Hello!
I thought with our rushed conversation towards the end of class yesterday that I could add a bit more of my own insight to the US and Mexico relationship with Maize. I wrote a paper on the topic a month before NAFTA became USMCA in 2018. Its short and not super thorough but a good quick read for folks who want a quick context of how neoliberal free markets resulted in food insecurity for Mexico.
The sources used for this are also good context points for further research especially Duncan Green.
-Grey
side note: this was my first paper after 10 years off from college haha so some of the terms used are not the best.
Loss of Security:
The Impacts of NAFTA on The Mexican People
On January 1st, 1994 the North American Free Trade Agreement (NAFTA) was signed into action. Hidden between the lines of this monumental document were the lives of the Mexican people who stood to suffer the most for lack of representation. More important than their labour, equality or human rights were the interests of transnational corporations. During the years 1982 to 1993, Mexico saw a decline in economic growth and job creation as a result of neoliberal policies such as reducing the role of state and depreciating the currency. This led to Mexico joining the negotiations of NAFTA. Pressure from the United States combined with their use of neoliberal policies such as privatization, trade liberalization of commodities, and devaluing currency influenced the Mexican government to succumb to unequal regulations that would impact Mexican people the most. As they had already witnessed how neoliberalism caused a decline in the economy previously, many of the Mexican people did not support such a trade agreement (Nápoles 76). After the signing of NAFTA, labour regulations changed dramatically forcing many families to work in the mostly foreign owned maquiladoras or in the informal sector. Additionally, the import liberalization on important commodities, specifically maize, jeopardized food security and accessibility. Because of neoliberal policies advanced within NAFTA, Mexico entered a social crisis resulting in negative impacts on food and job security.
The signing of NAFTA promised an economic boom with a focus on a free market, more exports and mutual interest in international trade. The trade agreement aligned Mexico, Canada and the United States in order to establish a stronger America. Unfortunately for Mexico, NAFTA is plagued with political and economic inequality. According to author Duncan Green in his book Silent Revolution, “the disparities within NAFTA are stark. The U.S. economy is almost twenty-five times larger than Mexico’s and the social and developmental gulf is arguably even wider” (143). This fact illustrates the unequal playing field between Mexico and the United States. Richer market economies, like the U.S., can afford fluctuating market prices while poorer countries suffer in comparison. Smaller economies focus on a few commodities and stand to lose the most if that commodity is liberalized. The ideology of neoliberalism obscures the inequities and hardships experienced by Mexico. As Duncan outlines, “neoliberals argue that liberalizing imports improves economic efficiency and benefits everyone. Local factories can import the best available machinery and other inputs to improve productivity, while consumers can shop around, rather than be forced to buy shoddy home-produced goods” (Duncan, “Silent” 135). While theoretically plausible, in practice it often offers an unfair playing field by flooding the market with cheap imports that undercut local economies. For Mexico, maize is such a commodity.
Traditionally, Mexico was the largest producer of maize with a long history of domestication and cultivation expending thousands of years. In the early 1990s, maize production in Mexico employed roughly three million people accounting for the livelihood of over 18 million people (Nadal and Wise 4). Additionally, maize is an important and basic food staple for the Mexican people. The liberalization of maize pinned Mexico against the U.S. in the fight to be the lead agro-exporter. Mexico unfortunately lost ground in the agricultural sector as maize no longer succeeded in out-producing U.S. in prices. Maize was included late in the negotiations of NAFTA, as concern grew heavy for Mexico to liberalize one of their primary crops. The settled agreement offered a 15-year phase in period for gradually increasing exports while gradually decreasing trade tariffs (Nadal and Wise 5). The goal was to allow a slow transition period for Mexico to introduce competition into the market they dominated while not crippling their export dependency. Unfortunately for the farmers of Mexico, the Mexican government declined this agreement within thirty months claiming production shortfalls and outside pressures including other government institutions and grain processors within the United States and Mexico (Duncan, “Silent” 147). Beginning in 1996, U.S. exports of maize to Mexico increased dramatically, tripling in quantity from 1.6 million tons pre-NAFTA to 6.3 million tons post-NAFTA (Nadal and Wise 5). Also, prices had fallen by 48 percent that same year (Duncan, “Silent” 147). Mexico began to depend on cheaper U.S. maize for consumption with imports rising from 8.9% to 21.3% after NAFTA (Nadal and Wise 6). Additionally, the quality of U.S. yellow maize was inferior to Mexican white maize as most of the U.S. crop was genetically modified. This led to a dependency on cheaper, less nutritional food causing a severe devaluation of food security. In addition to the impact on food security, the hike in exports to Mexico caused severe environmental damage, which included “agrochemical impacts resulting from fertilizers, herbicides, and pesticides; introduction of genetically modified organisms; soil erosion; and biodiversity” (Nadal and Wise 8).
