“I’m Optimistic”
Ambassador Antonio O. Garza, Jr. speaks on U.S. – Mexico Relations
At the World Affairs Councils of Houston and Dallas

Houston, Texas - March 24, 2004
Dallas, Texas – March 25, 2004

It feels good to be back in Texas and while I’ve got to admit that I miss serving this great state, it’s an extraordinary time to be representing the United States in Mexico…

It is almost a cliché to say that the destinies of our two nations are forever linked, but it’s also something that I came to understand long ago growing up along the Texas-Mexico border. I wasn’t quite sure where I would begin this speech but I knew where I would end...that I’m optimistic - perhaps by nature - but optimistic, nonetheless, about Mexico and the region as a whole.

Latin America and Mexico seldom lead the evening news these days. And that’s probably a good thing. We are generally at peace with one another and share common values about democracy and open economies.

But the fact is that while removed from the turmoil we see elsewhere, this hemisphere is not immune from its reach. Elected leaders continue to grapple with political, economic, and social tensions. Venezuela’s political leadership is of concern as we see increasingly anti-democratic actions by President Chavez. Cuba’s people are still struggling to gain basic rights, and Haiti reminds us what happens in cases of extreme inequality and insecurity.

Why should we care? Because the Western Hemisphere is our home. Our economies, our security interests…our destinies…are increasingly linked with those of our neighbors. We should want an inter-American community that is bound by freedom and democracy. We should want secure borders. We should want our neighbors to prosper through free trade. Perhaps more than anybody, Texans understand that. Last year Texas exports totaled 99 billion dollars, much of it going to Latin America and Mexico. Texas and the U.S. must continue being leaders in the hemisphere because it is the smart thing to do - and it’s the right thing. If not, the headlines from seemingly far away places might soon be those closer to home.

At January’s Summit of the Americas, 34 democratic leaders from the Western Hemisphere spelled out a common vision for the region. They pledged to fight corruption, spur growth, reduce poverty, and improve health and education. To do so, leaders agreed to a number of concrete measures with deadlines. For example, by 2005, they intend to reduce the cost of setting up a business, and provide AIDS therapy to at least 600,000 people. By 2008, they agreed to cut in half the cost of sending money from the U.S. back home, monies that for many countries in the hemisphere represent the single largest source of investment.

It was fitting that the Summit took place in Mexico. The country has served as a bridge to the rest of Latin America by becoming a model for democracy and free trade. In 2000, we witnessed a historic change in government when President Fox broke 71 years of one-party rule, paving the way towards a more open and democratic Mexico.

On the economic front, Mexico’s disciplined monetary policy has led to inflation falling to its lowest level in the last 34 years. Last year, interest rates also reached historic lows, coming in around six percent. Mexico has begun developing a mortgage market, and Mexican bonds have enjoyed investment grade status since the year 2000. Government deficits are under control, and Mexico is one of the most active trading countries in the world.

But much more can and should be done. As you may know, needed economic reforms in the labor, fiscal, and energy sectors stalled in a divided Mexican Congress last December. It’s during such times that some Mexicans may yearn for old style, one-party executive efficiency, but one needs to remember that democracy brings with it stronger, independent legislative and judicial branches and the prospects of truly sustainable growth.

It goes without saying that respect for the rule of law is also essential for investor confidence. President Fox is presenting to his Congress comprehensive reform of the justice system – from the police, through the courts, to the lawyers themselves. He aims to make the system more transparent and less prone to corruption.

Earlier this month, Presidents Bush and Fox had a very productive visit at Crawford. In my eyes, it reconfirmed the importance that our President places on his relationship with President Fox and the partnership that we enjoy with Mexico.

As you might imagine, whenever these two Presidents are in a room, migration is bound to come up… and it did. At Crawford, President Bush cautioned against expectations that Congress would approve any broad-sweeping migration reform during an election year, but he also left no doubt as to his commitment.

It seems like there is now more intense debate on migration within our own nation than between our nations. In fact, a recent poll showed Texans split on President Bush’s immigration proposal. Given that Texans have traditionally been more open on migration, the poll is indicative of the deep divisions that exist nationwide.

The question of who we let in and how we assimilate them is emotionally-charged, because it’s a question of identity. Samuel Huntington recently claimed that immigration challenges our national identity; I say that immigration has created it. Our country is one made of immigrants, whose character, hard work, and talent have contributed to American society and helped make our economy the largest in the world and our way of life the most envied.

This past January, President Bush outlined his vision for immigration reform – one that takes into account not only market forces, but economic realities as well. This was a bold step based on principles he has held as long as I have known him.

Since the President announced this plan, it seems that no one is completely happy, and maybe that’s how it should be. The plan does not guarantee an easy path to permanent residence or citizenship for those people who have broken U.S. laws, nor does it call for massive deportation of those same people. What it does do is offer hope to migrant workers and their families, while allowing law enforcement to focus on those who truly might do us harm.

And indeed, we have been fortunate to have a neighbor like Mexico in the war against terrorism. President Bush has made it clear that the only option for the United States and the world should be total victory in the war on terror. We’re dismantling the al-Qaida network, leader-by-leader, and hunting down terrorist killers, one by one. And will finish the task of helping Iraq make the transition to democracy.

While we were disappointed that Mexico did not support us at the United Nations, they have been a steadfast ally in our day-to-day counterterrorism efforts. Secretary Ridge and his counterpart Secretary Creel recently met in Mexico to set joint goals and objectives for continuing our efforts against international threats. Mexico and the U.S. have each taken actions based on their own best interests, yet have done so in a truly cooperative fashion. Both countries know that if we fail in this area, then terrorist actions will hit not only their targets, but undercut our shared vision of growth, security, and opportunity for both countries.

