Fact Sheet: NAFTA’s Legacy: Failed Trade Policy That Drove Millions From Their Homes
President Trump is scapegoating Latin American immigrants for the economic insecurity facing many Americans with his racist attacks on Mexicans and xenophobic obsession with building a wall along our southern border. But it is the same U.S. trade policies that harm working people in the United States that also have left many in Latin America with no options but migration as they struggle to feed and care for their families. The North American Free Trade Agreement (NAFTA) crushed small farmers in Mexico, displacing millions in rural communities. Pacts that followed, such as the Central America Free Trade Agreement (CAFTA) and Free Trade Agreements with Peru and Colombia, destroyed livelihoods and devastated communities throughout Latin America. Many of the immigrants Trump now attacks have experienced some of the worst damage caused by our current trade policy.
NAFTA was negotiated by the George H.W. Bush administration between the United States, Mexico and Canada, and passed by the Bill Clinton administration. NAFTA devastated Mexico’s rural economy and destroyed many small- and medium-sized businesses in Mexico. With millions of Mexicans displaced from rural communities competing for the hundreds of thousands of manufacturing jobs that relocated from the United States under NAFTA, many found no work. For many who did, wages remained low. These factors generated enormous pressures for working-age Mexicans to attempt the dangerous journey to the United States. In NAFTA’s first seven years, Mexican migration to the United States more than doubled, surging 108 percent.
The George W. Bush administration then negotiated an expansion of the failed NAFTA model with five Central American nations and the Dominican Republic called CAFTA. CAFTA’s proponents promised it would create economic opportunities, reduce gang- and drug-related violence in Central America and thus diminish the flow of migration to the United States. The opposite occurred. Rural communities were gutted as exports of subsidized U.S. agricultural products wiped out local farmers. The displaced sought short-lived apparel assembly jobs – many of which then vanished with production shifting to Vietnam and other countries. Gang- and drug-related violence in Central America has reached record highs, and forced migration from the region has surged. The waves of unaccompanied Central American children arriving at the U.S. southern border spotlighted the social and economic devastation of the region after a decade of CAFTA.