Mexico Infrastructure Aff/Neg

Possible Plan Texts

Text: The United States federal government should substantially increase its United States – Mexico North American Development Bank border transportation infrastructure investment

Text: The United States federal government should substantially increase its investment in United States – Mexico North American Development Bank transportation infrastructure projects

Text: The United States federal government should substantially increase its border transportation infrastructure projects with Mexico

Test: The United States federal government should substantially increase aid to funding transportation infrastructure around its border with Mexico

***Inherency***

1AC

Current levels of investment non-unique disads but its not sufficientWilson et al 5-13 (Wilson, Christopher (associate at the Mexico Institute), Eric L. Olson, Miguel R. Salazar, Andrew Selee, and Duncan Wood, “New Ideas For a New Era: Policy Options for the Next Stage in U.S.-Mexico Relations,” May 2013, http://www.wilsoncenter.org/sites/default/files/new_ideas_new_era.pdf, AC)

The first step to improving regional competitiveness is freeing up the flow of trade within ¶ the region. As the central architecture of North American economic relations,

NAFTA ¶ has spurred huge growth in regional trade and investment. Unfortunately, even as bilateral trade skyrocketed, the United States and Mexico did not make the infrastructure investments or policy advances needed to efficiently move what now amounts to more than ¶ a billion dollars’ worth of goods back and forth across the U.S.-Mexico border each day. ¶ Since the U.S. and Mexico build products together, materials and parts that are used ¶ as inputs for production often zig-zag back and forth across the border several times as ¶ a product is being made. This means that the bottom line of regional manufacturers is (The extraordinary thing is that this recent ¶

boom in bilateral trade has occurred without a ¶ strategy. Imagine what could be achieved if the ¶ governments of the United States and Mexico ¶ designed and implemented a comprehensive plan ¶ to improve the competitiveness of our region in ¶ the global marketplace) negatively impacted in a magnified way by any inefficiency in moving goods between ¶ the two countries. The section of this report on border management describes the challenges and solutions in greater detail, but, in short, the advances in border security ¶ made after the terrorist attacks of 9/11 came at a price. Long and unpredictable wait ¶

times now chip away at the competitiveness of the region. Thankfully, an innovative ¶ set of border management concepts, endorsed by the presidents of the United States ¶ and

Mexico in the 21st Century Border initiative in 2010, has the potential to simultaneously strengthen security and efficiency. Some important advances on the implementation of those concepts have been achieved, but the lines at the border remain ¶ long and there is much work to do.

Mexico and the US are set to experience growth – the plan is key to ensure competitivenessWilson 5-13 (Christopher Wilson, associate at the Mexico Institute, “A U.S.-Mexico Economic Alliance: Policy Options for a Competitive Region,” Wilson Center, May 2013, http://www.wilsoncenter.org/sites/default/files/new_ideas_new_era.pdf, AC)

At a time when Mexico is poised to experience robust economic growth, a

manufacturing renaissance is underway in North America and bilateral trade is booming,

the United ¶ States and Mexico have an important choice to make: sit back and reap the moderate ¶ and perhaps temporal benefits coming naturally from the evolving global context, or ¶ implement a robust agenda to improve the competitiveness of North America for the ¶ long term. Given that job creation and economic growth in both the United

States and ¶ Mexico are at stake, the choice should be simple, but a limited understanding about

the ¶ magnitude, nature and depth of the U.S.-Mexico economic relationship among the public and many policymakers has made serious action to support regional exporters more ¶ politically divisive than it ought to be. ¶ The United States and Mexico have become profoundly integrated, and the two ¶ countries are

now partners, rather than competitors, in the global economy. The North ¶ American Free Trade Agreement, geographic proximity, and the complementary nature ¶ of the two economies have fostered an integrated manufacturing platform. The United ¶ States and Mexico do not only trade finished products;

they build them together. Indeed, ¶ roughly 40 percent of all content in Mexican exports to the United States originates in ¶ the United States, much more than the comparable figures with China, Brazil, and India, ¶ at four, three, and

two percent respectively. Only Canada, at 25 percent, is similar. As a ¶ result, improvements in productivity in either country, as well as advances that lower the ¶ costs of moving goods

across the border (i.e.: long wait times, inefficient customs procedures), strengthen the competitiveness of manufacturers throughout the whole region.

Ext - Inherence

Squo trade is inefficient – border infrastructure investment is key to revitalize trade Wilson 11 (Christopher E., associate at the Mexico Institute, “Working Together: Economic Ties Between the U.S. and Mexico,” Woodrow Wilson International Center for Scholars, November 2011, http://www.wilsoncenter.org/sites/default/files/Working%20Together%20Full%20Document.pdf, AC)

U.S.-Mexico economic integration boomed in the 1980s and 1990s as ¶ Mexico pursued first a unilateral liberalization of its economy after decades ¶ of protectionism,17 and then a regional strategy culminating in the 1994 ¶ implementation of the North American Free Trade Agreement. While ¶ disagreements remain about specific economic and social effects of the agreement,18 it undoubtedly increased U.S.-Mexico economic integration, with ¶ bilateral trade growing at an annual rate of 17.4% and doubling in

value before ¶ the end of the decade. Since 2000, however, a number of regional and global ¶ factors have slowed the pace of integration, bringing the average annual increase ¶ in trade down to 9.5%. Perhaps most significantly, NAFTA deepened a model ¶ of production sharing and cross-border investment among the three North ¶

American countries, making the economies profoundly interdependent.¶ Outside of North America, the largest challenge to U.S.-Mexico integration ¶ is China. Since joining the World Trade Organization in 2000, China has ¶ surpassed Mexico and Canada to become the United States’ largest source of ¶ imports (but is still well behind the two regional partners as a market for U.S. ¶

exports).19 Cheap labor costs in China drew factories away from both the U.S. ¶ and Mexico. Although production costs often declined, the large ocean separating ¶ North America from China prevented the development of the production sharing ¶ operations that are so prevalent between the United States and Mexico. This is ¶ evidenced by the fact that Mexican imports contain ten times more U.S. content ¶ than their Chinese equivalents. While Chinese imports were displacing Mexican ¶ ones, China, Japan and other Asian countries increased their sale of materials ¶ and parts for Mexican manufacturers. From 2000 to

2006, the U.S. share of Mexico’s imports for processing exports fell from 81% to 51%.20 This means other ¶ countries are supplying more and more of the parts and materials used to make ¶ products that are sold to the United States. ¶ In order to protect the U.S. jobs that depend on supplying Mexican ¶ manufacturers, it is important that businesses and policymakers work to improve ¶ the competitiveness of U.S.-Mexico supply chains. Businesses might also look for ¶ ways to take advantage of Mexico’s 12 free trade agreements with 44 countries to ¶ increase jointly produced exports to the rest of the world.¶ Within the region, another set of challenges has emerged in the new ¶ millennium. The United States, and consequently Mexico, experienced two ¶ recessions that slowed trade and investment while threatening to fuel a return ¶ to protectionism. Differences in regional regulatory frameworks, complicated ¶ rules of origin, and transportation inefficiencies all erode the natural comparative ¶ advantages of the North American region. Key to solving these and other ¶ challenges is an understanding on the part of

policymakers, industry, and labor ¶ that the U.S. relationship with Mexico is not being fully leveraged to maximize ¶ North American competitiveness

vis-à-vis other economic regions such as ¶ Europe or East and Southeast Asia.21¶ Many argue the border has become more difficult and costly to cross as a result ¶ of inadequate infrastructure investment and the increased security measures put ¶ in

place after September 11, 2001. Extended and unpredictable wait times at the ¶ border create a disincentive to bilateral trade and production sharing, disrupting ¶ production chains and disproportionately hurting small and medium sized ¶ businesses. Nearly 80% of trade with Mexico is land trade, meaning it enters or ¶ exits the U.S. through one of the ports of entry along the Southwest border.22¶ The enhanced use of techniques, such as pre-inspection clearance, that facilitate ¶ the secure flow of goods across the border can help lower the costs of trade ¶ and encourage production sharing.23 Recognizing the need to prioritize both ¶ security and the economy, the U.S. and Mexican governments developed the 21st Century Border Initiative to expedite secure, legal traffic by trusted parties and ¶ thereby free up capacity for border security personnel to investigate potentially ¶ dangerous goods and individuals. Strong cooperation at the border allowed the ¶ United States and Mexico to open three new border crossings in 2010, two in ¶ Texas and one in Arizona.¶ There is no doubt that the economies of the United States and Mexico are ¶ facing serious challenges. While much of the risk is due to external pressures, ¶ whether the rise of Asian competition or fears of crisis in Europe,

much of the ¶ solution lies in strengthening regional competitiveness. Efforts to improve border ¶ management, harmonize regional regulation, and simplify

rules of origin are a ¶ good starting point, but improving policy requires surmounting certain political ¶ challenges. The path forward, then, must be based in a clear understanding that ¶

enhanced cooperation with Mexico strengthens the economy of the United ¶ States. The solution begins with a vision of the United States and Mexico as ¶ partners rather than competitors.

Ext. Inherency Competitiveness

Current infrastructure insufficient for current levels of trade – kills competitiveness and economyUribe 2012 [Monica Ortiz Uribe, reporter for Fronteras, a public radio collaboration in the southwest focusing on the border and changing demographics, October 30, 2012, “NAFTA's promise slowed by lack of border infrastructure”. MarketPlace World http://www.marketplace.org/topics/world/naftas-promise-slowed-lack-border-infrastructure]

Every day, more than a billion dollars worth of goods moves across the border between Mexico and the

United States. Trade between the two countries quintupled in the last two decades. The World Trade bridge in Laredo, Texas is the most important commercial crossing along the southern border. About one third of all goods traded between the U.S. and Mexico travel through this port of entry. That equals about 5,000 trucks per day moving everything from cornflakes, to weed eaters, to Volkswagen bugs. "World Trade Bridge was actually opened in April 2000," says Gene Garza, who is in charge field operations in south Texas for U.S. Customs and Border Protection, "prior to that there was no bridge here, there was nothing out here this was just farm land." The bridge is a testament to the

post-NAFTA boom when most tariffs between the United States and Mexico were eliminated. Since NAFTA the number of trucks crossing through Laredo has tripled. But even

before this bridge celebrated its 10th birthday, traffic had already outgrown capacity. Last year border authorities nearly doubled the number of lanes to 15. Still wait times can be inconsistent, which is a problem for manufacturers. Carlo Jose, a Mexican truck driver who's been crossing trucks through this border for seven years, says "sometimes it's difficult sometimes you spend five to six hours to cross the border." A five-hour-plus wait time is worse case scenario. On good days drivers may wait just one hour. If they are accredited under a

Customs and Border Protection trusted traveler program their wait could be less than an hour. The main hold up at the border is security. After the terrorist attacks of September 11, 2001 the inspection process at the border intensified. Every vehicle that crosses through U.S. borders is subject to a thorough screening. That could be an X-ray of both the truck and trailer or a manual inspection where the entire contents of a trailer is unloaded and checked. "We have to facilitate the commercial traffic coming in but we also

have to make sure that our borders are secure," Garza says. Infrastructure at the border also affects wait times. The biggest obstacle to updating the current ports of entry and building new ones is insufficient federal funding. It’s especially tough now when the country is recovering from an economic recession and Congress has

failed to approve the a new budget. Chris Wilson, who researches binational trade for the Woodrow Wilson Center in Washington D.C., says “Customs and Border Protection has identified a $6 billion deficit between where we are now and where we need to be to keep up with all the people and goods that are flowing across the border everyday." There has been some progress. There’s a new commercial port of entry in Arizona and another under

construction in west Texas. Other ports have added additional lanes and trusted

traveler programs have helped speed up inspection times. But it’s not enough. In the past two years binational trade has grown by a record 23 percent. Without the

infrastructure to support that amount of trade both countries lose out. “It cuts into the competitiveness of manufacturing in North America," Wilson says. "It means

that we have less jobs, less trade, less exports and those are things

that are really important right now to our economy.” In an effort to speed things along, some binational business leaders have begun to invest in infrastructure themselves. "The truth of the matter is we cannot afford to wait for the federal government to allocate federal dollars for these important projects,” says Ruben Barrales, president of the San Diego Regional Chamber of Commerce. One example of such a project is a privately funded non-commercial border crossing outside San Diego that's currently under construction. Once completed it will link travelers directly to the Tijuana airport. It’s success may help determine the future of other privately funded commercial projects

currently in the works.

***NAFTA/Trade***

1ACTrade from Mexico is set to skyrocket now, but future trade is hampered by lack of border transportation infrastructure USA Today 5-2-13 (http://www.usatoday.com/story/news/world/2013/05/01/mexico-obama-economy/2126239///JC)

MEXICO CITY — Delivery trucks from Mexico line up early in the morning at the border crossing in Tijuana, where 20 million flat-screen TVs were manufactured last year.Traffic studies found cargo trucks, even empty ones, wait 90 minutes on average to cross into the USA as U.S. Customs agents check vehicles for contraband, and then spend at least an hour waiting to get back into Tijuana.¶ "Trucks that are a critical element of a competitive supply chain may spend three to four hours waiting in line during a day," says Kenn Morris, president of the Crossborder Group, a San Diego consultancy, which commissioned the traffic studies. "These kinds of delays are both too typical and really strangle border economies … and put more barriers between what should be two strong economic partners."¶ Improving on the way goods flow from Mexico to the USA is what President Enrique Peña Nieto intends to emphasize Thursday when President Obama visits Mexico City.¶ The U.S. Justice Department says Mexico's drug lords are establishing greater control over criminal activities in the USA, but Peña Nieto, elected in December, has pushed such security concerns to the side in favor of economic issues.¶ U.S.-Mexican trade has risen as Mexico becomes an increasingly attractive locale for U.S. manufacturers that are seeing the cost to produce goods in China go up. Trade between Mexico and the USA topped $500 billion in 2012.¶ Analysts here say Obama should take up Mexico on its offer since closer economic ties benefit both the U.S. and Mexico, especially now that Mexico is seeking greater access to U.S. suppliers to keep its assembly lines expanding.¶ Mexico's economy grew by less than 2% annually during the six-year administration of former president Felipe Calderón that ended in 2012. But it is forecast to grow by 3.5% in 2013, according to Mexico's government.¶ Shannon O'Neil, analyst at the Council on Foreign Relations and author of the book Two Nations Indivisible, says the challenge for the two countries is "how do you make it so that things cross the border more easily?" ¶ Border crossing takes so long in large part because of inadequate infrastructure and inadequate staffing for the amount of traffic, she says. It also results from significant bureaucracy – duplicate customs forms and other procedures.¶

The capacity of the border entry points to clear trade traffic into the USA has not kept pace with the increase in trade in the border region. In addition, the 9/11 attacks in 2001 prompted added security measures, which slow things down and raise expenses for businesses.

Lack of infrastructure will result in regional trade deterioration – collapses the NAFTA agenda

Peters, 09 – Enrique Dussel, professor at the Graduate School of Economics, Universidad Nacional Autónoma de México (“Manufacturing Competitiveness: Toward a Regional Development Agenda,” The Future of North American Trade Policy: Lessons from NAFTA, Pardee Center, November 2009, http://www.ase.tufts.edu/gdae/Pubs/rp/PardeeNAFTACh2PetersManufNov09.pdf)

One of the Mexican government’s goals in signing NAFTA was to expand its manufacturing sector by stimulating exports. In the early years following implementation, Mexico succeeded in attracting foreign investment and increasing manufacturing exports, with notable expansion in automotive, apparel, and electronics, among others. Yet this apparent

success masks fundamental weaknesses, as the three NAFTA countries together have been losing their ability to compete in manufacturing in the global market. This suggests the need for a more proactive

and long-term regional response. Even before the recent global financial and economic crisis1, the

manufacturing sectors in the NAFTA-region were under similarly extreme pressures. The share of manufacturing in terms of GDP and employment has been falling in the three NAFTA countries, particularly since 2000 (See Figure 1). Contrary to the period 1994–2000, which saw increasing regional integration in a highly

competitive global market, from 2000–2009 (March) the NAFTA region together lost 6.3 million jobs in manufacturing, or 27 percent of total employment in the sector.2 This suggests that in

general, and in particular since 2000, the process of regional integration has deteriorated; in fact, an increasing process of “disintegration” has been taking place since then. These tendencies have only deepened since the second half of 2008 with the global crisis. In recent

years, the original NAFTA integration agenda among the NAFTA countries has given way to one focused on security topics, with little sustained attention to socioeconomic,

infrastructure, and other regional development issues.

Lack of investment in transportation infrastructure is the Achilles heel of NAFTA – the plan is key to prevent collapseMichael C. McClintock (Professor of Law, Gonzaga University School of Law) 2007 “NAFTA'S 13TH YEAR: STEADILY INCREASING TRADE BETWEEN THE UNITED STATES AND MEXICO, TRANSPORTATION INFRASTRUCTURE CRISIS, BUILDING A "DRY CANAL" ACROSS SOUTHERN MEXICO, AND MORE” 14 Sw. J.L. & Trade Am. 25, Lexis

Transportation infrastructure is a significant portion of a nation's wealth so long as efficient freight movement over that system is maintained. 95 In fact, the emergence of highly integrated just-in-time inventory strategies in the United States was made possible by fast, reliable trucking services. 96 But success may have sown the seeds for disaster. As

one report warned,¶ ¶ The increased emphasis on meeting delivery windows and reducing the amount of inventory maintained on site heightens the need for a [*42]

transportation system that provides the reliability, transit time, efficiency, cost and damage

minimization sought. When the transportation system cannot meet these parameters , then the cost to the economic well-being of the country can be tremendous . 97¶ ¶ The result has been that freight volumes have grown dramatically and are expected to increase 70% by 2020. 98 The increasing volumes of NAFTA-trade constitutes one-third of the U.S. worldwide merchandise trade totals. 99 Although "historically the U.S. has been a world leader in freight system design and management, ... in recent years

it has become alarmingly apparent that investment to maintain and improve our aging transportation system has not kept pace with the burgeoning growth in freight flows." 100¶ This author concluded that if "we don't start fixing it, we'll be in big trouble." 101 Simply put, the U.S. transportation

system has not kept pace with the growth in freight transportation and now faces serious overcapacity and congestion issues. 102 These themes are echoed throughout many studies.¶ [*43] ¶ B. Inadequate Capacity¶ ¶ "Clearly, more traffic is moving over essentially the same highway infrastructure." 103 When demand outstrips supply, the result is congestion which can have devastating effects on speed and reliability. 104 Congestion has been described as insidious. "One, you lose productivity because you can't move, and two, you're burning up fuel and using driver hours," one trucking company executive explained. 105 The U.S. General Accounting Office ("GAO") said that in 1999, congestion adversely impacted truck-driver productivity; 106 in 2000, congestion on U.S. highways was bad; 107 in 2003, insufficient and aged infrastructure was a major contributor to freight congestion and bottlenecks; 108 and in 2005, congestion was getting worse. 109 In 2006, the GAO said even more emphatically:¶ ¶ Increasing passenger travel and freight movement have led to growing congestion, and decision makers face the challenge of maintaining the nation's mobility while preventing congestion from overwhelming the transportation system. Successfully addressing mobility needs in the face of growing congestion requires both strategic and intermodal approaches ... . 110¶ ¶ Mike Eskew, CEO of United Parcel Service, recently told business leaders that "the inability of our transportation infrastructure to keep up with the normal day-to-day stresses imposed upon it was shocking." He further warned that America was risking its future by neglecting its infrastructure. 111 One high-profile group has been even blunter:¶ ¶ America's long and successful ride to prosperity is threatened by a transportation infrastructure incapable of meeting future requirements. The interdependent network of roads, bridges,

and terminals is growing increasingly antiquated, congested and disconnected, [*44] and therefore, incapable of providing the productivity and prosperity support upon which the nation has depended for the last century and a half. 112¶ ¶ Another analysis has been equally pessimistic:¶ ¶ There is no doubt in anyone's mind that long-haul trucking can no longer keep pace with the skyrocketing demand for commercial transportation in the U.S... . nor are prospects hopeful. "It is unlikely that highway capacity will expand rapidly in the coming decades ... current annual revenues will suffice only to maintain the highway system, not provide significant new capacity." The bottom line: highway congestion will worsen, the speed and reliability of truck freight transportation will deteriorate, and costs to shippers and receivers may rise. 113¶ ¶ The United States already loses $ 200 billion a year due to congestion and bottlenecks. 114 Today, this remains the number one problem for over-the-road freight companies and their drivers. As one freight commentator has noted, "Highways are our assembly line. You cannot decouple economic growth from transportation growth." 115 The demand for intermodal freight will increase by 78% in the next decade, which means that at least $ 5 billion will have to be invested in infrastructure just to keep up. 116 The United States is rapidly exhausting its land-side transportation capacity. 117¶ Since NAFTA's inception, trade between the United States and Mexico has grown 232%, 118 yet neither country has made the adjustments necessary to handle the growing traffic. 119 NAFTA has steadily increased the demand for transportation infrastructure

and services - [*45] although its text gives this subject scant attention. However, transportation issues

have now become more and more visible. Rising logistic costs may well prove to be the last remaining barrier to NAFTA free trade . 120 One astute commentator has connected the dots:¶ ¶ It is the quality of

the transportation infrastructure that will ultimately determine competitiveness, economic growth , and overall success . As a result, NAFTA's ultimate success rests on the ability ... to plan and implement an efficient continental transportation system. To accomplish this objective, a new approach will be required, one that involves cooperation, commitment to a shared vision, and the basic understanding that the economic future of all three nations are intrinsically linked ... . 121¶ ¶ The full benefits of NAFTA can not be fully realized until the overland transportation system linking the U.S. and Mexico is modernized. 122 One author places these costs at more than $ 1.3 trillion. 123 Currently, however, there continues to be no continental strategy for upgrading and expanding NAFTA's transportation grid.¶ C. Insufficient Government Response¶ ¶ Federal, state, and local policy concerning intermodal transportation of freight throughout the United States is fragmented. 124 As one commentator recently said, "We've lost sight of the fact that the federal transportation system is broken; we need to formulate a new vision to address our needs." 125 Freight movement of goods needs to become more focused on critical national priorities, particularly those having to do with the efficient transport of international trade [*46] volumes. 126 The current method for planning and financing the infrastructure for intermodal movement of freight needs to be based on a broader system-wide approach. 127 In other words, a comprehensive, integrated national federal strategy is needed, rather than ad hoc financing and construction of mostly local projects. 128 Commentators have urged regional, inter-regional, 129 and even continental development of North American corridors that are oriented North-South instead of the traditional East-West pattern. 130 In essence, what is advocated is a modern-day version of the 1956-style interstate highway system--a system reoriented to twenty-first-century realities. 131¶ One of the best ideas is to build highway corridors dedicated for the exclusive use of tractor-trailers hauling intermodal containerized cargo. No cars would be allowed. Moreover, tolls could be charged to help pay for these unique beltways and the necessary connector roads. 132 Joint public-private partnerships could be used to build, own, and operate these truck-only semi-privatized roads. 133 Importantly, this kind of operating model accords with the forward-looking assessment of future freight transportation configurations done by the DOT and Federal Highway Administration in 2002. This assessment envisioned the development of multistate trade areas and corridors that would emphasize cross-border trade efficiency based on what was termed "regionally significant multimodal subnetworks." 134¶ [*47] Belatedly, in January 2006, the DOT released a draft of the "Framework for a National Freight Policy." 135 Two of its objectives were to focus on bottlenecks and facilitate regionally based solutions to freight gateway congestion, including promoting projects of both national and regional significance. 136 Then, in May of 2006, the DOT generated a follow-up report entitled, "Strategy to Reduce Congestions of America's Transportation Network." 137 Three of the articulated goals of this strategy were to target major freight bottlenecks; to establish DOT agency-level border congestion teams to prioritize operational and infrastructure improvements at the nation's most congested border crossings; and to accelerate the selection process for developing three to five multi-state, multi-use freight transportation corridors. 138¶ DOT Secretary, Norman Y. Mineta, promised that this new national initiative would provide a blueprint for federal, state, and local officials to use in order to remedy highway congestion. 139 Furthermore, the guidelines could be used by decision-makers to build additional highways that would "add capacity where it makes most sense." 140 However, most, if not all, of these objectives remain unfulfilled because 80% of the funds needed for such projects rely on federal funding. 141 Congress already has allocated these resources to specific projects for a five-year period running from 2005 through 2009. Most of them have little or nothing to do with reducing overall highway congestion or creating national North-South freight transportation corridors. 142 The synergy for innovation, in this regard, has all but dissipated.¶ [*48] ¶ VI. NAFTA Super Highway¶ ¶ There are several proposals for building NAFTA highway corridors running south-north/north-south through the United States. First, the western corridor would utilize I-5 along the coast to connect San Diego, California to Seattle, Washington; and then on to Vancouver, B.C. in Canada. Second, another route somewhat inland would follow I-19 and I-10, connecting Tucson, Arizona to Las Vegas, Nevada then running north to Calgary, Canada. 143 Third, and the most discussed corridor would use I-35, which would originate in Laredo, Texas and go north 1600 miles to Canada. The I-35 route would connect Laredo with San Antonio, Austin, and Dallas/Fort Worth in Texas; Oklahoma City; Wichita and Kansas City in Kansas; Des Moines, Iowa; Minneapolis/St. Paul in Missouri and on to Duluth, Minnesota. Fourth, there is a variation of the I-35 corridor called the I-69 route, starting with Laredo, Texas, but then heading northeast, connecting with Houston, Texas; Texarkana, which borders on Texas and Arkansas; Memphis, Tennessee; Evansville and Indianapolis in Indiana; and Lansing, Michigan, and finally on to the U.S./Canadian border at Port Huron for a total of 2100 miles. Proponents for building NAFTA highway corridors say the construction of the NAFTA corridors would represent the largest engineering project in U.S. history. 144¶ The plan for the I-35 corridor calls for a 1200-foot-wide right-of-way, equal to four football fields, which would feature ten lanes of [*49] highway - five lanes in each direction, with three lanes for automobiles and other vehicles and two lanes reserved for trucks. Six rail lines would run parallel to the highway, two of which would be used for the carriage of intermodal freight. Finally, there would be a 200-foot-wide space dedicated to oil and gas pipelines as well as for water, electric, and telecommunications installations. 145 The I-35 corridor would be a toll road. Truck traffic is projected to include 18,000 semi-and multi-trailer rigs a day, traveling at 80 miles per hour. The estimated construction costs are $ 31.4 million per mile or a total of over $ 145 billion for the I-35 corridor. 146 A segment of the I-

35 corridor is already being put to use by traders to avoid delays caused by congestion at the ports of Los Angeles, Long Beach, and Oakland in California. Goods are offloaded at the Mexican port of Lazaro Cardenas in the State of Michoacan and shipped by rail to Kansas City. 147 This route can also be used for outbound cargo. Mexican authorities have made two key concessions: first, U.S. exporters could post a one-time bond of $ 55,000 rather than the normal bond of $ 100,000 per container; and second, each shipment would be pre-inspected by Mexican customs officials who opened an office in Kansas City, allowing the goods to travel across the border without stopping. These cost-cutting measures are expected to increase NAFTA trade. 148¶ VII. Intra-Mexico¶ A. North-South Divide¶ 1. July 2006 Mexican Presidential Elections¶ ¶ The Mexican election for President held on July 2, 2006, revealed the deep schism separating the country - the rich North and the poor South. 149 The two leading candidates were polar opposites. Representing the Democratic Revolution Party (PRD), Andres Manuel Lopez [*50] Obrador, was a center-left contender who had been the popular Mayor of Mexico City. He represented the poor and underclass segments of society which were especially evident in southern Mexico. 150 As one analyst observed: "What [one] needs to understand is that ... Obrador is the symptom of a deeper problem: inequalities, disparities in wealth, extreme poverty, and a system of crony capitalism that erects huge barriers of entry for real competition and for empowerment of people in Mexico." 151 The other presidential contender was Felipe Calderon Hinojosa who was the candidate of the National Action Party (PAN), one of the more conservative parties in Mexico. He had previously served as Secretary of Energy for the Fox Administration. Calderon drew support from the upper class, businesspeople, and the educated middle class. 152 He presented himself as a man with clean hands who had never taken a bribe. 153 Calderon was a supporter of NAFTA, 154 but said he would negotiate a new accord directing investments into areas of Mexico from which migrants originated. 155¶ It is not surprising that during the election campaign one observer said "Mexican voters [were] more polarized between rich and poor than at any other time since the 1910 revolution." 156 The election exposed Mexico's deep ideological regional differences. 157 Calderon won by fewer than 244,000 votes out of nearly forty-two million cast, 158 which represents just 0.58 percentage points. 159 Obrador, during a rally of 1.2 million supporters in downtown Mexico City at the statue of the last Aztec emperor Cuauhtemoc, demanded a vote-by- [*51] vote recount. 160 However, following its own procedures, the Federal Electoral Tribunal confirmed Calderon as the winner. 161¶ 2. Northern Mexico Maquiladora Operations¶ ¶ For years, the dominant feature along Mexico's northern border with the United States has been maquiladora manufacturing facilities. A maquilero or maquiladora refers to the payment a miller receives for grinding corn. 162 The modern usage denotes a production sharing arrangement 163: U.S. firms set up an assembly plant, a maquiladora, on the Mexican side of the border to which it sends component parts or raw materials that are assembled or finished into final products using low-cost Mexican labor. These are re-exported back to the American company who sells them to consumers or other end-users. A bond is posted by the U.S. party in lieu of paying Mexican tariffs on the incoming components and materials. Later this is refunded in the form of a duty drawback upon re-export of the final product. U.S. customs cooperates by assessing tariffs only on the value added by the maquiladora operations. 164¶ The Mexican government originated maquiladoras as a job-creation, skills-enhancement and export-oriented program. 165 As of September 2006, there were over 6474 maquiladora/PITEX companies in Mexico, which temporarily imported components that were assembled or manufactured into goods or products for export. These operations produced 83% of Mexico's total exports, worth $ 108 billion annually. [*52] Most of the maquiladora plants are situated along Mexico's northern tier, contiguous to the U.S. border. They employ more than 1.2 million workers and pay out over one billion U.S. dollars in monthly wages and salaries. 166 October 2006 figures showed maquiladora employment expanding by 6.6% annually, creating 45,500 new jobs a year. 167 Maquiladoras primarily produce electronic equipment, clothing, appliances, and auto parts. Ninety percent of these products are shipped to the United States. 168 NAFTA has brought about several changes that affect maquiladora operations.¶ Mexico now allows the maquiladora form of doing business to operate anywhere in Mexico - although most of them are still located along the northern border. Maquiladoras may sell their output on the domestic Mexican market. 169 After losing their exempt status, maquiladoras must pay Mexican income, but not asset or value-added taxes. 170 In 2008, under NAFTA, the tariffs between the United [*53] States and Mexico will reach zero. 171 This means that all U.S.-and Mexico-originated goods and components will cross each other's borders duty-free. There will no longer be any need to post bonds or apply for duty drawbacks. Pre-NAFTA, all of Mexico's imported, foreign derived parts destined for maquiladora production were admitted duty-free. 172 On January 1, 2001, NAFTA Annex 303.7, 173 which implements NAFTA Article 303, 174 mandated that Mexican duties must be assessed on all foreign non-NAFTA imports coming into Mexico. This applies not only to parts and other inputs, but also to imported machinery and equipment used in the maquiladora manufacturing process. Only components satisfying NAFTA's ROO are entitled to duty-free treatment. 175 These NAFTA provisions encouraged, even compelled, many Asian suppliers of components used in maquiladora plants to move their operations into Mexico in order to satisfy the required North American content requirements. 176 Maquiladoras still remain popular as a way of doing business on the northern border of Mexico due to their proximity to the United States and its transportation grid that is essential for "just in time" deliveries relied upon by so many American businesses. 177¶ 3. Southern Mexico Zapatista Resistance and Pervasive Poverty¶ ¶ Southern Mexico is the home of the Zapatistas, a leftist revolutionary group with widespread support, especially among the indigenous [*54] Mayan Indian peoples. 178 The leader of the Zapatistas is subcomandante Marcos who traveled to thirty-one states in Mexico prior to the July 2, 2006 national elections. Marcos advocated a program of independent, autonomous self-governing municipalities and other political units throughout southern Mexico. 179 It all started on January 1, 1994, when the Zapatistas led an armed group of Mayan Indian rebels who marched into San Christobal de las Casas in the State of Chiapas and demanded that native indigenous peoples be recognized as the only legitimate government in the area. Significantly, this was the same day that NAFTA went into force and effect, which the Zapatistas opposed. The Mexican government's security forces were sent in and there was some shooting before the Zapatistas withdrew into their guerrilla sanctuaries.¶ Since then, the Zapatistas have focused on creating an alternate parallel government within southeastern Chiapas, organizing their own schools, clinics and organic-coffee co-ops. 180 The Zapatista ideology not only permeates this part of Mexico but is widely accepted by other indigenous Indian peoples throughout the entire isthmus regions of Central America. 181 The response of the Mexican government to widespread poverty and discontent in southern Mexico was to initiate an inter-regional infrastructure development program called Pan Puebla Panama ("PPP"). It contemplates ninety-four projects, ranging from telecommunications networks and road integration to tourism enhancement, building of free-trade zones and other sustainable development efforts, all of which have been denounced by the Native peoples who continue to push for programs that address poverty and promote human rights. 182¶ [*55] The PPP, however, has attracted strong interest from the leaders of the eight countries that occupy the isthmus of Central America. 183 In response, the Inter-American Development Bank has promised to help fund an electrical power-line project that would connect Mexico and Guatemala, 184 as well as provide funds to improve the Pacific corridor of the Pan American Highway that runs through the region. 185 But so far, only the forty-million-dollar Mexico-Guatemala cross-border electricity transmission project has been started. There are hopes that this is the first step to link Mexican and Central American power grids. 186¶ B. Cross-Isthmus Dry Canal¶ 1. Panama Canal Model¶ ¶ On December 31, 1999, the United States transferred sovereignty of the Panama Canal over to the

government of Panama. 187 The Canal extends fifty miles from Panama City on the Pacific Ocean to Colon on the Caribbean Sea. About 12% of all U.S. seaborne international trade passes through the Canal each year. This represents 70% of all ships using this passage. 188 The Canal is emerging as the region's most strategic facility for NAFTA countries. 189 Traffic utilizing the Canal has become increasingly congested. Most ships have to wait four or five days before entering the Canal. These delays cost shippers about $ 50,000 a day in operational expenses in addition to paying up to $ 400,000 to transit the Canal. 190 Nearly 14,000 ships [*56] annually make the crossing. 191 Over 2879 are container-cargo ships 192 carrying over three million forty-foot containers. 193 In fact, the Colon District in the Canal zone is the top container port in Latin American, handling 1.2 million TEUs. 194¶ The Panama Canal Authority will raise transit fees from forty-nine U.S. dollars per TEU for containers in 2006 to fifty-four U.S. dollars in 2007. 195 Ships transporting up to 5000 TEUs are the largest container ships that can presently use the Panama Canal. Bigger ships, known as post-Panamax ships, which represent 60% of the worldwide container fleet, are too large to pass through the locks. 196 Recently, the voters of Panama approved plans to double the Canal's capacity, enabling it to handle ships up to 12,000 TEUs. 197 According to Panama, this will cost $ 5.25 billion to be paid for by increased toll fees, 198 although others estimate the modernization will cost in excess [*57] of ten billion U.S. dollars. 199 These new locks are scheduled to be completed in 2014. 200 The extra lane will accommodate the next generation of mega-ships which will create a direct route from Asia to the east coast of the United States. 201¶ A unique feature of the Canal is the railroad that runs parallel to its route. 202 This track was built and is operated by the Kansas City Southern Railway under a concession granted by the Panama Canal Authority - the same company that currently owns and operates the Mexican railway concession connecting the United States to Mexican markets. 203 This new eight-million-U.S.-dollar high-speed trans-Panama rail system runs up to twelve trains daily in both directions. Each train has six cars, with each car having five wells, holding a total capacity of sixty double-stacked containers. Vessels take eight to twelve hours to transit the Canal, whereas trains carrying containers can make the trip in one hour and twenty minutes. 204 Post-Panamax ships that utilize this alternative high-speed rail service shuttle an estimated 150,000 containers a year across the Isthmus. 205¶ 2. Advantages of a Dry Canal¶ ¶ The relentless worldwide growth in container traffic, 206 coupled with the limited capacity of the Panama Canal to transit only a fixed number of container ships even with a third new set of locks, 207 has resurrected the idea of building a "dry canal" across the Isthmus to transport the huge excess of available cargo containers - although a dry canal is not a canal at all. It would be a multi-tracked, high-speed rail facility across the Isthmus to shuttle containers both east to west [*58] and west to east with modern, highly efficient ports on both the Pacific Ocean and Gulf of Mexico to unload and reload these containers onto ships. Pipelines, underground utilities, and highways could be built alongside the right-of-way. Free-trade zones could be established in appropriate locations allowing maquiladoras and other export manufacturing facilities to take advantage of worldwide access to component parts for easy assembly and re-export operations. 208¶ Interestingly, a route across Nicaragua was proposed by King Philip II of Spain in 1567. 209 Today, Nicaragua is still the most frequently mentioned site for another wet canal like Panama or a dry canal. 210 Latin American countries like Mexico have expressed interest in such a project. Lopez Obrador, the 2006 leftist candidate for Mexico's presidency, 211 advocated the construction of a planned shipping corridor across the Isthmus of Tehuantepec as an infrastructure project that could economically benefit the poorest part of Mexico. 212 Others share this idea since Mexico occupies a strategic geographical position on the Isthmus for a dry canal to be built. 213 This type of construction, for example, could connect the port of Coatzacoalcos on the Gulf of Mexico with the port of Salina Cruz on the Pacific coast, which would be a distance of 275 miles. 214 Such a project could become a powerful economic engine, providing much needed jobs and other benefits for Mexico's impoverished southern region.¶ The infrastructure decision on whether or not to build a dry canal along the lines suggested here is not simply an economic one. Mexico should consider its national interest in maintaining, even enhancing, [*59] its current political-economic status as the number one Latin American country. 215 As a NAFTA member, Mexico is the only one that has guaranteed, wide-open access to the North American market. Moreover, a Mexican dry-canal project could be part of the joint U.S.-Mexico efforts aimed at promoting economic growth pursuant to the PPP. 216 It also is consistent with Mexico's new internal domestic policy of utilizing public and private partnerships for infrastructure development projects. 217¶ Consequently, Mexico would be well advised to conduct a feasibility study on constructing a dry canal and companion port facilities of sufficient capacity to move large numbers of cargo containers across its Isthmus region with all its attendant maquiladora and other manufacturing ramifications. Mexico has access to most of the economic statistics it needs from the Panama model to calculate revenues which will be generated from such operations. 218 Mexico already has the availability of a private sector partner, the Kansas City Southern Railroad, that not only operates Mexico's rail system but also the Canal's parallel railway container shuttle facility. 219 Mexico also has experience in planning, building and operating ports. 220 Further help, if needed, is just a short distance away - the Port of Houston Authority International Corporation ("POHAIC"), which previously has done consulting work for Mexico. POHAIC provides expert consulting services [*60] with respect to all aspects of high quality modern port construction and operations that will be needed for this project. 221¶ Significantly, it now appears that newly elected Mexican President Felipe Calderon is fully supportive of such a project, pledging $ 1.5 billion to construct an intermodal corridor between the southern ports of Salina Cruz and Coatzacoalcos as an alternative for vessels now transiting the Panama Canal. 222 Hopefully this would feature an integrated and efficient high-speed rail network and not simply a multi-lane highway system for overland transportation of containers by truck.¶ VIII. Conclusion¶ ¶ The standard forty-foot shipping container, packed with manufactured goods for import/export transactions, has become a significant measurement of international trade applicable to the cross-border transactions between the United States and Mexico. Container traffic is expected to increase 75% by 2014. Containers must be physically transported by truck-and-trailers once

unloaded from container-cargo ships or otherwise set in motion for their destinations. About 75% of the goods traded between the United States and Mexico are transported by truck . The makers of semi-trucks can be counted on to build ever greater numbers of tractor-trailers to handle this anticipated increase in

intermodal freight business.¶ But trucks travel on roads: Many of the highways these trucks use to

implement NAFTA trade between the U nited S tates and Mexico are in mediocre to poor condition , and the chronic deterioration of the U.S. highway system continues unabated. Moreover, semi-trucks hauling loads of containers cause more wear and tear on roads than most other vehicles. The sheer volume of container-hauling traffic traveling on existing deteriorating roads cause frequent congestion and delays that increasingly are costing freight shippers more and more lost time and money. NAFTA's transportation

infrastructure is broken. These conditions are adversely affecting the flow of trade. Yet NAFTA , itself, has been surprisingly successful. Over the last thirteen years, two-way trade between the United States and Mexico [*61] has increased an average of 11.8% a year, growing 232% since inception, with a cumulative trade volume valued at an

astounding $ 2.7 trillion. But this success story is in jeopardy , not because of any term or provision of

NAFTA, but by the steadily declining conditions of the U.S. and, yes, Mexican

highways - which have become the functional equivalent of an indirect trade barrier. This is the

Achilles' heel of NAFTA .¶ New north/south highways, super NAFTA corridors,

need to be built . But none are actually being planned and no budget dollars have been appropriated for these purposes. Developing this key aspect of critical economic infrastructure for NAFTA must become a policy priority for both the United States and Mexico. But there have been promising developments during NAFTA's 13th year. The United States is taking positive steps to implement NAFTA's cross-border long-haul trucking provision, which will reduce costly delays at the borders, making shipment of NAFTA goods more efficient and economical. Further, Mexico's southern isthmus area is favorably being viewed as an ideal place to build what is called a dry canal to rapidly transport, by high-speed rail facilities from modern ports at either end, the increasingly large numbers of shipping containers that the Panama Canal cannot handle. Free-trade zones, where maquiladoras and other companies are located along this route, could provide a much needed boost to the southern economy of Mexico. If properly done, this project might in time rival the largest manufacturing area of northern Mexico along the U.S. border.

The plan ensures deep north American economic integration necessary for optimum NAFTA functioningBlank, Golob and Stanley, 06 – *Stephen, Pace University, **Stephanie R., Baruch College, ***Guy, McGill University (“Staying Alive: North American Competitiveness and the Challenge of Asia,” Pace University Lubin School of Business, 10/1/06, http://digitalcommons.pace.edu/cgi/viewcontent.cgi?article=1077&context=lubinfaculty_workingpapers)

The cumulative result of all this cross-border trade and investment has been, for most practical purposes, the development of an integrated regional economy based upon a degree of collaboration and complementarity between countries that is unprecedented. But most notably, it is integration that has been driven “bottom-up” by businesses looking for new ways to expand and survive, and its evolution has been uneven and to some extent invisible on the national radar screens because it has accelerated in particular cross-border regions, moved along with help by adaptive and, in their own way, entrepreneurial subnational governments (i.e., local and state/provincial jurisdictions) enjoying relative autonomy within all three federalist systems. Freed – or, from a somewhat different political perspective, unleashed – from top-down government projects and planning, North American integration has deepened in an uneven, market-driven, de facto manner while sidestepping the paralyzing political battles over sovereignty that an attempt to adopt a European system would certainly have set off. While advocates of North American integration may have celebrated such an “under the radar” approach in the past, the challenge of expanding trade and competition with Asia raises the question regarding whether “North America, Inc.” can continue down this market-based, decentralized adaptive path into the future. While business was pretty much able to retool itself in the 1980s, today’s new challenges reveal what the limits to bottom-up growth, specifically having to do with issues such as transportation, border

infrastructure, and regulation. It is both the scale of China’s export push (helped along with the expiration of the multifibre agreement) and the technological leaps made in transoceanic shipping that have raised concerns

regarding the sorry state of North America’s ports, railways, and roads. But such concerns naturally invoke the

need of public authorities to take key investment decisions (whether public or publicprivate

or privatized) regarding these key nodes of municipal, state/provincial, and national infrastructure that now must serve trinational or regional economic interests. Specifically, if North America is to “stay alive” and remain competitive in today’s global markets – by which we mean not a “Fortress North America” exclusionary strategy, but rather a strategy that seeks to attract both investment and trade from dynamic Asian economies by maximizing the competitive advantage of North America as a site of production, consumer markets, and innovation – the moment of truth has arrived regarding the unsexy but essential issue of the health and maintenance of the “plumbing” of the North American economic system. This paper presents an overview of this issue, first arguing that the architecture of North American supply chains – based upon corporate adaptations featuring their innovative use of transportation and logistics networks – has shifted from being the leading edge of the region’s competitiveness in the past two decades to being the

leading edge of its vulnerability in a number of ways. Specifically, we argue that the regional economic

system has reached the limits to “bottom-up” growth, and now requires a more integrated North American transportation strategy in order to adapt to an increasingly competitive global market environment. The next section of the paper then focuses on North America’s growing trade with Asia, and discusses why and how Asia has become the focal point for broader discussions of North American competitiveness. The following section looks at how the cross-border region within NAFTA most obviously affected by these new trading patterns – namely, the Pacific Northwest – has adapted to these forces, and why this matters greatly for the entire North American economic system. Finally, the concluding section identifies a coming crisis point in North American transportation infrastructure, and argues for regions like the Pacific Northwest, which stands at the leading edge of our continent’s move towards a new level of competitiveness, to rethink their particular interests as North American interests, and for stakeholder groups and their leaders to use those kinds of arguments with greater energy and precision, both to persuade their own constituents and to seek allies farther afield, continentally speaking. With those coalitions in place, the kind of North American thinking and policymaking that will be required to confront, and overcome, the transportation crisis may have a fighting chance. NAFTA SUPPLY CHAINS: SOURCE OF COMPETITIVE

ADVANTAGE For many North American firms, a significant competitive advantage rests upon their

capacity to build networks and supply chains that link regional specializations across national borders. For example, the North American auto supply chain stretches from parts

manufactures in Mexico, through plants in the US to assembly operations in Canada. Components, parts and ultimately finished autos move along this extended production system. This is the case with virtually all of our leading companies, ranging from automotive products to aircraft components, to computers, to chemicals, to food products, housing products, pharmaceuticals, industrial goods such as subcomponents of manufacturing systems, as well as commodities

and raw materials of every description. The ability to operate these networks efficiently depends on transportation and logistics capacities. In a world of just-in-time production systems, transportation

infrastructure and supply chain management become absolutely critical elements of business success – and even survival. Advantages of location and service costs are multiplied by sophisticated control and optimization techniques aided by extensive use of GSP (Geo-Service Providing) and RFID (Radio Frequency Identification) technologies designed to monitor shipments at great distances. Clearly, then, the

transportation, logistics, and border capacities have become the nerves and sinews of the North American economy. Like most of NAFTA, it is an emergent reality arising from millions of decisions starting with consumer demand and moving backward along the supply chain to bring about a substantial re-orientation of transportation networks in North America, from predominantly East-West (or West-East) to now North-South as well as EastWest. However, today’s resulting geography of ports and flows reflect a new balance: that between the land-based, North-South NAFTA trade flows and the newer shipping-based EastWest flows of the new, inter-regional face of globalization: the boom of trade with Asia. This new balance between NAFTA trade and global markets is concentrated along the US borders and coastal regions plus some large cities. On the one hand, this, too, represents significant adaptation. This adaptation has been so good, in fact, that the volume of shipments is now hitting the limits of the system, specifically the limits of port technology and capacity, of rail capacity, and of infrastructure aging. Unlike the first round of NAFTA adaptation, however, more than simply private sector strategic adaptation is now

required. What is needed, it appears, is a more effective continental transportation

infrastructure that is adequate to the challenge of melding the NAFTA and global flows. The question hanging over governments, entrepreneurs, and other ‘stakeholders’ in NAFTA-dependent and trade-dependent communities in our region, therefore, is whether the North American economic system can evolve to accommodate that challenge. By themselves, and by design, the three NAFTA national governments lack the formal mechanisms of cooperation, coordination, and, most importantly, implementation in order to launch the kinds of region-wide infrastructure projects that the European Union has successfully used to facilitate the movement of goods into, out of, and within its single market. Therefore, we should not have been surprised that the increase in volumes of goods flowing across North America’s internal borders outran the capacity of our roads, bridges, railroads and border crossings even before 9/11. Today, North America’s transportation and border infrastructure barely suffice to support our economy; and given the obstacles to regional policy coordination, there is little margin left for future expansion. To be sure, one can argue that what is lacking is not simply institutionalized channels for cooperation, but also political will. In practice, however, while governmental prioritizing can lead to the creation of new institutionalized channels, their effective coordination and operation is not a foregone conclusion. Here, the management of North America’s internal borders since 9-11 provides an instructive example. No one can dispute that, following the terrorist attacks in 2001 – though, perhaps, for different domestic, bilateral and global reasons – border security has become a top priority for all three governments. Indeed, substantial efforts have been made to improve the physical infrastructure at border crossings in the past five years. The US-Canada “Smart Border” agreement and the parallel agreement with Mexico represent key commitments to improve border management. Various organizations and border communities have initiated dialogues with government agencies that have achieved significant incremental improvement in border processes. Programs such as FAST and NEXUS also were developed and expanded to demonstrate that governments were doing their best to ensure security against terrorist threats without unduly interfering with cross-border commerce. However, in practice there has been much that remains to be done, and the process as well as the disappointing outcome point to the disjuncture between the rhetoric of governmental prioritization and the reality of

institutional confusion. The pyramiding of requirements and programs, each of which can inhibit quick

border processing, and all of which together require high degrees of inter-agency coordination (and typically involve federal, state and even local governments) as well as new levels of cooperation with business and border communities, has created tumult in some instances and threatens what Stephen Flynn calls “a potential train wreck” 3 Thus, even at the geographic place where North American regional interests would have the greatest salience, and in a high-priority issue area for all three governments – and, arguably, publics – the ability to forge a North American solution to a North American problem remains elusive. Considerably less attention has been paid to developing a sense of a North American transportation and logistics structure; instead, rhetoric has run high, while vested interests have controlled the policy process to the detriment of greater national and North American interests. People have talked about “NAFTA Superhighways” for a decade, and it has been clear since the mid-1980s that increased volumes of goods flowing north and south demand new approaches to transportation infrastructure. Washington has spent vast sums in a series of highway funding bills since 1991 to identify and improve “high priority corridors” that would facilitate northsouth trade. However, these funds became a pot into which every member of Congress dipped his/her fingers. The number of designated high priority corridors soared as members earmarked funds for their own favored projects. The result is that the map of so-called “high priority corridors” looks like a plate of spaghetti. Highways and border crossings have been improved here and there, but there is no movement toward developing a true North American highway system. Certainly nothing like the super multimodal corridors, wired with fiber-optics and the latest digital frills, has come about. If anything, the general state of US highways has deteriorated over the past decade. In its latest “Report Card,” the American Society of Civil Engineers awards the American government a D- for maintaining existing roads and bridges. The US is $40 billion behind just in maintaining existing roads. 4 Add to this the challenge of bringing Mexico’s roads into the 21 st century; the joint project of fixing crumbling bridges and overburdened access points across both internal borders; the need to construct “inland ports” to connect incoming containers to both rail and road routes towards the North American interior and beyond; and the continued distortions of local “pork-driven” incentives, and the outlook for trinational regional coordination on this critical issue starts to look decidedly bleak. NORTH AMERICAN TRADE WITH ASIA At this point, it is important to recall that the outlook for the future of the pre-NAFTA North American economies in the early 1980s was also decidedly bleak – given stagflation in the US, the debt crisis in Mexico, and the collapse of oil prices affecting both Canada and Mexico

(and their respective experiments with protectionist economic policies). But it was at this time, facing this bleak picture, that businesses in the US, Mexico and Canada responded by retooling and revamping their corporate strategies, and began to make use of innovations in technology and supply-chain management techniques to bring us the North American economic system we have today. In the past few years, echoing the shock of the early ’80s, fears of the onslaught of Chinese cheap manufactures have produced a similar sense of dread, most notably in Mexico, which had thought that NAFTA guaranteed it a preferential market for these low-value added exports. But there has also been a more positive shock to the North American economic system from Asia: the inflow of investment from China matching the historic inflows from Japan, coupled with China’s hunger for raw materials plentiful in all three NAFTA countries, arguably have opened up a range of opportunities for the region to attract the business of this new global economic superpower. Indeed, the challenge to North America’s competitive advantage as a region is not necessarily whether we can outproduce and outsell China or Asia per se, but whether we can adapt effectively to the new global environment, which would ideally mean the inclusion of North America into rapidly expanding and dynamic globalized production networks that encompass our own businesses and those of Asia. There has been some recent evidence that this theme of regional (vs. national) “North American competitiveness” has some traction in the halls of power in all three NAFTA countries as a potential organizing principle for a new phase of post-NAFTA integration. Three recent reports speak directly to the issue of North American competitiveness. The first, entitled “Building a North American Community,” was drafted by a Task Force sponsored by the Canadian Council of Chief Executives, the Consejo Mexicano de Asuntos Internacionales, and the Council on Foreign Relations. 5 The second was the “Report to Leaders, Security and Prosperity Partnership of North America,” presented in June 2005 by the three NAFTA nations’ foreign ministers in compliance with the stated goal of the Waco trilateral leaders’ summit to produce a set of goals for the new SPP (including a timetable for incremental steps) within 90 days of the summit meeting. 6 Both of these reports underline the need to press forward in building a seamless North American economic system as the foundation for prosperous and growing US, Canadian, and Mexican communities in the 21 st century. However, the third report, the most recent Report to Leaders submitted by the “Security” and “Prosperity” ministers of the three governments in August 2006, goes one step further, and announces the creation of what is called a “North American Competitiveness Council,” adopting the new buzzword of competitiveness for the name of what is to be the main consultative body of the private sector to the SPP process. 7 And although the SPP’s stated aims do maintain a distinctly nation-based outlook that belies a zero-sum view of “competitiveness” (i.e., implying that the goal is to give North American businesses an edge to “beat out” businesses from other regions), the global nature of so many North American businesses which are to be the main “stakeholders” for the SPP augurs for a push to make the region attractive for both trade and investment. Looking now a year later, while SPP has been virtually invisible in the public eye, its working groups have been quietly moving ahead on a few of its more ambitious goals, such as a North American steel strategy via a new North American Steel Trade Committee (NASTC). 8 And in the area of transportation, the SPP’s “Prosperity” agenda includes the goals of “improv[ing] the safety and efficiency of North America’s transportation system by expanding market access, facilitating multimodal corridors, reducing congestion, and alleviating bottlenecks at the border.” 9 Indeed, the US Department of Transportation (DOT) lists as its participation in SPP 11 proposed projects under nine separate sub-agencies, including a US-Mexico Mass Transit Border Project, joint rail inspections, a North American Transportation Statistics Interchange, and a project on short sea shipping. 10 While the active participation of numerous government agencies and the promises of trinational cooperation are encouraging, the question becomes whether the pressure on the region’s infrastructure coming from the Asian trade boom will be enough to push ahead the more continental, multi-modal approach to transportation that is needed at this time. There is still a need to develop trinational statistics which can then be used as a vehicle for two key policymaking priorities: weighing alternative means to expand North American port capacity and judging how much new capacity may be required under different economic scenarios. It is not at all clear that enough mid-level public servants, let alone leaders in the policymaking process, have begun to think either in continental terms or in network centric multi-modal terms. Specifically, possibly because of the continued political “third rail” of sovereignty, 11 projects that hint at tri-partite harmonization of highway policies have gotten little public airing, despite their patent rationality. Reducing inter-modal switching costs and generating ways to ensure flow optimization end to end among all transportation modes are also key to coping with new global flows, which are mostly containerized and need to be transported inland in the most costeffective (and safest) way. Improving competitiveness for the continent requires more attention to multi-modal transport, rather than thinking of transportation as separate silos – rail, road, water, air. But perhaps most profoundly, this new challenge will require stakeholders in the public and private sectors to view the North American economic system as a whole that is not only greater than the sum of its parts, but is also critically dependent upon the dynamic – and above all, efficient – interchange among its constituent regions,

clusters, and supply chain locations. Thus, the development of transportation infrastructure in one subregion, such as the expansion of ports in the Pacific Northwest with an eye to the expanding trade with Asia, is not merely a vehicle for expanding bilateral trade between the US or Canada and China; it is – or can be – an investment

in the infrastructure that will permit the whole North American continental region to consolidate and expand economic competitiveness in this era of global trade and production. GATEWAY TO ASIA, OR TO NOWHERE: THE PACIFIC NORTHWEST IN NORTH AMERICA In his influential book on Ontario as a “North American region-state,” Thomas Courchene challenged us to rethink the economic geography of our continent, and the role played by our subnational political units in our national economies, and in a larger continental system. As Courchene observes: “It is not just that nearly all Canada’s provinces are more integrated (in terms of exports) internationally than east-west, but also that Canada’s regions, which in some cases would incorporate more than one province, are economically/industrially quite distinct from one another. … This means that it is time to view Canada as a series of northsouth, cross-border economies with quite distinct industrial structures.” 12 More recently, journalistic attention has been focused on “Mexamerica,” or “Amexica,” the borderlands that span the US-Mexican border, as either possessing or developing a distinct economic and cultural space, 13 while scholarly and policy attention has raised the profile of what Canada’s Policy Research Initiative (PRI) has identified as North America’s “cross-border regions,” which are characterized primarily by “substantial economic links, socio-cultural similarities, and the presence of cross-border organization.” 14 What this last definition highlights, and what we are arguing in this paper, is that while the functional necessity of cooperation has driven North American integration across national

borders, it is the quality and quantity of organization – the formal and informal mechanisms allowing

local and vested interests in both the public and private sectors to advance common regional interests – that holds the key to its optimization. That is, while British Columbia is closely tied economically with Washington

and Oregon, and may share social and cultural characteristics, what will ultimately matter for its own

future competitiveness, and its contribution to North American competitiveness, will be as much political will as economic muscle.

