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News :: Globalization |
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Free Trade Ain't So Free |
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by Sascha Bollag
(No verified email address) |
13 Nov 2003
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NAFTA does not only have adverse effects on Mexicans. It has also caused tremendous job loss on our side of the border. The "giant sucking sound" that Ross Perot predicted did in fact come true. According to the Economic Policy Institute, the U.S. manufacturing sector lost 544,750 jobs between 1993 and 2000 as companies moved to Mexico to take advantage of weaker labor standards and lower wages. |
In less than a week trade ministers from every country in the Western Hemisphere, except Cuba, will be meeting behind closed doors in Miami to negotiate the Free Trade Area of the Americas (FTAA).
If the countries that fall under the North American Free Trade Agreement (NAFTA) – Canada, Mexico, and the United States – are any indicators of what free trade agreements really accomplish, then the rest of the hemisphere is in for a rough ride. Using NAFTA as the standard, implementation of the proposed FTAA will be a disaster.
Nearly ten years after NAFTA took effect in 1994 lower-income Mexicans have seen only further impoverishment as their reward. Increased US imports have devastated the Mexican economy: wages have decreased sixteen percent, eight million families have been forced out of the middle class and into poverty, and 28,000 small businesses have shut down as a result of the entrance of foreign companies. The environmental and public health impact on Mexico has also been disastrous.
NAFTA has clearly demonstrated in Mexico that the benefits of free trade extend only to a small number of economic elites. While small farmers on both sides of the border have received minimal government support, large multinational agribusinesses have benefited from generous subsidies. Mexico’s rural poverty has increased, unemployment is up sharply, immigration is skyrocketing, environmental damage has increased, and communal land rights are in jeopardy. Rather than reducing poverty, NAFTA has increased the gap between the rich and poor.
NAFTA does not only have adverse effects on Mexicans. It has also caused tremendous job loss on our side of the border. The “giant sucking sound” that Ross Perot predicted did in fact come true. According to the Economic Policy Institute, the U.S. manufacturing sector lost 544,750 jobs between 1993 and 2000 as companies moved to Mexico to take advantage of weaker labor standards and lower wages.
This past summer I traveled to Nicaragua as part of a Witness for Peace delegation. Witness for Peace is a non-partisan peace and justice organization that works to change U.S. policies that disadvantage the people of Latin America and the Caribbean. One of the major issues that we learned about and discussed with Nicaraguans was the proposed FTAA, and how devastating it will be for them if it is implemented.
We listened to Danilo Gurdian, a member of the Nicaraguan Consumer’s Defense Network, describe how if the FTAA is implemented Nicaraguans will not be able to say no to transnational companies that wish to exploit its natural resources, even in contradiction of national protection laws. A provision similar to Chapter 11 of NAFTA, which will no doubt be a part of the FTAA, would allow transnational companies to sue villages, towns, and even countries for impeding their right to make a profit.
We heard from Dońa Gladys Hernandez, a woman who used to work in a maquila – foreign-owned textile factories – about the terrible working conditions that the young women, who comprise 90% of the maquila workforce, face. These workers make the equivalent of about twenty cents per hour, and work under conditions of extreme pressure, constantly having to meet ever-rising quotas. Many of these companies are owned by Americans, lured there as a result of tax breaks and dirt-cheap wages. If the FTAA as it is currently being negotiated is implemented, without any provisions whatsoever for protection of labor and worker’s rights, it will make it easier for companies to pack up shop and move south.
But the most striking appeals against the FTAA that we heard came from small farmers in a tiny town called El Regadillo, in the mountains of Nicaragua. These small agricultural farmers, who produce products such as corn and grain, make up the bulk of Nicaragua’s population. They are terrified that the removal of trade barriers that will accompany the FTAA will cause their markets to be flooded with cheap, subsidized U.S. agricultural products. This would totally destroy these farmers and their way of life. As Don Agosto Obregon, a community leader, told us, “As a small farmer and campesino, I am against any kind of free trade agreement.”
If we wish to create a world in which fair economic relations exist between all peoples of the world, our only choice is to say NO to the FTAA. Please write and call your Representative and Senators and ask them to vote NO when the FTAA comes up for a vote.
Sascha Bollag is a sophomore history major at the University of North Carolina - Chapel Hill. |
