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Cicada

(4,533 posts)
7. NAFTA leveled the anti US tilt of the playing field
Sun May 13, 2018, 05:08 PM
May 2018

Pre NAFTA Mexico imposed average tariffs of 15% on US made goods while we imposed average tariffs of five percent on Goods made in Mexico. The playing field was tilted heavily against the US and NAFTA reduced the anti US tilt. And NAFTA included funds to compensate any US firms which was harmed by NAFTA. For instance there were US manufacturers of brooms protected before NAFTA which could no longer compete. People were surprised that the claims for compensation to damaged US firms were only a very tiny percentage of what was expected. But NAFTA could have been better. Dick Gephardt went batshit furious when he learned that we were unable to get into the law a provision that Mexico would have to raise their minimum wage in proportion to the increase in per capital Mexican GDP. Our NAFTA negotiator Mickey Kantor told Gephardt that he tried hard to get that provision in but that Mexico simply would not sign any agreement with that provision. People hated NAFTA but I always thought leveling the playing field of tariffs was good for us. Plus the number of jobs in both countries exploded upwards after the deal. But the labor ally Gephardt was bitter that we did not assure rising Mexican wages, the primary selling point for the deal. The argument was that Mexican wages would rise so their advantage competing against US workers would decline with time.

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