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Mexico's Felipe Calderon cites the achievements during his 6 years in office: the efforts to establish a rule of law state, reduce the influence of drug trafficking gangs, improve higher technical education with 113,000 engineers now graduating each year, generating jobs and economic growth, and reducing the flow of people moving across the border with the U.S. as conditions improve in Mexico.

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Pearlstein argues that the US and the Obama administration achieved most of its goals, even though the Europeans took the credit. On regulatory reform, Geithner's regulatory reform proposal he says, could well have been written at the French Finance Ministry, as at the US Treasury. And it gives Obama ammunition to prepare, as private equity, hedge funds, and banks try to water down his proposals for regulatory reform. By having member countries commit to adding $850 billion to the resources at the IMF, and regional development banks to provide help to countries in serious difficulties- and giving instructions that the money can be used not only for debt rollover, bank recapitalization and balance of payments support, but also for stimulus spending, infrastructure investment, trade finance and social support- the Obama adminstration has accomplished a great deal. It has succeeded in putting in place the necessary financial resources to support not only the financial systems of countries in Eastern Europe, Asia and Latin America that need help, but put emphasis on the need for resources to go for helping reduce job losses, create jobs, and provide some forms of income or support to people in these countries. This is a major step as it means the countries of Eastern Europe and other developing countries can deal with their crises in confidence. Mexico is taking loans from the IMF. Dominique Strauss Kahn had begun the policy of shifting IMF's focus to these social goals as significant parts of the recovery process in countries, but he faced the old mindset among the IMF staff, as when its reported staff wanted to increase interest rates in Pakistan by 10% instead of the 3% that was finally agreed to. That would have caused serious difficulty to the people of Pakistan, created chaotic situation and disturbed the social fabric of that country. See the link to this for S. Korea and for Pakistan. And as Gordon Brown put it the old conditionality that lay behind the IMF loans, is phased out. This makes it the new policy at the IMF backed by the G20 mandate. The Washington consensus which prescribed open borders, floating exchange rates and fiscal prudence is now ended. And to support this change the developing countries will have a bigger say in IMF policy and decisions. ...

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During the presidential debates Donald Trump was asked about his proposal for a 45% tariff on imports from China to the U.S.. Trump's response was "if they don't behave." he would use this as a negotiating tactic against China. Senator Ted Cruz of Texas responded by reminding viewers of the high tariffs under Smoot-Hawley legislation that were one of the factors that created the Great Depression in the 1930's. Economist and former Federal Reserve chairman Bernanke is a student of the Great Depression, and says "it was highly counterproductive, it lengthened and deepened the Great Depression." Economist Peter Petri of Brandeis University in his study cited in this article, says that the tit for tat that starts with such a move could eventually cost the U.S. 1 million jobs. It might fix one problem the one of imbalanced trade with China his figures show, and create another huge problem the loss of markets for U.S. goods all over the world. Overall a 45% tariff would reduce U.S. merchandise imports by $383 billion and reduce U.S. merchandise exports by $658 billion, says Petri. Gordon Hanson, economist at the University of California, San Diego, who has actually shown how trade has affected different counties in the U.S., leaving some dependent on government assistance. Hanson sees this tariff as counterproductive, it makes the U.S. more self-sufficient but hurts U.S. exporters, would significantly hurt the tech boom, and reduce America's standard of living. The problem is that everybody can get into this in a tit for tat. France did this even before the Smoot Harley Act of 1938 was passed in 1930 with 60% increase in tariff on individual items, by higher tariff legislation in 1928. Close allies Canada followed quickly after Smoot Hawley increasing its tariffs, so did Great Britain. Unemployment went up significantly after 1931, worsened by weak banks and lack of support from the Federal Reserve. Trade with Mexico would come to a halt Petri shows, and the result would be more Mexicans trying to cross the border turning a relatively non existent problem of immigration in 2015 -with Mexicans preferring to remain home and net immigration dropping significantly following the 2008 financial crisis and the strict Obama policy of deporting illegal immigrants- into a real one. Trump says its just a threat, but it is likely to lead to a tit for tat response by China, then by U.S. allies, other trading partners. Consider that president Herbert Hoover opposed the Smoot Hawley bill for raising tariffs on industrial goods, and only proposed adifferent legislation reducing tariffs on industrial goods and increasing the tariffs on agricultural goods to give relief to American farmers. Politics intervened as Smoot from Utah and Hawley from Oregon, from mountain and agricultural states with a lack of understanding of how the international trading system works but as heads of two influential commmittes, the Senate Finance Committee and the House Ways and Means Committee, let politics overrride and pushed their legislation through Congress. In 1932 Smoot and Hawley were defeated for reelection, but the damage had been done, and promises of better conditions for workers and farmers never kept. A significant reason for the U.S. standard of living is that it is a leader in the global trading system. Even in 1945 and the years following the end of the war tariffs were higher in Britain and other countries. In return for this leadership the U.S. enjoys the advantages of the dollar being the main global currency, and the advantages of a world leading technological sector that has large global markets. Hanson and Autor have pointed out how imbalanced trade has hurt some counties in the U.S. This is a very real problem for workers in the manufacturing sector, as shown by elections in the midwestern states, Michigan, Ohio, Illinois and other parts of the country. The problem is compounded by the tech sector looking out for itself, the financial sector looking out for itself, and forgetting that we are all in the same boat. And that includes the Chinese who are in the same boat. China is doing a major shift in policy towards a consumer driven economy, and this needs to be accelerated for the benefit of ordinary Chinese. This makes the policy of a 45% tariff by the U.S. doubly unproductive because it hopes to add urgency to the problem of the U.S. trade deficit and manufacturing workers, but takes an approach that risks ending up damaging the global trading system by setting in motion a process that no one controls or can foresee the destination....

