Commentary

Continued Truck Ban a Roadblock to Trade

By Daniel Griswold
This article appeared in the Daily Deal on August 23, 2001.

The North American Free Trade Agreement was supposed to open the U.S.-Mexican border to trucking. But the Clinton administration, under political pressure from the Teamsters union, refused, citing safety concerns. In February, a Nafta arbitration panel ruled unanimously that the U.S. was in violation of its commitments, and the new Bush administration rightly agreed to open the border to Mexican trucks by the end of this year. But again under union pressure, the U.S. House voted this summer to deny funds to implement the trucking agreement. Opponents of Mexican trucks cite safety concerns. But the U.S. government remains free under Nafta to impose the same or even stricter standards on Mexican trucks on U.S. roads as it does on American-owned trucks. Mexican trucks were allowed full access to U.S. roads up until the 1980s, when the U.S. market was closed in retaliation for Mexico’s ban on U.S.-owned trucks. Mexican-owned tour buses and trucks making deliveries to Canada are already allowed into the U.S. Safety has simply not been an issue. The ban on cross-border trucking imposes a real cost on both countries. Shipment by truck accounts for 86% of the flow of goods across the U.S.-Mexican border. It is terribly inefficient to require offloading and reloading of all those goods at the border, wasting time and manpower that could better be spent elsewhere. Slower delivery times disrupt business planning and drive up costs for producers and consumers. Border delays only add to local pollution and congestion problems. And as long as the dispute remains unresolved, American trucking companies are denied the ability to compete for deliveries within Mexico, reducing their profits and lowering demand for U.S. truck drivers.

Daniel Griswold is the director of the Center for Trade Policy Studies at the Cato Institute.