Look South: The Real Mexico Story

Earlier this month, Wisconsin Governor Scott Walker spent a week in Mexico. Why Mexico? After all, the border is about 1,500 miles from his home state.

Like 28 other governors, Mr. Walker leads a state in which Mexico is either the number one or two export destination. Last year Wisconsin sent nearly $3 billion in exports south of the border, and in his state alone, 117,000 jobs depend on trade with Mexico.

This is a story repeated across the United States, making Mexico the country’s second-largest export destination, accounting for nearly 16 percent of worldwide sales. Without our Mexico trade, 6 million US jobs would be at risk.

“Trade ties between Wisconsin and Mexico are strong, but we want to make them stronger,” asserted Walker. Strong trade relationships between individual states and Mexico have been facilitated by the North America Free Trade Agreement (NAFTA) — a pact between Canada, Mexico, and the United States that set the rules for trade and investment among the three countries. Signed over two decades ago, it is now a hallmark of US economic policy.

As the United States has had to compete in an increasingly globalized world, and in particular with rising Chinese exports, North American integration has been critical in maintaining the US edge. NAFTA created a regional market of 480 million people that allows for the United States to be a better competitor against countries like China.

Given this positive record, it is disconcerting that the US-Mexico commercial relationship is under attack on the campaign trail. Dangerous proposals, including a 35 percent tariff on Mexican imports, would destroy the countless jobs dependent on a vibrant relationship with Mexico. Although this may just be campaign rhetoric, Mr. Trump’s proposals are already damaging the strong trust and sense of partnership developed over many years with our Mexican colleagues.

What is missing is a real, thoughtful discussion on how technology and globalization (which will happen even without any more trade agreements) are changing the labor market and how to adequately prepare workers for the new economy. This is the real discussion that needs to occur, not scapegoating an important ally.

Amid these dangerous messages, Gov. Walker’s visit serves as a critical reminder of the importance of our North American partnerships, especially with our southern neighbor. Our relationship with Mexico has gone greatly underappreciated, and it is time to recognize – publicly – what our closest friendship means for our economy, culture, and national security.

Our economic ties have evolved drastically over time. As the Mexican economy has grown to become the 15th largest in the world, on the back of solid macroeconomic policy and enormous foreign direct investment, it has been successfully incorporated into many US industries. Of these, automotive and electronic equipment have been remarkably successful; parts for goods in these industries are likely to cross the Rio Grande multiple times before the final product is put on the market.

Mexican businesses have even become a source of investment in the United States. In fact, Gov. Walker described the goals of his visit to be: “two-fold, we want to attract new investment from Mexico into Wisconsin, while also encouraging Mexican companies with a presence in Wisconsin to maintain or expand their investments in the state.” The time when the United States was the only economic power in North America is long gone, though politicians may not want to admit it. As the governor’s remarks show, we are becoming increasingly dependent on Mexico not for labor, but for capital and private investment.

For many reasons, we must also celebrate and encourage Mexico’s economic and social well-being. Almost 2,000 miles of shared border and a large influence in Latin America makes the country one of our most critical national security allies. The amount of cultural influence in both directions has inextricably linked our two countries’ histories.

With so much at stake in our strongest friendship, we cannot continue to take it for granted. And in the face of hurtful public discourse, we must be more vocal in defending this vital connection, which, so far, shows no signs of wavering.

*Jason Marczak is Director of the Latin America Economic Growth Initiative at the Atlantic Council’s Adrienne Arsht Latin America Center, which recently launched its #WhyMexico initiative with the aim of depoliticizing the US-Mexico relationship. He is on Twitter @JMarczak.

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