NAFTA “Superhighway” Spells the End of NAFTA Countries Manufacturing Alliance
William R. Hawkins
American Economic Alert
Tuesday, July 18, 2006

“HIGHWAY OF DEATH” FOR NAFTA

There has been a flurry of media reports about what has been dubbed the “NAFTA Highway,” a corridor of both highways and railroads running through Mexico and into the American Midwest. Interstate Highways 35, 29 and 94 are central to this transportation network and the key terminal is an “inland port” in Kansas City, Missouri.

Many of the reports have sought to reopen the debate over the North American Free Trade Agreement, which allowed many U.S. factories to relocate to Mexico, laying off thousands of American workers and replacing them with much cheaper labor south of the border. Some reports have taken an alarmist tack, claiming that further economic integration of the United States and Mexico would lead to a political union that would open America to mass migration and political corruption on a scale that would destroy U.S. institutions, culture and sovereignty.

In actuality, the new energy being put into expanding the transportation network from Mexico into the United States heralds the collapse of NAFTA, and further discredits the trade strategy followed by the administrations of George H. W. Bush, Bill Clinton and George W. Bush.

NAFTA was enacted in 1993. The main public arguments put forward by its proponents were that it would open Mexico to more U.S.-made exports and that Mexico, with the addition of new, American-owned factories, would become an export platform permitting American firms to compete in markets throughout the world. (It was also supposed to halt illegal immigration and illegal drug transhipment – but that’s a subject for another column.)

Since the Mexican economy was only five percent the size of the American economy, our export opportunities were limited by the lack of purchasing power to the south. The real interest of the business groups that pushed NAFTA through Congress was to combine cheap Mexican labor with American capital and technology to improve competition with overseas rivals – for shares of the American market. At the time, Japanese firms, which had located factories in other Asian countries with cheap labor, were thought to be the main rivals. Yet China was already looming, unrecognized, over the horizon.

Two of the most vocal proponents of NAFTA testified to this effect before the House Ways and Means Subcommittee on Trade on September 11, 1997. C. Fred Bergsten and Jeffrey Schott, of the Institute for International Economics, stated, “The United States sought to increase its imports from Mexico as a result of NAFTA. In particular, we wanted to shift imports from other countries to Mexico – since our imports from Mexico include more U.S. content and because Mexico spends much more of its export earnings on imports from the United States than do, say, the East Asian countries.” The higher U.S. content in imports from Mexico was the result of sending components from American factories to Mexican factories for assembly into products that are then exported back to the United States.

Such imports from Mexico grew rapidly (while Mexico never emerged as the “export platform to the rest of the world”), and there was congestion in the US-Mexican transportation system as a result. But that is not what is driving the NAFTA superhighway activity now, over a dozen years later. The North America’s SuperCorridor Coalition (NASCO) was formed in 1994 to lobby for government funding for improvements in the multi-modal U.S.-Mexican transportation system. But over half the money it claims to have raised has come since 2003. In 2005, the Kansas City “SmartPort” received $4 million for highway corridor projects, plus another $500,000 earmark from Sen. Jim Talent (R-MO) to further develop the capabilities of the inland port to process a greater volume of international trade. Additionally, the first steps to establish a Mexican customs office at the Kansas Smartport were taken last year. And it wasn’t until last December that the Texas Transportation Commission opened negotiations with a the Spanish-led Cintra consortium to start the first phase of a $7.5 billion, 800-mile corridor from Oklahoma to Mexico that would parallel Interstate 35.

Upon closer examination, something other than the “success” of the NAFTA model, as sold to the American voter, is propelling all this transportation and Smart Port activity – and that is the massive wave of imports from the previously unrecognized export superstar, China. U.S. west coast ports are swamped with container ships filled with Chinese goods, and a scramble is on to find new Pacific ports to bring even more Chinese products into the United States. Container ship traffic from China is growing at a rate of 15 percent a year. Between 2003 and 2005, annual imports from China increased by $92.2 billion, and from other parts of Asia by $41.0 billion. (So much for NAFTA allowing American firms to compete more effectively with the Japanese.)

The Hong Kong-based shipping company Hutchison Whampoa and retail giant Wal-Mart are partners in a new $300 million expansion of Mexico’s Pacific port of Lazaro Cardeñas to increase its annual handling capacity from 100,000 containers to 700,000 containers initially, with possible expansion to two million containers by the end of the decade. Hutchison Whampoa is run by billionaire Li Ka-shing, whose business empire is closely aligned with the Beijing regime.

In April, the American Chamber of Commerce in Guangdong, China conducted seminars to promote Lazaro Cardenas as a destination for good shipped from Chinese ports. At the Mexican port, shipping containers are loaded onto the Mexico–U.S. rail line operated by Kansas City Southern Railroad de Mexico. The containers do not clear U.S. Customs until they reach San Antonio. On October 24, 2005, the San Antonio Business Journal reported on a new agreement signed by U.S. and Mexican officials to allow for the movement of air, rail and ground cargo, through Mexico into the United States via KellyUSA – the industrial park created at the former Kelly Air Force Base in San Antonio, Texas. The report noted that the cargo would originate “principally from Asia and South America” – not Mexico.

Another deep water port just north of Lazaro Cardenas is Manzanillo. Situated between Acapulco and Puerto Vallarta, it caters primarily to cruise ships and tourists. But NASCO includes it in its future plans to expand trade shipments.

While American-based manufacturers will continue to suffer under the barrage of Chinese goods,Mexican industry and the hope of economic development south of the border will be smashed flat by what should be called a new Chinese Silk Road rather than a NAFTA highway. The goals of NAFTA for North American economic integration and development are being abandoned. The effect of expanded and modernized Mexican ports linked to the U. S. Midwest by new express routes is to allow China to jump over Mexico, kicking it in the face as it passes by.

Over 600 maquiladora’s, the assembly plants that sprang up along the U.S. -Mexican border to take advantage of NAFTA, have relocated to China, leaving 250,000 unemployed Mexican workers behind. Chinese interests also own factories in Mexico, which assemble imported components, rather than locally sourced parts, into products than are then exported to the United States. The new trade routes will allow these plants to expand at the expense of their competitors. In 2003, China passed Japan as the second largest exporter of goods, primarily components, to Mexico, behind the United States.

