7 Investigates: Jobs & Pay – Wisconsin’s Trade Future
A multibillion dollar question about Wisconsin’s job and pay future could be created if President Donald Trump renegotiates the North American Free Trade Agreement, or NAFTA, a NewsChannel 7 investigation revealed.
“Forty-six percent of Wisconsin’s exports go to Canada or Mexico. That is a lot of money that is placed in jeopardy and a lot of industrial jobs,” Kurt Bauer, president of Wisconsin Manufactures and Commerce, said. Bauer represents 3,800 state employers. “There just aren't enough people in the United States to buy a Wisconsin-made, Wisconsin-grown product,” Bauer said. “We need to export."
For more than 20 years, NAFTA has meant Canadian and Mexican producers have not paid extra taxes and fees on the products they send to be sold in the United States. The contract works the same way when U.S. producers, including those in Wisconsin, send their goods to Mexico and Canada.
The most recent
shows NAFTA brought in $10.2 billion for the state’s economy in 2015. In total, trade accounted $22.4 billion. In America’s Dairy Land, industrial machinery was the state’s top exported product.
"Seventeen percent of our business is done with companies that are part of NAFTA," Mitchell Metal Products President Tim Zimmerman said.
Inside their Merrill factory, hospital bed parts account for some of the 15 percent of products the some of the 75 employees are helping make and send to Mexico. Another 2 percent of goods produced here, mainly their famous Christmas wreath rings, are sent to Canada.
"If NAFTA stays in place, it's not a threat to us,” Zimmerman said. “If it's revoked, there is certainly some potential we could lose some business.”
While some supporters say NAFTA is good for consumers, who are able to enjoy more foreign made products coming into the country, while paying cheaper prices, critics, including President Trump, maintain NAFTA is a bad contract.
“I have very serious concerns about NAFTA. It’s been a catastrophe for our workers, our jobs, our country,” Trump said during a recent meeting with members of Congress. “Maybe we do a new NAFTA with an extra ‘F,’ free and fair trade, not just free trade because it’s very unfair.”
The president’s “unfair” argument echoed how many manufacturing workers feel. They say importing things we like from foreign countries free of taxes and fees, instead of making them here at home, means there is a constant risk their job could go to another country where it is cheaper produce those products.
“What do they call it? Free trade. That's seems like the wrong terminology. It should be fair trade,” Autoworker Rob Fleming said.
“Our country seems to be, you know, let's buy from everybody else and we're losing jobs daily,” fellow autoworker David Brelat said.
The most recent
show since 1994, when NAFTA was signed into law, 86,300 manufacturing jobs have been lost.
However, with the NAFTA hesitation comes regulation relief.
Both Bauer and Zimmerman say since there is a feeling the administration will end certain regulations, that means producers are now spending money to build new products. like a new desk line inside Mitchell Metal products.
“Regulation for American industry may back down," Zimmerman said. “And that frees up cash that can be used for investment. And when businesses invest, typically jobs are created."
Zimmerman said if that feeling holds true, he would like to add 20-25 new jobs in the coming years.
"I believe there is a Trump effect,” Zimmerman said. “How long that will last, I don't know."
The question remains, as uncertainty surrounds a possible redo of a NAFTA contract currently meaning billions of dollars in profits for Wisconsin business owners who sell their products to Mexico and Canada.
The other big question for consumers, could be the possibility of a trade war. If part of the president’s renegotiation that includes adding taxes and fees onto the goods Mexico and Canada send to the U.S., many economists fear those counties could do the same causing consumers to have to spend more on products made in foreign countries.
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