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The situation in Tampico, Mexico, with corruption, crime and dangers to public safety, show the problems Mexico is still grappling with to ensure a rule-of-law state right next to the U.S. The paradox is that of a breakdown in public safety with Calderon's war against drug gangs undermined by corrupt police and local government, and the continued foreign investment in the country. DuPont is investing $500 million in a new plant near the port of Tampico and South Korea's steel manufacturer POSCO is planning a $300 million investment to double production in this area.

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Max Fisher of the NYT points out the unique approach taken by Canada in the U.S.-Canada relationship - to cultivate a grassroots network of Americans in legislatures, business, and at different levels of government. This has enabled the Trudeau government to build a relationship with president Trump, and at the same time have relationships at different levels of government and with business in the U.S. to tackle issues where the Trump administration has acted in ways unfavorable for Canada. Provincial governments in Ontario and Quebec lobbied against a New York state government provision for Buying American on state contracts worth over $100,000. By emphasizing the $10 billion in exports from New York to Ontario this lobbying persuaded the New York legislature to cancel the provision. Premier Trudeau's popularity helps and the proximity to the U.S. means Canadians can visit quickly and understand the U.S. as a close neighbor. Still Premier Kathleen Wynne of Ontario says Canadian businesses are nervous about the uncertainty from the Trump administration.   ...

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Juarez, the city across from El Paso, has done well in the last 10 months with 27,000 jobs added in the maquiladoras. These foreign owned factories continue to attract business interest even with a drug war raging in the background. The reason is that Juarez connects straight to American Interstate highways and this makes it possible to deliver goods in 3-4 weeks in some cases from the time of order compared to 10 weeks for China. And wages can run as low as $4.21 an hour. Companies get incentives in the tax treatment and worker training is supported by the local government.

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Enrique Pena Nieto of the PRI party wins the presidential election in Mexico with 38% of the vote. Lopez Manuel Obrador came second with 31% of the vote, and the candidate of the ruling PAN party, Ms. Vazquez Mota came in third with 26% of the vote. Voters were eager for change afer 12 years of rule by the PAN party under Vicente Fox and Felipe Calderon. Mexico averaged growth of 2% during these years, though growth has increased since the financial crisis. But the benefits of globalization, foreign investment, and trade reached the better educated and skilled workers leaving many behind. This period included negative growth during the 2008 financial crisis. .

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Chnages to Mexico's labor laws passed in Congress and to be signed by president Calderon include companies having to pay only one year of back wages to laidoff workers for lawsuits on unfair dismissals. The law also formalized part-time work and temproary training contracts. The effort is likely to foster greater formalization of the workforce and push fewer workers into the underground economy. About 29% of Mexican workers are in the underground economy, where worker protections and legal benefits are lacking. Also made part of the law an yearly audit of union finances and election by secret ballot for unions. Mexico's large public sectors form a core base for support of the newly elected PRI government.

