The biggest, and most common, lie in trade discussion:

…. “China is not in NAFTA”

Yes they are.

Because of the stupid way it was created, any country that trades with Mexico or Canada is effectively in NAFTA.

 

By:

 

Did you know the biggest *sticking point* right now in NAFTA is within the Auto Sector? Did you know the biggest argument inside the Auto Sector is around “Rules of Origin”? Think about this carefully. Mexico and Canada are arguing for the smallest amount of North American parts in NAFTA automobiles possible.
The United States is arguing for the *biggest* amount of North American parts in NAFTA automobiles possible. Again, think about this carefully. Mexico and Canada are demanding more, as in *higher content*, Chinese, Asian and European parts in NAFTA (American) automobiles.

Canada and Mexico are *NOT* demanding higher content of Canadian and Mexican auto parts, they are arguing for higher content of Chinese auto parts. Why? If NAFTA was structured to help Mexico, Canada and U.S. why would Can/Mex be demanding more Chinese auto parts? This Can/Mex demand encompasses *total content*: including steel, metals, plastics and electronics. The Can/Mex teams are demanding higher content of Chinese parts. The U.S. team is demanding higher content of North American parts. Why would Canada and Mexico be fighting to allow more Chinese and Asian parts in vehicles? If you accept the Wall Street Journal, Fox, and U.S. Chamber of Commerce narrative on NAFTA trade the position of Can/Mex doesn’t make sense.

It doesn’t make sense, until you understand the fatal flaw in NAFTA. Asia, Europe and specifically China use Mexico and Canada as a backdoor of access into the U.S. Market. Asia, and China ship parts, and partially assembled products, into Mexico and Canada to be *finished* (usually just repacked) and shipped into the U.S. without tariffs or duties. It works out great for Canada and Mexico. Their ports are busy, they have workers doing the finishing assembly, and their economies thrive from this NAFTA “loophole” (fatal flaw). But for the U.S. there’s absolutely ZERO benefit. This is why Canada and Mexico’s NAFTA position in the Auto Sector is to fight for the maximum amount of Chinese parts possible to assemble in North American vehicles. (built in Mexico and Canada)
If you understand the *fatal flaw* in NAFTA, you understand it is false to say China is not “in NAFTA”. Au contraire. China is most certainly a part of NAFTA. China is “in NAFTA” by proxy. This is why NAFTA must be scrapped.
Canada and Mexico will never allow NAFTA to be a trade agreement only between the U.S., Mexico and Canada. It is against their financial interests to do so. Canada and Mexico make a TON of money by being secret gatekeepers providing hidden (discussed) access into the U.S. market. Canada and Mexico are essentially trade brokers taking a cut out of any trade action in the U.S. market. Mexico and Canada get paid a “trade toll” by countries (China) and international corporations (global) to give them access to these NAFTA doors. It’s a great deal for Mexico and Canada – it completely sucks for the U.S.A.
The NAFTA *fatal flaw*, and President Trump understanding it would be against the Can/Mex financial interests to fix it, is why POTUS was so clearly accepting a position of a U.S. NAFTA exit as the only route to correct the issue.

 

…. And the fatal flaw does not just apply to auto-parts, it’s everything.

EVERYTHING.

Including FOOD for final processing.

 

/END