Nafta should be revisited every 10 yrs or so because things change around the world...Nafta is for the benefit of just not 1 country but for the continent as a whole....
In 1992 (and 1993) Bill Clinton, et al. promised that NAFTA would result in a significant increase in the number of high quality jobs for Americans, that it would dramatically reduce illegal immigration, and that it would generate a rising trade surplus with Mexico. NAFTA was enacted on Jan 1, 1994. It was revisited in 2004 under Junior Bush and everyone said, "Give it some time." It was again revisited in 2014 under Obama and Obama said, "It's great! I wanna expand it to the entire Pacific Rim."
In 1992 Ross Perot said,
"We have got to stop sending jobs overseas. It's pretty simple: If you're paying $12, $13, $14 an hour for factory workers and you can move your factory South of the border, pay a dollar an hour for labor,...have no health care—that's the most expensive single element in making a car— have no environmental controls, no pollution controls and no retirement, and you don't care about anything but making money, there will be a giant sucking sound going south. ...when [Mexico's] jobs come up from a dollar an hour to six dollars an hour, and ours go down to six dollars an hour, and then it's leveled again. But in the meantime, you've wrecked the country with these kinds of deals."
The alleged thinking was, it would dramatically reduce illegal immigration by creating lots and lots of high paying jobs in Mexico, thus people would be motivated to stay in Mexico rather than come here to work. Lots and lots of jobs were created, but they paid the prevailing rate, where the labor market set the price, same as any other market.
It as also thought that increased Mexican employment would mean increased exports from the US to Mexico because Mexicans would be clamoring to buy our products. That didn't happen. A large part of the problem, and one reason why the export numbers don't appear to be as bad as they really are, is many US exports are simply being shipped to Mexican factories (specifically,
maquiladores)where they are assembled, and then shipped back to the U.S. as final products. These are not products destined for import consumption by Mexicans, yet they made up 68% of exports, and they are counted as part of the export numbers. And because the assembled parts often times come back in duty-free (as with many auto component assemblies when the raw materials originated here), they are not counted as part of the import numbers, so as to make the trade deficit look to be a lot less than it actually is.
And, the thinking went, or at least how it was presented, because of the increased exports, lots and lots of high paying jobs would be created here to support those exports. That didn't happen, either.
Clinton was wrong, Junior was wrong, Obama was wrong.
Ross Perot was dead-on-balls accurate, though.
And even today, people point to the low unemployment figures, including those in manufacturing, and tout NAFTA's success. They don't take into account the ridiculous labor participation rate and the number of people who have just given up on finding work, and when they look at the manufacturing unemployment figures, they calculate those numbers based on current need and capacity versus the jobs that go unfilled. They don't take into account the massive numbers of jobs that have been lost due to the need not being there, because they were moved out of the country. Only domestically produced exports are the ones that support U.S. labor, so the measure of net impact of trade should be calculated using only domestically produced exports as an indicator of job creation, not the stuff that gets exported just so that it can be imported.
As of 2014, NAFTA has resulted in a staggering $181 billion U.S. trade deficit with NAFTA partners Mexico and Canada and the related loss of 1 million net U.S. jobs. growing income inequality due to the dramatically reduced wages and near decimation of the middle class, and a doubling of desperate immigration from Mexico.
Among many, many others, Allied Signal, General Electric, Johnson and Johnson, Kimberly-Clark, AT&T, Mattel, Proctor and Gamble, Siemens, Whirlpool, Xerox and Zenith all made specific promises to create or maintain jobs, and all have laid off workers because of NAFTA as certified by the U.S. Department of Labors NAFTA TAA (retraining) program. Some have moved 100% of production out of the country. And according to the same Department of Labor NAFTA TAA, the NAFTA-related job loss for the companies in the report (which are manufacturing jobs directly for consumers, both domestic and for export to other countries, i.e., Master locks, Levi's jeans, Barbie dolls, anything Fischer-Price, anything Mattel, Converse sneakers, televisions, Huffy bikes, auto parts and automobiles, air compressors) has increased 276%, and the number of jobs lost directly due to a "shift in production to Mexico" for the same group has increased by 480%.(these figures do not include jobs shipped to China and other countries).
The high paying jobs that were created since NAFTA was implemented have not been in manufacturing, but mostly in high tech, the disturbingly overwhelming percentage being filled by non-US citizens through H1B visas. It's not like a laid off auto worker in Warren, OH can just up and move to Silicon Valley and get a job. But those high paying non-citizen jobs are counted in the unemployment figures, as are the $10 an hour service jobs that the $30 hour former-auto and manufacturing worker has been forced to take.
The government's monthly and quarterly unemployment figures are BS, the "newly created jobs" figures are BS, and so are the "net jobs created" because of NAFTA and Free Trade.
It doesn't make sense, until you see the invoice from China. My son got some info on handling flashlights made in China, he could buy them for about 50cents each and they sell for 9.95 in the store...
That's exactly it. The market sets the retail price of anything. The cost to produce them doesn't, the cost of advertising doesn't. If the cost to produce products set the price, those 50 cent flashlights would be selling for a dollar or two, tops. They will tell you that if we don't move jobs to Mexico, the products would cost more. Yet, they move jobs to Mexico, where it is dramatically cheaper to produce, and does the price suddenly drop? Nope. But the bottom line profit sheet of the company that moved those jobs there sure went up. "But, but, but, we can't compete with the cheaper labor from imported products from other countries." Except they can, with Fair Trade instead of Free Trade.
