Two actionpacked conversations. Were going to talk to the leaders of the industries that will be influencing the session. Around 4 00 will be joined by the secretary of commerce. Let me set the stage for a couple minutes then well get into our conversation. Those of you who follow our work w we try to accurately define problems. We have a quaint affinity to evidence and are best efforts to come up with rigorous facts on which people can have a good fight. We try to reform and develop practical and Creative Solutions we think and generate the kind of broadbased support to pass laws and resilient laws that have the actual investment of the American Public in their success. Finally we advocate. Action. A cb4 we dont think the world will fall to its knees just based on the genius of our insight. But we get up in the air and mix it up. In there and mix it up. It is not a gentle sport. It requires a real commitment and investment. We are proud to play that role where we can. For the last several months we have an in discussion around nafta because it is critically important and is far from perfect. Fax you are all generally familiar with, canada and mexico are responsible for one third of our nations exports. 43 of our nations 50 states trademark with canada and mexico than any other countries. And millions of jobs, some say 14, some say 11 come say 11, some time, this is an agreement that obviously needs improvement. Is 23yearold it is 23yearolds. It is 23 years old. It did not engage intellectualproperty in a way i think we believe it should. Were going to hear opportunities in the Energy Sector which could not have been contemplated when the agreement was first struck. But more than that this issue is emblematic of one of the core questions that where grappling with as a country what is the future of our nations economy and role in the world . What is the future of American Workers in the Global Economy . The idea of the American Dream that so many of us take for granted in this country is not real and the minds of many people who have lost jobs in the last decade. Flat, cost ofn college has multiplied by a factor of three. It a lot of that is channeled into the conversation into trade and inequity, which has become the nafta discussion. We believe this is an issue that is essential, but also essential to bring together the fabric of the country. With that heroic opening, i would like to now turn to two gentlemen who lead industries that are critical to our domestic security and our global power. Energy and agriculture industries. I want to introduce chip. Deal. He real a thirdgeneration farmer with over 1400 acres of grain production, soy, wheat. His family has been working since the 1700s. Chip is not new to the conversation and not new to policy. He has been working with the usda farm ranch committee. By chair of the u. S. Farmers and ranchers alliance. I think the first easter dinner to chair the corn growers. Chair the corn grower. Jack gerard, you are probably familiar with. The ceo of the foundation for the oil and gas industry. State, globale level. But some people dont fully appreciate that he also serves the industry. The core of the training, certification, best practices. A lot of what happens is below the waterline. It is incredibly important work. Jack is no stranger to these issues. Previously worked with the National Miners association. Two gentlemen who understand the importance of these issues. Let me start with you, chip. You run a farm. Why are you here . Why you care about the north American Free trade agreement . Chip i do run a farm. I live and work on a farm everyday. I live south of washington dc where most people dont think there is any farming going on. It is important to me because it has been working. Mexico is the biggest buyer of american corn right now. About 525 million bushels every year. They have been easy to deal with, they want our product and right now with the way input and crop prices are, nafta and mexico and canada are the deal for americas corn farmers. That the seamlessness of relationship became higher in transaction costs, what do you think happens . What fills that void . Chip what happens is we have other countries that grow corn like we do. They dont grow good quality corn like the u. S. From her does but brazil and argentina are waiting for mexico to buy foreign. Theyre are looking for customers just like we are. We need to work everyday day to protect that market that we have worked for years to build up. I have been to mexico on corn trade missions. They like our product, they like dealing with us, they like the quality. And it makes sense to have corn going from this country into their country on railcars, sometimes trucks. Vessels across the gulf of mexico. It is an easy deal for us and them and it makes sense. Jack, lets turn to energy. The Domestic Energy industry has exploded. Coincidence wes will leave to the crowd to decide. But the idea of north american which selfsufficiency, now actually feels like it is within our grasp. I wonder if you can talk not just about nafta but the importance of the integration of the north American Energy economy and what you see as the potential they are. There. Jack thank you for having me. A couple points, think you hit it right on the head. A few decades ago if you would of thought or projected that today the United States leads the world in oil and gas refining, yet just a short few years ago we were building to importminals natural gas to benefit the farmers and ranchers and others out there. Really what has happened is remarkable. When you put it in the context of nafta and you look at it more holistically across north america, we now have an integrated market that essentially is interdependent on each other. We have situations where we are importing heavier crude oil from canada. We refine it in the United States. Taken in froms we mexico, turn into gasoline and send it back to mexico. Taking place today across the broader north America Energy market. Byding experts