NAFTA is a global model for trade agreements Pastor, 04 – Robert A., Robert A., Professor at and Founding Director of the Center for North American Studies at American University (“North America's Second ` Decade,” Foreign Affairs, Jan/Feb 2004)

North America's second decade poses a distinct challenge for each government. First, the new Canadian prime minister, Paul Martin, should take the lead in replacing the dual bilateralism of the past with rule-based North American institutions. If he leads, Mexico will support him, and the United States will soon follow. Mexico, for its part, should demonstrate how it would use a North American Investment Fund to double its growth rate and begin closing the development gap. Finally, the United States should redefine its leadership in the twenty-first century to inspire support

rather than resentment and fear. If Washington can adjust its interests to align with those

of its neighbors, the world will look to the United States in a new way. These three challenges

constitute an agenda of great consequence for North America in its second decade. Success will not only

energize the continent; it will provide a model for other regions around the world.

Specifically key to provide a model for TPP negotiationsDon Cayo (writer for the Vancouver Sun) February 13, 2013 “NAFTA has provided a thoroughly modern template for free trade” http://www.vancouversun.com/business/NAFTA+provided+thoroughly+modern+template+free+trade/7957474/story.html

If you think of NAFTA as a recent and thoroughly modern kind of trade agreement, well ... at least you're not entirely wrong.¶ Hard as I find this to believe, this pact is two decades old - an age at which agreements on the ever-evolving international stage start to be viewed through the lens of history. And, as NAFTA was conceived and negotiated in the late 1980s and early 1990s, it's dated, it's limited in scope and it's rife with irritants both large and small that continue

to rear their heads from time to time.¶ On the other hand, I was reminded when I sat in on a NAFTA-oriented session of the ExpoPlaza Latina trade show and conference at SFU Harbour Centre last week, what the working arrangement between Canada, the United States and Mexico has evolved into is something else again.¶ The agreement

has become the blueprint for a highly integrated North American economy made up of 444 million people with a combined GDP of $17 trillion a year. It may have started out as what most Canadians regarded as a deal to facilitate the selling of "our" stuff to "them," but it has morphed into a marketplace of "us." The bits and pieces that combine to create a single car, for example, might cross an international border seven or eight times during the manufacturing process.¶ Ironically, B.C.'s sales to the United States, still our most important free trade partner, have slipped since the deal was first inked from 68 per cent of what we sell to 42 per cent (the total for all Canada dropped from 87 per cent to 72). The sharp drop in this ratio is partly due to weak demand as a result of the post-2008 economic woes in the U.S., but it's also partly - and more healthily - thanks to brisk growth in what we sell to other countries. And any losses that it implies is more than compensated for by the more than tripling of the total trade volumes.¶ Indeed, $50,000 worth of goods and services is now crossing the U.S./ Canada border every second, noted Joseph Salazar, the director for economic policy in the U.S. Bureau of Western Hemisphere Affairs. That's roughly $600,000 in the time it typically takes to read the previous sentence aloud.¶ But as important as all this economic activity - maybe eventually more important, depending how the world continues to unfold - is how NAFTA has shaped Canadians' outlook toward trade.¶ Canada has always been a trading nation, but for most of our history - and still to a great extent today - we have been content to merely ship to offshore buyers the raw or nearly raw commodities we have in great abundance. NAFTA has, for the first time, drawn us into truly globalized economic interactions - not just making sales, but also collaborative production, integrated international investing, and more.¶ It would be hard to find a better example than mining, an industry that's big in Canada as a whole and huge in B.C.¶ In Mexico, the first non-traditional market that opened up to Canadian companies as a result of a free trade deal, Canadian owners account for 74 per cent of the foreign-owned mining investment, and for 70 per cent of the exploration being done today, said Alan Minz, Pacific regional director the Canadian Department of Foreign Affairs and International Trade. This is not small potatoes - Mexico is a mining powerhouse, ranked in the top five as a place to invest in mining,

and particularly rich in silver and gold.¶ Minz noted that participation in NAFTA has allowed Canadian companies

to cut their teeth in the international marketplace before moving to ever more countries. And it changed perceptions about what trade deals can and should be , leading to developments like the massive and comprehensive Canada-European Union free trade deal that is

said to be just weeks from completion, and the more fledgling but hugely ambitious Trans-Pacific

Partnership .¶ In short, NAFTA may not have started life as what some of us regard to day as a

thoroughly modern template for free trade - but it sure is leading us into that world.

Now is key – negotiations are reaching a tipping point. Breakdown unravels the entire negotiations – crushes strategic Asia ‘pivot’ and US leadershipClaude Barfield (former consultant to the office of the US Trade Representative and a resident scholar at the American Enterprise Institute) January 10, 2013 “Crunch time for the TPP” http://www.eastasiaforum.org/2013/01/10/crunch-time-for-the-tpp/

During President Obama’s recent trip to Asia, TPP nations set a deadline of October 2013 to conclude the negotiations. TPP members have blown past a previous deadline of November 2011:

should they fail again at the end of 2013 there is the real danger that the talks will unravel , and East Asian nations will turn to alternatives, pushed strongly by China .¶ On 18 November, as President Obama embarked on the highly symbolic trip to Asia, his top security and economic

adviser, Thomas Donilon, asserted that the TPP agreement is ‘the most significant negotiation currently underway in the international trading system’ . It is also the central lynchpin of the Obama administration’s much touted diplomatic and security

‘pivot’ to Asia. Thus, should the negotiations falter or fail, the result would be not only a

severe economic setback, but also a dramatic symbolic defeat for US leadership in the region.¶ Positively, in an era in which the United States is deeply divided over globalisation and free trade initiatives,

the TPP enjoys unusual bipartisan support . Launched under the Bush administration, the agreement has been taken up as a signature accomplishment for President Obama’s second term. During the 2012 presidential campaign, however, Republican Party candidate Mitt Romney also voiced strong support for the pact. Since the election, Texan Republican Kevin Brady, who heads the all-important House trade subcommittee, has urged the president to ‘go big’ on trade during his second term, and complete the TPP in 2013.¶ Just what is the TPP and why is it so significant? The current negotiations grew out of a four-nation agreement concluded in 2006 by Chile, New Zealand, Brunei and Singapore. Subsequently, Australia, Peru, Vietnam and the United States signed on, followed in 2010 by Malaysia, and most recently by Mexico and Canada. Detailed negotiations began in early 2010, and since then there have been 15 formal sessions. The ultimate goal of the TPP is to include all of the nations in the APEC forum.¶ At the present time, should the 11-nation negotiation be successful, the TPP would encompass a free trade area covering some 658 million people, and almost US$21 trillion in economic activity. If South Korea and Japan join the negotiations, as many expect in 2013–14, the free market territory would expand to a combined GDP of US$26 trillion, constituting 30 per cent of world exports.¶ The TPP has been called the first ‘21st-Century Agreement’. If successful, it will put in place international trade rules to lower or eliminate behind-the-border domestic barriers to foreign competition. Among the 29 chapters under negotiation will be rules to open government procurement contracts to foreign competitors; rules to liberalise service sectors, such as telecommunications, banking and accounting; non-discriminatory health and safety regulations; fair competition with state-owned enterprises; and a level playing field for foreign investment.¶ Despite the emphasis on 21st-century regulatory reform, there are also longstanding 20th-century trade issues that will prove difficult to resolve. For the United States, the greatest challenges stem from sugar, dairy and cotton protection and subsidies; textile and so-called rules of origin that hamper clothing supply chains; and, finally, union demands for interference with the labour laws of TPP trading partners. In the end, the key to success will come down to trade-offs

between 21st-century liberalisation and old-fashioned 20th-century protectionism.¶ The urgency to successfully conclude TPP negotiations is heightened by the appearance of an alternative

path for Asian regionalism that does not include the United States . At the November 2012 East Asia Summit, ASEAN leaders, as well as Australia, China, India, Japan, New Zealand and South Korea, formally announced that they would begin negotiations in 2013 for a Regional Comprehensive Economic Partnership (RCEP), with the goal of concluding the pact by 2015.¶ Much of the impetus for this launch came from China, which has long pressed for an exclusive, intra-Asian regional economic architecture. Given the diversity of the membership (including still-closed economies, such as India and Indonesia, and less-developed economies, such as Laos and Cambodia) and an

uncertain timetable, RCEP is not an immediate challenge to the TPP. But should the US-led pact dissolve into contentious, even intractable, conflicts that defy resolution, China’s preferred

option of the RCEP will provide a hard-to-resist alternative .¶ Thus, much is riding on the ability of the Obama administration to advance TPP liberalisation goals, while crafting compromises that are acceptable both to other TPP partners and to the US Congress and business community.

Asia pivot key to solve multiple hotspots from escalating to nuclear warColby 11 – Elbridge Colby, research analyst at the Center for Naval Analyses, served as policy advisor to the Secretary of Defense’s Representative to the New START talks, expert advisor to the Congressional Strategic Posture Commission, August 10, 2011, “Why the U.S. Needs its Liberal Empire,” The Diplomat, online: http://the-diplomat.com/2011/08/10/why-us-needs-its-liberal-empire/2/?print=yes

But the pendulum shouldn’t be allowed to swing too far toward an incautious retrenchment. For our problem hasn’t

been overseas commitments and interventions as such, but the kinds of interventions. The US alliance and partnership structure, what the late William Odom called the United States’ ‘liberal empire’ that includes a

substantial military presence and a willingness to use it in the defence of US and allied interests, remains a vital component of US security and global stability and prosperity. This system of voluntary and consensual cooperation under US leadership, particularly in the security realm, constitutes a formidable bloc defending the liberal international order.¶ But, in part due to poor decision-making in Washington, this system is under strain, particularly in East Asia, where the security situation has become tenser even as the region continues to become the centre of the global economy.¶ A nuclear North Korea’s violent behaviour threatens South Korea and Japan, as well as US forces on the peninsula; Pyongyang’s development of a

road mobile Intercontinental Ballistic Missile, moreover, brings into sight the day when North Korea could threaten the United States itself with nuclear attack, a prospect that will further

imperil stability in the region.¶ More broadly, the rise of China – and especially its rapid and opaque military build-up – combined with its increasing assertiveness in regional disputes is troubling to the United States and its allies and partners across the region. Particularly relevant to the US military presence in the western Pacific is the development of Beijing’s anti-access and area denial capabilities, including the DF-21D anti-ship ballistic missile, more capable anti-ship cruise missiles, attack submarines, attack aircraft, smart mines, torpedoes,

and other assets.¶ While Beijing remains a constructive contributor on a range of matters, these capabilities will give China the growing power to deny the United States the ability to operate effectively in the western Pacific, and

thus the potential to undermine the US-guaranteed security substructure that has defined littoral East Asia since World War II. Even if China says today it won’t exploit this growing capability, who can tell what tomorrow or the next day will bring?¶ Naturally, US efforts to build up forces in the western Pacific in response to future Chinese force improvements must be coupled with efforts to engage Beijing as a responsible stakeholder; indeed, a strengthened but appropriately restrained military posture will enable rather

than detract from such engagement. ¶ In short, the United States must increase its involvement in East Asia rather than decrease it . Simply maintaining the military balance in the western Pacific will, however, involve substantial investments to improve US capabilities. It will also require augmented contributions to the common defence by US allies that have long enjoyed low defence budgets under the US security umbrella. This won’t be cheap, for these requirements can’t be met simply by incremental additions to the existing posture, but will have to include advances in air, naval, space, cyber, and other expensive high-tech capabilities.¶ Yet such efforts are

vital, for East Asia represents the economic future, and its strategic developments will

determine which country or countries set the international rules that shape that economic future. Conversely, US interventions in the Middle East and, to a lesser degree, in south-eastern Europe have been driven by far more ambitious and aspirational conceptions of the national interest,

encompassing the proposition that failing or illiberally governed peripheral states can contribute to an instability that nurtures terrorism and impedes economic growth. Regardless of whether this

proposition is true, the effort is rightly seen by the new political tide not to be worth the benefits gained. Moreover, the United States can scale (and has scaled) back nation-building plans in Iraq, Afghanistan, and the Balkans without undermining its vital interests in ensuring the free flow of oil and in preventing terrorism.¶ The lesson to be drawn from recent years is not, then, that the United States should scale back or shun overseas commitments as such, but rather that we must be more discriminating in making and acting upon them. A total US unwillingness to intervene would pull the rug out from under the US-led structure, leaving the international system prey to disorder at the least, and at worst to chaos or dominance by others who could not be counted on to look out

for US interests.¶ We need to focus on making the right interventions, not

forswearing them completely. In practice, this means a more substantial focus on East Asia and the serious security challenges there, and less emphasis on the Middle East. ¶ This isn’t to say that the United States should be unwilling to intervene in the Middle East. Rather, it is to say that our interventions there should be more tightly connected to concrete objectives such as protecting the free flow of oil

from the region, preventing terrorist attacks against the United States and its allies, and forestalling or,

if necessary, containing nuclear prolif eration as opposed to the more idealistic aspirations to transform the region’s societies. ¶ These more concrete objectives can be better met by the more judicious and economical use of

our military power. More broadly, however, it means a shift in US emphasis away from the greater Middle East toward the Asia-Pacific region, which dwarfs the former in economic and military potential and in the dynamism of its societies. The Asia-Pacific region, with its hard-charging economies and growing presence on the global stage, is where the future of the international security and economic system will be set, and it is there that Washington needs to focus its attention, especially in light of rising regional

security challenges. ¶ In light of US budgetary pressures, including the hundreds of billions

in ‘security’ related money to be cut as part of the debt ceiling deal, it’s doubly important that US security dollars be allocated to the most pressing tasks – shoring up the

US position in the most important region of the world, the Asia -Pacific . It will also require restraint in expenditure on those challenges and regions that don’t touch so directly on the future

of US security and prosperity. ¶ As Americans debate the proper US global role in the wake of the 2008 financial crisis and Iraq and Afghanistan, they would do well to direct their ire not at overseas commitments and intervention as such, but rather at those not tied to core US interests and the sustainment and adaptation of the ‘liberal empire’ that we have constructed and maintained since World War II.¶ Defenders of our important overseas links and activities should clearly distinguish their cause from the hyperactive and barely restrained approach represented by those who, unsatisfied with seeing the United States tied down in three Middle Eastern countries, seek intervention

in yet more, such as Syria. Indeed, those who refuse to scale back US interventions in the Middle East

or call for still more are directly contributing to the weakening of US

commitments in East Asia, given strategic developments in the region and a

sharply constrained budgetary environment in Washington.¶ We can no longer afford, either strategically or financially, to squander our power in unnecessary and ill-advised interventions and nation-building efforts. The ability and will to intervene is too important to be so wasted.

NAFTA is key to heg and preventing protectionism – hemispheric integration and liberal institutional support Agrasoy, 4 - Bachelor of Arts degree in International Trade and a Bachelor of Science degree in Management Information Systems from Bogazici University in Istanbul, Turkey, where he specialized in international trade and investment, Master of Arts in Economics from McGill University in Montreal, ROI Research Analyst Director of Operations, Public Sector, overseeing worldwide public sector operations at ROI (Emre, “NAFTA: as a Means of an U.S. Hegemony Creation in the Region?” May 23 2004, http://emreagrasoy.awardspace.com/nafta.pdf)

Although U.S. seemed the sole dominant power after the collapse of Soviet

Union, U.S. envisaged that some areas of influence 2 would have a huge potential to challenge its politic and economic hegemony in the world, which is leading towards a tripolar economic structure. 3 Thus, “Fortress North America” must be erected to challenge “Fortress Europe”. Both must be prepared to repel onslaught of Asian products. 4 At

that time the North American Free Trade Agreement (NAFTA) came into effect with the initiatives of U.S. The NAFTA includes Canada, the United States, and Mexico, with a total (as of

2000) combined population of 410 million inhabitants, and combined GDP of over $11 billion U.S. 5 It created the world’s largest regional freetrade zone, directly challenging the growing primacy of the European Community and the Japan-East Asia bloc 6 and aiming to maintain its superpower positio n. In contrast to the EU, the NAFTA represents a less ambitious effort 7 to establish a common continental market for goods and services, and common protections for private investors and businesses, with little attention or interest devoted to developing a continental political or institutional dimension. The important structural and institutional differences among the NAFTA partners are the reasons behind that the NAFTA has limited its scope to the deregulation of trade and investment flows within the NAFTA zone, rather than attempting a deeper, European-style political and regulatory harmonization. The model of the world economy assumes cut-throat trade competition between the three regional blocks. To survive in this competition each block should have a leading nation, which provides the capital and managerial skills, and a group of less developed nations, which supply the cheap labor and mineral resources takes the role

of a regulatory body and dominates the NAFTA economically and politically. So, U.S. as the dominant nation 8 intended to hook up with Mexico to obtain low-cost labor and oil. Canada’s role is primarily “an energy and resource hinterland”. 9 For U.S., NAFTA will mean a chance to regain competitive positions eroded by Japanese and European rivals. 10 For the U.S. the implementation of a

North American free trade zone represented an important but hardly epochal

development, one which mostly served to reinforce its already-existing economic and strategic dominance on the continent and even in the world. Trade patterns within the NAFTA conform largely to a “hub-and-spoke” structure 11 , with the U.S. located at both the geographical and the economic center of the continent . 12 The United States adopted economic regionalism

toward the end of the twentieth century. NAFTA of the early 1990s were crafted to apply the liberal policies and free market principles closer to U.S policies . The United States did not impose NAFTA on North America but it clearly had an inordinate

and even hegemonic influence on North America’s adherence to the disciplines and principles favored by the United States. 13 Free trade, reciprocity, national treatment of investment, domestic trade policy, dispute settlement, labor and environment protection, and liberalization of services as well as agriculture were NAFTA tenets. 14

NAFTA is a U.S.-led RIA, a symbolic and genuine innovation that more formally organized North America with the United States at its geo-economic hub. The NAFTA would draw both neighbors more closely into the U.S. sphere of influence, reducing the perceived geopolitical risk to U.S. interests that had been posed by occasional outbreaks of nationalist sentiment in Mexico and Canada. 15 Mexico’s place in North America raises issues about the tradeoffs involved in integrating more closely developed and developing

economies. This is what made NAFTA so consequential for the possibility of linking the global North and the global South in the Americas. The

NAFTA is contributing to the broad US goal of promoting economic growth, political stability, and progress toward democracy in Mexico. 16 The NAFTA’s provisions should complement and augment the extensive economic reforms already

under way in Mexico and provide an insurance policy against any reversion to past

protectionist and interventionist policies that impeded US trade with Mexico. 17 As

a result, a prosperous Mexico would become a thriving market for U.S. exports. 18 NAFTA reinforces ongoing Mexican trade and investment reforms 19 , which along with reforms

in Mexican laws relating to intellectual property rights have generated substantial new opportunities for U.S. firms. The United States has long championed a Pan American vision of a liberal, democratic, capitalist hemisphere based on precepts long held to be sacrosanct among its public 20 and private

leaders. Integrating North and South America or at least bringing them closer together meant allowing for a substantial role in Latin America for U.S. power and policy. For the United States, organizing a RIA in North America was a strategy more than an ultimate goal. Befitting its global status, it had a more ambitious agenda for the world economy beyond its own neighborhood. The United States pursued two tracks in economic regionalism during the waning years of the twentieth century. One was a North American or

continental track. The second track is Pan American. As a unipolar region, North America had unique advantages; its hegemonic structure made NAFTA an obvious first step for a free trade area. After NAFTA, trade dependence and other economic relations are greater than before. The steep concessions that Mexico had to make to gain admittance to this exclusive North American club were palatable to most Mexicans because the two highly interdependent economies made structure and policy more congruent. 21 The same is not true of the hemisphere in general. 22 During the mid-1990s, the United States entertained

the view that NAFTA would be the vehicle for the more ambitious project of building a RIA for the entire hemisphere. It did not quite work out that way. The idea was to widen or broaden NAFTA by including new members through the accession clause 23 , but NAFTA did not expand. 24 NAFTA was bereft of support as the vehicle for creating a FTAA 25 . While structural power is important, so too are two other elements of power: the soft power of economic liberalism and

the use of leadership to affect outcomes. U.S. influence depends partially upon an inter-American convergence around liberal market ideas and trade policy preferences of the United States. In other words, if Latin American leaders agree with the United States on the principles and disciplines it advocates in the FTAA process, U.S. dominance is more assured. The ultimate goal of U.S. is that the nations will converge around political and economic liberalization. 26 Especially, in the wake of the terrorist acts of September 11, Iraq War and thus increasing sociotropic threat 27 and patriotism in different

countries, the American foreign policy in NAFTA become more important in preserving the support of its neighbors and indirectly of the entire world. U.S. should change the context of NAFTA from mere a free trade area to a union with a Social Charter characteristic. NAFTA should better use a regime of fair and peaceful competition, through

positive integration and institution building strategies. 28 U.S should emphasize the social quality

aspects of NAFTA and help its NAFTA partners improve their economic as well as socio-political conditions to gain new allies at the same level in the world arena. The improvement of the rule of law and democracy should not be left in the hands of U.S., but they should be realized by institutionalization 29 taking the E.U as a model. 30 Taking all these

arguments into consideration, the NAFTA’ s success will not only shape North America’s faith,

but also the future of the U.S influence on world politics as a superpower.

NAFTA is used by U.S. to some extent as a model 31 and a vehicle to maintain its superpower role throughout the world . U.S. is given the opportunity to compete with the European Union and China, the most potential emerging power, by exploiting Mexico’s cheap labor force and Canada’s natural resources. The strategic policies and actions will determine its

NAFTA partners’ position against U.S. They will either lead to stronger strategic alliances

between these countries, even including other Latin American counties, which will enhance the U.S. dominance or lead to an opposition in Mexico and Canada, which could mean the loss of its

superpower role. NAFTA’s future will play an important role; the success can help U.S. sustain its superpower role, but failure , such faced by U.S. in the

FTAA, can lead to a loss of this power, thus being a follower of E.U. in the world economy and politics it would be sufficient for U.S.

Heg is key to global stability and accesses every major impact – Prevents Great Power WarThayer, 6, Professor of Strategic Studies – Associate Professor of Defense and Strategic Study @ Missouri State University, Former Research Fellow @ International Security Program @ Harvard Belfer Center of Science and International Affairs (Bradley, “In Defense of Primacy,” The National Interest, November/December)

A grand strategy based on American primacy means ensuring the United States stays the world's number one power -the diplomatic, economic and military leader. Those arguing against primacy claim that the United States should retrench, either because the United States lacks the power to maintain its primacy and should withdraw from its global commitments, or because the maintenance of primacy will lead the United States into the trap of "imperial overstretch." In the previous issue of The National Interest, Christopher Layne warned of these dangers of primacy and called for retrenchment.1 Those arguing for a grand strategy of retrenchment are a diverse lot. They include isolationists, who want no foreign military commitments; selective engagers, who want U.S. military commitments to centers of economic might; and offshore balancers, who want a modified form of selective engagement that would have the United States abandon its landpower presence abroad in favor of relying on airpower and seapower to defend its interests. But

retrenchment, in any of its guises, must be avoided. If the United States adopted such a strategy, it would be a

profound strategic mistake that would lead to far greater instability and war in the world, imperil American security and deny the United States and its allies the benefits of primacy. There are two critical issues in any discussion of America's grand strategy: Can America remain the dominant state? Should it strive to do this? America can remain dominant due to its prodigious military, economic and soft power capabilities. The totality of that equation of power answers the first issue. The United States has overwhelming military capabilities and wealth in comparison to other states or likely potential alliances. Barring some disaster or tremendous folly, that will remain the case for the foreseeable future. With few exceptions, even those who advocate retrenchment acknowledge this. So the debate revolves around the desirability of maintaining American primacy. Proponents of retrenchment focus a great deal on the costs of U.S. action but they fall to realize what is good about American primacy. The price and risks of primacy are reported in newspapers every day; the benefits that stem from it are not. A GRAND strategy of ensuring

American primacy takes as its starting point the protec tion of the U.S.

homeland and American global interests. These interests include ensuring that critical resources like oil flow around the world, that the global trade and monetary regimes flourish and that Washington's worldwide network of allies is reassured and protected. Allies are a great asset to the United States, in part because they shoulder some of its burdens. Thus, it is no surprise to see NATO in Afghanistan or the Australians in East Timor. In contrast, a strategy based on retrenchment will not be able to achieve these fundamental objectives of

the United States. Indeed, retrenchment will make the United States less secure than the present grand strategy of primacy. This is because threats will exist no mat ter what role America chooses to play in international politics. Washington cannot call a "time out", and it

cannot hide from threats. Whether they are terror ists, rogue states or rising powers, history shows that threats must be confront ed. Simply by declaring that the United

States is "going home", thus abandoning its commitments or making unconvincing half-pledges to

defend its interests and allies, does not mean that others will respect American wishes to retreat. To make such a declaration implies weak ness and emboldens aggression. In the anarchic world of the animal kingdom, predators prefer to eat the weak rather than confront the strong. The same is true of the anarchic world of international politics. If there is no diplomatic solution to the threats that confront the United States, then the conventional and strategic military power of the United States is what protects the country from such threats. And when enemies must be confronted, a strategy based on primacy focuses on engaging enemies overseas, away from .American soil. Indeed, a key tenet of the Bush Doctrine is to attack terrorists far from America's shores and not to wait while they use bases in other countries to plan and train for attacks against the United States itself. This requires a physical, on-the-ground presence

that cannot be achieved by offshore balancing. Indeed, as Barry Posen has noted, U.S. primacy is secured because America, at present, commands the "global common"--the oceans, the world's airspace and outer space-allowing the United States to project its power far from its borders, while denying those common avenues to its enemies. As a consequence, the costs of power projection for the United States and its allies are reduced, and the robustness of the United States' conventional and strategic deterrent capabilities is increased.' This is not an advantage that should be

relinquished lightly. A remarkable fact about international politics today--in a world where Ameri can primacy is clearly and unambiguously on display--is that countries want to align themselves with the United States. Of course, this is not out of any sense of altruism, in most

cases, but because doing so allows them to use the power of the United States for their own purposes, their own protection, or to gain greater influence. Of 192 countries, 84 are allied with America--their security is tied to the United States through treaties and other informal arrangements-and they include almost all of the major economic and military powers. That is a ratio of almost 17 to one (85 to five), and a big change from the Cold War when the ratio was about 1.8 to one of states aligned with the United

States versus the Soviet Union. Never before in its history has this country, or any country, had so many allies. U.S. primacy - -and the bandwagon ing effect - has also given us extensive in - fluence in international politics, allowing the United States to shape the behavior of states and international

institutions. Such influence comes in many forms, one of which is America's ability to cre ate coalitions of like - minded states to free Kosovo, stabilize Afghanistan, invade Iraq or to stop proliferation through the Proliferation Security Initiative (PSI). Doing so allows the United States to operate with allies outside of the where it can be stymied by opponents. American-led wars in Kosovo, Afghanistan and Iraq stand in contrast to the UN's inability to save the people of Darfur or even to conduct any military campaign to realize the goals of its charter. The quiet effec -tiveness of the PSI in dismantling Libya's WMD programs and unraveling the A. Q. Khan proliferation network are in sharp relief to the typically toothless attempts by the UN to halt proliferation. You can count with one hand coun tries opposed to the United States. They are the "Gang of Five": China, Cuba, Iran, North Korea and Venezeula. Of course, countries like India, for example, do not agree with all policy choices made by the United States, such as toward Iran, but New Delhi is friendly to Washington. Only the "Gang of Five" may be expected to consistently resist the agenda and actions of the United States. China is clearly the most important of these states because it is a rising great power. But even Beijing is intimidated by the United States and refrains from openly challenging U.S. power. China proclaims that it will, if necessary, resort to other mechanisms of challenging the United States, including asymmetric strategies such as targeting communication and intelligence satellites upon which the United States depends. But China may not be confident those strategies would work, and so it is likely to refrain from testing the United States directly for the foreseeable future because China's power benefits, as we shall see, from the international order U.S. primacy creates. The other states are far weaker than China. For three of the "Gang of Five" cases --Venezuela, Iran, Cuba-it is an anti-U.S. regime that is the source of the problem; the country itself is not intrinsically anti-American. Indeed, a change of regime in Caracas, Tehran or Havana could very well reorient relations. THROUGHOUT HISTORY, peace and stability have been great benefits of an era where there was a dominant power--Rome, Britain or the United States today. Scholars and statesmen have long recognized the irenic effect of power on the anarchic world of international

politics. Everything we think of when we consider the current international order - free trade, a robust monetary regime, increasing respect for human rights, growing de - mocratization - - is directly linked to U.S. power. Retrenchment proponents seem to think that the current system can be maintained without the current amount of U.S. power behind it. In that they are

dead wrong and need to be reminded of one of history's most significant lessons: Appalling things happen when international orders collapse. The Dark Ages fol lowed Rome's collapse. Hitler succeeded the order established at Versailles. With out U.S. power, the liberal order created by the United States will end just as assuredly. As country and western great Rai Donner sang: "You don't know what you've got (until you lose it)." Consequently, it is important to note what those good things are. In addition to ensuring the security of the United

States and its allies, American primacy within the international system causes many positive outcomes for

Washington and the world. The first has been a more peaceful world. During the Cold War, U.S. leadership reduced friction among many states that were historical antagonists, most notably France and West Germany. Today, American primacy helps keep a number of complicated relationships aligned--

between Greece and Turkey, Israel and Egypt, South Korea and Japan, India and

Pakistan, Indonesia and Australia. This is not to say it fulfills Woodrow Wilson's vision of

ending all war. Wars still occur where Washington's interests are not seriously threatened, such as in Darfur, but a

Pax Americana does reduce war's likelihood, particularly war's worst form:

great power wars. Second, American power gives the United States the ability to spread de mocracy and other elements of its ideology of liberalism. Doing so is a source of much good for the countries concerned as well as the United States because, as John Owen noted on these pages in the Spring 2006 issue, liberal democracies are more likely to align with the United States and be sympathetic to the American

worldview.3 So, spreading democracy helps maintain U.S. primacy. In addition, once states are governed democratically, the likelihood of any type of conflict is significantly reduced. This is not because democracies do not have clashing interests. Indeed they do.

Rather, it is because they are more open, more transparent and more likely to want to resolve things amicably in concurrence with U.S. lead ership . And so, in general, democratic states are good for their citizens as well as for advancing the interests of the United States. Critics have faulted the Bush Administration for attempting to spread democracy in the Middle East, labeling such an effort a modern form of tilting at windmills. It is the obligation of Bush's critics to explain why democracy is good enough for Western states but not for the rest, and, one gathers from the argument, should not even be attempted. Of course, whether democracy in the Middle East will have a peaceful or stabilizing influence on America's interests in the short run is open to question. Perhaps democratic Arab states would be more opposed to Israel, but nonetheless, their people would be better off. The United States has brought democracy to Afghanistan, where 8.5 million Afghans, 40 percent of them women, voted in a critical October 2004 election, even though remnant Taliban forces threatened them. The first free elections were held in Iraq in January 2005. It was the military power of the United States that put Iraq on the path to democracy. Washington fostered democratic governments in Europe, Latin America, Asia and the Caucasus. Now even the Middle East is increasingly democratic. They may not yet look like Western-style democracies, but democratic progress has been made in Algeria, Morocco, Lebanon, Iraq, Kuwait, the Palestinian Authority and Egypt. By all accounts, the march of democracy has been impressive. Third, along with the growth in the number of democratic states around the world has been the growth of the global economy. With its allies, the United States has labored to create an economically liberal worldwide network characterized by free trade and commerce, respect for international

property rights, and mobility of capital and labor markets. The economic stability and prosperity that stems from this economic order is a global public good from which all states benefit, particularly the poorest states in the Third World. The United States created this network not out of altruism but for the benefit and the economic well-being of America. This economic order forces American industries to be competitive, maximizes efficiencies and growth, and benefits defense as well because the size of the economy makes the defense burden manageable. Economic spin-offs foster the development of military technology, helping to ensure military prowess. Perhaps the greatest testament to the benefits of the economic network comes from Deepak Lal, a former Indian foreign service diplomat and researcher at the World Bank, who started his career confident in the socialist ideology of post-independence India. Abandoning the positions of his youth, Lal now recognizes that the only way to bring relief to desperately poor countries

of the Third World is through the adoption of free market economic policies and globaliza - tion, which are facilitated through Amer ican primacy .4 As a witness to the failed alternative economic systems, Lal is one of the strongest academic proponents of American primacy due to the economic prosperity it provides.

Protectionism will cause global wars – risks extinctionPanzner 8 – faculty at the New York Institute of Finance, 25-year veteran of the global stock, bond, and currency markets who has worked in New York and London for HSBC, Soros Funds, ABN Amro, Dresdner Bank, and JPMorgan Chase (Michael, “Financial Armageddon: Protect Your Future from Economic Collapse,” p. 136-138)

Continuing calls for curbs on the flow of finance and trade will inspire the United States and other

nations to spew forth protectionist legislation like the notorious Smoot-Hawley bill. Introduced at the start of the Great Depression, it triggered a series of tit-for-tat economic responses, which many commentators believe helped turn a serious economic downturn into a prolonged and devastating global disaster. But if history is any guide, those lessons will have been long forgotten during the next collapse. Eventually, fed by a mood of desperation and growing public anger, restrictions on trade, finance, investment, and immigration will almost certainly intensify. Authorities and ordinary citizens will likely scrutinize the cross-border movement of Americans and outsiders alike, and lawmakers may even call for a general crackdown on nonessential travel. Meanwhile, many nations will make transporting or sending funds to other countries exceedingly difficult. As desperate officials try to limit the fallout from decades of ill-conceived, corrupt, and reckless policies, they will introduce controls on foreign exchange. Foreign individuals and companies seeking to acquire certain American infrastructure assets, or trying to buy property and other assets on the cheap thanks to a rapidly depreciating dollar, will be stymied by limits on investment by noncitizens. Those efforts will cause spasms to ripple across economies and markets, disrupting global payment, settlement, and clearing mechanisms. All of this will, of course, continue to undermine business confidence and consumer spending. In a world of lockouts and lockdowns, any link that transmits systemic financial pressures across markets through arbitrage or portfolio-based risk management, or that allows diseases to be easily spread from one country to the next by tourists and wildlife, or that otherwise facilitates unwelcome exchanges of any kind will be viewed with suspicion and dealt with

accordingly. The rise in isolationism and protectionism will bring about ever more heated arguments and

dangerous confrontations over shared sources of oil, gas, and other key commodities as well as factors of production that must, out of necessity, be acquired from less-than-friendly nations. Whether involving raw materials used in strategic industries or basic necessities such as food, water, and energy, efforts to secure adequate supplies will take increasing precedence in a world where demand seems constantly out of kilter with supply. Disputes over the misuse, overuse, and pollution of the environment and natural resources will become more commonplace.

Around the world, such tensions will give rise to full-scale military encounters, often

with minimal provocation. In some instances, economic conditions will serve as a convenient pretext for conflicts that stem from cultural and religious differences. Alternatively, nations may look to divert attention away from domestic problems by channeling frustration and populist sentiment toward other countries and cultures. Enabled by cheap technology and the waning threat of American retribution, terrorist groups will likely boost the frequency and

scale of their horrifying attacks, bringing the threat of random violence to a whole new level. Turbulent conditions will encourage aggressive saber rattling and interdictions by rogue nations running amok. Age-old clashes will also take on a new, more heated sense of urgency. China will likely assume an increasingly belligerent posture toward Taiwan, while Iran may embark on overt

colonization of its neighbors in the Mideast. Israel, for its part, may look to draw a dwindling list

of allies from around the world into a growing number of conflicts. Some observers, like John Mearsheimer, a political scientist at the University of Chicago, have even speculated that an “intense confrontation” between the United States and China is “inevitable” at some point. More than a few disputes will turn out to be almost

wholly ideological. Growing cultural and religious differences will be transformed from

wars of words to battles soaked in blood . Long-simmering resentments could also degenerate quickly,

spurring the basest of human instincts and triggering genocidal acts. Terrorists employing biological or nuclear weapons will vie with conventional forces using jets, cruise missiles, and bunker-busting bombs to cause widespread destruction. Many will interpret stepped-up conflicts between Muslims and Western societies as the beginnings of a new world war.

Ext - Infrastructure Solves

Current points of entry are too old to withstand current workload – investment is critical to solveWilson, 12 - Associate at the Mexico Institute of the Woodrow Wilson International Center for Scholars. (Christopher E., “The State of Trade, Competitiveness and Economic Well-being in the U.S.-Mexico Border Region,” Wilson Center Mexico Institute, June 2012, http://www.wilsoncenter.org/sites/default/files/State_of_Border_Trade_Economy_0.pdf)//AR

One of the most obvious and often cited ways to reduce congestion at the POEs is to update and expand border crossing infrastructure, and credit is certainly due to U.S. government and border communities for significant recent advances. After a decade with no new ports of entry built, three new crossings were opened in 2010: Anzalduas, San Luís II, and Donna-Rio Bravo.13 In 2011, seven new lanes were opened on the World Trade Bridge, the most important crossing point for commercial traffic between the United States and Mexico. Significant expansions are also underway at San Ysidro, the most trafficked crossing for individuals, and at Nogales Mariposa.

Despite these important advances, much work remains to be done. Average U.S. land POEs are more than forty years old, with some over seventy years old.14 Customs and Border Protection believes that “federal appropriations have not kept pace with needs,” noting $6 billion dollars of investment are needed to “fully modernize” the land ports of entry along the United

States southern and northern borders.15¶ Given the fact that POE improvements offer significant and tangible monetary benefits to border communities and trade-dependent industries, state, local and private entities are often willing to contribute funding to border infrastructure projects. Under the current budgetary constraints, it makes sense for federal agencies to take full advantage of

these alternative funding sources. Along the Texas-Mexico border, the majority of POEs are owned by the city or county in which they are located. This model for infrastructure investment could be expanded along other parts of the U.S.-Mexico border, but changes to current federal legislation appear to be necessary to allow CBP to “accept reimbursement from sources other than Congress.”16

Congestion and inefficient infrastructure erode transportation capacity at the borderUS Chamber of Commerce, 10 – American lobbying group representing the interests of many businesses and trade associations (CoC, “Steps to a 21st Century U.S.-Mexico Border,” A U.S. Chamber of Commerce Border Report, 5/19/10, http://www.uschamber.com/sites/default/files/reports/2011_us_mexico_report.pdf)//AR

Current Situation Rapid population growth along the border puts increased pressure on infrastructure at a time when government, at all levels, is dealing with inadequate revenues to deal with not only the significant backlog of maintenance but also

the significant investments necessary to create a 21st century infrastructure.¶ Moreover, growth of commercial traffic continues to overwhelm ports of entry to and from the United States and Mexico. From 1990 to 2010, U.S. exports to Mexico grew from $28 billion to $163 billion. Total trade between the United States and Mexico has expanded by more than 600% since 1990. Trucking and rail are the primary modes of transportation for products moving across the border, and both modes are hindered by inefficient infrastructure. By investing in border infrastructure, goods, services, and people will be able to

move more efficiently, therefore decreasing the costs of doing business. Congestion and inefficient infrastructure produce uncertainty, unreliability, and high costs for international shippers. According to SANDAG, the Otay-Mesa Port of Entry, the largest commercial crossing on the California- Mexico border, is only connected to the highway system through local roads, with volumes reaching more than 55,000 vehicles daily.¶ iii Furthermore,

inadequate capacity at border crossings is costing local economies dearly. According to SANDAG, congestion and delays at border crossings between San Diego County and Baja California cost the U.S. and Mexican economies an estimated $7.2 billion in foregone gross output and more than 62,000 jobs in 2007. Also, the more than two-hour per truck wait time at border crossings in San Diego County cost the local economy $539 million in annual revenue from reduced freight activity, translating to more than 2,900 lost jobs and $155 million in lost labor

income in 2007. iv 19¶ Staffing and Infrastructure Increases in officers, agriculture specialists, and support staff must happen in tandem with infrastructure improvements. As an example, the Nogales West (Mariposa) Port of Entry is undergoing a $200 million reconfiguration project. However, CBP does not have the staff to operate the existing facility properly, much less when it expands by 50% in 2011 and again in 2013. At this facility alone, staffing would need to expand from the 300 CBP officers currently in place to 500

Wait times crush trade increaseUnited States Chamber of Commerce 10(United States Chamber of Commerce, “Steps to a 21st Century U.S.-Mexico Border,” 2010 http://www.uschamber.com/sites/default/files/reports/2011_us_mexico_report.pdf, RLA with PP)

Border delays have a dramatic impact on the way ¶ businesses operate. They build these costs into their ¶ companies—and pass them on to consumers—but ¶ those resources could be used more effectively. ¶ Further,

the fact that border wait times are so long ¶ hinders investment in the border region as follows:¶ •

U.S. and Mexican companies face higher ¶ transportation costs as a result of

lengthy border ¶ wait times. ¶ • Companies spend a significant amount on ¶ security to ensure that products are not ¶ intercepted by criminals.¶ • U.S. and

Mexican firms are forced to hold ¶ larger inventories to accommodate for ¶ uncertainty, increasing costs that could be ¶ invested for business development and hiring.¶ • Consumers pay higher prices for a reduced ¶ selection of goods.¶ • Time-sensitive products, such as fresh fruits and ¶

vegetables and other agricultural commodities, ¶ are put at risk due to the perishable nature of ¶ the product’s life span.

Investments in border infrastructure solve wait timesNAFTA Works 13 (NAFTA Works, “Border Infrastructure’s Key Role in Expanding U.S.-Mexico Trade,” Vol. 18 Issue 4, April 2013, http://www.naftamexico.net/wp-content/uploads/2013/05/apr13.pdf, AC)

Very few countries in the world have the potential ¶ to shape the United States’ manufacturing ¶ competitiveness as much as Mexico. It is difficult ¶ to overstate the critical importance of this strategic ¶ partnership, as trade between both countries ¶ reached roughly half a trillion dollars in 2012, ¶ maintaining Mexico’s status as the U.S.’ third ¶ largest trading partner and its second largest ¶ export market as it purchased nearly 1/8 of all ¶ U.S.

exports. The increased usage of crossborder production lines has resulted in a very ¶ unique trading partnership, where working to ¶ establish a trade facilitating border infrastructure ¶ is now crucial to successfully competing in the ¶ global market. In order to understand the true ¶

strength of this partnership, a new approach that ¶ incorporates the relevance of foreign value-added ¶ in exports is required. Consequently, one of the ¶ most distinctive factors of U.S.-Mexico trade lies ¶ in its qualitative nature. Working together to comanufacture products entails an intensive intraindustry trade of inputs rather than exclusively ¶ trading in finished products, helping to support ¶ the 6 million U.S. jobs that depend on trade with ¶ Mexico. As a result of this highly integrated ¶ production process, on average,

40% of all ¶ content in Mexican exports to the U.S. actually ¶ originates in the United States. ¶ As 82%, or $404 billion, of bilateral trade was ¶ carried across the border via surface ¶ transportation in 2012, improving the efficiency ¶ of trade flows at the U.S. southern Ports of ¶ Entry (POE) is imperative to safeguarding a ¶ regional competitive edge. Last year, over 44 ¶ million tons of food, inputs, components, and ¶ finished products crossed by land from Mexico ¶ into the U.S. to supply manufacturing plants and ¶ supermarkets alike. Far from exclusively ¶ benefiting the four Southern U.S. states ¶ bordering Mexico, a total of twenty-nine U.S. ¶ states had exports to Mexico in excess of $1 ¶

billion in 2012, making this one of the most ¶ economically significant borders in the world. ¶ Continues on page 2 ¶ Additionally, some twenty-three U.S. ¶ states depended on Mexico as their ¶ No. 1 and No. 2 largest export market ¶ in 2012, with states as far north as ¶ Michigan exporting over $10 billion. ¶ This illustrates that even states’ local ¶ economies that are far from the ¶ southern border are also major ¶

stakeholders when it comes to ¶ building a seamless, long haul border ¶ infrastructure that is capable of ¶

minimizing cross-border business ¶ costs. ¶ Of the 26 POEs along the southern ¶ border that collectively handled more ¶ than $1.3 billion in bilateral trade each day in 2012 - virtually all of it tariff free - the largest by far is the ¶ Port of Laredo in Texas. This critical POE facilitated more than ¶ 3.5 million cross-border commercial truck shipments, and over ¶ 500 thousand rail-boxes via railway in both directions, carrying ¶ more than $163 billion in goods in 2012 or 35% of all bilateral ¶ trade. Considering that forty U.S. states spread across the ¶ country use Laredo as their primary POE, this port could truly be ¶

considered the U.S.’ main artery for bilateral trade with Mexico. ¶ Last year alone, more than $76 billion in U.S. exports to Mexico ¶ and $86 billion in imported Mexican goods went through the ¶ Laredo POE. ¶

Another strategic POE is El Paso, which had 13% of all U.S.-¶ Mexico trade pass through in 2012. With over $66 billion in goods ¶ being traded here, it is the second busiest port for bilateral trade. ¶ As an example of its relevance, El Paso is the second largest ¶ POE for U.S. electrical machinery exports to Mexico, as it was ¶

responsible for the timely crossing of 26% of this vital industry’s ¶ exports. Along the western side of the border, Otay Mesa is the ¶ U.S.’ third largest POE for bilateral trade with Mexico, which had ¶ more than $35 billion of goods move through this facility in 2012. ¶ An astonishing 99% of trade between California and Mexico is ¶ conducted by trucks, therefore ensuring that the state’s busiest ¶ commercial truck crossing operates at maximum efficiency is ¶ critically important. ¶ In order to enhance and also secure regional competitiveness, the ¶ strength of both countries’ industrial capabilities lies in the joint ¶ effort to

minimize the logistical costs placed on regional ¶ manufactures. By expanding and modernizing the current border ¶ infrastructure, both countries

promote a world-class logistical ¶ capability that improves border wait times, customs procedures, ¶ and trusted traveler or shipper programs. As a result, both ¶ countries are working together through the 21st Century Border ¶

Initiative to address shared challenges. Progress has been ¶ achieved over the past three years that has helped to facilitate the ¶ secure and efficient flow of goods and people along the border. ¶ Three new international bridges, one in Arizona and the other two ¶ in Texas, were constructed to support this growing demand. ¶ Becoming operational in 2009, the Anzalduas International Bridge ¶ in Texas was the first new bridge to be built

The plan is key to boost trade and stimulate economic growthLee and Wilson, 12(Erik, Associate Director at the North American Center for Trans-border Studies at ASU, and Christopher E., Associate at the Mexico Institute of the Woodrow Wilson International Center for Scholars, “The State of Trade, Competitiveness, and Economic Well-being in the U.S.-Mexico Border Region,” June 2012, http://www.wilsoncenter.org/sites/default/files/State_of_Border_Trade_Economy_0.pdf, AC)

Commerce between the United States and Mexico is one of the great yet highly ¶ underappreciated success stories of the global economy.

The United States is Mexico’s top ¶ trading partner, and Mexico—which has made enormous strides in

its macroeconomic picture ¶ in the last two decades—is the U.S.’ third-ranked partner in terms of total trade. ¶ The economic vitality of the U.S.-Mexico border region—which includes manufacturing, ¶ infrastructure, human capital and tourism, among other elements—is a key part of this overall ¶ economic success. With more than a billion dollars of commercial traffic crossing the border ¶ each day, it is literally at the U.S.-Mexico border region where “the rubber hits the road” in ¶ terms of this expanded regional trade. This is because more than 70% of total binational ¶ commerce passes through the border region via trucks. This already massive truck traffic is ¶ expected to increase significantly in the coming decades (see Figure 1 below). Since the implementation of the North American Free Trade Agreement in 1994, total trade ¶ between the two countries has more than quintupled, and goods and services trade is now at a ¶ Billions of U.S. Dollars¶ Merchandise Trade Services Trade5¶ half trillion dollars per year. An estimated six million U.S. jobs and probably even more Mexican ¶ jobs depend on bilateral trade.2¶ The six Mexican and four U.S. border states have especially close bilateral economic ties, but ¶ what is often unappreciated is that this economic value extends far beyond the border region. ¶ Mexico, for example, is the top buyer of exports from states as far away as New Hampshire ¶ (mostly computers and electronics). In fact, Mexico is the first or second most important export ¶ market for twenty-one states from Colorado to Ohio, and twenty U.S. states sell more than a ¶ billion dollars’ worth of goods to Mexico each year. The United States in an even more ¶ important market for Mexican exports. Seventy-nine percent of Mexican exports are sold to the ¶ United

States, including products produced in the border region and throughout the country.3¶ Crude oil, for example, which is mostly produced in Mexico’s Gulf Coast states, is the top single ¶ export to the United States, but automobiles and auto-parts, which make up an even greater ¶ share of exports when taken together, are mainly made in the center and north of the country.4¶ The quantity of U.S.-Mexico trade is impressive, but its quality makes it unique. The United ¶ States and Mexico do not just sell goods to one another, they actually work together to ¶

manufacture them. Through a process known as production sharing, materials and parts often ¶ cross back and forth between factories on each side of the border as a final product is made ¶ and assembled. As a result, U.S. imports from Mexico contain, on average, 40 percent U.S. ¶ content, and Mexico’s imports from the U.S. also have a high level of Mexican content. 5¶ This system of joint production has two

important consequences. First, it means that our ¶ economies are profoundly linked. We tend to experience growth and recession together, and ¶ productivity gains or losses on one side of the border generally cause a corresponding gain or ¶ loss in competitiveness on the other side as well. In sum, we will largely succeed or fail together ¶ and must therefore join forces to increase the competitiveness of the region. Second, the fact ¶ that goods often cross the border several times as they are being produced creates a multiplier ¶ effect for gains and losses in border efficiency. Whereas goods from China only go through ¶ customs and inspection once as they enter the U.S. or Mexico, products built by regional ¶ manufacturers bear the costs of long and

unpredictable border wait times and significant ¶ customs requirements each time they cross the U.S.-Mexico border. Leading industrial sectors in U.S.-Mexico trade include automobiles, aerospace, and home ¶ appliances, and medical devices, to name but a few. We often find extremely high-skilled labor ¶ involved in complex aspects of U.S.-Mexico trade, including custom parts metal work, products ¶ requiring skilled labor. These processes often link designers, developers, raw materials ¶ producers and parts manufacturers in the United States to high skilled labor, engineers, and ¶ plant managers in Mexico. While in truth both countries participate in all parts of the supply ¶ chain depending on the product, these are some broad characteristics that often hold true for ¶ which parts of the manufacturing process each country specializes in.¶ In addition to manufactured goods, agricultural products also flow between the two countries. ¶ This includes U.S. exports of food products (grains and processed foods) from states such as¶ South Dakota, Nebraska, and Iowa, as well as Mexican fruit and vegetable exports from key ¶ states such as Sinaloa and Michoacán. ¶ As a final point to introduce this macro view of U.S.-

Mexico trade, it must be emphasized that ¶ this trade relationship requires major infrastructure to function effectively. The largest trade ¶ corridor, often referred to as the NASCO corridor, links central and eastern Mexico to Texas, the ¶ American Midwest, Northeast, and Ontario, utilizing the key Laredo-Nuevo Laredo ports of ¶ entry (POEs). Other important trade arteries include the CANAMEX Corridor, which connects ¶ western Mexico to the intermountain United States and Canadian province of Alberta, as well ¶ as the shorter but high-

volume I-5 corridor connecting California to Baja California. As the ¶ economies of both the U.S. and Mexico grow, it is likely that this network of freight ¶ transportation infrastructure—and the land ports of entry that serve as nodes in this network—¶ will experience added stress (see Figure 2 on the next page).