Chinese consumer goods also fill Mexican stores. The traffic in Mexican ports are as one-way as in American ports. In 2004, Mexico imported $9.1 billion worth of good from China, but sold China good worth only $1.9 billion in return. This deficit is similar to the U.S. trade ratio with China, which saw only $41.5 billion in exports against $244.6 billion in imports last year.

A fatalism has crept into Mexico, paving the way for acceptance of the new Chinese-focused investment in infrastructure. “Mexico had been the Number Two supplier to the U.S. [after Canada] within the context of the North American Free Trade Agreement” recalls Raul Rodriguez Barocio, manager of the North American Development Bank (NADB) in Mexico. “However, in 2003, Mexico was displaced by China and seems to have lost that position forever,” he laments. For Mexican industrialists, the Chinese invasion has been devastating, particularly for labor intensive industries such as footwear, toys, and garments. There is little chance for Mexican wages to rise if at $1.50 an hour they can be undercut by Chinese labor at 50 cents an hour, with the products rushed from Asia into the North American market.

Mexico has filed over 90 complaints against China at the World Trade Organization and has imposed anti-dumping duties. Mexico was the last country to approve Beijing’s membership in the WTO, fearing what China would do if given a “level playing field” subject only to its own mercantilist devices. But these efforts have been to no avail. Simon Levy-Dabbah, a foreign trade professor at the National Autonomous University of Mexico, epitomizes the defeatest attitude south of the border when he says that Mexican industrialists must get over their hatred and accept that China is “the factory for the world.” He suggests that Mexican firms form joint venture’s with Chinese business, “The Chinese only care about having their goods arrive into the United States. So what is needed now is for products from China and other Asian countries that do not have the required free trade agreements, to be able to use Mexican preferential tariffs to enter these markets.” In other words, if you can’t beat ‘em, join ‘em and hope for some small share of the spoils.

Charlie Banks, president of R. L. Banks & Associates, a transportation consulting company in Washington, told the L. A. Times (June 20) that Mexico is repositioning itself in a world in which its manufacturing base is eroding and its labor is considered relatively expensive by Asian standards. Part of that repositioning, Banks said, is as a logistics and supply chain corridor for goods heading to the United States. But “lift that bale, tote that barge” labor moving Chinese goods to Kansas will not enrich either Mexico or the United States, as real national wealth comes from production, not mere transport.

NAFTA was sold not just on the basis of trade, but as a means to lift Mexico out of poverty and to help establish democracy by creating a more affluent, optimistic polity. Such a development would improve U.S. security by fending off political radicalism and lessening the exodus of illegal immigrants. The same arguments were made last year during the debate over CAFTA, with the added note that an expanded trade bloc could protect regional industry from Chinese competition. As Rep. Bob Inglis (R-SC) said on the House floor during the CAFTA debate, “I stand here convinced that it is the best strategy available to combine with our neighbors to the south to compete with the Chinese.”

The new transport plans make a mockery of these arguments, as they are being constructed purely to help China improve its competitive advantage over all North and Central American commercial rivals. It is well past time to rethink the sophistry of “free trade” with China. Instead of spending billions of private and public funds aiding Chinese traders, a major effort should be launched to rebuild and expand the production base of North America. A key part of that effort would be to renegotiate NAFTA to create a true trade bloc that would drive Chinese goods off the continent, rather than into its heartland.

Bosque County Says ‘NO!’ To Corridor

By David Anderson
ASSOCIATE EDITOR
Clifton Record
July 21, 2006
CLIFTON — An estimated 400-plus packed the Clifton High School cafetorium Wednesday evening to issue a resounding “no thanks” to the Trans-Texas Corridor 35 running through Bosque County. An open house and public hearing hosted by the Texas Department of Transportation and the Texas Transportation Commission ran into the court still opposes the project, whether it comes through the county or not.
Verlie Edwards, chief of staff for District 58 State Rep. Rob Orr, spoke for the legislator, urging TxDOT to “listen closely, and slow down the process so all options are explored.” From there, the elected officials gave way to speakers from the general public, who one by one pled for the project’s elimination.
“No one has been able to give me a list of benefits of the corridor to Bosque County. I don’t believe it exists,” John Faubion said to applause from the crowd.
John Campbell asked anyone in the crowd of over 400 who supports the project to identify themselves, if they weren’t too afraid to.
No one stood, to laughter from the crowd.
As to the alternative route that could slice Bosque County in half, many pointed to the effects it would have on the landscape.
“Our rolling wooded hills, valleys, the abundant wildlife, the fertile soils. The attractions that brought the settlers here in 1854 remain the very essence of the county today,” Walt Lewis said.
“We’re known as the Top of the Hill Country,” Morgan Mayor Pro-Tem Keith Vandiver said. “Bringing the corridor through here would mean blasting the tops of many of our mesas. We don’t want to become known as the Flat-Top of the Hill Country.”
Jamie Finstad wanted to know what the state believes is “just compensation” for taking land and memories that has been in his family for 150 years.
“I wonder where all the wildlife that’s being displaced will go, and I wonder why we’re all in such a hurry,” Finstad continued.
“If we give it up (the land) now, it’s gone forever, and they’ll just want more later on,” Carl Aspen said.
“We haven’t adjusted yet to the second stop light in our county,” Judge Word jokingly remarked. “We’re not for one inch of the Trans-Texas Corridor in Bosque County. If we wanted to live in the Metroplex, we’d move there. We don’t want the Metroplex brought here.”
Several spoke to the corruption they believe underlies the Trans-Texas Corridor, and the lack of legislative action to end the project.
“Do you believe in communism or dictatorships? That’s what we appear to be headed for,” Sam Wells told the panel receiving the comments. “I hope TxDOT feels like General Custer, because the public is like Sitting Bull’s tribe, and we’ll do what we need to stop this. We won’t stand for somebody taking our land.”
“I’m appalled the state legislature has not stopped this. Our legislators have yet again turned a blind eye to the needs of this district,” said former Clifton Mayor W. Leon Smith.
“It gives me heartburn to think we’ll build a toll road and send the money to a company in Spain,” said David Pieper, adding that the state is diverting billions of dollars that should be earmarked for transportation improvements to other uses.
“This is not progress,” said Martha West. “It’s prostitution of our great state, and with filthy money.”
Aspen, who said he spoke with a TxDOT official before the public hearing, was not surprised at a comment he received.
“He told me, ‘We don’t want to hear, “Not in my back yard.”’
“Of course, he also told me the corridor won’t affect him where he lives,” Aspen added.
Many testifying suggested that, if the infrastructure is built, the name should be changed. Suggestions ranged from “The Corridor of Regret,” to the “Trans-Texas Horror-Door,” to “Ben Dover.”
Other concerns centered on the facilities being outdated before they are finished, especially considering quantum leaps in technology from year to year.
“It’s like trying to build a better manual typewriter,” Smith told the commission.
While many of those who spoke addressed generations of families that have lived in the county who will lose land should the corridor be brought through, others told of being proud transplants to the county, including Ron Harmon, Les Bowers, and David Anderson.
One by one, most of those testifying put the onus on the state’s legislators. Many said it was past time to send them comments. Most said it was time to send them home by voting them out in the next election.
“House Bill 3588 passed, effectively, unanimously, so they all need to go,” said Linda Curtis, founder of Independent Texans. “We need to get organized, and tell them where to put this corridor.”
Harmon agreed, saying Texas needs to get rid of any politician who supports or does not specifically oppose the TTC.
TxDOT’s officials remained after the public hearing to answer questions, but most of the crowd began filing out of the cafetorium as the public testimonies came to end, apparently having heard enough.

