That Giant Sucking Sound

Ten years after, do we still need NAFTA?

by David Bacon

This week thousands of demonstrators will fill Miami streets in a show of opposition to free trade unseen (at least in this country) since the battles in Seattle four years ago. Opponents plan to hit the proposal for a Free Trade Area of the Americas (FTAA) with the same one-two punch that forced trade ministers to end talks in Cancun in October with no new agreement. While a sea of grassroots opponents lay siege in the streets to the Miami hall where ministers meet once again, inside the meeting itself the new left-wing governments of Latin America -- Brazil, Ecuador, Argentina and Venezuela -- have already formed an implacable opposition.

As demonstration and debate unfold, in the eye of the storm is the one free trade agreement that already provides an idea of what the Americas can expect from the Bush free trade plan. In just a few short weeks, the North American Free Trade Agreement (NAFTA) will be 10 years old. And for FTAA’s opponents, that 10-year history of devastation, wreaked in Mexico and the U.S. both, will be the key argument in stopping its extension to the rest of Latin America.

The communities of working people and the poor on both sides of the border have paid the price for trade liberalization, while the benefits have been reaped by the tiny clique who promoted NAFTA 10 years ago.

In one of life’s ironies, successive secretaries of the U.S. Department of Labor -- among NAFTA’s most ardent supporters -- have kept close track of the treaty’s high cost in U.S. jobs. By 2002, the department had certified that 408,000 workers qualified for extensions of unemployment benefits because their employers had moved their jobs south of the border.

Most observers believe this is a vast undercount. According to NAFTA at Seven, a report by the Economic Policy Institute, "NAFTA eliminated 766,030 actual and potential U.S. jobs between 1994 and 2000 because of the rapid growth in the net U.S. export deficit with Mexico and Canada."

While the job picture for U.S. workers was grim, NAFTA’s impact on Mexican jobs was devastating. Before leaving office (and Mexico itself, pursued by charges of corruption), President Carlos Salinas de Gortari promised Mexicans they would gain the jobs the U.S. lost. And on tours to the U. promote the treaty, he promised that this job gain, although painful for U.S. workers, would halt the northward flow of Mexican job seekers.

NAFTA’s first year saw instead the loss of more than a million jobs all across Mexico in the wake of economic crisis. To attract investment, NAFTA-related reforms required the privatization of factories, railroads, airlines and other large enterprises. This led to further huge waves of layoffs. And because unemployment and economic desperation in Mexico increased, immigration to the U.S. has been the only hope for survival for millions of Mexicans.

The most serious consequence of NAFTA has been its failure to protect the rights of workers as promised by its supporters. To attract investment to the maquiladoras (foreign-owned assembly plants), Mexican government authorities cooperated with investors and compliant official unions in maintaining a low-wage economy, reinforced with a system of labor control.

A study by the Center for Reflection, Education and Action, a religious research group, found that at the minimum wage, it took a maquiladora worker in Juarez almost an hour to earn enough money to buy a kilo (2.2 pounds) of rice; for a worker in Tijuana, it cost an hour and a half. And yet another study by the economics faculty of the National Autonomous University in Mexico City says Mexican wages have lost 81 percent of their buying power in the last two decades.

Ten years of hearings held under NAFTA’s labor side agreement have documented extensive violations of labor rights. In those few instances in which workers have successfully formed independent unions, as they did at Tijuana’s Han Young plant in 1998 and 1999, their strikes were broken, despite guarantees under Mexico’s constitution and federal labor law.

Four years ago, at the height of the protests against the World Trade Organization, Zwelenzima Vavi, the head of the Congress of South African Trade Unions, described the alternative to NAFTA and the free trade philosophy underpinning it. "In the pursuit of profit," he said, "governments are told to remove worker protections, and then use that as an inducement for investment. But development is a wider concept. It includes social development, and the living conditions of the people. Development can’t exist with mass unemployment and poverty."

As the opposition gathers in Miami, these are the words that critics of NAFTA and FTAA will put before the world.

David Bacon is a California writer and photographer whose book, The Children of NAFTA, was just released by the University of California Press. If you would like to respond to this Slant or have one of your own (850 words), contact Howard Altman, City Paper editor in chief, 123 Chestnut St., third floor, Phila., PA 19106 or e-mail altman@citypaper.net.