Corporate Consolidation, from Argentina to Alaska

The latest free trade deal endangers workers? rights, the environment, and democracy throughout the hemisphere


| July/August 2001


Despite what you may have heard in the major media, NAFTA (the North American Free Trade Agreement) has worsened conditions for Mexican workers. These children outside Tijuana are in a church daycare program much of the day and night because their parents work long hours at foreign-owned factories. Many other children are home alone for long stretches of time.

If you missed media coverage of the Summit of the Americas in Quebec City last April, you’re not alone. The massive protests outside the meeting of 34 heads of state—every country in the Western hemisphere except Cuba—flashed across the headlines for a few days, then vanished. But the issues the demonstrators were protesting have not gone away.

The Summit’s official Web site billed it as a chance for leaders to 'address common hemispheric issues and challenges,' including 'improved access to education, poverty alleviation, strengthening human rights and democracy, and economic integration.' In reality, it was an elaborate kickoff party for a new round of negotiations aimed at creating a Free Trade Area of the Americas (FTAA), a deal that would extend the dubious 'benefits' of NAFTA—the North American Free Trade Agreement—from Alaska to Argentina.

In the seven years since the United States, Canada, and Mexico signed NAFTA, investors and financiers in all three countries have enjoyed huge success as trade and investment ballooned. Yet NAFTA’s promise of 'a rising tide that lifts all boats' has left workers and the environment high and dry.

An Economic Policy Institute survey of NAFTA’s impact on labor 'finds a continent-wide pattern of stagnant worker incomes, lost job opportunities, increased insecurity, and rising inequality.' Meanwhile, pollution in all three countries has continued to rise, particularly in the maquiladora factories along the U.S.– Mexico border. And numerous environmental, food safety, occupational health, and consumer standards—which were supposedly protected under NAFTA’s labor and environmental side accords—have been struck down as unfair barriers to free trade by panels of trade judges operating behind closed doors. For example, in 1997 Canada banned the use of MMT, an octane-boosting gasoline additive that was found to be a human neurotoxin. Virginia-based Ethyl Corporation, the world’s sole manufacturer of MMT, sued the Canadian government for $250 million under NAFTA’s 'investor protection' provisions. In 1998 the case was settled for $13 million and the ban was reversed.

The FTAA takes things from bad to worse. In a report for the International Forum on Globalization, Canadian activist Maude Barlow argues that the FTAA 'goes far beyond NAFTA in its scope and power . . . to create a trade powerhouse with sweeping new authority over every aspect of life in Canada, the Americas, and the Caribbean.'