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Wednesday, May 1, 2013

Mexico, U.S. more intertwined than ever, and we should take advantage of that, analyst says in advance of Obama visit to Mexico

Shannon K. O'Neil, in appearance at Institute of the Americas in San Diego, also promotes her new book, "Two Nations Indivisible: Mexico, the United States and the Road Ahead"

     shannon oneil Mexico analyst Shannon K. O'Neil, in a talk ahead of President Barack Obama's visit to Mexico on Thursday, said Tuesday that given the facts, Americans should be more enthusiastic about U.S.-Mexican trade than they perhaps are.

      She said almost 40% of "Made in Mexico" exports to the United States originate in the United States. She told the Institute of the Americas in San Diego that Mexican exports to the United States thus mean U.S. jobs.

      She said exports from China, Brazil and Europe to the United States have less than 4% U.S. content, and that products imported from Canada only have 25% U.S. content.

     "So as we think about the reality of today ... of global supply chains as you try to be competitive in a global world, Mexico now is by far and above the best partner not just for U.S. companies but for U.S. workers given how much there's back and forth in the production. Because today instead of the oil coming north as it used to and finished goods going south, today it's really pieces and parts moving across the border."

     O'Neil, a senior fellow at the Council on Foreign Relations, said Mexico has made great strides in the past two decades and that half its population is now in the middle class.

   She said Mexico is at a crossroads, and this is what Obama was going to be talking with President Enrique Peña Nieto about. She said Mexico must improve its educational system (and said education exchanges are likely to be announced in Mexico City), complete its judicial reforms and take greater measures to improve its security situation. Peña Nieto's administration has been accused of downplaying violence, and also is taking steps to reduce the influence of U.S. advisers on combating its organized-crime violence. She said the cost of added security is costing 1% to 1.5% of Mexico's GDP, or more, calling it Mexico's "Achilles heel." She said that if Mexico does not deal forthrightly with the situation, it could tear down everything the Peña Nieto administration is trying to do.

     She lamented that U.S. relations with Mexico too often have been put on the back burner as Washington deals with crises in the Middle East and focuses its attention elsewhere.

     "I would argue that today that no other country affects the United States on a day-to-day basis as much as Mexico. So whether it's the vegetables on our tables, whether it's the parts in our cars, or whether it's the gas in our tanks, the consumers for our goods, or the drugs on our streets, Mexico's part of our everyday life. So if Mexico does well, it will have (good) repercussions throughout the United States, and if Mexico fumbles or falters, it too will reach far into our nation."

     She also said, "The unprecedented wave of immigration of the last 30 years has brought our nations now permanently together." She said there are 11 million Mexicans in the United States, and 35 million she said "are tied on both sides of the border." She said, "Mexicans and their descendants two nations indivisible book covertoday are important in the United States as workers, they're important as consumers, they're important as community members, and as we saw in the election last November, they are increasingly important as voters."

     O'Neil also signed her new book "Two Nations Indivisible: Mexico, the United States and the Road Ahead," which is generally optimistic about the U.S.-Mexico future, and says Mexican democracy has advanced so much that Peña Nieto's Institutional Revolutionary Party will not be able to turn back the clock after 12 years of the National Action Party's having held the presidency.

Update, May 2: O'Neil is interviewed by Judy Woodruff on the "PBS Newshour." Her appearance begins at the 3:15 mark.