McCain Gets Lesson in Free Trade: Area Executives Emphasize Benefits of Forming Pacts

(Milwaukee Journal Sentinel)

It did not take long Wednesday for Sen. John McCain to get a handle on how business executives felt about free-trade agreements.

A day after the all-but-certain Republican presidential nominee announced his plan for economic reforms, he addressed about 300 business people gathered at Bucyrus International, the South Milwaukee manufacturer of mining equipment.

At the event, held in a cavernous facility used to build some of the world’s largest machines, McCain was told that it would be a mistake for the U.S. government to back out of trade deals such as the North American Free Trade Agreement.

Tariffs and protectionist measures would backfire on the United States and hurt U.S. companies engaged in international trade, according to a panel of executives that McCain addressed. “If we don’t have free trade, the decision that we made to stay here in South Milwaukee and triple the capacity of this plant is lost,” Bucyrus CEO Tim Sullivan told McCain.

Worldwide demand for coal and other mined resources has fueled a construction and hiring boom at Bucyrus, which is now several years into an economic upswing that some analysts believe could last for years. Bucyrus spent more than $42 million on expansions and renovations in South Milwaukee in 2007 and has more than doubled its employment since $150 million in expansion plans were announced three years ago.

Bucyrus and its Milwaukee competitor, Joy Global Corp., are part of the fast-growing economies of Asia and eastern Europe. Trade agreements have helped fuel international equipment sales. It would be “absolutely crazy” to dismantle the agreements, Sullivan said.

McCain emphasized his support for NAFTA and said that 50% of the oil used in Wisconsin comes from Canada under the agreement. “Canadian government sources have been quoted as saying if there’s a unilateral renegotiation of NAFTA by the United States, then they would obviously consider their options to send their oil to wherever the highest market value would be,” McCain said.