1 CROSSROADS OF THE AMERICAS: THE TRANS-TEXAS CORRDOR HONG, LYNCH, RAMIC CE 5212 Background The processes of globalization and economic integration are changing the economic, social and political characters of Texas, the United States, and North America as a whole. While the improvement of transportation technology played a significant role to make these changes possible, the 1989 Canada-U.S. Free Trade Agreement (FTA) and the North American Free Trade Agreement (NAFTA), which included Mexico as well, were the deliberate policy choices for those changes. Canada, the United States, and Mexico each pursued their transportation policies based on their own individual economic and political requirements, and the continental transportation system was constructed in three pieces with minimal interaction. Examination of the history of national transportation policies for these three countries illustrates that the conditions of the network expansion, whether rail or highway, has tended to reinforce the existing structure rather than reorient it. Canada The first national transportation policy in Canada was made when policy makers recognized that the trade and economic policies needed to be linked to the transportation policy to make them successful. In 1879, the policy of building the first Canadian transcontinental rail line, the Canadian Pacific Railway (CPR), had the strong political overtone of uniting the country into confederation. It entrenched the national transportation network into a primarily east-west pattern. (Bradbury, 2002.) This east-west transportation pattern continued to evolve through the construction of the national highway system. Begun in 1949, the TransCanada highway (TCH) was designed to add to the CPR routes and link the country together with an efficient highway. Completed in 1970, the highway system binds the heartland of manufacturing in the country with the places resources were located, as well as the markets of the east and west. The Canadian2 CROSSROADS OF THE AMERICAS: THE TRANS-TEXAS CORRDOR HONG, LYNCH, RAMIC CE 5212 transportation system developed along this initial network and remained unchanged until the 1980s. In 1988, the Free Trade Agreement was signed by Canada and the United States. It removed several trade restrictions over ten years and resulted in a significant increase in cross-border trade. When the agreement was announced, it became controversial in Canada. Also the 1988 Canadian election was almost wholly dominated by this issue. Jean Chrétien office continued the deal and signed NAFTA to expand the free trade area to include Mexico. The United States The United States also had an east-west national transportation system in a similar fashion with Canada. A century ago, the railway network reflected the east-west orientation by the need to bind the Atlantic and Pacific seaboards. From the 1916 Federal Highway Act to the 1956 Defense Interstate Highway Act, the east-west pattern was enhanced. As the largest public works project, the U.S. Interstate Highway System linked cities to facilitate the movement of goods. But, like Canada, there were far fewer north-south than east-west routes. (Bradbury, 2002) The north-south linkages connected major western cities but not offered enough direct routes between Canada and Mexico. Mexico The transportation system in Mexico is unlike that of Canada and the United States, running along a north-south axis. The Mexican transportation network developed around the central region of the country. It ignored its northern border states for the reason that they were thought to be remote and the country wanted to limit its contact and interaction with the United States. In the late 19th century, Mexico began to construct a national railway system which was oriented north-south paralleling the mountain through the country. Finally, the national railway system linked the northern border states with the center regions. In 20th century, Mexico3 CROSSROADS OF THE AMERICAS: THE TRANS-TEXAS CORRDOR HONG, LYNCH, RAMIC CE 5212 began to develop their highway system. They tended to share the same corridors as the railways, which reinforced the north-south transportation network. Before endorsing the North America Free Trade Agreement, the transportation policies in Mexico were especially restrictive when it came to foreign carriers and investors. Mexico did not want any foreign investment or real involvement in either its transportation or oil industry. Its anti-foreign rules and restrictive regulations constrained the growth and competitiveness of the industry significantly. Before NAFTA, foreigners could not take part in transportation activities or own a single share of stock in a Mexican carrier. (Perry, 2004) Historically, the designs of transportation networks reflect a past era when the country pursued independent policies to promote nation-building and economic development. However, NAFTA, a policy emphasizing economic interdependence, has changed all of that, resulting in three national transportation networks were inadequate for the large jump in intra-continental trade. NAFTA The North American Free Trade Agreement was designed to eliminate the majority of tariffs for products traded among its three members — the United States, Canada and Mexico — over 15 years. It was implemented on January 1, 1994. The agreement is trilateral in nature in all areas except agriculture. It also includes two important supplements on environment and labor: North American Agreement on Environmental Cooperation and the North American Agreement of Labor Cooperation, which extend into cooperative efforts to reconcile these policies. The objectives of NAFTA : “Eliminate barriers to trade in, and facilitate the cross-border movement of, goods and services between the territories of the Parties; Promote conditions of fair competition in the free trade area; Increase substantially investment opportunities in the territories of the Parties;4 CROSSROADS OF THE AMERICAS: THE TRANS-TEXAS CORRDOR HONG, LYNCH, RAMIC CE 5212 Provide adequate and effective protection and enforcement of intellectual property rights in each Party's territory; Create effective procedures for the implementation and application of this Agreement, for its joint administration and for the resolution of disputes; and Establish a framework for further trilateral, regional and multilateral cooperation to expand and
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