Report: NAFTA Turns 20

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In this Thursday, Dec. 26, 2013 photo, a family leaves a local Walmart in Mexico City. (AP Photo/Marco Ugarte)

This post originally appeared at the Campaign for America’s Future.

Public Citizen’s Global Trade Watch has issued a new report, NAFTA at 20: One Million US Jobs Lost, Mass Displacement and Instability in Mexico, Record Income Inequality, Scores of Corporate Attacks on Environmental and Health Laws. The report compares the promises with which NAFTA was sold with the results we can measure 20 years later.

NAFTA was not just a “trade” agreement. Trade agreements focus on cutting tariffs and easing quotas and barriers to goods moving across borders. The report points out that NAFTA was much more, giving corporations special rights, incentivizing offshoring and limiting regulation. As the report puts it:

“NAFTA created new privileges and protections for foreign investors that incentivized the offshoring of investment and jobs by eliminating many of the risks normally associated with moving production to low-wage countries. NAFTA allowed foreign investors to directly challenge before foreign tribunals domestic policies and actions, demanding government compensation for policies that they claimed undermined their expected future profits. NAFTA also contained chapters that required the three countries to limit regulation of services, such as trucking and banking; extend medicine patent monopolies; limit food and product safety standards and border inspection; and waive domestic procurement preferences, such as Buy American.”

Some of the effects of NAFTA that are highlighted in the report include:

  • a $181 billion US trade deficit with NAFTA partners Mexico and Canada,
  • one million net US jobs lost because of NAFTA,
  • a doubling of immigration from Mexico,
  • larger agricultural trade deficits with Mexico and Canada,
  • more than $360 million paid to corporations after “investor-state” tribunal attacks on, and rollbacks of, domestic public interest policies.

The data also show how post-NAFTA trade and investment trends have contributed to:

  • middle-class pay cuts, which in turn contributed to growing income inequality,
  • US trade deficit growth that is 45 percent higher with Mexico and Canada than with countries not party to a US Free Trade Agreement,
  • US manufacturing and services exports to Canada and Mexico growing at less than half the pre-NAFTA rate.

The report lists and details many, many more such outcomes.

“NAFTA’s actual outcomes prove how damaging this type of agreement is for most people, that it should be renegotiated and why we cannot have any more such deals that include job-offshoring incentives, requirements we import food that doesn’t meet our safety standards or new rights for firms to get taxpayer compensation before foreign tribunals over laws they don’t like,” said Lori Wallach, director of Public Citizen’s Global Trade Watch.

The report also points out that the public “gets it” that NAFTA hurt the country.

“According to a 2012 Angus Reid Public Opinion poll, 53 percent of Americans believe the United States should “do whatever is necessary” to “renegotiate” or “leave” NAFTA, while only 15 percent believe the United States should “continue to be a member of NAFTA.”

Dave Johnson is a fellow with Campaign for America’s Future and a senior fellow with Renew California.
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  • Anonymous

    Actually his corporate handlers and Wall St want it. Their arms are up Obama’s butt controlling his every word.

  • Anonymous

    Corporations did well, common folks not so well….

  • Andy Boyle

    Just to let you know, we are suffering in Canada as much or more than you. Our manufacturing sector has almost disappeared and the cost of pharmaceuticals is skyrocketing. No benefits reached the Canadian worker. When “they” said NAFTA would generate trade or that trade has increased, all they are talking about is the movement of capital not the creation of real jobs. Let’s renegotiate and we really wish you start by taking Wal Mart and Monsanto back and so no to tar sand pipelines.

  • nnyl

    And now they want to foist the TPP on us. No thanks!

  • Matt Pantages

    actually this was campaigned for by mexico and GHWBush… Clinton just happened to take office as this was finalized.. he only signed it..

    “…Following diplomatic negotiations dating back to 1986 among the three nations, the leaders met in San Antonio, Texas, on December 17, 1992, to sign NAFTA. U.S. President George H. W. Bush, Canadian Prime Minister Brian Mulroney and Mexican President Carlos Salinas, each responsible for spearheading and promoting the agreement, ceremonially signed it. The in an agreement then needed to be ratified by each nation’s legislative or parliamentary branch.

    Before the negotiations were finalized, Bill Clinton came into office in the U.S. and Kim Campbell in Canada, and before the agreement became law, Jean Chrétien had taken office in Canada.”

  • Anonymous

    yep… the “giant sucking sound” of jobs leaving.

  • G.Ray

    I’m sure one million jobs lost is a low estimate, but it sure pulled the rug from under the middle class. Ross Perot was one of the few major politicians who predicted its negative effects and was vehemently against it. I’d love to hear what Mr. Perot has to say about it now.

  • Big Bopper

    Bill still signed it, and praised it as good for the economy. Yea, if your company gets rebated for off shoring jobs!

  • Anonymous

    It’s a rigged game and the gov’t is rigging it for the corps. It matters not what the color of the the gov’t stripes are.

  • Big Bopper

    Bill signed the agreement and pushed it a good for the US economy. Trade deals are negotiated by corporations with govt. negotiators present. As we know Washington is run by corporations, so there is no one at the table with any real concern about how these deals play out for the citizens of the countries involved. It’s all about consolidation wealth and control over patents, environmental regulation and labor.

  • TC

    Every living president, including Reagan, was for it. Lots of blame to go around.

  • Tim Collins

    Nafta may have worked if the kept the rules inside the Nafta territory, unfortunately it opened the door to China, SE asia, Pakistan and India. Bring back quotas and support building our infrastructure….

  • arsailman1

    This is the worst possible trade deal ever…

  • Anonymous

    Remember when we imported all the Panasonic from Japan? They said that they didn’t want anything we have, yet apples were $5 each. So what did Japan do with all the US bucks? They now own 85%+ of Hawaii. China tried to steal US military secrets. All they had to do was buy some military supply industries. BALANCE of trade is fair to the US. Not sucker deals. NAFTA should be replaced with something more balanced, not shaft the US with TPP.
    Any politician who pushes TPP should be impeached and tried for TREASON. We really need to clean up campaign donor corruption. That is the rot that is destroying our country.