After 20 Years, NAFTA Leaves Mexico’s Economy in Ruins

New Post Public Reply Private Reply Replies (0) Message Board
SaltyMutt
After 20 Years, NAFTA Leaves Mexico’s Economy in Ruins

By Sonali Kolhatkar
Posted on Jan 9, 2014


AP/Ivan Pierre Aguirre

Post-NAFTA Mexico, 20 years later: American companies such as Applebee’s, Burger King and Smartmart line the street in Ciudad Juarez in December.


Twenty years ago, on Jan. 1, 1994, a trade deal championed by Democratic President Bill Clinton went into effect. The North American Free Trade Agreement was meant to integrate the economies of the United States, Canada and Mexico by breaking down trade barriers among them, creating jobs and closing the wage gap between the U.S. and Mexico.

What in fact happened under NAFTA was that heavily subsidized U.S. corn flooded the Mexican market, putting millions of farmers out of work. Multinational corporations opened up factories creating low-wage jobs at the expense of organized labor and the environment. This, in turn, drove waves of migration north.

Meanwhile, corporate profits soared, and Mexico boasted the richest man in the world, Carlos Slim. Walmart and Krispy Kreme conquered Mexico, and ordinary Mexicans had access to the same consumer goods as their neighbors to the north. The economies of all three nations, measured only by GDP rather than jobs or wages, were pronounced grand successes, even though the U.S. and Canada disproportionately reaped ( http://tinyurl.com/nrd9ftw ) more financial benefits.

Meanwhile, in the U.S., manufacturing jobs fell dramatically and organized labor lost even more clout. The Great Recession of 2008 worsened the downward trend, especially for Mexicans. Mexico’s economy, tied intimately to the U.S.’ because of NAFTA, suffered more than any other country in Latin America.

News reports on NAFTA’s anniversary point out that as a result of the free trade agreement, Mexicans today can buy designer sneakers or iPhones. Manuel Perez-Rocha, an associate fellow at the Institute for Policy Studies in Washington, D.C., and a Mexican national, told me in an interview, “This is a new spin—praising the riches of consumerism. All these new analyses about how Mexico is becoming a more middle-class society and able to buy more products from the United States—it’s just baloney. According to official statistics from Mexico, most Mexicans are poor and belong to the lower class, and this is the reason why there has been so much migration to the United States.”

Coinciding with NAFTA was one of the biggest waves of migration from Mexico to the U.S., which slowed only in recent years. Perez-Rocha asserted that, “The fact is that most Mexicans are jobless, or have very difficult job conditions, or are underemployed, and so the push for migration continues. Most of the routes by which people would migrate from Central America and Mexico to the United States have been severed by violence, and by the ‘narcos’ [drug lords], sometimes with the complicity of the Mexican migration authorities

Even analysts who tout the economic benefits of NAFTA to all three member countries acknowledge that Mexico has benefited less than its neighbors to the north. Perez-Rocha confirmed that, saying, “During NAFTA, Mexico has had the slowest rate of economic growth than [with] any other previous economic strategy since the 1930s. From 1994 to 2013, Mexico’s gross domestic product per capita has grown at a paltry rate of 0.89 percent per year.” Additionally, “During NAFTA, Mexico’s economy grew much slower than almost every Latin American country. So to say that NAFTA has benefited the Mexican economy is also a myth. It has boosted trade and investment , but this has not translated into meaningful growth that generates jobs. One of the problems that NAFTA has generated is basically an exporting economy for transnational corporations, not for the Mexican industry per se.”

It turns out that not only did NAFTA, “flood Mexico with imported corn and cheap grains from the United States,” but “it also destroyed Mexico’s own industries,” according to Perez-Rocha.

Having grown up in Mexico, the analyst reminisced, “Before NAFTA, I still remember how my father would take me to different industries in which Mexico would manufacture its own tractors and buses. We had an industry that was completely dismantled to give way to bigger corporations from the United States to use Mexico as an assembly plant for exporting cars back to the United States. And this hasn’t produced the boom of jobs that was promised.” Perez-Rocha concluded, “So in the end what NAFTA did was destroy the Mexican national industry and destroy a lot of jobs.”

One of the promises of NAFTA was that it would reduce the wage gap between American and Mexican workers. In fact, Mexicans earn less than they did in 1994 ( http://tinyurl.com/bthbecw ) when NAFTA was first enacted. Perez-Rocha concurred, saying, “This was one of the unfulfilled promises [of NAFTA]. The wage gap between the United States workers and Mexicans remained basically the same. And it is very notorious today that proponents of NAFTA are even saying that Mexico is a very attractive country for foreign investment and they cite precisely the low cost of labor.” Nearly half of the Mexican population currently lives below the poverty line.

