NAFTA architects: Ripping it would be 'disastrous'

Michigan workers hate NAFTA but love robots
Michigan workers hate NAFTA but love robots

An atomic bomb. Disastrous. A nightmare scenario. Tragic. Absolutely destructive.

These were the dire words used by three of the original negotiators of NAFTA to describe what would happen if the deal was thrown out and protectionist trade policies ruled.

NAFTA is the trade deal between U.S., Canada and Mexico that's under siege from President Trump. He has threatened to rip up NAFTA if a new deal can't be reached from renegotiating it.

The three original negotiators see the global economic and security order at risk if the Trump threats of tariffs and protectionism become reality -- and other countries adopt the same policies in retaliation.

Protectionism "is an atomic bomb for trade," said Jaime Serra Puche, Mexico's former secretary of trade and industry. On ending NAFTA: "We will be shooting ourselves in the foot as a region."

The sentiment was echoed by Carla Hills, former U.S. trade representative under President George H.W. Bush: "If we cut off our neighbors, we're cutting ourselves."

Related: What American manufacturing looks like in the Trump era

If the United States "decided to withdraw from the NAFTA, I think the results would be disastrous," said John Weekes, Canada's former chief NAFTA negotiator.

The three former negotiators were reunited at a panel discussion held at the University of Minnesota's Carlson School of Management to defend the gains of NAFTA.

Trump labeled NAFTA the "worst deal ever" and a "one-sided deal" that's only benefited Mexico.

Unsurprisingly, NAFTA's architects disagree.

"I give it an A+, maybe an A++," said Hills, who was also one of the first women in U.S. history to serve in a cabinet role as secretary of housing and urban development in the Ford administration.

"It's been good for Canada," said Weekes, 75.

"It went way beyond what we were predicting," said Serra Puche, 65.

Related: Mexico ready to 'step away from NAFTA' if new deal isn't good

Hills, 83, is today just a little older than Trump's top trade negotiator, 79-year-old commerce secretary Wilbur Ross. She cited some stats to back up her grading of NAFTA.

Before the agreement was signed in 1994, about 700,000 U.S. jobs depended on trade with Mexico, Hills said. Today, 5 million American jobs depend on trade with Mexico.

She also pushed back against Trump's strategy to negotiate one-on-one trade deals with countries instead of agreements with multiple countries like NAFTA.

Her argument: The vast majority of U.S. exporters are small and medium sized businesses. With several individual deals, those business owners would have to learn different rules and regulations for each country they export to.

Related: Trump 1, free trade 0: G20 drops pledge to fight protectionism

"I don't know how these small businesses will manage," said Hills. She argues that such a headache for employers justifies large, multinational agreements.

Serra sees two events colliding soon: NAFTA negotiations and Mexico's presidential elections in July 2018. The current president, Enrique Peña Nieto, cannot run again because of term limits.

Already, populist Mexican leaders like Andres Manuel Lopez Obrador are gaining traction early in the campaign for taking critical stances against Trump.

Ross, the current U.S. trade negotiator, said formal talks won't begin until the "latter part" of 2017. He expects talks to last about a year, which means it would go past Mexico's elections.

"I can picture a scenario in which we're in the middle of the negotiations and the politicians are in the middle of the elections...[and] the most radical candidate and the most anti-American candidate will have the most popular support. That could easily happen," Serra said. "I can see retaliation after retaliation after retaliation...that is a nightmare."

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