Wednesday, June 7, 2023

Abbott’s border moves will have economic impact, business leaders fear

Step – In the language of business, time is money. Business leaders and trade experts fear that Texas Gov. Greg Abbott’s new directive to step up security inspections of commercial vehicles at the border could take a long time and, as a result, cost them a lot of money.

“It’s going to be chaos,” said Norma Jean Payne, president of the Transportation Club of DFW, an organization whose members represent more than 50 North Texas transportation, supply and logistics companies. “We’ve had so many problems in our supply chain over the last year and a half, two years – I don’t think anything that’s going to delay or cause more problems is a wise decision at this point. There has to be a better way to handle this.”

On Wednesday, Abbott said his plan to increase the number of state inspections is a response to the Joe Biden administration’s decision to end the ‘Title 42’ health directive, created during the pandemic to allow quick expulsion. of migrants crossing the border. During increased security inspections, state agents could, in theory, discover more migrants among the thousands who cross the border illegally every day in hopes of receiving political asylum in the United States.

However, some business and political leaders along the border, including some conservatives who support the Republican governor, point out that federal agents already routinely inspect commercial vehicles as they cross the border. Additional roadside inspections by Texas officers could add hours to business travel.

“I think there are good intentions behind Governor Abbott’s actions and my respects to him, but we have to make sure this process doesn’t affect the supply chain,” said Ernesto Gaytán Jr., president of the Texas Truckers Association.

Gaytán explained that each cargo truck that crosses from Mexico to the United States has already had to pass through four security filters in Texas: one carried out by Customs and Border Protection (CBP), one by the Federal Motor Carrier Safety Administration (FMCSA) and the Texas Department of Transportation (TxDOT), another conducted by the Texas Department of Public Safety (DPS), and a final one about 30 miles from the border at CBP and Border Patrol checkpoints.

Inspections at these security checkpoints already take at least four hours off drivers to deliver truckloads to their destination. The delays could increase freight costs, he said, both from lost time and fuel used, which would end up being absorbed by Texas consumers at the end of the day.

“We will oppose any action at the state level that results in an inspection process that duplicates the inspections already done by CBP,” said Britton Mullen, president of the national organization Border Trade Alliance, in a statement made from its headquarters in Washington. DC

“While border states like Texas play an important role in ensuring truck safety and code compliance, the state should be working collaboratively with CBP, not participating in a new inspection system that will slow the transportation of cargo, which will only worsen the country’s supply chain crisis and put even more pressure on consumer prices.”

The stakes are high, even for consumers.

Mexico is Texas’ number one trading partner. Texas and Mexico share a 1,254-mile border that is connected by more than 25 international crossing points. The two economies are one in many ways. In 2021, trade between Mexico and the United States reached $661 billion, according to data from the United States Census.

Texas is the state through which most merchandise from Mexico enters the United States. Data from the United States Federal Transportation Agency indicate that 70% of cargo trucks entering the United States do so through Texas.

“Time is money and long lines will make Texas less competitive as a state and America less competitive as a country,” said Raymond Robertson, director of the Mosbacher Institute at the Bush School of Government and Public Service at Texas A&M University.

In 2021, more than 30 million freight trucks entered the country through Texas. Of those, almost 2 million entered through Laredo with an approximate value of $243 billion.

More inspections and longer lines “would hurt us financially,” said Laredo Mayor Pete Saenz, who considers himself a conservative. “Longer lines mean less trade. Supply chains are affected and so are goods and services. Time is money. Border delays mean consumers are also waiting and this can affect inflation.”

“You have to balance border security and the economy, that’s a question for the governor,” Saenz said. She added that the governor did not consult with him on the decision, but said, “I’m sure the governor is putting these issues on a scale.”

Tony Payán, director of the Center for the United States and Mexico at the Baker Institute for Public Policy at Rice University, considered that the recent measures announced by Abbott are nothing more than an “electoral circus.”

“This is nothing more than the governor talking to his political supporters in this election year,” Payán said. “Checking random trucks to find where migrants are hiding in cargo transports is impossible; It is like looking for a needle in a haystack, but this is part of the political circus that migration has become.”

Abbott has already promised to help build a border wall and orchestrated the spending of billions of dollars on security issues, such as having the Texas National Guard and state troopers stationed along the border.

In Laredo, Geraldy “Gerry” Schwebel, CEO and vice president of IBC Bank and a longtime conservative, expressed frustration that he says federal immigration policies have failed to stop mass migration. He thinks Abbott isn’t helping to solve the problem either.

“Why can’t we solve it? Migration is a federal responsibility and this should not impede or impact the legitimate flow of commerce and people into the country,” she said. “Why do border communities leave this to us? I have a problem with anything that impedes the legitimate flow of goods and people across the border.”

Farther west on the US-Mexico border, New Mexico merchants see an opportunity.

“We can’t help but see this as an opportunity for New Mexico,” said Jerry Pacheco, president of the Industrial Border Association in Santa Teresa, New Mexico. “I just don’t get why Texas is shooting itself in the foot.”

World Nation News Desk
World Nation News Desk
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