Mexican farmers were hit the most by other adjustment measures like cut state subsidies, and the abolition of state purchasing and supply agencies (Duncan, “Silent” 147). The fall in prices and exports for the Mexican maize farmers did not lead to a decline in maize production however. Many small farmers continued to cultivate their crop through the unbalanced market but had to make adjustments to their daily lives. Most farmers were no longer able to turn a large profit but were able to make ends meet by supplementing their income. Farmers’ family members, mostly women and children, were sent to work in the labor-intensive maquiladoras, while the rest joined the informal sector selling goods on the street or offering services (Duncan, “Silent” 159). Many farmers even sent their family members to the United States leading to an increased dependency on emigration (Nápoles 76). In 1995, over 400,000 Mexicans crossed the border into the United States for better opportunities (Nápoles 85). While many of the farmers survived the change of market, the adjustments made were instrumental to the destruction of their family structure and offered no long-term solutions. Women were forced to work multiple jobs with long hours which impacted their community and home life, while many men turned to alcohol, drugs and violence in the wake of lost jobs and wages (Duncan, “Face” 87-9). Self-sufficiency in the agricultural development of maize became scarce as a sole income generator for a family and access to food decreased as costs went up. According to author Gerardo Otero, “the invasion of U.S. grain has led to the bankruptcy of a huge number of Mexican peasants, whereas the increase in vegetables and fruit exports from Mexico has not been enough to generate employment for peasants that became redundant” (391). Most importantly, because of the liberalization of maize, the cost of tortillas, a staple food item typically eaten at every meal, increased in price for local consumption. Consequently, the liberalization of maize simultaneously impacted Mexican farmers in multiple ways; it contributed to malnutrition, family breakdown and exploitation of labour.
Another crucial impact to the Mexican people that jeopardized their security was the introduction of foreign interest into the labour-intensive industrial market that shaped policies to favour international interest over Mexico’s interest. One key change as a result of NAFTA’s loosening labour regulations was the rise of maquiladoras along the Mexican border. With the new lax labour, safety, and environmental laws, foreign companies flocked to Mexico to set up shop with their offer of abundant cheap labour. According to Green, “locking in neoliberal reforms via NAFTA makes Mexico a far safer prospect for foreign investors deciding where to locate their factories” (Green, “Silent” 146). Transnational companies built factories within the free trade zone for cheap products and paid no duty on imported parts, most of which were exported back to the United States free from taxes. When prices got too high, these foreign direct investors would relocate to countries with cheaper labour. According to Green “the 40 percent devaluation of the Mexican peso in early 1995 provided another boom for the maquiladoras” (“Silent” 129). Optimistically, the influx of foreign investment yielded more jobs for the impoverished Mexican people as employment grew by 3.7 percent per year during the 1990s as exports increased. Though the increase in jobs offered many unemployed Mexicans a chance at generating wages, they were misled into the quality of their work assignments and the promise of job security faded (Green, “Silent” 131).
