NAFTA: it's not just about trade! The North American Free Trade Agreement was intended from the beginning to be the foundational framework for a future North American Union.(SPECIAL REPORT: NAFTA)

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When President Bill Clinton pushed for congressional approval of the North American Free Trade Agreement (NAFTA) in 1993, he argued that the pact would create jobs for American workers--200,000 in the first two years alone. "NAFTA means jobs, American jobs and good-paying American jobs," Clinton assured us. "If I didn't believe that, I wouldn't support this agreement."

Regardless of what Clinton believed then, it is now clear that the promised jobs never materialized. In fact, exactly the opposite has been the case. According to a briefing paper published by the Economic Policy Institute in 2006, "In the United States workforce, NAFTA has contributed to the reduction of employment in high-wage, traded-goods industries, the growing inequality in wages, and the steadily declining demand for workers without a college education." That paper, written by EPI economist Robert E. Scott, said that our "growing trade deficits with Mexico and Canada have pushed more than 1 million workers out of higher-wage jobs and into lower-wage positions in non-trade related industries," and that "the displacement of 1 million jobs from traded to non-traded goods industries reduced wage payments to U.S. workers to $7.6 billion in 2004 alone." (Emphasis in original.)

Despite the economic devastation wrought by NAFTA, however, its promoters try to deny the obvious. At the North American leaders' summit in Montebello, Canada, last August, President George W. Bush, with his counterparts from Mexico and Canada at his side, claimed: "NAFTA, which has created a lot of political controversy in our respective countries, has yielded prosperity.... It's improved wages and a better lifestyle and more hope." Obviously, many displaced American workers know otherwise.

The Bush administration is working to expand and strengthen NAFTA, steps that would make the economic devastation even worse. For several years, the president recommended a trade agreement extending the NAFTA concept to all the countries of North and South America, except for Cuba. As he put it in 2003: "We seek to build on the success of NAFTA with the Free Trade Area of the Americas." His FTAA proposal has stalled, but he was able to ramrod the Central American Free Trade Agreement (CAFTA) through Congress in 2005, extending the NAFTA concept to the nations of Central America. And through the Security and Prosperity Partnership (SPP), his administration is working to build NAFTA into a North American Union.

NAFTA was supposed to create jobs and prosperity through "free trade," just as the name of the agreement indicates. But NAFTA was never about establishing genuine free trade, which would entail virtually unregulated exchange of goods across borders. NAFTA was based on regulated trade, with our trade policy no longer shaped by Congress but by the new transnational regulatory bureaucracy NAFTA created.

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