Ron Paul - Trade Policy

Last Updated: Sep 23, 2011

Summary

Congressman Paul supports free trade with other nations, but he opposes agreements such as NAFTA and CAFTA, and opposes US involvement in the World Trade Organization (WTO).

Congressman Paul lists three reasons why he supports free trade. The first reason is a moral reason. There is a moral element involved in trade, because when governments come in and regulate how citizens spend their money, they are telling them what they can do or cannot do. In a free society, individuals who earn money should be allowed to spend the money the way they want.

The second argument for free trade is an economic argument. There is a benefit to free trade. Free trade means that you will not have high tariffs and barriers so you cannot buy products and you cannot exert this freedom of choice by buying outside. If you have a restricted majority and you can evenly buy from within, it means you are protecting industries that may not be doing a very good job, and there is not enough competition.

The third benefit of free trade is the peace effect from trade. It is known that countries that trade with each other and depend on each other for certain products and where the trade has been free and open and communications are free and open and travel is free and open, they are very less likely to fight wars. I happen to personally think this is one of the greatest benefits of free trade, that it leads us to policies that direct us away from military confrontation.

Congressman Paul asserts that the current programs such as NAFTA and CAFTA are managed trade. Managed trade and subsidized trade do not qualify as free trade.

Congressman Paul asserts that the Constitution is very clear: Article I, section 8, gives the Congress the responsibility of dealing with international trade. It does not delegate it to the President, it does not delegate it to a judge, it does not delegate it to an international management organization like the World Trade Organization

What is Free Trade

In May of 2000, Congressman Paul spoke on the House floor about free trade and it's definition.

