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Puerto Vallarta News NetworkEditorials | Opinions 

Now is Not the Time for US to Start Trade War with Mexico

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September 17, 2012

Trade with Mexico has been one of the few bright spots in the US economy. Two-way trade in goods and services surged to $500 billion last year, a 17% increase over 2010. (Photo: Rich Pedroncelli, AP)

San Antonio, Texas - The United States is still recovering from the self-inflicted economic wounds of one unnecessary trade war with Mexico. Now is not the time to start another tiff with the nation's third-largest trading partner and its second-largest export market.

A year ago, the Obama administration restarted a long-delayed test program of a cross-border trucking provision of the North American Free Trade Agreement. The Bush administration started the demonstration program in 2007.

A Democratically controlled Congress, at the behest of the Teamsters Union, killed it in 2009. Mexico then slapped punitive tariffs on 89 categories of U.S. exports with an annual value of $2.4 billion.

With the restart of the program, Mexico lifted the tariffs, a move that Texas A&M University's Center for North American Studies estimated would restore 12,000 U.S. jobs. Put another way, the trade war — and the special-interest politics in the United States that sparked it — cost 12,000 Americans their jobs.

Now tomato growers in Florida have renewed a long-running effort to block Mexican imports. They filed a complaint with the U.S. Department of Commerce, claiming Mexico is dumping produce on the U.S. market. The complaint undermines a bilateral agreement established in 1996 that grants Commerce the authority to set the floor for tomato prices.

The United States and Mexico renewed that agreement in 2002 and 2008. It serves the interests of growers and consumers in both countries and works within the NAFTA framework.

But in an election year, the growers in a battleground state are hopeful that the Obama administration will help them achieve their protectionist goals.

Just as in the case of the trucking provision, Mexico will retaliate if the United States imposes tariffs on its produce industry. Exporters in Texas — who send agricultural products, manufactured goods and commercial services to Mexico — would likely be among the hardest hit. And Texas logistics and distribution centers would be hurt by a restriction of Mexican imports.

Trade with Mexico has been one of the few bright spots in the U.S. economy. Two-way trade in goods and services surged to $500 billion last year, a 17 percent increase over 2010 and 24 percent above pre-recession highs set four years ago. An election year ploy shouldn't be allowed to derail this economic success story.