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PERSPECTIVE ON TRADE : Competitiveness Begins at Home : U.S.-Mexico integration will continue, NAFTA or not. Washington should be debating a domestic jobs policy.

June 27, 1993|ABRAHAM F. LOWENTHAL | Abraham F. Lowenthal is the director of the Center for International Studies at USC and was the founding director of the Inter-American Dialogue in Washington.

Most of the debate within the United States about the North American Free Trade Agreement has taken place between proponents and opponents who concur that the agreement will have major effects in both the United States and Mexico, but who disagree strongly about the nature of that impact.

Those who favor NAFTA usually suggest that it will expand trade, increase employment on both sides of the border, benefit American consumers, reward attractive leaders, lock in positive reforms in Mexico and induce needed adjustments in the United States--and even that it will contribute toward an opening of democracy in Mexico and better conditions for Mexican immigrants in the United States.

Skeptics typically assert that the proposed agreement will have grave consequences on both sides of the border: displacing workers and farmers, exploiting labor and restricting its rights, fouling the environment, legitimating what is portrayed as an authoritarian and corrupt Mexican oligarchy and serving transnational alliances of capital rather than working people.

Interestingly, these lines of argument on both sides took shape long before a NAFTA text actually existed and could be analyzed. Once the NAFTA text was negotiated and initialed and the U.S. election campaign ended, the debate has become increasingly shrill, mainly involving the ever-less-nuanced and balanced juxtaposition of arguments and counter-arguments. Successive positions have been presented by both sides with apparently growing conviction--about the great "sucking sound" of jobs heading south or about the need to rescue Mexican President Carlos Salinas de Gortari, about the principles of free trade or the urgent priority of labor standards and environmental protection. Some participants in the debate regard NAFTA as the vital keystone to America's strategy for regaining international competitiveness; others see it as a dangerous weakening of the U.S. economic role or a needless distraction from a "laser-beam" concentration on domestic concerns.

From Southern California, the content and tone of our national debate on NAFTA seem flawed.

First, anyone who thinks the question of economic relations with Mexico can be put aside while our country attends to its domestic agenda simply does not understand the blurring of the U.S.-Mexico border and how the line between domestic and international policy has been eroded as a result. When 65% of the students in the Los Angeles public schools are Latino, more than half of them speaking Spanish as their first language, education becomes an international policy question.

When more than half the babies born in Los Angeles County are Latino, public health has a decidedly international dimension. So do questions of jobs, public services, narcotics, environment, police-community relations and inter-ethnic tensions. Managing our national relations with Mexico and its effects is an unavoidable priority. It is a concern at the nexus between international and domestic concerns; it is a quintessentially "intermestic" challenge, as Bayless Manning put it 20 years ago.

Second, it makes no sense to discuss and debate NAFTA as if it were possible to choose whether to have close and intensifying connections with Mexico, or whether labor-intensive industries should move south. For more than a generation, there has been an accelerating process of economic, demographic and social integration between Mexico and the United States. This is particularly evident in Southern California, where the population of Mexican origin has doubled in the last 10 years.

Without a NAFTA or any bilateral accord, trade between Mexico and the United States has risen from less than $30 billion in 1985 to more than $75 billion in 1992. Without a NAFTA, an estimated 15,500 jobs moved from California firms to companies operating in Mexico in the late 1980s, and the pace has been increasing. Without a NAFTA, U.S. direct investment in Mexico grew by an estimated $8 billion in the past five years. It is rather late in the game to debate whether the United States and Mexico should be closely connected, or to think that the United States unilaterally can stem the flow of capital and jobs across the border.

The process of what Clark Reynolds of Stanford once perspicaciously called "silent integration" between Mexico and the United States has become vocal, indeed boisterous. It is no longer a matter of political will or state decision; people of all classes and sectors are building thickening connections. Although these connections raise some problems, they also present solutions to the concrete needs of migrants, employers, workers, investors and consumers. The U.S. debate should take this plain fact into account as a premise for policy, not denounce or ignore it.

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