Despite our robust domestic economy, the US economy depends on imports and exports, and exports to Canada and Mexico rank 1st and 2nd in US goods exports. That means the US sends hard goods to Canada and Mexico - like cars, machinery, electronics and food products - not software or financial products. Often these goods are shipped back to the US for final production - or vice versa. The natural market for the United States goods sector is its borders and while NAFTA strengthened trade relationships between the US, Canada and Mexico it is impossible to deny the geographical economic advantage North America has with itself. Despite the hard facts and the physical location of Canada - USA - Mexico, the current administrations NAFTA threats are centered around an idealistic “a la cart” style renegotiation for American interests which in the long run could damage US industries verses strengthening them.
Information from the “Office of the United States Trade Representative” below lists the official statistics from the US - Canada - Mexico free trade relationship:
What is Exported to Canada and Mexico?
U.S. exports to Canada and Mexico are similar outside of agricultural products, both countries import vehicles, plastics and machinery from the US.
Exports
Canada was the United States' 1st largest goods export market in 2016. U.S. goods exports to Canada in 2016 were $266.0 billion, down 5.2% ($14.6 billion) from 2015 but up 15.3% from 2006. U.S. exports to Canada are up 165% from 1993 (pre-NAFTA). U.S. exports to Canada account for 18.3% of overall U.S. exports in 2015.
Trade Balance
The U.S. goods trade deficit with Canada was $12.1 billion in 2016, a 22.1% decrease ($3.4 billion) over 2015. The United States has a services trade surplus of an estimated $25 billion with Canada in 2016, down 10.4% from 2015. - Sources: US Trade Representative
War on imports like the continued fight on Canada with newly leveled tariffs speak against the US economy. Retaliation against China subsidized steel is one thing but across the US and Canada lumber companies often work on both sides of the border. The US has relied on the Canadian lumber supply - the US is Canada’s largest market for softwoods, a major sector of lumber used for home building - to supplement the housing sector, which is essential to small businesses and America’s regional economies. Residential housing contributes between 10-18% to America’s GDP from residential investment and construction, and ancillary services like rent, utilities, remodeling and brokerage fees. According to CNN Money: The tariffs ranged from 3% to 24% on five specific Canadian lumber companies. For all other Canadian lumber companies, there's a nearly 20% tariff on exports to the US.
But arguments against NAFTA persist despite the twenty years of gigantic trade accounts. In reality the doom and gloom messaging undermines US interests. The economies of North America have been ever intertwined since January 1, 1994, when NFATA took affect. Fighting for higher wages for US workers when US auto manufacturing employees make ten times the amount of Mexico counterparts is a race we cannot win.