mexico-domiciled trucks to roam was just a pilot program. According to the provisions of this one-year endeavor, no more than 25 Mexican carriers could be granted permission to haul cargo north of the border during the first month. (Seventeen trucking firms were expected to secure access to the U.S. market this month.)
Thereafter, the number of firms granted permission to use U.S. highways was to be limited to 25 per month with a maximum of 100 firms and a total of 1,000 trucks for the first year. Each would have to undergo strict safety inspections and face a public comment period. In return, the Mexican government was to allow up to 100 U.S. trucking companies to travel anywhere in Mexico.
During this pilot period, data pertaining to safety and performance of Mexican carriers would be collected and analyzed. Depending on the results of the information, the borders could eventually be fully opened outside of the commercial zone to any registered Mexico-domiciled carrier.
Although change inevitably brings about concerns regarding alteration of the status quo and in some cases is quite uncomfortable to various entities, the bottom line is that greater efficiency in delivering goods and services provides a catalyst for progress and economic expansion (just as reducing travel time and costs through infrastructure investment spurs measurable growth). Moreover, honoring international commitments avoids retaliation and allows us to fully capture the benefits of free trade.
Having been involved in the development of NAFTA in the early 1990s, I well remember the predictions that indicated the agreement would bankrupt the U.S. and chase millions of jobs outside our borders. While certainly there were adjustments that had to be made by numerous companies, by and large, NAFTA has proven to be extremely positive for our nation and our state (as well as Mexico and Canada).
Since its implementation in June 1994, trade flow between the U.S., Canada and Mexico has experienced substantial growth. Trilateral merchandise trade has doubled, reaching $958 billion in 2006. Texas has particularly benefited from NAFTA; exports to Mexico account for nearly 37 percent of all of the Lone Star State's worldwide shipments.
The dominant mode of moving U.S.-North American freight is trucks, which carried more than 62 percent of the total value last year. According to a recent report by the U.S. Department of Transportation, Laredo was the top port for the value of trade transported by truck to and from Mexico in 2006.
With U.S. exports to our southern neighbor accounting for about $134.17 billion last year and imports from Mexico amounting to $198.26 billion during that time, it is easy to see increasing traffic patterns through Texas.
In the aftermath of a recent mishap, it now appears as we go to press that Congress may suspend and delay the change yet again by cutting its funding from a transportation bill. This would please labor and environmental interests as the elections approach and represents a triumph of politics over economics and common sense. Such posturing seems to be inevitable and even popular in some circles, but it will come with a hefty price for U.S. and (especially) Texas business activity.
Dr. M. Ray Perryman is President and Chief Executive Officer of The Perryman Group (www.perrymangroup.com). He also serves as Institute Distinguished Professor of Economic Theory and Method at the International Institute for Advanced Studies. |
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