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Micky Hammon sponsored Alabama's HB 56, Alabama Taxpayer and Citizenship Protection Act, which passed in the legislature in 2011. The illegal immigrants it was said would follow "self-deportation" as the law would require frequent checks by police, and make renting a house or giving a job to an illegal immigrant a crime. The policy would be followed in schools also. At the time Donald Trump is cited by the Washington Post's David Weigel as telling reporter Kessler that the policy was "crazy," and "maniacal."

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The increasing competitiveness of Mexico compared to China and India as an investment destination in 2013. Foreign companies are investing heavily in Mexico because of investment advantages in labor cost, supply of engineering and management talent, and proximity to the U.S.

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The shift of offshore manufacturing jobs from China to Mexico in 2014-2015.

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There is little chance that Mexico is going to pay for a wall, or that it is possible to prevent remittances by Mexicans working in the U.S., says O'Grady in the WSJ. President Obama says about preventing each and every Western Union remittances transaction "good luck with that."

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This editorial in the WSJ points out the dangers to the Republican party in taking the stand on immigraton along the lines suggested by Donald Trump in August 2015- deportation for all illegal immigrants, no birthright citizenship for children of illegal immigrants, and no remittances allowed for illegal immigrants to their home countries. It points out that remittances actually improve the economies of the countries south of the U.S. border in Latin America and reduce illegal immigration. There is a need for seasonal workers in farm areas where there is a severe shortage of workers even at $17 an hour. Reducing immigration is better accomplished by more guest worker programs. A likely result would be the move of farms and factories to regions with low cost labor in Latin America or other countries. For the Republican Party this type of policy would bring back the period of the 1920's, says the WSJ, when Irish and Italian immigration was opposed by the party, alienating the two ethnic groups till they were won back in the Reagan period- a sure way to lose in 2016....

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An indepth look at Mexico, its assets, its huge potential and what is holding Mexico back. It ranks much higher than Brazil in many respects- higher investment as a fraction of its GDP, technical education, an easier place to do business, less regulation, better management talent, more industrialized. In 2010 Mexico had $400 billion of business with the U.S. With rising Chinese wages Mexico is an attractive place for foreign investment, with a hardworking and educated workforce. Mexico suffered badly during the 2008 recession in the U.S. It is trying to reduce its dependence on exports to the U.S in key areas such as the automotive industry. Exports to the U.S. by the automotive industry are now 65% of the total, and the auto industry association in Mexico is working to bring this figure to 50% by exporting to Latin America and Europe. Economic growth was 5.4% in 2010, and expected to be 4-5% in 2011. Drug violence may have reduced the growth by one percentage point according to some estimates. The think tank, Mexican Institute for Competitiveness, estimates that economic growth would be 2.5% percentage points higher if labor market and competition laws are changed, and the oil industry is opened up to foreign investment as happened in Brazil. A study by OECD and the Federal Competition Commission (CFC) of Mexico has shown that 31% of Mexican household spending goes to products operating in high price monopolistic or oligopolistic markets. The bottom ten percent spend even higher proportion of incomes, around 38%, for products supplied in such markets. This includes pharmaceuticals, airline travel, banking, and electricity. Taking on these cartels is a difficult task. The CFC is beginning to take the first steps in this direction, in what will be a long road to fair prices for Mexican consumers. Banking was opened to Wal-Mart. The collapse of Mexicana was an opportunity to auction landing slots to other airlines. An auction system has been developed by CFC for drugs. A new competition law sets penalties for collusion in pricing, with upto 10 years in jail. And Carlos Slim's telephone monopoly was fined $1 billion for its telecom monopoly practices. In 2009 the Calderon government shut down Luz y Fuerza, a state electricity company costing the governmment $3 billion in subsidies for an highly inefficient operation. ...

