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On Monday, our guides provide an orientation to give us the background to understand what we will be hearing over the coming days. There is an overview of the concept of free trade and globalization. We learn about how it is applied in NAFTA (the North American Free Trade Agreement ) and the effects on the U.S., Canada and Mexico. We role play to get an idea of it's effects on different groups, such as Mexican corn farmers, U.S. tomato farmers, and business owners in Mexico and the U.S.

Free Trade

Briefly, the idea of free trade is that it is best for all involved for trade to be allowed to occur without any barriers, such as tariffs imposed by one country on the goods of another. The idea is that it is to the benefit of all for goods to be grown or produced where this can be done most cheaply. These goods can then be exported and other goods imported that are best produced elsewhere. That is the theory. We were to hear from many Mexican speakers over the next several days about the actual effects of these policies.

NAFTA

NAFTA is the North American Free Trade Agreement between Canada, Mexico and the United States that took effect in 1994. It embodies many of the ideas of free trade in that it provides for the elimination of many tariffs on products such as agriculture and manufactured goods between the U.S., Canada and Mexico. The proponents for NAFTA argued that it would be beneficial for Mexico. Due to lower labor costs in Mexico than in the U.S., Mexico stood to gain manufacturing jobs.

The U.S., on the other hand could grow greater quantities of many agricultural products at a lower cost due to mechanization and terrain more favorable to large scale production (U.S. farmers are also heavily subsidezed.) Although Mexico would likely lose lose agricultural jobs as it imported more U.S. agricultural products, these jobs would be more than replaced by employment in manufacturing. And the lower cost of agricultural products from the U.S. would lead to lower prices for food.

Unfortunately, these expectations did not come to pass. We were to learn that fewer jobs were created than were lost. Nor did the cost of buying food for a typical Mexican family go down, but wages did, and the purchasing power of the minimum wage is 20% less than it was in 1994.

REMALC

Shaun and Nicki with the REMALC representative

Our first exposure to the effects of NAFTA from a Mexican point of view was in the late afternoon when we met with a representative from the Mexican Action Network on Free Trade, or RMALC. He summarized the effect of a dozen years of NAFTA on farmers and on Mexico overall. The speaker told how Mexico had moved from food self-sufficiency to importing a large percentage of their corn and beans, and most of their milk and rice. Approximately one million jobs farming corn have been lost, and these have not been made up by job gain in manufactoring as was supposed to happen. Furthermore the manufacturing jobs that have been created do not pay as well as the agricultural jobs which were lost.

Much of the imported corn is genetically modified. There is a grave risk of this modified corn being released into the countryside of Mexico and endangering native plants. Mexico is the birthplace of corn and has thousands of native varieties, but these native plants could be crowded out by the modified strains, threatening the biodiversity of the planet. With fewer strains, those that remain are more vulnerable to a single disease.

A report by Sara Anderson of the Institute for Policy Studies, Seven Years Under NAFTA, summarizes some of the effects experienced by ordinary Mexicans from 1994 - 2001. Although manufacturing productivity rose by 47%, manufacturing wages declined by 21%. The real value of the minimum wage fell in that period by 19%. The number of Mexicans living in poverty increased from 50.97% of the population to 58.4%.

The Zocolo and Recent History

Earlier in the day we had gone to the Zocolo where we visited the Metropolitan Cathedral, built by the Spanish beginning in 1573. although the two bell towers and the central dome were not complete until 1813. The cathedral was partially build from dismantled Aztec temples. While visiting the cathedral, and later at the National Palace, which houses several Diego Rivera murals, we were given a short history of Mexico.

Some recent history is that for many years all winners of the presidential elections were members of the PRI party. This ended in 2000 with the election of Vicente Fox. In the most recent election, which just occurred this summer, neither of the two major contenders was a member of the PRI. The PAN (National Action Party)canditade, Felipe Calderón, has promised to continue the free trade policies of Vicente Fox. He had more support in northern Mexico, while the PRD (he Party ofthe Democratic Revolution) candidate, López Obrador, was more heavily favored in the south, which has a higher indigenous population. The results of this election were still being disputed at the time of our visit.

Shopping

On the way home we were given a day's wages at the Mexican minimum wage of about 47 pesos, or $4.50, with the task of buying food for a few days for a family of four. Here is the cost of several items that we found, showing the cost in pesos, and the approximate number of hours a Mexican worker would have to labor at minimum wage to buy the item. From 1994 to 2002, the prices of a basic basket of food items increased by 257% in Mexico. In 2002, 73% of the population couldn't afford a shopping basket of forty basic items. Since NAFTA (1994 - 2002), wages have lost 50% of their purchasing power.

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