Immigration Flood Unleashed by NAFTA's Disastrous Impact on Mexican Economy
The recent ferment on immigration policy has been so narrow that it has excluded the real issue: family-sustaining wages for workers both north and south of the border. The role of the North American Free Trade Agreement and misnamed 'free trade' has been scarcely mentioned in the increasingly bitter debate over the fate of America's 11 to 12 million illegal aliens.
NAFTA was sold to the American public as the magic formula that would improve the American economy at the same time it would raise up the impoverished Mexican economy. The time has come to look at the failures of this type of trade agreement before we engage in more and lower the economic prospects of all workers affected.
While there has been some media coverage of NAFTA's ruinous impact on US industrial communities, there has been even less media attention paid to its catastrophic effects in Mexico:
- NAFTA, by permitting heavily-subsidized US corn and other agri-business products to compete with small Mexican farmers, has driven the Mexican farmer off the land due to low-priced imports of US corn and other agricultural products. Some 2 million Mexicans have been forced out of agriculture, and many of those that remain are living in desperate poverty. These people are among those that cross the border to feed their families. (Meanwhile, corn-based tortilla prices climbed by 50%. No wonder many so Mexican peasants have called NAFTA their 'death warrant.'
- NAFTA's service-sector rules allowed big firms like Wal-Mart to enter the Mexican market and, selling low-priced goods made by ultra-cheap labor in China, to displace locally-based shoe, toy, and candy firms. An estimated 28,000 small and medium-sized Mexican businesses have been eliminated.
- Wages along the Mexican border have actually been driven down by about 25% since NAFTA, reported a Carnegie Endowment study. An over-supply of workers, combined with the crushing of union organizing drives as government policy, has resulted in sweatshop pay running sweatshops along the border where wages typically run 60 cents to $1 an hour.
So rather than improving living standards, Mexican wages have actually fallen since NAFTA. The initial growth in the number of jobs has leveled off, with China's even more repressive labor system luring US firms to locate there instead.
But Mexicans must still contend with the results of the American-owned 'maquiladora' sweatshops: subsistence-level wages, pollution, congestion, horrible living conditions (cardboard shacks and open sewers), and a lack of resources (for streetlights and police) to deal with a wave of violence against vulnerable young women working in the factories. The survival (or less) level wages coupled with harsh working conditions have not been the great answer to Mexican poverty, while they have temporarily been the answer to Corporate America's demand for low wages.
With US firms unwilling to pay even minimal taxes, NAFTA has hardly produced the promised uplift in the lives of Mexicans. Ciudad Juarez Mayor Gustavo Elizondo, whose city is crammed with US-owned low-wage plants, expressed it plainly: "We have no way to provide water, sewage, and sanitation workers. Every year, we get poorer and poorer even though we create more and more wealth."
Falling industrial wages, peasants forced off the land, small businesses liquidated, growing poverty: these are direct consequences of NAFTA. This harsh suffering explains why so many desperate Mexicans -- lured to the border area in the false hope that they could find dignity in the US-owned maquiladoras -- are willing to risk their lives to cross the border to provide for their families. There were 2.5 million Mexican illegals in 1995; 8 million have crossed the border since then. In 2005, some 400 desperate Mexicans died trying to enter the US.
NAFTA failed to curb illegal immigration precisely because it was never designed as a genuine development program crafted to promote rising living standards, health care, environmental cleanup, and worker rights in Mexico. The wholesale surge of Mexicans across the border dramatically illustrates that NAFTA was no attempt at a broad uplift of living conditions and democracy in Mexico, but a formula for government-sanctioned corporate plunder benefiting elites on both sides of the border.
NAFTA essentially annexed Mexico as a low-wage industrial suburb of the US and opened Mexican markets to heavily-subsidized US agribusiness products, blowing away local producers. Capital could flow freely across the border to low-wage factories and Wal-mart-type retailers, but the same standard of free access would be denied to Mexican workers.
Meanwhile, with the planned Central American Free Trade Agreement with five Central American nations coming up, we can anticipate even greater pressure on our borders as agricultural workers are pushed off the land without positive, alternative employment opportunities. People from Guatemala and Honduras will soon learn that they can't compete for industrial jobs with the most oppressed people in say, China, by agreeing to lowering their wages even more. Further, impoverished Central American countries don't have the resources to deal with the pollution and crime that results from moving people from rural areas to the city, often without their families.
Thus far, we have been presented with a narrow range of options to cope with the tide of illegal immigrants living fearfully in the shadows of American life. Should they simply be walled off and criminalized, as Sensenbrenner and House Republicans suggest? The Sensenbrenner option seeks to exploit the sentiment that illegal immigrants entering the US -- rather than US corporations exiting the US for Mexico and China -- are the primary cause of falling wages for most Americans.
The Bush version is only slightly different, envisioning the "illegal immigrants" as part of a vast disposable pool of cheap labor with no meaningful rights on the job or even the right to vote, to be returned to Mexico upon the whim of their employers.
Yet there is another well-known path of economic and social integration that has been ignored in the debates over immigration in the US: the one followed by the European Union and their "social charter" calling for decent wages, health care, and extensive retraining in all nations. Before then-impoverished nations like Spain, Greece and Portugal were admitted, they received massive EU investments in roads, health care, clean water, and education. The implementation of democracy, including worker rights, was an equally vital pre-condition for entry into the EU.
The underlying concept: the entire reason for trade is to provide improved lives across borders, not to exploit the cheapest labor and weakest environmental rules. We need to question the widely-held assumption that what benefits American corporations benefits Mexican workers and American workers. An authentic plan for growth and development isn't about further enriching Wall Street, major corporations, and a handful of Mexican billionaires; it is about the creation of family-supporting jobs. It is also about a healthy environment, healthy workers, good education, and ordinary people being able to achieve their dreams.
The massive tide of illegal immigration from Mexico is merely one symptom of an economic arrangement where human needs -- not maximum profits-- are not the ultimate goal but a subject of neglect. Neither a massive, shameful barrier at the border nor a disposable guest-worker program will address the problems ignited by NAFTA.
Programs providing stable, decent employment, modern transportation, clean water, and environmental cleanup are needed to take the place of the immense NAFTA failure and allow Mexicans to live decent, hopeful lives in their native land. But such an effort is imaginable only if the aim is truly mutual uplift for all citizens in both nations, instead of the NAFTA-fueled race to the bottom.