Infrastructure investment in the region is key to the North American EconomySands, 10 - Senior Fellow at The Hudson Institute (Christopher E., “If You Don't Plan, Plan to Fail,” Center for Strategic and International Studies, 6/18/2010, http://csis.org/blog/if-you-dont-plan-plan-fail)//AR

It is not a surprise that Canadians and Mexicans are concerned about North American transportation infrastructure. For each country, the United States is

their largest export market, accounting for roughly three-quarters of their exports.

And while governments in Canada and Mexico have invested billions in recent years to improve infrastructure connecting to the United States, by virtue of its central location,

Canadians and Mexicans must rely on U.S. investments in infrastructure to complete the connection.¶ That does not suggest that U.S. investments in infrastructure, both public and private and sometimes both, are for the benefit of

Canadians and Mexicans. In fact, Canada and Mexico are the largest export markets for U.S. companies as well, and Canadians and Mexicans like U.S. products and brands. China has been growing rapidly as a U.S. trading partner, but the relationship flows mainly in one direction: U.S. consumers buy Chinese products, but Chinese consumers do not buy much from the United States.

Ext - Energy Cooperation

Plan increases trade, solves energy security and energy cooperationSelee and Wilson 12 (Andrew Selee and Christopher Wilson, Andrew, Vice President for Programs and Senior Advisor to the Mexico Institute at the Wilson Center, Christopher, associate with the Mexico Institute, “A New Agenda With Mexico,” Wilson Center, November 2012, http://www.wilsoncenter.org/sites/default/files/a_new_agenda_with_mexico.pdf, AC)

With the economies of North America deeply ¶ linked, growth in one country benefits the others, ¶ and lowering the transaction costs of goods crossing ¶ the common borders among these three countries ¶ helps put money in the pockets of both workers ¶ and consumers. Improving

border ports of entry is ¶ critical to achieving this and will require moderate ¶ investments in infrastructure and staffing, as well as ¶ the use of new risk management techniques and ¶ the expansion of pre-inspection and trusted shipper ¶

programs to speed up border crossing times. Transportation costs could be further lowered — and ¶ competitiveness further strengthened — by pursuing ¶ an Open Skies agreement and making permanent ¶ the cross-border trucking pilot program. While ¶ these are generally seen as border issues, the benefits accrue to all U.S. states that depend on exports ¶ and joint manufacturing with

Mexico, including ¶ Michigan, Ohio, Nebraska, Iowa, South Dakota, New ¶ Hampshire, and Georgia, to name just a few.¶ Mexico also has both abundant oil reserves and ¶ one of the largest stocks of shale gas in the world. ¶ The country will probably pursue a major energy ¶ reform over the next couple years that could spur ¶ oil and gas production, which has been declining ¶ over the past decade. If that happens, it is

certain ¶ to detonate a cycle of investment in the Mexican ¶ economy,

could significantly contribute to North ¶ American energy security, and may open a space for ¶ North American discussions about deepened energy ¶ cooperation

Ext – Small Businesses

Infrastructure is key to competitiveness – specifically in small and medium sized businessesUnited States Chamber of Commerce 10(United States Chamber of Commerce, “Steps to a 21st Century U.S.-Mexico Border,” 2010 http://www.uschamber.com/sites/default/files/reports/2011_us_mexico_report.pdf, RLA)

Trade between the United States and Mexico creates ¶ and supports jobs for millions of Americans and ¶

Mexicans. In 2010, 13% of all U.S. exports were ¶ destined to Mexican markets. Overall, nearly ¶ 31 million American jobs are supported by trade. ¶ That translates into more than one in every five U.S. ¶ jobs linked to the import and export of goods and ¶ services. Furthermore, exports generated nearly half ¶ of U.S. economic growth in 2010, adding well over a ¶ percentage point to GDP growth. ¶ The U.S. manufacturing industry depends on ¶ NAFTA, sending more than half of its exports to ¶ either Canada or Mexico. Since NAFTA began, ¶ U.S. manufacturers have boosted their output by ¶ more than 50%. Contrary to popular belief, 97% of ¶ all exporters are small and medium-size businesses. ¶ Considering that these same

companies create the ¶ vast majority of job growth, it is imperative to ¶ improve their ability to compete in global markets. ¶ Despite the significance of the U.S.-Mexico ¶ relationship, delays and other inefficiencies at the ¶ border erode much of the competitive advantage ¶ that was accrued from NAFTA. According to ¶ SANDAG, congestion and delays at border crossings ¶ between San Diego County and Baja California cost ¶ the U.S. and Mexican economies an estimated ¶ $7.2 billion in foregone gross output and more than ¶ 62,000 jobs in 2007.

Ext – Solves Trade

Infrastructure investment facilitates tradeRozental et al 10 (Andrés Rozental,¶ Former Deputy Foreign Minister of ¶ Mexico; Former President and Founder ¶ Mexican Council on Foreign Relations ¶ (COMEXI), Robert C. Bonner, Former Commissioner of U.S. Customs and Border Protection; Former Administrator, Drug Enforcement Administration, Chappell Lawson, Associate Professor of Political Science, Massachusetts Institute of Technology; Adjunct Fellow, Pacific Council on International Policy , “Managing the United States-Mexico Border: ¶ Cooperative Solutions to Common Challenges,” 2010 http://www.pacificcouncil.org/document.doc?id=30, RLA)

Congestion at crossing points imposes considerable costs on tourists, commuters, ¶ consumers, business owners, and border communities; the financial price alone of ¶ delays at the border reaches billions of dollars per year. In some areas along the ¶ border, including the San Diego-Tijuana corridor, expediting cross-border commerce is ¶ the single most important measure that the governments could take to promote ¶ economic development. ¶ Although

facilitation is often viewed as the flip side of security, there are ways to ¶ simultaneously expedite trade and improve security. For instance, new detection ¶

technologies and intelligent risk management strategies enhance public safety while ¶ facilitating cross-border travel and commerce. ¶ One crucial barrier to trade facilitation is the deficit in border infrastructure, which ¶ simply has not kept pace with massive increases in trade and transit since ratification of ¶ the North A merican F ree T rade A greement. Federal spending on ports of entry would ¶ have a very high rate of return; for this reason, both countries should make a long-term ¶ commitment to fund border infrastructure and (in the short run) disproportionately ¶

direct stimulus money toward the ports of entry. ¶ Even with additional stimulus spending, however, federal funding will remain

insufficient ¶ to address the infrastructure deficit; both countries must find other sources of financing ¶ for border crossing points and the roads that feed into them. This money can come in ¶ part from the private sector, with the market rather than the state determining the ¶ magnitude of private investment in border

infrastructure. ¶ Beyond infrastructure, better exploitation of technology, refined risk-based ¶ segmentation of traffic, and operational changes at the ports of entry (including ¶ staffing) can all reduce transit time. Because the marginal cost of operating an existing ¶

port of entry is extremely low compared to both the cost of building a new port of entry ¶ and the marginal benefit of more rapid transit, inadequate staffing of the ports of entry ¶ should never become become a bottleneck. ¶ So far neither government has articulated a goal for wait times. The Task Force believes ¶ that average wait times at the border should not exceed 20 minutes in either direction, ¶ at any port of entry, with minimal variation about this average.

Ext – NAFTA Key

The plan’s exchange of goods and services is key for two reasons

a. ExportsUnited States Trade Representative 11(Office of the United States Trade Representative “North American Free Trade Agreement (NAFTA)” 2011 http://www.ustr.gov/trade-agreements/free-trade-agreements/north-american-free-trade-agreement-nafta, RLA)

The NAFTA countries (Canada and Mexico), were the top two purchasers of U.S. exports in 2010.

(Canada $248.2 billion and Mexico $163.3 billion).¶ U.S. goods exports to NAFTA in 2010 were $411.5 billion, up 23.4% ($78 billion) from 2009, and 149% from

1994 (the year prior to Uruguay Round) and up 190% from 1993 (the year prior to NAFTA). U.S. exports to NAFTA accounted for 32.2% of overall U.S. exports in 2010.¶ The top export categories (2-digit HS) in 2010 were: Machinery ($63.3

billion), Vehicles (parts) ($56.7 billion), Electrical Machinery ($56.2 billion), Mineral Fuel and Oil ($26.7 billion), and Plastic ($22.6 billion).¶ U.S. exports of agricultural products to NAFTA countries totaled $31.4 billion in 2010. Leading categories include: red meats, fresh/chilled/frozen ($2.7 billion), coarse grains ($2.2 million), fresh fruit ($1.9 billion), snack foods (excluding nuts) ($1.8 billion), and fresh vegetables ($1.7 billion).¶ U.S. exports of private commercial services* (i.e., excluding military and government) to NAFTA were $63.8 billion in 2009 (latest data available), down 7% ($4.6 billion) from 2008, but up 125% since 1994.

b. ImportsUnited States Trade Representative 11(Office of the United States Trade Representative “North American Free Trade Agreement (NAFTA)” 2011 http://www.ustr.gov/trade-agreements/free-trade-agreements/north-american-free-trade-agreement-nafta, RLA)

¶ The NAFTA countries were the second and third largest suppliers of goods imports to the United States in 2010. (Canada $276.5 billon, and Mexico $229.7 billion).¶ U.S. goods

imports from NAFTA totaled $506.1 billion in 2010, up 25.6% ($103 billion), from 2009, and up 184% from 1994, and up 235%

from 1993. U.S. imports from NAFTA accounted for 26.5% of overall U.S. imports in 2010.¶ The five largest categories in 2010 were Mineral Fuel and Oil (crude oil)

($116.2 billion), Vehicles ($86.3 billion), Electrical Machinery ($61.8 billion), Machinery ($51.2 billion), and

Precious Stones (gold) ($13.9).¶ U.S. imports of agricultural products from NAFTA countries totaled $29.8 billion in 2010. Leading categories include: fresh vegetables ($4.6 billion), snack foods, (including

chocolate) ($4.0 billion), fresh fruit (excluding bananas) ($2.4 billion), live animals ($2.0 billion), and red meats, fresh/chilled/frozen ($2.0 billion).¶ U.S. imports of private commercial services* (i.e., excluding military and government) were $35.5 billion in 2009 (latest data available), down 11.2% ($4.5 billion) from 2008, but up 100% since 1994.

AT: NAFTA Bad

AT: NAFTA Bad – Overview

NAFTA is awesome – your evidence is hype Lustig, 12 - PhD in Economics from the University of California at Berkeley, President of the Universidad de las Américas-Puebla, Senior Advisor and Chief of the Poverty and Inequality Unit, Department of Social Programs and Sustainable Development at the Inter-American Development Bank Director of the 2000/2001 World Development Report (Nora C., “NAFTA: Setting the Record Straight” 2012 Updated, http://www2.econ.iastate.edu/classes/econ455/lapan/Readings/NAFTA,%20Setting%20the%20Record%20Straight.pdf)//

Has NAFTA failed? The short answer is no. Though it will take many more years before a

meaningful assessment of the agreement can be made, NAFTA's expected benefits are beginning to materialize. Trade among the three NAFTA countries has been expanding to record levels , and the number of U.S.-Mexican business partnerships is on the rise. Moreover, despite the 45 percent real devaluation of the peso, the 7 percent drop in Mexican output, and Mexico's 22 percent fall in real wages during

1995, U.S. exports to Mexico were much less affected than Japanese or European exports, largely due to NAFTA. Indeed, while exports to Mexico from the

rest of the world (notably Japan and the European Union) fell by about 25 percent, U.S. exports contracted by less than 2 percent . Despite these positive trends, many Americans within Congress and outside it are proclaiming that

NAFTA was a mistake. To a large extent, the statements against NAFTA are based on erroneous beliefs or egregious distortions. NAFTA is blamed for U.S. job losses or declining living standards of workers, particularly among

unskilled persons. In reality, the impact of NAFTA on gross job displacement in the United States has been negligible . Furthermore, there is some evidence that the net employment effect (the difference between jobs displaced and

jobs created) has been positive . Another argument used against NAFTA is the fact that following the Mexican peso crisis the United States is running a trade deficit with Mexico. However, unless it is the

result of restrictions in market access, a deficit with any one country is by no means a cause of distress in the country running the deficit. NAFTA's success must be measured by the total amount of trade it creates, regardless of which country is in

deficit. Finally, though some of NAFTA's critics argue that the agreement was a cause of the Mexican peso crisis, in reality the crisis was caused by factors unrelated to NAFTA. In fact, NAFTA is an important contributing factor to Mexico's economic recovery because of its impact on export performance and foreign direct investment flows.

Their indicts are wrong and more integration solvesPastor, 04 – Robert A., Robert A., Professor at and Founding Director of the Center for North American Studies at American University (“North America's Second Decade,” Foreign Affairs, Jan/Feb 2004)

A FIRST DRAFT The North American Free Trade Agreement (NAFTA) went into effect on January 1, 1994,

amid fears of job loss in the United States and cries of revolution in the south of Mexico. Yet, in a single decade, the three nations of North America have built a market larger than, and almost as integrated as, the 15-nation European Union.

Trade and investment have nearly tripled, and the United States, Mexico, and Canada have experienced an unprecedented degree of social and economic integration. For the first time, "North America" is more than just a geographical expression. In 2000, the election victories of George W. Bush, Vicente Fox, and Jean Chretien raised hopes still further that the promise of a trilateral partnership might be fulfilled. Four years later, however, relations among the three governments have deteriorated. No leader refers to "North America" in the way that Europeans speak of their continent. Indeed, anti-NAFTA name-calling has surfaced again in debates among U.S.

presidential candidates. After ten years, it is time to evaluate what NAFTA has accomplished and where it has failed and to determine where it should go from here. What should be the goals for North America's second decade, and what must

North American leaders do to achieve them? NAFTA was merely the first draft of an economic constitution for North America. It was a deliberately lean document, intended only to dismantle barriers to trade and investment. Its

architects planned neither for its success nor for the crises that would confront it. Although NAFTA fueled the train of continental integration, it did not provide conductors to guide it. As a result, two setbacks -- the Mexican peso crisis of 1995 and the terrorist attacks of September 11, 2001 --

have threatened to derail the integration experiment. The peso crisis was a blow to the Mexican economy and to U.S. and Canadian faith in integration. NAFTA's authors had assumed that eliminating restrictions on the movement of capital and goods would, by dint of the market's magic, lead to unalloyed prosperity. No clause in the agreement established a mechanism to anticipate or respond to market failures. Whereas the EU had created too many intrusive institutions, North America made the opposite mistake: it created almost none. The second shock to the North American body politic occurred on September 11, 2001. If a true partnership had existed, the leaders of the United States, Mexico, and Canada would have met in Washington in the days after the tragedy to declare that the attack was aimed at all of North America and that they would respond as one. Instead, in the absence of common institutions, the governments reverted to old habits. Acting unilaterally, Washington virtually closed its borders; Mexican and Canadian leaders responded ambivalently, afraid of how the angry superpower would react. Both events signify missed opportunities. The establishment of the U.S. Department of Homeland Security places North America once again at a crossroads. One course -- the more likely one -- would strengthen border enforcement and impede movement, even by friends. Trade and investment would decline, tensions would rise, and the myriad benefits of integration would begin to recede. In an alternative course, however, security fears would serve as a catalyst for deeper integration. That would require new structures to assure mutual security, promote trade, and bring Mexico closer to the First World economies of its neighbors. Progress can occur only with true leadership, new cooperative institutions, and a redefinition of security that puts the United States, Mexico, and Canada inside a continental perimeter, working

together as partners. EVALUATING NAFTA From its outset, NAFTA was subjected to blistering criticism, often based on outlandish predictions. U.S. presidential candidate Ross Perot warned of a "giant sucking sound" -- jobs leaving the United States for Mexico. Mexicans and Canadians, meanwhile, feared that their economies would be taken over by U.S. companies. Opponents predicted that free trade

would erode environmental and labor standards in the United States and Canada. Few of these prophecies have been borne out. The United States experienced the largest job expansion in its history in the 1990s. Although both Mexico and Canada attracted considerable new U.S. investment (since NAFTA gave them privileged access to the U.S. market), the percentage of U.S.-

owned companies in each country did not increase. (In fact, Canadian investment in the United States

grew even faster than did U.S. investment in Canada.) In Mexico, income disparity did worsen, but only because those regions that do not trade with the U nited

States grew much more slowly than those that do; the problem was not NAFTA, but its absence. Environmental standards in Mexico have actually

improved faster than those in Canada and the United States, and Mexico's 2000 election was universally hailed as free and fair. And although Mexico and Canada became more dependent on the U.S. market, as opponents of integration warned, the reverse also happened: U.S. trade with its neighbors grew roughly twice as fast as did its trade with the rest of the world. By 2000, in fact, the United States imported 36 percent of its energy from its most important trading partners -- Canada and Mexico -- and exports to its neighbors were 350 percent greater than exports to Japan and China

and 75 percent greater than exports to the EU. So much has been attributed to NAFTA that it is easy to forget that it was simply an agreement to dismantle most restrictions on trade and investment over the course of ten years. With a few notable exceptions -- such as trucking, softwood, lumber, and

sugar -- where U.S. economic interests have prevented compliance, the agreement largely succeeded in what it was intended to do: barriers were eliminated, and trade and investment soared. In the 1990s, U.S. exports to Mexico grew fourfold, from $28 billion to $111 billion, and exports to

Canada more than doubled, increasing from $84 billion to $179 billion. Annual flows of U.S. direct investment to Mexico, meanwhile, went from $1.3 billion in 1992 to $15 billion in 2001. U.S. investment in Canada increased from $2 billion in 1994 to $16 billion in

2000; Canadian investment flows to the United States grew from $4.6 billion to $27 billion over the same period. Travel and immigration among the three countries also increased dramatically. In 2000 alone, people crossed the two borders 500 million times. The most profound impact came from those people who crossed and stayed. The 2000 census estimated that there were 22 million people of Mexican origin in the United States, about 5 million of whom were undocumented workers. Nearly two-thirds of these have arrived in the last two decades. North America is larger than Europe in population and territory, and its gross product of $11.4 trillion not only eclipses that of the EU (and will even after the EU expands to 25 nations in May 2004) but also represents one-third of the world's economic output. Intraregional exports as a percentage of total exports climbed from around 30 percent in 1982 to 56 percent in 2001 (compared to 61 percent for the EU). As in the

auto industry -- which makes up nearly 40 percent of North American trade -- much of this exchange is either

intraindustry or intrafirm. Both industries and companies have become truly North American. But although NAFTA has successfully increased trade and investment, it has failed to confront some of the major challenges of integration. This failure has not only harmed the three countries, it has also seriously undermined support for the

agreement, thus preventing North America from seizing opportunities for further progress. First, NAFTA was silent on the development gap between Mexico and its two northern neighbors, and

that gap has widened. Second, NAFTA did not plan for success: inadequate roads and infrastructure cannot cope with increased traffic. The resulting delays have raised the transaction costs of regional trade more than the elimination of tariffs has lowered them. Third, NAFTA did not address immigration, and the number of undocumented workers in the United States jumped in the 1990s from 3 million to 9 million (55 percent of whom came from Mexico). Fourth, NAFTA did not address energy issues, a failure highlighted by the catastrophic blackout that Canada and the northeastern United States suffered last August. Fifth, NAFTA made no attempt to coordinate macroeconomic policy, leaving North American governments with no way to prevent market catastrophes such as the Mexican peso crisis. Finally, NAFTA did nothing to address security -- and as a result, the fallout from September 11 threatens to cripple North American integration.

AT: NAFTA Bad – US Jobs

The majority of economists conclude aff – job losses are structural not NAFTATeslik, 9 - bachelor's degree from Harvard University and an MBA from INSEAD, senior editor and commodities analyst at Roubini Global Economics, associate editor of economics for the Council on Foreign Relations, (Lee Hudson, “NAFTA's Economic Impact”, July 7, 2009 http://www.cfr.org/economics/naftas-economic-impact/p15790#p3)

Measuring the impact of a specific trade deal on a country's labor market is not a straightforward

exercise, and analysts disagree on how to gauge NAFTA's effects. The USTR claims a broadly positive influence, citing figures that show an increase in overall U.S. employment of 24 percent since NAFTA's inception, as well as declining unemployment rates over the same period. In addition, the USTR

cites data showing that inflation-adjusted U.S. wages rose 19.3 percent between

1993 and 2007, as compared to only 11 percent in the fourteen years prior. Many economists agree that NAFTA has had some positive impact on overall U.S. employment. But most also agree that gains have been accompanied by some painful side effects. Edward Alden, a senior fellow at the Council on Foreign Relations, notes that wages haven't kept pace with labor productivity and that income inequality has risen in recent years, in part due to pressures on the U.S. manufacturing base. To some extent, he says, trade deals have hastened the pace of these

changes in that they have "reinforced the globalization of the American economy." Opponents of NAFTA take a starker position. Thea M. Lee is policy director for the AFL-CIO, which opposes NAFTA and lobbies against other free trade agreements as unfair to U.S. workers and corporations unless they include provisions that require signatory countries to raise labor and environmental standards. Lee

argues one of the main upshots of the deal has been to "force workers into more direct competition with each other, while assuring them fewer rights and protections." The Economic Policy Institute, a left-leaning research organization, says in a policy paper on NAFTA that the deal's trade agenda has served to widen U.S. trade deficits and

has indirectly pushed some U.S. workers into lower-paying jobs. But most economists say it's a stretch to blame these shifts on NAFTA . "The problems in Youngstown,

Ohio, and other places like that go back decades before NAFTA," says Daniel T.

Griswold, the director of the Center for Trade Policy Studies at the libertarian Cato Institute.

Griswold says job losses are "part of a structural shift of the U.S. economy" away from a focus on heavy manufacturing and toward a focus on

light manufacturing and high-end services. "It's a cruel illusion to say if we just go in and

tinker with NAFTA there will be some kind of industrial renaissance," he says. Alden echoes this idea and says that broader economic trends affecting U.S. employment--the rise of China and skyrocketing energy prices, for instance--wouldn't be substantially altered by U.S. policy shifts toward NAFTA.

Empirics show job creationLustig, 12 - PhD in Economics from the University of California at Berkeley, President of the Universidad de las Américas-Puebla, Senior Advisor and Chief of the Poverty and Inequality Unit, Department of Social Programs and Sustainable Development at the Inter-American Development Bank Director of the 2000/2001 World Development Report (Nora C., “NAFTA: Setting the Record Straight” 2012 Updated, http://www2.econ.iastate.edu/classes/econ455/lapan/Readings/NAFTA,%20Setting%20the%20Record%20Straight.pdf)

U.S. Employment and Wages Before NAFTA's approval, all opponents claimed the agreement would lead to significant job losses in the United States. Cheap, labor-

intensive Mexican imports would outcompete with U.S. goods, and plants would be attracted to Mexico

by lower wages. Three years of evidence reveals that such fears were unfounded. One indicator of the gross disemployment effects caused by NAFTA is the Trade Adjustment Assistance (NAFTA-TAA) certifications for all industries given by the Department of Labor. The cumulative figure between January 1994 and December 1996 equals close to 90,000 certifications.

Sixty percent of these are Mexico-related (as opposed to Canada or unspecified country). Forty percent of this amount is due to plant relocation , and the rest to employment displaced by imports . However, this number is the total number of recipients of NAFTA-related assistance, which is not equivalent to the total number of people who may be unemployed as a result of NAFTA. USTR figures indicate that about 6,000 of eligible recipients actually

used the benefits, suggesting that the rest have probably been reemployed. Also, an accurate assessment of the net employment effect of NAFTA would need to look at job

creation as well. A recent study that attempts to do this analytically found that the overall impact of NAFTA tariff liberalization on U.S. employment has been slightly positive. Job displacement may be causing real hardship for some individuals and

families, but it is important to put these figures in context. Since NAFTA, the United States has created about 2.25 million jobs a year. Furthermore, according to the Bureau of Labor Statistics, total gross job displacements (subsequently reemployed in most cases) during the first nine months of 1996 averaged 2.4 million workers per month. On a monthly basis, the NAFTA-TAA certified workers

since the agreement came into effect equal 2,569 a month (82,223 divided by 32 months). NAFTA-certified job displacements were only about one in 1,000 of the average monthly layoffs during the first nine months of 1996.

AT: NAFTA Bad - Wages

Recent studies point to wage increasesMatthews, 12 – Washington post (Dylan, “Study: NAFTA raised pay here and abroad” November 12, 2012 http://www.washingtonpost.com/blogs/wonkblog/wp/2012/11/12/study-nafta-raised-pay-here-and-abroad/)

Economists Lorenzo Caliendo of Yale and Fernando Parro of the Federal Reserve built a trade model to analyze how the agreement changed the level of trade between the three countries and their residents’ welfare levels. They find that the effects of NAFTA dwarf those of any other agreement, with greater effects than all other tariff reductions undertaken by

the three countries put together. All three countries saw real wages increase as a result of NAFTA. The effects in the United States and Canada, however, are fairly mild. Wages in Canada grew 0.96 percent, while U.S. wages grew 0.17 percent. That’s something, and given that U.S. wages have been stagnant or falling in recent decades, any gains are good news. But the real success

story is Mexico, where wages grew 1.3 percent due to NAFTA. That’s to be

expected, since trade with Canada and the U.S. is a more important part of its economy than, say, trade with Canada and Mexico is to the U.S. It also saw the biggest tariff reductions of the three, further amplifying the effects. 1.3 percent isn’t a ton, and the productivity gains the country has seen since have disappointed some former advocates. But it’s not

nothing. This is the pattern generally with trade liberalization. All else being

equal, all parties tend to benefit, but developing countries benefit most. That’s why global development advocates at institutions like the Center for Global Development have been pushing hard for the Obama administration to eliminate barriers that harm export industries in poor countries.

AT: NAFTA Bad - Environment

Standards checkLustig, 12 - PhD in Economics from the University of California at Berkeley, President of the Universidad de las Américas-Puebla, Senior Advisor and Chief of the Poverty and Inequality Unit, Department of Social Programs and Sustainable Development at the Inter-American Development Bank Director of the 2000/2001 World Development Report (Nora C., “NAFTA: Setting the Record Straight” 2012 Updated, http://www2.econ.iastate.edu/classes/econ455/lapan/Readings/NAFTA,%20Setting%20the%20Record%20Straight.pdf)

Labor and Environment To respond to U.S. congressional interest in incorporating labor and environmental issues into the negotiations, the Clinton administration negotiated the North American Agreement on Labor

Cooperation and the North American Agreement on Environmental Cooperation, known as NAFTA side agreements. Mexico and the United States alone established the

Border Environment Cooperation Commission (BECC) and the North American Development Bank

(NADBANK). The BECC "is expected to assist border states in both countries to design and finance environmental infrastructure projects in the border region. NADBANK is expected to provide financing for environmental projects certified by BECC and also to provide support for

community adjustment and investment projects." As part of the so-called labor side agreement, a federal government level office in each country called the National Administrative

Office (NAO) was created. One of its functions is to receive public complaints about nonenforcement of the own-country labor law. The labor and environment NAFTA side agreements were introduced to gain votes in the U.S. Congress at the time of NAFTA's approval. However, organized labor, many Democrats in Congress and some environmentalists were not satisfied with the agreements because, in their words, they lack teeth. That is, no real provisions were made to use trade sanctions

against violators of the side accords. The lack of provisions to use trade sanctions within the agreements is a blessing. Otherwise, environmental and labor issues could have been frequently used as excuses to introduce protectionist barriers and thereby obstruct NAFTA's implementation. Not even the European Union, so keen in harmonizing social standards, uses trade sanctions in the face of labor or environmental law violations. In the European Union, complaints are brought before the judicial system by the interested parties in the country where the violation took place. The rulings must be consistent with European Union norms, but all the remedial action is undertaken within the country so

that the party that has been damaged receives appropriate compensation. Still more could and should be done, both on the labor and environmental fronts, by the governments and NAFTA-created institutions. One repeated concern expressed by U.S. labor leaders is that, given the characteristics of Mexico's political system and the corporatist role played by the official unions, Mexican workers still find it hard to form and belong to independent unions. This concern is well founded even in today's more democratic Mexico, where independent unions may face serious obstacles to be recognized. This appears to have been the case in several of the complaints brought before the U.S. National Administrative Office. But the recommendations of NAO indicate an overcautious approach in dealing with this kind of labor rights violation. Even if NAO's formal recommendations on these matters are not the equivalent of rulings and do not lead to sanctions under the current terms of the side agreement (such as fines imposed on the country where the violations

occurred), greater exposure of such violations could eventually lead to a reduction in them. This would require a stronger stance on the part of the national NAO whenever such complaints are brought to its attention, even if they pertain to another of the NAFTA members. On the environmental front, the North American Development Bank (NADBANK) could be made an effective tool to foster environmental protection and cleanup, especially along the U.S.-Mexican border. The Bank's capital will soon increase from $1.5 billion to $2.25 billion. However, since its establishment, the Bank has approved only three loans totaling a mere $2.98 million and issuing guarantees for $1 million. One factor behind this low level of activity is that the established procedure, in which projects are certified by the BECC before they are analyzed for their financial viability by NADBANK, may be flawed. Switching the order in which projects are analyzed and approved may expedite loans. Another fundamental reason for this low level of lending is that the Bank's charter constrains it to operate on strictly commercial terms. Many of the potential borrowers (local

governments, nongovernmental organizations [NGOs], etc.), particularly in Mexico, lack the administrative experience and the ability to borrow funds or are simply ineligible because they would

never be able to repay the loans required to finance a specific project. Environmental projects will need some form of subsidization. If NADBANK cannot lend at below-market rates, other sources, such as governmental nonrefundable grants or private donations, will be needed to cofinance the projects with high social returns. Although this is already happening, the scale has been too small. As every other development bank, NADBANK may eventually need a window of credit on concessional terms for the poorest and most vulnerable communities.

Furthermore, the bank should probably expand its portfolio of eligible projects to include housing, education, and poverty reduction projects more generally. This would not be in violation of its charter, and such projects could have important environmental effects.

Specificially other mechanisms have been funded NN, 12 (NaftaNow, Myths vs. Reality, 05-02-2012, http://www.naftanow.org/myths/default_en.asp)

Reality: The NAFTA partners negotiated a parallel agreement on environmental cooperation, the North American Agreement on Environmental

Cooperation (NAAEC). The NAAEC commits the NAFTA partners to work cooperatively to better understand and improve the protection of their environment. The agreement also requires that each NAFTA partner effectively enforce its

environmental laws.¶ The Commission for Environmental Cooperation, established under the

NAAEC, has produced concrete improvements in the management of North American environmental issues. With a budget of US$9 million annually, some initiatives of the Commission include the:¶ development of North American management practices for toxic chemicals;¶ establishment of the first Mexican national air emissions inventory;¶ launch of the North American Bird Conservation Initiative, which provides a resource for bird conservation programs in the three countries;¶ promotion of best practices to address the linkages

between the environment, the economy, and trade.¶ Additionally, the United States and Mexico created two binational institutions. The Border Environment Cooperation Commission provides technical support for the development of environmental infrastructure projects in the U.S.-Mexico border region (www.cocef.org). The North American Development Bank finances these projects (www.nadbank.org). To date, they have provided nearly US$1 billion for 135 environmental infrastructure projects with a total estimated cost of US$2.89 billion and allocated US$33.5 million in

assistance and US$21.6 million in grants for over 450 other border environmental projects. The Mexican government has also made substantial new investments in environmental protection, increasing the federal budget for the environmental sector by 81% between 2003 and 2008.

***Competitiveness***

1acNorth America is situated for strong economic growth – the plan is key lock it in and ensure competitivenessWilson, 13 – Christopher, associate with the Mexico Institute (“New Ideas for a New Era: Policy Options for the Next Stage in U.S.-Mexico Relations,” Wilson Center, January 2013, http://www.wilsoncenter.org/sites/default/files/new_ideas_us_mexico_relations.pdf)

At a time when Mexico is poised to experience robust economic growth, a manufacturing

renaissance is underway in North America and bilateral trade is booming, the United States and Mexico have an important choice to make: sit back and reap the moderate and perhaps temporal benefits coming naturally from the evolving global context, or implement a robust agenda to improve the competitiveness of North America for the long term. Given that job creation and economic growth in both the United States and Mexico are at stake, the choice should be simple, but a limited understanding about the magnitude, nature and depth of the U.S.-Mexico economic relationship among the public and many policymakers has made serious action to support regional exporters more politically divisive

than it ought to be. The United States and Mexico have become profoundly integrated,

and the two countries are now partners, rather than competitors, in the global economy. The North American Free Trade Agreement, geographic proximity, and the

complementary nature of the two economies have fostered an integrated manufacturing platform. The United States and Mexico do not only trade finished products;

they build them together. Indeed, roughly 40 percent of all content in Mexican exports to the United States originates in the United States, much more than the comparable figures with China, Brazil, and India, at four, three, and two percent respectively. Only Canada, at 25 percent, is similar.

As a result, improvements in productivity in either country, as well as advances that lower the costs of moving goods across the border (i.e.: long wait

times, inefficient customs procedures), strengthen the competitiveness of manufacturers

throughout the whole region. An Evolving Context The Advent of Advanced Manufacturing and the Return of North American Competitiveness Driven by a series of global developments and technological advances, a manufacturing renaissance is taking hold in the United States and Mexico that is increasing the competitiveness of regional industry and the volume of U.S.-Mexico trade. After many companies moved their factories to Asia in search of cheap wages over the past two decades, new trends are pulling production facilities back to North America. While manufacturing wages in China were four times less than Mexico in 2000, they are now nearly equal and are expected to be 25 percent higher than Mexican labor costs by 2015.1 The simple math of wage differentials drove the past decade’s movement of factories from the U.S. and Mexico to China, but companies are taking an increasingly holistic approach in deciding where to locate factories, considering transportation costs and shipping times; exchange rate and political risks; language, culture, and time zone differences; contract and intellectual property law enforcement; security; production flexibility; the supply and cost of materials and energy; and the availability of skilled and educated workers. In most of these categories, Mexico is gaining ground or maintains a distinct advantage over other regions of the world, particularly in terms of serving markets throughout the Americas. For example, between 2007 and December 2012, the value of the Mexican Peso fell by 17 percent compared to the U.S. Dollar and by a full 33 percent compared to the Chinese Yuan, improving the competitiveness of regional exports vis-à-vis Chinese goods.2 Crude oil prices rose 231 percent between 2002 and 2012, thus raising shipping costs and incentivizing the use of shorter, regional rather than longer, transcontinental supply chains.3 New drilling techniques, however, are changing the outlook for oil and especially natural gas, opening access to new reserves, increasing production, and therefore lowering some energy costs. While this may eventually lower long-range shipping costs, the more immediate effect is proving to be a major decline in natural gas prices, which has already lowered electricity costs in some parts of the United States and has the potential to do so throughout both the region. Such a decline in prices provides a major boost to energy intensive industries, such as steel, and petrochemical producers. The United States is on the forefront of the technological advances in the energy industry and stands to gain the most from them, but Mexico could reap the benefits as well should it either reform its energy industry to take advantage of its significant shale gas reserves or develop the pipeline infrastructure to support increased gas imports from the United States. Technological advances and improvements in the manufacturing process and logistics are revolutionizing industrial production in ways that significantly change cost structures, further incentivizing those that had offshored to China to consider nearshoring in Mexico or reshoring their production back to the United Sates. Robots and the high-tech sensors that allow them to function with precision are allowing many of the simple, repetitive jobs that traditionally made up factory work obsolete. The need for large numbers of relatively unskilled laborers is on the decline, and the need for high skilled technicians who can program and maintain the complex machines and robots of today’s factories is on the rise. As a result, labor costs are a shrinking portion of total production costs, as evidenced by a recent study that found only 5.3% of the price of an iPhone goes to offshore manufacturing wages.4 This shift opens an opportunity for advanced economies like the U.S. to recoup some of their share of global manufacturing, especially if the complementary nature of high-tech design and production in the U.S. is complemented with lower cost manufacturing in Mexico for the portions of production that still require a higher

degree of manual labor. The widespread implementation of lean manufacturing

principles has improved the efficiency and agility of factories around the world. One important area in which fat has been cut from the manufacturing process is in warehousing. Just-in-time supply chain management has minimized the costly storage of parts and products, thus fueling the trend of regionalization in manufacturing by increasing the importance of a robust network of nearby suppliers. It is also

greatly increasing the need for short and predictable wait times at the U.S. land borders since an unexpected delay has the potential to shut down production until the needed parts arrive at their destination. Mexico on the Move For years, Mexico oriented its economy toward the U.S. in hopes of harnessing the growth of the world’s largest market. Now, at a time when Mexico is growing around four percent a year – faster than the United States – Mexico can return the favor and provide a boost to the U.S. economy. Measures of the country’s manufacturing sector are showing record-high growth, a clear sign of strengthening competitiveness, and the country is building ever more complex products like cars while leaving behind simpler industries like textiles and shoemaking. Mexico’s large and growing middle class has become an increasingly important market for U.S. products and a force for many of the economic and political reforms needed to unleash Mexico’s full economic potential.5 Altogether, Mexico’s new government inherited a very solid economic outlook despite the complex global environment, and the recent passage of important labor and education reforms suggest that the political gridlock that blocked the passage of several key economic reforms in congress for years may have finally, if perhaps only temporarily, become unstuck. Recent optimism regarding the Mexican economy has attracted significant foreign investments, and the United Nations expects FDI in Mexico in 2013 to reach a record $38 billion dollars.6 The Peña Nieto administration currently looks poised to manage a period of robust growth, and while global developments or a failure to measure up to high expectations could create downward pressures on Mexico’s growth, if Congress passes key energy, fiscal and accountability reforms, the outlook could become even brighter. A Boom in Bilateral Trade After years of slow growth (4.5 percent average annual growth from 2000-2008) and then a 17

percent drop between 2008 and 2009 during the Great Recession, U.S.-Mexico trade is now booming as never before. It is growing faster than U.S. trade with China and faster than during any period during the post NAFTA spurt in the 1990s.7 In the uncertain context of a global economy in search of a new equilibrium—Europe struggling, China’s decelerating, a fiscal reckoning in the United States—the bilateral economic relationship stands out as a pillar of strength and perhaps a signpost on the path to a stronger economic region. U.S.-Mexico trade already supports more than six million U.S. jobs, and the return of manufacturing competitiveness to the region, as well as the robust growth of the Mexican economy, presents an opportunity to significantly increase export supported employment should steps be taken to support further advances in North American competitiveness.8 The amazing thing is that this recent boom in bilateral trade has occurred without a strategy. Imagine what could be achieved if the governments of the United States and Mexico—ideally in conjunction with Canada—designed and implemented a comprehensive plan to improve the competitiveness of our region in the global marketplace. A Regional Competitiveness Agenda To cash in on the trends bringing competitiveness back to North America in a way that significantly boosts economic growth and job creation, significant policy action is needed by both the United States and Mexico. At the domestic level, each country must work through its own complex political landscape to press through key reforms, including but not limited to education and fiscal reform in both nations; competition, rule of law and energy in Mexico; and a revamp of the U.S. immigration system so that it attracts and retains the world’s top talent. The opportunities for U.S.-Mexico collaboration outlined below go hand in hand with these domestic efforts, supporting regional manufacturers and service providers so they can successfully compete in domestic and international markets. Taken together, they have the potential to truly revitalize the regional economy. Strengthening Competitiveness through

Integration The first step to improving regional competitiveness is freeing up the flow of trade within the region. As the central architecture of North American economic relations, NAFTA has spurred huge growth in regional trade and investment. Unfortunately, even as bilateral trade skyrocketed, the United States and

Mexico did not make the infrastructure investments or policy advances needed to efficiently move what now amounts to more than a billion dollars’ worth of goods back and forth across the U.S. Mexico border each day. Since the U.S. and Mexico build products together, materials and parts that are used as inputs for production often zig-zag back and forth across the border several times as a product is being made. This means that the bottom line of regional manufacturers is negatively impacted in a magnified way by any inefficiency in moving goods between the two countries. The section of this report on border management describes the challenges and solutions in greater detail, but, in short, the advances in

border security made after the terrorist attacks of 9/11 came at a price. Long and unpredictable wait

times now chip away at the competitiveness of the region. Thankfully, an innovative set of border management concepts, endorsed by the presidents of the United States and Mexico in the 21st Century Border initiative in 2010, has the potential to simultaneously strengthen security and efficiency. Some important advances on the implementation of those concepts have been achieved, but the lines at the border remain long and there is much work to do.

US-Mexican Commerce is key to the American Economy– Congestion at the border creates inefficiencies that lead to collapseWilson, 12 - Associate at the Mexico Institute of the Woodrow Wilson International Center for Scholars. (Christopher E., “The State of Trade, Competitiveness and Economic Well-being in the U.S.-Mexico Border Region,” Wilson Center Mexico Institute, June 2012, http://www.wilsoncenter.org/sites/default/files/State_of_Border_Trade_Economy_0.pdf)//AR

Commerce between the United States and Mexico is one of the great—

yet underappreciated— success stories of the global economy. In fact, in 2011 U.S.-

Mexico goods and services trade probably reached the major milestone of one-half trillion dollars with virtually no recognition.1 The United States is

Mexico’s top trading partner, and Mexico—which has gained macroeconomic stability and expanded

its middle class over the last two decades—is the United States’ second largest export market and third largest trading partner. Seventy percent of bilateral commerce crosses the border via trucks, meaning the border region is literally where “the rubber hits the road” for bilateral relations. This also means that not only California and Baja California, but also Michigan and Michoacán, all have a major stake in efficient and secure border management.¶

Unfortunately, the infrastructure and capacity of the ports of entry to process goods and individuals entering the United States has not kept pace with the expansion of bilateral trade or the population growth of the border region. Instead, the need for greater border security following the terrorist attacks of 9/11 led to a thickening of the border, dividing the twin cities that characterize the region and adding costly, long and unpredictable wait times for commercial and personal crossers alike.

Congestion acts as a drag on the competitiveness of the region and of the United States and Mexico in their entirety. Solutions are needed that strengthen both border security and efficiency at the same time. The development of the 21st Century Border initiative by the Obama and Calderón administrations has yielded some advances in this direction, but the efforts need to be redoubled.

US economy key to globalPerry, 12 – Mark, professor of economics and finance in the School of Management at the University of Michigan (“U.S. Emerges As A Main Engine of Global Growth,” 4/3/12, http://mjperry.blogspot.com/2012/04/us-emerging-as-main-engine-of-global.html)

BLOOMBERG -- "The U.S. once again may be emerging as a main engine for global growth -- and at an opportune time, as Europe slides into recession and China’s economy decelerates. An improving job market, rising stock prices and easier credit are combining to lift U.S. consumer confidence and spending, with optimism measured by the Bloomberg Comfort Index near a four-year high. Personal-consumption expenditures increased by the most in seven months in February, rising 0.8

percent, the Commerce Department said last week. “We’re entering a sweet spot for the economy,” said Allen Sinai, president of Decision Economics Inc. in New York.

“We’re in a self-reinforcing cycle,” where faster employment growth leads to higher household income and increased consumer spending. The U.S. is taking the lead in global growth, thanks in part to a domestic glut of natural gas, Larry Kantor, head of research at Barclays in New York, wrote in a March 22 report. Natural-gas futures on the New York Mercantile Exchange fell to 10-year lows last week, helping to blunt the impact of higher oil prices on the economy. U.S. manufacturers are benefiting, with the Institute for Supply Management’s factory index climbing to 53.4 (NAPMPMI) last month, beating the median estimate in a Bloomberg News survey, from 52.4 in February, the Tempe, Arizona-based

group said yesterday. Readings greater than 50 signal growth. The recovery “has been an emerging-market -- really a Chinese-led -- story, with the U.S. having lagged the

cycle,” Kantor said. “Now, however, the U.S. has reasserted its traditional role, and the current pickup in growth is clearly being led by the U.S.”

Causes global escalatory conflictsMathew J. Burrows (counselor in the National Intelligence Council

(NIC), PhD in European History from Cambridge University) and Jennifer

Harris (a member of the NIC’s Long Range Analysis Unit) April 2009 “Revisiting the Future: Geopolitical Effects of the Financial Crisis” http://www.twq.com/09april/docs/09apr_Burrows.pdf

Of course, the report encompasses more than economics and indeed believes the future is likely to be the result of a number of intersecting and interlocking forces. With so many possible permutations of outcomes, each with ample opportunity for unintended consequences, there is a growing sense of insecurity. Even so, history may be more instructive than ever. While we continue to believe that the Great Depression is not likely to be repeated, the lessons to be drawn from that period include the harmful effects on fledgling democracies and multiethnic societies (think Central Europe in 1920s and 1930s) and on the sustainability of multilateral institutions (think League of Nations in the same period). There is no reason to think that this would not be true in the twenty-first as much as in the twentieth century. For that reason, the ways in which the potential for greater conflict could grow would seem to be even more apt in a constantly volatile economic environment as they would be if change would be steadier. In surveying those risks, the report stressed the likelihood that terrorism and nonproliferation will remain priorities even as resource issues move up on the international agenda. Terrorism’s appeal will decline if economic growth continues in the Middle East and youth unemployment is reduced. For those terrorist groups that remain active in 2025, however, the diffusion of technologies and scientific knowledge will place some of the world’s most dangerous capabilities within their reach. Terrorist groups in 2025 will likely be a combination of descendants of long established groupsinheriting organizational structures, command and control processes, and training procedures necessary to conduct sophisticated attacksand newly emergent collections of the angry and disenfranchised that become self-radicalized, particularly in the absence of economic outlets that would become narrower in an economic downturn. The most dangerous casualty of any economically-induced drawdown of U.S. military presence would almost certainly be the Middle East. Although Iran’s acquisition of nuclear weapons is not inevitable, worries about a nuclear-armed Iran could lead states in the region to develop new security arrangements with external powers, acquire additional weapons, and consider pursuing their own nuclear ambitions. It is not clear that the type of stable deterrent relationship that existed between the great powers for most of the Cold War would emerge naturally in the Middle East with a nuclear Iran. Episodes of low intensity conflict and

terrorism taking place under a nuclear umbrella could lead to an unintended escalation and broader conflict if clear red lines between those states involved are not well established. The close proximity of potential nuclear rivals combined with underdeveloped surveillance capabilities and mobile dual-capable Iranian missile systems also will produce inherent difficulties in achieving reliable indications and warning of an impending nuclear attack. The lack of strategic depth in neighboring states like Israel, short warning and missile flight times, and uncertainty of Iranian intentions may place more focus on preemption rather than defense, potentially leading to escalating crises Types of conflict that the world continues to experience, such as over resources, could reemerge, particularly if protectionism grows and there is a resort to neo-mercantilist practices. Perceptions of renewed energy scarcity will drive countries to take actions to assure their future access to energy supplies. In the worst case, this could result in interstate conflicts if government leaders deem assured access to energy resources, for example, to be essential for maintaining domestic stability and the survival of their regime. Even actions short of war, however, will have important geopolitical implications. Maritime security concerns are providing a rationale for naval buildups and modernization efforts, such as China’s and India’s development of blue water naval capabilities. If the fiscal stimulus focus for these countries indeed turns inward, one of the most obvious funding targets may be military. Buildup of regional naval capabilities could lead to increased tensions, rivalries, and counterbalancing moves, but it also will create opportunities for multinational cooperation in protecting critical sea lanes. With water also becoming scarcer in Asia and the Middle East, cooperation to manage changing water resources is likely to be increasingly difficult both within and between states in a more dog-eat-dog world.

Ext – Growth Possible Now

Mexico and the US are set to experience growth – the plan is key to ensure competitivenessWilson 13 (Christopher Wilson, associate at the Mexico Institute, “A U.S.-Mexico Economic Alliance: Policy Options for a Competitive Region,” Wilson Center, May 2013, http://www.wilsoncenter.org/sites/default/files/new_ideas_new_era.pdf, AC)

At a time when Mexico is poised to experience robust economic growth, a

manufacturing renaissance is underway in North America and bilateral trade is booming,

the United ¶ States and Mexico have an important choice to make: sit back and reap the moderate ¶ and perhaps temporal benefits coming naturally from the evolving global context, or ¶ implement a robust agenda to improve the competitiveness of North America for the ¶ long term. Given that job creation and economic growth in both the United

States and ¶ Mexico are at stake, the choice should be simple, but a limited understanding about

the ¶ magnitude, nature and depth of the U.S.-Mexico economic relationship among the public and many policymakers has made serious action to support regional exporters more ¶ politically divisive than it ought to be. ¶ The United States and Mexico have become profoundly integrated, and the two ¶ countries are

now partners, rather than competitors, in the global economy. The North ¶ American Free Trade Agreement, geographic proximity, and the complementary nature ¶ of the two economies have fostered an integrated manufacturing platform. The United ¶ States and Mexico do not only trade finished products;

they build them together. Indeed, ¶ roughly 40 percent of all content in Mexican exports to the United States originates in ¶ the United States, much more than the comparable figures with China, Brazil, and India, ¶ at four, three, and

two percent respectively. Only Canada, at 25 percent, is similar. As a ¶ result, improvements in productivity in either country, as well as advances that lower the ¶ costs of moving goods

across the border (i.e.: long wait times, inefficient customs procedures), strengthen the competitiveness of manufacturers throughout the whole region.

Mexico is at a crucial crossroads – initial infrastructure developments are failing – investment now is critical O'Neil, 11 – Senior Fellow for Latin America Studies for the CFR (Shannon, “Mexico: Development and Democracy at a Crossroads” CFR Expert Briefs, February 2011, http://www.cfr.org/mexico/mexico-development-democracy-crossroads/p24089)//AR

http://www.cfr.org/mexico/mexico-development-democracy-crossroads/p24089¶ Yet despite its free trade and pro-business credentials, from other vantage points Mexico's markets are much less free. Oligopolies and state monopolies continue to exert considerable influence over crucial sectors of the Mexican economy. In telecommunications, the media, cement, soft drinks, bread and tortillas, and electricity and energy, one

or a few companies dominate. Mexico's billionaires, unlike American heavyweights such as Bill

Gates or Warren Buffett, generally made their money from these uneven

playing fields. Special interest groups, in business as well as labor, have managed to block changes. Perpetuating these economic fiefdoms increases inequality and limits competitiveness, innovation, and ultimately growth.¶ Physical infrastructure holds Mexico back as well. By the early 2000s, Mexico was last among Latin American economies—and far behind their OECD counterparts—in terms of infrastructure investment as a portion of

GDP. The limits on roads, railroads, ports, water and electricity systems, telecommunications, and the like hamper efficiency and productivity throughout the economy—shaving valuable cents off Mexico's industrial competitiveness. To fund an infrastructure transformation, Mexico will have to reform its tax system—currently one of the lowest in the world, besting only Guatemala in the hemisphere by collecting some 11 percent of GDP.¶ Last year, Mexico celebrated as it claimed the top spot in Latin America in the World Bank's Doing Business survey, overtaking Colombia. By revamping its bankruptcy laws and cutting the burdens on doing business, at a global ranking of 35 (up from 41 in 2010) Mexico today is far ahead of Brazil, its much-hyped rival, at 127. Nevertheless, as its peers and neighbors reform their institutions and labor markets and invest in education, infrastructure, and

innovation, Mexico is falling behind on broader measures of competitiveness. In the World Economic Forum's 2010 Global Competitiveness Index, Mexico's ranking fell six notches to sixty-sixth among 139 countries. The country's large, unwieldy bureaucracy; unreformed labor laws; weak regulatory framework; and low investment in human and physical capital will continue to hinder competitiveness,3 while its customs regulations and product standards introduce further pitfalls for foreign investors.

US-Mexican Commerce is key to the American Economy– Congestion at the border creates inefficiencies that lead to collapseWilson, 12 - Associate at the Mexico Institute of the Woodrow Wilson International Center for Scholars. (Christopher E., “The State of Trade, Competitiveness and Economic Well-being in the U.S.-Mexico Border Region,” Wilson Center Mexico Institute, June 2012, http://www.wilsoncenter.org/sites/default/files/State_of_Border_Trade_Economy_0.pdf)//AR

Commerce between the United States and Mexico is one of the great—

yet underappreciated— success stories of the global economy. In fact, in 2011 U.S.-

Mexico goods and services trade probably reached the major milestone of one-half trillion dollars with virtually no recognition.1 The United States is

Mexico’s top trading partner, and Mexico—which has gained macroeconomic stability and expanded

its middle class over the last two decades—is the United States’ second largest export market and third largest trading partner. Seventy percent of bilateral commerce crosses the border via trucks, meaning the border region is literally where “the rubber hits the road” for bilateral relations. This also means that not only California and Baja California, but also Michigan and Michoacán, all have a major stake in efficient and secure border management.¶

Unfortunately, the infrastructure and capacity of the ports of entry to process goods and individuals entering the United States has not kept pace with the expansion of bilateral trade or the population growth of the border region. Instead, the need for greater border security following the terrorist attacks of 9/11 led to a thickening of the border, dividing the twin cities that characterize the

region and adding costly, long and unpredictable wait times for commercial and personal crossers alike.

