LAREDO, Texas – The mastermind behind the North American Free Trade Agreement was Ronald Reagan, says a former federal congressman and diplomat from Mexico.
Agustín Barrios Gómez spoke in-depth about NAFTA and U.S.-Mexico relations in a keynote speech at the recent Pathways for Trade Symposium held at Texas A&M International University in Laredo.
“The reason there is a North American trade agreement is, curiously enough, not for economic reasons. The reason there is a North American trade agreement is for geopolitical reasons,” Barrios Gómez said.
“We do not value our shared values. We don’t appreciate our shared values enough. This is one of the things Ronald Reagan saw.”
Barrios Gómez is a general partner in International Capital Partners. He earned his master’s degree from the Madrid Law School and co-founded the Mexican Council on Foreign Relations. He is the son of a Mexican ambassador to Canada, was in his last year at Georgetown University when NAFTA was being lobbied for.
“The original idea did not come from George Bush and it did not come from Carlos Salinas de Gortari,” Barrios Gómez said, referring to the former presidents of the United States and Mexico.
“The original idea was from Ronald Reagan. He proposed it to José López Portillo and López Portillo, our president at the time, had this fantastic phrase at the time: ‘Not even the grandchildren of our grandchildren will see that happen’.”
Barrios Gómez said Reagan’s vision of a North American free trade agreement can be read in former British Prime Minister Margaret Thatcher’s memoirs.
“The reason he (Reagan) proposed a free trade agreement with Mexico was he knew that American prosperity and national security directly depend on a stable and cooperative Mexico. Without a stable and cooperative Mexico there is no American superpower. There is no peace,” Barrios Gómez said.
“He saw this and he told his friend Margaret Thatcher: we have Mexico and it is so completely outside of everything that we do. We need to get them inside the tent. We need to bring them on board and we need to have a shared prosperity. He said, we need to have Mexico with us.”
Barrios Gómez noted that while Reagan proposed a North American agreement, it was several years before it was taken up.
“The reason he did that was because he knew that it was directly in line with American national interest. In fact, not just in line, it was crucial for American national interests. There are any number of scenarios in the Pentagon that show how dangerous it would be to have Mexico either uncooperative or to formally become a failed state,” Barrios Gómez said.
Barrios Gómez pointed out that Mexico has an economy four times the size of Iran’s and about 75 percent the size of Russia’s.
“Mexico, if it is not dealt with properly, could actually become a serious issue in North America, instead of being a partner. Even when you think of the military might of the United States, there is only so much that military might can actually do. What are you going to do, invade Mexico? You have got 130 million refugees.”
How the argument for NAFTA was won
Barrios Gómez said he remembers what Mexico did to get NAFTA passed. “I was in the thick of it, it was a bipartisan effort, it was an effort that was picked up seriously on our (Mexican) end.”
Barrios Gómez said President Salinas de Gortari made calls to people like Jack Welch, then head of General Electric and asked them to raise $15 million for a lobbying effort. That would be the equivalent of about $40 million today. Salinas de Gortari also set up a new office to coordinate the efforts – SECOFI, which has since morphed into the Secretaría de Economía.
“They created this office, this dream team of people up there (Washington, D.C.), friends of mine today, people who are on working groups with us in the Mexican Council on Foreign Relations,” Barrios Gómez said.
Barrios Gómez said the instructions from the Mexican president were clear. “You are going to coordinate with them and you are also going to coordinate with the U.S. chambers of commerce and their three million affiliates and you are going to take it to the heartland, you are going to take that message about NAFTA to the heartland,” Barrios Gómez said.
Barrios Gómez takes issue with the notion that support for NAFTA was developed through smoke-filled backrooms and that a key component for its ratification was the hard lobbying of members of Congress.
“Especially in Mexico, we love this idea that the decisions are made in smoke-filled backrooms. It is not true. I guess there is an element of truth but not really. I have been there enough, in both Mexico City and Washington, D.C., to know that that is not true,” Barrios Gómez said.
“Everybody thinks the most important thing that took place in 1993 was the lobbying effort to the members of the House of Representatives and the senators. I am here to tell you that is not true. I was there. I was at the CSIS (Center for Strategic & International Studies) and we did a NAFTA summit on the Hill. We brought all of these experts from around the country, people who were in business, people who were in academia, people who were for NAFTA and people who were against NAFTA.”
