Trading Away Prosperity

Gary Hufbauer, a senior analyst at the Institute for International Economics, a Washington research group that supports free trade, said the gains for the United States — lower priced consumer goods and increased corporate earnings — are large compared to the losses.

"However, the gains are so thinly spread across the country that people don't thank Nafta when they buy a mango or inexpensive auto parts," he said.

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"We're the losers," said Bonnie Long, one of at least half a million American manufacturing workers who lost their jobs due to Nafta, despite the surge in trade. "We lost our health care, our living wages. The winners are the corporate executives who don't even live here and can locate their factories wherever they find the cheapest labor."

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After five years, Ms. Vázquez takes home $45 for a 48-hour week, after deductions for the costs of her government-built house. Though her income is higher than it was back home, what she has left after paying the bills is about the same. "Life is different," she said, "but just as hard."

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But by every measurable standard, the gap between rich and poor in Mexico widened. Unemployment is up and real wages, eroded by a collapse of the peso in 1995, are flat or down for many millions of workers.

Many of these maquiladora jobs are now disappearing, as the one relative advantage Mexico once had — cheap labor — erodes in an expanding global marketplace. Of the 700,000 new maquiladora jobs generated in Nafta's first seven years, 300,000 have been eliminated since 2000.

But in Canada, as in Europe, the social safety net eased that transformation. The European Union handled free trade differently. It has allowed the free movement of workers, not just capital. It protected wage standards. It closed the gap between a richer country like Germany and a poorer one like Greece with money and technology. European governments, not employers, provide health care and pensions.

"It is easier when people don't have to worry about the social safety networks and can accept a connection between improving competition and economic growth," said Pascal Lamy, Europe's top trade minister and a staunch free trader. When Americans are thrown out of work because of a fundamental shift caused by new global trade rules, he said, they risk losing everything.

"According to the December 16, 1998 issue of Mexican Labor News and Analysis, in 1987 a worker had to work 8 hours and 47 minutes to buy the basic food basket for a family of four. Today it takes 34 hours."

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"In December 1998, the Mexican government increased the minimum wage by 14%. However, government figures show that the consumer price index rose 18.6% in 1998. Mexican government statistics show that real wages have dropped to a 30-year low and are likely to sink even further as the 1999 budget takes effect."

THE TEN YEAR TRACK RECORD OF THE NORTH AMERICAN FREE TRADE AGREEMENT U.S. WORKERS’ JOBS, WAGES AND ECONOMIC SECURITY

"The face of poverty is a working woman with two children," said Robert Egger, the founder of D.C. Central Kitchen and an advocate for rethinking what goes into a charity food basket.