Mexico appears to have flouted NAFTA rules by applying a protectionist tariff to American milk in response to a slump in the market for Jalisco dairymen:
Mexico today announced a 30 percent import tariff on U-S milk.
Mexico seeks to help protect some local producers who reportedly face surpluses in the domestic market.
The Mexican Economy Department suggested the measure could be temporary, but said it will also limit milk import quotas for the private sector.
Several dairy organizations in the western state of Jalisco have been having problems since the beginning of the year selling their production.
I support NAFTA, but the American government had better find out why Mexico has cut our dairies out of the market as it tries to subsidize their own farmers. This is exactly the kind of measure that NAFTA was supposed to prevent. The entire point for the US was to gain access to open markets for its goods, while Mexico gained benefit from manufacturing jobs created by the elimination of tariffs on their goods coming back across the border. If Mexico feels free to impose tariffs on anything at its whim, then what good is NAFTA?
The Bush administration needs to address this quickly. After pushing CAFTA through a reluctant Congress earlier, Republicans need to make sure that they demonstrate that the US will not take kindly to being abused by our trading partners. (Hat tip: CQ reader Space Needle Boy)