The combination of expanded trade and investment
meant that the three countries were actually making
products together rather than just trading them. By
combining U.S. capital and technology with Mexico’s
cheaper labor and Canada’s abundant resources, the enlarged North American market experienced rapid growth,
while Europe stagnated. From the onset of the U.S.-Cana-dian Free Trade Agreement in 1988 to 2001, trade among
Mexico, Canada and the U.S., as a percentage of their
trade with the world, leapt from 36 percent to 46 percent.
The decline of the integration idea could be dated to
the spring of 2001, when Presidents Vicente Fox of Mexico and George W. Bush of the U.S. met Canadian Prime
Minister Jean Chrétien in Québec. Fox and his Foreign
Minister Jorge Castañeda arrived with a suitcase filled
with proposals, such as a North American Commission,
a “cohesion” fund to reduce the development gap, a customs union and an immigration agreement.
But Chrétien was not interested in including Mexico
in Canada’s talks with the U.S., and Bush rejected any
new multilateral institution or fund. The opportunity
for progress was lost.
WHY NAFTA FAILED TO LAUNCH
The decline of North American integration over the past
decade has shown that the agreement failed to adapt to
a changing regional and international context. Without
sustained commitment from national leaders, active cooperation inevitably lost out to stagnation.
Due in part to the rise of China and Europe as commercial powerhouses, North America’s share of the
world gross product declined from 36 percent in the
REINVIGORATING NORTH AMERICA—
A VISION AND A BLUEPRINT
The way to revive North America is to begin with the North American
Idea: the idea that our countries can only advance their shared interests
—whether it be global competitiveness or border security—within a new
cooperative framework.
Together with the President of Mexico and the Prime Minister of Canada, President Obama should mobilize the public on behalf of a grand vision of a continental future. That won’t be easy, and it cannot be done
one reform and one country at a time.
Pursue comprehensive
immigration reform.
We must negotiate comprehensive
immigration reform that would di-
minish undocumented migration,
open new channels of labor-based
migration, and create realistic paths
to citizenship for those who have
been abroad for many years. To de-
ter undocumented labor in the short-
term, major employers would be
required to use biometric identifica-
tion of their employees in the work
place. In the long term, Canada and
the U.S. must work with Mexico to
make targeted investments that cre-
ate jobs and fortify Mexico’s econ-
omy, thereby lowering the incentives
of northward migration.
goes beyond migration. The potential
for genuine political and economic
partnership remains limited
while the economic imbalance
among NAF TA members persists.
Substantial funds are needed
to construct the highways and
communication infrastructure that
would connect the south of Mexico
to its northern markets, increasing
the country’s competitiveness. But
the U.S. and Canada are unlikely to
contribute funding unless Mexico
undertakes fiscal, energy and labor
reforms. The three governments
must decide how to go about
narrowing Mexico’s development gap
in a way that benefits all interested
parties.
Close the development gap.
The development gap between
Mexico and its wealthier neighbors
Improve border regulations.
The three departments that
administer homeland security must
develop a single “North American
pass” to replace numerous,
costly forms of ID. Doing so would
enhance border security, facilitate
