NAFTA gives the shafta to North America’s farmers

You're currently reading an archived version of Jim Hightower's work.

The latest (and greatest?) observations from Jim Hightower are only now available at our Substack website. Join us there!

What the media won’t tell you about globaloney

Last April at the presidential Summit of the Americas in Quebec City, our very own George W. Bush attempted to articulate his belief that all of the world’s people should be grateful that he and other leaders are creating ever more supra-national trade arrangements like NAFTA and the WTO: “It’s important for folks to understand that when there’s more trade, there’s more commerce,” he explained.

Enjoying Hightower's work? Join us over at our new home on Substack:

Okay. Has everyone got that? More trade means more commerce. Or is it vice versa? Whatever. This is what passes for intellectual depth in the shallows of BushWorld. Trade = good. Commerce = good. More = very good.

But trade at what cost, and commerce that profits whom? W. doesn’t address such complexities. His strong suit is not articulation, or comprehension for that matter. In Quebec, however, he had to say something, because tens of thousands of protesters were in the streets raising patriotic hell about the very corporate hegemony that he’d flitted in to advance.

It was George’s first chance as POTUS to strut on the international stage, but the noisy protesters had grabbed the limelight, forcing him and his fellow big shots to retreat into a small perimeter surrounded by six miles of razor wire and 6,000 armed police.

Bush was befuddled—why were the protesters there, why were they shouting, why would they hurl their bodies at a system that has showered such wealth on him and everyone he knows? Don’t they get it?, he wondered. If only these scraggly kids and the other boisterous protesters could know that the global corporate agenda is everyone’s agenda. Don’t fight it; let it embrace you. You could almost hear W.’s brain whirr as it strained to make the connection. Trade . . . commerce . . . more. What else could they want?

How about no more fairy tales, flim flam, and outright fraud being perpetrated on We the People by Bush and other apologists for a globalized scheme of trickle-down economics that has done nothing but profit the few at the expense of the many?

Do George and his corporate buddies think we’ve got sucker wrappers around our heads? The “scraggly kids” are not alone. For years, roughly three-fourths of the American people have been telling anyone who’ll ask them that they think NAFTA, the WTO, and other trade schemes are scams that have knocked down workers, added to pollution, exploited poor people worldwide, and subverted our democratic right to be a self-governing people.

The reason they think this is because they have firsthand knowledge of it. Not a week goes by without another community learning that some MegaGiant Inc. plans to abandon yet another American city, moving our manufacturing base, high-tech engineering, customer-service operations, food production, and every other industry to some low-wage free-trade zone where they can pay pennies to powerless laborers and pollute at will.

Bush might as well try pushing a string across his desk as try pushing people to applaud such an agenda of globaloney. To know the truth about these trade deals, he needn’t stoop to listening to union leaders, environmentalists, citizen activists, students, or others he treats as his enemies. Instead, he might try to have real conversations with the kind of hardscrabble family farmers he moved in on last year when he bought himself a pristine white, Nieman-Marcus cowboy hat and a picture- perfect, presidential ranchette near Crawford, Texas. He might try articulating to them his contention that what America’s farmers need most is more trade deals like NAFTA.

Down on the farm

Little George isn’t the first to come along in a medicine wagon, offering the snake oil of “free trade” as a cure for the economic woes of the farm community.

In 1993, when the North American Free Trade Agreement came before Congress, farmers were told that it would throw open the gates to the Mexican and Canadian borders, allowing them to export their way to prosperity by selling their surplus corn, chickens, and whatnot in these golden globalized markets.

Lean on your Congress critter to back NAFTA, farmers were urged by Bill Clinton, Al Gore, Newt Gingrich, Bush the Elder, the media establishment, most farm leaders, their own bankers and suppliers, the middleman corporations that buy their commodities, and a chorus of ag academics. Sure enough, nearly every rural member of Congress joined the push to give NAFTA to America’s farmers.

It turns out to have been the shafta, for the promises made by the establishment were pure piffle. In the years since Congress okayed the agreement, America’s media barons have turned a deaf ear to the steadily rising cries from the countryside that these trade schemes are crushing the farm community. What the media ignored, however, a number of public-interest, family-farm, and religious groups have been carefully documenting.

In June, Public Citizen’s highly regarded Global Trade Watch staff produced an extraordinary report that was authoritative, factual, well-written, important, and damningly revelatory—and, therefore, almost completely ignored by the media big shots, who don’t want any pricking of the ideological bubble they’ve floated for so long about the glories of globalization.

Entitled “Down on the Farm,” Public Citizen’s report draws on the government’s own statistics, academic analyses, the business press, and testimony of farmers themselves to deliver a real-life portrait of NAFTA’s impact on farmers and ranchers, not only in the U.S., but also in Mexico and Canada.

