Globalization and NAFTA Caused Migration from Mexico
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Sid Shniad
2014-10-14 21:35:15 UTC
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Research Associates October 11, 2014Globalization and NAFTA Caused
Migration from MexicoBy David Bacon*

[image: Click here to see the full neoliberalism issue of The Public Eye
magazine] <http://www.politicalresearch.org/resources/magazine/>

Click here to see the full neoliberalism issue of The Public Eye magazine
When NAFTA was passed two decades ago, its boosters promised it would bring
“First World” status for the Mexican people. Instead, it prompted a great
migration north.

Rufino Domínguez, the former coordinator of the Binational Front of
Indigenous Organizations, who now heads the Oaxacan Institute for Attention
to Migrants, estimates that there are about 500,000 indigenous people from
Oaxaca living in the U.S., 300,000 in California alone.1

In Oaxaca, some towns have become depopulated, or are now made up of only
communities of the very old and very young, where most working-age people
have left to work in the north. Economic crises provoked by the North
American Free Trade Agreement (NAFTA) and other economic reforms are now
uprooting and displacing these Mexicans in the country’s most remote areas,
where people still speak languages (such as Mixteco, Zapoteco and Triqui)
that were old <http://www.latinola.com/story.php?story=3908> when Columbus
arrived from Spain.2
“There are no jobs, and NAFTA forced the price of corn so low that it’s not
economically possible to plant a crop anymore,” Dominguez says. “We come to
the U.S. to work because we can’t get a price for our product at home.
There’s no alternative.”
[image: Rosalba Maritero is a Triqui indignous immigrant from Oaxaca and
lives in Madera, California. She and her husband, both farm workers, were
strikers at a large berry farm in Washington State last year and helped
organize a new union, Familias Unidas por la Justicia/Families United for
Justice. Photo by David Bacon.]
<Loading Image...>

Rosario Ventura is a Triqui indignous immigrant from Oaxaca and lives in
Madera, California. She and her husband, both farm workers, were strikers
at a large berry farm in Washington State last year and helped organize a
new union, Familias Unidas por la Justicia/Families United for Justice.
Photo by David Bacon.

According to Rick Mines, author of the 2010 Indigenous Farm Worker Study
“the total population of California’s indigenous Mexican farm workers is
about 120,000 
 a total of 165,000 indigenous farm workers and family
members in California.”3
Counting the many indigenous people living and working in urban areas, the
total is considerably higher. Indigenous people made up 7% of Mexican
migrants in 1991-3, the years just before the passage of the North American
Free Trade Agreement. In 2006-8, they made up 29%—four times more.4

California has a farm labor force of about 700,000 workers, so the day is
not far off when indigenous Oaxacan migrants may make up a majority. They
are the workforce that has been produced by NAFTA and the changes in the
global economy driven by free-market policies. Further, “the U.S. food
system has long been dependent on the influx of an ever-changing,
newly-arrived group of workers that sets the wages and working conditions
at the entry level in the farm labor market,” Mines says. The rock-bottom
wages paid to this most recent wave of migrants—Oaxaca’s indigenous
people—set the wage floor for all the other workers in California farm
labor, keeping the labor cost of California growers low, and their profits
*Linking Trade and Immigration*

U.S. trade and immigration policy are linked. They are part of a single
system, not separate and independent policies. Since NAFTA’s passage in
1993, the U.S. Congress has debated and passed several new trade
agreements—with Peru, Jordan, Chile, and the Central American Free Trade
Agreement. At the same time, Congress has debated immigration policy as
though those trade agreements bore no relationship to the waves of
displaced people migrating to the U.S., looking for work. Meanwhile,
heightened anti-immigrant hysteria has increasingly demonized those
migrants, leading to measures to deny them jobs, rights, or any equality
with people living in the communities around them.

To resolve any of these dilemmas, from adopting rational and humane
immigration policies to reducing the fear and hostility towards migrants,
the starting point must be an examination of the way U.S. policies have
produced migration—and criminalized migrants.

Trade negotiations and immigration policy were formally joined together by
the Immigration Reform and Control Act (IRCA) of 1986. Immigrants’ rights
activists campaigned against the law because it contained employer
sanctions, prohibiting employers for the first time on a federal level from
hiring undocumented workers and effectively criminalizing work for the
undocumented. IRCA’s liberal defenders argued
its amnesty provision justified sanctions and militarizing the border,5
as well as new guest worker programs. The bill eventually did enable more
than 4 million people living in the U.S. without immigration documents to
gain permanent residence. Underscoring the broad bipartisan consensus
supporting it, the bill was signed into law by Ronald Reagan.

