D. Dowd Muska


Skip the Bureaucracy -- Keep the Marketplace

July 14, 2011

Canada and Mexico pose a quandary for noninterventionists.

It’s easy to make the case that Washington’s meddling in Europe, the Middle East, and East Asia has had disastrous consequences. Adventurism far from home has wasted countless taxpayer dollars and destroyed millions of American lives.

But when it comes to the folks next door, pursuing a policy of benign neglect -- treating them as if they were as irrelevant as Italy, Israel, or Indonesia -- isn’t an option.

In The North American Idea: A Vision of a Continental Future, American University’s Robert A. Pastor argues that few of us realize how cozy Canada, the U.S., and Mexico have become.

“A cursory reading of the newspapers in the last decade,” Pastor writes, “would lead one to conclude that Iraq or Afghanistan were the most important countries [sic] to U.S. national security, China was its dominant trading partner, and Saudi Arabia was its main source of energy imports. All three propositions are false.”

In 2009, America exported more to Canada than it did to China, Japan, and the United Kingdom combined. (At $129 billion, exports to Mexico secured the #2 slot.) U.S. Energy Information Administration data for 2010 show that Canada and Mexico supplied 32.4 percent of Americans’ demand for petroleum imports -- not far behind OPEC’s total contribution.

A national-security staffer during the Carter presidency, Pastor has long been despised by paleoconservatives. In the 1990s, his nomination to be ambassador to Panama was scuttled by Jesse Helms, due to Pastor’s involvement in the transfer of the Panama Canal. In 2006, kook-right writer Jerome R. Corsi denounced the professor for his “history of viewing U.S. national interests through the lens of an extreme leftist almost anti-American political philosophy.”

Pastor is indeed a liberal. Even worse, he’s a political hack whose book lionizes FDR, bashes George W. Bush, and takes a subtle swipe at Sarah Palin. But it’s difficult to dismiss the voluminous data and ample anecdotes Pastor offers to demonstrate why Canada and Mexico matter to the U.S. much more than is commonly understood.

Take avocados. California growers once fought to keep Mexican competitors out of the market. Ultimately, Mexican avocados were allowed to cross the border -- the value of imports rose from $34.5 million in 1995 to $407.6 million in 2005. Was the domestic industry destroyed? Nope. Cheap avocado imports, Pastor explains, “so enlarged the market in the United States that California producers also expanded production and profits significantly.”

Economic integration is most widespread in automobiles. A quarter of the parts that comprise the Big Three’s vehicles come from abroad, and of those imports, half are from Canada and Mexico. “Today,” Pastor writes, “there are no American, Canadian, or Mexican cars; they are virtually all North American.”

The stats for the greatest free-trade story never told -- i.e., foreign investment in the United States -- should make protectionists squirm. NAFTA haters predicted that the trade pact would drive investment in only one direction: out of the U.S. They were spectacularly wrong. Between 1987 and 2008, Canadian investment in America ballooned to $221.9 billion. For Mexico, the amount rose from nearly nothing to $8 billion.

Unfortunately, after marshalling nearly 150 pages of persuasive arguments that there really is such a place as a North America, Pastor closes his book with a list of lousy policy prescriptions. He does not advocate an EU-style “North American Union,” but supports a “North American Community” founded on “interdependence not dependence; reciprocity not unilateralism; and a negotiating style based on a community of interests not a quid pro quo.” To eliminate Mexico’s “income gap,” economic-development officials will oversee a “North American Investment Fund” (note the acronym, because the author doesn’t), a “plan for North American Infrastructure and Transportation for the year 2020” will be developed, and a regional “carbon tax or cap-and-trade system” imposed. “Trilateral consultation” is the goal, “which over time, could lead to coordination, and perhaps even unified policies.”

You don’t need to be a WorldNetDaily reader to find Pastor’s proposals objectionable. Central planning, “public investments,” and junk science are undesirable within nations, and a supranational entity would amplify their damage.

Red tape at the border is atrocious. Harmonization of transportation and food-safety regulations is needed. And a common external tariff for the NAFTA zone is wise. But progress on these and other issues (immigration, water, electricity, disaster relief) isn’t likely under Pastor’s grand scheme.

Government’s proper role in securing a prosperous, peaceful North America is small. Far more important are consumers, entrepreneurs, investors, and charities.

D. Dowd Muska (www.dowdmuska.com) writes about government, economics, and technology. Follow him on Twitter @dowdmuska.

# # # # #