Trade Off: NAFTA has Been a Disaster for our Nation and its Workers
Why Would we Make the Same Mistake Twice?

by Jonathan Tasini
November 18, 2003
First Published in Tom Paine.com

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A Note From The Author: Almost 10 years ago to the day, the North American Free Trade Agreement passed the House by a narrow margin. A decade later, it's clear NAFTA's proponents were dead wrong -- NAFTA has been a disaster for our nation and its workers. But, more importantly, NAFTA's implementation has valuable lessons for the future, from this week's negotiations over the Free Trade Area of the Americas to U.S. presidential politics to the very question of our country's self-governance. Today's column begins a three-day exploration of these issues.


What were the central claims by the economists, politicians and self-styled, college-educated experts? They promised that NAFTA would generate 200,000 new American jobs, that the relatively small $9 billion U.S. trade deficit with Mexico and Canada would turn into a trade surplus and that the United States would become an export engine of manufactured goods. Mexicans would buy up exported goods from the United States and rocket into the middle class. Canadians would also benefit from new trade opportunities. Supporters of NAFTA were branded "forward looking," while opponents were called "protectionists."


The reality? Using the same methodology NAFTA's proponents wielded, the agreement cost us 750,000 jobs, many of them good-paying manufacturing jobs that were a backbone of America's middle class. The U.S. trade deficit with Mexico and Canada ballooned to $87 billion in 2002. In the United States, workers haunted by the specter of losing their jobs, became even more fearful of forming unions or striking&mash;and companies used that fear to break union organizing drives and drive down wages and benefits. Wages in Canada now lag behind U.S. wages and the average Mexican wage has plummeted.


None of this should truly come as a shock. While proponents waved around numbers about exports from the United States, they would conveniently ignore an obvious outcome: a huge wave of imports coming into the United States generated by cheaper labor across the border. The evidence was in plain site. During the NAFTA debate, the Mexican government ran huge full-page ads in business magazines, touting its teeming masses. In one, a troubled Anglo business executive worries, "I can't find good loyal workers for a dollar an hour within a thousand miles of here." The ad declares: "Yes you can. Yucatan."


Some claims were bizarre. A new, large Mexican middle-class just waiting to be born? Mexico's population was mired in abject poverty, unable to feed their families let alone buy consumer goods like cars. Post-NAFTA, more than one million more Mexicans work for less than the $5 a day minimum wage in the border-area maquiladora industries and eight million more people have fallen from the shrinking middle-class into poverty.


What went wrong? Actually, nothing—NAFTA worked perfectly if one understands that it was an agreement to make life easier for corporations, not people. Blinded by the tens of millions of dollars spent by corporate interests to push NAFTA and the backroom deals made by Bill Clinton to buy votes, Congress either did not see, or did want to admit, that companies were not as interested in exporting goods as they were in exporting jobs. Yes, NAFTA had labor and environmental side-agreements. But, the very fact that they were side agreements, not part of the main text, speaks volumes about the irrelevance of workers to those who dictated the agreements' ideological framework.


So, why would we make the same mistake twice? The FTAA simply recreates the NAFTA model, just on a bigger scale: it would cover 34 countries in North, Central and South America, from Canada down to Chile. It does not contain a single chapter on labor rights. It would gut U.S. laws aimed at protecting the economic, social, environmental, and health and safety interests of our citizens.


We even have a new set of experts and studies to replace the discredited NAFTA promoters (who, typically, slipped into obscurity without being held accountable for their views). In one instance, Florida business groups are flogging a study that predicts that the state will gain 89,000 jobs over 10 years if the FTAA Secretariat is located there. This is utter nonsense—under NAFTA, Florida lost as many as 27,000 jobs and the FTAA, with its far broader hemispheric reach, will expose Florida's citrus and sugar industries to even stiffer foreign competition.


Let's be honest—"free trade" is just a marketing phrase picked up uncritically by college-educated journalists and politicians who probably absorbed the theoretical wonders of free trade in an introductory economics class. True free trade could be written as a 10-page document. NAFTA-style trade agreements are voluminous, carefully-written documents mainly crafted to protect investment and capital rights such as corporate intellectual property. Indeed, rather than free trade, these agreements are tightly-managed trade for special interests.


"Free trade" should be banned from the political lexicon—except that it gives cover to policy makers who fear voter retribution. Perhaps all NAFTA-style trade agreements should carry the equivalent of the cigarette-package health warnings: "Warning: Consuming this product may lead to the loss of your job, lower pay and benefits, the poisoning of your environment and the weakening of your democratic rights as a citizen."


Jonathan Tasini is the national director of American Rights At Work. He may be reached at: jtasini@americanrightsatwork.org. This article first appeared in Tom Paine.com (www.tompaine.com)


Other Articles by Jonathan Tasini


* Jobs Without Power: Working In America




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