Issue link: http://read.uberflip.com/i/9408
One day prior to the anniversary, Murphy, NPC VP and CEO John Keeling and Doug Goudie, Director of International Trade Policy at the National Association of Manufacturers, had something to say about the anniversary. The three organizations are among 140 companies and associations that last year formed the Alliance to Keep U.S. Jobs, a diverse coalition of U.S. manufacturers, companies and agricultural interests united in their desire to save the tens of thousands of American jobs put at risk by the cross-border dispute. CANARY IN A COAL MINE Murphy says that Mexico’s imposed tariffs on 90 U.S. manufacturer and agricultural products have largely shut out $2.4 billion worth of exports. Mexico is the second-largest U.S. export market by a large margin, and the price of the tariff has hit U.S. growers where it hurts. Last September, the U.S. Chamber issued a study that found that the U.S. failure to implement cross-border trucking measures has resulted in $2.2 billion in higher costs for U.S. families and companies, $2.6 billion in lost exports and more than 25,000 lost jobs. The business community cheered President Barack Obama in January when he set the goal in his State of the Union address to double U.S. exports, but so far nothing has come of it. “We’d love to double U.S. exports, not cut them in half, but that’s exactly what’s happening to some U.S. exports to Mexico,” Murphy says. Keeling says that potatoes have been the “canary in a coal mine” on this issue in some ways. “What you see in potatoes is really a microcosm of what you’re going to see in other products as this moves forward,” he says. U.S. potato products inflicted with the tariffs—frozen potatoes—can be easily substituted for Canadian frozen products, because they’ve been exporting identical products. For the past year, Canada’s identical products have been 20 percent cheaper than U.S. products. “The ability of Canadian fries to substitute for U.S. fries going to Mexico was very, very high,” he says. Specifically, he says, from April to December 2009, U.S. exports of frozen processed potatoes to Mexico fell by 50 percent in value and, at that same time, Canadian exports rose by almost an identical amount. And the tariffs have also had an impact on the fresh sector. Potatoes intended for processing and shipment to Mexico this year now have no place to go, thus bombarding the fresh market with even more surplus potatoes. “[It’s] causing a disaster right now for growers in terms of their returns in the fresh market,” he says. Finally, Keeling says that this year, potatoes were shipped from Canada to Mexico. Next year, he says, the potatoes will also be grown, shipped and processed in Canada before being shipped to Mexico. “That means fewer jobs, less fertilizers bought, less inputs are bought, less people are put to work harvesting potatoes in the U.S. We will see in potatoes the loss of the other 50 percent of our market share in the next 10 months if something’s not done.” He emphasizes that delay is costing U.S. jobs at a time when, “for a very little bit of money and some expenditure of political capital, we could create a situation where we’re restoring jobs in the U.S.” WHAT NOW? Department of Transportation Secretary Ray LaHood said on March 4 that, “We’re very near a proposal that we think will meet all the safety concerns.” In response, Murphy says, “That’s great, but we can’t wait and wait and wait. On trade, when we stand still we fall behind.” Hopes remain that an agreement will be imminent, but one of the problems with the delay is that there are a significant number of players in order for changes in regulations to be made. Nevertheless, Murphy says, “It has been a full year now, and the costs are escalating, and we need to get on with it.” The alliance has recently been cheered by several developments. First, the Congressional action expired at the end of last year. However, the dispute continues and the tariffs remain. According to Murphy, the Obama administration has taken no steps to end the dispute. In addition, just days before the one- year anniversary, a bi-partisan group of 56 members of Congress penned a letter to U.S. Trade Representative Ron Kirk and Secretary LaHood, requesting that the U.S.-Mexico cross-border trucking program situation be addressed and resolved, noting the “devastating impact on our local industries and area economies.” It said that, despite promises to find a way forward, members of Congress have seen none of the “principles and parameters of a proposed plan to end the dispute.” Murphy adds, “The business community agrees with these members of Congress that the current situation is unsustainable.” The Alliance to Keep U.S. Jobs hasn’t given up on pressing the Obama administration and Congress to resolve the ongoing dispute. “The Alliance urges the U.S. government to urgently resolve this matter before more U.S. jobs are put in jeopardy,” he says. Visit www.keepusjobs.org. PG www.potatogrower.com 15