Congestion acts as a drag on the competitiveness of the region and of the United States and Mexico in their entirety. Solutions are needed that strengthen both border security and efficiency at the same time. The development of the 21st Century Border initiative by the Obama and Calderón administrations has yielded some advances in this direction, but the efforts need to be redoubled.

EXT – Plan key to competitiveness

Border efficiency is key to the competitiveness of the region – investment results in a positive returnWilson, 12 - Associate at the Mexico Institute of the Woodrow Wilson International Center for Scholars. (Christopher E., “The State of Trade, Competitiveness and Economic Well-being in the U.S.-Mexico Border Region,” Wilson Center Mexico Institute, June 2012, http://www.wilsoncenter.org/sites/default/files/State_of_Border_Trade_Economy_0.pdf)//AR

The intense U.S.-Mexico trade flows pass through the U.S.-Mexico border region, a region with a complex economy that can be seen as both wealthy and poor. A number of organizations--the Border Governors Conference included among them—have often noted that the ten states together as a single economic entity would

comprise the fourth largest economy in the world. Other organizations have noted that the region possesses a highly varied economic makeup, with San Diego/Tijuana and El Paso/Ciudad Juarez serving as the principal poles of wealth and other cities and particularly rural regions enjoying a much less prosperity. The Tijuana-based Colegio de la Frontera Norte and Francisco Lara of Arizona State University have developed an index that weighs many of the key variables that measure competitiveness. The map below largely confirms previous findings, and the research sets an important baseline to measure efforts underway to strengthen regional competitiveness. The research suggests the U.S. side of the border generally has more tools for high productivity, but the main population centers on the Mexican side tend

to also have strong competitiveness. Efforts to further foment the development of infrastructure, human capital, innovation and cluster economies in the key twin-cities of the border region would strengthen not only the competitiveness of the border region but also the areas served by the trade corridors running through them (virtually all of the U.S. and Mexico). While much of this chapter focuses on binational and national policy responses to border challenges, governors, state legislators and mayors (among others) are key local players in economic decision-making. Much of the border region is rural or made up of smaller urban areas, and economic development in these areas faces challenges that are often more domestic than binational in nature (primary and secondary education, for example). ¶ While a number of studies commissioned by local entities (see Table 2 on the various cross border economic studies conducted by local entities) point out the impressive economic significance of the ports of entry, studies outlining the best practices for local border region decision makers in terms of taking advantage of cross border trade for local development are few and far between. This may be because the cities along the U.S.-Mexico border have historically seen themselves to be in competition with each other in terms of attracting business. Often, economic development in the border region is discussed in stark zero-sum terms (City A wanting to take some cross border business away from City B, for example).¶ Despite the incredible diversity present throughout the U.S.-Mexico border region, many border communities face similar challenges. Communities throughout the region are seeking to strengthen their bases of local suppliers so that an ever-greater portion of the

value-added processes can take place (and therefore support jobs) locally. The development of human capital—including education, workforce training, and strategies to attract and retain high skilled workers—is another shared challenge. Attracting talent, companies, and tourists are all made more difficult by the perceptions (and sometimes realities) of violence in the region, and of course, communities all along the border stand to benefit from better infrastructure and more efficient ports of entry. All of this is to say that the incentives are in place for greater collaboration for economic development not only across the border, but also from one end to the other. The relatively newly created U.S.-Mexico Border Mayors Association is an entity which will hopefully take up this unique and daunting

challenge of articulating a border-wide vision of economic development that is rooted in the need for local communities to share best economic development practices.

The plan ensures competitiveness and stimulates growthLee and Wilson, 12(Erik, Associate Director at the North American Center for Trans-border Studies at ASU, and Christopher E., Associate at the Mexico Institute of the Woodrow Wilson International Center for Scholars, “The State of Trade, Competitiveness, and Economic Well-being in the U.S.-Mexico Border Region,” June 2012, http://www.wilsoncenter.org/sites/default/files/State_of_Border_Trade_Economy_0.pdf, AC)

Commerce between the United States and Mexico is one of the great yet highly ¶ underappreciated success stories of the global economy.

The United States is Mexico’s top ¶ trading partner, and Mexico—which has made enormous strides in

its macroeconomic picture ¶ in the last two decades—is the U.S.’ third-ranked partner in terms of total trade. ¶ The economic vitality of the U.S.-Mexico border region—which includes manufacturing, ¶ infrastructure, human capital and tourism, among other elements—is a key part of this overall ¶ economic success. With more than a billion dollars of commercial traffic crossing the border ¶ each day, it is literally at the U.S.-Mexico border region where “the rubber hits the road” in ¶ terms of this expanded regional trade. This is because more than 70% of total binational ¶ commerce passes through the border region via trucks. This already massive truck traffic is ¶ expected to increase significantly in the coming decades (see Figure 1 below). Since the implementation of the North American Free Trade Agreement in 1994, total trade ¶ between the two countries has more than quintupled, and goods and services trade is now at a ¶ Billions of U.S. Dollars¶ Merchandise Trade Services Trade5¶ half trillion dollars per year. An estimated six million U.S. jobs and probably even more Mexican ¶ jobs depend on bilateral trade.2¶ The six Mexican and four U.S. border states have especially close bilateral economic ties, but ¶ what is often unappreciated is that this economic value extends far beyond the border region. ¶ Mexico, for example, is the top buyer of exports from states as far away as New Hampshire ¶ (mostly computers and electronics). In fact, Mexico is the first or second most important export ¶ market for twenty-one states from Colorado to Ohio, and twenty U.S. states sell more than a ¶ billion dollars’ worth of goods to Mexico each year. The United States in an even more ¶ important market for Mexican exports. Seventy-nine percent of Mexican exports are sold to the ¶ United

States, including products produced in the border region and throughout the country.3¶ Crude oil, for example, which is mostly produced in Mexico’s Gulf Coast states, is the top single ¶ export to the United States, but automobiles and auto-parts, which make up an even greater ¶ share of exports when taken together, are mainly made in the center and north of the country.4¶ The quantity of U.S.-Mexico trade is impressive, but its quality makes it unique. The United ¶ States and Mexico do not just sell goods to one another, they actually work together to ¶

manufacture them. Through a process known as production sharing, materials and parts often ¶ cross back and forth between factories on each side of the border as a final product is made ¶ and assembled. As a result, U.S. imports from Mexico contain, on average, 40 percent U.S. ¶ content, and Mexico’s imports from the U.S. also have a high level of Mexican content. 5¶ This system of joint production has two

important consequences. First, it means that our ¶ economies are profoundly linked. We tend to experience growth and recession together, and ¶ productivity gains or losses on one side of the border generally cause a corresponding gain or ¶ loss in competitiveness on the other side as well. In sum, we will largely succeed or fail together ¶ and must therefore join forces to increase the competitiveness of the region. Second, the fact ¶ that goods often cross the border several times as they are being produced creates a multiplier ¶ effect for gains and losses in border efficiency. Whereas goods from China only go through ¶ customs and inspection once as they enter the U.S. or Mexico, products built by regional ¶ manufacturers bear the costs of long and unpredictable border wait times and significant ¶ customs requirements each time they cross the U.S.-Mexico border. Leading industrial sectors in U.S.-Mexico trade include automobiles, aerospace, and

home ¶ appliances, and medical devices, to name but a few. We often find extremely high-skilled labor ¶ involved in complex aspects of U.S.-Mexico trade, including custom parts metal work, products ¶ requiring skilled labor. These processes often link designers, developers, raw materials ¶ producers and parts manufacturers in the United States to high skilled labor, engineers, and ¶ plant managers in Mexico. While in truth both countries participate in all parts of the supply ¶ chain depending on the product, these are some broad characteristics that often hold true for ¶ which parts of the manufacturing process each country specializes in.¶ In addition to manufactured goods, agricultural products also flow between the two countries. ¶ This includes U.S. exports of food products (grains and processed foods) from states such as¶ South Dakota, Nebraska, and Iowa, as well as Mexican fruit and vegetable exports from key ¶ states such as Sinaloa and Michoacán. ¶ As a final point to introduce this macro view of U.S.-

Mexico trade, it must be emphasized that ¶ this trade relationship requires major infrastructure to function effectively. The largest trade ¶ corridor, often referred to as the NASCO corridor, links central and eastern Mexico to Texas, the ¶ American Midwest, Northeast, and Ontario, utilizing the key Laredo-Nuevo Laredo ports of ¶ entry (POEs). Other important trade arteries include the CANAMEX Corridor, which connects ¶ western Mexico to the intermountain United States and Canadian province of Alberta, as well ¶ as the shorter but high-

volume I-5 corridor connecting California to Baja California. As the ¶ economies of both the U.S. and Mexico grow, it is likely that this network of freight ¶ transportation infrastructure—and the land ports of entry that serve as nodes in this network—¶ will experience added stress (see Figure 2 on the next page).

Infrastructure investment key to competitivenessVillarreal 2012 (M. Angeles, specialist in international trade and finance, “U.S.-Mexico Economic Relations: Trends, Issues, and Implications,” Congressional Research Service, 08/09/2012, http://www.fas.org/sgp/crs/row/RL32934.pdf, AC)¶ Most efforts to increase North American regulatory cooperation generally have followed the ¶ recommendations of special working groups created under the SPP. These recommendations have ¶

included (1) increasing the competitiveness of North American businesses and

economies through ¶ more compatible regulations; (2) making borders smarter and more secure by coordinating longterm infrastructure plans, enhancing services, and reducing bottlenecks and congestion at major ¶ border crossings; (3) strengthening energy security and protecting the environment by developing ¶ a framework for harmonization of energy efficiency standards and sharing technical information; ¶ (4) improving access to safe food and health and consumer products

by increasing cooperation ¶ and information sharing on the safety of food and products; and (5) improving the North ¶ American response to emergencies by updating bilateral agreements to enable government ¶ authorities from the three countries to help each other more quickly and efficiently during times ¶ of crisis.

Ext – Job Creation

Investment in border infrastructure creates JobsLee, 09 - Associate Director at the North American Center for Transborder Studies (NACTS) at Arizona State University (Erik, “Transportation infrastructure and competitiveness,” Wilson Center Mexico Institute, 7/1/09, http://www.wilsoncenter.org/sites/default/files/BLANK%20LEE%20INFRASTRUCTURE.pdf)//AR

We must emphasize that the large numbers above are tempered by the significant return on the

investment. Infrastructure investment creates jobs; transportation experts generally agree that approximately 35,000 jobs are created per billion dollars invested in infrastructure. As former Arizona Governor Janet Napolitano mentioned to then President-elect Obama in a December 11 letter, “...Immediately creating

quality, good-paying jobs while laying the foundation for longterm economic growth is one of the best investments the Federal government can make in this troubled economy.”9¶ President Eisenhower’s Federal Highway Aid Act of 1956, which created the highway system of the United States, provides a tangible example of the type of return on investment that can be achieved through the creation of such a highway system. Partly because of the Highway Aid Act, the U.S. economy is the most productive and envied in the world. In recent years, however,

insufficient investment in the U.S. highway system has cost the country dearly. According to the Texas Transportation Institute, “Congestion on roads costs $78 billion annually in the form of 4.2 billion lost hours and 2.9 billion gallons of wasted petrol.”10 According to the Department of State, NAFTA or North American transboundary commerce is estimated at $1.7M per minute, $2.4B per day, or $876B per year and expected to grow. Not investing the $2.6 trillion jeopardizes NAFTA trade and the jobs that depend on this trade. The return on the investment is significant—between 3:1 and 50:1, according to NACTS’ calculations — and would significantly stimulate demand and help to jump-start the U.S. and North American economies. Moreover, investment improves quality of life in the most basic way—it saves lives. According to a 2007 report by American Association of State Highway and Transportation Officials (AASHTO), “Today’s [U.S.] highway death toll of over 43,000 annually can be cut in half through a series of safety action investments.”11

Investment in border infrastructure creates JobsLee, 09 - Associate Director at the North American Center for Transborder Studies (NACTS) at Arizona State University (Erik, “Transportation infrastructure and competitiveness,” Wilson Center Mexico Institute, 7/1/09, http://www.wilsoncenter.org/sites/default/files/BLANK%20LEE%20INFRASTRUCTURE.pdf)//AR

We must emphasize that the large numbers above are tempered by the significant return on the

investment. Infrastructure investment creates jobs; transportation experts generally agree that approximately 35,000 jobs are created per billion dollars invested in infrastructure. As former Arizona Governor Janet Napolitano mentioned to then President-elect Obama in a December 11 letter, “...Immediately creating

quality, good-paying jobs while laying the foundation for longterm economic growth is one of the best investments the Federal government can make in this troubled economy.”9¶ President Eisenhower’s Federal Highway Aid Act of 1956, which created

the highway system of the United States, provides a tangible example of the type of return on investment that can be achieved through the creation of such a highway system. Partly because of the Highway Aid Act, the U.S. economy is the most productive and envied in the world. In recent years, however,

insufficient investment in the U.S. highway system has cost the country dearly. According to the Texas Transportation Institute, “Congestion on roads costs $78 billion annually in the form of 4.2 billion lost hours and 2.9 billion gallons of wasted petrol.”10 According to the Department of State, NAFTA or North American transboundary commerce is estimated at $1.7M per minute, $2.4B per day, or $876B per year and expected to grow. Not investing the $2.6 trillion jeopardizes NAFTA trade and the jobs that depend on this trade. The return on the investment is significant—between 3:1 and 50:1, according to NACTS’ calculations — and would significantly stimulate demand and help to jump-start the U.S. and North American economies. Moreover, investment improves quality of life in the most basic way—it saves lives. According to a 2007 report by American Association of State Highway and Transportation Officials (AASHTO), “Today’s [U.S.] highway death toll of over 43,000 annually can be cut in half through a series of safety action investments.”11

Border Infrastructure investment prevents bottlenecks from exasperating border entries – Key to competitiveness and growthUS Chamber of Commerce, 10 – American lobbying group representing the interests of many businesses and trade associations (CoC, “Steps to a 21st Century U.S.-Mexico Border,” A U.S. Chamber of Commerce Border Report, 5/19/10, http://www.uschamber.com/sites/default/files/reports/2011_us_mexico_report.pdf)//AR

Assessment of Current Infrastructure and a Look Ahead¶ According to the U.S. Department of

Transportation, each $1 billion in federal highway investment accompanied by a state match supports 34,779 jobs. Conversely, a decaying surface transportation system costs the U.S. economy $78 billion annually in lost time and fuel; and crashes—approximately one-third of which are attributable to road conditions—drain an additional $220 billion.¶ Vision for the Future We believe in the need to modernize, maintain, and expand America’s transportation infrastructure in order to meet national needs, move people and goods more safely and effi ciently, and

strengthen U.S. economic competitiveness. According to San Diego’s Regional Planning Agency (SANDAG), the demand at existing ports of entry necessitates the improvement of current infrastructure

in order to ensure the “economic and social stability of the border region.”¶ ii Improving infrastructure along the U.S.-Mexico border will notnly spur real economic benefits and job growth in border communities, but it will also create economic returns for the entire U.S. economy. Along with upgrading existing infrastructure, investment in new capacity is also needed. Without adequate transportation infrastructure capacity and reliable cost-effective transportation services, the economic growth, productivity, and competitiveness of metropolitan areas, mega regions, and key industries are at risk. For example, the United States must prepare for the expected doubling of domestic freight volume and quadrupling of international freight volume entering U.S. ports over the next 30 years. Transportation bottlenecks at major U.S. ports, gateways, and trade corridors have significant economic, environmental, and energy implications.¶ Clearly, the utilization of existing assets can be improved, but capacity investments are also necessary, particularly at the U.S.-Mexico border. In

2005, Congress passed a five-year authorization of the nation’s highway and transit program, the Safe,

Accountable, Flexible, Efficient, Transportation Equity Act: A Legacy for Users (SAFETEA-LU), which provided more than $2.8 billion to fund transportation projects of national interest to improve

transportation at international borders, ports of entry, and in trade corridors. A Coordinated Border Infrastructure Program provided $833 million in funding, to be distributed by formula, to expedite safe and efficient vehicle and cargo movement at or across the land border between the United States and Canada and the land border between the United States and Mexico. In the next Reauthorization, Congress and the administration

must build on the successes of these programs in order to continue improving freight movement through our borders. The United States must also engage the private sector, which is ready and willing to engage as partners in financing, building, and maintaining infrastructure upgrades and expansion along the border

Investment spurs increased relationship via economic innovation Leycegui, 12 - Senior Fellow, International Centre for Trade and Sustainable Development (Beatriz, “What Should the Top Priority Be for U.S.-Mexican Relations?”, Americas Society; Council of the Americas, 12/3/12, http://www.as-coa.org/articles/viewpoints-what-should-top-priority-be-us-mexican-relations)//AR

One of their top priorities should be to address with a greater sense of urgency the bilateral and North American competitiveness agenda. The Mexican and U.S. economies are highly integrated and interdependent. If their economies do well, the impact on job creation is immediate. The U.S. is Mexico’s most important export market; Mexico is the U.S.’s second most important export market. Of every dollar the U.S. imports of Mexican goods, 40 percent have American content, in comparison to China’s (4 percent), Brazil’s (3 percent), or India’s (2 percent). Due to the reduction in the differential in labor costs between Mexico and China (in 2003, it stood at 237 percent; in 2010, at 13.8 percent) and increases in energy and transport costs, investment and production are returning to North America. The most important elements of the North American competitiveness agenda should include: expediting the work to create a twenty-first-century border (infrastructure, risk management, pre-clearance, customs cooperation); strengthen regulatory cooperation (mutual recognition of regulations); liberalization of strategic services (e.g. telecommunications, air, land and sea transportation), and the improvement in the enforcement of intellectual property laws. The Trans-Pacific Partnership negotiations can be an opportunity to advance some of these issues. Mexico and the United States cannot fight geography. Why would Mexico forego the benefit of being next to the most important economy of the world? Why would the United States ignore the possibility of further integrating with a country that has proven to be a partner in production more than a competitor?

Infrastructure investment promotes Mexican innovation – key to NA competitivenessStarr, 09 - director of the U.S.-Mexico Network, a university fellow at the USC Center on Public Diplomacy, and an associate professor of teaching in the School of International Relations and in Public Diplomacy (Pamela K, “Mexico and the United States: A Window of Opportunity?,” Pacific Council on International Policy, April 2009, http://www.pacificcouncil.org/document.doc?id=35)//AR

North American Competitiveness and Energy Cooperation The best way for the United States to help Mexico promote recovery and enhance economic competitiveness in the near term is to put its own economic house in order without succumbing to the evident protectionist impulse in Congress. A U.S. recovery would re-establish the export market and sources of investment capital that are key to the health and innovative capacity of the Mexican economy. A successful effort to save U.S. automakers would also ensure the survival of their plants in Mexico, one of the largest and most modern and competitive segments of the Mexican manufacturing sector.And President Obama’s promised infrastructure investment program, in conjunction with a parallel program already underway in Mexico, could easily include projects to improve the aging and inadequate transportation infrastructure along the border. This bottleneck is responsible for extensive delays in cross-border trade that continue to undermine North American economic competitiveness. The United States should also consider increasing and making semi-permanent the $30 billion currency swap agreement between the country’s central banks to provide an even firmer footing for the Mexican peso during the current crisis. Most important, Mr. Obama must resist pressure to renegotiate the North American Free Trade Agreement in a manner that uses labor and environmental provisions as cover for protectionist trade policies. As a clear sign of his willingness to do so, he should press Congress to finally honor the U.S. commitment under NAFTA to allow Mexican trucks to deliver their cargo beyond the border.

***Relations***

1ac

The plan revitalizes US-Mexico relations - Infrastructure is keySelee and Wilson, 12 – Andrew, Vice President for Programs and Senior Advisor to the Mexico Institute at the Wilson Center, Christopher, associate with the Mexico Institute (“A New Agenda with Mexico,” Wilson Center, November 2012, http://www.wilsoncenter.org/sites/default/files/a_new_agenda_with_mexico.pdf)

Summary The depth of economic ties with Mexico, together with declines in illegal immigration and

organized crime violence in Mexico, Open up an opportunity for U.S. policymakers to deepen the economic relationship with Mexico and to engage Mexico more on major global issues. Security cooperation, especially strengthening institutions for rule of law and disrupting money laundering, will remain important to the relationship, and there are clear opportunities to reform the U.S. legal immigration system over the next few

years, which would have important implications for the relationship with Mexico. The strongest engagement, going forward, is likely to be on the economic issues that can help create jobs for people on both sides of the border, and on the shared global challenges that both countries face. Few countries will shape America’s future as much as Mexico. The two countries share a 2,000 mile border, and Mexico is the second largest destination for U.S. exports and third source of oil for the U.S. market. A quarter of all U.S. immigrants are from Mexico, and one in ten Americans are of Mexican descent. Joint security challenges, including both terrorist threats and the violent operations of drug cartels, have forced the two governments to work more closely than ever. What’s more, cooperation has now extended to a range of other global issues, from climate change to economic stability. Nonetheless,

the landscape of U.S.-Mexico relations is changing. Illegal immigration is at the lowest level in four

decades, and organized crime violence, which has driven much of the recent cooperation, is finally declining. Violence will remain a critical issue, but economic issues—bilateral and global—have risen to the fore as both countries struggle to emerge from the global slowdown. Trade has increased dramatically, connecting the manufacturing base of the two countries as never before, so that gains in one country benefit the other. To keep pace with these changes, U.S. policymakers will need to deepen the agenda with Mexico to give greater emphasis to economic issues, including ways to spur job creation, and they will have opportunities to strengthen cooperation on global issues. Security cooperation will remain critical, and determined but nuanced follow through to dismantle the operations of criminal groups on both sides of the border will be needed to continue the drop in violence. With less illegal immigration, it will be easier to

address legal migration in new ways. However, economic issues are likely to dominate the bilateral agenda for the first time in over a decade. Strengthening Economic Ties and Creating Jobs In most trading relationships, the U.S. simply buys or sells finished goods to another country. However, with its neighbors, Mexico and Canada, the U.S. actually co-manufactures products. Indeed, roughly 40 percent of all content in Mexican exports to the United States originates in the United States. The comparable figures with China, Brazil, and India are four, three, and two percent respectively. Only Canada, at 25 percent, is similar. With the economies of North America

deeply linked, growth in one country benefits the others, and lowering the transaction costs of goods crossing the common borders among these three countries helps put money in the pockets of both workers and consumers. Improving border ports of entry is critical to

achieving this and will require moderate investments in infrastructure and staffing, as well as the use of new risk management techniques and the expansion of pre-inspection and trusted shipper programs to speed up border crossing times. Transportation costs could be further lowered — and competitiveness further strengthened — by pursuing an Open Skies agreement and making permanent the cross-border trucking pilot program. While these are generally seen as border issues, the benefits accrue to all U.S. states that depend on exports and joint manufacturing with Mexico, including Michigan, Ohio, Nebraska, Iowa, South Dakota, New Hampshire, and Georgia, to name just a few.

Economic focus is key to relations – solves Central American stability and Mexican leadership (This is also a link turn to CIR politics)Wood and Wilson, 13 – Duncan, director of the Mexico Institute at the Woodrow Wilson Center for International Scholars, and Christopher, associate with the Mexico Institute (“New Ideas for a New Era: Policy Options for the Next Stage in U.S.-Mexico Relations,” Wilson Center, January 2013, http://www.wilsoncenter.org/sites/default/files/new_ideas_us_mexico_relations.pdf)

The new administrations begin working together at a time of considerable optimism in the relationship. Mexico has developed a highly competitive democratic system, and its rising middle class, solid macroeconomic footing and positive outlook for economic growth make the country a pillar of strength in a complex and volatile global environment. As the United States faces a post-Great Recession, post-9/11 world, it is increasingly aware of the transnational dimensions of U.S. economic and national security. Mexico is a key partner on each of these fronts. Whether in the form of joint efforts to protect the region from terrorist threats or to reduce the violence perpetrated by

transnational organized crime, security cooperation has dominated the bilateral agenda since 2001.

The Peña Nieto administration now seeks a rebalancing of the agenda, giving greater weight to strengthening the economic competitiveness of the region, and there is reason to believe such an

approach could achieve some success. U.S.-Mexico trade is booming, growing faster than U.S. trade with China and faster than it did after NAFTA took effect in the 1990s. In a way that cannot be said for drugs, violence, or illegal immigration, focusing on the creation of jobs and improving the competitiveness of manufacturers on both

sides of the border is a good-news story. Greater focus on this dimension of the relationship could potentially

change the tone of the relationship in a way that makes the stickier issues of security and migration a little less intractable. Progress on the economic agenda, including intraregional efforts to move goods and services across the border more efficiently as well as cooperation on global trade issues like the Trans-Pacific Partnership, could provide a significant boost to both the U.S. and Mexican economies. While economic issues are likely to see increased attention, much of the day to day work in the bilateral relationship will remain focused on security. There are signs that overall levels of organized crime- related violence in Mexico finally began to decline in 2012 after several years of growth, though much work remains to be done on issues of public security and criminal justice reform in Mexico, drug consumption in the United States, and the trafficking of weapons, drugs and illicit funds between the two countries. Fortunately, over the past six years an unprecedented level of cooperation between the U.S. and Mexican governments and their many law enforcement and national security agencies has been achieved, leaving a legacy of increased understanding and trust. Efforts must now be made by both sides to consolidate these gains in the context of the new security strategy being defined by the Mexican administration, the change in personnel in Mexico after the election, and the institutional adjustments seen with the strengthening of Mexico’s Secretariat of Internal Affairs (Gobernación) and the organization changes affecting the Secretariat of Public Security. On the question of migration, there has been a shift in internal politics in the U.S. that permits a more open debate on immigration than at any time in recent memory, with a bipartisan willingness to consider meaningful reform of immigration laws. This happens at the same time as we have seen a significant drop in migration flows from Mexico, high levels of reverse migration and a more robust economy in Mexico beginning to create more jobs south of the border. Since 2007, the number of Mexican migrants illegally entering the United States has dropped to historically low levels, with a net outflow of unauthorized immigrants from the U.S. over the past three years. The drop is partially because of the weak U.S. economy, but it also has to do with more effective U.S. border enforcement and better economic opportunities in Mexico. This shift, along with a newfound bipartisan willingness to consider reforming immigration policy after the 2012 presidential election in the United States, offers the potential for both countries to explore new approaches to migration for the first time in a decade. In the United States, policymakers have an opportunity to look especially at how to reform the legal immigration system so that the country can ensure it has the human capital needed, at all skill levels, to fuel innovation and growth. Mexican policymakers, on the other hand, have opportunities to consolidate Mexico’s burgeoning middle class in those communities where migration has been a feature of life so as to make sure that people no longer need to leave the country to get ahead. Mexico could also facilitate U.S. reform efforts by indicating how they could help cooperate with a new U.S. visa system if the U.S. Congress moves forward on a legal immigration reform. In the area of energy policy, there is a realistic chance that the Pena Nieto government will be able to secure the passing of energy reform legislation that opens up Mexico’s oil and gas industry to private and foreign participation. This development, should it come to pass, will drive forward higher levels of investment and cooperation by U.S. hydrocarbons firms in Mexico. In particular in the area of shale gas and shale oil, it is U.S. firms that possess the technology and expertise that will be required to develop Mexico’s resources. On environmental issues connected to the oil and gas sector there is a pressing need for bilateral cooperation on standards and implementation, especially in light of the Transboundary Hydrocarbons Agreement covering oil exploration in the

Gulf of Mexico. Similar to other large middle-income countries, Mexico has reason to be increasingly active in responding to regional and global issues. As Mexico’s economy grows, so will its weight on the global stage.

Since Mexico is a key partner for the United States on global issues and the two countries have many shared interests, this represents an opportunity for the United States. Mexico, too, has much to gain from working in partnership with the United States. Despite recent successes in its role in hosting the G-20 and the United Nations

Climate Change Conference, Mexico has punched below its weight on foreign policy for several years. To increase international clout, Mexico must become even more active in international institutions—perhaps UN peacekeeping

operations—and could become a regional leader in supporting Central American countries as several face public security crises caused by organized crime and gangs. The presence of so many opportunities in bilateral relations does not mean that the path ahead is obstacle-free. In fact, due to the

intense blend of domestic politics and international affairs that makes up the U.S.-Mexico relationship, without a determined effort on the part of both governments to keep the bilateral relationship positive and productive, it can easily be pulled off track by scandals and disagreements. Some policy areas are particularly sensitive. On security cooperation, for example, some joint efforts implemented with the previous Mexican administration may be considered too risky by the new team; officials will have to take care to move forward with an overall approach based on collaboration and shared responsibility even as the details of cooperation are renegotiated. On the issue of energy, any discussion of cooperation in the area of oil still requires sensitivity on the part of the United States, particularly at this time of potential change in the legislative framework in Mexico. Similarly, the ability of Mexico to push for progress on a U.S. immigration reform is limited, and Mexican officials will have to choose their strategy carefully. The purpose of this report, therefore, is to identify areas in the bilateral relationship where mutually beneficial cooperation can be pursued. In a way that has not been the case for at least a decade, the context in which the new U.S. and Mexican administrations meet is one of tremendous opportunity. Taking full advantage of this opportunity-laden moment will not be easy, but the potential in deepening the U.S.-Mexico strategic partnership justifies an investment from both sides in terms of resources, time and political will.

Perception key to access the strategic parts of the relationshipGarza, 12/3/12 – Antonio, Former U.S. Ambassador to Mexico (“A first step is to get rid of outdated perceptions—on both sides,” Americas Society/Council of the

Americas, http://www.as-coa.org/articles/viewpoints-what-should-top-priority-be-us-mexican-relations)

The United States and Mexico have enjoyed a very healthy and respectful relationship. On issues of shared

interest—primarily trade and security—we’ve cooperated, though mostly out of necessity. Yet neither country has

ever truly leveraged the bilateral relationship strategically. What will it take to bring about

this kind of fundamental shift? A first step is to get rid of outdated perceptions—on both

sides. You simply can’t expect to have a strategic relationship that functions in real time if perceptions lag present realities. There’s been new research and insightful commentary recently highlighting the gap between Americans’ perceptions of Mexico and the country’s current reality. President Enrique Peña Nieto faces the daunting task of moving Main Street U.S. perceptions of Mexico closer to where the views of economists, investors, and discerning travelers are on the country. He will help this along by conveying his administration’s absolute commitment to carrying through promised economic reforms, implementing anti-corruption

and transparency initiatives, and reinforcing cooperation on security. For President Obama, it’s important to signal that his new team is completely schooled in the reality of today’s Mexico and that they are prepared to take advantage of the moment to recast the relationship to the benefit

of both countries. Delivering on immigration reform and the Trans-Pacific Partnership trade agreement are rare opportunities for a U.S. administration to fundamentally alter Mexicans’ perceptions of their northern partner. As Mexico’s place in the world rises andthe U.S. continues to recalibrate its foreign alliances,

there’s a unique opportunity to move the bilateral relationship to a more strategic level—but it will take some work.

Relations key to Central American stabilitySelee and Wilson, 12 – Andrew, Vice President for Programs and Senior Advisor to the Mexico Institute at the Wilson Center, Christopher, associate with the Mexico Institute (“A New Agenda with Mexico,” Wilson Center, November 2012, http://www.wilsoncenter.org/sites/default/files/a_new_agenda_with_mexico.pdf)

As Mexico’s security crisis begins to recede, the two countries will also have to do far

more to strengthen the governments of Central America , which now face a rising tide of violence as organized crime groups move southward . Mexico is also a U.S. ally in deterring terrorist threats and promoting robust democracy in the Western Hemisphere, and there will be numerous opportunities to strengthen the

already active collaboration as growing economic opportunities reshape the region’s political and social landscape.

Central American Instability causes global warRochlin, 1994[James Francis, Professor of Political Science at Okanagan University College. “Discovering the Americas: the evolution of Canadian foreign policy towards Latin America,” p. 130-131]

While there were economic motivations for Canadian policy in Central America, security considerations were perhaps more important. Canada possessed an interest in promoting stability in the face of a potential decline of U.S. hegemony

in the Americas. Perceptions of declining U.S. influence in the region – which had some credibility in 1979-1984 due to the wildly inequitable divisions of wealth in some U.S. client states in Latin America, in addition to political repression, under-development, mounting external debt, anti-American sentiment produced by

decades of subjugation to U.S. strategic and economic interests, and so on – were linked to the prospect of

explosive events occurring in the hemisphere. Hence, the Central American imbroglio was viewed as a fuse which could ignite a cataclysmic process throughout the region.

Analysts at the time worried that in a worst-case scenario, instability created by a regional war,

beginning in Central America and spreading elsewhere in Latin America, might preoccupy Washington to the extent that the United States would be unable to perform adequately its important hegemonic role in the international arena – a concern expressed by the director of research for Canada’s Standing Committee

Report on Central America. It was feared that such a predicament could generate increased global instability and perhaps even a hegemonic war. This is one of the motivations which led Canada to become involved in efforts at regional conflict resolution, such as Contadora, as will be discussed in the next chapter.

Border Infrastructure K to relations

Efficient cross-border trade key to relationsSeelke 13 (Clare Ribando, specialist in Latin American affairs, “Mexico’s New Administration: Priorities and Key Issues in U.S.-Mexican Relations,” 01/16/2013, http://www.fas.org/sgp/crs/row/R42917.pdf, AC)

(

The bilateral trade relationship with Mexico is of key interest to Congress because of Mexico’s ¶ proximity, the high volume of trade with Mexico, and the strong cultural and economic ties ¶ between the two countries. The United States and Mexico have strong economic ties through the ¶ North

American Free Trade Agreement (NAFTA), which has been in effect since 1994. Since the ¶

implementation of NAFTA, U.S.-Mexico trade has quadrupled, with the value of total bilateral ¶

trade reaching some $460 billion in 2011.32 Mexico ranks third as a source of U.S. imports, after ¶

China and Canada, and second, after Canada, as an export market for U.S. goods and services. ¶ The value of U.S. foreign direct investment (FDI) in Mexico has risen from $17 billion in 1994 to ¶ $91.4 billion in 2011, a 440% increase.33 Most studies show that the net economic effects of ¶ NAFTA on both the U.S. and Mexican economies have been small but positive, though there have ¶ been adjustment costs to some sectors within both countries. Congress has monitored the ¶ implementation of NAFTA, the effects of NAFTA on the U.S. and Mexican economies, and the ¶ resolution of NAFTA-related trade disputes. ¶ Most analysts expect Mexico’s trade policy under the Peña Nieto Administration to be relatively ¶ similar to that of the Calderón government, albeit with a more aggressive emphasis on ¶

diversifying Mexico’s trade partners. President Peña Nieto has put forth proposals for

deepening ¶ North American integration (such as the establishment of a North American infrastructure fund) ¶ and improving efficiency at the U.S.-Mexican border. He also supports Mexico’s active ¶ participation in negotiations for a Trans-Pacific Partnership (TPP) trade agreement.34 At the same ¶ time, Peña Nieto has also vowed to bolster Mexico’s trade ties with China, Europe, and Latin ¶ America, including trade with the Pacific Alliance (Chile, Peru, and

Colombia) and Brazil. ¶ In its legislative and oversight capacities, the 113th Congress may face numerous issues related to ¶ trade that could affect U.S.-Mexican economic relations. For example, the Obama Administration ¶ has made the proposed Trans-Pacific Partnership (TPP) free trade agreement a top trade priority. ¶ The United States, Canada, and Mexico, along with eight other countries,35 are participating in ¶ the TPP negotiations. If implemented, the TPP potentially could eliminate tariff and non-tariff ¶ barriers to trade and investment among the parties and could serve as a template for a future trade ¶ pact among Asia-Pacific Economic Cooperation (APEC) members and potentially other ¶ countries. If negotiations continue to move forward, they may affect the rules governing North ¶ American trade that have been in effect since NAFTA entered into force.

Engagement key to strong relations with MexicoFarnsworth and Werz 12 (Eric and Michael, vice president of the Council of the Americas and Americas Society and senior Fellow at the Center for American Progress, respectively, “The United States and Mexico: The Path Forward,” Center for American Progress, http://www.americanprogress.org/issues/security/news/2012/11/30/46430/the-united-states-and-mexico-the-path-forward, AC)

On the economic front, the success of the new Mexican administration’s economic reform and growth agenda is a core interest of the United States. A number of policy

fields will be crucial to create a successful North American growth model and will elevate the transactional partnership with Mexico to a strategic relationship much

like the United States enjoys with Canada. To achieve this goal, both countries must address a number of issues simultaneously.¶ The creation of jobs will play a central role in domestic politics in both

countries. U.S-Mexican trade needs to be encouraged in the border region and beyond. To achieve this, the U.S.-Mexican border needs to

be more permeable and allow more crossings at lower cost.¶ To secure energy independence, both countries need to prioritize research and development investments to ensure that technologies that facilitate access to shale gas—such as horizontal drilling combined with hydraulic fracking—do not adversely affect the environment. This is a necessary step to move forward with the development of massive North American shale gas resources—a potential strategic game-changer.¶ Mexican states along the U.S. border are official observers in the Western Climate Initiative, joining California and four Canadian provinces. The federal governments in both the United States and Mexico should take aggressive steps to make it more feasible for these Mexican states to become full partners in the initiative to achieve meaningful reductions in carbon pollution and move toward greater U.S.-Mexican cooperation on future North American pollution cuts.¶ Both countries need to expand their economic relations with Asia and Europe. President-Elect Peña Nieto sees China as an important future partner for economic growth. Both Mexico and Canada were invited in June to join the negotiations toward the Trans-Pacific Partnership—an important if belated step. Both should also be included at the very beginning of discussions with Europe—should they occur as has been rumored—toward the creation of a

free trade zone in the Atlantic. Such trade negotiations would provide an added means for the three North American economies to build cooperation.¶ The war against cartels and gangs involved in the illegal drugs trade continues to rage on both sides of the border, although indications of progress include a reduction in violence, cleaned-up cities, and increasing professionalization of the Mexican security forces. Achieving a reduction of violence will be a key challenge for President-Elect Peña Nieto, with street protests demanding as much. Judicial reform is moving forward, albeit slowly, but Mexican authorities still rely too greatly on confession by apprehended suspects and have deficits in the acquisition and use of intelligence. This fight needs to be framed as a joint challenge, emphasizing the co-responsibility of the United States, as Secretary of State Hillary

Clinton has expressed several times.¶ The re-launch of a U.S.-Mexican bilateral commission would be an important vehicle to institutionalize cabinet-level discussions across the broad range of issues that affect our countries and maybe trilateralize along with Canada from time to time. Tone and perception count a lot in the bilateral relationship. In addition, both sides should establish permanent working groups to help change the image and perception of Mexico in the United States and vice versa. Such an engagement in public diplomacy could include messaging and outreach to counter the often-distorted perception of Mexican society in the United States.

Border infrastructure is the vial internal link to US-Mexican RelationsCSIS, 04 - Bipartisan domestic and foreign policy think tank, conducting policy studies and strategic analyses on political, economic and security issues (Center for Strategic and International Studies, “U.S.-Mexico Border Security and the Evolving Security Relationship,” U.S.-Mexico Binational Council, 4/15/04, http://csis.org/files/media/csis/pubs/0404_bordersecurity.pdf)//AR

The flow of people and goods is already enormous and, barring unforeseeable calamities that could provoke major and continuing disruptions along the border, it will steadily grow as both economies

expand and integrate. Given the enormous number of people and volumes of goods that legally—and illegally—cross the border in this age of international terrorism against innocent civilian targets, the multifarious dimensions of cross-border security have been elevated to an unprecedented level of importance in the United States.

There can be no doubt that the future of Mexico-U.S. relations will for the indefinite future be shaped to a large degree by how the two countries work together to manage, selectively inspect, and regulate cross-border traffic. One objective, which will perhaps be of equal importance in both countries, is that no attack on the United States be perpetrated from terrorist bases in Mexico or that no terrorists easily cross the border on their way to attacking U.S. targets. In the United States, it is highly unlikely that there will be any significant partisan political disagreements about these and related imperatives of border security. In

short, this bilateral relationship is among the most strategically

important the United States has anywhere in the world. The long, porous border and the practical impossibility of ever establishing mechanisms that could reliably monitor all of the human and material traffic across the border create a harrowing dilemma for U.S. officials in Congress

and the executive branch. Perhaps the only certainty in this context is that greater and greater border and security cooperation will be called for.

Inefficiencies in border infrastructure remains a sore spot in relations – only bilateral efforts can solveRosenblum, 09 - Associate Professor of Political Science at the University of New Orleans (Marc R., “The United States and Mexico: Prospects for a Bilateral Migration Policy,” Social Science Research Council, 3/8/07, http://borderbattles.ssrc.org/Rosenblum/)//AR

Unilateralism and Bilateralism in Historical Context Despite a long history of shared culture and

geography, and despite migration patterns that long pre-date the modern border, neither the United States nor Mexico have consistently pursued cooperative approaches to managing migration. Indeed, the first five years of the Bracero Program (1942-1964) are the only clear bilateral success. More typically, actors in one or the other country—or both—have seen their national interest in migration best met through unilateral policy choices; and

migration relations have often been a source of conflict. Conflict in the early twentieth century concerned competition to control Mexican labor flows. With Mexico experiencing regional labor shortages after its bloody revolution, and with Mexican elites favoring a labor-intensive development strategy, the state discouraged emigration and actively encouraged return flows. These economic considerations were reinforced by ideological and security concerns in the wake of three US invasions of Mexico since the 1840s. As a result, Mexicans resented unilateral US recruitment of “guest-workers” during World War One, especially because US employers often failed to uphold their end of guest-worker contracts. Conflict intensified under the nationalist Mexican President Lázaro Cárdenas when over a million Mexicans—as well as many US citizens of Mexican descent—were rounded up and summarily deported to Mexico during the Great Depression. World War Two marked a turning point for US policymakers because labor shortages took on immediate national security implications, and a decade of Mexican out-migration during the 1930s had disrupted traditional circular migration patterns, making unilateral recruitment unreliable. At the same time, Mexico had responded to a US boycott of Mexican oil in 1938 by forging a commercial alliance with Germany; and Mexico’s loyalty to the United States in the coming war was far from certain. Thus, the Roosevelt administration resisted growers’ demands for a World War One-style guest-worker program, and instead directed diplomats to negotiate a bilateral agreement to ensure American access to Mexican workers, and also to bring Mexico into the allied war effort. Under the resulting “Bracero” agreement, Mexican workers were guaranteed a minimum wage (unlike American farm-workers) as well as transportation, housing, and health benefits. In contrast with the World War One system, Bracero contracts were generally adhered to, with Mexican consuls in the United States playing a direct oversight role, and with the Roosevelt administration siding with Mexico over US employers in a series of contract disputes during the war. Aggressive enforcement of Bracero contracts ended after 1948, and cooperation remained elusive for the next five decades. First, the bilateral Bracero agreement was renegotiated a half-dozen times by 1954, and the mature version of the program put in place at that time was highly exploitative of Mexican workers. Even so, Mexican policymakers valued access to US labor markets and sought a new agreement after 1964 only to be rejected by the Johnson and Nixon administrations. This pattern reversed in the 1970s when then US Presidents Ford and Carter saw a migration deal as a way to obtain privileged access to Mexican oil. But by this time Mexico was satisfied with a laissez faire migration system, and refused the American overtures. Increasing undocumented immigration throughout this period led to new migration control efforts. But with U.S.-Mexican relations strained by conflicts over the Central American civil wars, Mexican involvement in the US drug trade, Mexican electoral scandals, and Mexico’s debt crisis, neither country saw migration cooperation as a viable alternative during the 1980s; and Mexico refused an invitation to testify before the Senate Foreign Relations Committee during the debate over the Immigration Reform and Control Act

(IRCA) of 1986. Labor flows were likewise omitted from North American Free Trade

Agreement (NAFTA) negotiations. And both countries have mainly emphasized unilateral migration policies since this time, including through separate approaches to policing the border (with Mexico focusing on human rights

rather than migration control) and separate programs to identify Mexican migrants within the United States (with the United States focusing on removal and Mexico on political mobilization). Yet the nearly simultaneous inaugurations of Carlos Salinas and George Bush in 1988-89 represented a turning point in the broader relationship as both countries sought to

repair strained relations. Thus, aggressive US enforcement at the border since the mid-90s has been combined with a series of small-scale bilateral programs to improve border-level communication, cooperate on the logistics of migrant removals, improve humanitarian conditions in the border area, and target development dollars to high emigration areas. Mexico’s successful engagement with the United States on the NAFTA agreement and the increasing mobilization of Mexicans within the United States have also encouraged new efforts by interest groups and by Mexican politicians to abandon the presumption that migration policy is simply a sovereign US policy area, and to reframe the issue as a legitimate subject for bilateral discourse.

Border infrastructure key to revamp Mexican influence in American politics – revitalizes relationsRodriguez, 05 - Associate Professor of Political Science at the University of New Orleans (Raul., “Parameters of Partnership in U.S. - Mexico Relations Challenges in Competitiveness: Infrastructure Development,” Wilson Center Mexico Institute, January 2005 www.wilsoncenter.org/sites/default/files/Infrastructure.Rodriguez.doc)//AR

All in all, the bilateral relationship over the past ten years has been better than ever before. However,

cooperation has not and will not evolve naturally; it needs to be enhanced. How does Mexico persuade relevant players in the U.S. to expand binational efforts in the midst of dire fiscal and current account deficits and protectionist trends, when improving the standard of living of a developing nation is not a priority for the average American?

A first task is to find common ground and opportunities for joint gains. Trans-boundary issues and impacts will help identify those mutual benefits and build shared commitments. The Partnership for Prosperity agreement launched in September 2001 by Presidents Bush and Fox is a positive step and a good framework. It recognizes that infrastructure, transportation, logistics and security are pillars of a competitive North America as a whole. It supports studies and financing vehicles for new ventures, but a review of its performance renders rather modest achievements so far. More needs to be done under that framework, as well as under the 22-Point U.S.-Mexico Border Partnership Action Plan.The Border Environment Infrastructure Fund, appropriated through the U.S. Environmental Protection

Agency and managed by the North American Development Bank (NADBank), is a precedent that

should be preserved and increased. It is funding over $500 million in water and wastewater infrastructure relevant for both sides of the border, making projects affordable for communities by combining tailored grant funds with loans.

Initiatives for a North American Investment Fund linked to performance are being discussed in different forums, as evidenced by U.S. Senator John Cornyn’s Bill S. 2941, introduced on October 7, 2004.Mexico achieved a significant presence in the U.S. during the negotiation of NAFTA, gaining a respected voice in government, business,

academic, and civic circles at different levels. That lobbying capacity -- in its broadest connotation -- has dwindled since. It needs to be rebuilt judiciously. The linchpin for that effort should be the joint gains that could derive from greater cooperation in security, market expansion, energy, and demographic matters.34rt rfc54

China I/L

Mexico relations key to wider influence in Latin AmericaFunaro, 13 (Kaitlin, June 04, Global Post “Xi flies to Mexico as China battles US for influence in Latin America” http://www.globalpost.com/dispatch/news/regions/asia-pacific/china/130604/xi-flies-mexico-china-battles-us-influence-latin-ame)//YS, accessed 6/28/13

Chinese President Xi Jinping is making the most of his four-country tour of the Americas

to position China as a competitor to the US and Taiwan's economic influence in the region. Xi arrives in Mexico Tuesday for a three-day visit in which he and Mexican President Enrique Peña Nieto are expected to discuss their economic ties. The two nations are economic partners but also competitors, particularly when it comes to exports to the United States. Mexico and China both enjoy strong exports to the American market but Mexico itself has been flooded with cheap Chinese goods that are displacing domestic goods. "China is a complicated case" for Mexico, Aldo Muñoz Armenta, political science professor at theAutonomous University of Mexico State told USA Today. "It's not the healthiest (relationship) in diplomatic terms because the balance of trade has been so unequal."

When it comes to economic influence, China may be gaining the upper hand in Latin America. China is increasing its funding to the region just as the US has been coming under pressure to cut aid and investment. "If I’m a Latin American leader, I’m very happy because I now have more chips to play with, "Kevin Gallagher, author of the 2010 book "The Dragon in the Room," about China’s inroads in Latin America, told Bloomberg.

Broader Latin America I/L

U.S.-Mexican relations will determine U.S.-L.A relationsCFR, 13 (Council on Foreign Relations, an independent, nonpartisan membership organization, think tank, and publisher, “Latin America Studies Program”http://www.cfr.org/projects/south-africa/latin-america-studies-program/pr1039)//YS, accessed 6/28/13

Latin America is emerging as a region of increasing differentiation. While seeking greater integration, independence, and sustainable growth, it faces significant challenges to achieving these goals.

Mexico and Brazil stand out as leaders within Latin America and are today's bellwethers for how the region will fare in the next decade. How successful leading countries such as Mexico and Brazil are in confronting local and

global challenges will set the tone within the region in years to come as well as for relations with the United States.

Perception triggers the plan

Perception of the plan is key – Obama has to send a strong message to solve relationMontealegre, 12 – a Los Angeles-based Diplomatic Courier Contributor and a freelancer specializing in Latin American markets, finance, economics, and geopolitics. He holds an MA in International Relations from the University of Westminster-London (Oscar, “U.S.-Mexico Relations: Love Thy Neighbor,” Diplomatic Courier, 1/24/13, http://www.diplomaticourier.com/news/regions/latin-america/1331)//AR

Yet there is hope that President Obama will fix the broken system with a more humane approach, contrary to laws that are being pushed and backed by the Republican Party in Arizona, Georgia, and Alabama. Some may ask—what does this have to do with Mexico, or even Latin America? It is all about messages, and in the next four years the President must use the available tools to solidify relationships with its partners, paving the road for more trade and commerce, which ultimately will further strengthen the U.S. economy. What happens in the U.S. means a lot to many countries, and immigration is perhaps one of the most important matters in Mexico, Central, and South America.The U.S. must first focus on re-branding its relationship with Mexico. President Obama and Mexican President Peña Nieto need to formulate a new agenda between the two countries—one that resonates with the 21st century, linking the two countries economically; where the U.S. can envision Mexico as a vibrant emerging market in its own backyard. Obstacles do exist, like the current Mexican drug war and political corruption.  

Relations U – Relations low

US – Mexican Relations are declining – backlash to drug war and trade disputesHickson, 12 News Associate at NBC News in New York. (Alessandra, “Peña Nieto hopes to reframe US-Mexico relations in meeting with Obama,” NBC Latno, 11/26/12, http://nbclatino.com/2012/11/26/pena-nieto-hopes-to-reframe-us-mexico-relations-in-meeting-with-obama/)//AR

“I think particularly from the Mexican side, there’s a real desire to rebalance the relationship,” says Eric

Olson, Senior Associate of the Latin American Program at the Wilson Center. “There’s a perception and feeling that the security issue became the exclusive focus of the relationship [between Mexico and the US]. They want to make sure the economy and global aspects of the relations aren’t lost or subsumed. [Mexico] wants to make sure US policy makers don’t just think about security issues. And I think that State Department and the White House are happy to go along with that reframing,” he says.¶ The desire to rebuild or shift the framing of the relationship between the two nations is why Olson says the meeting, though short, is not a photo-op.¶ “It’s not going to be detailed, deep conversation. But I think the US and President Obama want a strong commitment from Peña Nieto to continue combating organized crime. Peña Nieto wants strong commitment to focus on how they can grow together and trade,” he says. “They’ll start to set the tone of their personal relationship and what they want to see.”¶ Maureen Meyer, Senior Associate for Mexico and Central America at the Washington Office of Latin America (WOLA), agrees that Peña Nieto will want a different and deeper relationship with the U.S. “I

think Peña Nieto would like a to see a broader relationship between the two nations. But I think there’s a sense of how do you expand the benefits,” she says. “You’ll want to continue cooperation on security, but there was just a security issue with US embassy employees who were shot at. You want to expand trade, but there are trade disputes they need to get over before they can expand.”¶ Experts believe that Mexico won’t just want better trade with the U.S., but also with Canada. Meyer believes that Mexico will look for a North American trade alliance and energy cooperation between all three nations, especially since Peña Nieto has mentioned energy as an issue he hopes to work on.¶ “I think Mexico has long wanted strong integration between the three countries and has wanted Canada as a partner,” says Olson, but he notes that Canada has been a reluctant partner despite Mexico’s growing economy. Mexico is the new home to state-of-the-art automotive assembly plants for Nissan and Audi and may have an economy that is growing faster than Brazil’s, notes Olson. It’s this growth that may lead to better relations and has some experts suggesting that Mexico will be the top trading partner for the US by the year 2018.¶ While energy reform, trade, education and migration will be touched on, the conversation always comes back to

the war against drugs. With the legalization of marijuana in Colorado and Washington, many experts have shot down any notion that it will affect federal policy or change the mind of Peña Nieto, who has said he doesn’t support legalization as a method to ending drug cartel violence. Still, the issue of drugs — or more accurately the toll of drug production and trafficking — is of great value to Mexico.

