Which state will suffer the most if President Donald Trump foolishly follows through with his threat to withdraw the United States from the North American Free Trade Agreement?
Michigan would be hardest hit, according to an analysis by the U.S. Chamber of Commerce. The Wolverine State sends 65 percent of its exports — worth $35 billion and supporting 366,000 jobs — to Canada and Mexico, our nation’s trading partners in NAFTA for 23 years.
But Wisconsin ranks a close second to Michigan as the biggest loser out of all 50 states, should NAFTA fall apart next year. Wisconsin sends 46 percent of its exports to Canada and Mexico, valued at $9.6 billion and supporting 249,000 jobs, the U.S. Chamber determined.
The harm to farmers would be severe. Mexico is the top export market for Wisconsin dairy products. And without NAFTA, our state could be stuck with a 45 percent tariff on cheese. Manufacturers also are worried. Their goods account for 84 percent of Wisconsin exports and almost half to Canada and Mexico. In addition, consumers would have to pay more because free trade lowers prices on both sides of the U.S. borders.
Yet Trump continues to behave erratically, suggesting NAFTA must be renegotiated on America’s terms or our nation will pull out.
Trump seems to misunderstand the goal of free trade. It’s not a zero-sum game in which one country benefits while another is harmed. When allies lower tariffs and allow more competition across international boundaries, all sides get to produce and sell more of what they do best.
Wisconsin’s leaders — Republicans and Democrats — must not sit idly by while Trump threatens to undermine the peace and prosperity that free trade encourages around the globe. Already, Trump has abandoned important trade negotiations with Pacific Rim nations, ceding leadership to China.
Now Trump is loudly demanding a better NAFTA deal that favors America, while threatening to bolt if he doesn’t get his way.
That’s a huge risk for Wisconsin. More than one of every five jobs in Wisconsin depends on foreign trade. And consumers benefit from lower prices for televisions, computers, toys and more.
It’s true free trade hurts some industries that struggle to compete on price or quality with foreign producers. But overall, more people in all partner nations get to sell and gain access to more of what they want at better prices.
“NAFTA has worked for Wisconsin,” Assembly Speaker Robin Vos, R-Rochester, said Friday in Madison, as a trade association, business groups and farmers touted NAFTA’s benefits. “It’s not the time to put new obstacles in place that would hurt the very markets that our business owners and farmers depend on.”
So are Democratic supporters of improving, not abandoning, NAFTA. U.S. Rep. Ron Kind, D-La Crosse, recently told the State Journal editorial board he’s holding his breath hoping Trump doesn’t do something foolish with Mexico trade.
“It would be devastating to our ag industry overnight,” Kind warned.
U.S. Sen. Ron Johnson, R-Oshkosh, understands the broad benefits of free trade. He should lobby the president to reconsider his harsh rhetoric and stance.
Wisconsin, more than any other state except Michigan, needs NAFTA to continue.