The Importance of NAFTA to American Wellbeing

If you're like President Trump, you think the North American Free Trade Agreement is a mistake. You'd be wrong, according to every economist who has reviewed it.

The deal is this: NAFTA contributes a huge amount to each state's GDP as University of Michigan-Flint economics professor Mark Perry demonstrates in graphical form above and table form below.

Numbers don't lie. In summary:

For automotive manufacturing-intense states like Michigan, trade with Mexico ($61 billion) and Canada ($71 billion), last year represented more than 25% of the state’s GDP of $487 billion. Other states with significant automotive production like Texas, Kentucky, Indiana, Tennessee, Ohio, Alabama and South Carolina had trade with Canada and Mexico last year that represented more than 5% of state GDP. For border states like Texas, North Dakota, and Vermont, trade with NAFTA partners represented more than 10% of the state’s economic output in 2016. In total, merchandise trade with Mexico and Canada (exports + imports) last year totaled more than $1 trillion and represented nearly 6% of US GDP.

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