Link to article here.

CFR’s Plan to Integrate the U.S., Mexico and Canada

——————
by Phyllis Schlafly
Eagle Forum
July 13, 2005
——————-
The Council on Foreign Relations (CFR) has just let the cat out of the bag about what’s really behind our trade agreements and security partnerships with the other North American countries. A 59-page CFR document spells out a five-year plan for the “establishment by 2010 of a North American economic and security community” with a common “outer security perimeter.”

“Community” means integrating the United States with the corruption, socialism, poverty and population of Mexico and Canada. “Common perimeter” means wide-open U.S. borders between the U.S., Mexico and Canada.”Community” is sometimes called “space” but the CFR goal is clear: “a common economic space … for all people in the region, a space in which trade, capital, and people flow freely.

“The CFR’s “integrated” strategy calls for “a more open border for the movement of goods and people.” The CFR document lays “the groundwork for the freer flow of people within North America.” The “common security perimeter” will require us to “harmonize visa and asylum regulations” with Mexico and Canada, “harmonize entry screening,” and “fully share data about the exit and entry of foreign nationals.”

This CFR document, called “Building a North American Community,” asserts that George W. Bush, Mexican President Vicente Fox, and Canadian Prime Minister Paul Martin “committed their governments” to this goal when they met at Bush’s ranch and at Waco, Texas on March 23, 2005.

The three adopted the “Security and Prosperity Partnership of North America” and assigned “working groups” to fill in the details.It was at this same meeting, grandly called the North American summit, that President Bush pinned the epithet “vigilantes” on the volunteers guarding our border in Arizona.

A follow-up meeting was held in Ottawa on June 27, where the U.S. representative, Homeland Security Secretary Michael Chertoff, told a news conference that “we want to facilitate the flow of traffic across our borders.” The White House issued a statement that the Ottawa report “represents an important first step in achieving the goals of the Security and Prosperity Partnership.”

The CFR document calls for creating a “North American preference” so that employers can recruit low-paid workers from anywhere in North America. No longer will illegal aliens have to be smuggled across the border;employers can openly recruit foreigners willing to work for a fraction of U.S. wages.Just to make sure that bringing cheap labor from Mexico is an essential part of the plan, the CFR document calls for “a seamless North American market” and for “the extension of full labor mobility to Mexico.”

The document’s frequent references to “security” are just a cover for the real objectives. The document’s “security cooperation” includes the registration of ballistics and explosives, while Canada specifically refused to cooperate with our Strategic Defense Initiative (SDI).

To no one’s surprise, the CFR plan calls for massive U.S. foreign aid to the other countries. The burden on the U.S. taxpayers will include so-called “multilateral development” from the World Bank and the Inter-American Development Bank, “long-term loans in pesos,” and a North American Investment Fund to send U.S. private capital to Mexico.

The experience of the European Union and the World Trade Organization makes it clear that a common market requires a court system, so the CFR document calls for “a permanent tribunal for North American dispute resolution.” Get ready for decisions from non-American judges who make up their rules ad hoc and probably hate the United States anyway.

The CFR document calls for allowing Mexican trucks “unlimited access” to the United States, including the hauling of local loads between U.S. cities. The CFR document calls for adopting a “tested once” principle for pharmaceuticals, by which a product tested in Mexico will automatically be considered to have met U.S. standards.

The CFR document demands that we implement “the Social Security Totalization Agreement negotiated between the United States and Mexico.” That’s code language for putting illegal aliens into the U.S. Social Security system, which is bound to bankrupt the system.

Here’s another handout included in the plan. U.S. taxpayers are supposed to create a major fund to finance 60,000 Mexican students to study in U.S. colleges.

To ensure that the U.S. government carries out this plan so that it is “achievable” within five years, the CFR calls for supervision by a North American Advisory Council of “eminent persons from outside government . . . along the lines of the Bilderberg” conferences.

The best known Americans who participated in the CFR Task Force that wrote this document are former Massachusetts Governor William Weld and Bill Clinton’s immigration chief Doris Meissner. Another participant, American University Professor Robert Pastor, presented the CFR plan at a friendly hearing of Senator Richard Lugar’s Foreign Relations Committee on June 9.

Ask your Senators and Representatives which side they are on: the CFR’s integrated North American Community or U.S. sovereignty guarded by our own borders.

Think the merging of North America is all hype? Feast your eyes on this!

As published in this week’s Plain Talk from the Texas Hill Country newsletter by Jim McGrody

Overview of SB 3622
On June 29, 2006, Sen. John Cornyn (R-TX) introduced SB 3622 – a bill to authorize the creation of the North American Investment Fund between the governments of Canada, Mexico, and the United States to increase the economic competitiveness of North America in a global economy.

