Pressure mounting for trade rep to resolve tariff dispute

By Jami Jones, senior editor | 3/4/2010

The retaliatory tariffs Mexico imposed on U.S. goods following the end of the cross-border trucking pilot program that ended last year drew fire yet again this week.

U.S. Trade Representative Ron Kirk and U.S. Secretary Ray LaHood were delivered a letter signed by 56 lawmakers urging an end to the tariff dispute.

The lawmakers called on the Trade Rep and DOT to go public with their plans to resolve the tariff dispute.

“We are writing to express our concern about the lack of action and transparency … to address tariffs imposed by Mexico on U.S. agricultural and manufacturing products,” the letter states.

“The current situation is unsustainable and untenable. Our constituents need help immediately, and we implore you to work quickly to implement a solution that ensures safety and normalizes trade between the U.S. and Mexico.”

The letter, spearheaded by Rep. Dennis Cardoza, D-CA, and Rep. Rick Larsen, D-WA, was delivered to the Trade Rep’s office and DOT on March 1.

The letter marks another notch in the increasing pressure facing the Obama administration to address the tariffs.

The Federal Motor Carrier Safety Administration pulled the plug March 11, 2009, on a pilot program that had allowed Mexico-based motor carriers long-haul access to the U.S.

The highly contentious program lost its funding when President Barack Obama signed the 2009 transportation appropriations bill into law on March 10, 2009. The next day, FMCSA started the process of shutting down the program.

One week later, Mexico struck back hard, implementing tariffs on some 90 U.S. goods – tariffs carrying a price tag of approximately $2.3 to $2.4 billion.

Mexico officials claimed to have imposed the tariffs because ending the cross-border program would potentially cost Mexico up to $2 billion.

U.S. lawmakers have repeatedly called foul on Mexico’s tariffs, claiming the tariffs were everything from “inappropriate” to downright “illegal.”

The Owner-Operator Independent Drivers Association has been very critical of Kirk’s lack of action on resolving the tariffs. OOIDA President and CEO Jim Johnston sent a letter to Kirk in February challenging the lack of action from the U.S. Trade Representative’s office.

“It is irresponsible for you to stand back as those tariffs continue to jeopardize U.S.-based businesses and American jobs,” Johnston pointed out.

Kirk told U.S. lawmakers this past year that the quickest way to end the tariffs was to launch another cross-border trucking program with Mexico.

“That statement and others that you have made recently to the media seem to ignore the immense safety and security implications of providing Mexico-domiciled trucking companies and truck drivers with unfettered access to U.S. highways,” Johnston wrote.

Johnston detailed the concerns of U.S. truck drivers in opening the border to long-haul operations from Mexico. Those concerns include highway safety, border violence, the out-of-control drug cartels and drug trafficking.

He also reminded Kirk of the mountains of regulations that face U.S. truck drivers every day – something that does not exist in Mexico. The regulatory realm that U.S. truckers face every day contributes heavily to the cost of simply being in business.

“As you stated last year after a NAFTA arbitration panel ruling, ‘… neither the NAFTA nor other U.S. investment agreements prevent the federal government or our states from regulating in the public interest, including to protect the environment, public health, and safety.’ I could not agree more,” Johnston wrote to Kirk.

“If a new cross-border trucking program were implemented at this time, U.S. truckers would be forced to forfeit their own economic opportunities while inadequately compensated Mexican truckers, free from equivalent regulatory burdens, take over their traffic lanes.”

To read Johnston’s complete letter, click here.

The Association has also called on its members to contact their lawmakers and Kirk’s office in a Call to Action. Click here to see the CTA.

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