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Goals

Goals. Empathize with the human face behind the immigration “issue.” Understand the North American Free Trade Agreement and its effects on the US’ immigration problem. NAFTA and Immigration. Mexican Economy Before NAFTA. Post WW2, Mexican economy was booming

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Goals

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  1. Goals • Empathize with the human face behind the immigration “issue.” • Understand the North American Free Trade Agreement and its effects on the US’ immigration problem

  2. NAFTA and Immigration

  3. Mexican Economy Before NAFTA • Post WW2, Mexican economy was booming • On the verge of joining 1st world. • Large petroleum exporter • In 1970s, the price on petroleum sky-rocketed, giving Mexico a huge income. • Income led to credit with the IMF, so they borrowed a ton of money for infrastructure projects (many of which were mis-managed).

  4. Mexican Economy Before NAFTA • As petroleum costs continued to go up, inflation continued to rise • In order to counteract inflation, the World Bank began to enforce a strict monetary policy • The prime interest rate for loans nearly doubled. • Suddenly, Mexico owed too much interest than was feasible.

  5. NAFTA • North American Free Trade Agreement • Tri-lateral trade deal between USA, Canada, and Mexico • Eliminated tariffs on goods between US and Mexico • Eliminated taxes on cross-border investors • Initially signed by George H. W. Bush • Bill Clinton took office before Congress could ratify it. • So it was ratified and signed in January, 1994

  6. NAFTA’s Effects on Mexico • Since 1994, US agricultural exports to Mexico have doubled. • The US now supplies about 75% of all Mexican agricultural products • This devastated the southern, rural region of Mexico • Caused emigration from rural Mexico

  7. NAFTA’s Effects on Mexico • Mexican economy has grown since 1994 • However, it has grown more slowly than the global average • Poverty has dropped consistently since then, as well. • But unemployment has risen slightly • Proponents say that cheaper agricultural goods cause more spendable wealth (Mexican GDP has grown) • Opponents say that, while NAFTA created more Mexican jobs, it creates an economy that is overly dependent on the USA • Most of the profit from factories goes back to USA

  8. NAFTA’s Effects on the US • Deindustrialization • Job relocation, but overall job growth • States like Michigan, Ohio, Indiana, Pennsylvania, and California • Most manufacturing labor jobs relocated to service sector, where the pay is 4/5 of that of union manufacturing • Proponents say that cheaper goods have created more wealth and a better economy • Opponents say that this growth has disproportionately benefited the rich. • CBO says that economic growth due to NAFTA in US has been minimal

  9. NAFTA’s Effects on Migration • Mass emigration from rural Mexican areas to urban Mexican areas (particularly border towns). • Significant growth in unskilled labor jobs in Mexican border towns (maquilas) • Poor working conditions, long hours, poor wages at Mexican maquilas • Significant growth in agricultural jobs in USA • Growing rate of education, slowing birthrate have created less demand for unskilled labor positions among US native-born population (agriculture, manufacturing, construction, recreation, hospitality) • So who works those jobs?

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