American Foreign Policy with Mexico:Challenges for the Next President
U.S.-Mexican Trade is Vital to Both Nation’s Economies
With less than a month left before the Presidential election, the economy has come to the forefront as the decisive factor and will likely remain so through election day. Senator Barack Obama is continuing to gain momentum more and more each day. Regardless, however, of whether he or less likely Senator John McCain wins, one outcome is surely to occur. The relationship of the United States and Mexico is going to see increasing friction.
Most American voters despite reasonably sound economic evidence to the contrary believe that illegal immigration is robbing American workers of higher potential incomes, draining American entitlement programs, increasing crime and national security concerns.
Barack Obama in several speeches before La Raza and other groups has repeatedly stated that the United States could work with Mexico to improve the Mexico economy but that to receive any benefit the Mexican government would have to concede to changes demanded by an Obama administration in policies towards Mexican labor including higher wages. Although his campaign early on promised specific details about a “Mexico” policy to date no real specifics beyond his initial statements have been offered.
The Democratic Vice-Presidential candidate, Senator Joe Biden, is a frequent outspoken critic of the corruption in Mexico. During a 2006 Presidential bid he said “Mexico is a country that is an erstwhile democracy where they have the greatest disparity of wealth… It is one of the wealthiest countries in the hemisphere and because of a corrupt system that exists in Mexico, there is the 1 percent of the population at the top, a very small middle class and the rest is abject poverty.” When asked about the importance of the United States-Mexican border as an area of trade he responded “People are driving across that border with tons, tons _ hear me _ tons of everything from byproducts for methamphetamines, to cocaine, to heroine.”
Both Obama and Biden have been lifelong advocates of labor and are heavily supported by organized labor unions such as the AFL-CIO which believes the best way to get higher paying jobs in America and reduce immigration is to force Mexico to pay higher wages. While McCain would probably make changes more slowly in the North American Free Trade Agreement it is highly likely that Obama will take action very early on his administration to force a showdown with Mexico. He would demand immediate changes in Mexican labor with an immediate increase in wages and probably also demand more co-operation with border security which has been a frequent Biden concept.
The question is how will Mexico react? American demands for Mexico to get tough with the drug cartels have always been a dilemma for Mexican government officials. They do not want to be seen as puppets for the United States but at the same time realize that trade with the United States and the money from documented as well as undocumented workers in the United States are keeping Mexico’s economy afloat. Although many Mexicans were initially heartened to see the Mexican military move against the drug cartels, cries of abuse and civilian casualities are making the situation increasing unpopular. Political opposition in Mexico is using the increasingly negative view of the violence of the drug enforcement policy to paint the picture that the Mexican leaders in power are just another puppet government of the United States fomenting war.
As we reported earlier in another story, there is now very sound evidence that Middle Eastern terrorist groups are actively involved in trading weapons for drugs with Mexican drug cartels. Mexico has very poor control of entry into its southern border and really does very little to patrols its coasts or northern border either. Some have said that the only reason Colombian cartel submarine vessels traveling through Mexican waters bringing drugs to the United State were caught recently is because the Mexican drug cartels do not want the competition. An Obama Presidency will have to convince Mexican officials to cooperate with the United States in security measures to monitor the oceans, the sky, and the Mexican southern border.
Mexicans are facing severe shortages of corn because the use of ethanol with gasoline for fuel as caused a dramatic price increase in the world wide price of corn. While McCain opposed this program, Senator Obama was its foremost and outspoken sponsor. Unfortunately a few years ago, the American agriculture industry flooded Mexican markets with cheap corn and made promises for future cheap supplies. That promise along with Mexico’s own failing corn production have resulted in food rationing in many of Mexico’s poorest areas. Again political opposition is pointing to American interference in Mexican policy as the blame.
This year has seen tainted food imports from Mexico and China cause major public health hazards. There is no doubt that tighter regulation of agriculture products including more extensive inspection programs at the border are necessary. However, it must be remembered that American agricultural exports are still greater than imports and actually top the list of exports to Mexico. The bumbling of the Food and Drug Administrations handling of the recent salmonella outbreak has made many Mexicans skeptical of the American claims and allowed political opposition leaders to say that was a politically motivated hoax.
(A side note) There is a lot of politics about “country of origin” regarding produce. Recently I spent some time with a well known broker of fresh produce who does business all across the North American continent. It has become common for some produce originally grown in Mexico to now to go Canada and then come back into the United States because saying it is of Canadian origin can significantly increase its value. Fresh produce is washed, inspected, sorted, and packaged usually well away from where it is grown. Large batches of produce from different origins are commonly mixed and may be repackaged a few times. Because customers demand high quality and consistent features in package of produce this mixing is necessary. To try to enforce some “country of origin” rules on produce would likely increase the price dramatically instead they should just make sure that proper handling and packaging standards are meet at the site of packaging.
Social reformers in Mexico argue that the current agricultural economy is set up to produce agricultural products for export which is hurting Mexican workers. They believe that these corporate farms which pay low wages were set up to provide the United States with cheap produce at the expense of Mexico. They have found allies in the United States Congress, American labor unions, and lately even American farmers. Opposition leaders in Mexico propose breaking up corporate farms into smaller individually owned farms that would sell their products locally in farmers markets which would reduce Mexico’s need for agricultural imports. In a strange paradox, many of the Mexican corporate farms are currently owned at least in part by American corporate farm interests which will see higher prices on their American produced products if Mexican imports are stopped.
For those of us that live and work along the Texas-Mexican border in the Rio Grande Valley what happens between our country and our trading partner Mexico is more than just an passing interest. The most important component of that relationship is free trade. As long as there is free trade we can survive. Long time Valleyites have a saying “When the Mexican economy is bad the Mexicans keep their money over here and when the Mexican economy is good the Mexicans spend their money over here“. Local Congressman, Henry Cuellar, uses a campaign slogan that sums up what we believe our foreign policy should be “We should be building more bridges not fences”.
Tony Magaña grew up in McAllen Texas, attended Texas A&M University, holds a doctorate from Harvard University. The co-founder of Contempo Magazine has participated in Valley business for over 20 years.
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