NAFTA: North American Free Trade Agreement Implementation of the North American Free Trade Agreement (NAFTA) began on January 1, 1994, and is one of the United States’ most significant regional trade agreements. The final provisions of the NAFTA were fully implemented on January 1, 2008. With full implementation, the last remaining trade restriction on a handful of agricultural commodities such as U.S. exports to Mexico of corn, dry edible beans, nonfat dry milk and high fructose corn syrup and Mexican exports to the United States of sugar and certain horticultural products are now removed. As you can see this agreement will have the potential to remove most barriers to agricultural trade and investment among the United States, Canada, and Mexico and has benefited farmers, ranchers and consumers throughout North America. Under the NAFTA, all non-tariff barriers to agricultural trade between the United States and Mexico were eliminated.
NAFTA and the North American Worker The North American Free Trade Agreement (NAFTA) was signed into law on December 8, 1993 by former President Bill Clinton. The goal was to facilitate trade between the U.S., Mexico, and Canada by eliminating tariffs on goods traded between them, but it was also about creating jobs. William Orme (1996) affirmed, “From the beginning, the Bush Administration said NAFTA was about three things: ‘jobs, jobs, jobs’” (p. 112). The trade agreement was sold to the workers of North America with the promise of better jobs, higher pay, and faster growth, but it did not turn out this way for workers in the U.S., for workers in Mexico, or for workers in Canada.
The United States has for over two centuries been involved in the growing world economy. While the U.S. post revolutionary war sought to protect itself from outside influences has since the great depression and world war two looked to break trade restrictions. The United States role in the global economy has grown throughout the 20th century and as a result of several historical events has adopted positions of both benefactor and dependent. The United States trade policy has over time shifted from isolationist protectionism to a commitment to establishing world-wide free trade. Free trade enterprise has developed and grown through organizations such as the WTO and NAFTA. The U.S. in order to obtain its free trade desires has implemented a number of policies that can be examined for both their benefits and flaws. Several trade policies exist as options to the United States, among these fair trade and free trade policies dominate the world economic market. In order to achieve economic growth the United States has a duty to maintain a global trade policy that benefits both domestic workers and industry. While free trade gives opportunities to large industries and wealthy corporate investors the American worker suffers job instability and lower wages. However fair trade policies that protect America’s workers do not help foster wide economic growth. The United States must then engage in economic trade policies that both protect the United States founding principles and secure for tomorrow greater economic stability.
In a recent wave of discussion on CNBC of how the “Trade gap between these two giants has cost the United States a whooping US Dollars 37 Billion in wages”. The increasing deficit between the two giants has been linked to the loss of wages up to the highs of US Dollars 37 Million in the year 2011 (Holliday). The study conducted by the Economic Policy Institute (EPI) suggests that over 2.7 million jobs have been lost within the United States from the year 2001 to 2011.
“Economic efficiency” stated previously is an effect in the long run that doesn’t benefit the factory workers who could lose their job in the short-term. Free trade increases a nation’s overall economy and productivity, but at the same time, millions are forced to change careers as seen in a 2013 report showed how NAFTA -a free trade organization- forced one million U.S job losses (Williams J). In addition to this, Robinson also argues that free trade encourages businesses to move countries which entail “systematic labor abuses and destruction of the environment” in these poor environments. On top of these two cons, economists envision trade barriers to be insignificant but politicians signing trade agreements are always biased to their own interests. This leads to documents with heaps of loopholes and potential advantages for established businesses. In many cases, agreements replaced existing regulations with new ones that favored bigger
According to our textbook, globalization is one of the main reasons cited for rising income and wealth inequality in the United States. The rise in the trade of goods and services across national boundaries, as well as the increased mobility of multinational businesses and migrant labor is also a major factor. In the United States, globalization has bifurcated (or divided) jobs into two categories, high-skilled and low-skilled. Global inequality has been steadily rising over the past few hundred years, no question. Looking back to the time of the Industrial Revolution though, the vast population of the entire world was living in poverty.
Outsourcing has quickly became to go-to solution for businesses that wish to reduce costs, however, their cost saving comes with a price. The price is employment scarcity and American citizens are straining under the weight of corporate America’s choices. While all citizens are suffering, none are suffering as much as those who fall into either the low-income or disabled populations. These people are often faced with inadequate employment opportunities or unemployment. The outsourcing of products and services has contributed to this by moving many of the jobs that these people used to occupy overseas. Now, these people are left with nothing, but empty promises from politicians and mounting walls of debt that they can’t pay off (Freedman, 2005).
Imagine being employee number 101 out of 1001. Now imagine working on an assembly line in a hot room filled with 1000 other women frantically assembling products for first world countries to use for ten seconds before discarding for a newer version. This job pays enough for you to get by but living in a third world country with low pay isn’t easy. What many people don’t understand is that the cost of production in a third world country is more inexpensive than it is in America. Hiring women to work in horrid conditions decreases employee loss because they are not rambunctious like men. “Life on the Global Assembly Line” by Barbara Ehrenreich and Annette Fuentes clearly illustrates the hardships women go through for U.S. corporation production. Corporate powers have resorted to building production plants in third world countries to save money. U.S. corporate powers take advantage of third world
This article explains the economical side of trading and how the wage inequality is affected due to trading globally. In the beginning, Hanson talks about how the globalization of the nation and the shift in the flow of goods and jobs. Hanson has researched how the globalization affect the labor markets, industry’s location and internal organization, and the economies of different parts of the world. Hanson particularly narrows his research on the big countries that the United States usually outsources their exports with. Also in the introduction of the research, Hanson makes the statement that globalization of production attracts the low-cost regions to foreign markets, which consequentially has an effect on the location of the economic activity
Pundits argue that the days in which workers could gain leverage over capital and obtain rights in state legislation have been superseded by the process of globalization (Tilly 1995; Hobsbawm1995). It is argued that since the 1970s, in particular, nation-states and labor movements have ceased to be able to protect workers' rights in the face of mobile or "footloose" capital, which is free to move around the world in search of greater returns. With the triumph of the global market, workers are scripted as powerless and unable to defend their jobs, communities, and localities. These analysts argue that the industrial relations climate is one in which places, and those who live in them, are forced to compete for employment, ensuring that employment conditions and regulations are ratcheted down to the lowest common denominator (Beynon and Hudson 1993; Storper and Walker 1989; Burawoy 1985; Korten 1995).