What Is Free Trade?
May 2, 2000
Statement of HON. RON PAUL OF TEXAS
Mr. PAUL. Madam Speaker, I asked for this Special Order this evening to talk about trade. We are going to be dealing with permanent normal trade relations with China here soon, and there is also a privileged resolution that will be brought to the floor that I have introduced, H.J.Res. 90. The discussion in the media and around the House floor has been rather clear about the permanent normal trade status, but there has not been a whole lot of talk yet about whether or not we should even really be in the World Trade Organization.
I took this time mainly because I think there is a lot of misunderstanding about what free trade is. There are not a whole lot of people who get up and say I am opposed to free trade, and many of those who say they are for free trade quite frankly I think they have a distorted definition of what free trade really is.
I would like to spend some time this evening talking a little bit about that, because as a strict constitutionalist and one who endorses laissez-faire capitalism, I do believe in free trade; and there are good reasons why countries should trade with each other.
The first reason I would like to mention is a moral reason. There is a moral element involved in trade, because when governments come in and regulate how citizens spend their money, they are telling them what they can do or cannot do. In a free society, individuals who earn money should be allowed to spend the money the way they want. So if they find that they prefer to buy a car from Japan rather than Detroit, they basically have the moral right to spend their money as they see fit and those kinds of choices should not be made by government. So there is a definite moral argument for free trade.
Patrick Henry many years ago touched on this when he said, `You are not to inquire how your trade may be increased nor how you are to become a great and powerful people but how your liberties may be secured, for liberty ought to be the direct end of your government.' We have not heard much talk of liberty with regards to trade, but we do hear a lot about enhancing one's ability to make more money overseas with trading with other nations. But the argument, the moral argument, itself should be enough to convince one in a free society that we should never hamper or interfere with free trade.
When the colonies did not thrive well prior to the Constitution, two of the main reasons why the Constitutional Convention was held was, one, there was no unified currency, that provided a great deal of difficulty in trading among the States, and also trade barriers are among the States.
Even our Constitution was designed to make sure that there were not trade barriers, and this was what the interstate commerce clause was all about. Unfortunately though, in this century the interstate commerce clause has been taken and twisted around and is the excuse for regulating even trade within a State. Not only interstate trade, but even activities within a State has nothing to do with interstate trade. They use the interstate commerce clause as an excuse, which is a wild distortion of the original intent of the Constitution, but free trade among the States having a unified currency and breaking down the barriers certainly was a great benefit for the development and the industrialization of the United States.
The second argument for free trade is an economic argument. There is a benefit to free trade. Free trade means that you will not have high tariffs and barriers so you cannot buy products and you cannot exert this freedom of choice by buying outside. If you have a restricted majority and you can evenly buy from within, it means you are protecting industries that may not be doing a very good job, and there is not enough competition.
It is conceded that probably it was a blessing in disguise when the automobile companies in this country were having trouble in the 1970s, because the American consumer was not buying the automobiles, the better automobiles were coming in, and it should not have been a surprise to anybody that all of a sudden the American cars got to be much better automobiles and they were able to compete.
There is a tremendous economic benefit to the competition by being able to buy overseas. The other economic argument is that in order to keep a product out, you put on a tariff, a protective tariff. A tariff is a tax. We should not confuse that, we should not think tariff is something softer than a tax in doing something good. A tariff is a tax on the consumer. So those American citizens who want to buy products at lower prices are forced to be taxed.
If you have poor people in this country trying to make it on their own and they are not on welfare, but they can buy clothes or shoes or an automobile or anything from overseas, they are tremendously penalized by forcing them to pay higher prices by buying domestically.
The competition is what really encourages producers to produce better products at lower costs and keep the prices down. If one believes in free trade, they do not enter into free trade for the benefit of somebody else. There is really no need for reciprocity. Free trade is beneficial because it is a moral right. Free trade is beneficial because there is an economic advantage to buying products at a certain price and the competition is beneficial.
There really are no costs in the long run. Free trade does not require management. It is implied here on conversation on the House floor so often that free trade is equivalent to say we will turn over the management of trade to the World Trade Organization, which serves special interests. Well, that is not free trade; that is a misunderstanding of free trade.
Free trade means you can buy and sell freely without interference. You do not need international management. Certainly, if we are not going to have our own government manage our own affairs, we do not want an international body to manage these international trades.
Another thing that free trade does not imply is that this opens up the doors to subsidies. Free trade does not mean subsidies, but inevitably as soon as we start trading with somebody, we accept the notion of managed trade by the World Trade Organization, but immediately we start giving subsidies to our competitors.
If our American companies and our American workers have to compete, the last thing they should ever be required to do is pay some of their tax money to the Government, to send subsidies to their competitors; and that is what is happening. They are forced to subsidize their competitors on foreign aid. They support their competitors overseas at the World Bank. They subsidize their competitors in the Export/Import Bank, the Overseas Private Investment Corporation.
We literally encourage the exportation of jobs by providing overseas protection in insurance that cannot be bought in the private sector. Here a company in the United States goes overseas for cheap labor, and if, for political or economic reasons, they go bust, who bails them out. It is the American taxpayer, once again, the people who are struggling and have to compete with the free trade.
It is so unfair to accept this notion that free trade is synonymous with permitting these subsidies overseas, and, essentially, that is what is happening all the time. Free trade should never mean that through the management of trade that it endorses the notion of retaliation and also to stop dumping.
This whole idea that all of a sudden if somebody comes in with a product with a low price that you can immediately get it stopped and retaliate, and this is all done in the name of free trade, it could be something one endorses. They might argue that they endorse this type of managed trade and subsidized trade; but what is wrong, and I want to make this clear, what is wrong is to call it free trade, because that is not free trade.
Most individuals that I know who promote free trade around Washington, D.C., do not really either understand what free trade is or they do not really endorse it. And they are very interested in the management aspect, because some of the larger companies have a much bigger clout with the World Trade Organization than would the small farmers, small rancher or small businessman because they do not have the same access to the World Trade Organization.
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For instance, there has been a big fight in the World Trade Organization with bananas. The Europeans are fighting with the Americans over exportation of bananas. Well, bananas are not grown in Europe and they are not grown in the United States, and yet that is one of the big issues of managed trade, for the benefit of some owners of corporations that are overseas that make big donations to our political parties. That is not coincidental.
So powerful international financial individuals go to the World Trade Organization to try to get an edge on their competitor. If their competitor happens to be doing a better job and selling a little bit lower, then they come immediately to the World Trade Organization and say, Oh, you have to stop them. That is dumping. We certainly do not want to give the consumers the benefit of having a lower price.
So this to me is important, that we try to be clear on how we define free trade, and we should not do this by accepting the idea that management of trade, as well as subsidizing trade and calling it free trade is just not right. Free trade is the ability of an individual or a corporation to buy goods and spend their money as they see fit, and this provides tremendous economic benefits.
The third benefit of free trade, which has been known for many, many centuries, has been the peace effect from trade. It is known that countries that trade with each other and depend on each other for certain products and where the trade has been free and open and communications are free and open and travel is free and open, they are very less likely to fight wars. I happen to personally think this is one of the greatest benefits of free trade, that it leads us to policies that direct us away from military confrontation.