The purpose of the bill shall be:

• to increase the economic competitiveness of North America in a global economy
• to reduce the income gap between Mexico and Canada, and between Mexico and the United States
• to promote economic development in Mexico in the areas of infrastructure, education, technology, and job training
In general, grants shall be awarded from the Fund for projects to carry out the purposes of the Bill, including projects-
• to construct roads in Mexico to facilitate trade between Mexico and Canada, and Mexico and the United States
• to encourage the development and improve the quality of primary, secondary, and post-secondary education throughout Mexico
• to expand the deployment of communications and broadband infrastructure throughout Mexico, with emphasis on rural and underserved areas and, to expand job training and workforce development for high-growth industries in Mexico.

The agreement shall require the governments of Canada, of Mexico, and of the United States to contribute to the Fund. Canada and the United States will contribute to the Fund if the Government of Mexico – increases the tax revenue collected by such Government, with the goal of annually collecting an amount of such revenue that is equal to 18 percent of the annual gross domestic product of Mexico; and carries out a program of reforms to increase private investment and economic growth, reduce poverty, and maintain economic stability in Mexico.
You can read the complete bill by clicking here…

Background Reading – The Council On Foreign Relations
North America is vulnerable on several fronts: the region faces terrorist and criminal security threats, increased economic competition from abroad, and uneven economic development at home. In response to these challenges, a trinational, Independent Task Force on the Future of North America has developed a roadmap to promote North American security and advance the well-being of citizens of all three countries.

When the leaders of Canada, Mexico, and the United States met in Texas recently they underscored the deep ties and shared principles of the three countries. The Council-sponsored Task Force applauds the announced “Security and Prosperity Partnership of North America,” but proposes a more ambitious vision of a new community by 2010 and specific recommendations on how to achieve it.

Read the complete background on the Council on Foreign Relations.

Read Eagle Forum’s dissenting opinion here.

This information is taken from a news release in 2000 when Cintra-Macquarie acquired an airport in Bristol, England. This information was compiled prior to Cintra-Macquarie acquiring the Chicago Skyway toll road (January 2005), the Indiana Toll Road (Spring 2006), before they gained the development rights for the Trans Texas Corridor (2005), and before becoming the only bidders for the San Antonio toll starter system (2005). Do we really want America to come under the control of multi-national corporations (perhaps more accurately, quasi-governments)?

About Cintra
Cintra is an international infrastructure company based in Spain which develops, owns and operates transport assets worldwide. Cintra is currently ranked as the world’s largest infrastructure developer by value of investment and, over the last three years it has been ranked as the second largest developer of transport based infrastructure in the world by number of concessions. It is a subsidiary of Grupo Ferrovial, one of the leading industrial groups in Spain and listed on the Spanish Stock Exchange.

Cintra owns and operates transport based assets on a world-wide basis. It has three primary businesses; airports, toll-roads and car parks. Cintra currently has eleven airports in Southern Mexico, the Antofagasta airport in Chile and Niagara Falls airport in New York State, handling over 12 million passengers. In addition to being an investor in those airports, Cintra provides an extensive range of operational and management support to them.

Cintra also owns and operates toll roads in Spain, Canada, Portugal, Chile and Colombia and manages over 130,000 car parking spaces in Spain, Portugal and Puerto Rico.

Then here’s more info about the majority owner of Cintra, Grupo Ferrovial, from the Hoover’s financial web site:

When in Spain, trains, planes, and automobiles travel by Grupo Ferrovial. One of Spain’s largest engineering and construction firms, Ferrovial also provides housing and community development, toll road and car park management, and environmental and telecommunications services. Ferrovial Agromán is the group’s main construction unit. Projects include commercial and residential construction to road, rail, energy, and airport infrastructure development. Through its Cintra stake Ferrovial has concessions interests in toll roads, car parks, and airports. It has taken over UK services group Amey and owns more than 28% of British airports operator BAA. Founder Rafael del Pino y Moreno and his family control Ferrovial.

About Macquarie
Macquarie is Australia’s leading investment bank, with total assets in excess of £9.4 billion, and a further £14.9 billion in funds under management and administration. It is listed on the Australian Stock Exchange and ranks as one of Australia’s largest 30 companies by market capitalisation.

Macquarie has over 4,000 staff in offices throughout Australia and in 22 locations throughout the world, including the United Kingdom. Macquarie’s second largest office outside Australia is located in London.

Macquarie is at the forefront of the infrastructure sector, both in Australia and internationally, and has one of the largest and most successful infrastructure businesses in the world. Macquarie manages infrastructure funds and investments in projects in the UK and Europe valued at nearly £3 billion.

Macquarie has a unique combination of strategic, commercial and financial expertise in the airport sector.

As part of a long-term strategy to build a significant global airport business, Macquarie strengthened its airport business expertise through the acquisition in October, 2000 of The Portland Group, the UK’s leading airport management consultancy.

See the World Net Daily article here: http://www.wnd.com/news/article.asp?ARTICLE_ID=51113 or read below.

Just when you think it couldn’t get worse, it does. Now our airlines are up for grabs to foreign ownership as we’ve reported here (http://satollparty.com/post/?p=54 and http://satollparty.com/post/?p=155). The media wouldn’t cover the foreign management of our highways during the Dubai port deal, but this may help us reach critical mass to sink this trend once and for all!

Foreign ownership of U.S. airlines?
Bush ready to defy Congress’ ban despite pilots’ fears of another Dubai ports deal

By Jerome R. Corsi
July 18, 2006
© 2006 WorldNetDaily.com

The Department of Transportation, acting under President Bush’s orders, is preparing to issue an administrative ruling that would open U.S. airlines up to foreign ownership, despite specific prohibitions and warnings from Congress, as well as predictions by pilots that another Dubai ports controversy is in the offing.The proposed ruling puts the Air Line Pilots Association, or ALPA – the largest airline pilot union in the world representing 61,000 pilots who fly for 40 U.S. and Canadian airlines – at odds with the Bush administration.