***Nieto***

1ac

Plan provides momentum for Nieto’s reform agenda – US action is keyFarnsworth and Werz, 11/30/12 – Eric, vice president of the Council of the Americas and Americas Society, and Michael, Senior Fellow at the Center for American Progress (“The United States and Mexico: The Path Forward,” Center For American Progress, http://www.americanprogress.org/issues/security/news/2012/11/30/46430/the-united-states-and-mexico-the-path-forward/)

Mexico inaugurates a new president on Saturday—Enrique Peña Nieto of the Institutional Revolutionary Party. Given the early lead he enjoyed during the campaign and the public fatigue with the ruling National Action Party, Peña Nieto, the former governor of the state of Mexico, ran on generalities and never clearly defined his political philosophy or presidential agenda. Much of what he campaigned on could be boiled down to two statements: “I’m not the National Action Party, and I’m not the old Institutional Revolutionary Party.” Good enough, as far as the election result goes: Peña Nieto was elected with close to 40 percent of the vote, a plurality but not a majority—in part because many voters retain a strong distrust of the Institutional Revolutionary Party and its autocratic past. It is now up to the president-elect to fill in the blanks as to what kind of president he will be. If all goes well, he could be transformational. But obstacles loom and initial expectations must be held in check. The country has solid standing. Economic growth is strong and projections show continued expansion, surpassing even Latin American darling Brazil. The middle class is growing, with greater access to goods and services and the ability to purchase them. Manufacturing is moving back to Mexico from China, with Mexico becoming a platform both for production in North America and also in Latin America. The country has also become a leading voice in global trade, as well as economic and environmental initiatives. Mexico is becoming economically what it has always been geographically: the crucial link between North and South America. The outgoing government has effectively used its final days in office to promote a reform agenda consistent with Peña Nieto’s stated views. Mexico has one of the longest transition periods of any democracy—five months. While outgoing governments have traditionally done little during this period, this particular transition period has proven different, particularly with regard to the charged issue of strong protections for labor that have been loosened through new legislation in recent weeks. Working together, the National Action Party executive and the Institutional Revolutionary Party-controlled legislature have joined to give the incoming Peña Nieto government a strong tailwind toward economic opening and greater competition, without having to pay the political cost that labor reform might otherwise have entailed. At the same time, north of the border, President Barack Obama has spoken clearly of his desire for meaningful immigration reform this year, which would provide another significant political and economic boost to the new Mexican president.

With labor reform out of the way, attention turns to the three policy fields that Peña Nieto has promised to address, perhaps all at once: energy reform, tax reform, and Social Security reform. Should he succeed in addressing these issues effectively, he will have restructured a significant part of Mexico’s economy, preparing Mexico for an economic takeoff that could rival Asian economies. This effort brings risk as well as promise, since failing with these fundamental reforms could throw Peña Nieto’s presidency into turmoil at its inception. Each of these reforms individually would be enough to occupy the Presidential Palace Los Pinos for months and to soak up the political capital of any president. Doing all of them together would be a political project more involved than any other since the

Institutional Revolutionary Party first restructured Mexico’s economy in the 1930s. Clearly, the political stakes are huge. A major obstacle to reform could be the Institutional Revolutionary Party itself. Party

discipline will largely ensure a supportive if not compliant congressional delegation, but party bosses, governors, and individual congressional representatives, among others, will likely seek to ensure that their political equities are protected in any reform process. Peña Nieto’s challenge will be to keep them in line, using traditional tools of political coalition building without stepping over the line into corruption. A number of younger, newly elected members of the Mexican Congress in the leftist Party of the Democratic Revolution have indicated that the deepening of democratic reform is their main priority and that there might be room for cooperation with President-Elect Peña Nieto should he push this agenda. The fate of the reform agenda will arguably be the new president’s greatest and most immediate test. He faces a Mexican public that no longer tolerates the old ways of doing politics in Mexico and is skeptical that the Institutional Revolutionary Party has truly changed. But equally importantly, the party has been out of power for 12 years and its leaders now want and expect to

receive the rewards that national power bestows. It will be a delicate balancing act for Peña Nieto. But his inauguration also has implications for U.S.-Mexico relations, which will play out on both sides of the

border. The path forward Given this backdrop, the new Mexican president needs major political and policy successes in 2013 to consolidate power within his own party and secure congressional majorities for an ongoing economic reform process. Here, the United States has an important

role to play: The two countries are intertwined in a unique way and thus the political success of Enrique Peña

Nieto will, at least in part, be impacted by what happens north of the border. And the to-do list for the United States is extensive, but it is largely focused on economic policy and immigration reform. Immigration reform is increasingly likely to dominate the domestic debate once the fiscal cliff is resolved. President-Elect Peña Nieto made a strong endorsement of immigration reform at his Washington press conference with President Obama this week, stating that he fully supports President Obama’s proposal. Even though a strong majority of Americans support a pathway to citizenship for the 11 million undocumented immigrants living in the country, it will remain a difficult legislative battle. And while aligning with a popular U.S. president who will be viewed as fighting to legalize Mexican nationals makes obvious sense, there is some risk that a failed legislative effort will trigger collateral damage to Peña

Nieto’s image in Mexico. On the economic front, the success of the new Mexican administration’s economic reform and growth agenda is a core interest of the United States. A number of policy fields will be crucial to create a successful North American growth model and will elevate the transactional partnership with Mexico to a strategic relationship much like the United States enjoys with Canada. To achieve this goal, both countries must address a number of issues

simultaneously. The creation of jobs will play a central role in domestic politics in both countries. U.S-Mexican trade needs to be encouraged in the border region and beyond. To achieve this, the U.S.-Mexican border needs to be more permeable and allow more crossings at lower cost. To secure energy independence, both countries need to prioritize research and development investments to ensure that technologies that facilitate access to shale gas—such as horizontal drilling combined with hydraulic fracking—do not adversely affect the environment. This is a necessary step to move forward with the development of massive North American shale gas resources—a potential strategic game-changer. Mexican states along the U.S. border are official observers in the Western Climate Initiative, joining California and four Canadian provinces. The federal governments in both the United States and Mexico should take aggressive steps to make it more feasible for these Mexican states to become full partners in the initiative to achieve meaningful reductions in carbon pollution and move toward greater U.S.-Mexican cooperation on future North American pollution cuts. Both countries need to expand their economic relations with Asia and Europe. President-Elect Peña Nieto sees China as an important future partner for economic growth. Both Mexico and Canada were invited in June to join the negotiations toward the Trans-Pacific Partnership—an important if belated step. Both should also be included at the very beginning of discussions with Europe—should they occur as has been rumored—toward the creation of a free trade zone in the Atlantic. Such trade negotiations would provide an added means for the three North American economies to build cooperation. The war against cartels and gangs involved in the illegal drugs trade continues to rage on both sides of the border, although indications of progress include a reduction in violence, cleaned-up cities, and increasing professionalization of the Mexican security forces. Achieving a reduction of violence will be a key challenge for President-Elect Peña Nieto, with street protests demanding as much. Judicial reform is moving forward, albeit slowly, but Mexican authorities still rely too greatly on confession by apprehended suspects and have deficits in the acquisition and use of intelligence. This fight needs to be framed as a joint challenge, emphasizing the co-responsibility of the United States, as Secretary of State Hillary Clinton has expressed several times. The re-launch of a U.S.-Mexican bilateral commission would be an important vehicle to institutionalize cabinet-level discussions across the broad range of issues that affect our countries and maybe trilateralize along with Canada from time to time. Tone and perception count a lot in the bilateral relationship. In addition, both sides should establish permanent working groups to help change the image and perception of Mexico in the United States and vice versa. Such an engagement in public diplomacy could include messaging and outreach to counter the often-distorted perception of

Mexican society in the United States. The election of Enrique Peña Nieto and the re-election of President

Obama mean that the U.S.-Mexican relationship has a unique opportunity to grow closer and bring numerous

benefits to both sides of the border. To fully appreciate this unique opportunity, both sides must invest political capital and be prepared to engage domestic public opinion when it comes to explaining why our countries are united by much more than a fence.

Plan’s a success for Nieto Navarrette, 11/26/12 (Ruben, “To-Do List for Obama and Mexico's New President,”

CNN, http://pvangels.com/news-mexico/4362/to-do-list-for-obama-and-mexicos-new-president)Red

Those people are now taking another look at the PRI. The way they see it, the party may have been corrupt, but at least it was competent. Unlike the PAN, whose leaders seem obsessed with causes and crusades - for Fox, defending Mexican immigrants in the United States, and for Calderon, the drug war - the PRI kept the trains running on time.  As many

Mexicans see it, the country needs to move on to other business. They expect Pena Nieto to lead the way. They may not want a complete and unconditional surrender to the drug cartels, but they could live with an accommodation that included an end to the violence. The battle against the drug cartels is sure to be on the agenda Tuesday when Pena Nieto is scheduled to visit the White House and meet with President Barack Obama. I had the chance to meet Pena Nieto during my trip and hear about his vision for building a new and improved Mexico. Despite the knocks that he has taken from the Mexican press and the elites for not appearing to be book-smart, he has more

than his share of "EQ" - emotional intelligence. This will carry him far with a Mexican public that, at this

point, wants to have leaders that it can relate to, who will address its everyday concerns. Like a certain recent U.S. president from Texas, Pena Nieto is taken lightly by many as he enters the office. Yet sometimes being underestimated can be helpful. And just as George W. Bush reached the height of his popularity after the terrorist attacks of September 11, 2001, Pena Nieto might yet surprise his critics and rise to the challenge of dealing with a major crisis when faced with one. In his meeting with Obama, the Mexican president-elect is likely to dwell on what he believes the U.S. can accomplish for Mexico. This will probably include delivering the last few hundred million dollars worth of equipment and supplies that is owed to Mexico to help it fight the drug cartels under the $1.4 billion Merida Initiative; safeguarding the rights of Mexican immigrants in the United States regardless of legal

status; and supporting the creation of a North American trade alliance (the US, Mexico and Canada) that could compete with Asia and the European Union on the stage of global commerce. But Pena Nieto should also focus on what Mexico can accomplish for the United States. He could pledge to continue the drug war and keep the pressure on the cartels, in the spirit of the Merida Initiative; vow to create more jobs and better-paying jobs in Mexico, especially in the poorest regions that produce most of the illegal immigrants to the United States; commit himself to addressing the severe inequalities between Mexicans, closing the huge gap between rich and poor, and expanding the middle class in a country where more than 50% of the population still lives in poverty; and pledge to open up the Mexican petroleum industry to investment from North America and partnerships with American and Canadian oil

companies. All of this would benefit not only the relationship between Mexico and the

United States, but also the lives of Mexicans.Those people seem to be tired of crusades. Now, it appears

that they want their leaders to focus on the basics: creating better-paying jobs, protecting the

population,expanding trade, improving access to technology, developing infrastructure in rural areas, and improving relations with foreign countries and trade partners. Those are some of the challenges facing Enrique Pena Nieto. How he addresses them will tell us whether the Mexican people who elected him, and returned his party to power, made a wise choice or a bad mistake.

Nieto is building up political capital for oil reform – getting major wins allows him to achieve his agendaArchibold, 3/22/13 (“New Leader Taps Mexican Discontent to Press Agenda of Change,” NYT, http://www.nytimes.com/2013/03/23/world/americas/new-leader-taps-mexican-discontent-to-press-reform-agenda.html?_r=0)

It is that well of popular frustration — over poor cellphone service, limited programming on television, flagging schools — that President Enrique Peña Nieto has tapped in a series of attention-getting moves that he promises will “ transform Mexico ” and accelerate growth in an economy that has expanded too slowly to lift the country out of the developing world. He has promised to bring competition and more government oversight to the telecommunications market, taking aim at the monopoly-like control by one of the richest men in the world, Carlos Slim Helú. Also in the president’s sights is the giant media company Televisa, which dominates broadcasting through four networks and would face renewed competition under a proposal that could lead to the creation of two new channels. And his government has jailed the boss of the teachers’ union, the largest in Latin America, on accusations of

embezzlement as part of a sweeping move to wrest full control of the schools from it. It remains to be seen how any of the changes will turn out ; Mexico has a long tradition of bold, finely shaped laws that are ultimately watered down or simply not enforced. The telecommunications

proposal passed one chamber of Congress late Thursday and is now headed to the Senate. But it seems

clear that Mr. Peña Nieto has banked substantial political capital and bolstered his popularity, which may add momentum to thornier changes he plans, including opening up the state oil monopoly , long a source of national pride, to private investment. The teachers’ union, Mr. Slim, Televisa — the targets, in the minds of many

Mexicans, are hard to cheer for. “ He is trying to gain credibility and popularity ,” said Helena Varela Guinot, a political scientist at the Ibero-American University in Mexico City. “He is saying , ‘ I am a president that gets results, this is a government that is efficient , takes risks and goes after the big problems ,’ although it is not clear in reality if his reforms will achieve the desired results.” Those who remember the autocratic ways of Mr. Peña Nieto’s party, which governed Mexico for more than 70 years but was then ousted from power for 12, see a presidential power play that may yet deliver results, but with less space for those who disagree. “His goal is to reshape the power of the presidency,” said Sergio Aguayo, a political analyst at the Colegio de México. “Not to the level it used to be, because that is impossible. But he is

a true believer that Mexico needs a ‘presidentialist’ system.” Some analysts see in his priorities a clear sign that he does not want his tenure defined by the country’s security problems , with thousands killed or missing in a war against drug and

organized crime groups. Mr. Peña Nieto has argued that improving the economy and education in the long run will bring down the violence , and he has said little about the day-

to-day mayhem that afflicts many parts of the country. That may simply reflect the concerns of Mexicans, who rank the economy as a greater concern than crime. “The same issues identified now are the same issues identified in the previous three presidential elections as top concerns: poverty, underemployment and economic growth,” said Roderic Ai Camp, a Mexico scholar at Claremont McKenna College in California who has written an analysis of Mr. Peña

Nieto’s cabinet. Still, the new president now faces the challenge of turning proposals into laws and, more important, carrying them out.

Nieto’s energy reform is key to natural gas pipeline developmentCASILLAS 1/28/13 (Juan; Consultant Based in Mexico City; “Mexico’s Upcoming Energy Reform: Opportunities, Limitations, and Challenges,” Manatt Jones Global Strategies, http://www.manatt.com/ThreeColumn.aspx?pageid=199&id=124583)

Mexico's hydrocarbons sector will not be overhauled under Mexico's new President Enrique Peña Nieto to the point of the State losing ownership and control of the resource, but reforms that offer new business opportunities are likely. The reform effort for the oil and gas sectors is scheduled to be launched in the first year of the President's six-year term. While the major political parties in Mexico all acknowledge the need for

reform, they do not agree on the "what" and the "how." Oil production has been in decline, and Pemex does not have the capital or technology to fully tap into all the country's potential reserves of traditional fields or promising shale oil reserves. Reform is complicated, as Pemex, the national symbol of the country's oil resources, is a political force as well as a business. At least for the near term, Pemex will continue to be the cash cow for the Mexican government, providing up to 40% of the government's budget and allowing for revenue transfers to states. Pemex's inability to fully invest in new technology and exploratory activities to more efficiently extract from its aging oil fields is seen by declining oil production since 2008, when production peaked at 3.2 million barrels per day. The U.S. Energy Information Administration estimates that by 2020 Mexico will become an oil importer if at least moderate reforms are not

implemented. Furthermore, domestic economic growth will significantly increase Mexico's energy demands. The need for foreign investment in Mexico's energy sector is widely acknowledged, but political realities have and will continue to limit the extent of reform. The Pacto Por Mexico, the new Administration's legislative road map signed by the three major political parties—the PRI, PAN, and PRD—days after Peña's inauguration, paves the way for increased private investment in petrochemicals, hydrocarbon (pipeline) transportation, and refinery operations in Mexico, while reaffirming that Mexico's natural resources are and will continue to be the property of the State. Oil still property of the

State Without the option to own or partially own oil reserves, industry giants are less likely to be interested in investing in crude production. This month's

third round of incentive contracts for Chicontepec continues prior practices. However, Pemex's need for more efficient extractive technologies will persist, and Pemex and the government will be unable to fulfill the resource (investment and technology) gap. Reforms enacted in 2008 have allowed Pemex to enter into contracts with private firms that set a base level of production and incentivize any production above that base level. Mexico's oil and gas reserves remain lucrative, but aging wells, deep water wells, and oil and natural gas from shale present challenges Pemex has not been able to fully address, given the company's mandate of maximizing returns. This presents an opportunity for firms that are efficient and successful in managing these types of wells. However, current incentive-based contracts pass the investment and operating risks to private firms, which incur losses whenever the baseline amount is not met. Privatization of refinery operations, transportation of hydrocarbons, and petrochemicals Some hoped that campaign rhetoric meant a change to Mexico's Constitution that would have more fully opened up the energy sector to foreign investments and participation. However, the Pacto Por Mexico explicitly identifies refinery operations, oil and gas

transport, and petrochemicals as aspects of Pemex's operation that could be opened up for privatization. The form and extent of these reforms is yet undefined, but the current schedule is for Congress to consider them in the second semester of 2013, with implementation by the second semester of 2014. To date, the new Administration has taken on issues that it believes it can win, so calculations about what types of reforms will be successful come with an albeit early, but so far successful, track record. The need for investments in these industries is clear. In 2009 the Calderon Administration announced plans to build a refinery in Hidalgo, but regulatory and bureaucratic obstacles as well as technological, planning, and budget restraints prevented the initiation of construction. Today Mexico imports nearly half of its refined gasoline from the U.S. due to Pemex's insufficient refining infrastructure. Pemex currently co-owns a refinery in the U.S. and has explored buying a U.S. refinery to meet

domestic demand. Mexico's infrastructure capacity to transport natural gas is also lagging. Despite an abundance of cheap natural gas available in the U.S., Pemex has had to limit its gas supply to Mexican customers because of insufficient pipeline capacity. In the last quarter of 2012, CFE, the energy

agency, awarded contracts for new natural gas pipelines, but more are needed. Mexican manufacturing has the potential to grow dramatically to meet increasing domestic demand and to be more cost-efficient with access to cheap petrochemicals and plastics, but Pemex's "cracking" capabilities (the process of extracting petrochemicals from

crude oil and natural gas) requires significant investment. With the proper infrastructure and with access to crude and natural gas (the raw materials used to produce petrochemicals), Mexico is poised to become a large-scale producer and

even exporter of petrochemicals. However, the enormous infrastructural investments required for "cracking" facilities are beyond what Pemex and the Mexican government are able to provide and will require private-public partnerships with foreign companies. Technologically advanced companies, including many from the U.S., should have an edge in new opportunities.

Increased gas exports to Mexico will prevent LNG export approvalPEARSON and RAMIREZ 11/30/12 (Will; Global Energy Analyst – Eurasia Group and Carlos; Latin America Analyst – Eurasia Group, “Mexico – the North American Shale Revolution Heads South,” http://blogs.ft.com/beyond-brics/2012/11/30/guest-post-mexico-the-north-american-shale-revolution-heads-south/) ww

The North American shale gas revolution, currently confined to the US and Canada, could soon spread south to Mexico. Political decisions awaiting incoming President Enrique Peña Nieto will shape the timeline for the development of domestic shale resources. This timeline will in turn have ramifications on energy markets in the US, as well as the rest of the world. If Peña Nieto successfully opens the sector to private investment, US and Canadian firms with expertise in exploiting shale oil and gas will rush into Mexico. Nevertheless, regardless of the trajectory of its shale gas sector, Mexican imports of US shale gas will rise in the immediate future. Peña Nieto appears set to initiate a needed

discussion about Mexico’s energy future by pressing for a second energy reform in less than five years. But to develop

indigenous shale resources at a speed that matches Mexico’s needs, the government recognizes that it

must open up the domestic upstream sector to private sector participants with technological and operational expertise. And to lure companies with this kind of knowledge, Peña Nieto must propose a constitutional reform to allow state-owned energy company Pemex to form partnerships with private firms, which his administration intends to do as early as

February. The odds of achieving reform of Mexico’s hydrocarbons industry are better now than at any time since the 1938 nationalization of the sector. Surrounding Peña Nieto is a cadre of very committed technocrats who understand the enormous opportunity for Mexico to join the North American energy revolution. The potential economic benefits of embracing constitutional reform seem to be having a stronger influence on Peña Nieto than certain factions within his Institutional Revolutionary

Party (PRI) that have opposing ideas. That said, the obstacles to passage are formidable. First, the new president would have to convince a large segment of the population (62 per cent, according to two polls conducted in 2010) that remains wary of allowing more private investment in the industry. Also, he would require the support of the National Action Party (PAN), given that constitutional reform requires the approval of two-thirds of both congressional chambers. The PAN and the PRI do not have significant ideological differences regarding opening the sector to competition, though they do have divergent views on the role that the powerful Pemex union – a political ally of the PRI – should play in the company. Moreover, when outgoing President Felipe Calderon of the PAN proposed his own energy reform in 2008, the PRI vehemently rejected the idea of changing the constitutionand was even able to block some of the non-constitutional provisions of the Calderon proposal. Whether that episode returns to haunt the next government remains to be seen, but it will no doubt emerge as another controversial issue during the discussions next year. Lastly, there is the factor of leftist two-time presidential runner-up Andres Manuel Lopez Obrador. Even though his popularity has declined considerably in recent years, he remains capable of inflicting political damage by mobilizing people in the streets. The scale of any potential protests is another source of uncertainty as Peña Nieto weighs his options. Should these political risks be overcome, the upside for Mexico would be substantial. Directly south of the US border, the untapped Burgos Basin is an extension of the liquids-rich Eagle Ford formation in Texas, and according to the US Energy Information Administration, two-thirds of Mexico’s technically recoverable shale gas resources are located there. Many other shale basins are located along Mexico’s east coast, a geographic fit for the large pockets of gas demand in several of the country’s manufacturing areas that are currently suffering shortages. These gas shortages will likely spur construction of additional pipeline capacity from Texas, which faces a glut of shale

gas. Tapping more US supply would benefit Mexican end users and provide relief for shale gas producers in the US who are desperately seeking new demand outlets. However, exporting too much of this supply to Mexico could prove detrimental to the global LNG market. Although a tail risk at the

moment, the Obama administration is sensitive to the impact of gas exports on domestic gas prices, so a surge of shipments to Mexico could diminish appetite for approving US LNG projects in coming years.

U.S. LNG Exports would tank Russian Economic GrowthMEAD 4/25/12 (Walter Russell; James Clarke Chace Professor of Foreign Affairs and Humanities – Bard College, “North American Shale Gas Gives Russia Serious Headache,” http://blogs.the-american-interest.com/wrm/2012/04/25/north-american-shale-gas-gives-russia-serious-headache/) ww

North America’s shale gas boom is chipping away at the market for gas producers like Russia. What’s more, if the United States becomes a gas exporter, Russia’s customers (especially in Europe) could decide to cancel expensive contracts with Gazprom in favor of cheaper American natural gas. Here’s the story from the FT: “If the US starts exporting LNG to Europe and Asia, it gives [customers there] an argument to renegotiate their prices with Gazprom and Qatar, and they will do it,” says Jean Abiteboul, head of Cheniere supply & marketing. Gazprom supplied 27 percent of Europe’s

natural gas in 2011. While American gas is trading below $2 per MMBTU (million

British thermal units), Gazprom’s prices are tied to crude oil markets, and its long-term contracts charge customers roughly $13 per MMBTU, says the FT. European customers would love to reduce their dependence on Gazprom and start to import American gas. Already Gazprom has had to make concessions to its three biggest customers, and others are increasingly dissatisfied with their contracts. Worse, from Russia’s point of view: evidence that western and central Europe contain substantial shale gas reserves of their own. Fracking is unpopular in thickly

populated, eco-friendly Europe, but so are high gas prices. All this ought to give Russia serious heartburn. Eroding Gazprom’s dominance of the European energy market would be a major check on Russian economic growth and political influence.

The impact is extinction from global nuclear warFILGER 5/10/09 (Sheldon; Writer/Founder – GlobalEconomicCrisis.com, “Russian Economy Faces Disastrous Free Fall Contraction,” Huffington Post, http://www.huffingtonpost.com/sheldon-filger/russian-economy-faces-dis_b_201147.html) ww

In Russia, historically, economic health and political stability are intertwined to a degree that is rarely encountered in other major industrialized economies. It was the economic stagnation of the former Soviet Union that led to its political downfall. Similarly, Medvedev and Putin, both intimately acquainted with their nation's history, are unquestionably alarmed at the prospect that Russia's economic crisis will endanger the nation's political stability, achieved at great cost after years of chaos following the demise of the Soviet Union. Already, strikes and protests are occurring among rank and file workers facing unemployment or non-payment of their salaries. Recent polling demonstrates that the once supreme popularity ratings of Putin and Medvedev are eroding rapidly. Beyond the political elites are the financial oligarchs, who have been forced to deleverage, even unloading their yachts and executive jets in

a desperate attempt to raise cash. Should the Russian economy deteriorate to the point where economic collapse is not out of the question, the impact will go far beyond the obvious accelerant such an

outcome would be for the Global Economic Crisis. There is a geopolitical dimension that is even more relevant then the economic context. Despite its economic

vulnerabilities and perceived decline from superpower status, Russia remains one of only two nations on earth with a nuclear arsenal of sufficient scope and capability to destroy the world as we know it. For that reason, it is not

only President Medvedev and Prime Minister Putin who will be lying awake at nights over the prospect that a national economic crisis can transform itself into a virulent and destabilizing social and political upheaval. It just may be possible that U.S. President Barack Obama's national security team has already briefed him about the consequences of a major economic meltdown in Russia for the peace of the world. After all, the most recent national intelligence estimates put out by the U.S. intelligence community have already concluded that the Global Economic Crisis represents the greatest national security threat to the United States, due to its facilitating political instability in the world. During the years Boris Yeltsin ruled Russia, security forces responsible for guarding the nation's nuclear arsenal went without pay for months at a

time, leading to fears that desperate personnel would illicitly sell nuclear weapons to terrorist organizations. If the

current economic crisis in Russia were to deteriorate much further, how secure would the Russian nuclear arsenal remain? It may be that the financial impact of the Global

Economic Crisis is its least dangerous consequence.

Ext – Pemex Reform

Nieto needs political credibility to pass Pemex reformMartin, Rodriguez et. al. 13 (Eric, Carlos Manuel, June 20, Reporters for Bloomberg News based in Mexico, Bloomberg Businessweek, “Mexico's President Pushes Reforms for State Oil Company Pemex,” http://www.businessweek.com/articles/2013-06-20/mexicos-president-pushes-reforms-for-state-oil-company-pemex)//YS , accessed 7/01/13

Petróleos Mexicanos, known as Pemex, has long been the third rail of Mexican politics. The state-owned company, originally based on oil fields seized from foreign owners over 70 years ago, has produced sizable government revenue and union jobs for hundreds of thousands of Mexicans. Foreign

investment has been largely restricted. But now Pemex’s main asset, the giant Cantarell offshore field, is shrinking fast. The company says it needs to boost annual investment by 46 percent, to $37 billion, to tap undeveloped shale-gas deposits and deep-water reserves.

Without some private capital and expertise from abroad, Mexico risks becoming an importer in the next decade. Many of Mexico’s politicians and

policymakers have known this for years. Yet Mexican nationalism, resistance from the unions, and the sheer size of the task of transforming Pemex have stood in the way. The planets may be aligning for a solution: Mexican President Enrique

Peña Nieto says he’s negotiating to get the political support he needs to break the state monopoly in oil and gas exploration and production this year in a bid to accelerate Mexico’s economic growth. In the model envisioned by Peña Nieto, Pemex would develop certain fields, while foreign and private companies would tap others. The oil and gas reserves in the ground would still be the property of Mexico. Peña Nieto declines to discuss many details of the proposal or whether it would include a change in the constitution, which limits how private companies can profit from the nation’s energy resources. He has, however, been sending signals to international oil companies that he needs their help to arrest eight years of decline in Mexico’s crude output. “It’s obvious that Pemex doesn’t have the financial capacity to be in every single front of energy generation,” the 46-year-old president said in an interview in London on June 17, before he traveled to Northern Ireland for meetings with Group of Eight leaders. “Shale is one of

the areas where there’s room for private companies, but not the only one.” Peña Nieto says his administration will send the energy bill to Congress by September, when regular sessions resume. He’s relying on the Pact for Mexico, an alliance of the country’s top three political parties, which have vowed to work together to achieve major reforms. Peña Nieto’s own party, the

Institutional Revolutionary Party (PRI), doesn’t have enough votes on its own for a constitutional amendment. “We’re approaching key deadlines,” Peña Nieto says. “I’m optimistic that this political climate of understanding and agreement will be maintained.” Yet

investors have pushed down the price of Pemex bonds in the last month. They’re losing confidence in the president’s ability to achieve the needed changes amid signs that the Pact for Mexico is fraying. Corruption allegations against the PRI have already almost derailed the alliance. In April, the National Action Party, a member of the pact, released video and audio tapes allegedly showing officials from Peña Nieto’s party arranging to use government social programs to win support before local elections. The accord may end if Peña Nieto doesn’t prevent electoral irregularities in states where local contests will take place on July 7, said Jesús Zambrano, head of the Party of the Democratic Revolution, another member of the pact in May. “If the Pacto por México dies, then what’s the plan?” asks Duncan Wood, director of the Mexico Institute at the Woodrow Wilson International Center for Scholars in Washington. “We don’t know what the plan is after

that.” Peña Nieto has also waited a long time to make his push for a new oil law. Delays in introducing an energy bill could threaten its depth and support, says Jeremy Martin, an oil specialist at the Institute of the Americas in La Jolla, Calif.

“The longer things go, people start taking different directions, and then politicians, his team, start finding

reasons why they shouldn’t do something big,” Martin says. In the fall legislative session, an oil bill may also have to compete with the annual budget, a major distraction. Peña Nieto, who’s been president for seven months, says there’s political momentum to pass more reforms after the approval of new education and telecommunications laws that opened up both sectors to more competition. The education bill created an independent institute to evaluate schools and foster competition for jobs and promotions based on performance, a move that has sparked violent protests from teachers. The government also arrested the powerful head of the teachers’ union, Elba Esther Gordillo, on corruption charges, taking on a leader long considered to be untouchable. Her lawyers say she is innocent. In mid-June, Peña Nieto signed a law aimed at spurring more competition in telecommunications by threatening to break up companies that control a majority of the market. That’s a potential headache for billionaire Carlos Slim’s América Móvil (AMX), which has 70 percent of Mexico’s mobile phone subscribers, and Grupo Televisa (TV), which gets 70 percent of the nation’s broadcast television audience. “Overall he’s done an excellent job,” says James Jones, the U.S. ambassador to Mexico when the North American Free Trade Agreement took effect in 1994. “He has the best political sensitivity and touch I’ve seen since President Salinas was able to marshal various factions of Mexico to pass Nafta.”

Pemex reform key to Mexico’s oil industryMander, 13 (Benedict, June 27, correspondent at the Financial Times, Financial Times, “Energy: Focus on Pemex raises hopes of private investors,” http://www.ft.com/intl/cms/s/0/6aeb8e5a-c79c-11e2-9c52-00144feab7de.html#axzz2XorO05kg)//YS, accessed 7/01/13

Although some Mexicans celebrated the anniversary of the 1938 nationalisation of their oil and gas this year, there are high hopes that the industry is on the brink of important constitutional reform. If

successful, the reforms will enable an influx of private investment in long-needed projects. This could transform the industry and boost

the country’s economic competitiveness after decades of meagre investment

contributed to the gradual decline of Pemex, the state oil monopoly that was once a source of national

pride. “Pemex’s infrastructure is stretched to the limit,” says Marcelo Mereles,

a partner at Mexico City-based energy consultancy, EnergeA. “There is desperate need for

investment ,” he says, explaining that Pemex has become increasingly inefficient, with debilitating losses and steep production declines. With the election of Enrique Peña Nieto as president, winds of change have begun to blow. The construction of a $2.4bn gas pipeline that will connect Mexico with the US is under way, representing the country’s biggest energy infrastructure investment in 40 years. The Ramones project plan is for it eventually to meet one-fifth of Mexico’s demand for natural gas. With the threat of gas shortages looming, Mexico’s electricity commission announced in May that it was importing 18 cargoes of liquefied natural gas from Trafigura, the international trading company, over the next two years at about four times the price of US pipeline imports. But the Ramones project will allow Mexico to tap cheap gas imports from Texas. This could help meet growing demand in Mexico’s industrial heartland in the northeast, especially the booming automotive and aerospace industries. “We can’t have people fighting over gas ... A big part of our development and growth depends on it,” Alejandro Martinez, the director of Pemex’s gas subsidiary, said shortly after announcing the start of the bidding process for the construction of the second phase of the pipeline. The Ramones project, which will stretch 750 miles, has already attracted interest from at least five groups, including companies from the US, China, Russia, India, Brazil, Spain and Italy, according to Mr Martinez. In addition to funds going to Ramones, he said more than $3.5bn in private investment in pipelines was needed. “We are more than convinced that integration with the US gas system must be much greater,” said Mr Martinez. Pemex transports about half of its refined products by road with private trucks. This is about 12 times more costly than transport by pipeline and also more dangerous, comments Mr Mereles, a former adviser at Pemex. Storage infrastructure is in dire need of expansion, he adds, as Pemex has the capacity to store only two days’ worth of stocks of gasoline and diesel, which can fall to as little as a few hours’ worth at peak times. Considerable scope exists for investment in Mexican petrochemicals. That said, experts suggest that the country’s refining capacity is unlikely to expand in the near future since there is ample to spare in the US. Perhaps the greatest opportunities are in exploration and production. There is huge promise in the deep waters of the Gulf of

Mexico, where more than 40 per cent of Mexico’s “possible” oil and gas reserves lie. Also, the

country’s reserves of shale gas are the fourth largest in the world. There is little to no existing infrastructure in either area. The development of these reserves is becoming increasingly urgent since Mexico’s oil production has fallen from 3.4m barrels a day in 2004 to about 2.5m b/d, in

large part because of over-dependence on its massive Cantarell oilfield, which is running dry. But the ability of foreign oil companies to help reverse

this trend will depend on the success of constitutional reform. Mr Peña

Nieto has made this a priority, since foreign companies have been prohibited from getting Mexican oil out of the ground since the 1938 nationalisation. While many see this as Mexico’s best chance for energy reform in the past 75 years, it is far from being a done deal. A reform package is expected to be submitted to Congress by September. It remains unclear what it will contain. “We don’t know if it’s going to change enough for it to be attractive to invest,” says an executive at an international oil company.

Pemex’s capital investment in the past decade has quadrupled to almost $25bn, with most

of it destined for exploration and production. That may be a huge amount for one company, but it is not nearly enough for the development of the oil sector of a country the size of Mexico, comment analysts. Just to start producing in deep waters would require investments of $10bn a year, according to Mr Mereles. “It’s just not possible for Pemex to do this alone. We are going to need hundreds of companies coming in,” says one industry insider.

Ext – Pacto por Mexico

Pacto por Mexico can be strengthened through common ground on border infrastructureO’Neil, 13, (Shannon K, February 10, Senior Fellow for Latin American Studies at the Council on Foreign Relations, Council on Foreign Relations, “Mexico’s Congressional Agenda for 2013,” http://blogs.cfr.org/oneil/2013/02/05/mexicos-congressional-agenda-for-2013/)//YS, accessed 7/01/13

With Enrique Peña Nieto’s first congressional session just starting, expectations are high. Between now and April 30th,

when the sixty-second Congress will adjourn, many hope the administration will tackle the deep seated structural issues that hold the nation back. Mexico’s Congress has much going for it, as momentum for reform—lacking for years—is there. This new Congress began its tenure last September (working with President Felipe Calderón), and during its first go round, it passed a labor reform that enables greater flexibility in hiring and firing

workers and an education reform that changes the way teachers will be hired, evaluated, and promoted. Though some deemed the reforms as watered-down, these significant pieces of legislation represent a break from the gridlock of the past. Another advantage lies in the congressional leadership. The heads of the PRI delegations—the largest in both houses—are adept political operators. Senator Emilio Gamboa Patrón brings over thirty years experience working in a multitude of government positions to the table. Even stronger is Manlio Fabio Beltrones in the lower house, recognized by supporters and critics alike as one of Mexico’s most gifted politicians. Their developing agenda complements much of the PAN’s,

where they may find willing partners. Finally, Mexico’s three main political parties have already identified the substantial common ground on what needs to be done. The   Pacto por Mexico   is comprised on five central areas (constructing a law-based society, promoting economic growth, employment and competitiveness, improving security and justice, enhancing transparency, and furthering democratic governance) and includes ninety-five proposals that address everything from breaking up monopolies to investing more

in science and technology. Though moving from principles to details is always difficult, this underlying consensus provides a starting point missing in the past.

Ext – I/L Infrastructure solves

Nieto gains popularity from infrastructure investmentsPaternostro, 11 (Silvana, October, The Atlantic Monthly, “Beauty and the Beast” http://search.proquest.com.proxy.lib.umich.edu/docview/898363933/13F010F7A141726A721/2?accountid=14667)//YS, accessed 7/01/13

IF THE POLLS ARE correct, I am flying in a helicopter with the next president of Mexico. Enrique Peña Nieto, the governor of the State of Mexico since 2005, is on his way to inaugurate a new piece of road. As we"thwap-thwap our way over dry cornfields split by a highway that stretches to the horizon, Peña Nieto

puts a stick of gum in his mouth and slathers sunscreen on his face. "My [Nieto’s] priority is in creating infrastructure for investments to come in," he says. In two days, he is

scheduled to cut the ribbon of an overpass. "The voters needs to understand that I am looking after them." That must be why et góber ("the guv"), as Peña Nieto is known, has spent the past year inaugurating multiple public works each week. Members of the Partido Revolucionario Institucional, which ruled Mexico for more than 70 years until 2000, are gathering this fall to decide rules for nominating the party's presidential candidate. Campaigning won't begin until April, and the election itself won't be held until next July. But Peña Nieto's momentum like the return of the PRI to power already seems

unstoppable. July polls showed him with a 30-point lead over his nearest expected rival; he was riding the wave of a massive PRI victory in recent state elections that swept his chosen successor into office, with the handover occurring on September 16. For a party with a storied history of corruption, malfeasance, and vote-rigging, Peña Nieto's personal popularity offers easily the best chance in a decade to recover the presidency. Peña Nieto's presidential appeal has partly to do with voters' anger at the failure of President Felipe Calderóne administration to curb the savagery of the drug wars, and their feeling that they would be safer under the PRI, which has been widely thought to have cut deals with traffickers rather than fight them. But Peña Nieto has also enjoyed enormous clout from his control of the State of Mexico, or Edomex, whose gross domestic product is $77 billion and whose population of 15 million (with an estimated 10 million voters) outnumbers that of any other Mexican state. "Edomex," says Jorge Castañeda, Mexico's former foreign minister, "is the whole enchilada." And the PRI is no stranger to making sure that everybody gets a bite. As part of his gubernatorial campaign,

Peña Nieto traveled through the state's 125 municipalities asking residents what public works they needed. Before leaving, he would take out his pen, sign their wish lis,t, and pledge to deliver whatever he signed. Peña Nieto signed his name more than 600 times and called the promises compromisos, or "commitments." The segment of highway we're flying over is Compromiso No. 496.

Mexico wants improved border infrastructurePuig, 13 (Carlos, June 5, columnist for Mexican newspaper Milenio, New York Times, “Toeing the Line,” http://latitude.blogs.nytimes.com/2013/06/05/toeing-the-line/)//YS, accessed 7/01/13 TIJUANA, Baja California — On most radio stations in this city you get a traffic report every 15 minutes. It’s not the typical kind. It doesn’t refer to what’s going on in the streets; it’s all about “la Línea,” the Line. Here, an average of 50,000 cars and 25,000 pedestrians move between the United States and Mexico every day. The wait is described not in minutes or hours but in cars or pedestrians. The line is not a line; it’s four different lines. And so the reports go something like this: “San Ysidro, doors: 16.” (Referring to one of the two border crossings between Tijuana and San Diego, and the number of gates open there.) “Left: 220.” (Meaning, there are 220 cars lined up in the lanes to the left.) “Sentri: 70.” (That’s the count for pre-screened frequent crossers.) “Pedestrians: 1,600.” (According to the 9 a.m. report from June 3). You have to live on the border to know that 220 cars means waiting about two hours and 1,600 pedestrians about 90 minutes. Another way of putting this is to say that the busiest border in the world has become one of the more inefficient. A 2010 study by the San Diego Association of Governments and the California Department of Transportation

estimated that the delays cost the state of California around $4 billion and more than 25,000 jobs a year. In 2011, the U.S. and Mexican governments agreed to revamp border infrastructure in the Tijuana/San Diego area to reduce waiting times

to a maximum of 30 minutes. In October last year Mexico opened its new border station with 22 inspection lanes, an additional 16 from before. On the U.S. side, the plan was to roughly triple the number of car lanes and double the number of inspection posts for pedestrians. But

the project has fallen prey to the economic crisis and the U.S. budget sequester, and Customs and Border Protection — a subset of the Department of Homeland Security — has delayed any construction. Although President Barack Obama included in his budget proposal for FY 2014 some $226 million dollars for the border crossings, the allocation is still under discussion in Congress. It may be the first time that the poor southern country beats its rich northern neighbor. Small consolation, though, especially for the struggling Mexican economy. “Americans are not coming as they used to, and a big part is the delay at the border when they want to go back,” Carlos

Bustamante, the mayor of Tijuana, told me last week. Mexico has tried to alleviate losses by issuing a “fast pass” to tourists who spend $70 in designated local hotels and restaurants: It’s a one-day pass authorizing them to go through a makeshift lane monitored by the Tijuana police that let’s them skip the line to just before the U.S. inspection booth. It’s empty much of the time.

Mexicans want a more open borderMiroff, 13 (Nick, June 27, Washington Post correspondent covering Mexico, Central America and the Caribbean, Washington Post, “In Mexico, dismay for the border ‘surge’ proposed in U.S. Senate immigration bill,” http://articles.washingtonpost.com/2013-06-27/world/40226919_1_immigration-bill-busy-border-crossing-

border-surge)//YS, accessed 7/01/13

MEXICO CITY — When Sen. John McCain (R-Ariz.) said this week that the Senate immigration bill would transform the U.S.-Mexico boundary into “the most militarized border since the fall of the Berlin Wall,” it sounded to many here like a sensible statement of criticism. Then they realized he meant it as a selling

point. Mexicans have reacted sorely to proposals for a border security “surge” that would put 18,000 additional federal agents and hundreds of miles of new fencing between the two neighbors, measures that were included in a package of immigration legislation approved by the Senate on Thursday. Coming less than two months after President Obama heaped praise on Mexico’s progress and its importance as a top trading partner, the Senate bill debate and the security buildup offered by the amendment, known as Corker-Hoeven, has reminded Mexicans that much of the United States views their country warily. Mexico is the largest source of illegal drugs and unauthorized migrants entering the United States. But

Mexicans have bristled at a debate that has focused heavily on building new walls along the border, rather than wider doors for legitimate trade and migration to pass through. Of the estimated 11 million immigrants living unlawfully in the United States, at least 6 million are believed to be from Mexico. Mexican President Enrique Peña Nieto’s administration has kept noticeably quiet on the U.S. debate, saying only that his government supports the reform effort. However, the $46 billion in additional security measures offered by the amendment prompted Mexican officials to break their silence this week,

when Foreign Minister Jose Antonio Meade told reporters here that “fences don't unite.” “Fences are not a solution to the migration phenomenon, and they are not congruent with a safe and modern border,” Meade said. “They don’t contribute to the development of a competitive region that both countries are trying to build.”

***Border Security***

1ac

Plan results in efficient and terrorist proof border crossingWCMI, 05 – Major think tank focusing on relations between the US and Mexico (Wilson Center Mexico Institute, “THE UNITED STATES AND MEXICO: Towards a Strategic Partnership,” Wilson Center Mexico Institute, January 2009, http://www.wilsoncenter.org/sites/default/files/The%20U.S.%20and%20Mexico.%20Towards%20a%20Strategic%20Partnership.pdf)//AR

“The most significant (challenge facing enhanced cross-border innovation between the Californias) is assuring a secure and e ffi cient border that enables frequent and rapid border crossings.”39 At the same time scant evidence exists to prove that increased vigilance of all tra ffi c crossing the border, which is the source of the long wait times , has actually led to improved security. An emphasis on “smarter” security for border crossing, which would target potential threats and move some commercial inspections farther from the border itself, could both enhance security and encourage efficiency in border crossings. Policy options to reverse this trend include:including major spending for border infrastructure investment programs in the stimulus plans proposed by the governments of the United States and Mexico. Spending could focus on improvements in cross-border transportation facilities, ports, rail linkages, bridges, and the roads that connect these to larger cities, with the end aim of improving cross-border commerce and the lives of borderregion residents. If a National Infrastructure Reinvestment Bank is developed by the Obama administration, this might include provisions for border infrastructure, which generally requires binational financing.Increasing the number of Customs and Border inspectors as a short-term measure to reduce border crossing times. Expand the hours of operation of border crossing stations as needed, and use two to three inspectors per line at peak hours. Consider double- or triple-stacking inspection booths, as needed, to shorten crossborder wait times. Funds from construction of the border fence could be redirected into paying for the costs of an increased number of border inspectors, which would enhance both security and commerce

Squo Border measures are insufficient - terrorist organizations can enter Murdock 13 (Deroy Murdock, an American syndicated columnist with the Scripps Howard News Service, a contributing editor with National Review Online. A native of Los Angeles, California, Murdock lives in New York City. "U.S.-Mexican border welcomes terrorists" May 1, 2013 http://www.unionleader.com/article/20130502/OPINION02/130509896, RLA)

There are at least 7,518 reasons to get the U.S.-Mexican border under control. That equals the number of aliens apprehended in fiscal year 2011 from the four nations that federal officials label "state sponsors of terrorism" plus 10 "countries of interest." Since January 2010, those flying into the United States via these 14 nations face enhanced screening. As the Transportation Security Administration announced at

the time: "Effective aviation security must begin beyond our borders." U.S. national security merits at least that much vigilance on our borders.¶ The roaring immigration-reform debate largely addresses Hispanic aliens who illegally

cross the border. Far more worrisome, however, are the thousands who break into the United States from countries "where we have concerns, particularly about al-Qaida affiliates," a top State Department official told CNN.¶

These include Cubans, Iranians, Sudanese and Syrians, whose governments are federally designated "state sponsors of terrorism." As Customs and Border Protection's "2011 Yearbook of Immigration Statistics" reports, 198 Sudanese were nabbed while penetrating the USA. Between fiscal years 2002 and 2011, such arrests totaled 1,207. (These figures cover all U.S. borders, although 96.3 percent of detainees crossed from Mexico.) Like other immigrants, most Sudanese seek better lives here. But some may be vectors for the same militant Islam that tore Sudan in two - literally.

Al Qaeda seeks to exploit undeveloped borders and unleash bioweaponsThe Washington Times, 09(The Washington Times, “Al Qaeda eyes bio attack from Mexico” June 3, 2009 http://www.washingtontimes.com/news/2009/jun/3/al-qaeda-eyes-bio-attack-via-mexico-border/?page=all, RLA)

U.S. counterterrorism officials have authenticated a video by an al Qaeda recruiter threatening to smuggle a biological weapon into the United States via tunnels under the Mexico border, the latest sign of the terrorist group’s determination to stage another mass-casualty attack on the U.S. homeland.¶ The video

aired earlier this year as a recruitment tool makes clear that al Qaeda is looking to

exploit weaknesses in U.S. border security and also is willing to ally itself with

white militia groups or other anti-government entities interested in carrying out an attack inside the United States, according to counterterrorism officials interviewed by The Washington Times.¶ The officials, who spoke only on the condition they not be named because of the sensitive nature of their work, stressed that there is no credible information that al Qaeda has acquired the capabilities to carry out a mass biological attack although its members have clearly sought the expertise.¶ The video first aired by the Arabic news network Al Jazeera in February and later posted to several Web sites shows

Kuwaiti dissident Abdullah al-Nafisi telling a room full of supporters in Bahrain that al Qaeda is casing the U.S. border with Mexico to assess how to send terrorists and weapons into the U.S.¶ “It shouldn’t be a surprise to anyone that terrorist organizations would utilize the border to enter the U.S.,” said a DEA official who also asked not to be named because of his involvement in ongoing

intelligence operations. “We can’t ignore any threat or detail when it comes to al Qaeda and other terrorist organizations bent on attacking the U.S.”¶ “The Americans are afraid that the [weapons of mass destruction] might fall into the hands of ‘terrorist’ organizations like al Qaeda and others,” he told followers. “There is good reason for the

Americans’ fears. … [Al Qaeda] had laboratories in north Afghanistan. They have scientists, chemists and nuclear physicists. They are nothing like they are portrayed by these mercenary journalists - backward Bedouins living in caves. No, no, by no means. This kind of talk can fool only naive people. People who follow such things know that al Qaeda has laboratories, just like Hezbollah.

Bioterror attacks would target the USBryan ‘1 (Anthony T. Bryan, director of the North-South Center’s Caribbean Program, 10-21-2001. CFR, Terrorism, Porous Borders, and Homeland Security: The Case for U.S.-Caribbean Cooperation, p.http://www.cfr.org/publication/4844/terrorism_porous_borders_and%20_homeland_%20security.html)

Terrorist acts can take place anywhere. The Caribbean is no exception. Already the linkages between drug trafficking and terrorism are clear in countries like

Colombia and Peru, and such connections have similar potential in the Caribbean. The security of major industrial complexes in some Caribbean countries is vital. Petroleum refineries and major industrial estates in Trinidad, which host more than 100 companies that

produce the majority of the world’s methanol, ammonium sulphate, and 40 percent of U.S. imports of liquefied natural gas (LNG), are vulnerable targets.

Unfortunately, as experience has shown in Africa, the Middle East, and Latin America, terrorists are likely to strike at U.S. and European interests in Caribbean countries. Security issues become even more critical when one considers the possible use of Caribbean countries by terrorists as

bases from which to attack the United States . An airliner hijacked after

departure from an airport in the northern Caribbean or the Bahamas can be flying over South Florida in less than an hour. Terrorists can sabotage or seize control of a cruise ship after the vessel leaves a Caribbean port. Moreover, terrorists with false passports and visas issued in the Caribbean may be able to move easily through passport controls in Canada or the United States. (To help counter this possibility, some countries have suspended "economic citizenship" programs to ensure that known

terrorists have not been inadvertently granted such citizenship.) Again, Caribbean countries are as vulnerable as anywhere else to the clandestine manufacture and deployment of bio logical weapons within national borders.

ExtinctionSTEINBRUNER ’97 - Brookings senior fellow and chair in international security, vice chair of the committee on international security and arms control of the National Academy of Sciences (John D. Steinbruner, Winter 1997, Foreign Policy, “Biological weapons: a plague upon all houses,” n109 p85(12), infotrac)

Although human pathogens are often lumped with nuclear explosives and lethal chemicals as potential weapons of mass destruction, there is an obvious, fundamentally important difference: Pathogens are

alive, weapons are not. Nuclear and chemical weapons do not reproduce themselves

and do not independently engage in adaptive behavior; pathogens do both of

these things. That deceptively simple observation has immense implications. The use of a manufactured weapon is a singular event. Most of the damage occurs immediately. The

aftereffects, whatever they may be, decay rapidly over time and distance in a

reasonably predictable manner. Even before a nuclear warhead is detonated, for instance, it is possible to estimate the extent of the subsequent damage and the likely level of radioactive fallout. Such

predictability is an essential component for tactical military planning. The use of a pathogen, by

contrast, is an extended process whose scope and timing cannot be precisely controlled. For most potential biological agents, the predominant drawback is that they would not act swiftly or

decisively enough to be an effective weapon. But for a few pathogens - ones most likely to have a decisive effect and therefore the ones most likely to be contemplated for deliberately hostile use - the risk runs in the other direction. A

lethal pathogen that could efficiently spread from one victim to another would be capable of initiating an intensifying cascade of disease that might ultimately threaten the entire world population. The 1918

influenza epidemic demonstrated the potential for a global contagion of this sort but not necessarily its outer limit.

Ext – Venezuelan Terrorist

Venezuelan terrorists will enter the country Schilling 10(Chelsea Schilling, commentary editor and staff writer for WND, an editor of Jerome Corsi's Red Alert ,U.S. Army veteran "FOREIGN 'TERRORISTS' BREACH U.S. BORDER" May 20, 2010 http://www.wnd.com/2010/05/156441/, RLA)

Warning of an “ever-present threat of terrorist infiltration over the Southwest border,” the congressional report notes:¶ U.S. Immigration and Customs Enforcement investigations have revealed that aliens were smuggled from the Middle East to staging areas in Central and South America, before being smuggled illegally into the United States.¶ Members of

Hezbollah have already entered the United States across the Southwest border.¶ U.S. military and intelligence officials believe that Venezuela is emerging as a potential hub of terrorism in the Western Hemisphere. The Venezuelan government is issuing identity documents that could subsequently be used to obtain a U.S. visa and enter the country.¶ The Texas border – specifically the McAllen area – outpaces the rest of the nation in OTMs and aliens from “special-interest countries.”¶ From Sept. 11, 2001, to 2006, the Department of Homeland Security reported a 41 percent increase in arrests along the Texas/Mexico border of “special-interest aliens” – including aliens from Iran, Jordan, Lebanon, Syria, Egypt, Saudi Arabia, Kuwait, Pakistan, Cuba, Brazil, Ecuador, China, Russia, Yemen, Albania, Yugoslavia and Afghanistan – all apprehended in the South

Texas region alone.¶ U.S. immigration authorities have discovered items along the banks of the Rio Grande River that suggest ties to terrorist organizations. In 2006, Sheriff Sigifredo Gonzalez of Zapata County, Texas, reported that officials found Iranian currency in the same area.

Ext – Islamic Groups

Security is crucial - Islamic radical groups will hone their capabilities in Mexico Schilling 10(Chelsea Schilling, commentary editor and staff writer for WND, an editor of Jerome Corsi's Red Alert ,U.S. Army veteran "FOREIGN 'TERRORISTS' BREACH U.S. BORDER" May 20, 2010 http://www.wnd.com/2010/05/156441/, RLA)

“Islamic radical groups that support Hamas, Hezbollah and Islamiya Al Gamat are all active in Latin America,” the 2006 congressional report states.

