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Free Trade, Controlled Labor

Steev Hise Apr 16

On Jan. 1. 1994, the North American Free Trade Agreement (NAFTA) went into effect, liberalizing trade, investment and capital flows across Mexico, Canada and the United States. One of the effects of NAFTA has been to increase Mexican immigration into the United States as many small farmers have lost their lands, unable to compete against heavily subsidized U.S. agribusinesses.

One of NAFTA’s main provisions was the reduction of price supports by the Mexican government for agricultural products. The treaty permitted the United States to continue agricultural subsidies, however, allowing farmers to sell their agricultural products on the Mexican market at rock-bottom prices – in the case of corn, about 35 percent below the cost of production. From 1995 to 2004, U.S. corn farmers received $41.9 billion in government subsidies.

A study published in 2004 by the nonprofit policy group Americas Program found that while the price of domestic corn in Mexico has fallen since 1994 the price of corn-based tortillas has increased by 279 percent. While some 3 million farmers in Mexico continue to grow corn, Mexico has now switched from a corn-exporting country to a corn-importing country.

The cultivation of corn first began in Mexico some 5,000 years ago, and thousands of varieties abound through the country. As a consequence of the low prices, many small farmers and their families have had to leave their homes and their land to survive. For those farmers who choose to stay, the only crops they can still make a living from are usually marijuana and poppies.

“Since the passage of NAFTA in 1994, more than three million campesinos have been forced to abandon agricultural production and look for jobs in maquiladoras [export-only factories] or as undocumented workers in the U.S.,” said Tom Hansen, National Coordinator for the Mexico Solidarity Network.

In 2000, Mexican president Vicente Fox raised the idea of free flow of people across the U.S.-Mexico border as a second phase of NAFTA. The events of Sept. 11 derailed this plan, however.

“Immigration morphed from a largely temporary, circular phenomena pre-1994 that involved perhaps 100,000 Mexicans annually, to a more permanent trend that involves almost halfa- million Mexicans annually, representing about one percent of the entire Mexican workforce,” Hansen stated.