The Buzz

The Case for Partnering With Mexico

Mexico has been a punching bag in the United States election campaign this year. Rather than hitting our neighbor with insults and threats, however, we should be cementing partnership with Mexico to strengthen our economy and security. The American public has been fed misleading explanations, factual distortions, and bad solutions. A number of the proposed actions regarding Mexico would harm the United States rather than address the challenges we face in creating good jobs, making our economy more competitive, and enhancing border security.   

U.S. trade with Mexico supports a net 4.9 million American manufacturing and service jobs spread widely across the United States, according to the Woodrow Wilson Center’s Mexico Institute. Those jobs exist because, under NAFTA, Mexico has become the second largest purchaser of U.S. exports in the world, with Canada being the largest. We trade over a million dollars a minute with Mexico, and the breadth of U.S.-Mexican cooperation is unprecedented, covering trade, public security, immigration, energy, the environment, international affairs, and much more.

Presidential candidate Donald Trump has talked about new tariffs and other potential punitive actions against Mexico, but there has not been serious discussion of the potential repercussions for the 4.9 million U.S. job holders, and their family members, supported by sales to Mexico or for the broader cross-border networks in which 57 thousand U.S. companies sell to and buy from Mexico. The Peterson Institute for International Economics projected a potential loss of millions of jobs if Mr. Trump’s threatened actions against Mexico and China were taken. Mexico’s peso has already been buffeted significantly by the campaign rhetoric.

Immigration from Mexico has been another campaign theme, but more Mexicans have been returning home than coming to the United States for years. There are 1.1 million fewer undocumented Mexicans in the United States today than in 2007, according to the Pew Research Center, and Mexico is working with the United States to manage the increasing flow of migrants from Central America. Reducing those immigration flows will require that the United States, Mexico and others work together to address the causes that lead families and unaccompanied children to take the dangerous journey north.

We do need to better secure our borders against illegal flows of drugs, arms, people, and illicit money, as well as against any potential terrorists.  But polls indicate that border residents agree the proposed 2000-mile border wall is not the best way to manage these threats. Rather, we should keep building more effective law enforcement, justice and anti-drug efforts on both sides of the border, including with Mexican counterparts.

Part of the reduction in Mexican migrant flows is because Mexico’s economy now offers more good jobs and higher living standards created as it participates in the North American production platform built under NAFTA.  A number of U.S. candidates have questioned NAFTA and international trade this year. In both parties’ primaries, NAFTA was blamed for job losses and calls for renegotiating the treaty were heard.

Let’s consider briefly NAFTA. As with all trade agreements, there were winners and losers in the United States, Mexico and Canada. Trade between the three countries, however, grew much more rapidly than trade with the rest of the world. Today, our NAFTA partners are our two largest customers. We trade more with them than with all of the European Union combined and 1.9 times what we trade with China. Trade in North America is four times larger than when NAFTA was signed, and trade with Mexico is almost six times as large as it was in 1993. We sell more to Mexico than to all of the BRICS (Brazil, Russia, India, China, and South Africa) combined.  We should ask ourselves why we would endanger the good U.S. jobs behind these sales and if we want to compromise the competitiveness of North America, which has been ranked as the most competitive region in the world?