Managed trade and subsidized trade do not qualify. I will mention just a little later why I think it does exactly the opposite.
There is a little bit more to the trade issue than just the benefits of free trade, true free trade, and the disadvantages of managed trade, because we are dealing now when we have a vote on the normal trade status with China, as well as getting out of the World Trade Organization, we are dealing with the issue of sovereignty. The Constitution is very clear. Article I, section 8, gives the Congress the responsibility of dealing with international trade. It does not delegate it to the President, it does not delegate it to a judge, it does not delegate it to an international management organization like the World Trade Organization.
International trade management is to be and trade law is to be dealt with by the U.S. Congress, and yet too often the Congress has been quite willing to renege on that responsibility through fast-track legislation and deliver this authority to our President, as well as delivering through agreements, laws being passed and treaties, delivering this authority to international bodies such as the UN-IMF-World Trade Organizations, where they make decisions that affect us and our national sovereignty.
The World Trade Organization has been in existence for 5 years. We voted to join the World Trade Organization in the fall of 1994 in the lame duck session after the Republicans took over the control of the House and Senate, but before the new Members were sworn in. So a lame duck session was brought up and they voted, and by majority vote we joined the World Trade Organization, which, under the Constitution, clearly to anybody who has studied the Constitution, is a treaty. So we have actually even invoked a treaty by majority vote.
This is a serious blunder, in my estimation, the way we have dealt with this issue, and we have accepted the idea that we will remain a member based on this particular vote.
Fortunately, in 1994 there was a provision put in the bill that said that any member could bring up a privileged resolution that gives us a chance at least to say is this a good idea to be in the World Trade Organization, or is it not? Now, my guess is that we do not have the majority of the U.S. Congress that thinks it is a bad idea. But I am wondering about the majority of the American people, and I am wondering about the number of groups now that are growing wary of the membership in the World Trade Organization, when you look at what happened in Seattle, as well as demonstrations here in D.C. So there is a growing number of people from various aspects of the political spectrum who are now saying, what does this membership mean to us? Is it good or is it bad? A lot of them are coming down on the side of saying it is bad.
Now, it is also true that some who object to membership in the World Trade Organization happen to be conservative free enterprisers, and others who object are coming from the politics of the left. But there is agreement on both sides of this issue dealing with this aspect, and it has to do with the sovereignty issue.
There may be some labor law and there may be some environmental law that I would object to, but I more strenuously object to the World Trade Organization dictating to us what our labor law ought to be and what our environmental law ought to be. I highly resent the notion that the World Trade Organization can dictate to us tax law.
We are currently under review and the World Trade Organization has ruled against the United States because we have given a tax break to our overseas company, and they have ruled against us and said that this tax break is a tax subsidy, language which annoys me to no end. They have given us until October 1 to get rid of that tax break for our corporations, so they are telling us, the U.S. Congress, what we have to do with tax law.
You say, oh, that cannot be. We do not have to do what they tell us. Well, technically we do not have to, but we will not be a very good member, and this is what we agreed to in the illegal agreement. Certainly it was not a legitimate treaty that we signed. But in this agreement we have come up and said that we would obey what the WTO says.
Our agreement says very clearly that any ruling by the WTO, the Congress is obligated to change the law. This is the interpretation and this is what we signed. This is a serious challenge, and we should not accept so easily this idea that we will just go one step further.
This has not just happened 5 years ago, there has been a gradual erosion of the concept of national sovereignty. It occurred certainly after World War II with the introduction of the United Nations, and now, under current conditions, we do not even ask the Congress to declare war, yet we still fight a lot of wars. We send troops all over the world and we are involved in combat all the time, and our presidents tell us they get the authority from a UN resolution. So we have gradually lost the concept of national sovereignty.
I want to use a quote from somebody that I consider rather typical of the establishment. We talk about the establishment, but nobody ever knows exactly who they are. But I will name this individual who I think is pretty typical of the establishment, and that is Walter Cronkite. He says, `We need not only an executive to make international law, but we need the military forces to enforce that law and the judicial system to bring the criminals to justice in an international government.'
`But,' he goes on to say, and this he makes very clear, and this is what we should be aware of, `the American people are going to begin to realize that perhaps they are going to have to yield some sovereignty to an international body to enforce world law, and I think that is going to come to other people as well.'
So it is not like it has been hidden, it is not like it is a secret. It is something that those who disagree with me about liberty and the Constitution, they believe in internationalism and the World Trade Organization and the United Nations, and they certainly have the right to that belief, but it contradicts everything America stands for and it contradicts our Constitution, so, therefore, we should not allow this to go unchallenged.
Now, the whole idea that treaties could be passed and undermine the ability of our Congress to pass legislation or undermine our Constitution, this was thought about and talked about by the founders of this country. They were rather clear on the idea that a treaty, although the treaty can become the law of the land, a treaty could never be an acceptable law of the land if it amended or changed the Constitution. That would be ridiculous, and they made that very clear.
It could have the effect of the law of the land, as long as it was a legitimate constitutional agreement that we entered into. But Thomas Jefferson said if the treaty power is unlimited, then we do not have a Constitution. Surely the President and the Senate cannot do by treaty what the whole government is interdicted from doing in any way.
So that is very important. We cannot just sit back and accept the idea that the World Trade Organization, we have entered into it, it was not a treaty, it was an agreement, but we have entered into it, and the agreement says we have to do what they tell us, even if it contradicts the whole notion that it is the Congress' and people's responsibility to pass their own laws with regard to the environment, with regard to labor and with regard to tax law.
So I think this is important material. I think this is an important subject, a lot more important than just the vote to trade with China. I think we should trade with China. I think we should trade with Cuba. I think we should trade with everybody possible, unless we are at war with them. I do not think we should have sanctions against Iran, Iraq or Libya, and it does not make much sense to me to be struggling and fighting and giving more foreign aid to a country like China, and at the same time we have sanctions on and refuse to trade and talk with Cuba. That does not make a whole lot of sense. Yet those who believe and promote trade with China are the ones who will be strongly objecting to trade with Cuba and these other countries. So I think a little bit more consistency on this might be better for all of us.
Alexander Hamilton also talked about this. He said a treaty cannot be made which alters the Constitution of the country or which infringes any expressed exception to the powers of the Constitution of the United States.
So these were the founders talking about this, and yet we have drifted a long way. It does not happen overnight. It has been over a 50-year period. Five years ago we went one step further. First we accepted the idea that international finance would be regulated by the IMF. Then we accepted the idea that the World Bank, which was supposed to help the poor people of the world and redistribute wealth, they have redistributed a lot of wealth, but most of it ended up in the hands of wealthy individuals and wealthy politicians. But the poor people of the world never get helped by these programs. Now, 5 years ago we have accepted the notion that the World Trade Organization will bring about order in trade around the country.
Well, since that time we have had a peso crisis in Mexico and we had a crisis with currencies in Southeast Asia. So I would say that the management of finances with the IMF as well as the World Trade Organization has been very unsuccessful, and even if one does not accept my constitutional argument that we should not be doing this, we should at least consider the fact that what we are doing is not very successful.

