By Spencer P. Morrison:
In 1993, President Bill Clinton promised that the North American Free Trade Agreement (NAFTA) would create “a million [American] jobs in the first five years.” He also said NAFTA’s “side agreements” would “make it harder than it is today for businesses to relocate solely because of very low [Mexican] wages or lax environmental laws.”
Bill Clinton lied.
More than 800,000 American manufacturing jobs moved to Mexico since 1993, “solely because of very low [Mexican] wages or lax environmental laws.” Not only was Clinton wrong, NAFTA also caused numerous unintended harms: the post-NAFTA unemployment wave is largely to blame for the proliferation of Democratic governments in Midwest—a former GOP stronghold, I might add—wage stagnation, the opioid crisis, and general economic malaise.
President Trump is right: NAFTA is one of the “worst” deals in American history. And yet, the President’s replacement deal is little better. Although Trump’s deal mitigates NAFTA’s downsides, it fails to address the underlying problem: asymmetrical competition.
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