Obama Administration Rules Mexico is Undermining, Circumventing Free Trade Deal
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“Trade Wars” actually aren’t about trade – they are about government trade policy. If peoples are trading freely, there isn’t a “War” – there’s commerce. The “Wars” only happen when governments get involved – placing tariffs, regulations and subsidies in the way of the flow.
It becomes a regulatory arms race. A government imposes another subsidy or tax. So several others in response impose new subsidies and taxes of their own. Lather-rinse-repeat.
Their reforms? Unilateral tear-down of their trade barriers – which sounds good. Except it allowed
The latter has since been exploiting that openness – to apparently cheat the system.
In the case of sugar, the Mexican government owns and runs a large chunk of its industry – a woefully inefficient mess that would have long since gone belly-up bereft its massive subsidizes.
Mexico is now dumping government-money below-cost product on the U.S. - to do to us what Brazil did to the EU.
In May, the Barack Obama Administration officially acknowledged this process abuse.
The U.S. International Trade Commission made a preliminary ruling May 9 that unfair trade practices by the Mexican sugar industry have hurt U.S. sugar producers and American taxpayers who support the nation’s sugar program.
The takeaway from all of this is - we still need to cut as many NAFTA-esque deals with as many nations as possible. Free trade is good because the more open things get - the better things get.
But trade deals only work when everyone does what they say they’ll do. With freedom comes responsibility.
And if you want a more receptive domestic climate for farm policy reform, you need full-on enforcement of these trade deals - which will liberate our ridiculous government-subsidized farm markets.
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Seton Motley is the President of Less Government and he contributes to ARRA News Service. Please feel free to follow him on Twitter / Facebook
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