CAFTA

In June of 2005, Congressman Paul used his "Texas Talk" to address CAFTA. He notes that CAFTA creates bureaucracy, but does little to create more trade.

CAFTA: More Bureaucracy, Less Free Trade
June 6, 2005
The Central America Free Trade Agreement, known as CAFTA, will be the source of intense political debate in Washington this summer. The House of Representatives will vote on CAFTA ratification in June, while the Senate likely will vote in July. I oppose CAFTA for a very simple reason: it is unconstitutional. The Constitution clearly grants Congress alone the authority to regulate international trade. The plain text of Article I, Section 8, Clause 3 is incontrovertible. Neither Congress nor the President can give this authority away by treaty, any more than they can repeal the First Amendment by treaty. This fundamental point, based on the plain meaning of the Constitution, cannot be overstated. Every member of Congress who votes for CAFTA is voting to abdicate power to an international body in direct violation of the Constitution. We don’t need government agreements to have free trade. We merely need to lower or eliminate taxes on the American people, without regard to what other nations do. Remember, tariffs are simply taxes on consumers. Americans have always bought goods from abroad; the only question is how much our government taxes us for doing so. As economist Henry Hazlitt explained, tariffs simply protect politically-favored special interests at the expense of consumers, while lowering wages across the economy as a whole. Hazlitt, Ludwig von Mises, Friedrich Hayek, Murray Rothbard, and countless other economists have demolished every fallacy concerning tariffs, proving conclusively that unilateral elimination of tariffs benefits the American people. We don’t need CAFTA or any other international agreement to reap the economic benefits promised by CAFTA supporters, we only need to change our own harmful economic and tax policies. Let the rest of the world hurt their citizens with tariffs; if we simply reduce tariffs and taxes at home, we will attract capital and see our economy flourish. It is absurd to believe that CAFTA and other trade agreements do not diminish American sovereignty. When we grant quasi-governmental international bodies the power to make decisions about American trade rules, we lose sovereignty plain and simple. I can assure you first hand that Congress has changed American tax laws for the sole reason that the World Trade Organization decided our rules unfairly impacted the European Union. Hundreds of tax bills languish in the House Ways and Means committee, while the one bill drafted strictly to satisfy the WTO was brought to the floor and passed with great urgency last year. The tax bill in question is just the tip of the iceberg. The quasi-judicial regime created under CAFTA will have the same power to coerce our cowardly legislature into changing American laws in the future. Labor and environmental rules are inherently associated with trade laws, and we can be sure that CAFTA will provide yet another avenue for globalists to impose the Kyoto Accord and similar agreements on the American people. CAFTA also imposes the International Labor Organization’s manifesto, which could have been written by Karl Marx, on American business. I encourage every conservative and libertarian who supports CAFTA to read the ILO declaration and consider whether they still believe the treaty will make America more free. CAFTA means more government! Like the UN, NAFTA, and the WTO, it represents another stone in the foundation of a global government system. Most Americans already understand they are governed by largely unaccountable forces in Washington, yet now they face having their domestic laws influenced by bureaucrats in Brussels, Zurich, or Mexico City. CAFTA and other international trade agreements do not represent free trade. Free trade occurs in the absence of government interference in the flow of goods, while CAFTA represents more government in the form of an international body. It is incompatible with our Constitution and national sovereignty, and we don’t need it to benefit from international trade.

