Trumps fight against Made-in-Mexico could carry price on both sides of border
MONTERREY, Mexico — The glowing metal pulsing at 2,912 degrees Fahrenheit in the DeAcero company’s colossal new steel mill here is recycled from old auto parts, barges and broken-down dishwashers bought from scrap yards here and in Texas.
The company’s metal is shipped back across the border to Missouri, to a plant that produces nails sold at Home Depot and Lowe’s stores across America. The nails compete for shelf space with products pumped out by the world’s dominant steelmaking power, China.
On the campaign trail, Donald Trump blasted the North American Free Trade Agreement as “the worst trade deal ever” and threatened to rip it up. And yet the North American economy is a vast interlocking web of enterprises that would not be easy to unravel.
Mexican manufacturing has enjoyed a boom under NAFTA. At the same time, U.S. farmers ship oceans of grain to Mexico. Countless products, like those nails, result from manufacturing chains that straddle both countries. American companies profit from the trade — Walmart is Mexico’s biggest employer — and that helps to prop up Americans’ 401(k) accounts. American-made parts that are assembled into cars in Mexico and sold back across the border mean fewer jobs in Detroit, but cheaper cars for all Americans.
It’s not a one-sided thing,” said Sam Vale, a McAllen, Tex., businessman who owns and operates a commercial bridge across the Rio Grande. “Is the American public willing to spend 30 to 40 percent more for an automobile just because these guys lost their jobs?”
President-elect Trump’s rejection of NAFTA has placed American manufacturing at a crossroads and caused alarm south of the border.
Trump has warned American companies against moving operations abroad, and some have reversed plans to do so. On Tuesday, Carrier, a manufacturer of air conditioners, promised to keep nearly 1,000 jobs in Indiana that had been intended for Mexico.
If Trump’s anti-free-trade convictions are carried into his presidency, he could unravel the economic and geopolitical consensus that has guided relations in North America for the past quarter-century. Economists and rattled business leaders say the return of tariffs would sledgehammer the border-crossing supply chains that have pushed bilateral trade to more than $500 billion a year, potentially wiping out millions of jobs in both countries.
https://www.washingtonpost.com/world/the_americas/mexicans-believe-a-trump-trade-war-will-backfire--and-they-can-show-why/2016/11/30/103bb28c-a6c8-11e6-ba46-53db57f0e351_story.html?utm_term=.1e2770413706&wpisrc=nl_rainbow&wpmm=1#comments
