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Out with the old, in with... Nothing!
The advent of 2008 saw the end of an era of government interference with the free market on trade and commerce: the last agricultural tariffs between Mexico, Canada, and the United States were ended when the clock struck midnight and the book was closed on 2007.
NAFTA, the North American Free Trade Agreement, means many things to many people. It has been blamed for everything from US job losses to the very end of US sovereignty. The facts, however, show that it has been a boon for the US economy as it has increased the market for American goods and services in Canada and Mexico, increased choices for American consumers, and decreased prices for American families. It has also decreased the intrusiveness of the American government on the free market.
Since the implementation of NAFTA and the gradual phaseout of agricultural tariffs, American farm exports have increased by $7.3 billion. Yes, imports have increased as well, by $6.7 billion. Both numbers represent positives for American consumers, as the purchased imports mean that consumers exercised individual choice in the marketplace. Overall, trade between the US, Canada, and Mexico since the implementation of NAFTA has increased from $297 billion in 1993 to $883 billion in 2006.
Of course not everyone wins with economic growth, technological progress, and removal of barriers to trade; the rise of the automobile resulted in the dramatic death of the market for horseshoes and wagon wheel makers, and the removal of government-imposed trade barriers has removed the taxpayer-funded protection of various domestic producers. An article in the Houston Chronicle detailed the decline of Texas-based winter vegetable farmers. However, to those that would decry these small-by-comparison downsides, the question should be: if a business can't compete without government assistance, then shouldn't it be allowed to fail? If we can get less expensive winter vegetables from Mexico, we have more money to spend on other products and services, and overall efficiency of the economy increases. Certainly increased government interference is not the best path to a more efficient, prosperous, robust economy.
As the election year continues, we continue to hear attacks on the free market from both the right and the left, with calls for increased government taxation of imports to "level the playing field" or promote "fair trade". Demagoguery of pending trade deals with Columbia, Peru, and Central American nations is par for the course, with dire threats of economic malaise marking the debate. Lost in the rhetoric, however, is the fact that those same gloom-and-doom scenarios were brought forth during the debate on NAFTA. Tens of millions of jobs and hundreds of billions of dollars in trade later, the conclusion remains: free market capitalism works, and works best when freed from the shackles of government taxation.
NAFTA, the North American Free Trade Agreement, means many things to many people. It has been blamed for everything from US job losses to the very end of US sovereignty. The facts, however, show that it has been a boon for the US economy as it has increased the market for American goods and services in Canada and Mexico, increased choices for American consumers, and decreased prices for American families. It has also decreased the intrusiveness of the American government on the free market.
Since the implementation of NAFTA and the gradual phaseout of agricultural tariffs, American farm exports have increased by $7.3 billion. Yes, imports have increased as well, by $6.7 billion. Both numbers represent positives for American consumers, as the purchased imports mean that consumers exercised individual choice in the marketplace. Overall, trade between the US, Canada, and Mexico since the implementation of NAFTA has increased from $297 billion in 1993 to $883 billion in 2006.
Of course not everyone wins with economic growth, technological progress, and removal of barriers to trade; the rise of the automobile resulted in the dramatic death of the market for horseshoes and wagon wheel makers, and the removal of government-imposed trade barriers has removed the taxpayer-funded protection of various domestic producers. An article in the Houston Chronicle detailed the decline of Texas-based winter vegetable farmers. However, to those that would decry these small-by-comparison downsides, the question should be: if a business can't compete without government assistance, then shouldn't it be allowed to fail? If we can get less expensive winter vegetables from Mexico, we have more money to spend on other products and services, and overall efficiency of the economy increases. Certainly increased government interference is not the best path to a more efficient, prosperous, robust economy.
As the election year continues, we continue to hear attacks on the free market from both the right and the left, with calls for increased government taxation of imports to "level the playing field" or promote "fair trade". Demagoguery of pending trade deals with Columbia, Peru, and Central American nations is par for the course, with dire threats of economic malaise marking the debate. Lost in the rhetoric, however, is the fact that those same gloom-and-doom scenarios were brought forth during the debate on NAFTA. Tens of millions of jobs and hundreds of billions of dollars in trade later, the conclusion remains: free market capitalism works, and works best when freed from the shackles of government taxation.
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