Last month thousands of demonstrators filled Miami streets in a show of opposition to free trade unseen (at least in this country) since the battles in Seattle four years ago. Opponents hoped to hit the proposal for a Free Trade Area of the Americas with the same one-two punch that forced trade ministers to end talks in Cancun in October with no new agreement. Inside the meeting itself the new leftwing governments of Latin America -- Brazil, Ecuador, Argentina and Venezuela -- formed an implacable opposition. The ministers only agreed to continue talks on a scaled-down version of the FTAA, then left town a day early
As more demonstration and debate unfolds, in the eye of the storm is the one free trade agreement that already provides an idea of what the Americas can expect from the Bush free trade plan. On Dec. 8, the North American Free Trade Agreement was 10 years old. And for FTAA's opponents, that 10-year history of devastation, wreaked in Mexico and the US both, will be the key argument in stopping its extension to the rest of Latin America.
The communities of working people and the poor, on both sides of the border, have paid the price for trade liberalization, while the benefits have been reaped by the tiny clique who promoted NAFTA 10 years ago.
In one of life's ironies, successive secretaries of the US Department of Labor -- among NAFTA's most ardent supporters -- have kept close track of the treaty's high cost in US jobs. By 2002, the department had certified that 408,000 workers qualified for extensions of unemployment benefits, because their employers had moved their jobs south of the border.
Most observers believe this is a vast undercount. According to NAFTA At Seven, a 2001 report by the Economic Policy Institute, "NAFTA eliminated 766,030 actual and potential US jobs between 1994 and 2000 because of the rapid growth in the net US export deficit with Mexico and Canada."
While the job picture for US workers was grim, NAFTA's impact on Mexican jobs was devastating. Before leaving office (and Mexico itself, pursued by charges of corruption), President Carlos Salinas de Gortari promised Mexicans they would gain the jobs the US lost. And on tours to the US to promote the treaty, he promised that this job gain, although painful for US workers, would halt the northward flow of Mexican job seekers.
NAFTA's first year saw instead the loss of over a million jobs all across Mexico, in the wake of economic crisis. To attract investment, NAFTA-related reforms required the privatization of factories, railroads, airlines and other large enterprises. This led to further huge waves of layoffs. And because unemployment and economic desperation in Mexico increased, immigration to the US has been the only hope for survival for millions of Mexicans.
For a while, however, it seemed that the growth of maquiladora factories along the border would make up for at least part of the job loss. By 2001, over 1,300,000 workers were employed in over 2000 border plants, according to the Maquiladora Industry Association. But tying the jobs of so many Mexicans to the US market, for which the plants were producing, proved a disaster as well. When US consumers stopped buying as the recession hit in 2001, maquiladoras also began shedding workers. The Mexican government estimates that over 400,000 jobs disappeared in the process -- as the saying goes on the border, when the US economy catches cold, Mexico gets pneumonia. A two-year PR campaign by the association and the Mexican government to blame the loss in border jobs on Chinese competition then sought to obscure the fact that the plants produced far more goods than a recession-plagued market in the US could absorb.
But the most serious consequence of NAFTA has been its failure to protect the rights of workers as promised by its supporters. To attract investment to the maquiladoras, Mexican government authorities cooperated with investors and compliant official unions in maintaining a low-wage economy, reinforced with a system of labor control.
According to Martha Ojeda, director of the Coalition for Justice in the Maquiladoras, the government-mandated minimum wage for workers on the border is about $4.20. She estimates that a majority of maquiladora workers earn close to this wage.
A study by the Center for Reflection, Education and Action, a religious research group, found that at the minimum wage, it took a maquiladora worker in Juarez almost an hour to earn enough money to buy a kilo (2.2 pounds) of rice, and a worker in Tijuana an hour and a half. And yet another study by the Economics Faculty of the National Autonomous University in Mexico City says Mexican wages have lost 81% of their buying power in the last two decades.
To enforce this system, maquiladora workers are required to belong to unions that have no intention of raising those low wages or helping them end exhausting and dangerous working conditions. Throughout NAFTA's 10-year history, workers have sought to break free in a long labor war waged from plant to plant along the border. They have organized independent unions, willing to fight for a larger share of the enormous wealth the factories produce. But these efforts have been met with firings, plant closures, and even physical violence.
Ten years of hearings held under NAFTA's labor side-agreement have documented extensive violations of labor rights. In those few instances in which workers have successfully formed independent unions, as they did at Tijuana's Han Young plant in 1998-9, their strikes were broken, despite guarantees under Mexico's Constitution and Federal Labor Law.
NAFTA's sponsors promised that the treaty's labor side-agreement would protect workers, even though the treaty itself was intended to demolish all barriers to foreign investment. The side-agreement proved toothless. In 10 years not one fired worker has been returned to his or her job, and not one independent union has gained legal status and a contract as a result of the NAFTA process.
Instead, the historical labor protections built into Mexico's legal system have been systematically undermined and eliminated as obstacles to investment. Even when Mexican judges held that strikes were legal, as did Maria Lourdes Villagomez Guillon of the Federal 5th District in 1998, and Pedro Fernandez Reyes Colin of the First Collegial Court of the Fifteenth District (Baja California's highest judicial authority) in 1999, their decisions were defied with impunity by government authorities. Under NAFTA, breaking strikes and unions on the border has become an integral part of economic development, and legal protections for workers have been swept away.
Four years ago, at the height of the protests against the World Trade Organization, Zwelenzima Vavi, the head of the South African Congress of Trade Unions, described the alternative to NAFTA and the free trade philosophy underpinning it. "In the pursuit of profit," he said, "governments are told to remove worker protections, and then use that as an inducement for investment. But development is a wider concept. It includes social development, and the living conditions of the people. Development can't exist with mass unemployment and poverty."
As US officials try to salvage the Free Trade Area of the Americas, these are the words that critics of NAFTA and FTAA will put before the world.
David Bacon is a journalist in Berkeley, Calif. Email dbacon@igc.org.