The WTO and International Trade

In May of 2000, Congressman Paul spoke on the House floor concerning the WTO and International trade.

International Trade
May 23, 2000
Statement of HON. RON PAUL OF TEXAS
Mr. PAUL. Mr. Speaker, this week there will be a lot of talk on the House floor about international trade. One side will talk about pseudo free trade, the other about fair trade. Unfortunately, true free trade will not be discussed.
Both sides generally agree to subsidies and international management of trade. The pseudo free trader will not challenge the WTO's authority to force us to change our tax, labor, and environmental laws to conform to WTO rules, nor will they object to the WTO authorizing economic sanctions on us if we are slow in following WTO's directives.
What is permitted is a low-level continuous trade war, not free trade. The current debate over Chinese trade status totally ignores a much bigger trade problem the world faces, an ocean of fluctuating fiat currencies.
For the past decade, with sharp adjustments in currency values such as occurred during the Asian financial crisis, the dollar and the U.S. consumers benefitted. But these benefits will prove short-lived, since the unprecedented prosperity and consumption has been achieved with money that we borrow from abroad.
Our trade imbalances and our skyrocketing current account deficit once again hit a new record in March. Our distinction as the world's greatest debtor remains unchallenged. But that will all end when foreign holders of dollars become disenchanted with financing our grand prosperity at their expense. One day, foreign holders of our dollars will realize that our chief export has been our inflation.
The Federal Reserve believes that prosperity causes high prices and rising wages, thus causing it to declare war on a symptom of its own inflationary policy, deliberately forcing an economic slowdown, a sad and silly policy, indeed. The Fed also hopes that higher interest rates will curtail the burgeoning trade deficit and prevent the serious currency crisis that usually results from currency-induced trade imbalances. And of course, the Fed hopes to do all this without a recession or depression.
That is a dream. Not only is the dollar due for a downturn, the Chinese currency is, as well. When these adjustments occur and recession sets in, with rising prices in consumer and producer goods, there will be those who will argue that it happened because of, or the lack thereof, of low tariffs and free trade with China.
But instead, I suggest we look more carefully for the cause of the coming currency crisis. We should study the nature of all the world currencies and the mischief that fiat money causes, and resist the temptation to rely on the WTO, the IMF, the World Bank, pseudo free trade, to solve the problems that only serious currency reform can address.

The Sausage Factory

In August of 2005, Congressman Paul used his "Texas Talk" to address the process used to pass CAFTA.

The Sausage Factory
August 1, 2005
Congress passed a multinational trade bill known as CAFTA last week, but not without a feverish late night vote marred by controversy and last-minute vote switching. Leaving aside the arguments for or against CAFTA itself, the process by which the bill ultimately passed should sicken every American who believes in representative government. Late-night arm-twisting by House leaders to get votes is of course nothing new. We witnessed far worse when Congress passed the ruinous Medicare prescription drug bill in the dead of night two years ago. Yet even after months of unprecedented wheeling and dealing by corporate lobbyists, congressional leaders, and the White House, the Washington establishment still failed to pass CAFTA in the US House. That’s right, when the 15-minute voting period expired last Wednesday evening, CAFTA seemingly had been defeated. Here’s how. As the vote progressed, the tally was neck and neck. When the 15-minute period ended, CAFTA had gone down in flames. But pro-CAFTA forces were so determined to get what they wanted, they broke the rules. House leadership ignored the time limit and kept twisting arms and making deals until they finally had the votes to pass CAFTA nearly an hour later. What kind of deals? Well, one member of House leadership told reluctant legislators, “We've got to have you; you tell us what you want.” And tell they did. Lawmakers in textile producing states were bought off with promises of textile subsidies. Lawmakers in sugar-producing states were bought off with promises of special treatment in the 2007 farm bill. On and on it went, with promises of new bridges, parks, and whatever else it took to pass CAFTA. Rest assured that you will pay dearly for these bribes used to buy votes. Every favor granted and every pet project funded comes on top of the pork-laden appropriations bills already passed in the House this year. These new goodies will be added to the final House-Senate versions passed later this year. One of my colleagues estimated that the price tag for buying the CAFTA vote will be at least $50 billion. That’s right, $50 billion to win a vote. Is this what you want from your representatives in office? Perhaps the strangest vote buyoff occurred two days before the CAFTA vote. Lawmakers from hard-hit manufacturing districts steadfastly have opposed CAFTA, arguing that it would accelerate the outsourcing of jobs to nations with cheap labor. So House leaders scrambled to craft last-minute legislation to “get tough” on China, which is the real source of concern for most American manufacturers. A bill was drawn up, and a hasty vote cast, so lawmakers could explain that they traded a yes vote on CAFTA for action against China. One small problem presented itself, however: the China bill failed on the House floor! So House leaders went back to the drawing board, struck some and held a second vote on the same bill the next day. This time it passed, but its chances of surviving the Senate or a White House veto are virtually nil. So members from manufacturing districts literally sold their votes for nothing. Their months of double-talking, coyness, and vote peddling resulted in nothing more than an empty promise. The president’s press secretary called the CAFTA vote “a real victory for the American people.” The problem is the vast majority of Americans have not even heard of CAFTA, and those who have overwhelmingly oppose it. CAFTA was conceived and created by corporate interests, and to claim otherwise is preposterous. The CAFTA vote had nothing to do with the American public, or even trade policy per se. CAFTA was driven by politics and nothing more. Multinational corporations and political globalists share the same goals, namely the centralization of political power in international bodies and the diminution of national sovereignty. What we witnessed last week was not just the selling of votes, but also a sellout of American control over our own trade regulations.

