Corporate trade and culture wars

The Central American Free Trade Agreement (CAFTA) is up for Senate Finance Committee consideration today. The Bangor-based Peace through Interamerican Community Action reports that Sen. Olympia Snowe may be a key swing vote on this measure.

Impending action on this measure makes this is an especially appropriate time to re-examine corporate trade initiatives. The North American Free Trade Agreement (NAFTA), on which CAFTA is modeled, has been a source not only of economic distress but also of cultural tensions. Economic distress and forced migration have led to increasing nationalism and racism in all three signatories to the original agreement. Globalization, as New York Times columnist Thomas Friedman argues, may be inevitable and desirable. Nonetheless, globalization, like capitalism, can take many forms. A globalization attentive only to corporate interests may paradoxically feed xenophobic impulses.

NAFTA’s supporters promised that increased trade would lead to more jobs and more rapid economic growth as each nation specialized in what it did best. Trade has increased, but trade’s effect on jobs depends on the net of exports over imports. Jobs are not created if U.S. manufacturers send new machines to Mexico and then end up importing even more in finished goods from Mexico. Yet this is exactly what has happened. The Economic Policy Institute reports that every U.S. state has seen a net loss of manufacturing jobs from NAFTA, with Maine’s loss pegged at around 2,500 jobs.

For states like California and Arizona, the losses have obviously been even more substantial. These states have confronted a dual whammy. Just as many good jobs are being lost, these states have faced an influx of immigrants, primarily from Mexico. Not only have conditions in manufacturing industries worsened in the United States but also in Mexico. NAFTA enabled the export of subsidized corn to Mexico and led to the displacement of large numbers of Mexican farmers.

In addition, the new manufactur-ing jobs were located in isolated maquiladora areas just across the border. Carlos Salas, a Mexican labor economist, reports, “these export platforms – in which wages, benefits, and workers’ rights are deliberately suppressed – are isolated from the rest of the Mexican economy. They do not contribute much to the development of Mexican industry or its internal markets, which was the premise upon which NAFTA was sold. Compensation and working conditions for most Mexican workers have deteriorated.”

With high-paying jobs declining and more Mexicans entering the United States in desperate search of a better life, the Southwest, where a kind of cowboy machismo has long gripped many citizens, has been ripe for a cultural explosion. In the last year, even against the recommendations of state business and media leaders, Arizona endorsed a harsh anti-immigrant referendum. Among other things, Proposition 200 made it a crime for state government workers to fail to alert immigration authorities about the suspected presence of illegal immigrants.

On the academic front, Samuel Huntington, famous for earlier work on the “clash of civilizations,” now has weighed in against the increasing Hispanic presence in the United States. He charges that Mexican immigration is more persistent, more regionally concentrated, less committed to education and more attached to its native culture and values. He worries that America is on the brink of becoming a cultural bifurcated Anglo-Hispanic society with two national languages.

Huntington’s litany of charges against Mexican immigrants presents a set of evidentiary issues and internal contradictions. Huntington faults Mexican immigrants for unwillingness to learn English, but demand for English as a second language courses in the Southwest far exceeds the supply. He faults Mexicans for repatriating much of what they earn. I am left wondering why can GM export its capital to Monterrey, but it is awful when Mexican peasants do so.

Free trade is in fact a misnomer. Business is free to relocate, but workers must accept national boundaries. Historically some unions, and many working-class citizens, believe that strengthening sanctions against illegal immigrants will improve their own job prospects. Yet increased sanctions only give employers more ways to discipline discontented workers.

CAFTA must be rejected, but it needs to be replaced by a charter of rights for all who work here as well as effective guarantees for labor organizing in all nations that are party to trade pacts. When all workers within our borders enjoy a right to a decent wage and to organize collectively, it is harder for employers to ratchet wages and working standards down.

The benefits of broad collaboration over immigrant rights are more than merely economic. A century ago, Irish and Italian immigrants were subject to many of the same charges Huntington levels against Mexican immigrants. They added immensely to the culture and economy of the United States.

Hardly hordes of barbarians eager to conquer us, most Mexican immigrants work hard and many intend to return home. Their concerns for family time and for their own culture can only broaden and enhance our fluid and evolving culture.

John Buell is a political economist who lives in Southwest Harbor. Readers wishing to contact him may e-mail messages to jbuell@acadia.net