Thursday, September 13, 2007

Truckers trapped.

On January 1, 1994 the North American Free Trade Agreement was signed between Canada, Mexico and the United States.
The agreement is better known by the name of NAFTA.

It’s objective is to promote the free trade between the three countries.

But from the beginning the USA did not permit trucks from Mexico to cross into their country.
As this was in violation of the agreement a NAFTA arbitration panel ruled that the USA was violating the agreement.

Until now Mexican trucks are still not free to deliver or haul goods in the USA.
An amazing situation.

Fortunately the Bush administration has been trying to do something about this.
They developed a pilot program to start soon where during one year Mexican trucks can enter the USA.
However, the Mexican trucks and their drivers will undergo rigorous safety checks, including a 39-point, front-to-back inspection of their trucks and drug testing for the drivers.

Last night in Congress there was a vote on this Bush initiative.
75 Senators were opposed.
23 were in favour.
The Mexican trucks continue to be banned to enter the USA.
The violation of the NAFTA-agreement also.

This is an incredible situation.

"I think it's a very serious matter when two countries come together and agree to do something and then one party doesn't fulfil its obligation." said John H. Hill, head of the Federal Motor Carrier Safety Administration.
“The USA has no credibility calling on other countries to meet their obligations under trade agreements if we refuse to keep our own." said Thomas J. Donahue, president of the U.S. Chamber of Commerce.

The reasons given by the opponents of having Mexican trucks come into the USA is safety.
Mexican trucks are considered not to be safe enough.
Of course this is simply a false excuse.
The real reason, although obviously not publicly stated by the politicians, is protectionism.
Fear of loosing jobs and business.

Last night on an ABC radio talk show a 59-year-old man called in and explained he worked in the Los Angeles harbour.
If Mexican trucks were allowed into the USA, ships would unload in Mexico, where it is cheaper, and Mexican trucks would next deliver the containers in the USA.
Taking away jobs in the Los Angeles harbour and jobs in the trucking industry.

This is exactly the core of the problem.
On the one hand free trade is promoted and looked for.
But there is a restriction.
It must not be to the disadvantage of the USA.

This is a short-term view with negative long-term economic effects.

If Mexican harbours and truckers are cheaper, capitalism dictates that the solution is not protectionism.
The solution is to become more competitive.
Protectionism results in stagnation and eventually economic decline.

The current situation will not change easily.
President Bush has stated that he will veto the blocking of his proposal.
But because of the large majority opposing, this will not work.

Meanwhile the American economy stagnates, its international reputation continues to be damaged, an international agreement continues to be violated, the Mexican Government complains, the bilateral relationship with that country gets more strained and hundreds of Mexicans are blocked of making a decent living.


To learn more about NAFTA, click on:

To learn more about the vote in Congress to block Mexican trucks into the USA, click on:,1,4157828.story?ctrack=1&cset=true


1 comment:

Anonymous said...

Nafta only works when it is in the US's favour. Canada learned that lesson with the soft wood lumber dispute.