We come to the U.S. to work because we can’t get a price for our product at
home. There’s no alternative. — Rufino Dominguez, Director of the Oaxacan
Institute for Attention to Migrants

Few noted one other provision of the law. IRCA set up a Commission for the
Study of International Migration and Cooperative Economic Development to
study the causes of immigration to the United States. The commission held
hearings after the U.S. and Canada signed a bilateral free trade agreement,
and made a report to President George H.W. Bush and Congress in 1990. It
found that the main motivation for coming to the U.S. was poverty. To slow
or halt the flow of migrants, it recommended that “U.S. economic policy
should promote a system of open trade 
 the development of a U.S.-Mexico
free trade area and its incorporation with Canada.” But, it warned, “It
takes many years—even generations—for sustained growth to achieve the
desired effect.”

The negotiations that led to NAFTA started within months. As Congress
debated the treaty, then-Mexican President Carlos Salinas de Gortari toured
the United States, telling audiences unhappy at high levels of immigration
that passing NAFTA would reduce it by providing employment for Mexicans in
Mexico. Back home, he made the same argument. NAFTA, he claimed
<http://www.csmonitor.com/1993/1119/19014.html>, would set Mexico on a
course to become a first-world nation.6
“We did become part of the first world,” says Juan Manuel Sandoval of
Mexico’s National Institute of Anthropology and History. “The back yard.”7
*Increasing pressure*

NAFTA, however, did not lead to rising incomes and employment in Mexico,
and did not decrease the flow of migrants. Instead, it became a source of
pressure on Mexicans to migrate. The treaty forced corn grown by Mexican
farmers without subsidies to compete in Mexico’s own market with corn from
huge U.S. producers, who had been subsidized by the U.S. Agricultural
exports to Mexico more than doubled during the NAFTA years, from $4.6 to
$9.8 billion annually. Corn imports rose from 2,014,000 to 10,330,000 tons
from 1992 to 2008. Mexico imported 30,000 tons of pork in 1995, the year
NAFTA took effect. By 2010, pork imports, almost all from the U.S., had
grown over 25 times, to 811,000 tons. As a result, pork prices received by
Mexican producers dropped 56%.8

According to Alejandro Ramírez, general director of the Confederation of
Mexican Pork Producers, “We lost 4,000 pig farms. Each 100 animals produce
5 jobs, so we lost 20,000 farm jobs directly from imports. Counting the 5
indirect jobs dependent on each direct job, we lost over 120,000 jobs in
total. This produces migration to the U.S. or to Mexican cities—a big
problem for our country.”9
Once Mexican meat and corn producers were driven from the market by
imports, the Mexican economy was left vulnerable to price changes dictated
by U.S. agribusiness or U.S. policy. “When the U.S. modified its corn
policy to encourage ethanol production,” he charges, “corn prices jumped
100% in one year.”10

NAFTA then prohibited price supports, without which hundreds of thousands
of small farmers found it impossible to sell corn or other farm products
for what it cost to produce them. Mexico couldn’t protect its own
agriculture from the fluctuations of the world market. A global coffee glut
in the 1990s plunged prices below the cost of production. A less entrapped
government might have bought the crops of Veracruz farmers to keep them
afloat, or provided subsidies for other crops.

But once free-market structures were in place prohibiting government
intervention to help them, those farmers paid the price. Campesinos from
Veracruz, as well as Oaxaca and other major corn-producing states, joined
the stream of workers headed north.11
There, they became an important part of the workforce in U.S.
slaughterhouses and other industries.

U.S. companies were allowed to own land and factories, eventually anywhere
in Mexico. U.S.-based Union Pacific, in partnership with the Larrea family,
one of Mexico’s wealthiest, became the owner of the country’s main
north-south rail line and immediately discontinued virtually all passenger
Mexican rail employment dropped from more than 90,000 to 36,000. Railroad
workers mounted a wildcat strike to try to save their jobs, but they lost
and their union became a shadow of its former self.

