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North America

By: Kelly Crossno

Even though it has been almost four years since Canada, the United States and Mexico became a free trade area under the North American Free Trade Area the debate continues as to whether or not it was beneficial to all concerned. There are those that still believe in Ross Perots’ 'sucking sound' theory, that many American jobs would trickle southward to Mexico where there is cheaper labor and the business laws are still vague. The other side is still adamant that the free trade area has done nothing but good for the American economy.

The experts can not even agree upon the effect that NAFTA has had. Over 300,000 jobs may be attributed to NAFTA but that is little compared to the 10 million created in the US since NAFTA began, and that doesn’t take into account those jobs lost because of NAFTA. Other reports say that there was a loss of 100,000 jobs and a creation of seven million jobs.

There is great discrepancy between the numbers because of the inability of the experts to agree on the number of jobs lost and those gained through the implementation of the free trade area. They either forget to count the number of jobs lost or grossly overestimate the number of jobs created. Even government sponsored reports can not seem to decide if NAFTA was beneficial to all concerned.

Officials in Washington may believe that there has been small improvement because of the treaty but even they say it was only modestly positive. A congressionally mandated three year progress report on NAFTA does say that trade between the US, Mexico and Canada has grown by 44 percent since the agreement was signed. This is compared to a 33 percent increase with the rest of the world.

NAFTA has only been in effect for four years now but the experts are still deciding if it was beneficial to the US economy. With all of the economic turmoil in the Mexican economy, with the drop in the value of their peso and their shaky stock market, it has been hard to assess the success of NAFTA. There are still two different camps debating the pros and cons of the treaty but even if NAFTA is not a complete success it may still be too early to tell.

Even if NAFTA is only marginally beneficial to the three states it helps create a better atmosphere of co-operation between the participants. Maybe it will take even more time to be completely sure if the treaty is good and more agreement between experts as to the amount of jobs lost and created due to the treaty. Clinton does not seem to care if NAFTA is effective or not and wants to expand the free trade area to include both North and South America by the year 2005.