Guest Columnist

USMCA's trucking provision boosts Iowa's economy

Drivers are tested at the National American Driver Training Academy in Cedar Rapids on Thursday, June 14, 2018. Students from around the country learn to drive at the school before being hired to drive for Cedar Rapids-based CRST. (Rebecca F. Miller/The Gazette)
Drivers are tested at the National American Driver Training Academy in Cedar Rapids on Thursday, June 14, 2018. Students from around the country learn to drive at the school before being hired to drive for Cedar Rapids-based CRST. (Rebecca F. Miller/The Gazette)

Trucking is free trade in motion. From our vantage point behind the wheel, we see the importance of trade every day because our customers benefit from it.

From factories and farms, we deliver imports from all corners of the globe to stores and doorsteps across the country. Trucks are also essential to exporting, especially in Iowa, which is home to many Fortune 1000 exporters including Pella, HNI Corp, and Rockwell Collins. Our state delivers a diverse array of global goods from machinery to farming crops to chemical products —$14.3 billion of Made-in-America goods in 2018 alone, according to the United States Trade Representative.

Healthy trade means a healthy economy. While many Iowans may be concerned about the recent trade war with China and its impact on U.S. farms and factories, we can’t lose focus on the fact that Canada and Mexico purchase more U.S.-made goods than our next 10 trading partners combined. Every day, there are 33,000 truck entries along our northern and southern borders hauling more than $2 billion of goods. Since the North American Free Trade Agreement (NAFTA) was enacted, trade between our three countries has grown significantly. Since 1995, the value of goods moved by truck across the border has grown 191 percent and totaled more than $772 billion. We need open access to reach these valuable customers in our two largest export markets.

The economic ripple effect of free trade hits home in Iowa. Seventy-five percent of Iowa’s communities depend exclusively on trucks to deliver their goods and 73 percent of manufactured tonnage is transported in our state by trucks — that’s almost 285,000 tons per day. Our state’s trucking industry is home to 98,540 trucking industry jobs, which translates to one in 13 people in the state who receive a paycheck from the trucking industry.

Despite all of this success, NAFTA is showing its age and needs a refresh, particularly in today’s digital economy. The new and modernized United States-Mexico-Canada Agreement (USMCA) will build on the success of the previous trade agreement, while at the same time preserve the important components that have worked for nearly three decades.

Critical to the success of the USMCA is continuing the provisions that allow trucks from the U.S. and Mexico to deliver to destinations beyond the commercial zone at the border. It is important for our relationship with Mexico, border efficiency, and U.S. economic benefits that this program be maintained.

Unfortunately, there are some who favor tightening or eliminating these provisions and are using a number of disingenuous claims to argue in favor of closing our border. To be clear, carriers from Mexico do not take business and jobs away from American drivers as they cannot haul freight between destinations within the U.S. Mexican trucks are also safe and go through a rigorous inspection process. Keeping the border open is paramount to making commerce between our two countries easier and more efficient. Any attempt to tighten restrictions on trucks, and the movement of goods at our borders would be a devastating blow to the USMCA and Congress should reject it.

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When trade flourishes, Iowa flourishes. We need economic certainty during these tenuous times in global commerce. Ensuring a good and healthy relationship with close trading partners like Mexico and Canada is critical to our economy. When the trucking industry is efficiently and effectively moving cross-border freight, Iowa’s suppliers, shippers, retailers, and consumers reap the benefits, and the wheels of a robust economy and job market keep moving.

John Smith of Cedar Rapids is chairman of the board of Admiralty Holdings, Inc., and is an officer of the Iowa Motor Truck Association.

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