The administration is determined to comply with European Union demands presented in the November 2005 “open skies” negotiations. (So-called “open skies” agreements are bilateral or multilateral agreements that liberalize the rules for international aviation markets and minimize government intervention.)

The EU is threatening to delay the signing of an open skies treaty unless the U.S. changes restrictions on the percentage of a U.S. airline that can be foreign-owned. The U.S. currently has 74 bilateral open skies agreements, none of which require any rule changes on the foreign ownership of U.S. airlines.

ALPA is encouraging pilots to write letters and e-mails of protest to Congress, newspapers and national television and radio outlets.

“Do not underestimate the seriousness of this issue!” ALPA has advised, “This is do-or-die, sink-or-swim time.”

Some U.S. pilots who have spoken with WND on condition of anonymity expressed concern about job reprisals.

The pilots have argued another Dubai Ports World-type controversy is brewing in which the “Bush administration does not care about selling out key U.S. assets to foreigners.” ALPA calls for action echo the alarm:

The writing is clearly on the wall! This Administration wants foreign investors, airlines or otherwise, to pay for the costs of our aviation infrastructure, while risking hundreds of thousands of aviation jobs, the Civil Reserve Air Fleet program (CRAF), and the safety and security of our national airspace. Forty percent of all Air Force Reserve and National Guard pilots are also airline pilots.

ALPA believes the foreign-ownership issue is a fight for survival:

The time to act is now! Together, with every pilot across this country participating in this effort, we can stop this rogue attack on our profession and our industry. There is no issue more important than preventing this NPRM (Notice of Proposed Rulemaking) from moving forward. If the White House is successful in changing the foreign ownership rules through DOT affirmative action, within just a few short years our industry will mirror the maritime industry. Our jobs will no longer exist, our country’s ability to militarily act abroad will be handicapped, and our families may no longer be safe in our own airspace!

On June 14, in an official statement of administration policy, the Office of Management and Budget in the executive office of the president put out a notice that the Department of Transportation intended to change the foreign ownership rule by issuing a new administrative rule:

To counter the Bush administration, five congressmen wrote a letter eight days later, June 22, to DOT Secretary Norman Mineta on U.S. House of Representatives Committee on Transportation and Infrastructure stationary.

In citing specific congressional prohibitions, the letter noted Congress had taken two specific actions to put the White House on notice that “a major change to the current law regarding foreign ownership of U.S. airlines should be accomplished only by congressional action, not unilaterally imposed by the executive branch.”

The letter cited the following congressional prohibitions:

First, the Conference Report on H.R. 4939, Making Emergency Supplementary Appropriations for the Fiscal Year Ending September 30, 2006, includes ‘language preventing the Secretary from issuing a final rule regarding foreign control of U.S. airlines for 120 days.’ Second, during consideration of H.R. 5576 – the Transportation, Treasury, Housing and Urban Development, the Judiciary, the District of Columbia, and Independent Agencies Appropriations Act for Fiscal Year 2007 (TTHUD appropriations), the House adopted, by an overwhelming vote of 291 to 137, an amendment prohibiting the department from finalizing or implementing the policy proposed in the rulemaking during the next fiscal

Signing the letter were Reps. Duncan Hunter, R-Calif.; chairman of the Armed Services Committee; Frank A. LoBiondo, R-N.J.; chairman on the Coast Guard and Maritime Transportation Subcommittee; Ted Poe, R-Texas; James L. Oberstar. D-Minn., ranking Democratic member on the Transportation and Infrastructure Subcommittee; and Jerry F. Costello, D-Ill., ranking Democratic member of the Subcommittee on Aviation.

A major proponent of the rule change has been Under Secretary of Transportation Jeffery Shane, who was quoted on a government Web site in April suggesting Mineta remains “committed to completing this important rulemaking procedure.”

Shane also noted the proposed rule “has been the focus of far more controversy in the U.S., frankly, than we had anticipated.”

http://www.cbsnews.com/stories/2006/07/15/ap/business/mainD8ISHMO00.shtml

This article states that there has largely been no “resistance” to the selling/leasing of our highways to foreign companies. Nothing could be further from the truth! We’re building a statewide coaliton of more than a dozen groups opposed to the Governor’s plans to toll and privatize our public freeways, not to mention the tens of thousands of grassroots Texans this coalition represents. What’s interesting to note is that this article states “few people” know about a foreign company getting the tolls for a U.S. tunnel that connects to Canada and a bridge in Alabama, yet later on the article claims there is no opposition. Perhaps because people aren’t aware of what’s happening under their noses? When they find out, there’s almost universal opposition!

Then, Mr. Poole of yet another conservative think tank on the toll bandwagon thinking monpolies are somehow “free market,” actually admits privatization is good because they have the motivation to raise tolls and “de-politicize” TAXATION! Since when it is OK to de-politicize TAXATION? Tolls are quintessentially political because it involves the government’s power to forcibly take citizens’ money through taxation, and in this case, they’re handing that power to levy taxes to foreign companies! TAXATION should always be tied to TAXPAYERS, not private companies whose primary purpose is to make a profit. This is the ideology that’s pushing our country headlong down the road of unlimited taxation and foreign control of our public infrastructure!

Texas & Indiana citizens took the government to court!
People for Efficient Transportation (PET, legal arm of Texas Toll Party) took the Texas Department of Transportation and the Federal Highway Administration to court to stop the tolling of US 281 (http://satollparty.com/post/?p=49), which did stop it temporarily. Also, Indiana citizens tried to block the sale of the Indiana Toll Road in court (http://www.masson.us/blog/?p=1376). A poll before the sale showed an overwhelming number of Indianans opposed the sale (http://satollparty.com/post/?p=169).

So to say there is no opposition like there was over the port deal, just isn’t true. It seems isolated in certain states at the moment, but there is growing national opposition as well (see Jerome Corsi’s series on World Net Daily here: http://satollparty.com/post/?p=305 as well as a series in the Denver Post here: http://satollparty.com/post/?p=278). If the public truly knew even half of what’s going on, there’d be another political firestorm like the Dubai flap only tenfold!

