Pulling back the curtain

by Russ Roberts on July 7, 2011

in Politics

Every once in a while, a news story comes along that lets you see how the world really works. After NAFTA was passed 17 years ago, one provision was never implemented fully–the ability of Mexican trucking firms to operate in the US. This provision was held up because the Teamsters and others didn’t want the competition. But you can’t say that. So the issue that the Teamsters and others used was safety, presumably because there was some provision in NAFTA that required imports to be safe. Or maybe it was on pure political grounds. At any rate, the US has now supposedly agreed to let the trucks to operate freely though it is still subject to some kind of Congressional approval:

The United States and Mexico on Wednesday signed an agreement aimed at resolving a cross-border trucking dispute. The longstanding disagreement had come to symbolize growing resistance, especially in the US Congress, to free-trade provisions with America’s southern neighbor.

The accord, signed in Mexico City by US and Mexican transportation officials, would end a 15-year-old controversy that on the US side featured fears of unsafe Mexican trucks barreling along US highways, driven by unprofessional Mexican truckers.

On the Mexican side, outrage over the American disregard for a NAFTA provision led to retaliatory tariffs on US goods ranging from pork to consumer care products – which cost the US as much as $2 billion in exports.

The accord was greeted warmly by US trade, farm, and business organizations – but condemned by US trucking organizations, a sign the agreement could face trouble in Congress.

The reporter, Howard LaFranchi, frames it clearly just the way the Teamsters would want it framed. Who wants to let in unsafe trucks? The safety issue is the concern of the United States. But is it? Who is worried about it, really? How unsafe are the trucks and drivers? There is no mention of the self-interest of the US trucking industry. There is no mention of consumers in the US who might prefer the lower prices that usually come with competition.

The reporter is not unusual. Every news story that I have seen treats the safety issue as a legitimate concern without wondering if there is anything to it. Turns out that according to a government study, 41% of inspected trucks crossing into the Mexican border were found to be unsafe. But how was that number collected? What does it really mean?

Ten years ago, I wrote an article trying to find out. It’s still on line at EconLib. There are things I would have said differently were I to write it today. But the bottom line is that the whole issue was weird–the safety problem could have been solved at any time the way it has been solved today–by requiring Mexican trucks to comply with US safety standards. And don’t they have to comply with those standards anyway?

The lesson here is how easy it is to get what you want politically by making the issue one of safety or the children. This is not the precise bootlegger and baptist argument but it’s a variant.


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