You might recall what many politicians considered a ridiculous idea during a debate in the 1992 presidential campaign.
That’s when Republican President George H.W. Bush and Democrat presidential candidate Bill Clinton marginalized third-party candidate Ross Perot for his opposition to NAFTA (the North American Free Trade Agreement).
Two years before it was implemented in 1994, Mr. Perot argued NAFTA would not be a two-way street.
He advocated a reciprocal trade agreement to stop jobs from leaving the U.S. for Mexico and other countries, and the sky-high foreign debt to finance trade deficits.
Though sounding facetious, Mr. Perot accurately predicted NAFTA would create a giant sucking sound.
President Bush and Mr. Clinton foolishly argued American businesses would expand and that domestic jobs would be created.
Mr. Perot was proven to be right. The expanded free trade did not result in the creation of jobs and lessen America’s trade deficits.
The problems exacerbated America’s debt. In 1992, the national debt was $4 trillion.
For each American’s share, the debt is now nearly $70,000 as the national debt continues to escalate every split-second:
As job losses and trade deficits mounted, the only benefit from NAFTA for American companies was bigger stepping stones on their pathways to global commerce.
House Speaker Nancy Pelosi has refused to allow a vote on the newly revised NAFTA – USMCA (the U.S.-Mexico-Canada Agreement).
Mexico, in particular, has benefited greatly. The U.S. has a $78-billion trade deficit with Mexico.
The trade deficit with Canada is much less severe. While America suffers from a trade deficit on goods with Canada, it has a surplus on services.
Furthermore, NAFTA has been a gold mine for Mexico, which led the way for it to get trade deals with Japan, the European Union and other nations.
And American service providers, auto companies and other manufacturers – that establish bases in Mexico – capitalize on duty-free and/or preferred access to all of those other countries. Otherwise, they would not be able to do so.
So, the Trump Administration deserves enthusiastic accolades for negotiating the USMCA.
USMCA opens markets for true free competition. With Canada, for instance, the USMCA helps U.S. farmers by optimizing access for American dairy, eggs and poultry.
For the U.S., the agreement implements intellectual property protections and easier access for technological services.
It increases from 62.5 to 75 percent the North American steel and aluminum content in vehicles to offset the advantages China enjoys from its state-promoted and subsidized practices that only benefit the Asian country.
The USMCA mandates the countries to pay their motor-vehicle labor 40 to 45 percent to be paid $16 per hour. (Admittedly, Canadian autoworkers are already paid a higher rate in benefits and wages.)
So-called free-trade advocates argue such provisions are protectionist. But the Trump Administration maintains it will help reduce the dangerously massive trade deficits and in American job-creation.
It will put a stop to foreign countries manufacturing and assembling products in those other partnering countries for economic advantages and to avoid having to pay U.S. tariffs.
Otherwise, NAFTA only benefits U.S. trade attorneys and bureaucrats, and other nations. The USMCA will level the proverbial playing field for American workers and reduce the massive trade deficits to reduce America’s debt and balance the budget.
From the Coach’s Corner, here are additional public-policy articles:
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Flag Day Irony: Hateful Political Rhetoric Threatens America — A tragic event obliterated an historic day in America – Flag Day on Wednesday, June 14, 2017. It had to do with hateful politics.
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2 Democrat Presidents Provided Lessons for Combating Terrorism — Presidents Franklin Roosevelt and John F. Kennedy, both Democrats, won wide respect for their handling of monster threats to America. Plus, both presidents did not hesitate to identify the enemies, call them out on their lies, and to take decisive action. Why President Obama’s political correctness threatened America’s free-enterprise system.
Obstacles to job creation in America are a result of policy, not of motivation.