“Toller” talking points
Much of what was in your article are familiar “talking points” that we’ve heard from the pro-tollers. However, when you start to scrutinize what they claim, their reasons for widespread privatization and tolling breakdown. For instance, the article mentions driving (or usage) of highways went up 94% but that new capacity only rose 6%. Well, that 94% increase in driving also translates into more gas tax revenue. In Texas, our state gas tax revenue has outpaced inflation and population growth by more than three times in the last 20 years! It’s hard for the federal government to have a shred of credibility in saying they’re out of money for roads when last year’s federal highway bill had over 6,000 earmarks including a bridge to nowhere in Alaska (http://satollparty.com/post/?p=170).

In San Antonio, we added more lane miles of freeway between 1990 and 2000, but commute times went up. There is not necessarily a correlation between building more roads and congestion relief. Planning is a key element. A former City Planner for San Antonio blasted TxDOT’s toll plans saying it’s a lack of planning, not lack of funds that led to congestion (http://satollparty.com/post/?p=252). San Antonio ranks number 5 in lane miles per person in the country, and yet the highway lobby would have us believe there is a transportation crisis requiring another $16 billion (that’s $10,000 from every man, woman, and child) in additional taxes in San Antonio alone over the next 20 years to build more roads or else!

We have congestion in isolated areas, but when you look at the national average commute time for the last several decades, it remains around 25 minutes. There’s a host of misleading figures that both the government and the highway lobby put out that make it appear as though the sky is falling. With people now driving less due to the steady rise in transportation costs, the tollers’ arguments become less relevant and more empty every day!

Foreign Companies Buy U.S. Roads, Bridges

Foreign companies are buying up American highways and bridges built by U.S. taxpayers

WASHINGTON, Jul. 15, 2006
By LESLIE MILLER

Associated Press Writer

(AP) Roads and bridges built by U.S. taxpayers are starting to be sold off, and so far foreign-owned companies are doing the buying.On a single day in June, an Australian-Spanish partnership paid $3.8 billion to lease the Indiana Toll Road. An Australian company bought a 99-year lease on Virginia’s Pocahontas Parkway, and Texas officials decided to let a Spanish-American partnership build and run a toll road from Austin to Seguin for 50 years.Few people know that the tolls from the U.S. side of the tunnel between Detroit and Windsor, Canada, go to a subsidiary of an Australian company – which also owns a bridge in Alabama.Some experts welcome the trend. Robert Poole, transportation director for the conservative think tank Reason Foundation, said private investors can raise more money than politicians to build new roads because these kind of owners are willing to raise tolls. “They depoliticize the tolling decision,” Poole said. Besides, he said, foreign companies have purchased infrastructure in Europe for years; only now are U.S. companies beginning to get into the business of buying roads and bridges.Gas taxes and user fees have fueled the expansion of the nation’s highway system. Thousands of miles of roads built since the 1950s changed the landscape, accelerating the growth of suburbia and creating a reliance on motor vehicles to move freight, get to work and take vacations.In 1956, President Eisenhower pushed to create the interstate highway system for a different: to move troops and tanks and evacuate civilians.The Bush administration’s plan to let a foreign company manage U.S. ports met a storm of protest in February. But plans to sell or lease highways to companies outside the United States have not met such resistance.

John Foote, senior fellow at Harvard’s Kennedy School of Government, said the government can take over a highway in an emergency. But he objects to selling roads to raise cash.

But that is just what Chicago has done.

Last year, the city sold a 99-year lease on the eight-mile Chicago Skyway for $1.83 billion. The buyer was the same consortium that leased the Indiana Toll Road _ Macquarie Infrastructure Group of Sydney, Australia, and Cintra Concesiones de Infraestructuras de Transporte of Madrid, Spain.

Chicago used the money to pay off debt and fund road projects. Skyway tolls rose 50 cents, to $2.50; By 2017, they will reach $5.

The Indiana Toll Road lease is a better deal, Foote thinks, because the proceeds will pay for urgent projects such as road and bridge improvements.

That need is precisely why cities and states have begun to look to foreign investors.

Between 1980 and 2004, people drove 94 percent more highway miles, according to Federal Highway Administration statistics. But the number of new highway lane miles rose by only 6 percent.

Washington is not likely to produce more money to build roads. The federal highway fund – which will have a balance of about $16 billion by the end of 2006 – will run out in 2009 or 2010, according to White House and congressional estimates.

About half the states now let companies build and operate roads. Many changed their laws recently to do so.

So Illinois lawmakers are examining privatizing the Illinois Tollway, New Jersey lawmakers are considering selling 49 percent of the state’s two big toll roads and a gubernatorial candidate in Ohio wants to sell the turnpike.

Indiana Gov. Mitch Daniels, who championed his state’s toll road deal, now wants investors to build and operate a toll road from Indianapolis to Evansville.

Patrick Bauer, the Indiana House’s Democratic leader, says such deals are taxpayer rip-offs.

Bauer believes Macquarie-Cintra could make $133 billion over the 75-year life of the Indiana Toll Road lease – for which Indiana got $3.8 billion.

“In five, maybe 10 years, all that money is gone, and the tolls keep rising and the money keeps flowing into the foreign coffers,” Bauer said.

Orange County, Calif., got burned by a toll-road lease for a different reason.

The road, part of state Route 91, was built and run for $130 million by California Private Transportation Company, partly owned by France-based Compagnie Financiere et Industrielle des Autoroutes. The toll road opened in 1995.

Seven years later, Orange County was looking at gridlock. But it could not build more roads because of a provision in the lease. So it bought back the lease – for $207.5 million.

To encourage more domestic investment in highways, former Transportation Secretary Norman Y. Mineta made a pitch to Wall Street on May 23.

“The time is now for United States investors _ including our financial, construction and engineering institutions _ to get involved in transportation investments,” said Mineta, who left office July 7.

U.S. companies are getting the message.

San Antonio-based Zachry Construction Co., along with Cintra, received approval on June 29 for a 50-year lease to build and run a toll road from Austin to Seguin for $1.3 billion.

That is part of Texas Gov. Rick Perry’s vision to attract more than $80 billion in private funds for roads by 2030. He wants a new tollway from Oklahoma to Mexico and the Gulf Coast, and one from Shreveport, La., and Texarkana to Mexico. Cintra-Zachry reached a $7.2 billion deal last year to develop the project’s first phase.

