Ending NAFTA would harm New Mexico economy

Republican presidential candidate Donald Trump is no fan of free trade. We disagree with him on that and believe that the Trans Pacific Partnership which awaits Congressional action would be good for New Mexico’s hard-hit natural gas producers.

However, Trump recently stated that he’d end NAFTA — the trade agreement with Mexico and Canada — which has been in place for two decades now (NAFTA went into effect in 1994). Ending NAFTA could do great harm to New Mexico’s economy. While trade would still be done, NAFTA greatly contributed to expanded trade between the two nations, including exports to Mexico from New Mexico as seen below.

While a simple chart illustrates overall growth, the reality is that NAFTA has also helped increase the number of New Mexicans working in jobs supported by trade. The following chart is from the Business Roundtable. According to data from that organization, 80% more New Mexicans are now employed in international trade than they were prior to NAFTA.

We at the Rio Grande Foundation consistently work to increase the size of New Mexico’s private sector and decrease its reliance on government at all levels. Jobs created in New Mexico by free trade are good-paying jobs. The Santa Teresa border community is one of the few areas in our state that is performing well. While New Mexico is somewhat late to the party, this boom is largely the result of cross-border trade and NAFTA.

Free trade is at the heart of the free market economy. Abandonment of NAFTA would be a serious problem for New Mexico’s economy.

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7 Replies to “Ending NAFTA would harm New Mexico economy”

  1. Obviously, NAFTA would be replaced by something. We would not end all trade with Mexico and Canada. Until we know what might replace this agreement, I don’t think we can automatically assume it will be bad for New Mexico. It’s also possible that a new trade negotiation could very well hurt NM, but overall be better for the US.

    1. NAFTA is indeed not perfect free trade, but do you really think Trump would do better? His idea is to increase tariffs and reduce trade. That would work both ways.

    1. I’m not really worried about hay exports or imports. Some will find it harder to compete, but trade benefits those who engage in it whether it is across state lines or international lines.

  2. Thank you Betty Russell for sharing THE TRUTH. NAFTA, and all the free trade agreements, have indeed increased exports, OF JOBS. Any wonder why the author didn’t include a graph of Mexican IMPORTS? Because it would show an ASTRONOMICAL increase, MUCH more than exports.

    1. Consumers benefit from free trade. The current economic problems facing the US have nothing to do with NAFTA. Our ever-growing federal bureaucracy is the issue.

  3. Free-trade treaties like NAFTA are a net gain overall, but winners and losers are inevitable. What our government has failed to do is figure out how to minimize the impact of business and job losses. Measures like targeted deregulation of affected industries and block grants to states for job retraining may help the U.S. workforce. So will enforcing trade agreements and prosecuting violations.

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