The Christian Science Monitor, 11/26/2013
by Christohper Wilson
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Five years ago, the United States and China launched the Strategic and Economic Dialogue, a reflection of the growing complexity and enormous importance of US-China relations. Earlier this year at their meeting in Mexico City, President Obama and President Peña Nieto agreed to a similar initiative, the US-Mexico High Level Economic Dialogue (HLED), for much the same reasons, and Vice President Biden is in Mexico today to officially launch the initiative.
Before looking at the content of the Dialogue, let’s take a quick look at why this matters:
Mexico is the United States’ second largest export market (Canada is first), and since 2009, exports to Mexico have grown faster than exports to any of our other top trading partners. Some six million US jobs depend on trade with Mexico. Investment and financial flows between the two countries are also important, but the massive trade relationship is still the centerpiece of the economic relationship.
Are American workers are about to experience unwelcome new competition for their jobs? The bill moving through Congress to overhaul the nation’s immigration laws, if approved, would give employers access to expanded visa programs that would admit hundreds of thousands of immigrant workers, of both low and high skills, to toil in workplaces from strawberry fields to technology companies.
The legislation also offers legal status to millions of immigrants working illegally across the country, and ultimately a shot at citizenship. The change would encourage many to roam freely throughout the economy, leaving dead-end jobs in immigrant-heavy sectors of the labor market to seek higher pay elsewhere. But by many accounts, most American workers need not worry about the prospect of hordes of workers entering the country with an eye on their jobs. Rather, immigration is seen as more likely to leave American workers better off.
Mexico outsourcing jobs to America? No, it’s not a headline from The Onion, it’s really happening. Mexican baking company Groupo Bimbo’s Mexico City factory was completely overwhelmed by American appetites for its tasty treats, especially among the fast-growing Hispanic population, who are hungry for the taste of home. But instead of opening another Mexico-based kitchen, it headed across the border to set up shop. So far the baked goods behemoth has opened 80 plants in the U.S., hiring around 40,000 American workers to make everything from Bimbo Panque con Nuez (Pecan Pound Cake) to Barcel Takis Guacamole. So much for those authentic Mexican-made guacamole-flavored tortilla chips — these snacks are made in America.
Secretary of State John F. Kerry and his Mexican counterpart touted the growing economic connection between Mexico and the U.S. on Friday, with Mr. Kerry saying that while the security relationship between the two nations remains vital, economic ties are ultimately more important.
“We don’t want to define this relationship with Mexico or with other countries in the context of security or … counternarcotics traffic,” Mr. Kerry told reporters at Foggy Bottom after meeting with Mexican Foreign Secretary Jose Antonio Meade. “We want to define it much larger in the context of our citizens’ economic needs and our capacity to do more on the economic frontier.”
Only one Latin American or Caribbean country was mentioned in last night’s State of the Union, and it was a negative mention. “Ford is bringing jobs back from Mexico.” It’s true that in 2011 and 2012 Ford added about 2,000 jobs in Michigan and Ohio manufacturing vehicles like the Ford Fusion that were previously manufactured in Mexico. However, Ford has expanded its operations in Mexico too.
Mexico’s auto manufacturing and auto parts industries are doing very well. Having an auto manufacturing industry that can so easily move vehicles and parts across North America’s borders has helped create multi-national supply chains that have benefited citizens in the US, Canada and Mexico. I understand and support President Obama’s push to improve manufacturing in the US. We should be investing in modern manufacturing hubs, research and development. But he was wrong to frame it as a US vs Mexico issue.
The New York Times, Economix blog, 10/19/2012
Of all the economic dynamics buffeting the American middle class, immigration might seem the easiest to explain: as millions of poor immigrants from Latin America poured illegally into the country seeking work, the conventional wisdom goes, they competed with more expensive American workers, displacing them from their jobs and undercutting their wages.
This understanding of immigration helped propel a vast increase in the Border Patrol’s budget over the last two decades to stop immigrants on their way in. It was the rationale for proposals to build a long, tall fence along the southern border. President Obama, who in 2008 said he would push for a law that would grant many of these immigrants legal access to jobs in the United States, instead deported a record number of immigrants working here illegally.
But this explanation of the impact of immigration is mostly wrong.