NAFTA went into effect on the same day that the Zapatista National Liberation Army in Chiapas, Mexico, made itself public. The Zapatistas, with incredible foresight, called NAFTA a “death sentence.” According to Perez-Rocha, the Zapatistas “knew what is evident today—that the countryside of Mexico was going to be devastated. ... What we’ve seen in 20 years—and I’m very certain that the Zapatistas foresaw this—was the devastation of the Mexican countryside and of the livelihoods of farmers to give way to a narco-economy that has inundated Mexico. This has become very evident in the past few years.”

A protest on Jan. 1, 2014, on the border between Ciudad Juarez and El Paso, Texas, marked the 20th anniversary of the start of the Zapatista Uprising and of the launch of NAFTA. Perez-Rocha, who closely followed the action, cited photos in social media of activists carrying signs that read, “NAFTA has meant less farmers and more Narcos in the countryside.”

Not only has NAFTA negatively affected Mexico’s economy, jobs and wages, it has also devastated the air, water and land. Perez-Rocha has been researching the environmental impact of NAFTA and found that “there has been an increase in export-oriented agriculture that relies on fossil fuels, chemicals, genetically modified organisms, and the excessive use of water. There has also been an expansion of environmentally destructive mining activities in Mexico. There’s been more mining in the last 10 years than in the whole colonial period. There have been higher levels of air and water pollution as associated with the growth of the maquiladora factories. And there has been a progressive weakening of domestic environmental safeguards and expanded powers to corporations to challenge environmental policies.”

Today, the Obama administration, which did not even acknowledge the 20th anniversary of NAFTA, is eyeing a new, grander trade deal in the image of NAFTA called the Trans-Pacific Partnership.

The TPP is a secret deal being negotiated by the Obama administration directly with various nations. Activists have called it “NAFTA on Steroids.” Obama is seeking “fast-track authority” on the deal, whereby elected representatives would be allowed to vote on only the entire agreement without being party to negotiations over the details. WikiLeaks recently published a leaked draft chapter of the agreement that has confirmed some of the worst suspicions of activists opposing it ( tinyurl.com/n8mcexl ). One expert called it “A Christmas wish list for major corporations.”

If the implementation of NAFTA is any indication of how poor countries like Mexico have suffered under free-trade deals, Congress ought to fight the adoption of the TPP tooth and nail. The trouble is, as Perez-Rocha acknowledges, “Unfortunately I think that most Mexicans — and I would say the same here in the United States and Canada—don’t have a very clear understanding of how NAFTA itself has affected their lives and the economy of our countries.”
(highlighted for emphasis)

http://www.truthdig.com/report/item/after_20_...0140109?ln
Scroll down for more posts ▼

Top 10 Most Recent News Articles

November Oil Outlook: OPEC+ Steady, Key Earnings Ahead

Updated Category News Views 57

Oil's November Gambit: OPEC+ and U.S. Dynamics November's here, and boy, it's shaping up to be a wild one for the oil market. OPEC+ decided to stick with their oil production targets for December, leaving the supply faucets unchanged. This group, including big players like Saudi Arabia and Russia, met virtually and chose to hit the brakes on any changes just yet. With the...

Continue Reading
Spago Shanghai Celebrates a Year of Culinary Excellence

Updated Category News Views 108

The Landmark Year in Fine Dining Spago Shanghai just blew out its first candle, folks, and what a year it's been. From its lofty perch in The St. Regis on the Bund, this hub of culinary magic has carved out a name with accolades aplenty, a hard feat among the many fine-dining heavyweights dotting the Shanghai skyline. A Transplant of California Flavors You take a seat...

Continue Reading
Home Ownership in MS: Beyond Just a Mortgage

Updated Category News Views 56

Navigating the Real Costs of Homeownership in Mississippi The sunny dreams of first-time homebuyers in Mississippi often get clouded by the storm that is unforeseen expenses. You sign on the dotted line and suddenly discover that a cozy home comes with more financial baggage than just a mortgage. Steve Houck, the go-to real estate guru in Ridgeland, MS, delivers a wise...

Continue Reading
Wet Noses Innovates Human-Grade Pet Food at PLMA 2026

Updated Category News Views 83

Pet Food Revolution? Wet Noses Takes the PLMA Stage Okay, listen up, pet lovers and industry folks alike—seems like Wet Noses, that Washington-based veteran in the dog treat game, is shaking up the pet food world. After cruising through the pet aisle for almost three decades, they're making a splash at the PLMA 2026. Why should we care? Well, they’re pushing this...

Continue Reading
Tips to Pick the Right Primary Care Provider

Updated Category News Views 76

Deciding on Your Healthcare Anchor The quest for the perfect primary care provider isn't just routine; it's a cornerstone to your overall healthcare strategy. When Healthcare Services Expert Sheila A. Berschauer from Moses Lake Community Health lays it all out in HelloNation, she pinpoints selecting a provider as one of the mightiest decisions in your health journey. This...