Opposition to NAFTA Superhighway

In October of 2006, Congressman Paul released a press statement noting his opposition to the planned NAFTA superhighway.

Paul Opposes NAFTA Superhighway
Congressman Paul Opposes NAFTA Superhighway
October 4, 2006 Washington: Congressman Ron Paul joined several of his congressional colleagues in expressing outrage at the planned “NAFTA superhighway” that will require eminent domain actions on an enormous scale in Texas and beyond. H.Con.Res 487, introduced by Virginia Representative Virgil Goode and cosponsored by Paul, expresses the sense of Congress that the United States should not engage in the construction of a NAFTA superhighway or enter into any plans to create a North American Union between Canada, the U.S., and Mexico.
Plans for such a superhighway are part of the so-called “Security and Prosperity Partnership of North America (SPP), which is neither a treaty nor a formal agreement. Rather, the SPP is a "dialogue" launched by the heads of state of Canada, Mexico, and the United States at a summit in Waco, Texas in March 2005.
According to the SPP website, this dialogue will create new supra-national organizations to coordinate border security, health policy, economic and trade policy, and energy policy between the three governments. As such, it is but an extension of the NAFTA and CAFTA agreements-- government trade schemes that bypass the express constitutional authority of Congress to regulate trade.
“This is a matter of national sovereignty,” Paul stated. “Any movement toward a North American Union diminishes the ability of average Americans to influence the laws under which they must live. The SPP agreement, which includes plans for a major transnational superhighway through Texas, is moving forward without congressional oversight-- and that is an outrage. The administration needs a strong message from Congress that the American people will not tolerate backroom deals that threaten our sovereignty.”

That same month, Congressman Paul used his "Texas Talk" to address the NAFTA Superhighway.

The NAFTA Superhighway
October 30, 2006 By now many Texans have heard about the proposed “NAFTA Superhighway,” which is also referred to as the trans-Texas corridor. What you may not know is the extent to which plans for such a superhighway are moving forward without congressional oversight or media attention. This superhighway would connect Mexico, the United States, and Canada, cutting a wide swath through the middle of Texas and up through Kansas City. Offshoots would connect the main artery to the west coast, Florida, and northeast. Proponents envision a ten-lane colossus the width of several football fields, with freight and rail lines, fiber-optic cable lines, and oil and natural gas pipelines running alongside. This will require coordinated federal and state eminent domain actions on an unprecedented scale, as literally millions of people and businesses could be displaced. The loss of whole communities is almost certain, as planners cannot wind the highway around every quaint town, historic building, or senior citizen apartment for thousands of miles. Governor Perry is a supporter of the superhighway project, and Congress has provided small amounts of money to study the proposal. Since this money was just one item in an enormous transportation appropriations bill, however, most members of Congress were not aware of it. The proposed highway is part of a broader plan advanced by a quasi-government organization called the “Security and Prosperity Partnership of North America,” or SPP. The SPP was first launched in 2005 by the heads of state of Canada, Mexico, and the United States at a summit in Waco. The SPP was not created by a treaty between the nations involved, nor was Congress involved in any way. Instead, the SPP is an unholy alliance of foreign consortiums and officials from several governments. One principal player is a Spanish construction company, which plans to build the highway and operate it as a toll road. But don’t be fooled: the superhighway proposal is not the result of free market demand, but rather an extension of government-managed trade schemes like NAFTA that benefit politically-connected interests. The real issue is national sovereignty. Once again, decisions that affect millions of Americans are not being made by those Americans themselves, or even by their elected representatives in Congress. Instead, a handful of elites use their government connections to bypass national legislatures and ignore our Constitution-- which expressly grants Congress the sole authority to regulate international trade. The ultimate goal is not simply a superhighway, but an integrated North American Union--complete with a currency, a cross-national bureaucracy, and virtually borderless travel within the Union. Like the European Union, a North American Union would represent another step toward the abolition of national sovereignty altogether. A new resolution, introduced by Representative Virgil Goode of Virginia, expresses the sense of Congress that the United States should not engage in the construction of a NAFTA superhighway, or enter into any agreement that advances the concept of a North American Union. I wholeheartedly support this legislation, and predict that the superhighway will become a sleeper issue in the 2008 election. Any movement toward a North American Union diminishes the ability of average Americans to influence the laws under which they must live. The SPP agreement, including the plan for a major transnational superhighway through Texas, is moving forward without congressional oversight-- and that is an outrage. The administration needs a strong message from Congress that the American people will not tolerate backroom deals that threaten our sovereignty.