According to Garrett Brown, head of the Maquiladora Health and Safety
Network, the average Mexican wage was 23% of the U.S. manufacturing wage in
1975. By 2002, it was less than an eighth. Brown says that after NAFTA,
real Mexican wages dropped by 22%, while worker productivity increased 45%.
*Attracting Investors, Repelling Workers*

Low wages are the magnet used to attract U.S. and other foreign investors.
In mid-June, 2006, Ford Corporation, already one of Mexico’s largest
employers, announced
it would invest $9 billion more in building new factories.14
Meanwhile, Ford closed 14 U.S. plants, eliminating the jobs of tens of
thousands of U.S. workers. Both moves were part of the company’s strategic
plan to cut labor costs and move production. When General Motors was bailed
out by the U.S. government in 2008, it closed a dozen U.S. plants, while
its plans for building new plants in Mexico went forward
without hindrance.15
These policies displaced people, who could no longer make a living as
they’d done before. The rosy predictions of NAFTA’s boosters that it would
raise income and slow migration proved false. The World Bank, in a 2005
study made for the Mexican government, found that the extreme rural poverty
rate of around 37% in 1992-4, prior to NAFTA, jumped to about 52% in
1996-8, after NAFTA took effect. This could be explained, the report said
<https://openknowledge.worldbank.org/handle/10986/8286>, “mainly by the
1995 economic crisis, the sluggish performance of agriculture, stagnant
rural wages, and falling real agricultural prices.”16

By 2010, 53 million Mexicans were living in poverty
according to the Monterrey Institute of Technology—half the country’s
The growth of poverty, in turn, fueled migration. In 1990, 4.5 million
Mexican-born people lived in the U.S. A decade later, that population more
than doubled to 9.75 million, and in 2008 it peaked at 12.67 million.
Approximately 9.4% of all Mexicans now live in the U.S., based on numbers
from Pew Hispanic. About 5.7 million were able to get some kind of visa;
but another 7 million couldn’t, and came nevertheless.18
From 1982 through the NAFTA era, successive economic reforms produced
migrants. The displacement had already grown so large by 1986 that the
commission established by IRCA was charged with recommending measures to
halt or slow it. Its report urged that “migrant-sending countries should
encourage technological modernization by strengthening and assuring
intellectual property protection and by removing existing impediments to
investment” and recommended that “the United States should condition
bilateral aid to sending countries on their taking the necessary steps
toward structural adjustment.” The IRCA commission report acknowledged the
potential for harm, noting (in the mildest, most ineffectual language
possible) that “efforts should be made to ease transitional costs in human

In 1994, however, the year the North American Free Trade Agreement took
effect, U.S. speculators began selling off Mexican government bonds.
According to Jeff Faux, founding director the Economic Policy Institute, a
Washington, DC-based progressive think tank, “NAFTA had created a
speculative bubble for Mexican assets that then collapsed when the
speculators cashed in.”20
In NAFTA’s first year, 1994, one million Mexicans lost their jobs when the
peso was devalued. To avert a flood of capital to the north, then-U.S.
Treasury Secretary Robert Rubin engineered a $20 billion loan to Mexico,
which was paid to bondholders, mostly U.S. banks. In return, U.S. and
British banks gained control of the country’s financial system. Mexico had
to pledge its oil revenue to pay off foreign debt, making the country’s
primary source of income unavailable for the needs of its people.

As the Mexican economy, especially the border maquiladora industry, became
increasingly tied to the U.S. market, tens of thousands of Mexican workers
lost jobs when the market shrank during U.S. recessions in 2001 and 2008.
“It is the financial crashes and the economic disasters that drive people
to work for dollars in the U.S., to replace life savings, or just to earn
enough to keep their family at home together,” says Harvard historian John
*Immigrants, Migrants, or Displaced People?*

In the U.S. political debate, Veracruz’ uprooted coffee pickers or
unemployed workers from Mexico City are called immigrants, because that
debate doesn’t recognize their existence before they leave Mexico. It is
more accurate to call them migrants, and the process migration, since that
takes into account both people’s communities of origin and those where they
travel to find work.

But displacement is an unmentionable word in the Washington discourse. Not
one immigration proposal in Congress in the quarter century since IRCA was
passed has tried to come to grips with the policies that uprooted miners,
teachers, tree planters, and farmers. In fact, while debating bills to
criminalize undocumented migrants and set up huge guest worker programs,
four new trade agreements were introduced, each of which has caused more
displacement and more migration.
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