I am here today to speak on behalf of governors. The governors
of this country -- Republicans and Democrats alike --
overwhelmingly support the North American Free Trade Agreement --
forty out of fifty in a poll done by The Heritage Foundation.
Why? Because the NAFTA is good for state economies. And strong
state economies will mean a strong United States economy.
Midwestern governors support the NAFTA because it is good for
our diverse economies -- economies that rely on manufacturing,
agriculture, services, and technology.
As governor of the state of Wisconsin, my number one priority is
to keep our economy strong and growing. A strong economy means
jobs, and good jobs mean a state is healthy, stable, and
growing.
I am also here to speak for workers and consumers in Wisconsin
who stand to benefit from free trade with Mexico. Joining me today
are Rick Spees from Johnson Controls, Carlos Rioja from Oshkosh
Truck, Jim Leonhart from AT&T Wisconsin, Mark Yunker from
Yunker Plastics in Lake Geneva, and Steve Lotharius from Graeber
Industries in Middleton.
I support the NAFTA because the NAFTA means more jobs for
Wisconsin. The NAFTA means more jobs for the Midwest, and the NAFTA
the means more jobs for the entire United States.
I speak from experience.
Wisconsin's economy is strong. We have outpaced the nation for
years now, and international trade has played a very important role
in that.
Last year Wisconsin set a record, exporting almost $7 billion
worth of goods around the world. That was a 13.4 percent increase,
more than twice the national increase of 6.1 percent. And when you
think about the fact that every $1 billion in trade translates into
22,000 jobs at home, $7 billion in trade has a huge impact on
Wisconsin's economy.
Our exports for the first quarter of 1993 were up 6.4 percent
compared to a national increase of 2.7 percent.
Total exports during the first quarter were $1.67 billion
compared to $1.57 billion the year before.
And we saw a big increase in exports to Canada and Mexico.
Exports to Canada were up 16 percent to $599 million for the
quarter, and exports to Mexico -- afterI led a December trade
mission down there -- were up 26 percent to $75 million.
Taken together, the economic impact of trade with Canada and
Mexico in Wisconsin is considerable.
Wisconsin exports to Mexico totaled $250 million in 1992.
Exports to Canada totaled $2.05 billion.
Canada is our number one export market. Mexico is our seventh
largest market, and growing.
Together, exports to Canada and Mexico translate into almost
60,000 jobs in Wisconsin. And these export-related jobs are good
jobs -- among the highest paying jobs in the state.
Knocking down trade barriers works. We know because Wisconsin
has already benefitted from the U.S.-Canada Free Trade Agreement.
Since 1987 -- when that agreement was implemented -- Wisconsin
exports to Canada have increased from $1.4 billion to over $2
billion -- a 43 percent increase.
Exports to Mexico have also grown over the past few years --
from $83 million in 1988 to $250 million last year. That's more
than a 200 percent increase. In one year alone, exports to Mexico
jumped 83 percent!
The NAFTA will only increase investment and job opportunities in
Wisconsin. What governor wouldn't support something like that?
Our export market to Canada -- as I have already stated -- is
very strong, and we are continually working to make it even
stronger. Where Wisconsin stands to make the most from the NAFTA is
from increased trade opportunities from Mexico. That's why I have
led two trade missions to Mexico: one in 1989 and another last
December. In the five short days of the last mission, Wisconsin
companies were able to lay the groundwork for promising business
deals in everything from milking and farm equipment to Christmas
trees.
In fact, a recent survey of some of those found that they plan
to do $45 million to $55 million of new business in Mexico this
calendar year, and that's a very conservative estimate.
You know, the most often used argument against the NAFTA is a
myth.
The NAFTA will not mean losing American jobs to Mexico. Labor
down there is already cheaper than it is here at home, and there is
absolutely nothing now that prevents U.S. companies from moving to
Mexico. Businesses can go anywhere in the world today for cheap
labor, but they don't. If labor costs were all that mattered,
businesses would be relocating to Haiti and Bangladesh. The NAFTA
is not about moving jobs. The NAFTA is about removing tariffs and
trade barriers.
