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Back to Subjects - Political Science

NAFTA

NAFTA Effective on January 1, 1994, the North American Free Trade Agreement (NAFTA) was enacted as a new dream, one designed to enhance the economies and production of goods for the United States, Canada, and Mexico. Since its conception, it was, and still remains today a controversy over the “potential greatness and predictive results” vs. the actual facts and figures that have been witnessed. Now, only some five years later, many would agree that this dream has developed into a nightmare for those on all sides of the border. This agreement’s far-reaching and damaging effects have been felt--in the United States-- mostly by the small business owners, and the individual middle-to-lower class worker. I will expand on these points, however, I must also mention the plight of our nation’s neighbors, who share in the consequences of this pact. NAFTA is on its way to marking a decline in the American economy, an increase in unemployment, and a general deterioration in the morale of the workforce in The glorious theory of NAFTA sure sounded innocent enough. In fact, it painted the beautiful picture of North American countries holding hands in a union bound for excellence. Together, they would strive for a common wealth and to each, a revival of imports and exports; thus improving the economic traditions of all. Free trade (eliminating tariffs) between countries and expansion of sales across the border were the main objectives in the agreement, and each side had something to gain through the process(Online, 1). Canada, who imports vast amounts of agricultural products, appreciated the elimination of tariffs on the goods that are brought into their country. For the United States, the opportunities were many. The expansion of trade meant more product needed, therefore more jobs would be created to employ the people. It also allowed for the establishment of manufacturers anywhere in North America without any exchange penalties. This is what made it possible to abuse the cheaper labor in Mexico to make American products and then sell these back to the Americans at the same price. Mexico had bright hopes for the future, also. It seemed they had been granted a more respectable position in international commerce. In addition, it could also provide more jobs for their poverty-stricken public(Creations, 1-5). Collectively, these merits looked great on paper and achieved much support from both democrats and republicans, providing for its passing in both the Senate and House of Representatives. In its only opposition, were mostly labor unions, knowing the effects of the cheaper Mexican labor; and human rights groups, fearing the rights of the Hispanic laborers would be In Mexico, NAFTA has not lived up to any of its expectations. The salary that the workers accrued has remained the same, and in many cases has decreased, because of competitiveness. However, their average production has increased 36.4% since NAFTA’s implementation. In turn, since they are working more and earning less, these employees have experienced a definite decline of purchasing power. In 1997 alone, over 7.7 million Hispanic employees were being paid less than the legal minimum wage of $3.40..... A DAY!! Overall, the middle class of Mexico is disappearing. Since NAFTA’s birth, the country has been forced to watch as at least eight million would be middle class Hispanics were being cast out into poverty. These results can be directly attributed to NAFTA because, in the ten years before the plan, the poverty rate maintained a constant figure of 34%; yet from 1994 to 1997 the rate went to 60%, almost doubling in three years(*Watch, 1-93). The working conditions of these laborers have not improved either. These substandard facilities are often much more dangerous and uncomfortable than the label “sweatshop” implies. America has not fared much better than Mexico. Actually, I should say American people are not any better off.. The scales are tipped heavily by the stories of NAFTA victims, with not much recoil from success stories. In a study conducted by the Public Citizen’s Global Trade Watch, some 60 of 67 companies, who had specifically promised to produce jobs, had failed to meet their goal or even expand their business in Mexico. In fact, these companies had documented layoffs due to NAFTA. “According to the U.S. Department of Labor, approximately 214,902 American workers have been classified ....as being laid off due to NAFTA.” Furthermore, the Commerce Department canceled a survey program of U.S. companies to prove NAFTA’s job creation, because the results were so embarrassing--less than 1,500 jobs could be accounted for (*Watch, 1-93). There are many reasons for the loss of jobs. The most obvious and the most disgraceful is that of the big corporations moving their factories to Mexico. This is insulting to the American working class and an exploitation of the workers south of the border. Some may only argue this is capitalism, but whatever the argument, it is harmful for everyone but the company owner. A vast sector of the jobs being destroyed by NAFTA, are those in either automobiles or electronics; jobs that are consistently paying above average wages. Those who are not losing their jobs, are getting paid less for doing them. By threatening that their jobs will be moved to Mexico, workers are forced to accept lower wages and benefits to do the exact same work that they have always been doing. This also disables the unions and therefore gives the people absolutely no say so in the matters(Teamsters, 3). What choice do they really have when competing for their jobs, with those who will work for less in one entire day than the Americans will in an hour?? This accounts for the drop in morale of employees. Workers are not the only individuals who are hurt by the agreement. Small business owners are being run out of their venture, with the competition’s ability to reduce prices (by paying workers less or relocating). This cycle is only widening a gap between the upper and lower classes, making the rich, richer and the poor, poorer. Nonetheless, the people know exactly whom to blame for these troubles they are having. In recent opinion surveys, the results show that most Americans are mindful of “66% of Americans believe that free trade agreements....... “66% of Americans believe that NAFTA has helped only the 73% of Americans believe that NAFTA has directly hurt the small businesses of the United States. “58% of Americans agree that foreign trade has been bad for our economy and cheap imports have cost jobs and wages.” 81% of Americans say that Congress should not accept anymore trade agreements concerning consumer safety, labor, or the environment(Watch, 1-59). It appears that I am in agreement with the given American prospective, in that NAFTA’s disappointments are rampant. The information and statistics that are provided for us are astounding. Every set of data seems to pinpoint the same conclusion time and again, yet I cannot see as anything is being done to curb the damages. Those same ones who said that NAFTA would work are still claiming that it is working now, and those who opposed in the first place, are still opposing. It seems as though our NAFTA politics are at a standstill, while unemployment and the economy are not. But something must be done about this situation now, before it develops into a disaster for all parties concerned. I firmly believe that NAFTA has the potential to damage our nation’s economy, drastically increase our unemployment, and to stunt the pride and nationalism that is felt for our country. That is, of course, if it hasn’t done that already Bibliography: Bibliography Berner, Bernhard, Kutler. eds. “Firsthand America: A History of the United States”. 4th edition. Vol. 2. Chapter 29. Brandywine Press. St. James, New York. 1996 Creations, Spider Byte Web. “The North American Free Trade Agreement: An Overview.” Background. 1997. 7 paragraphs. Online. Internet Explorer. (25 May 1999). Online, FAS. “The North American Free Trade Agreement.” 2 June 1998. 4 paragraphs. Online. Internet Explorer. (25 May 1999). Teamsters, International Brotherhood of. “NAFTA: Fast Track to a Pink Slip.” Leaflets. 1996-1999. 3 paragraphs. Online. Internet Explorer. (25 May 1999). Watch, Public Citizen’s Global Trade. “NAFTA’s Broken Promises: Failure to Create U.S. Jobs.” Table: Job Promises and Reality. January 1997. 59 paragraphs. Online. Internet Explorer. (25 May 1999). *Watch, Public Citizen’s Global Trade. “NAFTA at Five Years Report Card.” 22 December 1998. 93 paragraphs. Online. Internet Explorer. (25 May 1999).

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