Val­ley fears threat to shut the bor­der

San Antonio Express-News (Sunday) - - Front Page - By Lynn Bre­zosky STAFF WRITER

MIS­SION — Al­pha XL Mold and Tool, the Guer­rero fam­ily’s small but bustling plas­tic-mold in­jec­tion shop, sits on a street that’s part neigh­bor­hood, part in­dus­trial zone. The air is fra­grant with emis­sions from a nearby cit­rus-juice plant.

The busi­ness founded by Julio Guer­rero is near one of the many thriv­ing in­dus­trial parks along the Texas-Mex­ico bor­der.

Or­ders come in from maquilado

ras, or as­sem­bly plants, a few miles across the Rio Grande in Reynosa — for steer­ing-wheel cas­ings for a French au­to­mo­tive com­pany, drill mold­ings for a ma­jor U.S. power tool maker, tiny su­ture wings for a multi­na­tional med­i­cal sup­plier.

En­gi­neers fash­ion de­signs on com­put­ers, graphite drills carve steel into pat­terns and gi­ant ma­chines run­ning on com­pli­cated soft­ware code pre­ci­sion-cut sheets of metal.

Prox­im­ity is key for Al­pha XL. Guer­rero’s em­ploy­ees can make mod­i­fi­ca­tions in a few days and de­liver the prod­ucts to as­sem­bly lines work­ing non­stop to fill or­ders from

across the globe. With 10 em­ploy­ees, the com­pany is a tiny player in the fre­netic world of cross-bor­der com­merce.

Pres­i­dent Don­ald Trump’s re­cent threat to close the bor­der puts his busi­ness at risk and jeop­ar­dizes the jobs of thou­sands of work­ers on both sides of the bor­der.

Sud­denly, Guer­rero finds him­self in the mid­dle of a strug­gle be­tween na­tional se­cu­rity, as Trump de­fines it, and the transna­tional free trade on which he’s staked his fam­ily’s fu­ture. He moved to Mis­sion from North Carolina be­cause of fac­tory clos­ings there.

“The econ­omy is ac­tu­ally bi­na­tional in South Texas,” said Guer­rero, who holds dual U.S.-Mex­i­can cit­i­zen­ship. “There’s lots of busi­nesses now that de­pend on each other ei­ther way. Busi­nesses in Reynosa de­pend on the U.S., and U.S. busi­nesses de­pend on Mex­i­can.”

The pos­si­bil­ity of seal­ing the bor­der had been un­think­able — un­til Trump or­dered the hours­long shut­down of the San Ysidro cross­ing link­ing San Diego, Calif., with Tijuana, Mex­ico.

U.S. Cus­toms and Bor­der Pro­tec­tion closed the cross­ing on Nov. 25 af­ter mem­bers of a Cen­tral Amer­i­can mi­grant car­a­van, many of them flee­ing their na­tive Hon­duras, rushed a bar­rier.

Trump has said he’s not afraid to close the nearly 2,000 - mile bor­der, which stretches from Brownsville to San Diego, “for a long time” if need be to stop im­mi­grants from cross­ing il­le­gally into the United States.

Slow­ing to crawl

For Guer­rero and many oth­ers, these are some of the rou­tine sights: long lines of north­bound semi-trail­ers ap­proach­ing the Pharr-Reynosa In­ter­na­tional Bridge; Mex­i­can fam­i­lies wheel­ing the day’s load of McAllen shop­ping into area ho­tels; truck traf­fic at re­frig­er­ated pro­duce sheds stor­ing toma­toes, av­o­ca­dos and pep­pers bound for su­per­mar­kets across the United States.

It’s com­mon for maquiladora man­agers to live on the U.S. side and cross into Mex­ico daily for work.

Com­merce is at the heart of life on the bor­der.

Mex­i­can shop­pers, for ex­am­ple, ac­count for 30 to 40 per­cent of McAllen’s re­tail sales, ac­cord­ing to the Fed­eral Re­serve Bank of Dal­las.

Richard Cortez, a for­mer McAllen mayor who’s now county judge-elect for Hi­dalgo County, said he was dumb­struck when he heard Trump’s threat.

“To me,” he said, “even think­ing about do­ing that is just id­i­otic — it’s just crazy.”

More than $1 mil­lion worth of trade crosses the South­ern U.S. bor­der ev­ery minute, say re­searchers at Texas A&M In­ter­na­tional Univer­sity in Laredo. Some $650 bil­lion in trade came through Texas ports in 2015, di­rectly or in­di­rectly sup­port­ing nearly 1.6 mil­lion Texas jobs and adding $224.3 bil­lion to the gross state prod­uct, the state comptroller’s of­fice re­ports.

It’s hard to know what to ex­pect from a bor­der clo­sure be­cause there have been so few of them.

