What Does NAFTA Do?
Kevin D. Williamson’s fulsome praise of NAFTA (“What NAFTA Does,” November 13) notwithstanding, the primary goal of NAFTA is to provide American manufacturers with unfettered access to low-cost Mexican labor. The “continental supply chain” engendered by NAFTA allows parts and subassemblies to be shipped to Mexico duty-free, where they can be assembled into finished products by workers making $2.50 per hour. This is the “Free Trade” part of the agreement; if tariffs were imposed on incoming or outgoing goods, the low-wage advantage would be negated and the manufacturers would set up shop elsewhere.
A handful of overproducing American farmers have benefited from NAFTA because, as the theory of comparative advantage would predict, Mexican farmers have been persuaded (i.e., forced) to give up their farmlands and become factory workers, thereby depriving Mexico of the ability to feed itself and making it necessary to import food. The value of the agricultural products the U.S. exports to Mexico pales in comparison with that of the manufactured products, which are essentially American, exported by Mexico to the U.S.