NAFTA was originally a free trade agreement among Canada, Mexico and the United States, but it soon morphed into a piñata for pandering pundits and politicians. Moved by different fears, each took whacks at it. The first fear was a loss of jobs to Mexico, but as it turned out, NAFTA’s most rapid growth in trade coincided with the largest expansion of jobs in American history. Then, the pundits blamed NAFTA for illegal migration, drugs and violence, and every problem in our relations with Mexico and Canada.
Of course, NAFTA did not address these issues, which are part of a new transnational agenda in which all three countries have a choice of blaming each other or devising a new mode of cooperation. So far, they are still in the NAFTA-blaming game. The time has come to end the debate on NAFTA and begin one on the future of North America. If we fail to grasp this, our chronic problems will grow worse, and our potential as a region competing against China will never be utilized.
Since 2001, the growth in U.S. trade with our two neighbors has declined by two-thirds, and yet it still surpassed $1 trillion, making Canada and Mexico our two most important markets. In 2010, we exported four times more to our neighbors than to China, and we imported more energy from Canada and Mexico than from any other two nations.
So while our neighbors depend on us, we also depend on them.
The “North American Idea” is based on a simple premise. When one nation has a problem, its neighbors are also hurt. We felt this when Mexico had a currency crisis in 1994, and Mexico and Canada felt it when our economy plummeted in 2007. But the opposite also applies: When Canada and Mexico emerged from the economic crisis faster than we did, in 2010, they purchased $80 billion more in U.S. goods than the year before.
We can expand our trade fastest with our neighbors, and it benefits us more because the three North American countries make products together, meaning that a much higher percentage of our imports are composed of American exports.
Our agenda is much wider than trade and the economy. If we can absorb a “North American idea” into our consciousness, many new policies are possible. Our economies could be much more efficient if we eliminate costly “rules of origin.” We should work with Mexicans and Canadians to have only one set of forms to cross borders and expand access for frequent and trusted travelers. And if we viewed our neighbors as partners rather than the problem, we could forge common approaches on immigration, energy and drugs.
North America’s share of the world gross product soared from 29 percent in 1994 to 36 percent in 2001. Since then, it has declined to where it was in 1994. Together, the three governments could recover our past success and spread the increasing benefits to those in our countries that have been left behind. It all starts with a North American idea – a healthy respect for our neighbors and a determination to create a formidable regional community.
Robert A. Pastor is a professor at American University and author of “The North American Idea: A Vision of a Continental Future.”