By Rebecca Van Horn, Program Coordinator, USLEAP
As the number of undocumented Mexican immigrants in the United States nears 12 million and xenophobia continues to drive state and federal policy, it is time to take an honest look at the effects of the North American Free Trade Agreement (NAFTA) on worker rights and immigration. The agreement has liberalized the markets while clamping down on the movement of labor, and the one trade-based mechanism designed to hold participating countries accountable for worker rights violations, the North American Agreement on Labor Cooperation (NAALC), has become almost obsolete. The result: labor rights violations abound, an immigration system remains broken, and the link between the welfare of workers abroad and workers at home goes unexamined.
NAFTA and NAALC
On January 1, 1994, Mexico, the United States and Canada implemented the North American Free Trade Agreement (NAFTA), an accord that removed all non-tariff barriers to trade and agreed to phase out tariffs over a period of 15 years, lifting many restrictions on foreign investment. The same day, the North American Agreement on Labor Cooperation (NAALC), the “side agreement” of NAFTA designed to protect worker rights, also went into effect.
In NAALC, each NAFTA signatory must enforce its own domestic labor laws, not the standards established by the International Labor Organization (ILO) conventions, while promoting 11 worker rights practices over the long term. There is no penalty for decreasing domestic labor rights protections, like the U.S. and Mexico are currently trying to do. If a labor rights complaint is accepted by the appropriate institution, the National Administration Offices (NAO) in Mexico and Canada or the Department of Labor’s Office of Trade and Labor Affairs (OTLA) in the U.S., violations of minimum wage, child labor, and occupational safety and health standards can theoretically result in sanctions, and violations of freedom of association and the rights to organize, bargain collectively, and strike can end in ministerial consultations.
The inclusion of NAALC in NAFTA marked the first time an international trade agreement recognized labor standards as a part of trade liberalization. But to date there is no evidence that NAALC deters businesses from committing labor rights violations or encourages governments to hold violators accountable. The process has become almost obsolete. Between 1994 and 2006, there were 38 complaints filed under NAALC: 2 against Canada, 11 against the U.S., and 24 against Mexico. Thirty-two of the 38 complaints completed all the levels of evaluation for which they were eligible, although only 22 out of the 38 were accepted for review. No cases have been accepted since 2005, and only 2 out of 7 were accepted between 2001 and 2005. From 2006 to 2009, no complaints were filed, and only one was accepted in 2010, against Mexico. Although there have been 7 Ministerial Agreements reached between the U.S. and Mexico in regards to 12 separate petitions, no case has ever passed beyond ministerial consultations.
The decline in petitions filed under NAALC can mean two things: either governments are holding companies accountable for committing labor abuse violations without external encouragement, or unions and civil society groups do not think that the process is effective or strategic. The latter seems more likely. The NAALC petition procedure is a long, bureaucratic process that is ultimately unable to sanction companies directly. Because workers must file a complaint in a different country than the one in which the violation occurred, an effective NAALC complaint requires unions and civil society groups to work together across borders, a positive step for international solidarity but one that involves an investment of time and resources. The NAALC process has all but stalled while the far-reaching effects of privatization and market liberalization have continued to affect both sides of the border.
NAFTA and Immigration
Although it is difficult to map a conclusive cause-and-effect link between NAFTA and immigration due to the quantity of economic and social factors involved, the numbers indicate a correlation: between 1990 and 2000, Mexican immigration to the U.S. more than doubled, the majority arriving after NAFTA’s implementation and the devaluation of the peso in 1994 and 1995. As cheap, subsidized U.S. corn goods flooded Mexican markets, millions of rural farmers in Mexico were forced to migrate to urban areas or abroad. Mexican workers watched the purchasing power of their income drop 50% over the last two decades, while privatization, among other factors, led to a marked drop in unionization. Thirty years ago, 75% of the Mexican workforce was unionized. Today, that number is 30%, mostly due to state-based jobs; the state-owned oil company PEMEX has a 72% rate of unionization while the privatized petrochemical industry has a rate of 7%.
The combination of family farms shutting down and unionization and purchasing power decreasing contributed to the rise in Mexican immigration, and with it the number of undocumented persons. In 1993, the year before NAFTA went into effect, approximately 3.9 million undocumented Mexican immigrants lived in the U.S. In 2009, there were 11.1 million, an increase of almost 300%. In spite of the connection between U.S. policy and the rise in immigration and geographic proximity, the road to citizenship is not an easy one: Mexico has the same immigrant quota as Nepal and Botswana.
Here emerges a central paradox. As Patricia Fernández-Kelly and Douglas Massey highlight in the article “Borders for Whom? The Role of NAFTA in Mexico-U.S. Migration”, NAFTA has liberalized economic borders while tightening control over the movement of labor; workers are forced to stay in their own country even as the border opens to the movement of capital. Policies have become more protective of investor rights than worker rights, and the U.S. has militarized the border with one of its closest trade partners.
Unsurprisingly, U.S. attempts to tighten the reigns on immigration have proven both ineffective and counterproductive. As border security has increased, so has the sophistication of border smuggling services and the need to stay in the U.S. It now costs more than $2,800 per person to travel across the border, and while fifteen years ago it was common for Mexican men to go to the United States, earn money and then return to their families, it is now more cost effective to stay in the U.S. and bring their families to them. The rise and fall flow of male workers has turned into the transplant of whole families, resulting in a sharp spike in the number of undocumented immigrants. In 1996, 45% of Mexican workers went home; in 2010, only 25% returned.
Worker Rights Abroad, Worker Rights at Home
The limitations of NAALC and the treatment of immigration as a national security issue as opposed to labor regulation have resulted in xenophobia and worker rights abuses. A 2004 Associated Press investigation revealed that at least one Mexican worker dies each day in the United States due to unsafe working conditions. In southern and western states, Mexican workers are four times more likely to die on the job than U.S.-born workers.
And yet, Mexican immigrants continue to come to the U.S., and U.S. companies continue to relocate jobs to Mexico. Workers on both sides of the border lose. In 2004, the average factory worker in the U.S. made $18 per hour, while in Mexico s/he earned $3. While Mexican workers go to the U.S. in search of a better life, factories move or threaten to move to Mexico, particularly when faced with labor rights violation complaints. A Cornell University study of more than 400 union certification campaigns in the U.S. revealed that 68% of companies have threatened to close U.S. plants in response to union activity, and 18% threatened to move to another country, typically Mexico. Labor rights campaigns were significantly less successful when companies threatened to move: 38% compared to 51%.
What we see are the effects of a trade agreement that promotes market interaction while tossing aside those most affected. Without acknowledging the effects of NAFTA, opening the border to the movement of people affected by trade, and replacing the current trade model with one capable of raising labor standards for both countries and ensuring their enforcement, U.S. companies are going to continue to relocate to Mexico, and Mexicans are going to continue to move to the U.S. And at the end of the day, we will continue to run circles around ourselves, putting out the fire with a can of gasoline.