January 2017 – During his recent campaign, Donald Trump suggested that if he were elected, he would get rid of the North American Free Trade Agreement (NAFTA), at one point calling it “the worst trade deal maybe ever signed anywhere.” I agree with him.
I believed at the time that Congressional approval would be needed to undo NAFTA. This appears to be wrong. NAFTA was written in a way that the President himself by executive order can undo over 90 percent of the NAFTA agreement with his signature.
American workers should lobby President Trump to follow through on that stand and repeal NAFTA right away. Trump is correct to assert that NAFTA has motivated American manufacturers to relocate to poorer countries such as Mexico, where wages are far lower and worker protection and environmental regulations are much weaker.
In fact, a 2014 study by the non-profit consumer advocacy organization Public Citizen concluded that none of the economic benefits promised by NAFTA backers when it was enacted in 1994 came to fruition. “Instead, millions have suffered job loss, wage stagnation, and economic instability from NAFTA,” the study found.
It also turns out, according to a report in the New York Times on January 5 of this year, that NAFTA hasn’t done anything to uplift working people in Mexico, where workers continue to languish in misery and poverty, even as their corporate employers enjoy massive profits.
The report examines the plight of Jose Luis Rico, a long term employee at a Whirlpool refrigerator factory in the town of Apodaca, Mexico, who earns “well under $10,000 a year,” and can’t see any way in which NAFTA has enhanced his life.
“It’s more like survival,” Mr. Rico is quoted. “I thought it would make my life better, that this agreement would create opportunities for everyone.” Then, nodding toward the Whirlpool logo at the factory entrance, he added, “Maybe it has. Just not for us.”
The article also points out that since NAFTA’s enactment, Mexico’s economic growth has stagnated, and that more than half of the country’s workers still live below the poverty level, a rate unchanged since before NAFTA went into effect. Even in the new manufacturing hubs created by NAFTA, “wages and hopes have frozen,” the report adds.
For 10 years, the Times reports, Jorge Augustín Martínez has driven a forklift for Prolec, a joint venture with General Electric that makes transformers that used to be manufactured in the United States. A father of two, he earns about $100 for a six-day workweek.
Though he has received modest cost-of-living increases, his last raise was five years ago, when gas, food and household items were far cheaper, he said. It was also before his second son was born. Between housing, insurance, savings and other requisites, he is left with about $40 a week to buy food and other necessities for his family, he said.
“We’re all the same, fighting to make ends meet,” he said. “I don’t know anyone who is very comfortable.”
Those workers have no union, no voice, no one to speak for them and demand a living wage, unlike the middle-class American workers who had decent-paying jobs before NAFTA destroyed them. This is precisely the reason many American companies lobbied for NAFTA and moved blue-collar American jobs to a country where they could avoid unions, and workers would have no voice.
Now their products can be made at slave wages and transported into the United States without tariffs or taxes of any form, adding to their massive profits while the communities in America, who built many of these brand name industries, now are the home of deserted mills and factories; and new generations are floundering in mass unemployment and the scourge of hopelessness, contributing to many societal issues including opioid addiction and systemic poverty.
That has been NAFTA’s legacy: millions of middle-class American jobs vanished, workers in Mexico forced to live in poverty, while rich corporate operations just get richer and richer.
Further, the Public Citizen report explains, American manufacturing workers who lost their jobs were able to find new jobs only in the low-skill, low-wage service sectors, creating a new glut of workers that drove those wages down even further. By enabling companies to threaten to move to poorer countries, NAFTA also gave employers new clout in bargaining with workers, pushing wages down still more.
Mr. Trump often claims that he aims to “Make America great again.” If he is serious, he should start by completely repealing—not tweaking, adjusting or renegotiating —but completely repealing the disaster for working American families that has been NAFTA.