Pierce and Lopez: Tomato pact will continue to help U.S. and Mexico
By Steve Pierce and Linda Lopez Our Turn Fri Jan 18, 2013 7:40 PM
President Barack Obama’s administration will soon make a critical decision affecting U.S. consumers, U.S. and Mexican jobs and U.S.-Mexico relations when it decides the future of the U.S.-Mexico tomatoes agreement.
That pact, which for 16years has brought stability to the U.S. market for fresh vegetables, has been under attack for months by a handful of Florida growers seeking to eliminate all competition in the U.S. market by terminating the agreement. Ending the agreement would reduce the supply of fresh vegetables in the U.S., tax consumers and eliminate tens of thousands of jobs in the U.S.
As Obama enters his second term and welcomes Mexico’s new president to the North American Free Trade Agreement community, it is critical that he take the high road by rejecting protectionist pleas that will surely harm businesses and workers on both sides of the border.
Florida growers have been trying to get the U.S. government to let them corner the tomato market for many years. In 1996, they filed one in a string of trade cases trying to impose stiff taxes on Mexican tomatoes. The U.S. Commerce Department and the Mexican growers, trying to avoid an all-out trade war, reached an agreement setting a minimum price for the sale of Mexican tomatoes in the United States. That agreement has worked well. No violations have ever been found.
Now, the Florida growers are seeking even greater protection by trying to kill that agreement so they can file yet another trade case. It might be good for the four or five families who run the Florida tomato business, but not for anyone else. It is clear that tomato prices would increase dramatically if Mexican tomatoes are driven from the market.
Termination of the tomatoes agreement would lead to the loss of tens of thousands of U.S. jobs, including those who work in produce distribution, transportation, warehousing, food safety, retail and food service. This includes many jobs in Arizona, where Nogales is a leading port of entry for tomatoes.
Killing the tomatoes agreement also could have enormous employment consequences in Mexico, where the tomato industry employs 350,000 workers, harming families and putting security pressure on the U.S. border.
Finally, termination of the tomatoes agreement could lead to a trade war between the United States and Mexico, which could harm industries on both sides of the border. In fact, the list of U.S. business groups that have lined up against termination of the tomatoes agreement include the U.S. Chamber of Commerce, the U.S.-Mexico Chamber of Commerce, the Fresh Produce Association of the Americas, the National Pork Producers Council, the Food Marketing Institute, the USA Rice Federation and the U.S. Dairy Export Council, among many others that include food giants such as Walmart. These industries export billions of dollars’ worth of products to Mexico each year, accounting for tens of thousands of U.S. jobs. They, as well as their counterparts in Mexico, know that a tit-for-tat trade war is bad for workers and businesses on both sides of the border.
Obama’s administration has the opportunity to renegotiate this agreement and maintain the stability it has brought to the market for fresh vegetables. It has been reported that the Mexican growers have offered to increase the reference price to a level that would keep the peace without harming U.S. consumers, U.S. workers or Mexican workers, and without starting a trade war that could harm the U.S. economy. There would seem to be little reason to do anything else.
Steve Pierce, R-Prescott Valley, and Linda Lopez, D-Tucson, are Arizona state senators.