In April of 2008, Congressman Paul released another statement noting his opposition to the Trans-Texas National Corridor and his continued opposition to the NAFTA superhighway.

Congressman Ron Paul Stands Up for National Sovereignty
April 21, 2008
New Orleans, LA – Congressman Ron Paul issued a statement which was read at a news conference in New Orleans in advance of a Security and Prosperity Partnership (SPP) summit meeting between President Bush, Canadian Prime Minister Stephen Harper, and Mexican President Felipe Calderon. The Conservative Caucus held the news conference in opposition to the SPP, sharing the belief with Congressman Paul and many others that the SPP threatens national sovereignty.
Congressman Paul’s remarks focused on his continued opposition to the Trans Texas Corridor and the NAFTA Super Highway :
“As we all know, there have been significant moves recently to expand the Security and Prosperity Partnership (SPP) initiated by President Bush and his Mexican and Canadian counterparts in 2005. One such plan is to construct a so-called “NAFTA Superhighway” running from Mexico , through Texas , and up eventually into Canada . I have opposed this project from the beginning, signing on as a co-sponsor of House Concurrent Resolution 40 expressing Congressional disapproval of the NAFTA Superhighway and any moves toward a North American Union.
More recently, I introduced an even stronger piece of legislation, H.R.5191, which would prohibit the use of federal funds to carry out this highway project. The federal government has no business being partner to this outrageous plan, according to which countless landowners would have their private property confiscated under eminent domain. This prohibition of funds, if passed, would go a long way toward derailing this ill-conceived project and would send a clear message that further attempts to undermine US sovereignty would not be unchallenged in Congress. It is long past time the United States House and Senate start taking our Constitutional oversight roles seriously.”

Lou Dobbs Appearance

In April of 2007, while campaigning for the Republican nomination for President, Congressman Paul spoke about his trade policies, his support for free trade, and his opposition to current policies.

Mexico and Free Trade

In September of 2007, Congressman Paul used his "Texas Talk' to discuss NAFTA and the presence of Mexican trucks on US highways.

Regulation, Free Trade and Mexican Trucks
Another NAFTA nail is about to be hammered into the coffin Washington is building for the US economy. Within the next few days our borders will be opened to the Mexican trucking industry in an unprecedented way. A "pilot" program is starting which will allow trucks from Mexico to haul goods beyond the 25 mile buffer zone to any point in the United States . Officials claim this is being done with utmost oversight, but Americans still have their legitimate concerns. Rather than securing our borders, we seem to be providing more pores for illegal aliens, drug dealers, and terrorists to permeate. Not only that, but the anti-competitive and burdensome yoke of over-regulation of our industry at home is about to send a lot more Americans to the unemployment lines. The American Trucking industry has been heavily regulated since 1935. The express purpose of The Motor Carrier Act was to eliminate competition through permitting, regulating tariff rates, even approving routes. American trucking companies have been fighting ever since for some relief from the substantial regulatory burdens placed on them. Regulatory compliance is the single most daunting barrier to entry, and eats up huge amounts of profit. Now, to add insult to injury, Mexican trucking companies, not subject to the same onerous standards, will be allowed to roll right in and squeeze American industry further. This will severely undermine the ability of American trucking companies to remain solvent. The fact that this is being done in the name of free trade is disturbing. Free trade is not complicated, yet NAFTA and CAFTA are comprised of thousands of pages of complicated legal jargon. All free trade really needs is two words: Low tariffs. Free trade does not require coordination with another government to benefit citizens here. Just like domestic businesses don't pay taxes, foreign businesses do not pay tariffs – consumers do, in the form of higher prices. If foreign governments want to hurt their own citizens with protectionist tariffs, let them. But let us set a good example here, and show the world an honest example of true free trade. And let us stop hurting American workers with mountains of red tape in the name of safety. Safety standards should be set privately, by the industry and by the insurance companies who have the correct motivating factors to do so. Free trade is not the problem, and pseudo free trade is what is being offered in the wrongly named North American Free Trade Agreement and all its offshoots. The problem is a government-managed economy and the burdensome regulation that results. For our economy to remain competitive in the world, we must remember what it is to be truly free. We must lift the regulatory shackles threatening to sink our industries into oblivion. Free trade begins with freedom domestically, and we can't afford to lose that.