Not everyone in Texas buys the idea. Harris County officials recently voted against selling three toll roads. Also, independent gubernatorial candidate Carole Keeton Strayhorn opposes Perry’s toll road plan.

“Texas freeways belong to Texans, not foreign companies,” she said.

Read about www.spp.gov here. For more disturbing information, go to the North America’s Supercorridor Coalition (or NASCO, which our Texas Transportation Commission is a member and the congressional caucus extension of NASCO is where a Bell County Commissioner, Tim Brown, is President) web site www.nascocorridor.com (particularly this page endorsing Perry’s Trans Texas Corridor) and to www.amerocurrency.com.

Dr. Jerome Corsi has written a series of articles putting this partnership in perspective, including how it relates to Perry’s push for toll roads:
Bush quietly orchestrates a NAFTA superhighway from TX to Canada
Docs reveal plan for Mexican trucks in U.S.
Coming soon to U.S.: Mexican customs office
Kansas City Customs Port considered Mexican soil?
Tancredo confronts ‘superstate’ effort
Bush sneaks in ‘superstate’ without oversight?

Link to editorial here.

Feds Encourage Foreign Control of U.S. Interstates
By Diane M. Grassi
The Hawaii Reporter
6/27/2006

Fifty years ago, President Dwight D. Eisenhower signed into law the 1956 National Federal-Aid Highway Act and since 1990 referred to as the Dwight D. Eisenhower System of Interstate and Defense Highways. He authorized the connectivity of 41, 000 miles of high quality highways across the United States. It would be financed by a combination of the Highway Trust Fund, federally imposed user fees on motor fuels and state user fees.

Eisenhower was prompted to persuade the nation’s people to build the interstate system, as a matter of national security. Although not at war at the time, he believed it was imperative the interstate be designed for mass evacuation of cities in the event of a nuclear attack, in the era of the Cold War. The Act dictated that one out of every five miles must be straight, in order to use as airstrips in times of war or other catastrophic emergencies. And to that end, the success of national defense was dependent upon the navigability of large numbers of military personnel and their equipment during such a crisis. And even today, 75% of the interstate highway system represents the Strategic Highway Corridor Network (STAHNET) utilized by the U.S. military.

And while in 1956 there was the fear of nuclear threat from the then Soviet Union, today’s national security, often referred to as homeland security, remains similarly threatened in an era where the threat of terrorism looms. Yet, at such time that it would appear imperative that U.S. strategic infrastructure such as the interstate highway system remain under American control, it is but one more public asset available for sale under the guise of Public-Private Partnerships. Unlike domestic privatization, however, states throughout the country are negotiating contracts solely with foreign corporations and conglomerates, primarily in Europe, Australia and Asia, in order to finance the maintenance, modernizing and extension of U.S. interstates.

As funding from federal gas taxes and state user fees have fallen behind the inflated costs associated with road construction and maintenance, more and more state governors and lawmakers no longer see the operation of roads solely as a public responsibility. However, the reason states initially took over handling roads at the beginning of the 19th century was because many roads, bridges and canals had previously fallen to bankruptcy in the hands of private owners.

According to the Secretary of the Department of Transportation, Norman Mineta, “We are like a poker game. We are inviting people to the table and saying, ‘Bring money when you come.’” And Mineta believes, “A big part of the answer is to involve the private sector more fully – not just as a contractor or vendor, not merely as a financier, but as a partner in the funding, management and expansion of our transportation infrastructure.” Yet when those partners are exclusively foreign entities, a whole new dimension is added to the management of the U.S. interstate highway system. It is unprecedented.

The deal which started a flurry of more than 18 proposed foreign financed interstate highway projects across the nation over the past year in amounts of over $25 billion was in Chicago, IL in December 2004. Chicago Mayor Richard Daley proposed an agreement to lease the Chicago Skyway for $1.83 billion dollars to Cintra-Macquarie Consortium, a Spanish-Australian conglomerate, doing business as State Mobility Partners in the U.S. The deal, finalized in January 2005, gave Cintra-Maquarie a 99-year lease for which it is responsible for the maintenance and structural quality of the 8-mile elevated structure. -1- -2- In exchange for its upfront payment, Cintra-Macquarie will collect and keep all money from tolls from the Skyway and will be able to raise tolls as incorporated under the terms of the agreement. The company is modernizing toll collection with an electronic transponder system. Until the technology is fully operable, toll collectors have been newly but temporarily recruited. But instead of earning an average hourly wage of $20.00 as their predecessors did, they are paid a $10.00 to $12.00 hourly wage. And as contracted, the Skyway offers the buyer an asset without having to deal with improvements or debt.

Following the situation in Chicago, Indiana Governor and former Office of Management and Budget Director for President Bush in his first term, Mitch Daniels, explored a similar arrangement for Indiana’s $2.8 billion shortfall in its transportation budget over the next ten years. Daniels was able to get his highly contested proposal through the state legislature as well as the courts where it was challenged by a citizen advocacy organization.

A bid was accepted by the state of Indiana in the amount of $3.8 billion and an agreement was arrived at with Cintra-Macquarie, the same operator of the Chicago Skyway. The lease agreement will provide for the operation and maintenance of the 157-mile Indiana Toll Road, a part of the interstate highway system, for a period of 75 years. The deal is expected to close on June 30, 2006. The Indiana Toll Road will also have an upgraded electronic toll system installed, eventually ending the need for toll workers.

Here are just a few of the many other projects either approved or proposed across the country. In Virginia, the rights to manage, operate and maintain the Pocahontas Parkway, an 8.8-mile toll road outside of Richmond, were bought for $611 million by the Transburban Group, also an Australian entity in its first foray into U.S. road management. A lawmaker in New Jersey has proposed selling a 49% interest in the New Jersey Turnpike and Garden State Parkway to a private investor.

In August 2005, the same Macquarie Infrastructure Group took over operations of the Dulles Greenway Toll Road which operates between suburban Virginia and Washington, D.C., for the amount of $533 million. And the anticipated widening and extension of the Trans-Texas Corridor which runs 316 miles and parallel to I-35 in Texas, is slated to be built by Cintra, the Spanish company, and Zachry Construction, out of San Antonio, TX, who plan to invest $7.2 billion.