believe that 2020 we could believe we could be energy selfsufficient. Selfsufficient as opposed to independent because what we mean by that is we have a capability to produce as much as we consume right here in the north american continent. Nafta, the stability it is brought in terms of our ability to move across borders with full import and export, has been more beneficial. Dead the realthe beneficiary is the American Consumer because the more you bring the law supply and demand into play, the efficiencies that come with crossborder trade, even the farming and ranching Community Get to experience the lower fuel costs. Aaa estimates the average americans is over 500 a year at the gas pump because of lower gasoline and diesel fuel prices. What is very important as we enter into this debate is to recognize the way the markets work, the real value for the u. S. In that broader context of the north American Free trade agreement. Jason let me ask you to were not going to forget about canada. We tend to focus initially on the question of our relationships with mexico. The mexican approach to energy in terms of foreign investment, openness of market, are fundamentally different today than when nafta was adopted two decades ago. How important an opportunity is that . How much has changed in terms of u. S. Investment in mexico . What you see as the future there . Jack it is still important and still in the early stages. Mexico has fundamentally changed their approach to energy just in the past few years. Different than what it was 60, 70 years prior. Have seen is stability brought to us by nafta and other regulatory regimes is the ability now for us to invest in this broader marketplace. Mexicans being more open to that. If you look at some of the sales in the gulf of mexico and mexico side, you see very significant investments in mindanao from u. S. Companies coming in from u. S. Companies. Foreign investment, for in job creation. It benefits us up and down the value chain. The Mexico Energy approach today is very different than it was a short your a few short years ago. Nafta brings us some of the certainty you need and the confidence you can have bringing judicial systems and others that gives certainty to those investment dollars to find a friendly place to land. Chip, if the environment became less favorable to u. S. Companies, what the you imagine happens with those mexican resources . Chip one of the concerns problems is the capital will go where it is most wanted. When you look at our business, we are a global industry. Were trying to find places where we had the greatest opportunity but also where we are welcome. The situation in mexico in particular provides great certainty to us now. Anything that would discourage that were create uncertainty or create uncertainty would perhaps chill the uncertainty chip stability. Day,ts fluctuate every every hour on the chicago board of trade. Ever since there has been talk about getting out of nafta, all add commodities have trended down. When we decided not to get out of nafta the market trended up. There are agriculture and farmers will be cant afford to drop any more than where they are. If you take u. S. Corn out of the market and the picture, then stability and uncertainty played the role. We grow 50 billion bushels of corn every year this country. We export about 2. 5 billion. Trade has been somewhat flat for us over the last several years. Any disruption in trade has a big impact on our farm costs, our financial picture. We have to make sure we dont disrupt that in any way. Jason are there other Global Markets you could see shifting american markets to . , we would like to go into the asian market. That is where the growing population is. We have some issues. We are working on china. The other asian markets, china japan, korea, we would love to get more in there. But when you have a Business Partner who is right across your border and the ease of trade back and forth, thats the best way to go. Sure you agree that no human enterprises perfect. Are there ways that you can imagine the agreement strengthening for u. S. Export, jobs . Chip any agreement can be strengthened. This is 23 years old. Work with theto administration and the usda as far as making the channels of trade clearer and easier. It works very well for us right now. You can always strengthen an agreement. We are open for negotiation. Jason jack, same question. I know the fundamentals you have said our first said are pretty sound. View to be clear, our comes from the energy standpoint. I cant speak for other sectors to where it might be important for them to update, modernize. But from our standpoint we believe the best principles are was the free market principles. You protect the environment, you protect the workforce. Then you allow the free flow of goods and commerce. Because ultimately it will find its equilibrium, which then benefits the consumer. I think at the end of the day as you look at north america as a continent, we talk about energy selfsufficiency. Activity inxport this country has increased significantly or are the same time we are moving away from other sources of Energy Around the world, thus making us energy selfsufficient. The applications from that are much longer than just the larger than just the trade question. The geopolitics of Energy Around the globe have changed dramatically. Is really becoming the epicenter of energy in the world. Again, something no one would have thought 10 years ago. Jason say it little more about interconnectedness. A lot of people imagine trade as you build something and you sell it to someone else. Linear. But there is a lot of integration between crude mexico going to the u. S. , then going exico and other markets. How different would it be if proverbially the treaty was ripped up . I think suggested in more political forms. What with the industry do in that reality . Jack again, uncertainty creates great concern. We left this behind somewhere, but we have shown a quick diagram, if you will, of the interdependence