“These groups generate funds through money laundering, drug trafficking and arms deals, making millions of dollars every year via their multiple illicit activities. These cells reach back to the Middle East and extend to this hemisphere the sophisticates global support structure of international terrorism.”¶ In May 2001, just months before the Sept. 11

terrorist attacks, a former Mexican national security adviser and U.N. ambassador, Adolfo Aguilar Zinser, warned, “Spanish and Islamic terrorist groups are using Mexico as a refuge.”¶ The 39-page report notes members of Hezbollah, the Lebanon-based terrorist organization, have already entered the U.S. by way of the Southwest border.¶ In 2002, authorities arrested Salim Boughader Mucharrafille, a café owner in Tijuana, Mexico, for smuggling more than 200 Lebanese people into the U.S., including several believed to have ties to Hezbollah.¶ Also, in March 2005, Mahmoud Youssef Kourani, an illegal alien who had been smuggled across the U.S.-Mexico border after bribing a Mexican consular official in Beirut for a visa, pleaded guilty to providing material support to Hezbollah. Kourani, brother of the Hezbollah chief of military operations in southern Lebanon, lived in Dearborn, Mich., while he solicited funds for Hezbollah terrorists.¶ Hezbollah relies on “the same criminal weapons smugglers, document traffickers and transportation experts as the drug cartels,” Michael Braun, retired assistant administrator and chief of

operations at the U.S. Drug Enforcement Administration, told the Washington Times last year. “They work together. They rely on the same shadow facilitators. One way or another, they are all connected. ”¶ He added, “They’ll leverage those relationships to their benefit, to smuggle contraband and humans into the U.S.; in fact, they already are [smuggling].”¶ In 2006, Colombia’s acting attorney general, Jorge Armando Otalora, announced authorities had dismantled a ring that had been producing fake passports to help illegal aliens enter the United States. Colombian officials said the gang was tied to al-Qaida and Hamas militants and that it had supplied the false passports to citizens from Pakistan, Jordan, Iraq, Egypt and other countries. However, the U.S. Justice Department denied those allegations, saying the gang had connections to the Revolutionary Armed Forces of Colombia, or FARC. Justice Department spokesman Bryan Sierra said, “We are not alleging any connections to any terror organization other than

the FARC.”¶ As WND reported in 2007, President Bush’s top intelligence aide confirmed that Iraqi terrorists were captured coming into the United States from Mexico.¶ Just this week, Houston’s KHOU-TV 11 reported Homeland Security warned Houston, Texas, police and Harris County Sheriff’s deputies that a suspected terrorist may be traveling through the U.S. through Mexico. Mohamed Ali is a suspected member of the terrorist group Al Shabaab, a group based in Somalia with ties to the Somali attacks portrayed in the movie “Blackhawk Down.”¶ Only months ago, Al Shabaab announced its allegiance to al-Qaida and Osama bin Laden.

Jihadists are able to remain hidden in Mexico where they continue to growWND News 05(WND News, “MEXICO'S BLIND EYE¶ TO AL-QAIDA ACTIVITY” June 13, 2005 http://www.wnd.com/2005/06/30759/, RLA)

Al-Qaida “communities,” like the one busted in Lodi, Calif., have direct ties to other networks in Mexico and Central America, where jihadi terrorists are

not viewed as a local threat, reports Joseph Farah’s G2 Bulletin.¶ “South of the Rio Grande Valley there exists a dire situation,” said an intelligence researcher who took part in an academic meeting in west Canada.¶ Intelligence sources and researchers agree there is hardly any effective cooperation between the Department of Homeland Security and the intelligence establishment of

Mexico’s President Vicente Fox.¶ Mexican agencies charged with intelligence and counter-terrorism, such as the Office of Coordination of the Presidency and the Center

for Research on National Security, CISEN, do little more than offer half-hearted monitoring of militant Islamic activity, say G2 Bulletin sources.¶ Mexico is facing a national crisis in dealing with drug lords who are killing elected officials, police chiefs and

innocent civilians. Officials there have little interest and fewer resources to devote to law enforcement and intelligence activities that threaten the U.S., not Mexico.¶ As WND reported last week, Islam is on the move in Mexico and throughout Latin America, making dramatic gains in converting the native population, increasing immigration, establishing businesses and charities and attracting attention from U.S. government officials who have asked their neighbors to the south to keep an eye on foreign Muslim groups.¶ While Mexico has pledged to monitor these activities on behalf of the U.S., those familiar with the recruitment practices and the Mexican government’s oversight say the U.S. has reasons for concern.¶ For instance, Gen. Jorge Serrano, the head of the Attorney General Office’s special terrorism investigation unit, says no Muslim terrorists have been found living in Mexico.¶ Yet intelligence sources in the U.S. and Canada say Islamic jihadists have been working with zealots in Mexico for more than 20 years. Early activities were sponsored by Iran. Later, the recruitment activities got support from the Egyptian, Pakistani and Saudi embassies. It is known the Egyptians paid the rent for a prayer hall and

allocated funds for students who wanted to study at the Islamic al-Azhar University in Cairo. The Pakistanis organized Muslim converts and others to visit madrassas in Pakistan, a golden opportunity offered to the Taliban and al-Qaida to reach a larger pool of recruitment candidates. Saudi funds created a range of activities linked to Hajj or studies in Saudi Arabia where young zealots established contacts with Sufi and Wahabi activists one way or another connected to master terrorist Osama bin Laden.¶ Mexican authorities revealed in 2002 they knew Spanish Muslim converts of Basque origin were present in Chiapas state preaching the ideas of Islam and jihad as they mingled with local aboriginals. At least in two cases Mexican authorities, unable to determine the whereabouts of Basque Muslims, sent letters to their last known address informing them their stay in the country was illegal. According to a CISEN official, most Basque and Spanish Muslims were linked to the North African-based al-Murabitun World Tzotzil Movement, known for its blend of socialism and Islam. Information on Basque activity in Mexico is regularly collected by the Spanish government, but is not shared with the U.S. by the Mexicans.¶ Small, sometimes clandestine Islamic clubs in Mexico, usually disguised as cultural groupings, are on the

increase. Information on ways to cross the U.S. and Mexican border and where to go, including recommended U.S. states and so-called asylum cities has actually already reached all corners of the jihadi Khalifat world. Some documents found in Pakistan, and more information from Iraq and Lebanon, proves jihadists are aware they are in danger of being detected when they use legitimate ports of entry to the U.S. Therefore they prefer to reach their sympathizers in Mexico and then penetrate the U.S. together with hundreds of thousands of Mexicans, drug lords and gang members.¶ As one Royal Canadian Mounted Police officer familiar with the situation in Mexico said: “What’s the point of having old ladies remove their shoes at airport security checks, when all it takes to carry a small package of the potent ricin poison into the U.S. is a friendly Mexican jihadist escorting you on a dark moonless night across the

porous U.S.-Mexican border.”

Ext – Drug War Escalation

Drug wars along the decrepit border escalate Farah 08(Douglas Farah, writer for Counterterrorism Blog, The first multi-expert blog dedicated solely to counterterrorism issues, serving as a gateway to the community for policymakers and serious researchers, designed to provide realtime information about terrorism cases and policy developments. "Mexico: Growing Terror and Close to Collapse" December 8, 2008 http://counterterrorismblog.org/2008/12/mexico_growing_terror_and_clos.php, RLA)

One of the most amazing things to me in the recent electoral process was the complete absence of serious discussion by either camp of anything relating to Latin America.¶ While Venezuela, Nicaragua, Bolivia and Ecuador have formed a new anti-U.S. and pro-Iranian axis, perhaps the most dangerous developments are taking place directly on our southern border. It is to the point where the Mexican government, despite commendable efforts by the Calderon administration, is barely hanging on.¶ I say this with deep sadness. I lived through the similar Colombian experience where the narco-violence shattered the country, almost took over the state, and claimed the lives of many of my friends, including journalists I worked with. That is part of the reason I cannot understand the lack of attention to the

crisis.¶ We are looking at the creation of a series of mini narco-states along our border, and from our border heading south through Central America. Mexico's own southern border with Guatemala is now awash in cartel violence, and much of Guatemala is no longer under state control. El Salvador is a money laundering sanctuary, as is Panama, and Nicaragua, along with Venezuela, have become black holes where an increasing amount of cocaine transits.¶ This is

a clear and present danger not only to the United States, which will (and already has)

suffer from the spillover of violence and border security-but to the Mexican state as well.¶ The drug war there is taking an enormous toll. Even hospitals are no longer safe from the violence.¶ Senior police and government officials are assassinated with such frequency their deaths seldom make the news here at all. Some are killed because they are trying to do the right thing, some because they are on the losing side of an intra-cartel battle, but it is shredding the authority of the state.¶ Illegal immigration of non-Latin Americans, including

Iranians, Chinese and Turks, is on the rise. Why does this matter? Because the cartels in their many different iterations and factions, thrive on instability, and their ability to move anything (drugs, people, weapons) across our border. Iranians and Turks arriving this way are not here to see the Empire State Building or the Grand Canyon.

Ext - Zetas

Specifically, the Zetas have the potential to devastate the planetHesterman 09(Jennifer L. Hesterman, Counterterrorism Expert, Senior Analyst at The MASY Group, Academic author for CRC Press, & Contributing Editor for The Counter Terrorist Magazine, Master’s degrees from Johns Hopkins University and Air University, a National Defense Fellow at the Center for Strategic and International Studies, "The Mexican Drug War Spills Over United States Border" July 2009 http://www.thecounterterroristmag.com/pdf/Issue7.Hesterman.MexicanDrugWar.lores.pdf, RLA)

It’s also critical to note that Hezbollah, ¶ Hamas, and possibly al-Qaeda are already ¶ operating in South America. Therefore, ¶ policymakers and operators alike must ¶ ask the following question and confront ¶ the inevitable answer: Would the Zetas ¶ partner with these groups and provide a ¶ new, asymmetric

challenge to the U.S.? ¶ In the face of the escalating threats at ¶ the U.S. border, perhaps it is time to take ¶ a harder line to protect our security. One ¶ option is to officially

designate Los Zetas as a terrorist group. The Zetas meet the ¶ State Department’s

threshold as a foreign ¶ organization that threatens our national ¶

security, and they certainly pose more of ¶ a danger to our national security than ¶ several dormant

groups that reside on the list (November 17 and Aum Shinriyko/¶ Aleph, for example). The Zetas also have ¶ the weaponry to operate as irregular ¶ forces, with fire teams capable of carrying ¶ out autonomous operations with tactical ¶

flexibility. It is time to recognize that ¶ some transnational criminal groups aren’t ¶ just in the

money-making business—they ¶ also use terror as a tactic and act in a ¶

subversive manner toward governments ¶ and law enforcement institutions.

The Zetas are stockpiling weapons, drug related violence spills overHesterman 09(Jennifer L. Hesterman, Counterterrorism Expert, Senior Analyst at The MASY Group, Academic author for CRC Press, & Contributing Editor for The Counter Terrorist Magazine, Master’s degrees from Johns Hopkins University and Air University, a National Defense Fellow at the Center for Strategic and International Studies, "The Mexican Drug War Spills Over United States Border" July 2009 http://www.thecounterterroristmag.com/pdf/Issue7.Hesterman.MexicanDrugWar.lores.pdf, RLA)

Since 2005, the DEA has continually ¶ warned that drug-related violence will ¶ spill over the Mexican border into the ¶ United States. More recently,

an October ¶ 21, 2008, FBI intelligence report painted ¶ a particularly grim picture. It advised that ¶ the Zetas were reinforcing their ranks ¶ and stockpiling weapons in safe houses ¶ in the U.S. in response to crackdowns; ¶ moreover, the report predicted an ¶ escalation of violence on both sides of ¶ border in the months to come.16¶ Thus, the future is now a harsh reality. ¶

Although it appears that tactical-level ¶ needs are being addressed, larger national ¶ security questions will require additional ¶ action to turn the tide on the growing ¶ instability in the region and the entire ¶ hemisphere. For

instance, can national ¶ assets be used for domestic security when ¶ it is threatened by criminal terrorists ¶ such as the Zetas? Also, with $12 billion ¶ to $15 billion per year flowing from ¶ the United States to Mexican drug ¶ traffickers,17 how can we reduce demand ¶ or discourage use? ¶ Michael Sullivan, former

acting ¶ director of the ATF, recently stated that ¶ investigators have traced large numbers ¶ of the illegal weapons found in Mexico ¶ to the United States.18 The U.S. is ¶ addressing the issue with gun dealers in ¶ our country and at the border

through ¶ the ATF’s Project Gunrunner, but how ¶ can Mexico tighten its border security to ¶ 9450 NW 58st - Unit 105 • Doral, Florida 33178 • Phone: 305.471.4733 • Fax: 305.471.4831¶ Circle 335 on Reader Service Card¶ stop the southward flow of weapons into ¶ the hands of the cartels?

Left unstopped, the Zetas will control MexicoCardesh et al 11(Sharon L. Cardash, Frank J. Cilluffo and Bert B. Tussing, Joint Policy and Research Forum co-convened by the ¶ George Washington University Homeland Security ¶ Policy Institute and the Center for Strategic Leadership, ¶ U.S. Army War College, “THE HYBRID THREAT¶

Crime, Terrorism and Insurgency in Mexico” December 2011 http://www.csl.army.mil/usacsl/publications/HybridThreatMonographInternetVersion.pdf, RLA)

In-country, the Mexican drug cartels have become so powerful that they ¶ threaten, if not effectively supplant, the state in certain parts of the country. ¶ Using merciless intimidation, the narco-traffickers have managed to subdue ¶ these local populations and

secure their de facto allegiance. As one analyst ¶ describes, the Zetas, for instance, “seek to dominate the political life of a ¶ community, controlling the community’s ability to organize and interact with ¶ the state, determining the extent and functions of local government, and ¶ sometimes even

exercising quasi-control over the local territory.”5¶ Observers ¶ differ on how to characterize this situation. Some, including inside the U.S. ¶ Government (USG), have called it an insurgency or a narco-insurgency – ¶ although a few of these comments (including from USG sources) were later ¶ walked back.6¶ Mexican President Calderon himself has bluntly characterized ¶ the violent activities of the cartels as follows: “Their business is no longer just ¶ the traffic of drugs. Their business is

to dominate everyone else…This criminal behavior is what has changed and become a defiance to the state, an attempt ¶ to replace the state…”

Ext – Plan evaluates threats

The plan promotes risk assessment strategies – that eliminates all threatsRosenblum et al 13(Marc R. Rosenblum, Specialist in Immigration Policy Jerome P. Bjelopera, Specialist in Organized Crime and Terrorism Kristin M. Finklea, Specialist in Domestic Security, “Border Security: Understanding Threats at ¶ U.S. Borders” February 21, 2013 http://www.fas.org/sgp/crs/homesec/R42969.pdf, RLA)

Another long-standing DHS program relying on risk management is CBP’s Automated Targeting ¶ System (ATS), which is founded on rules-based cargo screening systems originally deployed by ¶ the legacy U.S. Customs Service. Under the system, electronic cargo and passenger manifests, ¶ vehicle crossing records, nonimmigrant entry records, and other information are checked against ¶ CBP’s National

Targeting Center (NTC) and other intelligence and law enforcement databases. ¶ Every traveler, vehicle, and cargo container is assigned a risk score based on a variety of threat ¶ scenarios to identify potential terrorist and criminal threats. Travelers with risk scores above a ¶ certain threshold are automatically targeted for secondary inspection at a port of entry.68¶ Pursuant to the Project BioShield Act of 2004 (P.L. 108-276) and a set of White House ¶

directives,69 DHS also has worked with the intelligence community, other federal agencies,

and ¶ academia to develop formal, quantitative models to assess the risks of possible terrorist attacks ¶ using chemical, biological, radiological, or nuclear

(CBRN) weapons. These models, known as ¶ the Bioterrorism Risk Assessment (BTRA), the Chemical Terrorism Risk Assessment (CTRA), ¶ the Radiological and Nuclear Terrorism Risk Assessment (RNTRA), and the Integrated Terrorism ¶ Risk Assessment (ITRA), use PRA “event trees”70 to estimate the likelihood and potential ¶

consequences of millions of different attack scenarios.71 The current versions of the four threat ¶ assessments were published in 2010-2011, and DHS plans to publish updates every four years, ¶ with the next BTRA, CTRA, and NRTRA due in 2014, and the next ITRA due in 2015.72¶ DHS also led the 2011 Strategic National Risk Assessment (SNRA), executed in support of a ¶ White House directive to develop an all-hazards national preparedness system.73 The SNRA drew ¶ on data from existing government assessments, historical records, and judgments from experts in ¶ a variety of disciplines to evaluate the risk of various national-level events, including certain ¶ natural disasters, technological/accidental hazards, and adversarial/human-caused attacks.74 The ¶ assessment was limited to “events that have a distinct beginning and end,” and therefore

Mexico is a major supplier of illegal drugs to the United StatesAndreas 98 (Peter Andreas, guest scholar at the Centerfor United States-Mexican Studies at the University ofCalifornia at San Diego, a Social Science Research Council-MacArthur Foundationfellow onPeaceand Security in aChangingWorld."The Political Economy of Narco-Corruption in Mexico" April 1998 http://www.brown.edu/Departments/Political_Science/people/documents/ThePoliticalEconomyofNarco-CorruptioninMexico.pdf, RLA)

The United States State Department estimates that as much as 70 percent of the South American cocaine bound for the United States market enters through Mexico; Mexico also supplies between 20 and 30percent of the heroin

consumed in the United States, and up to 80 percent of the imported marijuana. (Of course, any official drug statistics represent at best rough estimates.)In addition, Mexican traffickers now dominate much of the American market for methamphetamines. The United

States Drug Enforcement Administration (DEA)believes that Mexico earns more than $7 billion a year from the drug trade, while Mexico's prosecutor general's office calculates

that drug traffickers operating in Mexico accumulated revenues of about $30 billion in 1994.The drug business is a significant employer: there are roughly 200,000people earning a living growing drug crops (the Mexican attorney general's office calculates that the figure maybe as high as 300,000).This number does not include the thousands of other jobs directly or indirectly generated by the drug trade in are as such as transportation, security, banking, and communications. This underground exit option has been especially important during a time of falling wages and limite demployment prospects in the formal economy

Terrorists are targeting vunerable energy sources – only investment solves CSIS, 04 - Bipartisan domestic and foreign policy think tank, conducting policy studies and strategic analyses on political, economic and security issues (Center for Strategic and International Studies, “U.S.-Mexico Border Security and the Evolving Security Relationship,” U.S.-Mexico Binational Council, 4/15/04, http://csis.org/files/media/csis/pubs/0404_bordersecurity.pdf)//AR

Critical infrastructure in Mexico—both in the northern border region and elsewhere in the country—could be targeted by terrorists attempting indirectly to do harm to the United States. Mexican infrastructure critical to U.S. interests includes a diversity of strategic sites, ranging from oil and natural gas production facilities and pipelines, water supplies, power generating stations and grids, and other facilities that, if destroyed or incapacitated for any length of time, would have significant adverse effects on both the United States and Mexico. Perhaps the single most essential Mexican installation for the U.S. economy is the Cantarel oil field in the Gulf of Mexico. Over 50 percent of Mexico’s oil production comes from this one field, and all of it passes through the small port of Dos Bocas. Both could be targeted by terrorists intending to disrupt the U.S. and international economies. Furthermore, in 2000, Mexico exported approximately 1.4 million barrels per day of petroleum to the United States, representing 76 percent of Mexican crude exports and almost 15 percent of U.S. imports. PEMEX, Mexico’s national oil conglomerate, maintains eight natural gas connection points with the United States. They have the capacity to transport about 1 billion cubic feet of gas daily. In addition, there are 13 electrical interconnections between Mexico and the United States. All of these could be vulnerable to terrorist attacks.The dependence of large populations in both countries on the same water supplies and infrastructure could be tempting to terrorists who could opt to cause panic on both sides of the border by attacking in Mexico. Population projections used by the Rio Grande Water Planning Group estimate that the population of the eight Texas border counties between Laredo and the mouth of the river will more than double by 2050.

Before September 11, the potential for an attack against critical infrastructure targets, such as energy pipelines, water supplies, nuclear reactors or nuclear storage facilities, was not thought to be high. The U.S. Nuclear Regulatory Commission (NRC) suggested that large-scale terrorist acts on those installations did not fall within the realm of “reasonably foreseeable events.” But, then, hijacked planes being flown into skyscrapers was not a reasonably foreseeable event either. In response to the threat of another major attack on the U.S. homeland, DHS is in the process of creating a database of all existing critical infrastructure in the United States that could become terrorist targets. Once completed, probably by late 2004, the list will be prioritized so that the department will be able to develop tools, processes, and methodologies for identifying potential terrorist threats against fixed installations of strategic importance. Such a database of critical Mexican infrastructure could be an essential tool in the Fox administration’s planning as well.

Efficient border security solves economic detriments and prevents future terror attacksCSIS, 04 - Bipartisan domestic and foreign policy think tank, conducting policy studies and strategic analyses on political, economic and security issues (Center for Strategic and International Studies, “U.S.-Mexico Border Security and the Evolving Security Relationship,” U.S.-Mexico Binational Council, 4/15/04, http://csis.org/files/media/csis/pubs/0404_bordersecurity.pdf)//AR

Within the region, another set of challenges has emerged in the new millennium. The United States, and consequently Mexico, experienced two recessions that slowed trade and investment while threatening to

fuel a return to protectionism. Differences in regional regulatory frameworks, complicated rules of origin, and transportation inefficiencies all erode the natural comparative advantages of the North American region. Key to solving these and other challenges is an understanding on the part of policymakers, industry, and labor that the U.S. relationship with Mexico is not being fully leveraged to maximize North American competitiveness vis-à-vis other economic regions such as Europe or East and Southeast Asia.21¶ Many argue the border has become more difficult and costly to cross as a result of inadequate infrastructure investment and the increased security measures put in place after September 11, 2001. Extended and unpredictable

wait times at the border create a disincentive to bilateral trade and production sharing, disrupting production chains and disproportionately hurting small and medium sized businesses. Nearly 80% of trade with Mexico is land trade, meaning it enters or exits the U.S.

through one of the ports of entry along the Southwest border.22 The enhanced use of techniques, such as pre-inspection clearance, that facilitate the secure flow of goods across the border can help lower the costs of trade and encourage production sharing.23 ¶ Recognizing the need to prioritize both security and the economy, the U.S. and Mexican governments developed the 21st Century Border Initiative to expedite secure, legal traffic by trusted parties and thereby free up capacity for border security personnel to investigate potentially dangerous goods and individuals. Strong cooperation at the

border allowed the United States and Mexico to open three new border crossings in 2010, two in Texas

and one in Arizona.¶ There is no doubt that the economies of the United States and Mexico are facing serious challenges. While much of the risk is due to external

pressures, whether the rise of Asian competition or fears of crisis in Europe, much of the solution lies in strengthening regional competitiveness. Efforts to improve border management, harmonize regional regulation, and simplify rules of origin are a good starting point, but improving policy requires surmounting certain political challenges. The path forward, then, must be based in a clear understanding that enhanced cooperation with Mexico strengthens the

economy of the United States. The solution begins with a vision of the United States and Mexico as partners rather than competitors.

***NADBank Advantage***

1ac

NADBank can’t do TI nowHendricks, 09 (David, “Legislation aims to broaden NADBank activities,” My San Antonio, 7/21/09, http://blog.mysanantonio.com/clockingin/2009/07/legislation-aims-to-broaden-nadbank-activities/)

The BECC and NADBank have been restricted largely to water development, water treatment, sewage, landfill, road-paving and a few energy-related projects since the institutions were founded in 1994. The legislation would expand the list to economic development, telecommunications, transportation and other areas. “The needs of the area have changed dramatically over the years,” Hinojosa said. NADBank and BECC directors are holding a board meeting and their annual public meeting in San Antonio today at the Mexican Consulate.

Expanding NADBank’s mandate is key to creating a sustainable capital base – absent that it can’t promote sustainability in the regionKaplan and Hammacher, 00 – Gordan, attorney with the firm of Hillyer &. Irwin in San Diego and Linda K., attorney (“A Bigger Role for NAFTA's Development Bank?,” San Diego Business Journal, 11/13/00, http://ehis.ebscohost.com/ehost/detail?sid=74ef2ace-3feb-4b1f-80f5-660cbb179c88%40sessionmgr113&vid=1&hid=114&bdata=JnNpdGU9ZWhvc3QtbGl2ZQ%3d%3d#db=f5h&AN=3826486&anchor=toc)

Narrowly Focused Mandate NADBank's mandate is, however, narrowly drawn in terms of geographic scope as well as in terms of the types of projects the bank can undertake. The bank is limited by its charter to providing financing and other forms of assistance for projects in the area within 100 kilometers (about 62 miles) north

and south of the U.S.-Mexican border. The charter further limits the bank's undertakings within

this geographic area to "environmental infrastructure projects," which are defined as those "that will prevent, control or reduce environmental pollutants or contaminants, improve the drinking water supply, or protect flora an.d fauna so as to improve human health, promote sustainable development, or contribute to a higher quality of

life." However, another charter provision directs that "preference" must be given to projects relating to water pollution, wastewater treatment, and municipal solid waste management. As a result of this charter directive, the bank's undertakings are confined as a practical matter to such "preferred" projects only. As of June, NADBank had authorized $265.4 million in loans and grants for 29 such

projects on both sides of the border. These 29 projects, when completed, will involve a total cost and investment from private and public sources of $831.3 million. San Diego has received $17.2 million for the South Bay Water Reclamation Plant (total cost $99.6 million), while Tijuana has received $18.5 million for a sewage and wastewater treatment project to eliminate raw sewage flowing into the Tijuana River (total cost $19.5 million). Border Projects Other communities along the California/Mexico border have received $43.8 million for eight projects (total cost $127.1. million). Communities along the Texas/Mexico border have been the biggest beneficiaries of NADBank programs,

receiving some $138.15 million for .13 projects (total cost $518.86 million). NADBank has clearly demonstrated an ability to leverage the capital resources available to it into considerably greater total financing for projects. But the bank could do much more if it were not constrained by a mandate which imposes a limited geographic scope on its activities and requires it to focus narrowly on projects involving water pollution, wastewater treatment and

municipal solid waste management. This restricted mandate results in under-utilization of NADBank's lending capacity, which severely limits the bank's ability to generate revenues and provide for future loans and grants ,

which translates overall into less funds being available for the infrastructure needs of the border-region communities NADBank is supposed to serve. At

present, NADBank's total lending capacity of some $2 billion has been virtually untouched. The bank's own loans for the 29 projects mentioned above total only $11.12 million. Too Few Projects The bank has had to rely on grants for the balance of the $265.4

million authorized for these projects largely because most of the communities involved are poor, with little

ability to repay debt. Moreover, the bank's projections for the next decade indicate

that viable projects in the water and municipal solid waste sectors will never use more than 10 percent of its lending capacity, also because

most of the communities involved will be too poor to afford loan programs. If NADBank continues to be constrained by the narrow terms of its existing mandate, it appears destined to become a stagnant institution , of little relevance to the developmental needs of the border region, even as these needs grow and become more urgent. The population of the border region is projected to increase by 50 percent over the next 20 years. Sustainable development in the face of this kind of population growth cannot be had simply by concentrating on water and municipal solid waste projects. Expanded Mandate Proposed NADBank has, therefore, proposed an expanded mandate which would create a much larger and more economically viable lending market and enable the bank to address a wide variety of infrastructure needs in the region. A proposed geographic extension of the mandate to 300 kilometers on either side of the border would allow the inclusion of many additional communities that are naturally affected by growth along the border, and whose economies are often directly tied to the border-region economy. It would increase the population covered by NADBank's mandate from the current 10.6 million to 41 million and include such major population centers as Los Angeles, Phoenix and San Antonio on .the U.S. side, and Hermosillo,

Chihuahua, Saltillo and Monterrey on the Mexican side. NADBank has also proposed changes to its mandate which

would give the bank flexibility to undertake an assortment of infrastructure projects in order to diversify lending prospects and meet the broader developmental needs and environmental concerns of border-region communities. Greater Range Of Projects

Under this more flexible mandate, NADBank would be able to engage in a range of projects extending well beyond the narrow focus of its existing mandate. This new range of projects could include, for example: • Industrial

and hazardous waste treatment projects for maquiladoras and other industries; • Urban transportation and mass transit projects; • Affordable housing and housing improvement programs; • Air quality projects; • Agricultural and municipal water conservation projects; • Home water and wastewater installation programs; • Energy

projects from biomass and wind, geothermal, and solar power. An expanded mandate for NADBank makes good sense for the future prosperity and growth of the San Diego/Tijuana

region. NADBank projects promote sustainable development and enhance the quality of life of people in our region.

That kills the bank entirelyVanderpool, 06 (Tim, “NADBank Blues Will border cleanup efforts be abandoned?,” Tucson Weekly, 4/16/06, http://www.tucsonweekly.com/tucson/nadbank-blues/Content?oid=1083801)

"It looks as if the NADBank has been saved for now," says Robert Varady. "But it came very close to being eliminated." Down in Nogales, Ariz., a single sewer plant serves as brick-and-mortar kidneys for both sides of the U.S.-Mexico line. On good days, this old plant copes with waste seeping along overworked pipes and into its odorous bowels. But on bad days, it can receive nearly double its daily, 17.3 million-gallon capacity. When that happens, Nogales is awash in sewage. The stench wafts up manholes and backs into toilets. It's likely this routine predicament would be tolerated nowhere else in America. But down here, it's been going on for years. And for years, Nogales officials have pleaded with federal officials for help. Assistance finally arrived in December, with a $59.5 million grant to build a new plant. And that's when word arose that the North American Development Bank--the binational institution financing this new plant--was on the verge of collapse. "At that point, all bets were off," says Hugh Holub, Nogales' special projects director. "We were moving into the final stages of issuing a contract for the design and building of (the new) treatment plant. So of course, if the bank was demolished before we get to that point, we'd be up a creek." Robert Varady was also watching closely. He's deputy director of the UA's Udall Center for Studies in Public Policy and a member of the Good Neighbor Environmental Board, a federal committee advising the president and Congress on

border environmental needs. "It looks as if the NADBank has been saved for now," he says. "But it came very close to being eliminated." So what's behind the near-demise of a vital institution you've mostly likely never heard of? Some point to Mexican nationalism. But others blame the Bush administration's anti-environmental

impulses. "Administration officials don't see it as a priority," says one border watcher, who requested

a name not be used. "And they don't figure there are many votes along the border to worry about." To many others, however, this obscure bank is key to improving the lives of some 8 million residents along the impoverished U.S.-Mexico border. The NADBank was an outgrowth of the North American Free Trade Agreement, or NAFTA, enacted by Canada, the United States and Mexico in 1993. Headquartered in San Antonio, Texas, it was essentially created to quiet environmentalists and Latino activists, who feared the free-trade compact would further industrialize an already heavily polluted borderland. With $3 billion in lending capital--provided in equal shares by the United States and Mexico--the bank has since helped finance 90 projects, and another 59 are in the pipeline. At the same time, NADBank funding also triggers U.S. Environmental Protection Agency grants. In total, it is

responsible for $2.35 billion in regional improvements, ranging from clean-water systems and dust-reducing pavement projects to crucial waste facilities in Arizona communities such as Bisbee, Yuma and Nogales. Still, the NADBank has been no stranger to criticism. Environmentalists condemn its secretive operating style, while others have chastised the bank's inability to offer lower-interest loans to desperately poor communities. Congress liberalized the finance rate

structure in 2001, allowing the bank more loan flexibility. But the criticism has nonetheless grown among U.S. Treasury Department officials, who target the bank's administrative costs totaling about $80 million over the past dozen years. There are also NADBank critics south of the line. According to Hugh Holub, they include officials at Mexico's treasury department, Hacienda. "We were getting info that the attack (on NADBank) was coming from Hacienda," Holub says. "The EPA reaches through the NADBank to (provide grants). So you have the EPA setting all these terms and conditions for spending that money. The Mexicans didn't particularly like having conditions imposed on them--conditions that were impinging on their sovereignty." Attempts to contact Hacienda officials for comment were unsuccessful. Nancy Woo is associate director of the EPA's Region 9 Water Division. She denies that the agency is heavy-handed in Mexico. "I don't think that's an issue," she says from her San Francisco office. For example, "We have a very good

working relationship with (Mexico's) federal water authority." This conflict hit a fever pitch last year, when word leaked out that NADBank's future was under discussion between U.S. Treasury and Hacienda negotiators. Those murky bull sessions reportedly included disbanding the NADBank altogether. Such claims are denied by Brookly McLaughlin, a Treasury Department spokeswoman. "There has probably been some confusion," she says. "There were all these reports that we were talking about closing the bank, and

we never said that. We had no intention to close the bank." Not true, says NADBank spokesman Juan

Antonio Flores. "We learned in late January that there were discussions among some representatives at the U.S. Treasury and Hacienda," he says. "They were looking at the role of the bank and what its future may be. Among options being considered was possible closure of the bank." Still, Treasury Department officials have been more honest about their ongoing complaints. "Our concern is with the functioning of the bank," says McLaughlin. "We think the

administrative costs are pretty high." But that's disingenuous, says Stephen Niemeyer, a policy analyst at the Texas Commission on Environmental Quality. He says the initial rules governing NADBank "were really poorly written, and they really handicapped its functions. You have no one to blame for that but the U.S. Treasury. They were involved in the drafting of it." Likewise for criticism of the NADBank's lending practices. "What's amazing is that the NADBank is criticized for having poor lending rates, but it's really not their problem," says Niemeyer. "The people who are able to make the changes--the U.S. Treasury Department--have elected not to do it." Regardless, the bank's latest reprieve is due primarily to pressure from border-area leaders. In March, for example, eight congressional members, including Rep. Raul Grijalva, dispatched a letter to Treasury Secretary John Snow expressing "strong support" for the NADBank. A similar missive was drafted by the Good Neighbor Environmental Board, says Robert Varady. "The very fact that you have all these border congressmen and other institutions screaming that it shouldn't be done away with, that indicates something." Meanwhile, back in Nogales, Hugh Holub is keeping his fingers crossed--and his nose pinched. "The money isn't in some account," he says. "It's just a commitment that's on somebody's electronic books. And the big contract which creates an irrevocable momentum for this project won't occur until July or August. Anything that torpedoes this between then and now puts us at risk."

NADBank key to environmental cooperationTaj, 06 (Mitra, “Possible shutdown of NADBank worries some U.S. lawmakers,” Tucson Citizen, 3/16/06, http://tucsoncitizen.com/morgue2/2006/03/16/152961-possible-shutdown-of-nadbank-worries-some-u-s-lawmakers/)

“I don’t want to see the NADBank go away,” she said. “It needs to reform itself to be relevant to the communities it serves.” Those communities, Bronson said, are some of the poorest in the country, and need more affordable lending, not less. Holub said the only other institution to which the city

could have turned would have been Congress, a historically unreliable funding source for projects along the border. “That’s why the NADBank was created in the first place. Environmental problems had become so enormous along the border,” Holub said, “and

Congress was simply not meeting our needs.” Bronson said because environmental problems span both sides of the border, border solutions should also. “There has to be an international agency that works on making improvements on both sides of the border,” Bronson said. Flores said that although

the NADBank is doing more to help border communities tackle environmental problems, the binational approach to solving binational problems has been a success so far. “We’ve brought to the

board’s attention what we see to be current limitations and obstacles to further enhancing the quality of life in the

border regions,” Flores said. “We’ve done that.” For officials in border regions, improving the bank to make it

more responsive to the environmental needs of border citizens would be a welcome move.

Cooperation is key to prevent mass biodiversity lossVan Schoik, 04 – Rick, teaches international environmental security, science, and policy at San Diego State University, California (“Biodiversity on the U.S.-Mexican Border,” World Watch Institute, http://www.worldwatch.org/node/567)

The U.S.-Mexican border region has the highest rate of species endangerment in the United States. Some 31 percent of the species listed as endangered by the U.S. Department of Interior are found in the region. On the Mexican side of the border, 85 species of plants and animals are

endangered. Not surprisingly, the threats to these species are exacerbated by the fact that the ecosystems in this region are split by a political boundary that greatly

complicates conservation efforts. The area along the U.S.-Mexican border has seen extraordinary population growth, and the resulting residential and industrial sprawl along the border can evoke a doomsday vision for the entire strip from the Pacific to the Gulf of Mexico. Already, habitat loss is estimated at 2.5 hectares (more than 6 acres) per day within Tijuana alone. Last summer a coalition of U.S. and Mexican conservation biologists and other experts (the Southwest Consortium for Environmental Research and Policy) met to discuss possible ways of responding to this mounting border crisis. Well aware that the most important principle of biodiversity conservation is the need to protect the largest possible intact landscapes, we focused on identifying ways in which protections could be established that, in effect, crossed the border-regardless where the fences or guards might

stand-to encompass whole ecosystems. Establishing effective cross-border policies is not easy. While nations can readily agree to conserve migrating species in their territories, as when Mexico signed on to the United States' Migratory Bird Treaty Act to protect migrating birds half a century ago, protecting adjacent prime natural areas proves much more difficult. Designed to stop humans from freely crossing, borders also stop other species. Since 9/11, the U.S.-Mexican border has been further bolstered by both the Department of Homeland Security (DHS, which was formerly divided into the customs, border patrol, and immigration agencies) and the still somewhat-secret Joint Task Force Six (JTF-6, a multi-service command charged with providing counter-drug-trafficking support). These agencies' efforts and physical infrastructure have done significant damage to wildlife habitats. Their use of sensor fields, roads, and triple fences up to 50 meters deep create erosion and dust. The physical presence of vehicular patrols, all-night artificial lighting, noise, dragging of screens to clear a slate that makes footprints visible, and the clearing of brush also degrade sensitive habitat as homeland security forces seek view and access points. Along the San Diego segment, a proposal to install triple fencing now pits the federal government's ambitions to secure borders against the state and local jurisdiction over environmental issues. "The project would cut a 150-foot swath across a habitat that is home to some of the state's rarest plants and at least three endangered wildlife species," writes California environmental

journalist Terry Rodgers. While borders make environmental protection more difficult in many respects, they can

also provide unique opportunities for conservation-provided that the neighboring nations are amenable to cooperation. One such form of cooperation is through the designation of parks along borders as "peace parks." During the past year, Israel and Jordan's agreement to build an environmental studies center over their common border illustrated the ability of environmental concerns to serve as a sign that the link between biodiversity and security can be turned around so that it is not seen as an impediment or cost

of security but as augmenting security. Conservation attitudes are hugely complicated by poverty and asymmetry at this border. "The [Mexican] green world is ravaged by people whose only path from starvation lies in slashing and burning the jungle to plant a patch of corn," observed New York Times reporter Tim Weiner in 2002. Even in the relatively affluent border region of Mexico, the economic asymmetry between the two countries is so sharp-and land-use so different-that the border is starkly visible to people flying over in airliners.

Border biodiversity is key to survivalNabhan, 00 – Gary Paul, writer, lecturer and world-renown conservation scientist (“Biodiversity: The Variety of Life that Sustains Our Own,” Arizona-Sonora Desert Museum, January 2000, http://www.desertmuseum.org/books/nhsd_biodiversity.php)

An excerpt from A Natural History of the Sonoran Desert There is a place in the Sonoran Desert borderlands which, more than any other I know, capsulizes what the term diversity has come to mean to both natural and social scientists alike. The place is a desert oasis known as Quitobaquito, centered on a spring-fed wetland

at the base of some cactus-stippled hills that lie smack dab on the U.S.-Mexico border. Whenever I walk around there, I am astounded by the curious juxtapositions of water- loving and drought-tolerating plants, of micro-moths wedded to single senita cacti, and hummingbirds that have traveled hundreds of miles to visit ocotillos, of prehistoric potsherds of ancient Patayan and Hohokam cultures side by side with broken glass fragments left by O'odham, Anglo- and Hispanic-American cultures. Walk down from its ridges of granite, schist, and gneiss, and you will see organpipe cactus growing within a few yards of arrowweed, cattails, and bulrushes immersed in silty, saline sediments. The oasis has its own peculiar population of desert pupfish in artesian springs just a stone's throw from the spot where a native caper tree makes its only appearance in the United States. The tree itself is the only known food source for the pierid butterfly that is restricted in range to the Sonoran Desert proper. More than 270 plant species, over a hundred bird species, and innumerable insects find Quitobaquito to be a moist harbor on the edge of a sea of sand and cinder. Not far to the west of this oasis, there are volcanic ridges that have frequently suffered consecutive years without measurable rainfall, and their impoverished plant and animal communities reflect that. Quitobaquito is naturally diverse, but its diversity has also been enhanced rather than permanently harmed by centuries of human occupation. Prehistoric Hohokam and Patayan, historic Tohono O'odham, Hia c-ed O'odham, Apache, Cucupa, and Pai Pai visited Quitobaquito for food and drink long before European missionaries first arrived there in 1698. Since that time, a stream of residents from O'odham, exican, Jewish, and Mormon families have excavated ponds and irrigation ditches, transplanting shade and fruit trees alongside them. They intentionally introduced useful plants, and accidentally brought along weedy camp-followers, adding some fifty plant species to Quitobaquito over the centuries. Native birds and mammals have also been affected by human presence there, and some increased in number during the days of O'odham farming downstream from the springs. All in all, Quitobaquito's history demonstrates that the desert's cultural diversity has not necessarily been antithetical to its biological diversity; the two are historically intertwined. In fact, the Sonoran Desert is a showcase for understanding the curious interactions between cultural and biological diversity. There are at least seventeen extant indigenous cultures that each has its own brand of land management traditions, as well as the dominant Anglo- and Hispanic-American cultures which have brought other land ethics, technologies, and strategies for managing desert lands into the region. While some cultural communities such as the Seri were formerly considered passive recipients of whatever biodiversity occurred in their homeland, we now know that they actively dispersed and managed populations of chuckwallas, spiny-tailed iguanas, and columnar cacti. Floodwater farmers such as the Tohono O'odham and Opata dammed and diverted intermittent watercourses, planted Mesoamerican crops, and developed their own domesticated crops from devil's claw, tepary beans, and Sonoran panic grass. Anglo- and Hispanic-American farmers and ranchers initiated other plant and animal introductions, and dammed rivers on a much larger scale. Each of these cultures has interacted with native and exotic species at different levels of intensity, including them in their economies, stories, and songs. From an O'odham rainmaking song that echoes the sound of spadefoots, to the Western ballad "Tumblin' Tumbleweeds" written in Tucson over a half century ago, native and invasive species have populated our oral and written traditions as curses, cures, and resources. Technically speaking, this stuff we call diversity eludes one single definition. For starters, however, biodiversity (short for biological diversity) can be generally thought of as the "variety of life on earth." Scientists use this term when discussing the richness of life forms and the heterogeneity of habitats found within or among particular regions. Biodiversity in this sense is often indicated by the relative richness of species in one habitat versus another. Thus it is fair to say that riparian gallery forests of cottonwoods and willows along desert rivers typically support more avian biodiversity-a greater number of bird species-than do adjacent uplands covered with desertscrub vegetation. Similarly, there is greater biodiversity in flowering vines in the moist tropical forests of southern exico than there is in the Sonoran Desert of northern Mexico. It is worth noting, however, that ecologists such as E.O. Wilson first coined the term biodiversity to signify something far more complex than the mere number of species (termed species richness) found in any given area. Usually ecologists also consider the number of individuals within each species when they assess diversity or heterogeneity. An area where one desert wildflower such as the California poppy dominates eight other species is considered to be less diverse than an area with the same eight species where the numbers of each are more evenly distributed. As Kent Redford of The Nature Conservancy has recently explained, "A species-focused approach to biodiversity has proved limiting for a number of reasons....[The] use of just species as a measure of biodiversity has resulted in conservation efforts focusing on relatively few ecosystems while other threatened ones are highly ignored. Species do not exist in a vacuum, and any definition of biodiversity must include the ecological complexes in which organisms naturally occur and the ways they interact with each other and with their surroundings." The integrity of biodiversity can be teased apart into the following components. Although each of them may be separated out by scientists for study, they do not truly exist "apart" from one another. ECOSYSTEM DIVERSITY: the variety of landscapes found together within any region, and the ways in which their biotic communities interact with a shared physical environment, such as a watershed or coastal plain. A landscape interspersed with native desert vegetation, oasis-like cienegas, riparian woodlands, and croplands is more diverse than one covered entirely by one crop such as cotton. The Colorado River Delta was once a stellar example of ecosystem diversity, displaying a breath-taking mixture of riparian gallery forests, closed-canopy mesquite bosques, saltgrass flats, backwater sloughs, rivers, ponds, and Indian fields. Much of it is now dead, except for the hypersaline wetlands known as the Cienega de Santa Clara. BIOTIC COMMUNITY DIVERSITY: the richness of plants, animals, and microbes found together within any single landscape mosaic; such a mosaic can range in scope from the regional to the watershed level. This richness can be shaped by a variety of factors, ranging from the age of the vegetation to land use to soil salinity and fertility. For example, the number of species on well-drained, ungrazed desert mountain slopes covered by columnar cacti, ancient desert ironwoods, and spring wildflowers is greater than that on an alkali flat grazed by goats, where only saltbush, saltgrass, and seepweed may grow. The Rincon ountains east of Tucson demonstrate a gradient of communities, each with its own diversity, as they rise from desertscrub to xeric woodlands, and coniferous forests. INTERACTION DIVERSITY: the complexity of interactions within any particular habitat, such as the relationships between plant and pollinator, seeds and their dispersers, and symbiotic bacteria and their legumes. A pine-oak woodland in Arizona's "sky islands"harbors more interspecific interactions than does an even-aged pine plantation. Ramsey Canyon in the Huachuca ountains showcases such interaction diversity, with over a dozen hummingbirds, as well as bats, bees, and butterflies visiting its myriad summer flowers. SPECIES DIVERSITY: the richness of living species found at local, ecosystem, or regional scales. A well-managed desert grassland hosts more species than can be found in a buffelgrass pasture intentionally planted to provide livestock forage without consideration of wildlife needs. Quitobaquito, discussed above, is as fine an example of localized species diversity as we have anywhere in the binational Southwest. GENETIC DIVERSITY: the heritable variation within and between closely-related species. A canyon with six species of wild out-crossing beans contains more genetic variation than does a field of a single highly-bred hybrid bean. Indian fields in southern Sonora demonstrate this concept, for their squashes hybridize with weedy fieldside gourds, and their cultivated chile peppers are inflamed by genetic exchange with wild chiltepines. All of these components of biodiversity ensure some form of environmental stability to the inhabitants of a particular place. A landscape with high

ecosystem diversity is not as vulnerable to property-damaging floods as a bladed landscape is, for a mix of desert grassland and wetlands serves to buffer downstream inhabitants from rapid inundations. A diverse biotic community is less likely to be ravaged by chestnut blight or spruce budworm than a tree plantation can be. A cactus forest with diverse species of native, wild bees is less vulnerable to fruit crop failure than are orchards or croplands that are exclusively dependent upon the non-native honeybees. A desert grassland with multiple species of grasses and legumes cannot be as easily depleted of its fertility and then eroded as can one with a single kind of pasture grass sucking all available nutrients out of the ground. And finally, a Pima Indian garden intercropped with many different kinds of vegetable varieties will not succumb to white flies or other pests as easily as will an expansive, irrigated lettuce field in

the Imperial Valley. In short, more of "nature's services" - the economic contributions offered by intact ecosystems-are possible when we manage these ecosystems to safeguard or restore their biodiversity, and not allow it to be depleted. Recent estimates by environmental economists suggest that the dollar value of the services such as flood protection and air purification provided by the world's intact wild ecosystems averages thirty-three trillion dollars per year, compared to the eighteen trillion dollar Gross National Product of all nations' human-made products. The message is clear: when a mosaic of biotic communities is saved together and kept healthy within a larger landscape, few endangered species fall between the cracks and succumb to extinction processes. In contrast, a small wildlife sanctuary designed to save a single species often fails to achieve its goal, for the other organisms which that species ultimately needs in its presence have been ignored or eliminated. Not only do humans benefit from the conservation of large wildlands landscapes, but many other species do as well. How does this play out in our Sonoran Desert region? Ask most people to characterize life in the desert and few will think to mention the word "diversity"as part of their thumbnail sketch of this place. Most of us keep in our heads those pictures of bleak, barren, blowing sandscapes when we hear the word "desert." The Sonoran Desert does contain one major sea of sand, as well as a long corridor of coastal dunes along the Gulf of California, but even these are seasonally lush with unique and thriving life forms. As one spends more time in a range of Sonoran Desert habitats, one is constantly surprised by how many plants and animals are harbored here. Travel out of Sonoran Desert vegetation into the higher mountain ranges held within the region and even more astonishing levels of biodiversity can be found. In fact, the "sky islands"of southeastern Arizona and adjacent Sonora are now recognized by the Inter-national Union for the Conservation of Nature as one of the great centers of plant diversity north of the tropics. When we compare our desert with others, the contrast is striking. Overall, the Sonoran Desert has the greatest diversity of plant growth forms- architectural strategies for dealing with heat and drought-of any desert in the world. From giant cacti to sand-loving underground root parasites, some seventeen different growth forms coexist within the region. Often, as many as ten complementary architectural strategies will be found together, allowing many life forms to coexist in the same patch of desert. Biodiversity in the desert is often measured on a scale that would not be used in the tropical rainforest. Desert ecologists have found twenty kinds of wildflowers growing together in a single square yard (.84 m2), while a single tropical tree might take up the same amount of space. On an acre (.4 ha) of cactus forest in the Tucson Basin, seventy-five to 100 species of native plants share the space that three mangrove shrubs might cover in swamp along a tropical coast. These levels of diversity are a far cry from the "bleak and barren" stereotype, and it may well be that the Sonoran Desert region is more diverse than other arid zones of comparable size. Consider for example, the flora of the Tucson Mountains, which Arizona-Sonora Desert Museum research scientists recently inventoried with a number of their colleagues. In an area of less than forty square miles (100 km2), this botany team encountered over 630 plant species-as rich a local assortment of plants as any desert flora we know. This small area contains roughly one-sixth of the Sonoran Desert's entire plant diversity. It is disproportionately rich relative to its size, its paucity of surface water, and its elevational range. Such a diversity of wildflowers and blossoming trees attracts a diversity of wildlife as well. In the Sonoran Desert area within a thirty mile radius of Tucson, you can find between 1000 and 1200 twig- and ground-nesting native bees (all of them virtually "stingless"). As the Desert Museum's research associate Stephen Buchmann wryly notes, "this may mean that the Sonoran Desert region is the richest bee real estate anywhere in the world-the entire North American continent has only 5000 native bee species." Desert wildflowers attract more than bees. Southern Arizona receives visits from more hummingbird species-seventeen in all-than anywhere else in the U.S. Other pollinator groups, such as butterflies and moths, are well-represented in the region as well. Single canyons near the Arizona-Sonora border may harbor as many as 100 to 120 butterfly species, and moth species may number five to ten times higher than that in the same habitats. When all pollinating organisms breeding or passing through here are counted, it may be that the greater Sonoran Desert has as large a pollinator fauna as any bioregion in the world. This region is also rich in small mammals and reptiles. Some eighty-six species of mammals have ranges centered within the San Pedro National Riparian Area alone, a record unsurpassed by any natural landscape of comparable size in the U.S.; the area contains half of all mammal species in the binational Sonoran Desert. At least ninety-six species of reptiles are endemic to the Sonoran Desert-found here and nowhere else in the world. Why is such diversity present in a land of little rain? For starters, our bimodal rainfall pattern brings out completely different suites of wild-flowers and their attendant insects at different times of the year. In addition, we benefit from a more gradual transition between tropical nature and desert nature than does the Chihuahuan Desert on the other side of the Sierra Madre-many tropically-derived life forms reach their northernmost limits in the Sonoran Desert due to its relatively frost-free climes. Of course, tropic rainforests are much more diverse in the total number of species they have throughout their biome, in part because of their ages and their high energy budgets. However, there may be more turnover in species from place to place in the Sonoran Desert than in some tropical vegetation types. That is to say, many desert plants and insects are "micro-areal" - occurring only within a 100 by 100 mile spots on the map. Particularly in Baja California, there are extremely high levels of endemism, including some 552 plants unique to the peninsula. Nevertheless, it remains true that the highest levels of local diversity in this desert region occur where water accumulates. Some of the highest breeding bird densities recorded anywhere in the world come from riparian forests along the Verde and San Pedro river floodplains. More than 450 kinds of birds have historically nested or migrated along the Colorado, San Pedro, and Santa Cruz rivers. And yet, if riparian habitats were among our richest, what have we lost with the removal of cottonwoods from ninety percent of their former habitat in Arizona? Ornithologists cannot name a single Sonoran Desert bird that has gone extinct with riparian habitat loss, but many of the eighty species of birds dependent on these riparian forests have locally declined in abundance. A single desert riparian mammal-Merriam's mesquite mouse-is now extinct due to the loss of riparian habitat at the hand of groundwater pumping, arroyo cutting, and overgrazing. exican wolves and black bears that formerly frequented our river valleys are among those mammals no

longer found in the Sonoran Desert proper. Conservation International has estimated that as much as sixty percent of the entire Sonoran Desert surface is no longer

covered with native vegetation but is dominated by the 380-some alien species introduced to the region by humans and their livestock. Alien plants such as buffelgrass now

cover more than 1,400,000 acres of the region, at the expense of both native plants and animals. Tamarisk trees choke out native willow and cottonwood seedlings. Invasive weeds such as Johnson grass and Sahara mustard have taken over much of certain wildlife sanctuaries and parks in the desert, outcompeting rare native species. Other invasive species such as Africanized bees and cowbirds also compete with the native fauna. Biological invasions are now rated among the top ten threats to the integrity of Sonoran Desert ecosystems, whereas a half century ago they hardly concerned ecologists working in the region. These invaders somehow reach even the most remote stretches of the desert, to the point of being ubiquitous. The wholesale replacement of natives by aliens is

enough of a problem, but desert biodiversity has been even more profoundly affected by habitat fragmentation-the fracturing of large tracts of desert into pieces so small that they cannot sustain the interactions among plant, pollinator, and seed disperser. Such fragmentation does not necessarily lead to immediate extinctions, just declines-

there is a time lag before a species' loss of interactions with others leads to complete reproductive failure. Fragmentation caused by urbanization is now considered the number-one threat to the biodiversity of the region and is not expected to diminish during our lifetimes. The population of Arizona's Maricopa County in the year 2025 is expected to be two and a half times what it was in 1995, and similar growth rates are

anticipated along the entire desert coastline of the Sea of Cortez. In a sense, humans are making the Sonoran Desert much more like the old (and erroneous) stereotype of a barren wasteland. As more than forty dams were constructed along rivers in this century, old-timers witnessed hundreds of miles of riparian corridors dry up. Groundwater overdraft has also impoverished desert and riparian vegetation, as farms and cities pump millions more acre-feet out of the ground than rainfall in the region can naturally recharge. The roots of plants are left

high and dry above the water table. Most of the Sonoran Desert was not at all naturally barren, but our misunderstandings have impoverished one of the richest arid landscapes on the planet. That is why the Desert Museum has endorsed a long-term Conservation Mission

Statement which begins with these words from ecologist D.M. Bowman: "So what is biodiversity?...the variety of life on this planet is like an extra-ordinarily complex, unfinished, and incomplete manuscript with a hugely varied alphabet, an ever-expanding lexicon, and a poorly understood

grammar....Ripping the manuscript to pieces because we want to use the paper makes little sense, especially if the manuscript says that 'to survive you shall not destroy what you do not understand'. Our mission as ecologists must be to interpret the meaning of biodiversity. The urgent need for this mission, and our current ecological ignorance, must be forcefully communicated to the public." Instead of seeing future inhabitants rip out any more pages essential to the desert's story, the conservation organizations of the region have begun to work together to ensure that the most important corridors

and secluded refugia for desert flora and fauna are identified and protected or restored. These critical areas - essential to the flow of diversity from source to sink, from headwaters to river mouth, and from tropical wintergrounds to summer nesting areas - must be kept from further fraying if the fabric of the Sonoran Desert is to remain intact. Scientists can prioritize such areas in terms of their value to biodiversity, but they will be safeguarded for future generations only if a broad spectrum of society is involved in endorsing their protection.