But windfall upfront payments while attractive to states to reinvest in other transportation projects, have their limitations and pitfalls too. States will need to learn how to enforce and write explicit contracts. And the proceeds from the sale or lease of roads should be earmarked for specific projects. Non-compete clauses are often inserted in such contracts such as inducing lower speed limits on parallel free roads to drive traffic to the toll road. Others fear that operators will only maintain those parts of the route which remain profitable.

Other issues which are arising more often after the fact is the increasing worry that the public will have less and less input over the use of its public assets. Such is the case in Colorado and California where the enforcement of maintenance matters have already become problematic. Immediate increases in tolls and applied on a perennial basis, with higher tolls applied at rush hours have not sat well with commuters.

However, questions will continue to arise in a process still in its in infancy. Yet states must have the ability to learn from mistakes made in doing business in this brand new way. Will a private firm maintain the roadways as well as the U.S. government? Will a foreign corporation care about the needs of the American people? And will selling off public assets to pay debts now be regrettable down the road? One would think that Eisenhower would have thought so.

Link to article here.

THE NEW WORLD DISORDER
Mexican trucks to enter U.S. freely?
Bush administration refuses to answer WND’s questions
By Jerome R. Corsi
June 27, 2006

A U.S. government agency has begun a new audit to determine if the Bush administration has resolved inspection issues that would allow Mexican trucks to enter the U.S. freely.

David Barnes, a spokesman for the Office of Inspector General within the U.S. Department of Transportation confirmed to WND a new audit was begun in March 2006 on action by the Federal Motor Carrier Safety Administration.

Barnes said he could not speculate on the outcome of the new study or on whether FMCSA had made any progress working out on-site safety inspection requirements with Mexico.

Despite repeated calls, WND received no comment from the office of Transportation Secretary Norman Mineta.

The issue draws heightened significance in light of the North American Free Trade Agreement super-highway plans being developed by the Trans-Texas Corridor project. Next month, the Texas Department of Transportation plans to hold the final public hearings on the plan to build a super-highway up to four football fields wide, paralleling I-35, from the border with Mexico at Laredo, Texas, north to the Texas-Oklahoma border. The Texas DOT expects to have final federal approval by the summer of 2007, with construction of the first super-highway segment to begin shortly thereafter.

Also, as WND has reported, the Kansas City SmartPort plans to open a Mexican customs office as part of their “inland port” along I-35. A brochure on the website of the Kansas City SmartPort makes clear that the ultimate plan is to utilize deep-sea Mexican ports, such as Lazaro Cardenas, to unload containers from China and the Far East. The containers will then be brought into the U.S. by Mexican railroads and Mexican trucks, all headed north to Kansas City, where the containers could continue north or be routed east or west, as needed.

Since before the passage of NAFTA, a decision to allow Mexican trucks into the U.S. on a non-restricted basis has been hotly contested.

On June 7, 2004, the U.S. Supreme Court reached a unanimous decision in Department of Transportation v. Public Citizen, ruling that Mexican trucks under NAFTA could enter the U.S. freely, even if the Mexican trucks failed to meet environmental standards as set by state and federal law.

The decision effectively lifted a 1982 U.S. decision to ban Mexican trucks from U.S. roads, except for a 20-mile zone near the border. The ban had been kept in place by the Clinton administration, despite the passage of NAFTA in 1994, with provisions specifying that the Mexican truck moratorium would be lifted.

Still, thousands of Mexican trucks have not started rolling across the border yet. Why not?

The answer lies with the Federal Motor Carrier Safety Administration in the Department of Transportation. According to Section 350 of the Fiscal Year 2002 DOT appropriations act, the FMCSA must first certify that Mexican trucks applying for cross-border entry into the U.S. are safe for long-haul operations.

An Office of Inspector General audit published Jan. 3, 2005, indicating the FMCSA had not implemented the on-site inspections in Mexico.

As of September 2004, FMCSA had received applications from 678 Mexican motor carriers seeking long-haul authority to operate about 4,000 vehicles. This was up from 232 carriers that had applied as of March 2003, seeking authority to operate about 1,400 long-haul vehicles.

“Still, the procedures for FMCSA to conduct on-site safety reviews have not been worked out with Mexico under the terms of NAFTA,” the January 3, 2005, OIG report noted.

Teamsters opposition

The Teamsters Union has fought NAFTA since the 1990s, concerned that the ultimate plan was to undermine union trucking as well as independent truckers who are owner-operators.

“With all the obstacles that still need to be overcome, our government must heed the OIG’s warnings from the January 2005 audit,” Galen Munroe, a spokesperson for the Teamsters Union told WND in an email. “The motor carriers in Mexico need to adhere to the same regulations and standards that our companies and drivers are subject to. Unfortunately, this seems to be a near impossible task with Mexico’s current infrastructure.”

The safety hazards being scrutinized by the FMCSA are in addition to ongoing environmental concerns. Commenting on the 2004 Supreme Court decision in Department of Transportation v. Public Citizen, legal analyst Noah Sachs noted the adverse consequences likely to follow this decision:

As a result of the ruling, thirty thousand or more Mexican trucks – which are generally older, more polluting, and less safe than their U.S. counterparts – will be allowed to conduct long haul trucking operations to locations across the United States. Recent government studies estimate that eighty to ninety percent of the Mexican truck fleet was manufactured before 1994. In a preliminary environmental review, FMCSA concluded that their emissions “can be expected to translate into incremental increases in premature deaths” and “an enhanced incidence of respiratory diseases” in the United States. A 2002 U.S. EPA study reported a “persuasive” link between inhalation of diesel exhaust and cancer.

Meanwhile, the last remaining barriers to the open entry of Mexican trucks into the U.S. seems to be finalizing procedures for on-site safety inspections in Mexico prior to authorizing Mexican truck operators for long-haul entry into the U.S.

The results of the March 2006 OIG audit will indicated whether FMSCA has made any progress resolving these issues with Mexico in the past year.

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