The Mexican trucking industry has repeatedly failed to get its own carriers to participate in a cross-border pilot program created in 2011 to study whether Mexican truckers are meeting basic safety standards set up in the wake of NAFTA. But instead of working harder to do so, the industry is going after the U.S. government.
Mexico's Canacar transport association is seeking $30 billion as part of an outrageous arbitration action the group updated this month. It alleges the amount is compensation for America not fully opening its southern border to some 30,000 Mexican truckers. This, despite the fact that less than a third of the recommended number of Mexican trucking companies are participating in the trial as outlined in a recent Department of Transportation (DOT) audit report.
The suit would be laughable if the financial consequences weren't so grave. As it stands, only 14 Mexican carriers are participating in the three-year program, which is due to expire in October. Another 17 truck companies have been dismissed or withdrew from the pilot. The DOT Inspector General suggested that 46 carriers at a minimum should be enrolled to obtain the needed statistical data to determine the safety of MX trucks and drivers operating in the United States.
There have been repeated problems with Mexican trucks not meeting environmental standards. And there have also been issues with participants meeting the English language proficiency standards as well having mechanisms in place to catch those who violate their operating authority by driving beyond the commercial zones even though they are not participating in the pilot. Even worse, the program to prevent MX truckers from violating U.S. cabotage laws, and stealing work from U.S. drivers, by making deliveries between two points in the U.S. hasn't been implemented.
It is not like the Mexican trucking industry hasn't already received some favorable treatment from U.S. authorities. The Teamsters have taken issue with the U.S. Federal Motor Carrier Safety Administration, saying that it is being too lax in allowing unsafe trucks from south of the border into the U.S. in an effort to boost participants in the pilot program.
The pilot program was approved by the American and Mexican governments in March 2011 to halt some $2.4 billion in tariffs on U.S. products. Now the Mexican trucking industry is upping the ante and saying that isn't good enough. The updating of this bogus multi-billion dollar appeal, however, doesn't change the fact Canacar hasn't proven that its members' trucks can meet basic U.S. safety standards that the U.S. is permitted to enforce under NAFTA.
And speaking of NAFTA, this latest arbitration action is another example of why this trade deal is an abject failure for the U.S. The fact that this meritless case can even be filed before an international tribunal shows the damage NAFTA brings. Why can private industry seek to intervene in an agreement reached between two sovereign nations? Not only that, but seek a preposterous $30 billion in damages!
As leaders from the U.S., Mexico and Canada met last week, the Trans-Pacific Partnership (TPP) was on the agenda, and top authorities from all three nations seemed to be advocating for it. But litigation like that filed by Canacar shows what the U.S. and other nations could be in for if it continues down the path of approval for the TPP.
This is not the time for America to be signing off on new trade deals that could worsen the problem. The appeal made by Mexican truckers will only be a drop in the bucket of what is to come if this 12-nation Pacific Rim trade deal comes to fruition.