As the fall in wages attracted foreign investors, the livelihood of the Mexican workers in the maquiladoras was dramatically impacted. As presented in the film ‘Maquila: A Tale of Two Mexicos’ the treatment of the workers in Mexican maquiladoras violated basic human rights. They were treated poorly, harassed by supervisors, not offered proper security to work efficiently without injury, and women were subject to inappropriate pregnancy checks. In Faces of Latin America Green adds that women are most impacted by these conditions as they are met with conflict and violence. Women, mostly aged 16-25, are more likely to work in such conditions in an attempt to provide for their family (Moffatt 19). Journalist Allison Moffatt also writes, “the factories share high standards for quality and low standards for the treatment of employees” (19). The employers of the factories take advantage of the women by only offering part-time work for lower wages; further, they were not offered labour contracts, which increased the instability of their family structure (“Faces” 53). Women workers were also terrorized by their male supervisors who verbally abused them, restricted bathroom breaks and assaulted them while commuting to work as recounted in ‘Maquila: A Tale of Two Mexicos’. In Cuidad Juarez, a city riddled with maquiladoras, there have been hundreds of murders inflicted on the women working in this industry since the 1990s (Moffatt 20). These are just a few accounts of the horrific treatment Mexican people are met with while working under the umbrella of NAFTA. These companies operated under the guise of NAFTA with no global monitoring of their violations to the Mexican people. The workers are victimized yet have no other options but to endure such treatment as their families and job security are at risk.
The impact of globalization and promise of free trade continues to exploit the lands and people of Mexico. While NAFTA was promoted on a platform of economic boosts and equality between nations, Mexico was dealt a blow to their self-sufficiency and labour sovereignty. The issues surrounding the liberalization of maize and the rise of maquiladoras are two examples that illustrate the social, economic and political harms of NAFTA and the spread of neoliberalism. Nearly 25 years later, the same neoliberal tactics are still being used to victimize smaller economies and markets across Latin America. Mexico has continued to suffer at the hands of foreign companies who were invited into their lands. The social debt built on the backs of underrepresented Mexicans, largely indigenous, requires reparations into the damage left because of NAFTA. Like most issues involving Latin American, it is complicated.
Works Cited
Green, Duncan. Silent Revolution: The Rise and Crisis of Market Economics in Latin
America. 2nd ed., Monthly Review Press, 2003
Green, Duncan. Faces of Latin America. 4th ed., Monthly Review Press, 2013.
Maquila: A Tale of Two Mexicos. Directed by Saul Landau and Sonia Angulo, United
States, 2003
Moffatt, Allison. “Murder, Mystery and Mistreatment in Mexican Maquiladoras: It Is
Never Too Late to Make a Difference.” Women & Environments International Magazine, no. 66–67, 2005, p. 19. EBSCOhost,login.ezproxy.langara.bc.ca/
login?url=https://search-ebscohostcom.ezproxy.langara.bc.ca/login.aspx? direct=true&db=edscpi&AN=edscpi.A133172912&site=eds-live&scope=site.
Nadal, Alejandro and Timothy A. Wise. “The Environmental Costs of Agricultural
Trade Liberalization: Mexico-U.S. Maize Trade Under NAFTA.” Working Group on Development and Environment in the Americas. June 2004. https://ase.tufts.edu/gdae/Pubs/rp/DP04NadalWiseJuly04.pdf. Accessed 4 Nov. 2018
Nápoles, Pablo Ruiz. “Neoliberal Reforms and Nafta in Mexico.” Economía UNAM,
Vol. 14, May 2017, pp. 75–89. EBSCOhost, doi:10.1016/j.eunam.2017.06.004.
Otero, Gerardo. “Neoliberal Globalization, NAFTA, and Migration: Mexico’s Loss of
Food and Labour Sovereignty.” Journal of Poverty, 15:4, pp. 384-402. JSTOR,
https://doi.org/10.1080/10875549.2011.614514. Accessed 8 Nov. 2018