> Date: Tue, 18 Apr 1995 14:53:23 -0700 (PDT) > From: Dale Wiehoff <[EMAIL PROTECTED]> > To: Recipients of conference <[EMAIL PROTECTED]> > Subject: Revised NAFTA job prediction > > From: dwiehoff (Dale Wiehoff) > > From: The Wall Street Journal, April 17, 1995 > By: Bob David > Title: The Outlook: Free Trade Is Headed For More Hot Debate: > > "The Mexican meltdown demolished the Bush and Clinton administrations' > formula to sell Nafta: free-trade pacts=exports=jobs. With the peso > devaluation, the U.S. trade surplus with Mexico will disappear and with the > claim that Nafta will generate jobs, says Gary Hufbauer, a trade economist > whose predicition that Nafta would create 130,000 additional jobs in five > years was parroted by the White House. > 'The best figure for the jobs effect of Nafta is approximately zero,' he > says now. 'The lesson for me is to stay away from job forecasting.'" > ................................................................................ > For more on what Hufbauer and the Economic Policy Institute (EPI) should > stay away from, please see the review of his book, NAFTA: AN ASSESSMENT, by > Kai Mander, available at the IATP gopher > site:<gopher.igc.apc.org:70/11/trade/iatp> in the Trade Library conference, > topic #139. > ............................................................................ > .... > Some excerpts: > > "In spite of their own research findings to the contrary, Hufbauer and > Schott nevertheless hold up the ideological argument of free trade as > proof of long-term benefits. They claim, "Investment by US firms in > Mexico is a 'good event' rather than a 'bad event' for the United > States" because "foreign investment by US firms creates US jobs, > both in the short run, by boosting US exports of capital goods, and in > the long run, by establishing channels for the export of US > intermediate components, replacement parts, and associated goods > and services" (19). > > The authors hope to quell concern about US companies moving to > Mexico, but again their argument is inconsistent. "The fact that some > US plants close, just as some Mexican plants close, should be read as > evidence that the market system is working, not that it is failing. > >From the standpoint of the US economy as a whole, what counts is > how many net jobs are created by NAFTA" (14). Ten pages later, in > arguing the US will benefit from greater competition and a larger > continent-wide market created by NAFTA, they claim that increased > efficiency and higher output will earn approximately $15 billion a > year between Mexico and the US. "Over the long-term, this figure -- > not jobs won or lost -- is the true measure of the economic gain from > the NAFTA agreement," the authors contend (24). > > ...Hufbauer and Schott's specific plans are not realistic. Each seems to > be based on an amazingly profound faith in the governments and > corporations of the US, Canada and Mexico to act in an ethical fashion. > They recommend that the US-Mexico Binational Commission not have > the "power to levy fines or award money damages against particular > firms or industries," but instead should act as "a roving spotlight." If > businesses do not conduct themselves properly of their own accord, > the authors contend, "The glare of publicity should be sufficient to > promote compliance" in most cases. (30) While a great glare of > publicity does have its influence, a commission report would be an > unlikely source to stir up such a public outcry." > > ---- > Dale Wiehoff > Communications Director > Institute for Agriculture and Trade Policy (IATP) > 1313 5th St.,SE, Suite 303 > Minneapolis, MN 55414-1546 USA > Tel: (612) 379-5980 Fax: (612) 379-5982 > Email: [EMAIL PROTECTED] > > > > > > >