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If John F. Kennedy were writing Profiles of Courage in 2024 he would have James Lankford as one of these Senators who showed courage to take the right stand in the face of opposition from his fellow Republican Congressmen and people in his state and the country who support loyalty to president Trump. Lankford says in this NYT interview that in December 2023 the immigration bill would have passed Congress into law. He has always seen that no one person is the boss. Trump is not the boss even as president. He is a co-equal branch, says Lankford. He sums it up saying- I work for the people of Oklahoma not the president.  Senator Lankford of Oklahoma is interviewed by Lulu Garcia Navarro of the NYT for his role in negotiating a immigration bill with Democrats in Congress and president Biden that would fix asylum policy and close the Border with Mexico. It is a tough bill says Lankford, and the Republicans held onto their position that there would be no citizenship for the immigrants who crossed the border illegally since 2024. If it came up in December 2023 it would have fixed the Border, says Lankford. It came up in February, and by this time the election nominee was Trump who decided not to support it, as it would take away the immigration issue that he hoped to run on against Democrats. It is still alive as Kamala Harris says it is her top priority to get the Lankford immigration bill passed into law. To know Lankford is to know that he ran the largest Baptist youth camp in the Nation at Fall Creek. He believes every person has value and worth and even if he disagreed with them that person has value and worth. His faith, he says, is something important for him, and not something you take off and put on.  The title should be The Men and Women who Solved Immigration for the Nation. This includes Republican Senator James Lankford of Oklahoma, Senator Krysten Sinema of Arizona, and Democrat Senator Chris Murphy of Connecticut. Lankford for 22 years a youth Baptist minister from Oklahoma, Sinema immigration attorney from southern Arizona, and Murphy a lawyer from Connecticut. The man who selected Lankford to negotiate the immigration bill on behalf of the Republicans in Congress was Senator Mitch McConnell of Kentucky. For the Democratic party Pat Schumer helped bring Democrats in Congress and president Biden behind a tough bill that reflected the consensus view that something serious had to be done about the US Border for a lasting solution. This opportunity may come again if Kamala Harris wins as she says it will be her top priority to get the Lankford -Sinema Bill passed. ...

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Foreign investment in the auto industry is having a significant impact in the growth of Mexico's middle class. VW has plants in Puebla, General Motors in Silao, Chrysler in Toluca, Nissan in Aguascalientes. Production increased by 24% in February 2012 over the prior year. The growth is likely to continue. Facilities in Mexico have high productivity and are technologically equiped comparable to plants in the U.S., Europe and Japan. Nissan plans a $2 billion investment in a plant in Aguascalientes. Because of the lower cost of living, with food, transportation and health care costing less, even though household appliances cost more, workers at a Mexican plant earning $4 an hour in pay and benefits or $130 a week can still have a decent standard of living. Foreign investment is likely to grow with Mexico's emphasis on technical education - about 130,000 engineers graduating each year according to Mexico's president Calderon- the work ethic of young Mexicans joining manufacturing plants, the productivity of these lower cost plants, and a growing market in Latin America. Nissan plans to produce 1 million cars in Mexico with an investment of $2 billion in Aguascalientes. Nissan has succeeded in taking over from VW as the preeminent manufacturer in Mexico, and has 32,000 workers in the Aguascalientes area, once a small town but now a thriving city of 700,000. Drug cartels have no interest in places like Aguasalientes, which is why foreign investment continues to come into Mexico. The lack of economical credit- interest rate on car loans is about 10%- and the flow of about 600,000 used cars each year into Mexico from the U.S. has restricted growth in Mexico's automobile market. Jose Munoz, Nissan's senior executive for Latin America sees this changing as more credit including Nissan's new financing center in Aguascalientes make lower cost credit easily available to a growing middle class....

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Denning points out the shift in Mexico to becoming a net oil importer from the U.S. by August 2013, that put new urgency to the passage of the oil law in Mexico for attracting foreign investment. Mexico's exports of crude oil were about 0.9 million barrels a day in August 2013. U.S. refinery products imported by Mexico including gasoline on an oil equivalent basis were 0.8 million barrels a day. Mexico became a net importer of energy in March 2013. Another negative factor in the energy trade between Mexico and the U.S. is increasing U.S. oil production and refineries in the coast of the Gulf of Mexico being full. As this U.S. production increases Mexico would have to offer competitive discounts in the future. Pemex drillled in all 25 deepwater wells in the last decade, according to Sanford Bernstein. The U.S. in the same period drilled 1500 ultra-deep water wells alone, showing the urgent need for foreign investment in the Mexican oil industry.