Google Interview

In January of 2008, Congressman Paul was interviewed at Google and spoke about foreign policy and trade.

Opposition to NAFTA and the UN

Trade Wars and Free Trade

In September of 2009, Congressman Paul used his "Texas Talk" to address free trade and protectionism.

Trade Wars and Protectionism are not Free Trade
Two weeks ago, both the administration and the Fed announced with straight faces that the recession was over and the signs of economic recovery were clear. Then last week, the president made a stunning decision that signals the administration’s determination to repeat the mistakes of the Great Depression. Much like the Smoot-Hawley Tariffs that set off a global trade war and effectively doomed us to ten more years of economic misery, Obama’s decision to enact steep tariffs on Chinese imported tires could spark a trade war with the single most important trading partner we have. Not only does China manufacture a whole host of products that end up on American store shelves, they are also still buying our Treasury debt.
One has to wonder why this course of action is being undertaken if the administration really believes its own statements about economic recovery. Why are they still trying to fix something they have supposedly already fixed? The most troubling thing is the rhetoric about free trade given to justify this. The administration claims it is merely enforcing trade policies and that this is necessary for free trade. This sort of double speak demonstrates a gross misunderstanding of free trade, economics and world history. Yet these are the same people the country trusts to solve our problems. This sort of thing should remove all doubt about the credibility of the decision makers in Washington.
The truth is this will hurt American consumers by driving up prices of tires and cars. This will also complicate matters for our already crippled manufacturing and agricultural industries, if and when China retaliates against US made products. Whatever jobs might be saved in the tire and steel industries here as a result of this protectionist measure will likely be lost in other American industries. It is even doubtful that those jobs will be saved, as cheap tires can be obtained from other places like Mexico instead. It is difficult to see any real winners among all the losers where trade wars are concerned. If Unions think this is beneficial to them, they are being penny-wise and pound foolish.
Free trade with all and entangling alliances with none has always been the best policy in dealing with other countries on the world stage. This is the policy of friendship, freedom and non-interventionism and yet people wrongly attack this philosophy as isolationist. Nothing could be further from the truth. Isolationism is putting up protectionist trade barriers, starting trade wars imposing provocative sanctions and one day finding out we have no one left to buy our products. Isolationism is arming both sides of a conflict, only to discover that you’ve made two enemies instead of keeping two friends. Isolationism is trying to police the world but creating more resentment than gratitude. Isolationism is not understanding economics, or other cultures, but clumsily intervening anyway and creating major disasters out of minor problems.
The government should not be in the business of giving out favors to special interests or picking winners and losers in the market, yet this has been most of what has consumed politicians’ attention in Washington. It has reached a fevered pitch lately and it needs to end if we are ever to regain a functional and prosperous economy.

Campaign Website Statements

ISSUE - American Independence and Sovereignty
”I believe in being friends and I like as much free travel as possible and I like free trade, but I don’t like more government management because it essentially protects big industry...”
Government regulations, taxes, and corporate subsidies have distorted the energy market, causing some prices to rise above what they would be in the free market, while artificially lowering other prices So called free trade deals and world governmental organizations like the International Criminal Court (ICC), NAFTA, GATT, WTO, and CAFTA are a threat to our independence as a nation. They transfer power from our government to unelected foreign elites.
The ICC wants to try our soldiers as war criminals. Both the WTO and CAFTA could force Americans to get a doctor’s prescription to take herbs and vitamins. Alternative treatments could be banned.
The WTO has forced Congress to change our laws, yet we still face trade wars. Today, France is threatening to have U.S. goods taxed throughout Europe. If anything, the WTO makes trade relations worse by giving foreign competitors a new way to attack U.S. jobs.
NAFTA’s superhighway is just one part of a plan to erase the borders between the U.S. and Mexico, called the North American Union. This spawn of powerful special interests, would create a single nation out of Canada, the U.S. and Mexico, with a new unelected bureaucracy and money system. Forget about controlling immigration under this scheme.
And a free America, with limited, constitutional government, would be gone forever.
Let’s not forget the UN. It wants to impose a direct tax on us. I successfully fought this move in Congress last year, but if we are going to stop ongoing attempts of this world government body to tax us, we will need leadership from the White House.
We must withdraw from any organizations and trade deals that infringe upon the freedom and independence of the United States of America.

Voting Record

Central American Free Trade Agreement (CAFTA)

In July of 2005, the Central American Free Trade Agreement was passed by the House 217-215. The agreement opened free trade agreements with the Dominican Republic, El Salvador, Costa Rica, Guatemala, Honduras, and Nicaragua. Ron Paul voted against CAFTA.

Ron Paul voted against CAFTA.