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Oct. 27th, 2009 11:52 pm![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png)
Mexico's Union Bust Reveals Flaws in NAFTA
The Mexican economy is at a crossroads as it faces a multi-billion dollar deficit this year. Due to its heavy dependency on the U.S. economy under NAFTA, it is the hardest-hit country in Latin America and predicts a 7.5% drop in gross domestic product (GDP) for 2009. The number of poor has increased above pre-NAFTA levels, leaving millions more families in poverty, while the unemployment rate has doubled.
The congressional leader of Calderon's National Action Party, Mario Alberto Becerra, estimated that even after doling out severance pay, the government will save money through the reduced costs of operating Central Light. The government plans to use some of that money for hand-out programs for the poor, a model it considers preferable to maintaining unionized workers in jobs. Treasury Secretary Agustin Carstens announced that the 42,000 SME workers will be replaced with 10,000 new hires. He didn't say any would be hired back; the message was clear—union members need not apply.
Obama promised a renegotiation of NAFTA to incorporate the toothless labor side agreement into the text and integrate core International Labor Organization principles in defense of workers' rights. At the recent Summit of North American Leaders he said that the promise has been placed on the back burner. But that burner seems to be turned off. At an October 19 meeting between trade representatives of the three NAFTA nations, they reaffirmed their commitment to the trade agreement with no mention of renegotiation.
Unionized workers are not the only ones who suffer. NAFTA has displaced some two million Mexican small farmers in the countryside due to competition with U.S. agricultural imports. A recent ruling of a NAFTA tribunal delivered a record ruling of $77.3 million to Cargill Incorporated to compensate the company for a government program that blocked the use of corn syrup to save Mexico's sugar industry—an industry heavily protected in the United States. NAFTA's investment provisions (known as "Chapter 11") allow corporations to sue governments under special tribunals as one of the many privileges offered transnational corporations under the agreement. This obscene ruling to one of the world's wealthiest agro-businesses illustrates the priorities of NAFTA and the constant erosion of worker's rights and livelihoods.MORE