How the Death of NAFTA Could Be a Geopolitical Disaster for America
A NAFTA collapse will create in American foreign policy a weak point newly susceptible to exploitation.
In April 2005, Vladimir Putin famously described the breakup of the Soviet Union both as “the greatest geopolitical catastrophe of the century” and a “tragedy” for Russia. For Americans of this century a catastrophe of even greater proportions is in the making: an end to America’s unique status as the only major power with calm borders. No other large power, anywhere, enjoys or has enjoyed that luxury. In Europe, France, Germany, Russia, Britain and the others have all lived with hostile states on their borders, sometimes erupting into open conflict. Likewise in present-day South Asia, where the mutual hostility of India and Pakistan is well known, and is added to by India’s growing rivalry with bordering China. And of course in East Asia, where the long-standing and deep hostility between China and Japan is just one of the many instances of worrisome borders that those two face. For Japan, its northern border with Russia has long been a contentious issue that continues today, and China has more than a dozen borders, including several that in recent years have led to armed conflict.
The experience of the United States has been starkly different. Located in the center of the North American continent, with oceans on both sides, the United States has conveyed both an image and a reality much to be envied. With a thinly populated Canada to the north and an often struggling Mexican economy to the south, America’s combination of continent-wide size, large population and a vibrant economy has meant borders with few or no worries. That has added enormously to its geopolitical strength, and in the context of the “rising power” thesis, which compares the established-power United States with rising-power China, Harvard’s Joseph Nye wrote recently that geography favors the United States because it has neighbors “that are likely to remain friendly.”
Until now. The possible collapse of NAFTA has altered that long-term status of calm borders. No sudden shift is in the offing, but at the same time what the United States has long regarded as a given can no longer be assumed with as much certainty as before. The reason is that both in Mexico and Canada relations with the United States have become much troubled, notably because of a new and official U.S. trade stance toward both neighbors. In that new perspective both Mexico and Canada have little bargaining leverage and Washington can essentially shape the relationship. U.S. Commerce Secretary Wilbur Ross has been most explicit about this. In December he said a NAFTA collapse would be “devastating to the Mexican economy” and a “big time problem for Canada.” That’s true: both are more dependent on the U.S. economy than the reverse, which led Ross to predict that the two would “come to their senses and make a sensible deal.”
Hardly. The five rounds of NAFTA negotiations this past year reflect both a different trade reality and a changed political climate. On trade issues, Canada and Mexico have acted quickly to broaden their ties beyond the United States, specifically to the EU and China, but the clearest consequence is in Mexico’s sharply changed political reality. Mexico will hold general and presidential elections in July, and, for the first time in many decades, an overtly anti-American candidate, López Obrador, is likely to win. A former Mayor of Mexico City, he has run twice before, the second time losing by a very thin margin. Lopez Obrador is well known both as an anti-corruption reformer and a strong critic of the United States, and recent polls show him ahead of rivals by 5 to 20 percent.
His candidacy has been helped by the many weaknesses of Mexico’s present leadership, but two main U.S. ingredients explain his steady surge. One is the tough stance taken in the NAFTA talks by U.S. Trade Representative Lighthizer and Commerce Secretary Ross; the other is the strident criticisms of Mexico and Mexicans often voiced during his presidential campaign by Donald Trump. His characterizations of Mexicans as rapists and drug dealers have revived a latent but long-standing chord of anti-Americanism in Mexico. That sentiment has declined in the years since NAFTA, and the improvements it has helped to bring to Mexico’s economy, but it has deep roots stemming from Mexico’s loss in the 1847–48 war with the United States. That caused Mexico to cede to the United States half its territory, an enormous swath that is now Utah, Nevada, and California, all of New Mexico and parts of Arizona, Colorado and Wyoming. Memories of that loss die hard, as Texas Rep. Henry Cuellar recently reminded a Washington audience, and while few Americans recall much about James K. Polk, the U.S. president at the time, only Donald Trump rivals Polk for disfavor in today’s Mexico.