Right now, Mexican trade barriers add about 10 percent to the
cost of doing business in Wisconsin and the Midwest. Midwestern
companies that export to Mexico face higher costs because of
restrictions against our exports to Mexico.
The NAFTA will remove the incentive for businesses to move to
Mexico in order to avoid Mexican duties. Removing those barriers
will automatically reduce the cost of exporting to Mexico. Removing
those barriers will increase exports to Mexico. Removing those
barriers will create jobs in the U.S. and removing those barriers
will mean a stronger U.S. economy.
U.S. products are in demand down in Mexico. And the workers with
the skills and training to make those products are here at home,
not south of the border.
The NAFTA also gives U.S. companies a competitive advantage. It
eliminates Mexican tariffs for American companies, but leaves them
in place for our European and Asian competitors.
Reduction of trade barriers under the NAFTA will greatly benefit
Wisconsin's leading export industries.
The NAFTA will eliminate tariffs for industrial machinery and
computers on the day it is enacted. These industries exported $106
million to Mexico last year.
The NAFTA will eliminate import licenses and tariffs as high as
20 percent in scientific and measuring instruments, which saw $23
million in 1992 exports to Mexico.
Tariffs will be immediately reduced 10 percent to 20 percent on
food products -- good news for Midwestern farmers.
The same is true for electronic equipment, paper products, and
transportation equipment. All of these industries stand to gain
from the NAFTA.
And look what the NAFTA will mean to the Wisconsin companies who
are here with me today:
Oshkosh Truck accompanied me on my 1989 trade mission to Mexico
and were able to secure a contract worth approximately $1.2
million. They also recently have completed a joint venture in
Mexico. Think of the opportunities they could take advantage of
without trade barriers between our two countries.
Graeber Industries has seen sales of its window coverings and
other products to Mexico double in the last year. The year before
that sales quadrupled! The NAFTA would mean Graeber could be even
more competitive with their European and Asian competitors in the
Mexican marketplace.
Johnson Controls is Wisconsin's largest public corporation. It
manufactures building controls, automotive seating, batteries, and
plastic bottles -- all products that are in great demand in Mexico.
It has in fact just purchased a Mexican company in anticipation of
the NAFTA being approved.
There is great demand and great need in Mexico for
telecommunications technology. AT&T has the technology. The
NAFTA means tremendous opportunities for the U.S.
telecommunications industry.
Yunker plastics faces a 10 percent to 15 percent tariff on their
products in Mexico right now. The NAFTA would certainly cut this,
if not get rid of it completely, making Yunker a top competitor for
Mexico's aquaculture and agricultural markets.
Every single one of these businesses will benefit from the
NAFTA. As far as I'm concerned, increased opportunities for
Wisconsin businesses translates into one thing: more jobs for
Wisconsin.
And, as I said before, these are high-paying jobs. For example,
in 1991 the average hourly wage for workers in industrial machinery
and computers was $12.88; for workers in publishing and printing,
$12.07; and for workers in transportation equipment, $15.14.
In sum, the NAFTA will mean expanding U.S. imports. The NAFTA
will mean increased demand for U.S. products abroad. The NAFTA will
mean increased business opportunities for U.S. companies. And the
NAFTA will mean creating U.S. jobs.
That sounds like a pretty good economic plan to me.
The Clinton Administration supports the NAFTA. That's what they
say, at least. President Clinton says he supports it. His Labor
Secretary, Robert Reich, said in a speech last week that he
supports it. But what we hear coming out of the Clinton
Administration is hardly a ringing endorsement. I think the
President should get out there and sell the NAFTA as hard as he is
trying to sell his budget package.
I know he thinks his budget package is the key to getting our
economy moving again. I happen to disagree. And I know from
experience that raising taxes hurts business and destroys jobs.
Free trade is the answer. And I know from experience that
boosting international trade increases business opportunities and
creates jobs. It worked in Wisconsin. It will work in America. And
the NAFTA is the way to do it.