LAREDO, Texas – The border region has at least one thing to thank President Trump for – galvanizing elected officials and the business community to speak out in favor of the North American Free Trade Agreement.
This is the view of Alan D. Bersin, global fellow of the Woodrow Wilson Center and former commissioner of U.S. Customs and Border Protection. Bersin gave the keynote address at a luncheon held on day one of the two-day 24th Annual Logistics and Manufacturing Symposium held at Texas A&M International University.
In his remarks, Bersin thanked Laredo Mayor Pete Saenz for doing something he, Bersin, did not do enough of in years past – speak out forcefully in support of NAFTA.
“I was part of a generation that didn’t do it. We actually let the private sector produce this enormous wealth of trade and we didn’t build up the political backing for NAFTA,” Bersin said. “I thank President Trump because in fact he has forced the border to actually form U.S.-Mexico business councils and U.S.-Canadian business councils to defend NAFTA.”
Bersin started his remarks by praising Laredo for its dynamism, pointing out that 14,000 trucks cross its international bridges every day. “Laredo is the heart of the border,” he said.
The future of NAFTA, a free trade agreement between the United States, Mexico and Canada, was the top issue discussed at the symposium, with many attendees anxious over the current round of renegotiations. Canadian and Mexican business leaders were in the audience.
During last year’s presidential campaign, Donald Trump called NAFTA the worst trade deal the United States had ever signed. Soon after becoming president, Trump set in motion renegotiation talks over the 24-year-old agreement.
In his remarks, Bersin said that unlike many of his colleagues in Obama Administration, he was “understanding and tolerant” of some of Trump’s tactics. “I appreciate the fact that he is unpredictable. In geopolitical affairs that is sometimes not a bad thing – if you are prepared to follow up,” Bersin said.
Bersin said he was asked to speak at a business association meeting in Puebla, Mexico, a week after Trump was elected president. He said there was tremendous anxiety in the audience.
“I said, the roots of NAFTA have changed the relationship between Mexico and the United States. It changed the fundamental facts on the ground among Canada, Mexico and the United States.”
The “facts on the ground,” Bersin said were that international trade between the United States and Mexico went from $80 billion a year to just under $600 billion a year. “As Everett Dirksen, a former senator used to say, ‘A billion here, a billion there, soon you are talking real money.’ That is what NAFTA has created.”
Other “facts on the ground,” Bersin said, were all the trucks rolling through Laredo. And how Kansas relies on Mexico buying its corn. And all the dairy farm business Mexico conducts with Idaho. And the wheat and soya beans Nebraska sells to Mexico.
“(In Puebla) I said, there is a lot of rhetoric in political campaigns. It is a contact sport. But the facts on the ground will not be denied,” Bersin said, to applause from the audience. “I am here to tell you that the facts on the ground, the roots that have been sunk during those 24 years between our countries will not be denied. They will not be denied.”
Bersin said what has emerged over the past 24 years in binational areas such as Laredo is “mutual respect, affection, and shared economic interest.” This is what will carry the border region through the hard times going forward, he predicted.
Space and Time
Bersin said he was never hesitant to speak his mind, even when part of the federal government. He said he has also been described as either a visionary or someone who is out of his mind. He said he drives some people crazy with his ideas of improving efficiency at land ports of entry.
“It should not take 17 hours to cross the border. The good news is we have a lot of traffic. The bad news is we have a bottleneck. The bridges are bottlenecks. We cannot handle all of these processes right at the line. We have got to use time and space to actually help us process these things, people and cargo, in much more effective ways,” Bersin argued.
His recommendation was that the processing of cargo crossing international bridges occur 15 miles south and north of the port of entry. He further suggested trucks be given appointments on when they can cross the bridge. Different crossing fees would be charged, depending on the time the trucks cross.
To make his case, Bersin cited an experience he and his family had at Disneyland. In the 1980s, he said, he and his family would wait two hours to ride on the Matterhorn rollercoaster. “We would miss the whole day. We’d get three rides all day.” By the 1990s, Disneyworld had made the Matterhorn rollercoaster a more pleasurable experience by making customers make an appointment. This meant two-hour wait times were avoided.
“Ladies and gentlemen, we have to handle the border the same way. We have to eliminate wait times. We cannot expect the citizens in Guanajuato or Iowa to pay for border infrastructure we keep open for just 12 hours a day. Why don’t we keep the bridges open?” Bersin asked. The reason, he said, is lack of federal funding for CBP officers. He said this could be overcome if a different pricing system was introduced. “We could staff the ports 24/7. We have to start using space and time to support the kind of economy we are building here,” Bersin said.
The Future is North America
Bersin said he liked the title of this year’s symposium: Pathways for Trade – North America ‘The Most Competitive Region in the World.’ He argued that the future is North America.
Bersin defined the boundaries of North America as Colombia in the south, the Arctic in the north, Hawaii in the west and Bermuda, in the east. “Mexico and Colombia are the gateway to South America. As Mexico becomes a higher-level manufacturing center, lower cost manufacturing will move to Central America,” he predicted. “And we are part of the Pacific, we have to take advantage of it.”
Bersin said North America possesses three countries that are committed to the rule of law and are democratic in nature. He said the U.S., Mexico, and Canada have borders that are demilitarized and open to trade. He said this was an “extraordinary phenomenon” that people need to recognize, acknowledge, and cultivate.
“In the last 25 years of NAFTA, Mexico has basically become a middle-class country. Fifty percent of Mexicans are middle class, by any measure, birth rate, death rate, years of education, years of housing, and we in the United States have to recognize that. Mexico is middle class. It is the 13th largest economy in the world,” Bersin said.
“The OECD, a respected European analytical organization, predicts that in one generation Mexico will have a larger economy than Germany. This is an extraordinary fact we should never lose sight of. Mexico is a democracy. It has a more reliable voting system than we do in the United States, with all respect. It has a robust press, as its leadership has discovered.”
Bersin won applause again when he said America is already great.
“We are not in decline, we are great because we change. We are great because we have the resilience to recognize what is going on in Mexico and Canada. The North American Century that is just beginning. A North American leadership with Mexico and with Canada will give us the energy and the dynamism to continue to be the innovative, productive, prosperous society that we are obligated to improve as we hand over to our children.”
Bersin finished his remarks by stating again that Laredo is a leader. He said the city has more in common with El Paso than anything that divides it.
“I have a real belief that the North America that is emerging has to be built here on the border, it has to be made on the border, by showing the cooperation, the innovation, the techniques of efficiency and security. We can build out North America from the borders inside out,” Bersin said.
“That means we have to go to Washington together, not in separate delegations. We have to continue to educate our people about why NAFTA is not a luxury, it is a core way through which our growth will develop. We have to stand together. We have to be together with other areas of the border and with our Canadian and Mexican neighbors. Respecting sovereignty but recognizing we can learn from our Mexican brothers and sisters and Canadian brothers and sisters.”
Bersin received a standing ovation has he said: “Let’s go make it happen.”
Editor’s Note: The above story is the first in a series about the 24th Annual Logistics and Manufacturing Symposium.