Continue Reading
IntelliGenome Partners with NL Diagnóstica for TB Battle

Updated Category News Views 127

Breaking New Ground in Tuberculosis Detection When IntelliGenome, a Houston-based developer of CRISPR-based diagnostic tech, teams up with São Paulo's veteran player NL Diagnóstica, you know they're onto something game-changing. This partnership is all about taking the fight against tuberculosis in Brazil to new heights with their CRISPR-Dx™ diagnostic platform. Not...

Continue Reading
Wolfbox Unveils High-Octane Gear at SEMA 2026

Updated Category News Views 88

Revving Up with Wolfbox's New Offerings There's an electrifying hum in the air, buzz-fueled by Wolfbox's latest gear debut at the SEMA Show 2026 in Las Vegas. The booth is a treasure trove for anyone keen on amping up their vehicle tech, with Wolfbox laying bare everything from dazzling dash cams to adaptive trail lights. It's the kind of smorgasbord that'd make a...

Continue Reading
Industrial Automation Booms: Market to Hit $410B by 2031

Updated Category News Views 101

Industrial Automation Surge: A New Era Dawns There's no denying it, folks: the gears are turning at a breakneck pace in the industrial automation world. We've got our eyes set on a staggering climb from $266.7 billion in 2026 to a jaw-dropping $410.3 billion by 2031. That's a 9% annual growth rate that's got investors salivating. Robotics and AI: Leading the Charge Look...

Continue Reading
Tactical Comm Market: $19.39B by 2031 Amid 8.1% CAGR

Updated Category News Views 115

Riding the Tactical Communication Wave Alright, here’s something to chew on over your morning coffee. The tactical communication market is projected to balloon from USD 13.14 billion in 2026 to a whopping USD 19.39 billion by 2031. That’s an 8.1% CAGR if you’re keeping track—no small peanuts. So what's driving this surge? It’s all about security, modernization,...

Continue Reading
Endava Facing Securities Fraud Suit; Stocks Down 24%

Updated Category News Views 54

Endava Hits Rough Patch with Legal Battle Brewing So here we are, watching Endava plc struggle through legal quagmires and tumbling stock prices. Come September 21, 2026, news hit the street: Endava's CFO, Mark Thurston, found himself on administrative leave due to an investigation surrounding some shaky accounting practices. The Audit Committee raised a red flag, and...

Continue Reading

Top 5 Most Recently Viewed Articles

Fluence Energy Sets Earnings Call for Q3 2025 Review

Updated Category News Views 235

Fluence Energy Announces Third Quarter Earnings Release ARLINGTON, Va. — Fluence Energy, Inc. (Nasdaq: FLNC) has shared that it will release its earnings report for the third quarter, covering the period that ended on June 30, 2025. The earnings announcement is scheduled to take place after the market closes on August 11, 2025. Details of the Teleconference Following...

Continue Reading
Shane Westra Takes Charge as Cardata's New CPTO

Updated Category News Views 237

Shane Westra Takes Charge as Cardata's CPTO Cardata, the fully-managed vehicle reimbursement partner, has made a significant move by appointing Shane Westra as its Chief Product and Technology Officer (CPTO). With an impressive career spanning over 25 years, encompassing roles in Salt Lake City and San Francisco, Shane is set to bring a tailored approach to Cardata....

Continue Reading
Interparfums Welcomes New Board Members and Meeting Highlights

Updated Category News Views 214

Interparfums Announces Annual Meeting Outcomes Interparfums, Inc. (NASDAQ: IPAR) proudly shared the results from its recent Annual Meeting of Shareholders. This event showcased the company’s growth and strategic direction as it welcomed two new members to its Board of Directors. Election of Directors During the meeting, shareholders unanimously approved all proposals...

Continue Reading
Flex LNG Announces Key Details for Upcoming Cash Distribution

Updated Category News Views 271

Flex LNG Cash Distribution Information for Q3 2024 Flex LNG Ltd. is preparing for an important cash distribution for the third quarter of 2024. This dividend will be drawn from the Contributed Surplus Account of the company. Shareholders should be aware of the specific details as they prepare for this payment. Settlement Cycle Adjustments Impacting Shareholders From the...

Continue Reading
Exploring the Benefits of Gundry MD MCT Wellness Supplement

Updated Category News Views 407

What is Gundry MD MCT Wellness? Gundry MD MCT Wellness is an exceptional dietary supplement crafted to support the body's production of ketones, aiming to enhance energy and promote fat-burning. Developed by the acclaimed heart surgeon and nutrition expert Dr. Steven Gundry, this product stands out due to its unique blend of C8 MCT powder and powerful polyphenols, all...

Continue Reading