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Simplifying Border Crossings for Goods Will Help the Economy

October 13, 2016 3 minute Read by Matthew Rooney, Laura Collins
The macroeconomic benefits of this could be significant. Our initial estimates suggest that these small changes in how we plan and fund cross-border infrastructure could increase U.S. GDP by one percentage point, about $220 billion...

Our land border crossings are choked with traffic and beset by long wait times. The safe transport of oil and gas products through cross-border pipelines is subject to a lengthy and opaque presidential permitting process. Cross-border electric lines, like those from the Energia Sierra Juarez wind farm in the San Diego-Tijuana area, are also subject to a similar presidential permitting process.

As remarkable as it sounds, there is no border infrastructure planning system that can address these problems and provide forward-thinking vision for the North American region.  As a result, the cost of making things in the U.S. is too high, limiting our global competitiveness and dampening economic growth and job creation.

The George W. Bush Institute’s North America Working Group has been working on a policy solution to this problem for over a year. The Working Group believes that a tri-lateral border infrastructure facility could be the solution.

This institution could coordinate the three countries’ border infrastructure planning while engaging market forces and private capital to fund cross-border projects. We think three main benefits will accrue with this approach: reduced pressure on budgets to fund cross-border infrastructure, lower production costs for the firms that rely heavily on the North American supply chain, and increased productivity.

The macroeconomic benefits of this could be significant. Our initial estimates suggest that these small changes in how we plan and fund cross-border infrastructure could increase U.S. GDP by one percentage point, about $220 billion, and reduce the federal budget deficit by 1.16% of GDP, nearly $250 billion, in the short term. This analysis does not include the economic and fiscal benefits that would accrue to our neighbors and most important allies, Canada and Mexico.

All of this could be accomplished at relatively little cost—if each of the three countries provided $250 million of paid-in capital, this proposed tri-lateral facility would have over $7 billion to leverage for cross-border infrastructure investments.

Our competitors in Asia and Europe are systematically planning and investing in border infrastructure, squeezing out unnecessary costs and opening opportunities for growth and prosperity for themselves – without compromising one bit on security.  We can and must do better.


Author

Matthew Rooney
Matthew Rooney

Matthew Rooney joined the Bush Center in June 2015 following a career as a Foreign Service Officer with the U.S. Department of State. At postings in Washington and abroad, he focused on advocating market-driven solutions to economic policy challenges in both industrialized and developing countries, and on protecting the interests of U.S. companies abroad.

In Washington, Rooney was on loan to the U.S. Chamber of Commerce to create a high-level private sector advisory body for the Summits of the Americas, working closely with the U.S. private sector and with companies and business associations from throughout the Americas to negotiate an agenda to promote economic integration in the region.  Previously, he was Deputy Assistant Secretary responsible for relations with Canada and Mexico and for regional economic policy.  In prior Washington assignments, Rooney worked for then-Senator Fred Thompson, and supported negotiations to open global markets to U.S. airline services.

Abroad, Rooney was Consul General in Munich, a Consulate General providing a full range of Consular and export promotion services, supporting a permanent presence of 30,000 U.S. forces in two major base complexes, and carrying out a media and public relations initiative in support of U.S. diplomatic objectives in Germany. As Counselor for Economic and Commercial Affairs at the U.S. Embassy in San Salvador, El Salvador, he laid the groundwork for free trade negotiations between the United States and the five countries of Central America, and promoted market-based reforms for electrical power. Prior to this, he served in various posts in Germany, Gabon and Côte d’Ivoire.

Rooney studied Economics, German and French at the University of Texas at Austin and received his Master’s Degree in International Management at the University of Texas at Dallas.

Full Bio
Laura Collins
Laura Collins

Laura Collins is the Deputy Director, Bush Institute-SMU Economic Growth Initiative at the George W. Bush Institute. Collins previously served as the Director of Immigration Policy at the American Action Forum. She has experience in politics, working as a Senior Research Analyst at the Republican National Committee for the 2012 election cycle and in the Texas House of Representatives for the 82nd Legislature. A former practicing attorney, Collins earned a JD from The University of Texas School of Law and a BBA from the University of Oklahoma.

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