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Opinion

Freer trade benefits consumers

Monica Granger 
Opinion Columnist

George "Dubya" Bush may leave a legacy despite the bungled war in Iraq and less than stellar performance in education. The Transportation Department announced Friday that a pilot program, in the works for more than a decade, "could begin as soon as April that will allow 100 Mexican trucking companies unfettered access to U.S. roads," the Wall Street Journal reported.

Former President Clinton and trucking industry interests lobbied successfully in 1995 to prevent similar trucking arrangements within the 1993-ratified North American Free Trade Agreement from going into effect. The primary argument then, as now, was that Mexican trucks and drivers are unsafe. However, the pilot program includes various inspections, easily resolving the safety problem. 

Once again, industry protectionists are mobilizing to protect their source of income at the expense of domestic consumers and foreign producers. They should let Bush have his blue-ribbon day -- and American consumers, too.

The Associated Press reported that "U.S. inspectors will inspect every truck and interview drivers to make sure they can read and speak English," and that "Mexican carriers insist their rigs meet U.S. standards. And according to the Transportation Department, 240 federal and 300 state government employees deal with Mexican truck issues."

In addition, "trucks will be required to have insurance and the drivers must meet license requirements," www.Bloomberg.com reported.

Furthermore, the pilot program will not deluge U.S. inspectors beyond capacity since only a limited number of Mexican companies (some of which are merely Mexican divisions of American companies) will be allowed at first. It will also be seen whether the efficiency gains of a streamlined trade process are large enough to justify the cost of hiring additional inspectors, allaying critic's fears of an overburdened bureaucracy. This information will then inform future discussions on making free trade a global standard. 

Jim Hoffa, president of the Teamsters union, stated "There is such political pressure to do things to save money for big corporations." Consumers, however, are the real winners when efficiency gains accrue from lower production costs, lower prices and higher quality products.

Ideally, consumers shape market standards such as truck safety and truck drivers' experience without government coercion through private consumption decisions or even standards-setting organizations such as the Snell Memorial Foundation. Motorcyclists revere Snell's helmet ratings more than the Department of Transportation ratings. Even though the law does not require Snell ratings, which are more stringent than DOT standards, helmet manufacturers proudly seek certifications verifying the quality of their product to consumers. 

This illustrates the nature of government mandates versus privately achieved solutions -- the former establishes minimum requirements that tend to stagnate and stifle the competitive pressure to innovate that defines success in the latter. 

Trucking industries would benefit similarly from privately set standards, but Bush's plan to facilitate freer trucking between Mexico and the U.S. is a good interim measure. 

Mexico is setting up processes to allow 100 American trucking companies unfettered access to Mexican highways in response to America's executive branch decision.

Industry protectionists argue that since "Mexican drivers are paid one-third to 40 percent less than their U.S. counterparts, who make an average of about $40,000 a year," American truckers will be forced out of jobs. 

Protectionists would have you blindly believe that Americans have more rights to jobs than Mexicans. 

The argument is threadbare in an increasingly global economy and is despicable in that it seeks to deprive Mexicans the opportunity to better themselves on their own terms (that is, for a wage over-consumptive Americans deem to be too little) while protecting whiny Americans from the rigors of international competition.

One must hope that the impending lobby efforts will die quickly in the face of demands for freer trade with America's third largest trading partner. Bush may yet scrape through office with a glimmer worth accounting. 

Granger, an economics/political science senior, 
can be reached via dccampus@mail.uh.edu