Thread: NAFTA: Is it working for you?

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Sterling, IL. - John David reports
NAFTA: Is it working for you?
Feb 6, 2006, 07:47 AM PST
By John David

STERLING, Illinois -- A dark, dismal day in Sterling, Il., sets the mood for the end of an era. Inside the 93-year-old Lawrence Hardware plant, this work represents the last of the line. That's where you'll find Rita Clifton. After 21 years at the company, losing her job to cheaper foreign competition.

"We knew it was coming because the economy all over is going that way," she said.

Lawrence Hardware endured bankruptcy and a depleted workforce in recent years. The company just couldn't recapture its glory days on an uneven playing field.

"We start out at a 22% disadvantage," said Jim Franson, general manager.

Global pressures and trade policies like NAFTA spelled the end of production.

"There's EPA regulations, OSHA regulations that we have to conform to and cost us money that foreign sources don't have to deal with right now," he said.

For many American workers, NAFTA represents lost promises and bitter reality. Free trade with Canada and Mexico that reflects a global economy -- cutting careers and creating hardship along the way.

Enacting NAFTA nearly a dozen years ago, both conservative and liberal supporters projected it would create hundreds of thousands of American jobs. But there was one voice in the wilderness, and it belongs to Ross Perot.

"We've got a little song," he told CNN's Larry King. "We'll remember in November when we get into that little booth."

Just mention Perot, and Alan Nelson launches into a dead-on impersonation.

"Let me tell you what's going to happen with these NAFTA laws, folks," he drawled. "You're going to hear nothing but a giant sucking sound. You know what that sound is? That's the sound of your jobs going to Mexico."

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Rock Island, IL - John David reports
NAFTA: Is it working for you? -- Part Two
Feb 6, 2006, 02:34 PM PST

By John David

Inside the QCCA Expo Center in Rock Island, farmers come to see the latest in agricultural equipment. They check out the newest styles and creative ways to improve production. But just start asking the ag community about NAFTA, and you'll get a variety of opinions.

"It's been a good deal for some and not for others," said Jerry Boldt, Davenport. "For every person who thinks it's a good thing, you hear somebody complaining."

"I don't really like it," added Justin Gillespie, Toulon. "I'm not a big supporter of it."

"In the long run, I think maybe it will be good for us," said William Looney, Calamus.

Supporters like the American Farm Bureau report that NAFTA is adding value to agriculture. U.S. farm exports to Canada and Mexico jumped 93% after the signing. And U.S. exports reached a record high with both countries in 2004. That's good news for some farmers and agribusinesses.

"For agriculture, free trade is just critical to us," said Wendell Shauman.

Shauman is a Warren County farmer and a district director for the Illinois Corn Marketing Board.

"We're the world's largest producer of corn," he said. "We need markets. Our production is going up every year."

"Did NAFTA help the customer?" questioned Ken Golden, Deere and Company. "And it has."

Agribusiness giant Deere and Company supports free trade. With NAFTA opening up Canada and Mesico, it enhances the two biggest export markets for ag products.

"It's important for John Deere because we are more capable of moving components and manufacturing among the three countries," Golden said.

From his daily broadcast at WRAM in Monmouth, Tom Peterson spends a lot of time talking about free trade. He's been the farm director at WRAM during the entire NAFTA era.

"Agriculture-wise, it's been a win-win situation," he said.

Peterson points to NAFTA as a catalyst for growth in the ag community. It's a community that knows a lot about tough times.

"Trade is really the life blood of agriculture," he continued. "Compared to the rest of our economy, agriculture is twice as reliant on our overseas markets right now."

These are busy days for Lincoln Land Rail in Galva. Up to 150 truckloads arrive each day. The grain fills 110 cars spread out over a mile and a half of tracks. While most of the grain will travel to Texas, about 10% will cross the border into Mexico under NAFTA.

"I guess the first thing that comes to mind is restrictions," said Mike Rumbold, Lincoln Land Rail.

While train managers support NAFTA for its international opportunities, they say that free trade comes with a price. Miscellaneous expenses that cut into the bottom line.

"Federal inspectors cost money," he said. "That's one. We have to seal the top and bottom of every car. That's additional labor to do that."

And at the University of Texas Pan-American, research shows that NAFTA is overrated when it comes to growing the economy south of the border.

"In many ways, NAFTA actually created an additional bureaucracy that can actually create bureaucratic costs and slow things down," said Dr. John Sargent.

Critics say that at least 1.5 million Mexican farm jobs have been lost to NAFTA so far. That's led to a massive influx of small scale farmers from rural to urban areas in search of factory jobs.

"It's really leaving a lot of people behind," said Dr. Chad Broughton. "A lot of people are suffering as a result."

Broughton studies the extensive changes in Mexico under NAFTA.

"This is due to two things," he said. "One, the pull effect of job opportunities in Reynosa. Then, the push effect of the lack of opportunity in the rural areas."

"When we got to Reynosa, we didn't have anything," said Diego.

While researching in Reynosa during December 2004, we met Diego and his family. They are part of the influx of rural Mexicans who were driven off the land by international competition.

"Before it was very difficult to make a living as a small scale farmer in Mexico," Broughton said. "Now, it's virtually impossible because they're competing against giant American companies."

That doesn't sit well with Wendell Shauman. He disputes the serious displacement of the rural Mexicans.

"Mexico actually has the rights to put a tariff on, and they have not done so," Shauman said. "If they were hurting their farmers, they would be putting that tariff on."

As members of the ag community make the rounds at the farm show in Rock Island, it's clear that NAFTA will continue to be a topic of conversation and diverse opinions.

"The family farm where you had the chickens, the hogs and the cattle is basically gone," said Looney.

"It's opened up markets, and that's what we need," added Boldt.

"I think it's here to stay," concluded Todd Kunau, DeWitt.

NAFTA staying in Illinois and Iowa fields as farmers contend with this global economy.