The farm crisis

The establishment’s spin is that the family farm is an antiquated, inefficient institution in irreversible decline—like an elder whose time has come.

The truth is that the family farm is a vibrant engine of efficiency, unmatched by any other sector of the food economy. Indeed, its efficiency is its downfall, for it constantly has produced way more cotton, cattle, corn, cantaloupes, carnations, and every other crop than the international market will buy. Too much supply, of course, means that the price plummets on these commodities, crushing farm income.

For the multinational middleman that buy these commodities, however—companies like Cargill, Tyson, Archer Daniels Midland, and ConAgra—low farm prices are much to be desired. Like hogs loose in the cornfield, they can gorge on the cheap oversupply and fatten their profits.

This is where agriculture politics has turned ugly, and where trade deals have become farm-killers. Instead of helping our nation’s farmers control their overproduction (something no individual farmer can do), federal policy now is controlled by—guess who?—Cargill, Tyson, ADM, and the other giants that profiteer from overproduction and that put major campaign contributions in the pockets of both political parties.

Official U.S. policy encourages farmers to produce too much (a policy that Congress cynically labels the “Freedom to Farm Act”) so middlemen can get cheap commodities. The family farm is not dying—it’s being mugged!

Now comes NAFTA, which exacerbates the farmers’ vulnerability. Again, U.S. farmers were told that this deal would open up the Mexican and Canadian markets so their overproduction could be exported. But Mexico and Canada already grow a lot of the same stuff we do. Plus, the transnational conglomerates that operate here operate there as well.

NAFTA simply gives Cargill and the like more overproduction to play with and the ability to pit one nation’s farmers against the other’s, since the rigged rules of NAFTA prohibit any of the three countries from taking action to protect their own farmers. NAFTA said to middlemen: Go hog wild! And they did.

Prior to NAFTA, our country’s ag shipments to these two neighbors were worth $200 million a year more than we bought from them. Seven years later, we’re $1.5 billion a year in the trade hole, buying that much more worth of agricultural goods than we sell to them.

Worse, what we’re importing are largely the very crops our own farmers produce— since NAFTA, 80% of the foodstuffs coming into the U.S. are products that displace the crops raised here at home. NAFTA allowed the multinational middlemen to increase production in Mexico, where they can profit from farm labor paid the sub- poverty pittance of $3.60 a day, freely use pesticides banned in the U.S., and then ship those farm products back into our consumer market without any tariffs, quotas, or effective food-safety restrictions.

The official statistics of the decline in the USA’s farm-export prowess since the agreement was implemented tell an unforgiving tale that belies the rosy glow of official press releases about NAFTA’s impact:

[bullet] Wheat exports to Mexico and Canada fell by 8%, and prices dropped 28%.

[bullet] Corn exports fell by 11%, and prices dropped by 20%.

[bullet] Soybean exports increased by 16%, but prices dropped by 15%.

[bullet] The poultry trade surplus with Mexico and Canada fell by 14%.

[bullet] Cattle and beef fell from a $21 million surplus to a $152 million deficit.

[bullet] The grain and cereals surplus fell by a third.

[bullet] The fresh and frozen vegetables deficit more than doubled to $1 billion.

[bullet] The fresh-fruit trade deficit nearly quadrupled.

[bullet] Frozen fruit fell from a $9 million surplus to a $37 million deficit.

[bullet] The dairy deficit nearly doubled to $796 million.

Public Citizen’s report documents similar trade declines in most other commodities, from asparagus to zinnias. With these declines, the income of U.S. farmers has plummeted 35%, from $59 billion in the years before NAFTA to a projected $41 billion this year. During the reign of NAFTA, we’ve lost farms (and good farm families) at a rate six times steeper than were lost prior to the 1993 agreement.

The grass is not greener

Well, you might think, at least our trade losses mean that Canadian and Mexican farmers have prospered, right?

Hardly. Global Trade Watch found that even though Canada’s food exports to the U.S. and Mexico more than tripled during the NAFTA years, farmers didn’t get the gains. Indeed, farm income there fell by 17% in these years, and farmers’ debt zoomed up by half.

The beneficiaries were the processors and exporters, which are the same companies that operate here: ADM owns more than half of Canada’s wheat-milling capacity, for example, and Tyson owns 66% of the beef-packing plants there.

The situation is worse in Mexico, where corn is the staple crop and corn tortillas the staple food. NAFTA has devastated the small corn farmers there, for it allowed the export giants to suddenly dump millions of tons of surplus U.S. corn (cheap, because of the price-bust for our corn farmers) into their market. The export companies now ship 15 times more U.S. corn into Mexico each year than they did prior to NAFTA, and these imports have cornered 25% of the market there—up from only 2% pre-NAFTA.

