Sunday, June 29, 2008

NAFTA and the Elephant in the Room

By Laura Carlsen It's rare for the junior partners of NAFTA—Mexico and Canada—to have a chance to sit down and discuss regional integration without the dominating influence of the United States. Even when they do, of course, the U.S. is the elephant in the room. The University of the Americas in Puebla, Mexico hosted a conference recently on the Security and Prosperity Partnership (SPP) from the Canadian and Mexican perspective. Although most of the presentations were from academics, businessmen or government officials, our panel on civil society participation set me to reflecting on the long personal and political history of the nearly 15-year-old NAFTA and its offspring, the SPP. When negotiations on the free trade agreement with Mexico began in 1991, we had little idea of how a North American Free Trade Agreement would affect the country. But Canada had already been through it all. The U.S.-Mexico agreement sought to extend many of the terms of the 1989 U.S.-Canada agreement and patch them into a regional agreement. In the early nineties, it was clear that NAFTA represented a huge step forward in locking in the kinds of structural adjustment programs from the IMF and World Bank that had devastated sectors of the economy, and that it formed part of President Carlos Salinas de Gortari's project to extend the neoliberal economic model of trade liberalization and export-orientation, privatization, and withdrawal of the state from social programs and economic regulation. But we didn't know the specifics of what to expect and the whole process was being carried out in backrooms hermetically sealed to citizen participation. I felt like kind of a double agent at the time. I was working as a journalist and editor at Business Mexico, the magazine of the American Chamber of Commerce in Mexico, and had also been working with a Mexican non-governmental organization in communications and women's projects. The dual perspective was fascinating, to say the least. The mood in the Chamber of Commerce was one of euphoria, while the citizen movements felt a sense of impending doom. I had trouble reconciling the opposite scenarios being presented until I realized that it wasn't so much that one was right and one was wrong, but that the gap between the winners and losers in Mexico's economy was about to get much, much wider. At the magazine I began to specialize in stories about sectors that would suffer under the agreement, mainly smallscale agriculture and micro-industry oriented toward the domestic market. There was no real argument from promoters about the lack of "competitiveness" of these sectors—the argument was that these workers would be re-employed in new export-oriented, internationally financed industries. In the face of predictions of massive job loss, they blithely assumed that the market and high growth rates would work it all out. For U.S. businesses in Mexico, the greater mobility of capital and investor incentives in NAFTA presented a bright new day with nary a cloud in sight. Meanwhile, small farmers organizations couldn't believe they were being asked to compete with subsidized products from the world's largest exporter. Independent unions thought the trade-off between more maquiladora jobs, and downward pressure on wages and job security due to international competition between workers was sure to be a bum deal in the long term. Mexican trade activists decided on a two-part strategy: 1) demand information on the negotiations and 2) call the Canadians. Canadian citizen groups had developed excellent critiques of the FTA from labor and agriculture perspectives and analyzed the way the agreement could affect the social safety net. Although the two countries had very different political and economic contexts, these studies and the experience helped Mexicans to begin to project outcomes. Later, U.S. groups joined the networks as well. There was very little chance of influencing the negotiations, but the groups did manage to get more public information released. This was the birth of trinational networks that, with ups and downs, have continued to work together to oppose aspects of NAFTA and the SPP to this day. It hasn't been an easy process and mistakes have been made. Canadian and U.S. labor unions at first viewed Mexican workers not as allies but as unfair competition as their factories moved South. It wasn't until they began to see the conditions of the Mexican workers and analyze corporate strategies of pitting workers against workers that real solidarity and understanding set in. Mexican farmers thought U.S. and Canadian family farmers were closer to wealthy hacienda owners than to them, with their large expanses of land and fancy equipment. It wasn't until they heard the stories about the thousands of families going bankrupt and losing their farms and the control of agribusiness over all aspects of agriculture that they understood that they shared a struggle against an international system stacked against them. It was, as always, the human contact that broke the barriers. NAFTA set into motion a series of trinational meetings. If at first, the networks were joined by their victimhood, and they later began to share a vision of changing their respective economies in ways that supported rather than marginalized them. Over the past year the Institute for Agriculture and Trade Policy and other organizations have sponsored a couple of major meetings to take a look at what we've learned from NAFTA and the fight against corporate-led globalization. It gives me no great satisfaction to report that some of the most pessimistic predictions we made—the displacement of small farmers, lower than expected growth rates, the growing divide between the rich and the poor—have come true. And although many of us did not believe NAFTA would solve the immigration problem as its promoters predicted, few imagined the huge increase that occurred. We've also seen that despite advances, the challenges to our networks today are greater than ever. The extension of NAFTA into security issues under the SPP—in the logic of the Bush National Security Strategy—poses unprecedented dangers to Canadian and Mexican sovereignty. There is no better example of that than the recent Merida Initiative that fundamentally changes the nature of the U.S.-Mexico relationship. The focus on geopolitical goals over human security, and the imposition of U.S. foreign policy objectives on Mexico will have lasting and likely destabilizing effects as Mexico takes on the militarized vision of confronting public security challenges. The hegemonic policies of the U.S. government have made it easier in some ways for Canadians and Mexicans to talk about regional integration than U.S. citizens. Both feel threatened in many of the same ways, particularly by the pressure coming from the U.S. government within SPP and other channels over access to natural resources in their territories. U.S. groups face more difficult obstacles explaining and organizing on their turf, due to misinformation and the climate of fear manipulated to support government actions. Nonetheless, there is no question that we've come a long way. Polls in Canada and the United States show a majority believes NAFTA has not benefited their country. U.S. democratic presidential candidates demanded review and possible renegotiation of the agreement, and 200,000 Mexican farmers marched in the streets demanding renegotiation of the agricultural chapter. The relationships and networks built early on have grown as the trade agreement has filtered into the general public and generated widespread criticism of its effects on society in all three nations. Reflecting on these meetings, I think perhaps the biggest challenge now to our networks is not to centralize the struggle and the critique but to understand our differences. We have a pretty good understanding of the architecture built by NAFTA and added onto in the SPP. We need to continue to work together to analyze its foundations and mainstays. But we, the peoples of three nations, find ourselves in different rooms. Each must decide on priorities and national strategies to reform policies, relieve suffering and build alternative structures. It will be the confluence of these strategies from citizens of sovereign nations that enable us to join together and stop the way the SPP and its handful of corporate executives have imposed regional integration from the top down. Laura Carlsen (lcarlsen(a) is Director of the Americas Policy Program at in Mexico City.

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