The clos­est the fed­eral gov­ern­ment came in re­cent mem­ory was af­ter the 9/11 at­tacks — and even that fell short of a bor­der clo­sure. Af­ter Pres­i­dent Ge­orge W. Bush de­clared a “Level 1 Alert,” cus­toms of­fi­cers searched ev­ery ve­hi­cle cross­ing into the United States. Trade slowed to a crawl. The city of San Diego de­clared an eco­nomic emer­gency.

There was a sim­i­lar cri­sis when Pres­i­dent Ron­ald Rea­gan or­dered closer in­spec­tions af­ter DEA Agent En­rique “Kiki” Ca­marena Salazar was kid­napped on as­sign­ment in Guadala­jara, Mex­ico. Traf­fic on both sides of the bor­der backed up seven hours or more.

Ger­ald Sch­webel, ex­ec­u­tive vice pres­i­dent of the Lare­dobased In­ter­na­tional Bank of Com­merce, said he couldn’t re­call any­thing like what Trump has pro­posed. To the con­trary, when Laredo’s World Trade Bridge was dam­aged by high winds last year, re­pair­ing the dam­age as quickly as pos­si­ble was a top pri­or­ity, Sch­webel said.

Last month’s brief clo­sure of a sin­gle cross­ing point opened only a small win­dow on what to ex­pect from a full-scale bor­der clo­sure.

The five-hour shut­down in San Diego cost an es­ti­mated $5.3 mil­lion in lost trade, based on spend­ing data tracked by the San Ysidro Cham­ber of Com­merce. Paola Avila, head of both the bor­der­wide Bor­der Trade Al­liance and San Diego Cham­ber of Com­merce, said it took Cus­toms and Bor­der Pa­trol three hours to get ev­ery­thing back on­line once the de­ci­sion was made to re­open the cross­ing.

Free traders on edge

Talk of a sud­den shut­down has peo­ple on both sides of the bor­der — who reg­u­larly travel back and forth — fear­ful of get­ting stuck in the other coun­try.

“So­cial me­dia is all over the place cre­at­ing panic with Mex­i­can vis­i­tors dur­ing this hol­i­day sea­son,” Sch­webel said. “We can­not take this lightly. Ask Wal­mart, Ama­zon, FedEx, UPS, H-E-B what clos­ing the bor­der for one day would cost them. … Can’t play games with this.”

Keith Pa­tridge, pres­i­dent of the McAllen Eco­nomic De­vel­op­ment Corp., said com­pa­nies have been call­ing him fran­ti­cally, ask­ing ex­actly what shut­ting down the bor­der would en­tail. He tells them he’s not sure.

“We’re re­ally kind of in un­charted wa­ters, I guess, be­cause the ac­tual idea of clos­ing the bor- der is a rel­a­tively new con­cept,” Pa­tridge said “I know it’s pos­si­ble, be­cause they just did it down in San Ysidro.”

While man­u­fac­tur­ers think talk of a pro­longed shut­down is mostly hot air, he said many are stock­pil­ing both raw ma­te­ri­als and fin­ished prod­ucts just in case.

“If you can’t de­liver your prod­uct to an au­to­mo­tive plant some­where in the U.S. and you shut down your pro­duc­tion, it could cost you $750,000 to $800,000 an hour for ev­ery hour that the as­sem­bly line is not run­ning,” he said. “They’re now look­ing at, ‘Well, I’m in­creas­ing my stock of fin­ished goods, I’m in­creas­ing my stock of com­po­nent parts on both sides of the bor­der so that I can keep my plant run­ning.’ Which is an in­creased cost, which is dis­rupt­ing the nor­mal flow of pro­duc­tion.”

Whether or not it sways Trump, CBP has been get­ting an ear­ful about the po­ten­tial trade losses.

Avila said rep­re­sen­ta­tives of pro­duce sup­pli­ers and other in­dus­tries have spo­ken with mem­bers of CBP’s trade di­vi­sion about ways to mit­i­gate the enor­mous costs re­lated to clos­ing the bor­der — ev­ery­thing from fruit rot­ting in stor­age fa­cil­i­ties to fac­to­ries not re­ceiv­ing the parts they need to as­sem­ble au­to­mo­biles and elec­tron­ics.

CBP “re­quested the call to get some more in­for­ma­tion — de­tailed in­for­ma­tion about the eco­nomic risks — be­cause they are in­ter­ested in that,” she said. “CBP’s tasked with both bor­der se­cu­rity and bor­der fa­cil­i­ta­tion.”

A CBP spokesper­son con­firmed the agency “has been in com­mu­ni­ca­tion with our stake­hold­ers on our con­tin­gency plan­ning.”

“CBP, they have op­er­ated the ports for years. They know the amount of com­merce that goes through there. They un­der­stand the im­por­tance,” Avila said. “Now whether the White House un­der­stands, I’m not sure.”

Bor­der com­mu­ni­ties aren’t the only ones on edge.

