Twenty Years of NAFTA: Capital freely crosses borders while people can’t

by on January 7, 2014 · 3 comments

in California, Civil Rights, Economy, World News

By Anna Daniels / San Diego Free Press

In 1993, the North American Free Trade Agreement (NAFTA) was sold to the American public with grand promises. NAFTA would create tens of thousands of good jobs here. U.S. farmers would export their way to wealth. NAFTA would bring Mexico’s standard of living up, providing new economic opportunities there that would reduce immigration to the United States.Public Citizen NAFTA’s Broken Promises 1994-2013

NAFTA-20-Years-Later-1-Million-Jobs_issuebannerOn January 1, 1994, a trilateral free trade zone was established in North America. This treaty with the United States, Mexico and Canada resulted in the mass relocation of factories and capital south of the Mexican border. Then President Bill Clinton asserted that NAFTA was going to “promote more growth, more equality and better preservation of the environment and a greater possibility of world peace.”

The lived experience on both sides of the US-Mexican border has fallen far short of Clinton’s encomiums. Whole cities and towns were hollowed out when over 700,000 US jobs, many of them decent paying manufacturing jobs, were re-constituted in maquiladoras south of the border where wages were lower and regulations were laxer. In Mexico, NAFTA agribusinesses raising corn for ethanol displaced farmers raising corn to feed the people, creating a food crisis that further immiserated the poor there.

nafta in mexicoWhat NAFTA did do was grease the corporate skids for WalMart and the Walmarting of the labor force in both countries. NAFTA has been very good for foreign investors. It has resulted in growing inequality and wage stagnation for the poor and struggling middle class in both the US and Mexico as well as environmental degradation.

While the United States is currently negotiating a Trans-Pacific Partnership (TPP)that lacks transparency and provides enormous corporate giveaways and protections, fifty-three percent of Americans now believe the United States should “do whatever is necessary” to “renegotiate” or “leave” NAFTA. Yet once again citizens are being hoodwinked into believing that an awesome number of jobs will be created and the standard of living will rise, all without adverse environmental impacts by the TPP.

Citizens should resist being duped again into thinking they are going to be winners with the TPP, which is referred to as NAFTA on steroids.

After nineteen years of NAFTA, we can measure its actual outcomes. The grand promises made by proponents remain unfulfilled. Many outcomes are exactly the opposite of what was promised. Many U.S. firms used the new investor protections to relocate production to Mexico to take advantage of its low wages and weak environmental standards and to attack NAFTA countries’ environmental and health laws in foreign tribunals. Over $340 million in compensation to investors has been extracted from NAFTA governments via these “investor-state” challenges. Public Citizen

A few days ago, a group of artists planted twenty flags at Border Field State Park, “A Future Memorial for NAFTA” as a poetic resistance to extraction capitalism.

A Future Memorial for NAFTA

During the presidential primary in 2008, then Senators Barack Obama and Hillary Clinton critiqued NAFTA in one of their debates. Neither seriously considered pulling the US out of the treaty, but both called for renegotiating the treaty in order to provide relief to American workers. There has clearly been no renegotiation, even though NAFTA exists as an executive order which gives discretion to the executive branch, including over turning Bill Cinton’s previous executive order. President Obama is moving ahead on the TPP instead.

Noam Chomsky describes the danger of these types of trade agreements–“[They] override the rights of workers, consumers, and the future generations who cannot “vote” in the market on environmental issues. They help keep the public “in its place.” These are not necessary features of such agreements, but they are natural consequences of the great successes of the past years in reducing democracy to empty forms…”

NAFTA is twenty years old and the reduction of democracy to empty forms continues.



{ 3 comments… read them below or add one }

obracer January 7, 2014 at 7:18 pm

Author is ignorant of the facts, no truth here.


George Above the Cliffs January 8, 2014 at 8:05 pm

Globalism is just a euphemism for the elites to exploit people everywhere. Treaties are the tools and if you ever bother to read the massive text of the NAFTA treaty you will see that it was written by Wall Street interests. From what I have read of the TPP it is a foul document written by the same Wall Street interests taking power and rights from the people and handing it o the global elites. Resist Wall Street and big government.


John January 15, 2014 at 8:18 am

I didn’t see this touched upon, but IMO (and many economists) the failure of NAFTA from a standpoint of US jobs and our fortunes here was the transfer of intellectual properties and not just to Mexico but onwards to China. The knowledge to manufacture an infinite number of products we used to do here. Know how, processes, techniques, that in decades past was called “industrial espionage” if you quit one company and took it to another.
No, as stockholders shuttered American factories they sent their engineers overseas to ensure the cheaper goods they solicited bids to produce would meet quality standards their brands had established. In some cases they brought samples home, destroyed them, and sent them out to professional materials analysis labs to ascertain what exactly was inferior and instructed the Chinese suppliers how to alter the compounds or alloys to get it right. This process would normally be very costly to the manufacturer and be done through trial and failure in the market place.
I know someone who worked for Darryl Issa’s former auto aftermarket parts company who had this job and he travelled to China regularly. Darryl Issa raided American car audio manufacturers, shuttered their factories and then milked their brand names selling cheaply badged inferior imported goods. This helped fund his purchase of a Congressional seat. I do understand Issa was a fair guy to work for and I don’t fault this guy who headed the engineering of their audio lines. He’s also a good guy and was just doing his job.
Note this is also what got Loral Space Systems and the Clinton administration in hot water over Bernard Schwartz’ campaign contributions and Clinton’s actions over the Chinese Long March missile failure analysis. Campaign contributions- a half million dollars- went into the DNC coffers at the same time Clinton made inexplicable excuses for Loral assistance in correcting faulty inertial guidance systems in Chinese satellite launchers- as well as their ICBM’s. Portrayed in the worst way, Clinton and the DNC got paid to look the other way while technology improvements were handed to the Chinese military who used it to improve the accuracy of ICBMS loaded with nuclear weapons pointed at us today.
And Darryl Issa raided US companies and handed the technology to Chinese manufacturers- up to a thousand US jobs lost just for him to buy a Congress seat.
Is that bipartisan enough? I stand by all the facts claimed above and now the really inflammatory part:
During those years I bought a playstation, and a PS2, recently a PS3, and if I wanted just about any consumer product, I wanted it cheap, dammit.

And so did every one of you.

While all this is going on China is an authoritarian socialist (trending ever capitalist) cesspool and not wasting time and energy on partisan politics.

Draw your own conclusions but one should be obvious: pointing fingers in a political arena is not only counterproductive it reveals those engaged in it likely don’t have a clue about how we got here nor how (if we even could) get out of it.


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