Free Trade Agreement

The North American Free Trade Agreement accord seems to have created a great deal of euphoria (Aug. 13). But I wonder whether any better thought has been given to this agreement than to the tragic tax reforms of the past 12 years that have eliminated the incentives that were the underpinning of our U.S. economy, and complicated tax returns beyond belief.

We have already witnessed the substantial erosion of our industrial base. Are we willing to risk the acceleration of this development with the further migration of manufacturing and jobs to Mexico? And what is to prevent Asia’s big businesses from establishing manufacturing sites in Mexico, thus capturing that market as well as that of the U.S.?

I believe we should move cautiously and first consider changes internally that will bolster our economy. For example, our tax structure could be revised to restore investment tax credits and improve depreciation rates. These incentives should be limited to products where 70% of components are produced in the U.S.

Research and development should receive greater tax credits and government financial support. A sensible capital gains tax should be instituted that would encourage business investment rather than reward stock speculation. Consumer purchasing could be encouraged by restoring the tax deduction for consumers interest.

JULIAN WEINER, Beverly Hills