of the trade in the north American Community between mexico, the u. S. , canada and the u. S. The markets are finding their balance in her equilibrium. For example, we had todayries in the gulf that we turn right around and that same refiner has exported over 9 Million Barrels of refined product right back to mexico. In many ways, that interconnection is creating 3000 jobs in houston, putting americans to work. What we are doing is taking a mexican crude oil product, bring it to the United States and adding value, turning it right back around to consumers in mexico. We see the same dynamic and relationship with canada and others in terms of natural gas imports and exports. The graph is you a simple visual to show you the quantity of the movement, both north and south, on both borders. Jason lets turn to our polite neighbors to the north. The agriculture connection to canada are as significant as mexico. Corn and grain to mexico. Whats the dynamic look like with our northern border . Chip wheeler with we work with canadian corn growers as an organization. We dont send a lot of corn to candidate we send corn byproducts. Sweeteners, ethanol goes into canada. Livestock. They feed corn to the cattle in canada and a important a lot of livestock products. It is indeed a big part of our trade barrier there. Jason in a few minutes about theask you parlor game of prognostication. Always challenging, probably more so challenging now than ever before. Do you think congress should resolve this . Should the administration . Obviously something is going to change with this agreement. Do you have any suggestion for the best process to achieve that . Im looking at you, jack. Jack i was waiting for chip to enter that one. Answer that one. President has given a notice to congress in their interaction back and forth, think they both have a role to play. The appropriate level of each at the end of the day, we need to balance that with the broader u. S. Interests. It is hard to predict at this point in time as i think we are in the early stages of a substantive conversation. We have had a lot of Public Discourse about that is good or bad, etc. , but now it is time to really sit down and back to the point you made about bipartisan, we need to focus on the facts and reality. That is an area where i think energy brings a cooler effect to the broader conversation. When you look at that interdependence today, a greatly benefits the United States of america. I think we want to take a breath and think long and hard about how we approach any potential changes, and then clearly understand the implications, not only for business, investment, different industries, but ultimately at the end of the game, the American Public and American Consumer. In many instances they are the ones concerned about these relationships and these agreements. And so we should not lose the Vantage Point of that perspective. Jason chip, i know like us you are a big fan of secretary center purdue. He was very engaged in these questions. Say what you can about your interactions. Chip as we know, the administration will be heavily involved with what happens with nafta. We can hope for, along with the help of mr. Purdue, would be to bring people like me to the table, corn, soybeans, wheat, any agriculture commodity bring us to the table. We know that nafta has worked. We dont want to have any part of blocking trade. So they bring a sin, work with all of us as a unit, and make sure that if they are going to be bring a sin, work with all us ruralarmers out in america are making less money and having trade issues, it affects people way down the line. It affects thousands and thousands of people. I could keep going for a thee, and i may, but with but i will throw to the audience to ask questions if they like. If folks could just announce who you are. If we have a microphone back here. Why do you stand up and project there you are. Hello. Jack, two years ago there was a for crude. T your organization spent a lot to make it happen to allow u. S. Producers to export crude. But you did not imagine that the biggest threat to energy trade would come from a republican administration. I wonder obviously this is a process. Are your members prepared to spend as much resources and efforts to keep nafta energy trade flowing . Is that a comparable effort or is there something you are going to do along with other things . We work on a lot of different issues. You talked about the u. S. Crude oil ban being lifted. I think it is very consistent with the broader conversation were having today about trade generally. We operate in the foundation of freetrade principles. Our view is the American People benefit most when we allow for free trade, when we allow for open borders, and allow the markets of a capital to find what is friendly to invest and produce that energy for the benefit of consumers. Usc what happened in the marketplace as a result of lots of supply coming on, primarily driven by Technological Advancements on horizontal drilling. Yet again, the consumer is the major beneficiary. Overtime, we believe we have a constructive dialogue with the administration and with congress on this issue and our hope and expectation is as we ground this and affect the conversation, the outcome will be positive. We will eventually get to where we be in this conversation and many others because we will grounded in reality and fact. I think it is premature to project exactly where it is going to go. But clearly we want to be engaged in net dialogue. Right now it is a very constructive dialogue with the secretary and others to make sure we have open avenues of communication. Jason other questions . You could pull over thank you. Im a reporter from the toronto star. In april the president complained about canada on a few issues. Some of which are known as bilateral europeans like of lumber. He also mentioned energy. None of us in canada really knew what he was referring to. Did you know what he was talking about . Are there any irritants that you can see