The Disastrous Effects Of
NAFTA on Mexico’s
On December 8th of 1993, The North American Free Trade Agreement (NAFTA) was signed into law by the President of the United States, William Jefferson Clinton. It, too, would be a day remembered in infamy, to borrow from Franklin Delano Roosevelt’s famous statement at the beginning of WWII, describing the bombing of Pearl Harbor, Hawaii, on December 7th, 1941. The signing of NAFTA into law started Mexico’s inevitable economic decline, beginning with the devaluation of the Mexican currency (the peso) in 1994 and 1995.
This occurrence combined with the influx of higher quality goods flooding the Mexican marketplace from the United States and Canada with decreased import tariffs sounded a death knoll to Mexico’s manufacturers of the same products. They were not alone in Mexico’s declin-ing economy. The American owned factories placed strategically along the border between the U.S. and Mexico, which produced goods destined for the United States and Canada began to lose jobs to the lesser expensive manufacturing schemes of China. This occurrence threw more of Mexico’s population, especially among the already poor, into a tailspin. Families starving and with no new prospects for jobs drove these displaced workers for the border of the two countries and northward into the United States and Canada.
But factory workers were not the only ones hurt by this so-called free trade agreement. Small rural farms were also put out of business as the United States stepped up its exports of grains including the staple food of the Mexican populace, corn. Corn poured into the country, selling at lower prices than a small time farmer, without the benefit of new agricultural and mechanized technology to help him, could compete with. Eventually, these rural folk were forced to sell off their small farms, and immigrate also to the United States for work.
In Mexico, there were no farm subsidies provided by the government to help farmers out, unlike the subsidies paid to U.S. farmers. In the U.S. these experienced agricultural workers crossed the border illegally many times to work for the large produce, livestock, and fruit pro-ducers that needed people to harvest at low wages. This enabled U.S. producers to make a con-siderable profit. Mexico’s red-meat producers, especially the hog farmers, were also forced out of business, because the U.S. was exporting meat to Mexico at lower prices than the average Mexican hog farmer could afford to sell his hogs for at market.
Even though NAFTA infused Mexico with tremendous amounts of financial capital to educate, develop the infrastructure of Mexico, training their people for new high-tech jobs and new ecologically sound practices of agriculture, due to the corruptive forces within the hierarchy of the Mexican government, little was achieved. Much of the funding went to political cronies, personal and family friends within the governmental structure itself. The development of the country of Mexico by its own government was not the highest priority on the docket, making the rich richer was its number one priority.
Of the people Mexico did train in high tech jobs in Mexico’s universities, many left the country to work in the United States and Canada. This created an academic drain upon the Mexi-can government, and availed Mexico little in return for the expenditure. These individuals, too, crossed the border into the United States in search for the higher wages, which the U.S. would pay them for their knowledge.
Of the rural populace, some of the children received an education, but not all. The indig-enous peoples of Mexico were deprived of even a rudimentary education, not considered to be Mexican, because no Spanish blood flowed through their veins. An adequate education would have allowed them the opportunities to lift themselves out of poverty, and make something of their lives. Instead, they, too, immigrated to the United States to work for the higher wages paid there. The health and welfare of the Mexican people was not a concern. Improvement of the in-frastructure in many states was almost nonexistent. Moneys meant to go for special programs to assist the poor were not disclosed to the general population, but only to those who knew of someone in the government who knew about these programs, and could help them out financially to build up small businesses to improve their lot in life. NAFTA attributed to this injustice also, by not ensuring that the Mexican government carried out all of these invaluable programs meant to lift Mexico out of third world status, ultimately meant to target Mexico for great progress, and even greater prosperity. However, the common Mexican worker grew poorer by the day, and fi-nally immigrated to the United States, either legally or illegally in search of work.
But in the meanwhile it availed U.S. and Canadian interests to thrive and achieve tremen-dous profits. Mexico’s failure would haunt the Mexican populace, while the U.S. and Canada reaped huge profits from the formation of NAFTA. NAFTA not only attributed to Mexico’s downfall, but is today engaging in other free trade agreement with governments in Central Amer-ica (CAFTA), and even governments in parts of South America. What lessons are to be learned from NAFTA’s greed and lack of concern for the Mexican people? As the profits roll in, so do the people driven out of a livelihood in their own countries, looking for what you took from them at home.