August 24, 2017

Living Abroad

With another wave of news updates in the White House, the country seems to have forgotten about the ongoing NAFTA negotiations. Remaining up-to-date on the negotiations is important, but there are reporters more qualified than myself covering it. Instead, I wanted to take a minute to step back and look at the future of trade for the U.S.

This is an important topic. With increasing rhetoric from US officials and civilians about American nationalism, there is fear that U.S. trade will be thrown to the side. As the U.S. considers its role in the globe, other nations have taken advantage of our vacancy. Floyd Gaibler, the U.S. Grains Council Director of Trade Policy & Biotechnology, cited that U.S. grain trade has already declined 7% pre-NAFTA negotiations this year. This demonstrates that U.S. uncertainty and rhetoric alone has caused some trade partners to look elsewhere for trade. I saw this in Mexico where there is an increase in vessels bearing Brazilian corn. Furthermore, the European Union is making strides with a trade agreement between the them and Japan following the Trans-Pacific Partnership fallout.

In an increasingly global economy, it is clear the United States is not the only source of trade anymore. And there is an interesting juxtaposition in the agriculture world to make matters more perilous. The U.S. has seen significant strides in agriculture production due to innovations in research and technology. Driven by the mission to feed the world and with the promise of expanding markets, U.S. farmers have worked hard to push production to its highest levels yet. But all these successes lead to the potential of one huge crash. If the U.S. lost access to or competitiveness in foreign markets, domestic farmers would be left with a gross oversupply of goods. This could lead to defaults on loans, significant debt, and strife for many of our nations hardest workers. U.S. consumption is simply not large enough for world-leading production.

On the other hand, we must acknowledge that some U.S. jobs have suffered due to global trade. Florida fruit and vegetable farmers struggle to compete with Mexican counterparts. The sugar producers in the same state face similar challenges. Certain manufacturing industries have declined. Despite this, the U.S. economy continues to grow. That is not to say that the U.S. government should not look to help and support these people. But we also live in a free market where U.S. consumers are often price sensitive and enjoy the benefits of cheaper goods from free trade.

In a sense, the United States let the cat out of the bag when it comes to FTAs and global trade when we pioneered NAFTA in 1994. Now, many nations have adopted their FTAs modeled after our own. If the U.S. is to withdraw from global trade, we can expect fiercer competition from nations eager to improve their own economic and political standing in the world.

I believe in our nation and our standing in the world. Living abroad helped me realize how amazing our country truly is. It is good to come together and consider our role moving forward. But let’s not take too long nor forget about the consequences of our actions.

 Stephen Enke
 U.S Grains Council
Jaime Balmes No. 8-602 "C" Col.
 Los Morales Polanco Mexico, D.F., Mexico 11510
 Office: 011-52-55-5282-0244

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