Mexico is a key region for biodiversityGeo Mexico 2010 (This blog supports Geo-Mexico; the geography and dynamics of modern Mexico, the book by Dr. Richard Rhoda and Tony Burton (Sombrero Books 2010). Geo-Mexico is the first book specifically about the geography of the entire country of Mexico, written in English and aimed at an adult audience, ever published, “Mexico’s mega-biodiversity,” http://geo-mexico.com/?p=2765)

People from elsewhere generally think of Mexico as an arid country with lots of cacti. The general impression is that Mexico has relatively little biodiversity in comparison with equator-hugging tropical countries such as Brazil and Indonesia. These impressions could not be farther from the truth. While northern Mexico is indeed arid, many areas in southern Mexico receive over 2,000 mm (80 inches) of annual precipitation, almost entirely in the form of rainfall. The rainiest place in Mexico— Tenango, Oaxaca—receives 5,000 mm (16.4 feet) of rain annually.

Straddling the Tropic of Cancer, Mexico is a world leader in terms of climate and ecosystem diversity. It is one of the only countries on earth with arid deserts, dry scrublands, temperate forests, high altitude alpine areas,

subtropical forests, tropical rainforests and extensive coral reefs. The multitude of ecosystems in Mexico supports a very wide range of biodiversity. * Mexico’s vegetation zones. The link is to a pdf map (in color) of vegetation zones. The map (all

rights reserved) is a color version of Figure 5.1 in Geo-Mexico. Mexico’s Environmental Ministry (SEMARNAT) indicates that there are over 200,000 different species in Mexico. This is about 10% – 12% of all the species on the planet. About half of all Mexico’s species are endemic; they exist only in Mexico. An unknown number of endemic species were forced to extinction by the intended and unintended importation of Old World species

by the Spaniards. The U.N. Environment Programme has identified 17 “megadiverse” countries. The list includes Mexico, the USA, Australia, five South

American countries, three African countries, and six Asian counties. Actually, Mexico is among the upper third of this group along with Brazil, Colombia, China, Indonesia and DRC (Democratic Republic of the Congo). The other countries on the list are: the USA, Venezuela, Ecuador, Peru, South Africa, Malagasy Republic, India, Malaysia, The Philippines, Papua New Guinea, and Australia.

Prevents extinctionGhista ’05 (Garda, freelance journalist and public advocate http://www.worldproutassembly.org/archives/2005/04/biodiversity_un.html “Biodiversity - Underprotected or Overprotected?”)

Biodiversity is crucial to human survival, and far greater efforts must get underway to

preserve biodiversity.[3] When we lose particular species, when they become extinct,it affects the entire ecosystem. In addition, potential drugs that could cure modern diseases are lost forever. For this very reason, if human beings do not take care of all other life forms on our planet, it is the people

themselves who will incur the greatest suffering as a consequence. While extinction of species is a normal process in nature, and while 99.9 percent of all species that once lived are now extinct, that process of extinction is a   gradual one   and   therefore   does not cause harm  to those left behind. If extinction occurs in a natural gradual manner, there will be new species to replace the old through allopatric or sympatric speciation.[4] Disease, new predators, climate change, habitat loss and other factors cause the

normal extinction of plant and animal life. However, what is happening today is something entirely different. Today it is the calculated actions of a few human beings � greedy capitalists for

whom money is the summum bonum of life � that are causing havoc to our environment.

NADBank KT Water stuffGAO 2k – US General Accounting Office, Report to Congressional Requesters, (“US Mexico Border- Despite Some Progress, Environmental Infrastructure challenge remain” March 2000, http://www.gao.gov/assets/230/228734.pdf)

The Border Environment Cooperation Commission’s primary function is to certify that proposals submitted by border communities for environmental infrastructure projects meet criteria for technical and financial feasibility and that the projects are environmentally sound, self-sustaining, and supported by the public. The Border Commission also assists states and localities in the preparation, development, implementation, and

oversight of environmental projects in the border region. Based on guidance in the Border

Commission’s charter , the board of directors has limited its area of consideration to water, wastewater, and solid waste disposal . The Border Commission emphasizes the importance of project sustainability in its certification process because, in the

past, projects have been built in poor communities with grants and other assistance that could not be properly maintained due to the communities’ limited institutional capacity and financial resources . The Border Commission also provides technical assistance to border communities with project development activities, including devising plans, creating project designs, and performing environmental assessments. According to Border Commission officials, the process to develop and certify a project generally takes between 3 and 5 years, depending on (1) the complexity of the project, (2) the level of development a project is at when submitted, (3) the institutional capacity of the community, and (4) the amount of technical assistance the Border Commission needs to provide to the community. (Table 3 in app. I provides further details on the Border

Commission’s project identification and development process.) As of September 1999, the Border

Commission had certified 31 projects− 12 in Mexico and 19 in the United States . Twenty-eight projects are for water and wastewater treatment systems, and 3 are for solid waste disposa facilities. The total estimated construction cost of these projects is $680.2 million, and, when completed, they are expected to benefit a total of 6.7 million people. (See table 4 in app. I for more

details on the 31 Border Commission-certified projects.) The United States and Mexico provide annual appropriations to the B order E nvironment C ooperation C ommission to cover operational expenses. In addition, most of the Environmental Protection Agency’s technical assistance funding to U.S. and Mexican communities for water or wastewater treatment projects is provided through the Border Commission. (See table 6 in app. I for more details on Border Commission funding.)

Only projects certified by the Border Environment Cooperation Commission qualify for construction financial assistance from the North American Development Bank. The Bank’s primary purpose is to facilitate financing for the development, execution, and operation of environmental infrastructure projects . The Bank may make loans and/or loan guarantees, and it also administers Environmental Protection Agency grant funds through the Border Environmental Infrastructure Fund. Established in 1997, the Border Environmental Infrastructure Fund

provides grants to communities to reduce the total cost of needed projects. These grant funds may

be applied to water and wastewater projects on the U.S. side of the border and on the Mexican side, if the infrastructure deficiency affects both sides of the border. If grant funds are used on the Mexican side of the border, Mexico must provide an equal border investment. The Bank also provides technical assistance to communities to help them develop the financial and administrative capacities of utility managers and their staffs. The United States and Mexico agreed to contribute equally to the capitalization of the bank. The agreement called for a total of $3 billion− $450 million in paid-in capital and an additional $2.55 billion in callable capital. 8 Ten percent of the paid-in capital was earmarked to community adjustment and investment activities in both countries. To date, each country has contributed $174.4 million, or 78 percent, of the Bank’s paid-in capital, with the remaining paid-in capital to be paid by September 2004. As of September 1999, the Bank had obligated a total of $154.5 million in loans and grants to fund construction for 20 Border Commission-certified projects. Of the total, $11.2 million was provided through direct loans. These loans represent only 3.2 percent of the Bank’s total paid-in capital contributed to date. The biggest source of the Bank’s assistance has been through Border Environmental Infrastructure Fund grants, which had an initial funding of $170 million. All but 4 of the 20 Bank-financed projects had such grant funding. Since the creation of the Border Environmental Infrastructure Fund, $143.4 million have

been obligated—representing 93 percent of the total funds provided through the Bank. Applications

for $34.4 million were pending certification by December 1999, which will deplete the initial funding . However, as of December 1999, the Environmental Protection Agency allocated an additional $41 million to the Border Environmental Infrastructure Fund. According to

North American Development Bank officials, without continued funding for Border

Environmental Infrastructure Fund grants, environmental infrastructure development along the border will be jeopardized . Figure 2 shows the breakdown of all funding sources for the 20 projects. The Bank provided $85.2 million, or 21 percent, of U.S. project costs, and $69.3 million, or 50 percent, of Mexican project costs through loans or Environmental Protection

Agency grants. The grants , however, amounted to 96 percent and 88 percent of the Bank’s funds provided to U.S. and Mexican projects, respectively. (See table 7 in app. I for more details on the 20 Bank-financed projects.)

ExtinctionBarlow 2008 – Senior Advisor on Water to the UN General Assembly, chair of the Food & Water Watch, executive member of the International Forum on Globalization (2/25, Maude, Foreign Policy in Focus, "The global water crisis and the coming battle for the right to water", http://www.fpif.org/articlesthe_global_water_crisis_and_the_coming_battle_for_the_right_to_water)

The three water crises – dwindling freshwater supplies, inequitable access to water and the corporate control of water – pose the greatest threat of our time to the planet and to our survival. Together with impending climate change from fossil fuel emissions, the water crises impose some life-or-death decisions on us all. Unless we collectively change

our behavior, we are heading toward a world of deepening conflict and potential wars over the dwindling supplies of freshwater – between nations, between rich and poor, between the public and the private interest, between rural and urban populations, and between the

competing needs of the natural world and industrialized humans.

Around the world, more than 215 major rivers and 300 groundwater basins and aquifers are shared by two or more countries, creating tensions over ownership and use of the

precious waters they contain. Growing shortages and unequal distribution of water are causing disagreements, sometimes violent, and becoming a security risk in many regions. Britain’s former defense secretary, John Reid, warns of coming “water wars.” In a public statement on the eve of a 2006

summit on climate change, Reid predicted that violence and political conflict would become more likely as watersheds turn to deserts, glaciers melt and water supplies are poisoned. He went so far as to say that the global water crisis was becoming a global security issue and that Britain’s armed forces should be prepared to tackle conflicts, including warfare, over dwindling water sources. “Such changes make the emergence of violent conflict more, rather than less, likely,” former British prime minister Tony Blair

told The Independent. “The blunt truth is that the lack of water and agricultural land is a significant contributory factor to the tragic conflict we see unfolding in Darfur. We should see this as a warning sign.”

The Independent gave several other examples of regions of potential conflict. These include Israel, Jordan and Palestine, who all rely on the Jordan River, which is controlled by Israel; Turkey and Syria, where Turkish plans to build dams on the Euphrates River brought the country to the brink of war with Syria in

1998, and where Syria now accuses Turkey of deliberately meddling with its water supply; China and India, where the Brahmaputra River has caused tension between the two countries in the past, and where China’s proposal to

divert the river is re-igniting the divisions; Angola, Botswana and Namibia, where disputes over the Okavango water basin that have flared in the past are now threatening to re-ignite as Namibia is proposing to build a

threehundred- kilometer pipeline that will drain the delta; Ethiopia and Egypt, where population growth is

threatening conflict along the Nile; and Bangladesh and India, where flooding in the Ganges caused by melting glaciers in the Himalayas is wreaking havoc in Bangladesh, leading to a rise in illegal, and unpopular, migration to India.

The plan solves - expanding NADBank investments to border infrastructure allows for NADBank enhancement and avoids political backlashBalido, 11 – Nelson, president of the Border Trade Alliance (“Bill to expand NADBank projects holds potential to make big impact for border,” Border Trade Alliance, http://www.thebta.org/btanews/bill-to-expand-nadbank-projects-holds-potential-to-make-big-impact-for-border.html#top)

But Congress and the White House don’t have to look far for inspiration for how to finance infrastructure. There’s already a bank making a positive difference in infrastructure development that, with a legislative tweak here and there, can be even more impactful: the North American Development Bank. Over the past sixteen years of operation, the NADBank has been vitally important to improving basic services in the border region by financing numerous water, wastewater, solid waste and street paving projects, among others. To date, NADBank has provided approximately $1.24 billion in loans and grants to support 149 infrastructure projects in the border region, which represents a total investment of $3.26 billion and will benefit more than 12.8 million residents of the region. One particularly notable accomplishment is the significant improvement in wastewater treatment coverage on the Mexican side of the border. In 1995, it was estimated that 27 percent of wastewater generated in border communities was being treated. According to Mexico’s National Water Commission (CONAGUA), wastewater treatment coverage has now reached approximately 85 percent. This dramatic improvement is in large part due to the work of

NADBank. The bank remains limited, however, in the projects it can finance. Its charter permits the bank only to get involved in projects deemed to have a significant positive environmental impact. There have been cases where the NADBank has taken interest in projects involving international ports of entry that would

benefit an area’s economy and create new jobs. Yet the bank has been unable to deliver financing to such projects, over the objections of its board of directors, for not demonstrating a sufficient environmental benefit to merit NADBank financing. Rep. Rubén Hinojosa (D-Texas) has

introduced a bill, H.R. 2216, the NADBank Enhancement Act of 2011, which would broaden the scope of projects where the bank could provide financing. This would include projects that promote trade and commerce between the U.S. and Mexico, including port of entry modernization and construction projects. Perhaps the best thing about the bill is that it

doesn’t add a dime to the federal deficit or debt. Rather, the bill will help ensure NADBank’s existing capital is more fully utilized for the benefit of the U.S.-Mexico border region, and ultimately for the benefit of both the U.S. and Mexico.

***Solvency***

1ac – NADbank version

NADBANK solves – best format for the affNegroponte, 12/3/12 – Diana, Senior Fellow, Brookings Institution (“[F]acilitate the anticipated tripling of cross-border trade,” Americas Society/Council of the Americas, http://www.as-coa.org/articles/viewpoints-what-should-top-priority-be-us-mexican-relations)

In order to construct these roads, private-public partnerships are needed. The NADBANK,

established 20 years ago to support environmental projects, is the best placed to mobilize these partnerships. The bank's bylaws permit this. However, the environmental impact needs to be interpreted broadly. The Environmental Protection Agency (EPA) could recognize that new roads relieve the congestion and high levels of air pollutants at the border crossing itself. Use of access roads may spread pollution further inland, but the levels of

pollutants will be significantly lower than those currently suffered each side of the Rio Grande. NADBANK’s initiative and the White House leadership to facilitate EPA approval could lead to the development of access roads and decongestion at the actual border. Mexican presidential encouragement to NADBANK's directors to seek PPPs and U.S. presidential urging to the EPA for a broad

interpretation of its mandate could result in a decade's work of new infrastructure projects. This will facilitate the anticipated tripling of cross-border trade as both countries negotiate a Trans-Pacific Partnership and Mexico negotiates a Pacific Trade Alliance with its South American partners.

Presidential decisions to advance on instructing NADBANK to move forward with PPPs for these infrastructure projects are relatively easy. Their consequences will enhance the trade and prosperity of both nations.

The plan solves - expanding NADBank investments to border infrastructure allows for NADBank enhancement and avoids political backlashBalido, 11 – Nelson, president of the Border Trade Alliance (“Bill to expand NADBank projects holds potential to make big impact for border,” Border Trade Alliance, http://www.thebta.org/btanews/bill-to-expand-nadbank-projects-holds-potential-to-make-big-impact-for-border.html#top)

But Congress and the White House don’t have to look far for inspiration for how to finance infrastructure. There’s already a bank making a positive difference in infrastructure development that,

with a legislative tweak here and there, can be even more impactful: the North American Development

Bank. Over the past sixteen years of operation, the NADBank has been vitally important to improving basic services in the border region by financing numerous water, wastewater, solid waste and street paving projects, among others. To date, NADBank has provided approximately $1.24 billion in loans and grants to support 149 infrastructure projects in the border region, which represents a total investment of $3.26 billion and will benefit more than 12.8 million residents of the region. One particularly notable accomplishment is the significant improvement in wastewater treatment coverage on the Mexican side of the border. In 1995, it was estimated that 27 percent of wastewater generated in border communities was being treated. According to Mexico’s National Water Commission (CONAGUA), wastewater treatment coverage has now reached approximately 85 percent. This dramatic improvement is

in large part due to the work of NADBank. The bank remains limited, however, in the projects it can finance. Its charter permits the bank only to get involved in projects deemed to have a significant positive environmental impact. There have been cases where the NADBank has taken interest in projects involving international ports of entry that would benefit an area’s economy and create new jobs. Yet the bank has been unable to deliver financing to such projects, over the objections of its board of directors, for not demonstrating a sufficient environmental benefit to merit NADBank financing. Rep. Rubén Hinojosa (D-Texas) has

introduced a bill, H.R. 2216, the NADBank Enhancement Act of 2011, which would broaden the scope of projects where the bank could provide financing. This would include projects that promote trade and commerce between the U.S. and Mexico, including port of entry modernization and construction projects. Perhaps the best thing about the bill is that it doesn’t add a dime to the federal deficit or debt. Rather, the bill will help ensure NADBank’s existing capital is more fully utilized for the benefit of the U.S.-Mexico border region, and ultimately for the benefit of both the U.S. and Mexico.

Expansion of funding is key – otherwise huge funding cuts are inevitable. Its reverse causal – US actions causes Mexico to match our commitmentDavid Hendricks (writer for the San Antonio Express-News) June 2007 “NADBank faces funding woes” Lexis

Now that the North American Development Bank is back in the business of financing loans for badly needed

U.S.-Mexico border projects, it would be a shame if funding cuts led to new calls to close the bank .¶ The bank could face trouble as quickly as two years down the road because of a situation materializing now. Congress and the federal agencies need to understand this situation to avoid problems later.¶ Unlike other international development banks, the San Antonio-based NADBank has learned that mixing grants with loans makes utility projects successful. Impoverished communities cannot afford loans, even at zero interest rates, if residents can't pay high monthly utility bills.¶ The recipe for NADBank's success is blending

grants into loans from its own capital. The grants come from the U.S. E nvironmental

P rotection A gency's U.S.-Mexico Border Program; the loans come from money provided equally by the U.S. and Mexican governments .¶ On top of that, local Mexican governments often match the EPA grants. The grant-loan mix reduces loan repayment schedules to affordable levels.¶ EPA money now is drying up to almost nothing. In a few years, that could prevent NADBank from writing enough loans to justify its existence. ¶ NADBank faced closure in 2006 when government interference prevented its newly reorganized board from meeting for more than two years to approve loans. Rather than see the environmental bank disappear, members of Congress rescued it last year.¶ The new board now meets regularly, and a large number of loans and projects are under way.¶ Now, though, the NADBank can only hope that members of Congress ride to the rescue again.¶ The NADBank's grant funding started in 1998 with a $170 million lump sum from the EPA. Those grant amounts later settled at $50 million a year.¶ The current version of Congress' budget allocates a measly $10 million.¶ The EPA itself is to blame. It proposed the small amount because the NADBank hasn't spent $203 million in grant funds.¶ That money, though, already is committed to projects under construction, a fact that EPA leaders and many members of Congress simply do not understand or are choosing to exploit. Border communities do not get the grant funds until the projects are completed.¶ Water treatment and sewage plants, along with pipe systems, take years to build, so a lag in dispersing the grant funds always will exist.¶ Border-state members of Congress understand this situation. But other lawmakers and some EPA administrators don't or won't. Their opposition is threatening the NADBank's future.¶ NADBank somehow must overcome this perception problem to keep the grant pipeline flowing. At the same time, future water and sewage plant proposals are stacking up themselves.

Expanding NADBank to transportation infrastructure solves cross-border trade, growth, and relationsHS News (Hispanically Speaking News, Latin American News Organization) July 2011 “Creating North American Development Bank Seen as Good Economic Opportunity for Border Economy” http://www.hispanicallyspeakingnews.com/hispanic-business-news/details/creating-north-american-development-bank-seen-as-good-economic-opportunity-/8994/

Action to bring economic development to the US Mexico border is making its way through Congress by the expansion and enhancement of the NADBank.¶ The North American Development Bank (NADBank) was created out of the North American Free Trade Agreement (NAFTA) in 1993 to address environmental concerns that the members of Congress had and ensure precautions and measures were taken to have environmentally sound region in the U.S.-Mexico border.¶

The introduction of the “NADBank Enhancement Act of 2011”, allows the two governments to work together to add more benefits along the border region such as infrastructure, transportation and Ports of Entry improvements. The proposed legislation would inject new criteria into the mandate and open the NAD Bank to finance new infrastructure projects . According to the text of the bill “(3) change the purposes and functions of the Bank, including changes that would allow the Bank to finance infrastructure projects in the border region that promote growth in trade and commerce between the United States and Mexico, support sustainable economic development, reduce poverty, foster job creation, and promote social development in the region.’”¶ “We must continue our efforts to improve economic development and safety in the border areas of both the United States and Mexico,” said Congressman Ruben Hinojosa from Texas.¶ This bill, which Congressman Rubén Hinojosa and 19 co-sponsors introduced, is a bi-partisan and bi-national piece of legislation that

speaks to the healthy development along the U.S and Mexico border.¶ “Allowing the NADBank to develop and finance a broader range of infrastructure projects in the Mexico-US border region would further promote growth in trade between the United States and Mexico, and to foster greater prosperity in the border region ”, wrote Mexican Ambassador Arturo Sarukhan in a letter to Chairman Spencer Bachus.¶ The NADBank is funded by both the Mexican and US government and the proposed legislation would not increase the deficit or add to the national debt.

Government action is key to stimulate the private sector –provides incentive and reduces redundanciesU.S. Chamber of Commerce, 11 (“Steps to a 21st Century U.S.-Mexico Border” http://www.uschamber.com/sites/default/files/reports/2011_us_mexico_report.pdf SW)

We are encouraged by recent efforts by leadership at CBP to achieve our shared goal, but funding is needed now to signal to the private sector that the government is serious about this system. Our goal in the next three years should be the retirement of the U.S. Automated Commercial System and the full use of ACE by the entire trade community. We should also strive to ensure the development and

implementation of the International Trade Data System (ITDS). Unfortunately, there has been little progress made due to the lack of coordination between government agencies to harmonize data submission into the system. To date, companies are required to enter

repetitive data to each government agency involved. Simplifying the   entry process   for

tradedecreases costs for businesses and provides governments with more accurate and accessible information .

Federal leadership is key to effective policy – only way to capitalize on relationsWilson Center, 09 (7“THE UNITED STATES AND MEXICO: Towards a Strategic Partnership,” Woodrow Wilson Center Mexico Institute, January 2009, http://www.wilsoncenter.org/sites/default/files/The%20U.S.%20and

%20Mexico.%20Towards%20a%20Strategic%20Partnership.pdf)Red

The Obama administration and the incoming Congress have the opportunity to raise the level of attention given to Mexico and to pursue a strategic partnership based on consultation and cooperation around issues of shared national interest. Too often in the past, the U.S. government has pursued unilateral solutions to problems that require binational cooperation. There is no lack of policies towards Mexico in the U.S. government. Since the issues in the relationship

with Mexico almost always have domestic as well as foreign policy aspects, every department and almost

every agency of the U.S. government has some dealings with Mexico or the U.S.-Mexico border, as

do a range of state and local government agencies. The challenge is, therefore, to find strategic ways of building synergies among these multiple, disjointed, and often competing efforts that tie into a broad agenda for collaboration with Mexico around clearly

defined objectives that are in the national security interests of both countries. A strategic partnership between the two countries will require both high-level foreign policy

attention in Washington and Mexico City and efforts to engage all government actors at the federal, state, and local level involved in key policy decisions. It will be important to strengthen existing structures for consultation but also to develop new ones that can promote and sustain effective dialogue and problem-solving. There are at least four areas that call out for priority attention in the relationship and will require sustained dialogue and engagement: security cooperation, economic integration, immigration, and border management. Strengthening Security Cooperation Mexico and the United States share vital national security interests in making sure that the border is not used by terrorist organizations intent upon committing acts of large-scale violence. !ey also share a joint concern with the rise of transnational organized crime. Criminal activity associated with drug trafficking poses an increasing threat to communities on both sides of the border. Mexico is the largest transshipment point for cocaine en route to the United States, and is the largest foreign supplier of methamphetamines, heroin, and marijuana. In turn, profits from drug sales in the United States pump roughly $15 to $25 billion every year into illicit activities in Mexico, while over 90% of the arms used by drug traffickers are imported from the United States. Violence from drug trafficking has become endemic, and it has gradually penetrated into the politics of some local, state, and even federal government agencies. Meanwhile, the drug trade fuels crime in neighborhoods throughout the United States and grows particularly threatening in the border area. Although there is no evidence to date of terrorists using the Mexican border for attacks on the United States, clearly the existence of an extensive infrastructure linked to organized crime raises concerns about possible future threats. Recent efforts between the two countries to strengthen intelligence sharing, technology transfer and training, including the bipartisan passage of the Mérida Initiative, have built a strong framework for future efforts at cooperation. Much more can be done to deepen these efforts, however, and a new administration should look for ways to forge a comprehensive approach against organized crime that combines (1) law enforcement cooperation, especially targeted efforts at disrupting money and arms supplies (2) strengthening police and judicial institutions in Mexico, and (3) reducing the demand for narcotics in the United States. !is would mark a major departure in U.S. drug control policy in the past but one that would have significantly more chances of success than previous efforts. Managing Economic Integration !e United States and Mexico have undergone an accelerated process of economic integration over the past two decades. Trade has tripled between 1990 and 2008, due in large part to the North American Free Trade Agreement (NAFTA). Mexico is now the United States’ third largest trading partner and the second destination of exports, accounting for roughly one-eighth of all U.S. exports. Border states are particularly dependent on trade with Mexico, but so are states that are distant from the border such as Nebraska, Indiana, and Iowa. !e United States also depends on

Mexico for more than one-tenth of its petroleum imports. Even the labor markets of the two countries have become increasingly intertwined, with immigrant workers from Mexico accounting for a significant part of U.S. labor market growth and contributing to the solvency of U.S. entitlement programs by providing new tax revenues. Despite these trends, not enough attention has been given to deepening economic integration beyond trade and investment. NAFTA did not attempt to stimulate the type of economic development needed to promote job creation and a more equitable income distribution. A forward-looking agenda should now address three basic concerns. First, it should seek to raise living standards and reduce income disparities. Narrowing the income gap between Mexico and its two NAFTA partners, in particular, would help curb Mexican migration to the United States. Second, it should reduce non-tariff barriers to trade (such as poor border infrastructures and complex differences in national standards) that have made it particularly difficult for small and medium businesses to become involved in crossborder business. !ird, it should acknowledge Mexico’s special vulnerability to economic turmoil in the United States and in global markets and seek to prevent an economic slowdown from turning into a full-blown crisis, with significant spillover effects for the U.S. economy. Addressing Immigration Migration is transforming the social fabric and economies of both the United States and Mexico. Today over 12 million Mexicans live in the United States, roughly half of them without legal documents. Roughly one-third of all U.S. immigrants come from Mexico, with about 300,000 new unauthorized immigrants arriving each year. While immigration produces net benefits to the U.S. economy as a whole, the rapid pace of immigration and the unauthorized status of so many immigrants pose specific challenges for integration, wage competition, and labor rights. And while Mexican migrants send roughly $23 billion back home in remittances, there is no question that the loss of so many of the country’s most entrepreneurial citizens represents a net loss for Mexico’s competitiveness. Most of the efforts needed to provide alternatives to migration and manage future flows will have to be taken unilaterally in one country or the other; however, the effects of measures taken in one country will have profound effects on the other. Strategic thinking between the two countries could provide incentives and opportunities to pursue the best policy options available. A permanent dialogue between the two countries on migration can help produce the best policies available, even though each country will need to pursue its own efforts to deal with particular policy reforms. Investing In Border Communities The border has become a microcosm of all the challenges that the two countries face in trying to deal with each other effectively. At the border bottlenecks caused by deficient infrastructure raise the cost of trade and limit cross-border ties; unilateral strategies for security play out against the need for cross-border cooperation in law enforcement; and the challenges of clean air and sufficient water remind people that natural resources know no political boundaries and require joint responsibility. U.S. border communities remain among the poorest in the United States, with average incomes a third less than in the rest of the country, and significant deficits in employment and infrastructure, despite the comparative advantages that border communities should have as international gateways. At

the same time, border communities have become laboratories of experimentation in

creative efforts at international cooperation. Most have developed binational mechanisms to manage resources, respond to natural disasters, ensure public security, and promote development, generally at the margins of

federal policy. However, much better coordination is needed between federal agencies and state and local governments to ensure that these efforts can be consolidated and expanded so that border communities can be safe and prosperous. All too often, rigid insistence on national sovereignty has wasted potential opportunities and paralyzed bilateral cooperation. Over time, efforts should be made to make governance of the U.S.-Mexican border resemble that of the U.S.-Canadian border, where joint efforts to secure common objectives have often replaced unilateral thinking with significant benefits for both security and development of the border region. In the short-term, the possibility that the U.S. and Mexican governments

may pursue major infrastructure development initiatives in 2009 provides an opportunity to include funds for border infrastructure that can help overcome existing bottlenecks and stimulate development in border communities.

POE investment sufficient to solve– jumpstarts other improvements and happens immediately Accenture, 08 global management consulting, technology services and outsourcing company, report commissioned by the DOC (March, commissioned by the Department of Commerce's International Trade Administration, “IMPROVING ECONOMIC OUTCOMES BY REDUCING BORDER DELAYS FACILITATING THE VITAL FLOW OF COMMERCIAL TRAFFIC ACROSS THE U.S.-MEXICO BORDER”, http://shapleigh.org/system/reporting_document/file/487/DRAFT_Reducing_Border_Delays_Findings_and_Options_vFinal_03252008.pdf SW)

Improving Ports of Entry Stakeholders, both public and private, Federal, state, and local, and in the U.S. and Mexico,

must evaluate options and turn them into results. To jump-start improvement, options are tailored and aligned to POEs. These options may generate $7.5B and 34,000 jobs over the next

ten years by reducing border wait times. Action to improve border crossings can begin immediately.

Alt causes resolved nowWogan 8-31-12 J.B. is an intern with PolitiFact “Border is more secure, but not to everyone's satisfaction” http://www.politifact.com/truth-o-meter/promises/obameter/promise/286/secure-the-borders/

We also think it's worth noting that even though Obama's subject heading for the promise was "create secure borders,” his specific, measurable pledges were about investing in additional

staffing and resources. As we reported last year, personnel and other resources to stop

illegal crossings of the U.S.-Mexico border have increased dramatically in recent years. One vivid

statistic from Homeland Security: The number of border patrol officers more than doubled from about 10,000 to about 21,000 between 2004 and 2012. In our last update on this campaign promise, we warned that it's difficult to parse the effect of increased enforcement from the effect of changing economic conditions. Hanson, who has run statistical models to estimate factors that explain changes in illegal immigration, says the two biggest factors are enforcement and the economy, and they are equal in weight. In the case of the economy, the U.S. recession and the slowdown of home construction -- which employed many illegal immigrants -- is closely associated with less people trying to immigrate to the U.S. Without a clear-cut definition on what "secure borders” means, it's

difficult to grade Obama on his performance. Many signs point to significant progress on stemming illegal immigration, including added staff and resources in border security. But reports have indicated that a sizeable portion of the border is not under "operational control." We rate this promise a Compromise.

Plan leads to coordination with Mexico – spills overFigueroa et. al, 11 – Alejandro, Research and Policy Analyst, NACTS, with Erik Lee, Associate Director, NACTS, Rick Van Schoik, Director, NACTS (“Realizing the Full Value of Crossborder Trade with Mexico,” North American Center for Transborder Studies at ASU, 12/9/11, http://21stcenturyborder.files.wordpress.com/2011/12/realizing-the-value-of-crossborder-trade-with-mexico2.pdf)

Executive Summary The United States urgently needs a sustained national conversation regarding how to realize greater value in our crossborder trade with Mexico, and the benefits of increasing efficiencies at our shared border. As the export sector assumes more importance and the U.S. economy struggles to create high-quality jobs, our nation needs to discover every dollar of value in our relationship with our nation’s number two export market: Mexico. Trade with Mexico: An Abundance of Value That Is “Hidden In Plain Sight” Trade is an important tool in policymakers’ economic development toolbox. Ever since the enactment of the North American Free Trade Agreement (NAFTA), and given the complementarity of the U.S. and Mexican economies, bilateral trade has grown exponentially, reaching a record high of nearly $400 billion in 2010. Mexico is now the third-ranked commercial partner of the U.S. and the second largest market for U.S. exports. Mexico spent $163 billion on U.S. goods in 2010, and trade with Mexico sustains six million jobs in the U.S. This is economic value that for many in the U.S. remains “hidden in plain sight.” To provide a better idea of what this commercial partnership means to our country, U.S. sales to Mexico are larger than all U.S. exports to the BRIC countries (Brazil, Russia, India and China) combined, as well as all combined sales to Great Britain, France, Belgium and the Netherlands. Twenty-two states count Mexico as their No. 1 or No. 2 export market, and it is a top-five market for 14 other states. American consumers and businesses import large quantities of jointly produced products and services from Mexico such as automobiles, produce, and petroleum, just to name a few. Still, for every dollar Mexico makes from exporting to the U.S., it will in turn spend 50 cents on U.S. products or services, which are a considerable benefit to our economy and demonstrates the truly unique quality of this trade or “joint production” relationship. U.S.-Mexico Border Management: Building the Infrastructure for Future Competitiveness Sharing a 2,000-

mile long border with Mexico needs to be recognized as both a challenge and an opportunity. Though improving, our border’s current infrastructure and capacity today reflect the needs of a bygone era. While land ports of entry between the two nations were first envisioned to process the legitimate crossing of people, goods and services across the border, security has taking an overwhelmingly dominant role in recent years, hampering the ability of agencies to efficiently manage border traffic. With this in mind, in May of 2010 the U.S. and Mexico signed the 21st Century Border Management Joint Declaration. Recognizing the importance of fostering the

commercial relationship, both countries have agreed to coordinate efforts to enhance economic competitiveness by expediting lawful trade. The basic idea is that developing a

modern and secure border infrastructure will give an added boost to our region’s safety

and competitiveness in the world. Much Opportunity, but the Real Work Has Only Just Begun The poor infrastructure, the inadequate staffing levels and the heavy focus on security that prevails at the U.S. – Mexico border

have cost both economies billions of dollars in gross output annually. It is past time for our shared border to begin to meet today’s demands, acting as a facilitator and conductor of lawful flows of goods, services and people across our nations so that we may capitalize on the full potential of our partnership. If a billion dollars’ worth of trade crosses the U.S.-Mexico border on a daily basis now while sustaining six million jobs, imagine what could be accomplished with a truly 21st century border.

EXT - Cooperation KT BiodiversityThat’s key to the ecology of both countriesGanster ’03 -- Professor of History, Director of the Institute for Regional Studies of the Californias (Paul, “Environmental Issues of the California-Baja California Border Region”, online PDF//JC)

All of these ecosystems and their associated plant and animal species need to have

binational cooperation for conservation and protection to assure their longterm sustainability . Because of greater growth along the U.S. side of the border , there is often a greater presence of undisturbed habitats and ecosystems on the Mexican side . The San Diego region is attempting to protect key habitats through the Multi-Species Conservation Plan, which would protect vital corridors and would

maintain large enough habitat areas for survival of important species. Large areas of protected lands under control of various federal and state agencies are present along the border and some abut the international boundary. However, on the Mexico side of the border, protected areas are lacking. The last portion of the Colorado River Delta and Upper Gulf of California Biosphere Reserve is located in Sonora and is linked with the Organ Pipe Natural Monument and parts of the Cabeza Prieta Natural Wildlife Refuge in Arizona. On the peninsula itself, the only protected area located within the 100-kilometer border area is the Parque Nacional Constitución de 1857, located approximately 50 kilometer from the international boundary.

EXT - Limited Mandate Kills NADBankLimited mandate undermines NADBankReuters, 12 (“TEXT-S&P revises North American Development Bank outlook,” 7/18/12, http://www.reuters.com/article/2012/07/23/idUSWNA177320120723)

The negative outlook reflects rising embedded risks in NADB's loan portfolio. Rating Action On July 23, 2012, Standard & Poor's Ratings Services affirmed its 'AA+/A-1+' foreign currency issuer credit ratings on the North American Development Bank (NADB). At the same time, we revised the outlook to negative from stable. Rationale The ratings on NADB reflect its strong capital ratios and ample balance sheet

liquidity. Its business profile, however, is weaker than other multilateral lending institutions. The outlook revision to negative reflects our expectation that NADB's narrow lending mandate will continue to pose embedded risks to NADB's loan portfolio as it expands in the next few years. NADB was established by an intergovernmental agreement between the U.S. (AA+/Negative/A-1+; foreign currency sovereign ratings) and the United Mexican States (BBB/Stable/A-2; foreign currency sovereign ratings) in 1993, as an outcrop of the North American Free Trade Agreement. Its mission is to finance environmental infrastructure projects within 100 kilometers north and 300 kilometers south of the border between the two countries. These include the U.S. states of Arizona (AA-/Stable; global scale ratings), California (A-/Positive), New Mexico (AA+/Stable), and Texas (AA+/Stable). The Mexican states, which we rate according to the Mexican national (CaVal) rating scale, include Baja California (mxAA-/Stable), Chihuahua (not rated), Coahuila (mxBBB-/Negative), Nuevo Leon (mxA/Stable), Sonora (mxA/Negative), and Tamaulipas (mxAA/Negative). The majority of NADB's loans are typically less than $15 million, and although its loan portfolio is

growing, the bank retains a small market share relative to its sub-federal government borrowers' total debt financing. As of year-end Dec. 31, 2011, just under two-thirds of its $396 million international program loan exposure (net of foreign exchange adjustments) was to Mexican borrowers, principally public sector loans collateralized by federal government transfers and denominated in pesos. Standard & Poor's views the risks from the geographic proximity of NADB's obligors (a feature of its narrow lending mandate) and the use of Mexican federal government transfers to collateralize a significant share of the bank's loans to public-sector borrowers as highly correlated. We

expect that NADB's loan portfolio will remain highly concentrated and this characteristic will continue to constrain our ratings on NADB. In addition, NADB's non-accrual loans rose to 5% of total international loans at the end of 2011 from 2% the previous year, and the allowance for loan losses covered 40% of non-accrual international program loans at the end of 2011. NADB has a strong level of capitalization. As of Dec. 31, 2011, NADB's narrow risk-bearing capacity (shareholders' equity plus allowance for loan losses) covered 127% of its development-related exposure (DRE), which is comprised solely of loans. Although this ratio has steadily declined and we expect it to decline further--as NADB mobilizes its resources in order to execute its mandate--we believe that capitalization will remain a supporting factor of NADB's credit. The bank also has callable capital from its shareholders, but we place less weight on this feature of NADB's capital structure, particularly in light of the appropriation risk in the U.S. should a call be made. Given NADB's relatively small size (total assets of $828 million as of Dec. 31, 2011) and its strong capitalization, NADB is an infrequent issuer in the bond markets. Its balance sheet liquidity is strong, with liquid assets representing 43% of total assets at the end of 2011. These liquid assets are invested in securities of its two shareholders, as well as corporate and structured assets rated 'AA' or higher. NADB uses currency interest-rate swaps to transform its dollar-denominated debt and equity capital to peso-denominated loans for its Mexican borrowers. These

swaps create some volatility in NADB's comprehensive income. Outlook The outlook on the ratings is negative. Further increases in the embedded risk of NADB's portfolio or the deterioration of its loan portfolio performance could result in a downgrade. The bank's plan to increase its leverage will likely preclude an upgrade. Additionally, our revised multilateral lending institutions criteria, which we expect to have in place by the end of this year, could affect the ratings. Related Criteria And Research

NADbank solves infrastructure

Infrastructure investment through NADBank key to stimulate both economiesHS News 11 (Hispanically Speaking News, “Creating North American Development Bank Seen as Good Economic Opportunity for Border Economy,” Latin America Business News, 07/18/2011, http://www.hispanicallyspeakingnews.com/hispanic-business-news/details/creating-north-american-development-bank-seen-as-good-economic-opportunity-/8994/, AC)

Action to bring economic development to the US Mexico border is making its way through Congress by the expansion and enhancement of the NADBank.¶ The North American Development Bank (NADBank) was created out of the North American Free Trade Agreement (NAFTA) in 1993 to address environmental concerns that the members of Congress had and ensure precautions and measures were taken to have

environmentally sound region in the U.S.-Mexico border.¶ The introduction of the “NADBank Enhancement Act of 2011”, allows the two governments to work together to add more benefits along the border region such as infrastructure, transportation and Ports of Entry improvements. The proposed legislation would inject new criteria into the mandate and open the NADBank to finance new infrastructure projects. According to the text of the bill “(3) change the purposes and functions of the Bank, including

changes that would allow the Bank to finance infrastructure projects in the

border region that promote growth in trade and commerce between the United States and Mexico, support sustainable economic development, reduce poverty,

foster job creation, and promote social development in the region.’”¶ “We must continue our efforts to improve economic development and safety in the border areas of both the United States and

Mexico,” said Congressman Ruben Hinojosa from Texas.¶ This bill, which Congressman Rubén

Hinojosa and 19 co-sponsors introduced, is a bi-partisan and bi-national piece of

legislation that speaks to the healthy development along the U.S and Mexico border.¶ “Allowing the NADBank to develop and finance a broader range of infrastructure projects in the Mexico-US border region would further promote growth in

trade between the United States and Mexico, and to foster greater prosperity in the border region”, wrote Mexican Ambassador Arturo Sarukhan in a letter to Chairman Spencer

Bachus.¶ The NADBank is funded by both the Mexican and US government and the proposed

legislation would not increase the deficit or add to the national debt.

NADBank can fund access roads – that’s key to relieve congestion at the borderNegroponte 12 (Diana, Senior Fellow at the Brookings Institutions, “Viewpoints: What Should the Top Priority Be For U.S.-Mexican Relations?” 12/03/2012, http://www.as-coa.org/articles/viewpoints-what-should-top-priority-be-us-mexican-relations, AC)

Deepening the trade relationship and facilitating the shipment of component parts

between Mexico and the United States requires the creation of access roads some eight miles ahead of the principal border crossings. With electronic submission of customs/immigration documentation and with electronic seals on transnational containers, trucks filled with bilaterally

manufactured products can more rapidly pass across the border. Currently, the trucks are delayed principally for lack of access roads leading up to the border, especially on the Mexican side. ¶ In order to construct these roads, private-public partnerships are

needed. The NADBANK, established 20 years ago to support environmental projects, is the best placed to mobilize these partnerships. The bank's bylaws permit this. However, the environmental impact needs to be interpreted broadly. The Environmental

Protection Agency (EPA) could recognize that new roads relieve the

congestion and high levels of air pollutants at the border crossing itself. Use of access roads may spread pollution further inland, but the levels of pollutants will be

significantly lower than those currently suffered each side of the Rio Grande.¶ NADBANK’s initiative and the White House leadership to facilitate EPA approval could lead to the development of access roads and decongestion at the actual border. Mexican presidential encouragement to NADBANK's directors to seek PPPs and U.S. presidential

urging to the EPA for a broad interpretation of its mandate could result in a decade's work of new infrastructure projects. This will facilitate the anticipated tripling of cross-border trade as both countries negotiate a Trans-Pacific Partnership and Mexico negotiates a Pacific Trade Alliance with its South American partners. ¶ Presidential decisions to advance on instructing NADBANK to move forward with PPPs for these infrastructure projects are relatively easy. Their consequences will enhance the trade and prosperity of both nations.

NADBank key to effective implementation of infrastructure projectsFHWA 11 (Federal Highway Administration, United States Department of Transportation, “Greening Transportation at the Border,” February 2011, http://www.borderplanning.fhwa.dot.gov/greenborderrpt/green_border_final.pdf, AC)

A number of public agencies and institutionsNAD ¶ actively financing investment in transportation¶

infrastructure to address congestion and environmental issues in the U.S./Mexico border region. For ¶

example, the North American Development Bank ¶ (NADBANK), which was established in 1994

under ¶ the NAFTA, is supporting efforts in municipalities, such as Chihuahua, Mexico, to develop more ¶ sustainable transportation systems by investing ¶ in bus rapid transit systems. NADBANK’s mission ¶ is to enhance the

affordability, financing, long-term development, and effective operation of ¶ infrastructure that promotes a clean, healthy ¶ environment for the citizens of the region. ¶ Additionally, the BECC supports capacity ¶ expansion projects at ports of entry designed to ¶ reduce border-crossing times and improve air ¶ quality. The BECC is taking steps to finance the¶ modernization of existing bridges at Puerto Mexico ¶ to enhance the capacity of the border crossing to ¶ process vehicles. Regulatory reforms could allow ¶ bi-national debt financing instruments that would¶ enable sub-national governments to coordinate ¶ across the border to issue bonds for projects

¶ that address border issues. Socially responsible ¶ financial products could attract individual and¶ commercial investors to invest in environmental ¶

infrastructure projects.

NADBank Solves relations/Trade

Expanding NADBank solves trade, relations and boosts jobs and growthVillarreal 2012 (M. Angeles, specialist in international trade and finance, “NAFTA and the Mexican Economy,” Congressional Research Service, 06/03/2010, http://www.fas.org/sgp/crs/row/RL34733.pdf, AC)

Mexico’s economic relationship with the United States is of mutual importance to both Mexico ¶ and the United States. Economic studies on the effects on Mexico

and Mexican views of NAFTA ¶ could provide a valuable perspective when evaluating the possibility of reopening parts of the ¶ agreement or alternative policy options. Some observers have suggested that one of the lessons ¶ from NAFTA for developing countries is that they negotiate trade agreements in a way that would ¶ be more beneficial to them. This could take place by including provisions such as financial ¶ assistance from trading partners or new minimum wage requirements.62 Possible areas of ¶ consideration for U.S. and Mexican policymakers may include furthering economic integration ¶ between Mexico and the United States; enhancing or strengthening institutions created under ¶ 62 Audley, John J., Demetrios G. Papademetriou, Sandra Polaski, Scott Vaughan, Carnegie Endowment for ¶ International Peace, NAFTA’s Promise and Reality: Lessons from Mexico for the Hemisphere, 2004. NAFTA and the Mexican Economy ¶ Congressional Research Service 18 ¶ NAFTA side agreements; or taking other measures to help resolve the issues related to income ¶ disparity between Mexico and the United States. ¶ Some proponents of economic integration in North America have maintained that the emergence ¶ of China and India in the global marketplace may be putting North America at a competitive ¶ disadvantage with other countries and that NAFTA should go beyond a free trade agreement. ¶ Some observers have proposed that the U.S. government consider the possibility of forming a ¶ customs union or common market.63 However, critics of this level of economic integration ¶ believe that NAFTA has already gone too far and that it has harmed the U.S. and Mexican ¶ economies and undermined democratic control of domestic policy-making.64 If the United States ¶ were to potentially consider the further economic integration in North America, it would require ¶ cooperation by the governments of Mexico and Canada, and approval by the

U.S. Congress. ¶ Expanding NAFTA to a customs union or common market is not likely to happen within the ¶ foreseeable future. ¶ A possible option to address Mexico’s income disparities with the United States is to consider ¶ expanding the mandate of the North American Development Bank

(NADBank). NADBank and ¶ its sister institution, the Border Environment Cooperation Commission (BECC), were created ¶ under a bilateral side

agreement to NAFTA called the Border Environmental Cooperation ¶ Agreement. The objective of NADBank and BECC is to help U.S.-Mexico border communities ¶ plan and finance environmental infrastructure projects. Some Members of Congress and elected ¶ officials from Mexico have informally discussed the possibility of expanding the mission of the ¶ NADBank to go beyond environmental and border issues. One possibility would be to

expand ¶ NADBank projects to include transportation and other types of infrastructure projects. Another ¶ option would be to expand eligible projects to the entire region of Mexico instead of just the ¶ border area. Some policymakers have suggested the possibility of creating an infrastructure fund ¶ that would be managed by NADBank to provide investment in infrastructure, communications, or ¶ education.

NADBank key to Rail Modernization

NADBank key to trade facilitation through modernized railBalido 11 (Nelson, president of the Border Trade Alliance, “Encouraging Signs for Border Rail Industry, NADBank,” 07/01/2011, http://www.thebta.org/btanews/encouraging-signs-for-cross-border-rail-industry-nadbank.html, AC)

When we discuss cross-border trade transportation in North America, it’s usually the trucking industry that gets all the headlines.¶ With the U.S. and Mexico attempting to resolve a longstanding dispute over cross-border trucking, and with the trade community lobbying Washington to increase capacity at our land ports and to boost staffing to keep

the trucks moving, it’s easy to forget the important role that cross-border rail plays in NAFTA surface trade.¶ I had the opportunity last week to visit with stakeholders in Calexico, Calif. to discuss the issue of rail trade in Baja California and how it could enhance the entire region’s competitiveness. As the private and public sector representatives gathered around the table at the Calexico Chamber of Commerce heard, the stakes surrounding rail are high.¶ We heard from a major automaker that its ability to access rail near its assembly facility in Mexico and move cargo northbound will be a deciding factor in whether the company increases its investment in the region or looks elsewhere to expand operations.¶ But navigating the bureaucratic maze that is international rail is no easy task. There are lots of cooks in the kitchen, including federal and state governments and private sector concessionaires. And getting Mexican rail lines up to snuff to handle the volume from that country’s maquila sector is likely to come at a steep price. In the face of tight credit markets and a volatile economy, financing for rail line overhauls could prove to be out of reach.¶ We did, however,

receive some encouraging words from leaders at the North American Development Bank, who expressed their desire to engage in our rail infrastructure

discussions going forward.¶ Traditionally known for their work in environmental infrastructure, specifically in wastewater and solid waste management, the

NADBank is looking for ways to get involved in trade facilitation projects that also have an environmental component.¶ For example, the NADBank in 2010 financed its first land border port of entry, the San Luis II port linking San Luis, Ariz. and San Luis Rio Colorado, Sonora, where the new commercial port of entry helped improve air quality

by speeding the passage of truck traffic.¶ I believe there is a clear pro-environment case to be made for the NADBank getting involved in upgrading Mexico’s border region rail infrastructure. If modernized rail can help shift truck traffic away from overburdened land ports, then not only will trade efficiency be enhanced but air quality will improve as a result of fewer idling trucks waiting to enter the United States.¶ A critical element of North American

competitiveness is manufacturers’ ability to get their products to market efficiently and securely. If aging infrastructure is an impediment to businesses’ success, then

we’ll see companies start to migrate overseas, taking jobs with them as the NAFTA economy suffers.¶ The Border Trade Alliance is proud to have the rail industry represented in our membership. We’ll continue to be an advocate for the industry’s cross-border interests in the NAFTA marketplace. I’m excited for future discussions on upgrading our border region rail infrastructure as we work together to make the border region an attractive destination for investment.

NadBank Solves Air Pollution

NADBank infrastructure solves air pollutionFHWA 11 (Federal Highway Administration, “Greening Transportation at the Border,” U.S./Mexico Joint Working Committee on Transportation Planning, February 2011, http://www.borderplanning.fhwa.dot.gov/greenborderrpt/page05.asp, AC)

Several findings that reach across disciplines emerged from the presentations made during the Greening Transportation at the Border Workshop. From these findings, recommendations were culled from the discussion and sessions throughout the workshop that FHWA and its partners in Canada and Mexico could undertake to improve the environmental sustainability and livability along the border regions:¶

Finding: Emissions and particulate matter from vehicles crossing the borders have significant impacts on air quality and contribute to climate change. Recent research at major universities and through government agencies

suggests that older vehicles, unpaved roads, and freight operations at the border lead to a major decline in air quality at the border.¶

Recommendation: The U.S., Mexico, and Canada should seek ways to reduce emissions and particulate matter at the border through targeted programs and technology improvements. Potential technology innovations include:¶ Cleaner vehicles (USA): EPA's SmartWay Transport Partnership promotes a variety of green transportation technologies aimed at limiting the environmental impacts of freight transportation through vehicle retrofits to reduce fuel consumption.¶ Cleaner vehicles (Mexico): Mexico initiated Transporte Limpio (Clean Transportation) to reduce fuel consumption and emissions among long-haul freight carriers. Financial incentives have

encouraged private companies to participate in the program.¶ Develop program with NADBANK and others to fund projects to pave unpaved roads.¶ New alternatives to hot-mix asphalt and traditional concrete: The use of recycled asphalt pavement, recycled tires, and recycled asphalt shingles can reduce emissions before and during construction. The use of warm-mix asphalt further reduced emissions generated during production and installation. New varieties of concrete can reduce stormwater runoff and lower emissions during the production and installation of concrete.¶ Truck stop electrification: Truck drivers connect their vehicles to electric outlets to power the vehicle during layovers to reduce emissions from excess idling

AT: Mexico Politics DA

Mexican investment in construction non-uniques disads Conan 13(Rebecca Conan, Business News Americas, “Mexico's govt to invest US$23.1bn in infrastructure projects by year-end” June 21, 2013 http://www.bnamericas.com/content_syndication/extranet2/story.xsql?id_source=&id_noticia=620211&id_sector=5&Tx_idioma=I&id=987770, RLA) The Mexican government will invest 310bn pesos (US$23.1bn) in water,

infrastructure and energy projects by the end of the year, said President Enrique Peña Nieto during the national communications and transport meeting being held in Mérida, Yucatán state.