That is especially unfortunate because Lopez Obrador’s likely victory in July needs to be seen in the context of what a possible NAFTA collapse implies for American foreign- and national-security policy—quite aside from its toll on the American economy. That is not the main focus here, but some figures are worth recalling. In agriculture alone Canada and Mexico account for a third of U.S. farm exports ($18 billion to Mexico and $23 billion to Canada), and leaders in America’s automotive sector regularly warn that a NAFTA collapse would bring havoc to the jobs created by the supply chains they’ve built among the three NAFTA members. Canadian officials add that nine million U.S. jobs depend on trade and investment in Canada, and that more than two-thirds of U.S. states count Canada as their top market. In January, American agricultural, manufacturing and business leaders (including some from Canada and heavily affected U.S. states) brought much of this evidence directly to the president’s personal attention. The result were some signs he had softened his commitment to end NAFTA, but there were likewise reports he might simply delay the withdrawal until after Mexico’s July elections. What had not changed were long-standing public statements from some in his administration that an end to NAFTA was not only acceptable but even desirable, which led banking and financial figures in both Canada and Mexico to conclude that the president’s own views had not changed, and that a NAFTA collapse had to be assumed.
That outcome will certainly bring much new economic and labor turmoil In Mexico, and if combined with a new Mexican president already critical of the United States, the bilateral relationship is likely to be more troubled than at any time in recent decades. It will come against the background of almost two centuries of calm borders that have long been regarded by the United States as a near-permanent condition. In that light, any change in that border status will be seen as a very attractive target of opportunity by America’s adversaries, among them Russian president Vladimir Putin. Just as he described the Soviet collapse as “the greatest geopolitical catastrophe of the century” he is certain to regard a suddenly troubled U.S. southern border as a same category gift to Moscow. The core reason stems from the Russian leadership’s knowledge that in its competitive relationship with the United States, in no category other than the military is Russia commensurate with the United States. The result is that a basic tenet of Russian foreign policy, as in Soviet times, has been to diminish and minimize every manifestation of U.S. power and influence—to “cut America down to size.”
In earlier years that goal was reflected in Soviet efforts that aimed to highlight and exploit flaws and wounds in American society and politics, most prominently by emphasizing Jim Crow laws and the plight of America’s black population. In today’s changed and different circumstances, Moscow’s focus is on weakening Americans’ support for their political system; to promote for example the view that America’s elections are “rigged.” The common and central element in this approach has been for Russia to assert moral equivalence with the United States: specifically to make the point that American and Western values and practices are no better than Russia’s. Among Russians who deal with Westerners that is a common tactic, as JFK found to his dismay in his first meeting with Krhruschev. Putin himself demonstrated precisely the same method in 2013, when a British reporter asked him how he felt about Stalin and his crimes. As Nikita Petrov recently reported in Foreign Affairs, “Putin shot back: ‘Was Cromwell any better?’”
That practiced response reflects a familiarity with American and Western history that is useful well beyond Russian debate tactics. It reflects an awareness that in the context of a U.S.-Mexico relationship already roiled by trade and border issues, a NAFTA collapse will create in American foreign policy a weak point newly susceptible to exploitation. That new vulnerability will represent a change in status: from a southern border previously calm over many decades to one that would require, at a minimum, a diversion and reallocation of American national security resources, and more if relations worsened.
Of course America’s northern border with Canada has not been troubled nearly to the same extent as in the south, and there is a much different and more favorable history. But the NAFTA issue has genuinely roiled U.S.-Canada relations more than at any time in recent years, and in a recent case Canada chose a policy justified mainly by the need to avoid further worsening relations with Washington. That came in December, when the UN General Assembly famously voted 128 to 9 to criticize Washington’s decision to recognize Jerusalem as Israel’s capital. Very surprisingly, Canada did not join the 128 to 9 majority—including most of America’s NATO allies—who voted against the United States. Canada instead abstained, and the explanation openly voiced was that with relations already so tense over NAFTA, Prime Minister Trudeau wanted to avoid anything that would further upset President Trump. Even so, Canadian foreign minister Chrystia Freeland appears convinced that the current NAFTA talks will fail, and that Trump will withdraw from the pact. Canada will then accelerate steps to widen its export markets beyond the United States, loosening ties that for the past quarter-century were becoming ever closer.