Opinion

House Democrats should stop holding up trade deal with Mexico and Canada

worker in mexico

By Peter Morici for Market Watch

Democrats and organized labor risk killing tangible improvements in the North American Free Trade Agreement that would benefit ordinary working Americans by insisting that Mexico change its labor laws to comply with the deal prior to U.S. ratification. We have no reason to believe that Mexico City will not uphold its end of the deal.

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NAFTA was implemented in 1994 — long before the digital revolution, the mapping of DNA and biologicals, and Chinese mercantilism so fundamentally threatened North American jobs. Organized labor complains that the agreement continues intellectual property protections that raise drug prices but trilateral trade negotiations are not an appropriate venue for addressing U.S. health care costs — it’s merely an obstructionist tactic.

And Americans have broader—jobs protecting—intellectual property concerns than just drug prices.

NAFTA enabled integrated supply chains across all three countries, permitted the auto and other industries to keep activities on this continent that might have gone to Asia, and helped Mexico avoid the instability that has plagued nations further south.

Detractors point to the $78 billion U.S. trade deficit with Mexico. The facts are that Mexico City used NAFTA to become a springboard for global free trade. It has negotiated deals with the European Union, Japan and more other countries than any government on the planet. Manufacturers and service providers can set up shop in Mexico and take advantage of preferred access to all those markets—they can’t do that from the United States.

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