¶ The government has already invested 123bn pesos this year, but expects to invest the remaining 187bn pesos during the next six months.¶ Infrastructure projects scheduled for this year include a 1.4bn investment in construction of the 9bn-peso Oaxaca-Istmo highway and building of rural roads.¶ The president also called for completion of studies for the Yucatán peninsula passenger train project.¶ Peña

Nieto did not specify how much of the 310bn pesos would be channeled to the transport and communications ministry (SCT) but the ministry's budget was previously set at 86.2bn pesos for the year, said SCT minister Gerardo Ruiz.¶ Some 88% of the SCT's budget for the year has already been assigned

and spending is expected to reach 280mn pesos each day throughout July, said the minister.

1ac – Non NADBank versionGovernment action is key to stimulate the private sector –provides incentive and reduces redundanciesU.S. Chamber of Commerce, 11 (“Steps to a 21st Century U.S.-Mexico Border” http://www.uschamber.com/sites/default/files/reports/2011_us_mexico_report.pdf SW)

 We are encouraged by recent efforts by leadership at CBP to achieve our shared goal, but  funding is needed now to signal to the private sector that the government is serious about this system. Our goal in the next three years should be the retirement of the U.S. Automated Commercial System and the full use of ACE by the entire trade community. We should also strive to ensure the development and

implementation of the International Trade Data System (ITDS). Unfortunately, there has been little progress made due to the lack of coordination between government agencies to harmonize data submission into the system. To date, companies are required to enter

repetitive data to each government agency involved. Simplifying the   entry process   for

tradedecreases costs for businesses and provides governments with more accurate and accessible information .

Federal leadership is key to effective policy – only way to capitalize on relationsWilson Center, 09 (7“THE UNITED STATES AND MEXICO: Towards a Strategic Partnership,” Woodrow Wilson Center Mexico Institute, January 2009, http://www.wilsoncenter.org/sites/default/files/The%20U.S.%20and

%20Mexico.%20Towards%20a%20Strategic%20Partnership.pdf)Red

The Obama administration and the incoming Congress have the opportunity to raise the level of attention given to Mexico and to pursue a strategic partnership based on consultation and cooperation around issues of shared national interest. Too often in the past, the U.S. government has pursued unilateral solutions to problems that require binational cooperation. There is no lack of policies towards Mexico in the U.S. government. Since the issues in the relationship

with Mexico almost always have domestic as well as foreign policy aspects, every department and almost

every agency of the U.S. government has some dealings with Mexico or the U.S.-Mexico border, as

do a range of state and local government agencies. The challenge is, therefore, to find strategic ways of building synergies among these multiple, disjointed, and often competing efforts that tie into a broad agenda for collaboration with Mexico around clearly

defined objectives that are in the national security interests of both countries. A strategic partnership between the two countries will require both high-level foreign policy

attention in Washington and Mexico City and efforts to engage all government actors at the federal, state, and local level involved in key policy decisions. It will be important to strengthen existing structures for consultation but also to develop new ones that can promote and sustain effective dialogue and problem-solving. There are at least four areas that call out for priority attention in the relationship and will require sustained dialogue and engagement: security cooperation, economic integration, immigration, and border management. Strengthening Security Cooperation Mexico and the United States share vital national security interests in making sure that the border is not used by terrorist organizations intent upon committing acts of large-scale violence. !ey also share a joint concern with the rise of transnational organized crime. Criminal activity associated with drug trafficking poses an increasing threat to communities on both sides of the border. Mexico is the largest transshipment point for cocaine en route to the United States, and is the largest foreign supplier of methamphetamines, heroin, and marijuana. In turn, profits from drug sales in the United States pump roughly $15 to $25 billion every year into illicit activities in Mexico, while over 90% of the arms used by drug traffickers are imported from the United States. Violence from drug trafficking has become endemic, and it has gradually penetrated into the politics of some local, state, and even federal government agencies. Meanwhile, the drug trade fuels crime in neighborhoods throughout the United States and grows particularly threatening in the border area. Although there is no evidence to date of terrorists using the Mexican border for attacks on the United States, clearly the existence of an extensive infrastructure linked to organized crime raises concerns about possible future threats. Recent efforts between the two countries to strengthen intelligence sharing, technology transfer and training, including the bipartisan passage of the Mérida Initiative, have built a strong framework for future efforts at cooperation. Much more can be done to deepen these efforts, however, and a new administration should look for ways to forge a comprehensive approach against organized crime that combines (1) law enforcement cooperation, especially targeted efforts at disrupting money and arms supplies (2) strengthening police and judicial institutions in Mexico, and (3) reducing the demand for narcotics in the United States. !is would mark a major departure in U.S. drug control policy in the past but one that would have significantly more chances of success than previous efforts. Managing Economic Integration !e United States and Mexico have undergone an accelerated process of economic integration over the past two decades. Trade has tripled between 1990 and 2008, due in large part to the North American Free Trade Agreement (NAFTA). Mexico is now the United States’ third largest trading partner and the second destination of exports,

accounting for roughly one-eighth of all U.S. exports. Border states are particularly dependent on trade with Mexico, but so are states that are distant from the border such as Nebraska, Indiana, and Iowa. !e United States also depends on Mexico for more than one-tenth of its petroleum imports. Even the labor markets of the two countries have become increasingly intertwined, with immigrant workers from Mexico accounting for a significant part of U.S. labor market growth and contributing to the solvency of U.S. entitlement programs by providing new tax revenues. Despite these trends, not enough attention has been given to deepening economic integration beyond trade and investment. NAFTA did not attempt to stimulate the type of economic development needed to promote job creation and a more equitable income distribution. A forward-looking agenda should now address three basic concerns. First, it should seek to raise living standards and reduce income disparities. Narrowing the income gap between Mexico and its two NAFTA partners, in particular, would help curb Mexican migration to the United States. Second, it should reduce non-tariff barriers to trade (such as poor border infrastructures and complex differences in national standards) that have made it particularly difficult for small and medium businesses to become involved in crossborder business. !ird, it should acknowledge Mexico’s special vulnerability to economic turmoil in the United States and in global markets and seek to prevent an economic slowdown from turning into a full-blown crisis, with significant spillover effects for the U.S. economy. Addressing Immigration Migration is transforming the social fabric and economies of both the United States and Mexico. Today over 12 million Mexicans live in the United States, roughly half of them without legal documents. Roughly one-third of all U.S. immigrants come from Mexico, with about 300,000 new unauthorized immigrants arriving each year. While immigration produces net benefits to the U.S. economy as a whole, the rapid pace of immigration and the unauthorized status of so many immigrants pose specific challenges for integration, wage competition, and labor rights. And while Mexican migrants send roughly $23 billion back home in remittances, there is no question that the loss of so many of the country’s most entrepreneurial citizens represents a net loss for Mexico’s competitiveness. Most of the efforts needed to provide alternatives to migration and manage future flows will have to be taken unilaterally in one country or the other; however, the effects of measures taken in one country will have profound effects on the other. Strategic thinking between the two countries could provide incentives and opportunities to pursue the best policy options available. A permanent dialogue between the two countries on migration can help produce the best policies available, even though each country will need to pursue its own efforts to deal with particular policy reforms. Investing In Border Communities The border has become a microcosm of all the challenges that the two countries face in trying to deal with each other effectively. At the border bottlenecks caused by deficient infrastructure raise the cost of trade and limit cross-border ties; unilateral strategies for security play out against the need for cross-border cooperation in law enforcement; and the challenges of clean air and sufficient water remind people that natural resources know no political boundaries and require joint responsibility. U.S. border communities remain among the poorest in the United States, with average incomes a third less than in the rest of the country, and significant deficits in employment and infrastructure, despite the comparative advantages that border communities should have as international gateways. At

the same time, border communities have become laboratories of experimentation in

creative efforts at international cooperation. Most have developed binational mechanisms to manage resources, respond to natural disasters, ensure public security, and promote development, generally at the margins of

federal policy. However, much better coordination is needed between federal agencies and state and local governments to ensure that these efforts can be consolidated and expanded so that border communities can be safe and prosperous. All too often, rigid insistence on national sovereignty has wasted potential opportunities and paralyzed bilateral cooperation. Over time, efforts should be made to make governance of the U.S.-Mexican border resemble that of the U.S.-Canadian border, where joint efforts to secure common objectives have often replaced unilateral thinking with significant benefits for both security and development of the border region. In the short-term, the possibility that the U.S. and Mexican governments

may pursue major infrastructure development initiatives in 2009 provides an opportunity to include funds for border infrastructure that can help overcome existing bottlenecks and stimulate development in border communities.

POE investment sufficient to solve– jumpstarts other improvements and happens immediately Accenture, 08 global management consulting, technology services and outsourcing company, report commissioned by the DOC (March, commissioned by the Department of Commerce's International Trade Administration, “IMPROVING ECONOMIC OUTCOMES BY REDUCING BORDER DELAYS FACILITATING THE VITAL FLOW OF COMMERCIAL TRAFFIC ACROSS THE U.S.-MEXICO BORDER”, http://shapleigh.org/system/reporting_document/file/487/DRAFT_Reducing_Border_Delays_Findings_and_Options_vFinal_03252008.pdf SW)

Improving Ports of Entry Stakeholders, both public and private, Federal, state, and local, and in the U.S. and Mexico,

must evaluate options and turn them into results. To jump-start improvement, options are tailored and aligned to POEs. These options may generate $7.5B and 34,000 jobs over the next

ten years by reducing border wait times. Action to improve border crossings can begin immediately.

Alt causes resolved nowWogan 8-31-12 J.B. is an intern with PolitiFact “Border is more secure, but not to everyone's satisfaction” http://www.politifact.com/truth-o-meter/promises/obameter/promise/286/secure-the-borders/

We also think it's worth noting that even though Obama's subject heading for the promise was "create secure borders,” his specific, measurable pledges were about investing in additional staffing and resources. As we reported last year, personnel and other resources to stop

illegal crossings of the U.S.-Mexico border have increased dramatically in recent years. One vivid

statistic from Homeland Security: The number of border patrol officers more than doubled from about 10,000 to about 21,000 between 2004 and 2012. In our last update on this campaign promise, we warned that it's difficult to parse the effect of increased enforcement from the effect of changing economic conditions. Hanson, who has run statistical models to estimate factors that explain changes in illegal immigration, says the two biggest factors are enforcement and the economy, and they are equal in weight. In the case of the economy, the U.S. recession and the slowdown of home construction -- which employed many illegal immigrants -- is closely associated with less people trying to immigrate to the U.S. Without a clear-cut definition on what "secure borders” means, it's

difficult to grade Obama on his performance. Many signs point to significant progress on stemming illegal immigration, including added staff and resources in border security. But reports have indicated that a sizeable portion of the border is not under "operational control." We rate this promise a Compromise.

Plan leads to coordination with Mexico – spills overFigueroa et. al, 11 – Alejandro, Research and Policy Analyst, NACTS, with Erik Lee, Associate Director, NACTS, Rick Van Schoik, Director, NACTS (“Realizing the Full Value of Crossborder Trade with Mexico,” North American Center for Transborder Studies at ASU, 12/9/11,

http://21stcenturyborder.files.wordpress.com/2011/12/realizing-the-value-of-crossborder-trade-with-mexico2.pdf)Red

Executive Summary The United States urgently needs a sustained national conversation regarding how to realize greater value in our crossborder trade with Mexico, and the benefits of increasing efficiencies at our shared border. As the export sector assumes more importance and the U.S. economy struggles to create high-quality jobs, our nation needs to discover every dollar of value in our relationship with our nation’s number two export market: Mexico. Trade with Mexico: An Abundance of Value That Is “Hidden In Plain Sight” Trade is an important tool in policymakers’ economic development toolbox. Ever since the enactment of the North American Free Trade Agreement (NAFTA), and given the complementarity of the U.S. and Mexican economies, bilateral trade has grown exponentially, reaching a record high of nearly $400 billion in 2010. Mexico is now the third-ranked commercial partner of the U.S. and the second largest market for U.S. exports. Mexico spent $163 billion on U.S. goods in 2010, and trade with Mexico sustains six million jobs in the U.S. This is economic value that for many in the U.S. remains “hidden in plain sight.” To provide a better idea of what this commercial partnership means to our country, U.S. sales to Mexico are larger than all U.S. exports to the BRIC countries (Brazil, Russia, India and China) combined, as well as all combined sales to Great Britain, France, Belgium and the Netherlands. Twenty-two states count Mexico as their No. 1 or No. 2 export market, and it is a top-five market for 14 other states. American consumers and businesses import large quantities of jointly produced products and services from Mexico such as automobiles, produce, and petroleum, just to name a few. Still, for every dollar Mexico makes from exporting to the U.S., it will in turn spend 50 cents on U.S. products or services, which are a considerable benefit to our economy and demonstrates the truly unique quality of this trade or “joint production” relationship. U.S.-Mexico Border Management: Building the Infrastructure for Future Competitiveness Sharing a 2,000-

mile long border with Mexico needs to be recognized as both a challenge and an opportunity. Though improving, our border’s current infrastructure and capacity today reflect the needs of a bygone era. While land ports of entry between the two nations were first envisioned to process the legitimate crossing of people, goods and services across the border, security has taking an overwhelmingly dominant role in recent years, hampering the ability of agencies to efficiently manage border traffic. With this in mind, in May of 2010 the U.S. and Mexico signed the 21st Century Border Management Joint Declaration. Recognizing the importance of fostering the

commercial relationship, both countries have agreed to coordinate efforts to enhance economic competitiveness by expediting lawful trade. The basic idea is that developing a

modern and secure border infrastructure will give an added boost to our region’s safety

and competitiveness in the world. Much Opportunity, but the Real Work Has Only Just Begun The poor infrastructure, the inadequate staffing levels and the heavy focus on security that prevails at the U.S. – Mexico border

have cost both economies billions of dollars in gross output annually. It is past time for our shared border to begin to meet today’s demands, acting as a facilitator and conductor of lawful flows of goods, services and people across our nations so that we may capitalize on the full potential of our partnership. If a billion dollars’ worth of trade crosses the U.S.-Mexico border on a daily basis now while sustaining six million jobs,

imagine what could be accomplished with a truly 21st century border.

Certainty Key

Certainty key – without it, border delays and investment decline are inevitable U.S. Chamber of Commerce, 11 (“Steps to a 21st Century U.S.-Mexico Border”http://www.uschamber.com/sites/default/files/reports/2011_us_mexico_report.pdf )

Businesses rely on just-in-time inventory management and depend on predictability and speed in their supply chains.

Consequently, supply chains are critical to businesses’ underlying value, growth potential, and economic competitiveness. In many cases, before a product is completed, it may have crossed the border numerous times, necessitating a swift crossing process. An efficient supply chain is a lifeline for economic cooperation and mutual prosperity, and it contributes to our two countries’

competitive advantage. Unfortunately, supply chains often come to a halt due to border

delays, security concerns, and infrastructure constraints. These issues create an environment of uncertainty in the business community, and uncertainty is the enemy of investment, job creation, economic prosperity, and supply chain security. We need to address these issues together in order to grow our trade relationship. Solving these issues will take collaboration, and the solutions are both short and long term. The business community is finding that sometimes likely solutions to border congestion are not being tried or, once tried, implemented. Nevertheless, we are encouraged by a recent willingness by leadership at CBP to engage in pilots and test new innovative ways to approach the border. Industry recognizes the challenges that face regulators in reforming policy; however, more needs to be done.

USFG Key

It's a question of framework setting – the USFG is key to Mexico involvementU.S. Chamber of Commerce, 11 (“Steps to a 21st Century U.S.-Mexico Border”http://www.uschamber.com/sites/default/files/reports/2011_us_mexico_report.pdf )

With the end of these initiatives, there is a need to reestablish a framework for government-to-government interaction. It is critical that both governments provide the private sector and other stakeholders ample opportunities to engage public officials on border issues as they, too, can help provide

many of the necessary security solutions. The governments, working with the private sector, can stymie drug trafficking and frustrate other criminal activitie s on the border.

Government action is key to stimulate the private sector –provides incentive and reduces redundanciesU.S. Chamber of Commerce, 11 (“Steps to a 21st Century U.S.-Mexico Border”http://www.uschamber.com/sites/default/files/reports/2011_us_mexico_report.pdf )

We are encouraged by recent efforts by leadership at CBP to achieve our shared goal, but funding is needed now to signal to the private sector that the government is serious about this system. Our goal in the next three years should be the retirement of the U.S. Automated Commercial System and the full use of ACE by the entire

trade community. We should also strive to ensure the development and implementation of the International Trade Data System (ITDS). Unfortunately, there has been little progress made due to the lack of coordination between government agencies to harmonize data submission into the system. To

date, companies are required to enter repetitive data to each government agency involved. Simplifying the entry process for trade decreases costs for businesses and provides governments with more accurate and accessible information.

Multiple government agencies ensure bad coordination now – only federal effort solves and unites U.S. Chamber of Commerce, 11 (“Steps to a 21st Century U.S.-Mexico Border”

http://www.uschamber.com/sites/default/files/reports/2011_us_mexico_report.pdf )

Currently, for instance, some nine U.S. agencies have “hold authority” to stop goods moving through the supply chain. Not all of those agencies , though, have personnel at the location where the hold is executed.

Therefore, a product will be held until a representative from a particular agency has time to review and release the package. This slows the process for industry and places the product at a greater risk for tampering and/or theft. Intergovernmental processes should be synchronized. For example, if a U.S. government agency has hold authority, it should select one of two ways to execute that authority: The agency should have staff with the authority to resolve the hold at the port of entry during CBP processing times, or the agency should delegate the authority to CBP to resolve the hold. The private sector is constantly engaged in improving their supply chain capacity, making better intergovernmental coordination

essential. As an example, the U.S. Food and Drug Administration (FDA) and CBP have some interconnectivity in their computer systems. When FDA has not reviewed a shipment in its Oasis system to determine if it wants to hold the shipment or “may proceed,” the shipment is not released in the

CBP system pending FDA review. The review is often delayed due to hours of operation for FDA personnel or work fl ow management of electronic information waiting for release. Even though a majority of these shipments will be

approved, trucks often must wait in secondary inspection areas at ports of entry, using valuable dock space that could be devoted to inspections by agencies of jurisdiction, resulting in congestion at ports of entry and delays in crossing times. Coordination of hours of operation and better integration of IT systems could help eliminate commercial losses for importers. The U.S. Department of Agriculture (USDA) also plays a critical policymaking and inspection role regarding phytosanitary issues and quality for certain fresh produce. The Mexican Department of Agriculture

(SAGARPA) and USDA should collaborate to inspect and grade fresh produce destined for the United States. This would better utilize existing resources in both countries, reduce duplication of efforts, and streamline processes at ports of entry.

***Incomplete Advantages***

***Manufacturing***

Congestion at the border hampers manufacturing effectiveness in North American nationsUribe, 12 – freelance reporter prior to joining the Fronteras team. (Monica, “NAFTA's promise slowed by lack of border infrastructure” American Public Media Marketplace, 10/31/12, http://www.marketplace.org/topics/world/naftas-promise-slowed-lack-border-infrastructure)//AR

Infrastructure at the border also affects wait times. The biggest obstacle to updating the current ports of entry and building new ones is insufficient federal funding. It’s especially tough now when the country is recovering from an economic recession and Congress has failed to approve the a new budget.¶ Chris Wilson, who researches binational trade for the Woodrow Wilson Center in Washington D.C., says “Customs and Border Protection has identified a $6 billion deficit between where we are now and where we need to be to keep up with all the people and goods that are flowing across the border everyday."¶

There has been some progress. There’s a new commercial port of entry in Arizona and another under construction in west Texas. Other ports have added additional lanes and trusted traveler programs have helped speed up inspection times. But it’s not enough. In the past two years binational trade has grown by a record 23 percent. Without the

infrastructure to support that amount of trade both countries lose out.¶ “It cuts into the competitiveness of manufacturing in North America," Wilson says. "It means that we have less jobs, less trade, less exports and those are things that are really important right now to our economy.”¶ In an effort to speed things along, some binational business leaders have begun to invest in infrastructure themselves.¶ "The truth of the matter is we cannot afford to wait for the federal government to allocate federal dollars for these important projects,” says Ruben Barrales,

president of the San Diego Regional Chamber of Commerce.¶ One example of such a project is a privately funded non-commercial border crossing outside San Diego that's currently under construction. Once completed it will link travelers directly to the Tijuana airport. It’s success may help determine the future of other privately funded commercial projects currently in the works.

Border infrastructure is essential to the production of manufactured goodsBoske 95(Leigh B. Boske, Ph.D. Professor ofEconomics and Public Affairs Lyndon B. Johnson School ofPublic Affairs, "U.S.-Mexico Trade and Transportation: Corridors, Logistics Practices, and Multimodal Partnerships" 1995 http://www.utexas.edu/research/ctr/pdf_reports/PRP_113.pdf, RLA)

All modes of transportation move both maquiladora and traditional trade.¶ Maquiladora operations are manufacturing and assembling plants located in Mexico that¶ produce goods primarily with U.S. components. These goods are mostly intended for the¶ US. market and become US. imports. A large percentage of these goods consists of¶ automobiles, electrical components, and consumer products. Most maquiladora¶ operations

are located just south of the border, although an increasing number, with¶ government encouragement, have established operations in the interior of Mexico. By¶ contrast, traditional trade has more diverse

origins and destinations, is shipped throughout¶ Mexico, and tends to consist of components for Mexican manufacturers and goods sold to¶ the Mexican consumer.¶ In 1992, maquiladora operations in Mexico accounted for 41 percent of U.S.¶ exports to Mexico and 52 percent of US. imports from Mexico. By the end of the first¶ quarter of 1992, the number of maquiladora plants had risen to 2,117, and the number of¶ Mexicans employed had risen to 471,814. Over 90 percent of these plants are located¶ within the six northern Mexican border states: Baja California Norte has 932¶ maquiladora plants (44 percent of the nation's total), employing over 102,000 workers;¶ Chihuahua has 391 (18 percent), employing 164,482 workers; Coahuila has 129 (6¶ percent), employing 30,113; Nuevo Leon has 83 (4 percent), employing 15,881; Sonora has 158 (7.4 percept), employing 39,884; and, finally, Tamaulipas has 333 (19 percent),¶ . "

***Energy***

A bolstered Transportation infrastructure is key to energy cooperation – Solves Mexican EconomyWood, 13 - Director of the Mexico Institute at the Woodrow Wilson International Center for Scholars (Duncan, “Growing Potential for U.S.-Mexico Energy Cooperation,” Wilson Center Mexico Institute, January 2013, http://wilsoncenter.org/sites/default/files/wood_energy.pdf)//AR

Looking ahead to the next six years of interaction between governments of

Mexico and the United States, there is the potential for an enormously fruitful relationship in energy affairs. Much of this depends ontwo key factors, political will and the internal changes that are underway in Mexico’s energy sector. In the past, political sensitivities concerning U.S. involvement in the Mexican hydrocarbons industry have limited the extent of collaboration in the oil and gas sectors. This continues to be a cause for concern in any U.S.-based discussion (from either the public or private sectors) of Mexican energy policy and the potential for collaboration, but in recent years there has been a relaxation of sensitivity in this area. Partly in response to the perceived need for international assistance in resolving Mexico’s multiple energy challenges, and partly as a result of a productive bilateral

institutional relationship between federal energy agencies, there is now a greater potential for engagement than at any time in recent memory.¶ We can identify three main areas in which bilateral energy cooperation holds great promise in the shortto medium-term. First, given the importance of the theme for both countries, there is great potential in the

oil and gas industries. This lies in the prospects for investment, infrastructure and technical collaboration. ¶ Second, we can point to the electricity sector, where the creation of a more complete cross-border transmission network and

working towards the creation of a market for electric power at the regional level should be priorities for the two countries. Third, in the area of climate change policy, existing cooperation on renewable energies and the need for a strategic dialogue on the question of carbon-emissions policy are two issues can bring benefits for both partners.¶ Underlying all three of these areas are broader concerns about regional economic competitiveness and the consolidation of economic development in Mexico. The first of these concerns derives from the hugely important comparative advantage that the North American economic region has derived in recent years from low-cost energy, driven by the shale revolution. In order to maintain this comparative advantage, and to ensure that the integrated manufacturing production platform in all three countries benefits from the low-cost energy, the gains of recent years must be consolidated by fully developing Mexico’s energy resources. With regards to the second concern, economic development, a number of commentators, analysts and political

figures in Mexico have identified energy reform as a potential source for driving long-term economic growth and job creation, and the potential opportunities for foreign firms are considerable. While the United States cannot play an active role in driving the reform process, the implementation of any future reform will benefit from technical cooperation with the U.S. in areas such as pricing, regulation and industry best practices.

Investment in Infrastructure spurs economic growth, trade, energy security and cooperationSelee, 12 - The founding Director of the Wilson Center’s Mexico Institute from 2003-12 (Andrew, “A New Agenda With Mexico,” Wilson Center Mexico Institute,, November 2012, http://www.wilsoncenter.org/sites/default/files/a_new_agenda_with_mexico.pdf)//AR

Strengthening Economic ties and creating Jobs¶ In most trading relationships, the U.S. simply buys or

sells finished goods to another country. However, with its neighbors, Mexico and Canada, the U.S. actually co-manufactures products . Indeed, roughly 40 percent of all content in Mexican exports to the United States originates in the United States. The comparable figures with China, Brazil, and India are four, three, and two percent respectively. Only Canada, at 25 percent, is similar.¶ With the economies of North America deeply linked, growth in one country benefits the others, and lowering the transaction costs of goods crossing the common borders among these three countries helps put money in the pockets of both workers and consumers . Improving border ports of entry is critical to

achieving this and will require moderate investments in

infrastructure and staffing, as well as the use of new risk management techniques and the

expansion of pre-inspection and trusted shipper programs to speed up border crossing times. Trans- portation costs could be further lowered — and competitiveness further strengthened — by pursuing an Open Skies agreement and making permanent the

cross-border trucking pilot program. While these are generally seen as border issues, the ben-efits accrue to all U.S. states that depend on exports and joint manufacturing with Mexico , including Michigan, Ohio, Nebraska, Iowa, South Dakota, New

Hampshire, and Georgia, to name just a few. ¶ Mexico also has both abundant oil reserves and one of

the largest stocks of shale gas in the world. The country will probably pursue a major

energy reform over the next couple years that could spur oil and gas production , which has been declining over the past decade. If that happens , it is certain to

detonate a cycle of investment in the Mexican economy, could significantly

contribute to North American energy security, and may open a space

for North American discussions about deepened energy cooperation

***Answers to***

AT: Privitization CP

CP is literally impossibleHendricks, 12 (“Choked border crossings need this bill,” My San Antonio, 7/13/12, http://www.mysanantonio.com/business/business_columnists/david_hendricks/article/Choked-border-crossings-need-this-bill-3705492.php)

U.S.-Mexico trade has grown to more than $1 billion per day. Nothing will stop that growth faster than waiting lines at border crossings, especially since

nearly 85 percent of the trade is carried by freight trucks. The capacity to process trade at the border obviously needs to expand, and that means new lanes, bridges and government staffing. But guess what? The U.S. government is broke. Mexico, too, has no or little money to address the rising problem on its side

of the border crossing. Municipal and state governments, along with the San Antonio-based North American Development Bank, are willing to help pay for or finance new bridges, lanes and government agency staffing. The private sector is willing to invest, too, as long as it can recoup its investments in tolls. But guess what? The U.S. government agencies involved in border facilities and trade — the General Services Administration and Customs and Border

Protection — cannot accept any funding other than dollars appropriated by Congress. Hence, the introduction last month of the “Cross-Border Trade Enhancement Act of 2012” by U.S. Rep. Henry Cuellar, D-Laredo, U.S. Sen. John Cornyn, R-Texas, and other lawmakers. The bill would authorize GSA to evaluate border-crossing projects that would include funding and financing by non-federal government sources. “The days of free money are over,” said Nelson Balido, president of the San Antonio-based Border Trade Alliance, on Friday. Balido was referring to the days when the general public and businesses could rely on government to build and operate border crossings from their general budgets. Balido said border-crossing projects are stalled on U.S. borders with both

Mexico and Canada. One example is the Anzalduas International Bridge connecting McAllen/Mission with Reynosa, Mexico. The four-lane bridge opened in January 2010, Balido said, for

passenger cars and pedestrians, but area businesses and cities want to add freight trucks by 2015. That

would require at least a southbound inspection station. The Texas Department of Transportation is willing to help pay, Balido said, and the Rio Grande Valley municipalities want to assist, too. Private investors also are ready. The cities are willing to help pay government staff overtime so that high volumes of agricultural and manufactured goods, produced on seasonal basis, can cross on a timely basis. Customs and Border Protection, however, has said it cannot accept the financial help. The agency is not authorized to do so. “Today, there are no options,” Balido said. “By that I mean there is no (federal) money.”

Private corporations don’t have the jurisdiction – plan still has to go through the FG, also proves we solve bestDepartment of State, no date (“Presidential Permits for Border Crossings,” accessed 1/28, http://www.state.gov/p/wha/rt/permit/)Red

Under Executive Order 11423, as amended, the Secretary of State has the authority to receive applications for and to issue Presidential permits for the construction, connection, operation, or maintenance of certain facilities at the borders of the U nited States with Canada and Mexico. Permits are required for the full range of facilities at the border, including land crossings, bridges, pipelines, tunnels, conveyor belts, and tramways. This authority applies to all new border crossings and to all substantial modifications of existing crossings at the international border. Working with federal agencies such as the Department of Transportation, the General Services Administration, the Department of

Homeland Security's Bureau of Customs and Border Protection, and the Environmental Protection Agency, the

Department of State determines whether a proposed border-crossing project is in the U.S. national interest. The Department coordinates closely with concerned state and local agencies, and invites public comment in arriving at this determination. Within the context of appropriate border security, safety, health, and environmental requirements, the Department believes that it is generally in the national interest to facilitate the efficient movement of legitimate goods and travelers across U.S. borders.

Can’t stimulate private sectors – costs too highU.S. Chamber of Commerce, 11 (“Steps to a 21st Century U.S.-Mexico Border”http://www.uschamber.com/sites/default/files/reports/2011_us_mexico_report.pdf )

The private sector is eager to participate in Trusted Shipper Programs, such as Customs Trade Partnership against Terrorism (C-TPAT) and Importer Self-Assessment to improve the

security of its global supply chains. This is risk management in action. These

programs are costly for the private sector and benefi ts for participants must be enhanced, but they are a perfect example of how government and private sector motives can align for the betterment of national security

EVEN IF they get rid of all possible limits on the private sector –long process still means only the gov can sole – repealing doesn’t solve without massive border delaysU.S. Chamber of Commerce, 11 (“Steps to a 21st Century U.S.-Mexico Border”http://www.uschamber.com/sites/default/files/reports/2011_us_mexico_report.pdf )

Providing solutions for small and medium-size businesses is also

critical to solving problem areas at our ports. The Chamber is encouraged by the proposal from CBP to develop Centers of Expertise as it begins to explore riskbased, account-based management. However, the solution must include staff that focuses on small business issues. Too

often, small businesses get stuck in bureaucracy, while their products sit on hold for months. In the case of perishable commodities, the product must be destroyed, resulting in losses of $40,000 or more per truckload. This has a definitive impact on profitability and growth. Many of these cases can ultimately be solved by the simple click of a button by a government employee, but needless delays in processing costs these companies a significant portion of their yearly revenue.

Third-party assets can’t do itU.S. Chamber of Commerce, 11 (“Steps to a 21st Century U.S.-Mexico Border”http://www.uschamber.com/sites/default/files/reports/2011_us_mexico_report.pdf )

There are significant security benefits to participating in the C-TPAT program, and we, therefore, support expansion of C-TPAT for all participants in the supply chain.

The SAFE Port Act of 2006 (Public Law 109-447, enacted October 13, 2006) anticipated a C-TPAT program open to all that opted and were able to meet the criteria. The current criteria, however, eliminate all Third Party Logistics Providers (3PLs) that do not operate their own equipment

*Politics*

Plan Solves CIR

Plan creates momentum for immigration reform – reframes the debateSelee and Wilson, 12/3/12 – Andrew, vice president for programs at the Woodrow Wilson International Center for Scholars and a senior adviser for the Mexico Institute at the Wilson Center and Christopher, associate for the Mexico Institute at the Wilson Center (“Getting ready for a new era in U.S.-Mexico ties,” CNN.com, http://globalpublicsquare.blogs.cnn.com/2012/12/03/getting-ready-for-a-new-era-in-u-s-mexico-ties/)

U.S.-Mexico relations have been dominated for the past six years by efforts to address drug trafficking and organized crime-related violence. This was the right thing to do while

violence spiked in Mexico, but with a new administration in office after the swearing in of

President Enrique Peña Nieto over the weekend, the time has come to re-balance the bilateral relationship. Ties tend to have the same top three items on the agenda year after year and administration after administration: immigration; drugs and violence; and trade and economic relations. Drugs and violence have dominated in recent years, and cooperation in addressing the transnational flows of drugs, arms and illicit money, as well as support for Mexico’s efforts to strengthen public security, must continue. Although the gains are still tenuous and the situation fluid, violence in Mexico does appear to have begun to decline at a national level and major advances have been made in key border cities such as Tijuana and Ciudad Juarez. Immigration dominated the early 2000's as presidents Bush and Fox sought a bilateral deal on the topic, but it has since become clear that immigration reform is first and foremost a domestic political issue in the United States. The rate of unauthorized immigration from Mexico has now dropped to historically low levels – there are at least as many leaving as arriving – which should allow for a more rational and reasoned debate on this issue in the United States. However, not since the negotiation and

implementation of NAFTA in the 1990s have economic relations topped the bilateral agenda. Trade and jobs

should once again top the U.S. agenda with Mexico for three main reasons. First, the economy most likely will be the top issue in both the United States and Mexico for the next several years. Economic issues were clearly the top issue for voters in the recent U.S. presidential elections, and in Mexico they matched public

security as the top set of concerns. Second, by focusing on the creation of jobs and improving the competitiveness of manufacturers on both sides of the border, we can improve the tone of the relationship. We may even find that the stickier issues of security and migration become a little less intractable. Finally, the economic agenda between the two countries has the potential to yield tangible results, creating jobs and improving the competitive position of North America vis-a-vis Asia. For years, Mexico has oriented its economy toward the U.S. in hopes of harnessing the growth of the world’s most dynamic economy. Now, at a time when Mexico is growing around four percent a year – faster than the United States – Mexico can return the favor and provide a boost to the U.S. economy. Meanwhile, Mexico’s large and growing middle class has become an increasingly important market for U.S. products. As it turns out, U.S. and Mexican companies do not simply sell products to one another, they build products together, with parts zigzagging back and forth across the border as goods are manufactured. As a result, a product imported from Mexico is, on average, made of 40 percent U.S. parts and materials, meaning forty cents of every dollar spent of Mexican imports stays right here in the United States. Chinese products, in contrast, contain just four percent U.S. content. This also means the competitiveness of our two countries is closely linked, and improvements in productivity in one nation make a co-manufactured product cheaper and more competitive on the global market. That is to say, growth in Mexico or the

United States will boost exports from both countries: when it comes to manufacturing, we are in it together. To produce results, the U.S.-Mexico economic agenda needs substance, and there is

plenty to do. To start out, we must make the southwest border more efficient without sacrificing security. Today, long and unpredictable wait times act as a type of border tax, cutting away at manufacturers’ competitiveness a bit more each time they send goods across the border. Since we manufacture and export together, the United States should also join forces with Mexico and Canada in designing and implementing a global trade strategy. The first step is robust cooperation in the Trans-Pacific Partnership negotiations, but the end goal

must be to expand the agreement until countries like China and India feel they will lose out if they do not join in. The countries could also tackle ways of making customs procedures more efficient, ensuring regulatory

frameworks are compatible, and integrating our transportation and logistics networks to keep up with regional manufacturers, who have already integrated production. In the end, it is a matter of perspective. If Mexico is seen more as a business partner than a source of intractable problems, a whole range of policy options that were previously considered too risky to be tried will be within reach. If such a change in perception occurs, the results will speak for themselves.

Business Groups like Plan

Business groups love the planWilson, 13 – Christopher, associate with the Mexico Institute (“New Ideas for a New Era: Policy Options for the Next Stage in U.S.-Mexico Relations,” Wilson Center, January 2013, http://www.wilsoncenter.org/sites/default/files/new_ideas_us_mexico_relations.pdf)

Improving policy requires surmounting political opposition. Past advances in U.S.-Mexico economic relations such as the passage of NAFTA were won not only by the political leadership in both countries, but also by the coalition of business groups and other non-government actors. The business communities of

the United States and Mexico are natural allies for any effort to implement the type of

competitiveness enhancing policies described above, but the networks forged during the passage of NAFTA virtually disappeared. Efforts should be made to strengthen the networks of U.S. and Mexican businesses and civil society groups working to support a positive and productive U.S.-Mexico partnership.

Plan is BipartBorder trade is bipartGomez, 2/4/13 (Joey, “Cornyn’s bill to boost port infrastructure wins border support”, Rio Grande Guardian, http://www.riograndeguardian.com/rggnews_story.asp?story_no=25 SW)

“Our move now is, you have to have it sponsored in the House and Senate again, and you have to get it up through

Appropriations,” said Weisberg-Stewart. “Even though we are just starting off at base one, we are ten steps ahead because we had made it so far last session. We have a lot of positive thoughts that this will pass this legislative session, and most importantly this is a bipartisan piece of

legislation. You have Democrats and Republicans understanding the significance of improving our border crossings.”

NADBank Popular

NADBank popularVanderpool, 06 (Tim, “NADBank Blues Will border cleanup efforts be abandoned?,” Tucson Weekly, 4/16/06,

http://www.tucsonweekly.com/tucson/nadbank-blues/Content?oid=1083801)Red

Regardless, the bank's latest reprieve is due primarily to pressure from border-area leaders. In March, for example, eight congressional members, including Rep. Raul

Grijalva, dispatched a letter to Treasury Secretary John Snow expressing "strong support" for the NADBank. A similar missive was drafted by the Good Neighbor

Environmental Board, says Robert Varady. "The very fact that you have all these border congressmen and other institutions screaming that it shouldn't be done away with, that indicates something."

Popular with Border Congress People

Plan popular with border CongressmenTaj, 06 (Mitra, “Possible shutdown of NADBank worries some U.S. lawmakers,” Tucson Citizen, 3/16/06, http://tucsoncitizen.com/morgue2/2006/03/16/152961-possible-shutdown-of-nadbank-worries-some-u-s-

lawmakers/)Red

U.S. Rep. Raúl Grijalva, D-Ariz., and other border congressmen say they are concerned with reports that U.S. and Mexican officials have been “secretly meeting” to discuss dissolving a cross-border bank that has financed border cleanup projects. The NADBank’s single largest grant has been $59.5 million to the city of Nogales, Ariz., which is building an international wastewater treatment plant about 60 miles south of Tucson. “If we don’t make improvements, there will be vast quantities of raw sewage flowing down the Santa Cruz River,” said Hugh Holub, Nogales utility director. “The contaminants would flow up to Tucson if we don’t get started on repairs soon. It would be a huge regional problem.” Tucson is downstream from Nogales and water filters into the underground aquifer through the Santa Cruz. There is no indication that project is threatened, but pulling any such funding could be a problem for border counties. Those counties are already plagued by tuberculosis in far greater rates

than the nation as a whole, officials in border counties say. The bank, created in a side agreement during

negotiations for the North American Free Trade Agreement in 1993, was seen as a win for border politicians and environmental activists reluctant to supportNAFTA for fear it would further reduce the quality of life along the 2,100-mile-long U.S.-Mexico border. The bank, funded by the U.S. and Mexican governments, issues grants and makes loans to finance projects such as the Nogales plant, approved in December. The NADBank has approved $86.3 million for nine projects in Arizona. Eligible communities must be within 62 miles north or 186 miles south of the border. That includes the border regions of 10 U.S. and Mexican states and about 7.8 million people. Reforms to broaden the bank’s reach by making below-market-rate loans available to low-income communities are being made too slowly, eight congressmen said in a letter to U.S. Treasury Secretary John Snow March 3. The major Mexican newspaper Reforma reported Jan. 31 that Mexico’s finance minister, Francisco Gil Diaz, proposed withdrawing Mexico’s contributions to the bank. Treasury spokeswoman Brookly McLaughlin wouldn’t comment on the bank’s future except to say, “We’ve been and continue to be in discussions with our Mexican counterpart to assess the role of the bank and

consider its future.” The congressmen’s letter said it was “inexcusable” that the bank’s board had not met for more than two years. The letter said sluggishness has prevented the distribution of more than $80 million in below-market-

rate loans. In 2001-02, the Treasury Department advocated combining the NADBank with its sister institution, the Border Environment Cooperation Commission, which certifies infrastructure projects for NADBank approval. But an agreement between President Bush and Mexican President Vicente Fox reversed the Treasury Department’s efforts by removing restrictions to NADBank lending, such as the bank’s market-based interest rate and borrower categories. NADBank public affairs director Juan Antonio Flores said bank management is still urging its board of directors to approve additional reforms, such as removing arbitrary lending limits and relying instead on a borrower’s credit rating. “Today, we don’t believe these limits make sense if we’re lending to a credit-worthy client,” said Flores. Pima County Supervisor Sharon Bronson said the bank’s close-to-market interest rates are the main reason Pima County hasn’t taken advantage of NADBank’s loans. She praised the bank’s mission and grant program. “I don’t want to see the NADBank go away,” she said. “It needs to reform itself to be relevant to the communities it serves.” Those communities, Bronson said, are some of the poorest in the country, and need more affordable lending, not less. Holub said the only other institution to which the city could have turned would have been Congress, a historically unreliable funding source for projects along the border. “That’s why the NADBank was created in the first place. Environmental problems had become so enormous along the border,” Holub said, “and Congress was simply not meeting our needs.” Bronson said because environmental problems span both sides of the border, border solutions should also. “There has to be an international agency that works on making improvements on both sides of the border,” Bronson said. Flores said that although the NADBank is doing more to help border communities tackle environmental problems, the binational approach to solving binational problems has been a success so far. “We’ve brought to the board’s attention what we see to be current limitations and obstacles to further enhancing the quality of life in the border regions,” Flores said. “We’ve done that.”

For officials in border regions, improving the bank to make it more responsive to the environmental needs of border citizens would be a welcome move.

Plan unpopular

Plan is unpopular – bureaucracy causes backlashDallas Morning News July 2008 “EDITORIAL: NADBank deserves U.S. funding” ProQuest

Not everyone agrees about the merits of the North American Free Trade Agreement, but it's hard to argue that the North American Development Bank, created under NAFTA, hasn't brought overwhelmingly positive changes to the border region. NADBank's good work needs to continue, and that won't happen if Congress continues to whittle down its funding.¶ Before NAFTA, the border region was an environmental disaster zone. Mexican border towns dumped millions of gallons of raw sewage into area rivers. Tap water was undrinkable. Pollution and industrial waste abounded. It's better now, but much cleanup work remains to be done.¶ Through grants and low-interest loans, NADBank has sparked more than $1.4 billion in public infrastructure projects on both sides of the border. This is not sexy stuff. Much of it involves sewage-treatment plants, landfill sites, water projects and road work. NADBank officials estimate that such projects have halted the dumping of about 300

million gallons per day of sewage into the Rio Grande and other waterways.¶ Washington's skepticism about NADBank has grown in recent years, partly because the bank has been slow to disburse its funds. Bank officials say the backlog was caused by the two-year average lead time needed to study, plan and approve each project before it could be funded. Steps are under way to streamline its processes, bolster accountability and reduce backlogs.¶ As the fervor over NAFTA has died down, so has Capitol Hill's enthusiasm for funding NADBank. Initial U.S. appropriations of nearly $100 million a year have steadily been slashed since NAFTA took effect 14 years ago. The requested 2009 appropriation is only $10 million.¶ Texas Sens. Kay Bailey Hutchison and John Cornyn have been enthusiastic supporters of NADBank in the past. A renewed funding push by them and other border-state legislators would help ensure that the bank's important work stays on track in the future.

AT: Trade Off DA

Plan would not expand the original NADBank mandate – George Kourous (directs the IRC's BIOC program, Writer, Editor & Senior Program Associate at International

Relations Center (IRC)) October 2000 “The Great NADBank Debate” ProQuest

"Stretching" the Mandate vs. Revising It¶ Many environmentalists and analysts agree that because BECC and NADBank's original charter calls for the two bodies to focus on "water pollution, wastewater treatment, municipal solid waste management, and related matters," the current polemic is unnecessary. The term "related matters," the argument goes, gives the institutions the flexibility to find new types of projects to fund without initiating a full-blown expansion of their mandate or diluting their efforts.¶ "A lot of time--and above all, resources--are being wasted," says Octavio Chavez, an expert on the border environment who works with the Ciudad Juarez-based environmental NGO InfoMexus. "Much of what is being discussed here could easily be considered a given, something already included in the [BECC/NADBank mandate]. It just seems that some people feel the need to be overly puritanical and orthodox--and why not say it, bureaucratic--when the times require that we be pragmatic."¶ In a recent white paper on the NADBank proposal, the Texas Center for Policy

Studies (TCPS), which has long worked on issues related to BECC and NADBank, suggests that "[related] projects could include agricultural and municipal water conservation infrastructure, individual water and wastewater home installations, industrial hazardous waste projects, industrial air pollution and vehicle emission

reductions projects, and street paving and housing improvements that are tied to meeting codes in areas lacking basic environmental infrastructure."¶

AT: T Economic Engagement

Infrastructure investment is EEMinistry of Foreign Affairs of Japan, 10 – Foreign Relations agency for Japan (Ministry of Foreign Affairs of Japan, “Joint Statement Vision for Japan-India Strategic and Global Partnership in the Next Decade,” Government of Japan, 10/25/10, http://www.mofa.go.jp/region/asia-paci/india/pm1010/joint_st.html)//AR

They also supported the establishment of a Ministerial Level Economic Dialogue

between Japan and India to give strategic and long-term policy orientation to

their bilateral economic engagement, taking into account the regional and global context and

to coordinate economic issues of cross-cutting nature, including

infrastructure development and financing. They welcomed the launch of the '2 plus 2'

dialogue at Subcabinet / Senior Official level and the launch of a dialogue on Africa at the official level in 2010 as a reflection of wider policy consultation and coordination on foreign policy and security issues.The two Prime Ministers welcomed the successful conclusion of negotiations on a balanced and mutually beneficial Japan-India Comprehensive Economic Partnership Agreement (CEPA). They directed their relevant authorities to work towards early entry into force of CEPA and its smooth implementation.

They expressed optimism that Japan-India CEPA will deepen their

economic engagement, in terms of trade in goods and services, investment and cooperation and contribute to mutual prosperity. They hailed CEPA between these two leading economies of Asia as an important step forregional integration. They noted with satisfaction the recent growth in Japanese foreign direct investment (FDI) into India and hoped that CEPA and the Memorandum on Simplifying Visa Procedures, the latter signed today, will further facilitate the presence of Japanese businesspersons in India.

EE can facilitate the development of infrastructureState Department, No Date – Foreign Relations Department of the USA (United States State Department, “What is Total Economic Engagement?,” USFG, No Date http://2001-2009.state.gov/e/eeb/92986.htm)//AR

Total Economic Engagement seeks to integrate and coordinate all U.S. economic instruments and programs into our regional and country strategies. The Bureau

of Economic, Energy and Business Affairs’ (EEB) broad cross-section of economic disciplines, interagency contacts, and expertise in such areas as trade, finance, energy , development, transportation, and telecommunications help ensure this coordination.

EEB is actively involved in the entire range of international economic issues affecting America’s security and well-being. Our priorities extend

from securing reliable, sustainable energy supplies to increasing market access for U.S. goods and services. Protection of American interests, such as intellectual property rights, fair play in international business, and shutting down terrorist access to financial networks, is not only part of our work, it is the foundation on which our efforts rest.

AT: T USFG (NADBank)

US Congress has the authorization to unilaterally provide ‘general capital increases’ to MBD’sRebecca M. Nelson (Analyst in International Trade and Finance at the Congressional Research Service) April 2012 “Multilateral Development Banks:¶ Overview and Issues for Congress” http://www.fas.org/sgp/crs/row/R41170.pdf

The Role of Congress in the MDBs¶ • Funding: Congressional legislation is required for the United States to make¶ financial contributions to the MDBs. Appropriations for the concessional¶

windows occur regularly, but appropriations are far more infrequent for the nonconcessional¶

windows. Unusually, all the MDBs are in the process of increasing¶ the size of their non-concessional lending facilities. Congress authorized U.S.¶ contributions to the “general capital increases” of the non- concessional lending¶ windows in FY2011 for the AsDB and in FY2012 for the other MDBs. The¶ appropriations for these increases are expected to be spread out over a five- to¶ eight-year period, depending on the institution.¶ • Oversight: In addition to congressional hearings on the MDBs,

Congress¶ exercises oversight over U.S. participation in the MDBs through legislative¶ mandates. These mandates direct the U.S. Executive Directors to the MDBs to¶ advocate certain policies and how to vote on various issues at the MDBs.¶ Congress also issues reporting requirements for the Treasury Department on¶ issues related to MDB activities. Congress can also withhold funding for the¶ MDBs unless certain institutional reforms are met (“power of the purse”).

*MDB = Multilateral Development Bank

This allows congress to set policy prioritiesRebecca M. Nelson (Analyst in International Trade and Finance at the Congressional Research Service)¶ And Martin A. Weiss (Specialist in International Trade and Finance at the Congressional Research Service) March 14, 2011“Multilateral Development Banks: How the¶ United States Makes and Implements Policy” http://assets.opencrs.com/rpts/R41537_20110314.pdf

Authorizing legislation is managed by the House Financial Services Committee and Senate¶ Foreign

Relations Committee. The House and Senate Appropriations Subcommittees on State,¶ Foreign Operations, and Related Programs handle the appropriations. Since 1981, MDB¶ legislation has become law through the regular legislative

process only once. Usually it is enacted¶ as a rider to other legislation. Congress exercises its influence over MDB policy through its¶ control over authorizations and appropriations and through oversight. The authorizing committees¶ have included in MDB authorizing legislation many directives which affect the goal and

direction¶ of U.S. policy. Congress has also used its control over the funding process—its “power of the¶ purse” —to set priorities and encourage the Administration and MDBs to consider changes in their¶ policies or

procedures. Congress has used hearings and required reports to get information about¶ U.S. policy and the MDBs onto the public record and to draw the Treasury Department’s attention¶ to issues of

pressing concern. Since the Administration knows it must come to Congress for future¶ authorizations and MDB funding, the views expressed by Congress through hearings have often¶ had an impact on the focus and direction of U.S. policy regarding particular concerns.¶ *MDB = Multilateral Development Bank

Our interpretation would not justify money being invested abroad – the bank is in San AntonioNADBank News 2008 Vol. XII, Edition 14 http://www.nadb.org/pdfs/pastnadbnews/volume_12/14.pdf

In this edition:¶ The North American Development Bank (NADB), an international organization located in San Antonio, Texas, is issuing a request for a Consultant Engineer for the Technical Services Department.

The US can unilaterally appropriate funds for Bilateral development banksMartin Weiss (Specialist in International Trade and Finance at the Congressional Research Service) January 2012 “Multilateral Development Banks: ¶ General Capital Increases” Multilateral Development Banks: ¶

General Capital Increases

An across-the-board increase in all members’ shares of MDB capital, increasing the amount the MDB can lend through its non-concessional window, is called a general capital increase (GCI). This funding is not to be used to directly increase concessional financial assistance to low-income countries, but rather to increase the capital base of the non-concessional window, allowing the MDB to increase its borrowings on the international capital markets and thus increase the size of its lending operations to market-eligible countries. ¶ While Congress appropriates funds annually to help fund the MDBs’ concessional lending ¶ facilities , capital increases of the main lending windows are rare. U.S. participation in MDB ¶ capital increases is especially important, as the United States is the largest shareholder in the ¶ MDBs and U.S. funding commitments often spur additional contributions from other member ¶ countries. The Center for Global Development estimates that every $1 the United States ¶ contributes to the World Bank as part of a GCI enables at least $30 in new World Bank lending ¶ and $70 in new AfDB lending.6

Biltilateral Development Bank funds are not all lumped into one sum – they can unconditionally invested in the bank but only conditionally used for certain circumstancesJonathan E. Sanford (Specialist in International Trade and Finance at the Congressional Research Service) January 2011 “Multilateral Development Banks:¶ U.S. Contributions FY2000-FY2011”

The MDBs’ concessional aid programs are funded with money donated by their wealthier ¶ member country governments . Loans from the MDBs’ market-rate loan facilities are funded with¶ money borrowed in world capital markets. The IFC and IIC fund their loans and equity¶

investments partly with money contributed by their members and partly with funds borrowed¶ from commercial capital markets. The MDBs’ borrowings are backed by the subscription s of¶ their member countries. They provide a small part of their capital subscriptions (3% to 5% of the¶ total for most MDBs) in the form of paid-in capital. The rest they subscribe as callable capital.¶ Callable capital is a contingent liability, payable only if an MDB becomes bankrupt and lacks ¶ sufficient funds to repay its own creditors. It cannot be called to provide the banks with additional¶ loan funds.¶ Countries’ voting shares are determined mainly by the size of their contributions. The United ¶ States is the largest stockholder in most MDBs. Japan has provided more to the AsDF and AfDF,¶ while Nigeria and Egypt have subscribed larger shares in the AfDB. Periodically, as the stock of ¶ uncommitted MDB funds begins to run low, the major donors negotiate a new funding plan that ¶ specifies their new contribution shares.

NADBank is bilaterralNADBank updatedNADB and its sister institution, the Border Environment Cooperation Commission (BECC), were created by the governments of the United States and Mexico in a joint effort to preserve and enhance environmental conditions and the quality of life of people living along the U.S.-Mexico border.