We are sharing sensitive information to screen and detect potential terrorists seeking access to the U.S. and Mexico. These efforts have resulted in the identification and disruption of numerous smuggling operations involving individuals who sought to harm our countries.

But both leaders also agreed that, regardless of the status of the person, migrants not seeking to do harm should be treated with dignity and respect. I recently went to the Mexican border southwest of the Arizona desert to see first-hand the route traveled by so many people seeking to cross into the United States. I was told that human traffickers - or “polleros” - often fed the men, women, and children drugs to keep them calm as they waited.

Polleros rape women, kidnap children, and sell girls and boys into prostitution. They abandon groups of migrants with no water in a huge desert, with the promise that the U.S. is just two hours away. The reality is that their dream is two days away by foot. Polleros don’t care if people make it out of the desert alive, but our governments should.

It is our joint responsibility to disrupt this cycle of inhumanity and ensure that lives are not lost this summer in the desert heat and that people return safely to their homes in Mexico. In my mind, that is why we need both immigration reform and targeted enforcement initiatives, such as the Arizona Border Control operation announced this month. The program uses some technologies originally developed by the military to assist border agents in dangerous terrain. Our goal is clear - to save lives, while effectively controlling our borders.

Perhaps one of the areas in which we have come the furthest is law enforcement. Fifteen years ago our cooperation with Mexico in law enforcement was virtually non-existent. Many Mexicans saw the U.S. ‘war on drugs’ as a war on Mexico. I remember traveling to Monterrey, Mexico with then governor George Bush. In a speech he gave, he was applauded for his willingness to speak frankly about the demand side of the drug problem, and not merely point a finger at Mexico.

Today, Mexico wants to work with us and we with them. By developing a relationship based on the twin pillars of respect and trust, we’ve seen real results. In partnership with U.S. authorities, the Mexican government has dismantled drug networks and seized large quantities of drugs. Mexican authorities reported arresting over 26,000 criminals involved in narco-trafficking since December 2000. And a record 31 fugitives were extradited to the U.S. in 2003 to face justice for serious crimes.

Another area of bilateral cooperation is trade. Through NAFTA, Mexico has become the United States’ second-largest trading partner. Trade between our nations has tripled… The state of Texas accounts for almost 40 percent of all U.S. trade with Mexico… From Brownsville to El Paso onto San Diego, U.S. border communities have become vibrant trade centers, and our border states and nation as a whole are economically stronger because of that.

But let’s not kid ourselves, while the border benefits from a significant part of that trade, poverty rates in our border communities remain twice as high as the rest of the state, and per capita income is lower. It’s clear that here in Texas and across the nation we must keep investing in border communities so that they have the capacity to deal with the demands of trade and high growth that our state and country benefits from.

Likewise, Mexico must work to ensure that all sectors and regions in the country are able to take advantage of NAFTA. As the global market becomes increasingly competitive, it is essential to provide people the most essential tool of economic progress: a sound education. This is clearly true of Mexico, whose economy has advanced to the point that it no longer competes solely as a low-wage nation, but rather must take advantage of a higher skilled and educated workforce.

You and I also know that if there are obstacles to the flow of capital, such as over-regulation, lack of predictable energy supplies, or the inability to collect government revenues, markets react. These obstacles can drive investment away from Mexico to more attractive climates, limiting the opportunities for those that might labor productively in their homeland.

So as Mexico grapples with reform, it’s not surprising that there is frustration. A countrywide poll last fall found that only 1 out of 4 Mexicans believes that exports to the U.S. have increased under NAFTA – despite the fact that Mexico now exports more than twice the 1993 amount. This is a challenge for all of us: to tell the real trade story. Growing anti-market sentiment in Mexico – and in Latin America for that matter – isn’t so much a move away from a belief in markets, but a feeling that governments are not responding quickly enough to allow markets to meet their needs.

This is something that Presidents Bush and Fox recognized in 2001, when they announced a new initiative, the Partnership for Prosperity, commonly known as the P4P. The P4P is a public-private alliance announced by Presidents Bush and Fox in 2001 to bring the benefits of NAFTA to all Mexicans.

Under P4P, American and Mexican companies have sponsored concrete projects to expand access to capital, to share technical expertise, and ultimately, to build capacity for future growth. One program has trained more than 70,000 primary and secondary school teachers in Mexico to develop students’ technological skills. Another enables low-income families to buy higher-quality construction materials and receive technical assistance in homebuilding.

These activities not only help raise the professional level of the workforce, but also help enrich the overseas communities in which these companies reside and operate. I firmly believe that global businesses can and should use their power and leadership to help create competitive business environments - and part of creating those environments is making sure that the markets work for those that other systems have failed.

Don Mohanlal, the executive vice president for the International Youth Foundation, once stated: "Business cannot succeed in societies that fail." It’s not just a matter of doing good business, it’s about doing the right thing as global citizens. Creating sustainable business climates shows our leadership. Our conscience. Our commitment to the long-term.

So yes, I am optimistic…because I serve a President in President Bush who understands the region and is committed to the long-term…and have met a President in President Fox who shares his vision. I’m optimistic, because I’ve met business leaders who are committed to help Mexican communities take advantage of increasing globalization and combat poverty. And I’m optimistic because other leaders in our hemisphere have committed themselves to fight corruption, promote economic growth, and enhance health and education.

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