Mega-NAFTA?

If an enemy was seeking to hire someone to destroy America he might have hired the political leaders who created WTO, NAFTA, CAFTA (and now in the works FTAA).

In 1994 there was NAFTA; an agreement that set out to reduce trade barriers and promote “free trade” between Mexico, Canada, and the United States (which turned out to be a disaster for Mexico and the U.S.) Ross Perot's comments "a giant sucking sound" turned out to be true.

In 2005 the US ratified CAFTA. Similar to NAFTA, this agreement attempted to eliminate trade barriers and widen the trade community. CAFTA included the Central American countries of Costa Rica, El Salvador Guatemala, Honduras, Nicaragua and later the Dominican Republic.

Currently there is an agreement in negotiations that could drastically change the future of American trade; the Free Trade Area of the Americas (FTAA). If ratified this agreement will be the new “NAFTA” to almost the entire Western Hemisphere.

At the last FTAA negotiations in 2003, 34 nations of the America’s met to discuss terms; few countries were excluded (Castro’s Cuba, and Chavez’s Venezuela being some of the notable admissions).

But what would a hemisphere-wide NAFTA mean to the US?

To understand the effects of this newly proposed mega-NAFTA, we should focus on what has happened under the original NAFTA. According to the Economic Policy Institute, NAFTA has increased trade deficit between Mexico and Canada and crippled US jobs. Since NAFTA’s inception the trade deficit has exported US manufacturing capabilities that supported 1,015,291 American jobs and lost billions of dollars in wage payments.

Ralph Nader’s non-partisan watchdog group Public Citizen reports that workers unions have also suffered from NAFTA. NAFTA has allowed corporations more leverage to move, and threaten to move, their companies to less-regulated production facilities abroad. According to a Cornel study cited by the group, 18% of companies that threatened to close their plants also threatened to move abroad (usually to Mexico) if the union succeeded in securing the wages they desired. The result of this new NAFTA-leverage has been an especially sharp decrease in unionization, most notably the manufacturing industry which dipped 47% from 1983-2000, leading to stagnant blue-color wage growth.

The truth is NAFTA has exploited America, increasing the trade deficit, exporting manufacturing jobs to the lowest bidder and helping to support stagnant blue-collar wages.

The FTAA, a new mega-NAFTA, is not what the United States or its workers need.

Economy In Crisis relies on financial support from its readers. Your endorsement is greatly appreciated. Click here for other ways to get involved.