Monday, September 10, 2012
NAFTA, 20 Years Later, part II
A look at the impact of NAFTA after 20 years.
PHOENIX “Let me tell you a story first.”
The story of Omar -- he asked that we only use his first name -- starts with the story of his father, Armando, who moved from a little pueblo in Michoacán, Mexico to Ciudad Obregón in Sonora in 1977, with only a third-grade education but determined to make it.
“He didn’t know nothing about the business,” Omar said. Specifically, Armando didn’t know anything about the catering business, which he decided to get into after reading in the paper that a new auto-parts manufacturer was looking for a company to cook meals for their employees. “But he was like, ‘I can do it. I can handle it.’"
Armando borrowed money from a few friends to buy an industrial kitchen, and built the business to the point where he could buy a house for his family in cash. This is the Mexico Omar was raised to believe in -- a country where success and mobility depended on local contacts and a lot of hard work.
This was the 1980s. Fast forward to 1992, when things dramatically changed for Omar’s family and small business people and farmers all over Mexico.
This is the year the then president of Mexico, Carlos Salinas, signed the North American Free Trade Agreement, thereby lifting the tariffs that had long been on U.S. commodities like wheat and corn, making them very cheap in Mexico. The local suppliers Armando had relied on for years struggled to compete, and so Armando struggled as well. The managers at the manufacturing plant told Armando to cut costs, or they’d find a new company to cook for them.
“None of the suppliers wanted to go down,” Omar said. “The people who sell the meat, the eggs -- they were actually complaining of the prices going up, because after the NAFTA was signed there were products that were no longer available or products that were imported from other parts of the world, through the United States, that destroyed the local market.”
Armando couldn’t make it -- the company went into terrible debt, and a more industrialized food supplier took over. Omar said that company used powdered eggs and powdered milk, even powdered potatoes -- “things I’d never seen before.”
The dream of self-employment now over, Armando left for Tijuana to work for someone else. Omar stayed in Obregon and supported his family, taking classes at night to finish high school. He was 14 years old when he entered the labor force full time.
“I was more prepared than him,” Omar said of his dad. “I had more education, I had a lot of advantages over him -- and it was like 1,000 times harder for me.”
The Sonora of small, local business owners who might lend a friend start-up money for their own small business was over. As far as Omar could tell, the only people opening businesses in Sonora after NAFTA were foreigners who had a lot of capital and who understood foreign markets. He says that even for entry-level positions suddenly a high school diploma mattered. English mattered.
Omar had no idea how he’d ever save enough money to start his own business. He tried working at grocery stores and liquor stores and even the same maquiladora, or manufacturing plant, where his father had once fed the workers until one day he ran into a woman there who was wearing a badge, with her employee number on it -- only three digits long, meaning that she was one of the first few hundred people hired.
Meanwhile, Omar’s employee number was six digits long. Yet, she told him, their wages were basically the same.
“And I was like, ‘Wow,’" Omar remembers. “I don’t want to be here, I don’t want to be like her. I can’t picture that as my future.“
At this point, the only place where it still seemed feasible to make it on hard work alone was the United States, proper documentation or not. Omar moved to Arizona in 2002 and started working first as a day laborer, and then for a residential painting company, always illegally. He was not alone: The Pew Hispanic Center estimates the very same year Omar arrived in the U.S., so did about 600,000 other Mexican immigrants, about double the number who came in 1991.
The reasons for this are many, but one big reason, economic-sociologist Kathleen Schwartzman says, has to do with the labor displacement that came with NAFTA.
“Generally people say that the jobs created in the maquiladoras didn’t compensate for the number of people who were being forced from the countryside,” Schwartzman said.
The same cheap imports that cost Omar’s family their business also cost a lot of small farmers their land.
“And that’s one of the sources of the migratory push,” she said.
Now, after 10 years in the U.S., Omar is finally opening his own business, a residential painting company. The hurdles Arizona presents -- for example, he’s forbidden from licensure -- are small, he says compared to the obstacles he watched his dad face post-NAFTA.
Omar is raising his son to believe in the same U.S. he found in the early 2000s, just as his father raised him to believe in the Sonora of the 1980s. But since Omar knows these things tend to change, he also has a back-up plan.
“Well, I will encourage [my son] to learn some Chinese, by the way,” he said. “You never know.”