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Hamer Times: Mr. President, you can’t achieve 3 percent growth without trade (and other thoughts on the Phoenix rally and our trip to Mexico)

Posted on by Glenn Hamer

MEXICO CITY – A few quick reactions to the president’s visit to Phoenix on Tuesday.

What a contrast. I’m writing this from what has so far been a spectacular bipartisan trade mission to Mexico City with over 20 Arizona legislators and dozens of private sector representatives. We’re meeting with government and business leaders here discussing the Arizona-Mexico relationship. Our delegation is speaking with one voice: We value our relationship with Mexico and we want to work together to find mutually beneficial solutions that will grow our economies and prosperity.

But while we were getting started in Mexico Tuesday night, the president was in Phoenix telling a rally that the U.S. will “end up probably terminating” the North American Free Trade Agreement “at some point.” And, “Personally, I don’t think we can make a deal because we have been so badly taken advantage of.”

Enough already, Mr. President, with the threats and bluster. Maybe follow the example our delegation – led by Rep. Tony Rivero and Rep. Rosana Gabaldón – is setting by instead seeking ways to modernize the agreement and ensure its competitiveness for the next two decades. Threatening the 9 million U.S. jobs that depend on trade with Canada and the 5 million U.S. jobs – nearly 100,000 in Arizona – that depend on trade with Mexico is no way to approach the renegotiation of the world’s most consequential trade agreement.

Glenn’s in Mexico this week with a bipartisan delegation of Arizona legislators. Here he is at the Mexican Senate

You can’t get there from here. The president and Treasury Secretary Steve Mnuchin (one of the bright stars of the administration) say they want 3 percent economic growth, which would blow way past the anemic numbers of the previous administration.

That’s a worthwhile goal and one the Arizona business community supports. But, Mr. President, how in the world do you think you’re going reach that kind of growth rate without trade?

I’ll answer my own question: You won’t.

The president’s instincts are right when it comes to tax reforms and regulatory rollbacks. But when it comes to trade, he is wildly off base. Exiting NAFTA would send our economy into reverse. The only question is how many jobs would be lost. It will be a big-league number.

Cutting off products stamped “Made in the USA” from the rest of the world and driving up prices for U.S. consumers would be an economic own goal. We heard today from Mexico Foreign Minister Luis Videgaray, who reminded us that a North America without NAFTA would result in almost double-digit tariffs on things like apples and dairy products, harming U.S. growers trying to sell to Mexico, as well as U.S. shoppers when prices spike at home due to retaliatory tariffs on inbound fruits and vegetables.

At least act presidential. The president’s trolling of Senators McCain and Flake in his remarks were far from presidential.

Arizona’s representation in the U.S. Senate is the envy of the rest of the country. To have two men of such distinguished character representing our state is one of Arizona’s claims to fame. You won’t meet two individuals who are worthier of the title of United States Senator.

Professor Flake on trade. For anyone interested in understanding the importance of international trade, read the chapter in Sen. Flake’s book on international trade. In a few pages, he explains in a simple and succinct way why the U.S. should be a leader on trade and how it benefits producers and consumers alike.

Sen. Flake writes on page 78:

If America were to abandon multilateral trade agreements, either in fits of pique or in the vague hope of negotiating better bilateral deals, then China and other free-trading nations would rush in to fill the void, leaving America behind and doing lasting harm to our economic position and standing in the world. In an economy that moves at the speed of light, a trade policy made up primarily of nostalgia and tough talk would be devastating to the United States, doing irreparable damage to our wealth and standard of living.

Author Glenn Hamer

About Glenn Hamer

Glenn Hamer is the president and CEO of the Arizona Chamber of Commerce and Industry. View all posts by Glenn Hamer →
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