At the same time, as a price for joining NAFTA, Mexico had to alter its constitution to eliminate its historic ejido land-reform program that protected small farmers and guaranteed a price floor for them (like a minimum wage for workers). With no price floor and a deluge of imported corn, the price paid to Mexican farmers for their corn has plummeted by almost half since 1993—far below what it costs them to produce it.

The result is that an estimated 15 million rural Mexicans have been forced out of farming, lost their ejidos, and migrated to cities or to the U.S. Perversely, the price that Mexican consumers pay for corn tortillas—central to the cooking of all families and essential to the food budgets of the poor—has jumped by half.

Even more perversely, the country that identifies its cultural heritage with corn, and that had been self-sufficient in this staple, now is dependent on foreign suppliers. Whenever ADM, Cargill, and the other giant corn shippers can get a better price elsewhere, or whenever there is a corn shortage due to poor crops in the U.S. (as happened in 1996), Mexico is thrown into a food crisis.

As Global Trade Watch writes in its report: “Post-NAFTA Mexico no longer has policies to ensure it can feed itself.” Welcome to “the New World Order,” as Bush I described his global vision of corporate-controlled trade.

Peddling the globaloney

Now comes Bush the Lesser with more of daddy’s patent medicine, telling farmers that if NAFTA didn’t work for them, it’s because they didn’t swallow enough of the free-trade elixir. Now he’s pushing them to try the extra-strength, super- sized “Free Trade Area of the Americas,” which he hopes to pass this year. This would extend an even more corporate-friendly version of NAFTA to 31 other Latin American countries (see The Lowdown, May 2001).

Just think, Bush proclaims to the farmers, as if they’d just ridden into town on a turnip truck, with FTAA you’d be able to ship all your food thingies to Brazil, Argentina, Chile, and other Latin-speaking places down under our country.

Hello—George? These countries already are huge ag producers, and your FTAA would let the multinational exporters ship even more crops from there into our market, displacing more U.S. farmers. Beef and soybeans from Argentina and Brazil, fresh fruit and wine from Chile, and orange juice from Brazil are just a few of the commodities that would flood into our markets under FTAA, busting the U.S. price for these products, wiping out farmers and ranchers, increasing our nation’s trade losses, and making us more dependent than ever on foreign sources for food that’s controlled by a handful of global middlemen.

Wait, cries Bush, there’s more! He also wants to get China into the World Trade Organization this year, telling farmers that WTO membership would make China open its market of 1.3 billion people to American exporters.

Knock, knock, George—is anyone home? China is a burgeoning agricultural giant that is determined to stop being an importer of food and become a major exporting powerhouse, especially in labor-intensive fruit and vegetable crops that U.S. farmers happen to be producing.

In the past decade, China has become the world’s largest producer of fruits and vegetables, growing seven times as much fruit as we do. China’s apple production, for example, has quintupled in that time, and the head of the U.S. Apple Commission— previously an enthusiastic backer of globalization—now says: “Our constituents are starting to question the value of some of these trade agreements.”

Apple, rice, and broccoli producers are among the U.S. farmers who have been stunned in just the last few weeks to find China taking away export markets in Japan and other Asian nations that America has been counting on to absorb 38% of our total farm exports. The one Asian export market the U.S. still controls is Taiwan, which currently bans imports from mainland China. But Bush is squirreling this for our farmers, too, by pushing Taiwan’s membership in the WTO. If both China and Taiwan join the WTO, as expected, Taiwanese officials no longer will be able to block the entry of Chinese food products, and our farmers will lose the major chunk of this valuable market.

When Casey Stengel managed the inept New York Mets during their first year as a big- league baseball team, he asked in exasperation: “Can’t nobody here play this game?” Bush and team, like Clinton and team before them, can’t seem to figure out the trade game. A policy of trade-at-all-costs is a loser, and commerce for its own sake (or for the sake of commercial elites) is not a worthy public goal. Trade and commerce are valuable only when they are grounded in democratic values and actually improve the lives of the majority of people.

NAFTA, WTO, FTAA, and the rest of the current free-trade line-up are failures because they are corporate schemes whose goal is to drive down costs (particularly labor and environmental costs) and push profits up. They are grounded in nothing more substantial than greed. They don’t work for people. This, George, is why protesters are hurling their bodies at the barricades of the powerful, and why there is no popular support for extending the free-trade fraud.

I’m making moves!

We’re pleased to announce that we’ve started a Substack newsletter for all of our content. You’ll still find our older, archived materials here at, but the latest (and greatest?) observations from Jim Hightower are only now available at our new Substack website.

Check out »

Send this to a friend