Trump on right track, there’s a long way to go


(Anderson) Herald Bulletin

You don’t have to tell Anderson and Madison County about the harm wrought by the North American Free Trade Agreement.

Many here associate it with the demise of local automobile parts manufacturing. While the regional industry was already terminally ill by 1994, when NAFTA was enacted, the pact among the United States, Mexico and Canada sounded the final death knell of local auto parts plants.

At one time, Delco Remy and Guide Lamp had employed as many as 25,000 people in Anderson. White collar workers made a fortune, and assembly line employees earned a good living and enjoyed generous benefit packages. But global economic forces, the rise of nimble rivals, lack of corporate vision and the dysfunctional relationship between GM management and unions finally made the local factories obsolete. NAFTA further exposed these flaws and sent more jobs that had been ours to Mexico, where non-union workers were willing to do the job for a relative pittance.

Now, President Donald Trump, trying to follow through on a campaign promise, has negotiated a deal with Mexico. The prospective settlement could provide incentives for some auto manufacturers to move some production back to the United States. The deal stipulates, for example, that as much as 45 percent of duty-free auto parts be produced by workers earning at least $16 an hour.

Despite the president’s proclamation that a new deal had been finalized, it has a long way to go. Congress would have to approve it and might be unlikely to do so unless Canada comes along for the ride.

Without the Canadians, the deal could actually harm American workers and consumers by driving car prices higher. The network of automobile makers, parts suppliers and distributors has complex interconnections across North America. Canada is our second largest trade partner, meaning what’s bad for our neighbors to the north is usually bad for us.

A revised trade agreement with Mexico is at least a step closer now, and that’s a good thing. After nearly a quarter of a century, NAFTA is long overdue for an update.

But there’s much work to be done to strike a comprehensive deal that assures benefits for all three countries while protecting Hoosier markets from economic calamity.

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