Barrios Gómez pointed out that when efforts to create a North American free trade agreement started, public opinion was against the idea.
“When that effort began, 30 percent of the American population was for NAFTA and 70 percent was against NAFTA. These are real numbers. At the end of the effort, after about a year and a half, working together with the American business community, nationwide, those numbers had flipped – 70 percent were for, 30 percent were against,” Barrios Gómez said.
“So, you can talk about the lobbying effort but that was not what was important. What was important was that those representatives knew that NAFTA was actually popular when they passed it. That is why it passed with such a big margin. So forget all of those silly things that everybody is telling you about, these so-called elites and these backrooms and these decisions made in smoke-filled rooms.”
How NAFTA Was Saved
Barrios Gómez said today’s equivalent of the 1993 supporters of NAFTA were in the audience. His remarks were made at the offices of IBC Bank, a strong supporter of NAFTA and its proposed successor, USMCA. The bank co-sponsored the Pathways for Trade Symposium.
“It is people like you who make the difference,” Barrios Gómez said to those in the audience. “Unfortunately, right now, for some strange reason, we don’t believe it, we don’t believe in ourselves. We don’t believe we have the ability to make our case.”
As it related to NAFTA, Barrios Gómez was clearly saddened by how the 2016 presidential election played out.
“To have watched the 2016 election campaign, to see NAFTA dragged through the mud and to witness that nobody was there to say, excuse me, nobody was there to call bullshit, to be frank. Everybody stayed quiet,” Barrios Gómez said.
“Hillary looked like she had an albatross hanging around her neck and the business community was like, well this guy is going to lower taxes so, I guess that is a good thing. Nobody was there to say, we actually believe in NAFTA and we need NAFTA.”
Barrios Gómez then shared an anecdote involving Tom Shannon, the American diplomat who was under secretary of state for political affairs from 2016 to 2018.
“Tom Shannon was actually in the Oval Office when Steve Bannon came in with the letter that President Trump was going to sign to get out of NAFTA. He was telling us how it all went down. Steve Bannon was basically salivating at the idea. He comes in with the letter and President Trump is about to sign it and suddenly a group of people came in, he did not say who, but basically Perdue, the secretary of agriculture. Everybody was called back from wherever they were to come back and defend (NAFTA). They actually created these white boards showing where the people lived who would be affected if NAFTA was obliterated, was cancelled. And that was actually what saved NAFTA.”
Barrios Gómez said it is “terrifying” that NAFTA came so close to being discarded.
“Why did we have to rely on these quarter to midnight tactics to save something that is just so obviously important for so many people; those 12 million jobs in the United States that depend on NAFTA?” Barrios Gómez said.
Barrios Gómez closed his remarks by saying free trade should not be defended for how many jobs it creates but that, rather, it should be considered a basic freedom.
“I would actually argue that we need to defend free trade not on jobs, but on values. I am a Mexican citizen, and I do not believe that my government has the right to tell me what I can or cannot buy with my hard earned money. Nobody protects my job from competition. I don’t see why other areas of the economy should be more special because of that,” Barrios Gómez said.
“I believe that the freedom to trade is a freedom. I think we should defend it as a freedom. I think we have made a mistake in basing our arguments on something as practical or as transactional as jobs.”
Barrios Gómez recalled a statistic given him by the president of the National Association of Manufacturers back in 2016.
“Everybody talks about the U.S. having lost manufacturing. That is just not true. In 1993, the U.S. manufactured half what was being manufactured in 2016. Half. But, it did so with 35 percent more employees. So, 2016, the U.S. was manufacturing twice as much as it was the year before NAFTA was implemented with 65 percent of the employees. That is automation. That is the reality. That is the big news. That has nothing to do with trade.”
Editor’s Note: The main image accompanying the above feature shows Agustín Barrios Gómez speaking at the Pathways For Trade Symposium held at Texas A&M International University on Sept. 10, 2019. (Photo: RGG/Steve Taylor)
Editor’s Note: The above feature is the first in a three-part series focusing on the analysis of Agustín Barrios Gómez. Part Two, which looks at US-Mexico relations, will appear in our next edition.