The fight to keep the United States from with­draw­ing from the tri­lat­eral North Amer­i­can Free Trade Agree­ment be­came a na­tional one when non­bor­der states re­al­ized how de­pen­dent they were on duty-free im­ports and ex­ports to Mex­ico and Canada.

Man­u­fac­tur­ers con­stantly are mov­ing parts and fin­ished prod­ucts back and forth, and Mex­ico is a huge mar­ket for U.S. agri­cul­tural goods such as corn, soy­beans, pork and dairy prod­ucts.

In a back­handed way, the tit­for-tat trade tar­iffs sparked by Trump have high­lighted that re­al­ity. In re­sponse to U.S. tar­iffs on alu­minum and steel, Mex­ico im­posed heavy du­ties on prod­ucts like bour­bon from Ken­tucky, pork from Iowa and nails from Mis­souri.

“There are ac­tions that Mex­ico is tak­ing that are laser-fo­cused on cer­tain con­gres­sional dis­tricts, cer­tain states of the U.S. that have a lot to lose,” said Wol­fram Schaf­fler Gon­za­lez of Texas A&M In­ter­na­tional Univer­sity’s Texas Cen­ter for Bor­der Eco­nomic and En­ter­prise De­vel­op­ment. “There is not a sin­gle state that does not ben­e­fit in one way or an­other from trade with Mex­ico.”

De­pen­dent on trade

Nev­er­the­less, the wor­ries are more acute — and the threat of eco­nomic dam­age from a bor­der clo­sure more pointed — among South Texas res­i­dents and busi­ness peo­ple.

It’s tir­ing to be on the bor­der and caught in both a trade war

and bat­tles over im­mi­gra­tion pol­icy, said Mon­ica Weis­berg-Ste­wart, a McAllen busi­ness owner who is im­mi­gra­tion and bor­der se­cu­rity chair­woman for the Texas Bor­der Coali­tion.

Bor­der-cross­ing fa­cil­i­ties and staffing — in­clud­ing in­spec­tors — still hasn’t caught up with the tighter, post-9/11 se­cu­rity, she said. The Rio Grande Val­ley has been ground zero for the re­cent surge of un­ac­com­pa­nied mi­nors cross­ing into this coun­try, much as it was dur­ing a surge of Brazil­ian im­mi­grants un­der Pres­i­dent Ge­orge W. Bush.

“We do agree with the pres­i­dent that Congress has got to get this solved on im­mi­gra­tion re­form, be­cause be­hind one group of in­di­vid­u­als that’s coming is an­other group and an­other group and an­other group,” Weis­bergSte­wart said. “We hate see­ing the fi­nan­cial se­cu­rity of our county be­ing jeop­ar­dized be­cause Congress can’t get the laws in place.”

Back at the mold shop, Felix Guer­rero, Julio Guer­rero’s son, said most Amer­i­cans don’t un­der­stand how de­pen­dent they are on so-called bor­der­plexes such as the lower Rio Grande Val­ley.

A whole in­dus­try has risen to haul fruits and veg­eta­bles north, and beef, poul­try, milk and grains south. Count­less truck driv­ers have pulled trailer-loads up In­ter­state 35 from Laredo to Min­nesota. Au­to­mo­tive plants around the coun­try roll out cars, trucks and SUVs made with elec­tron­ics and other parts that may have crossed the bor­der sev­eral times.

Reynosa has be­come a huge hub for med­i­cal sup­plies bound for emer­gency rooms and doc­tors’ of­fices across the United States.

“They say, ‘Oh, well, we can bring that (man­u­fac­tur­ing process) back to the U.S.’ But that quickly?,” Felix Guer­rero said. “I prom­ise you, there’s some­body right now in a hos­pi­tal wait­ing for com­po­nents — things that we process and make ev­ery day that they needed prob­a­bly yes­ter­day.”

“Even think­ing about do­ing that is just id­i­otic — it’s just crazy.”

Hi­dalgo County Judge-elect Richard Cortez, talk­ing about Pres­i­dent Trump’s threats to shut down the bor­der

Bob Owen / Staff pho­tog­ra­pher

Julio Guer­rero, ower of Al­pha XL Mold and Tool in Mis­sion, ex­plains the mold-mak­ing process for cast­ing a plas­tic auto part.

Pho­tos by Bob Owen / Staff pho­tog­ra­pher

A long line of trucks wait on the Pharr-Reynosa In­ter­na­tional Bridge to en­ter the United States as oth­ers make their way into Mex­ico.

Felix Guer­rero pro­grams a tool-cut­ting ma­chine. He said most Amer­i­cans don’t un­der­stand how de­pen­dent they are on so-called bor­der­plexes such as the lower Rio Grande Val­ley.

Julio Guer­rero ex­plains the mold-mak­ing process for mak­ing a plas­tic su­ture wing used in med­i­cal pro­ce­dure. His firm made the mold, and the su­ture wings are made across the bor­der.

Felix Guer­rero holds a mold-cut­ting tool made at Al­pha XL Mold and Tool in Mis­sion.

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