Reading the NAFTA Tea Leaves

For those of us whose careers depend upon the successful reading of entrails, the recent vote for the North American Free Trade Agreement (NAFTA) was a career-challenging, once-in-a-lifetime, baptism-by-fire, (place your cliche here) experience. The escalating demagoguery and the reduction of a substantive issue to excruciating sound bites and appalling rhymes (NAFTA: we hafta, or we'll be sorry thereafta) during the weeks immediately preceding the vote were perhaps the strongest argument for keeping the administrative proceedings which accompany such international trade negotiations opaque.

The accord's opponents whose last-ditch attempts (tinged with more than a hint of Ludditism) to scuttle the agreement ultimately proved futile, were unable to marshal enough successful opposition to the agreement, which by eliminating tariffs anong Canada, the United States and Mexico, creates a $6 trillion dollar market with 360 million consumers.

NAFTA, in spite of being the first trade accord with progressive environmental provisions and effective enforcement mechanisms attracted a motley assortment of opponents, including strident labor groups, Pat Buchanan and the ubiquitous Ross Perot.

In a CNN debate that has now assumed mythic proportions, dwarf-slayer Al Gore routed Perot, diminishing his opponent's credibility by exposing the terrible hollowness at his core. While this may have negative repercussions for the 1996 election (Perot supporters tend to be disenchanted Republicans), Gore's performance enhanced his stature in Washington immeasurably.

A close examination of the detritus lying in the wake of last week's frenzied lobbying reveals that this debate has been instructive in revealing the enormity of the political challenges which face us in a post-Cold War environment. Lost in the debate however, was the fact that the terms of engagement between industrialized and developing countries, between the North and South have been redefined.

The accord, which was the first to link a developing country with a more industrialized one in a free trade arrangement is, it can be said without hyperbole, the most significant development since the fall of the Berlin Wall.

The most important clause in the entire 2000 page accord lies in the early pages of part one, which specifically states that the treaty establishes "a framework for further trilateral, regional and multilateral cooperation to expand and enhance the benefits of this agreement."

NAFTA thus provides an important avenue of opportunity for South American and Caribbean access to a lucrative North American market. This raises questions about the dilemma facing developing countries; how to raise standards of living while pursuing sustainable development and maintaining appropriate environmental resource exploitation. This begs the cynical, but relevant, question, of whether it is better to be exploited or not be exploited.

A disturbing thesis advanced by many of the supporters of the accord is that Mexicans will be content to stay locked in a low-wage, low-skills cycle. The increasing productivity of workers from developing countries cannot be summarily dismissed. No self-respecting or visionary leader could countenance such a future for her people.

The lobbying which preceded the actual vote also raised a crucial question as to whether a deliberative democratic process is actually necessary or desirable in this country.

The furor over NAFTA, when reduced to its elemental parts, can be summed up in a simple question: do we leave international trade and by extension, the reshaping of the world as we know it, to the bureaucrats and vested in who have coopted these crucial issues?

Secretary of Labor Robert B. Reich, must have been a soothsayer in another life and is certainly a visionary in this one (last year's New Republic hatchet-job notwithstanding), has succinctly encapsulated the terms of the new debate. In his 1991 book "The Work Of Nations" Reich observed that "the real economic challenge facing the United States in the years ahead--the same as that facing every other nation--is to increase the potential value of what its citizens can add to the global economy, by enhancing their skills and capacities and by improving their means of linking those skills and capacities to the world market."

It is not an exaggeration to say that current global changes are on par with those wrought by the Industrial Revolution. Consequently, sectors adversely affected in the global reordering need to be given financial support for retraining. It is an inescapable fact that a society driven by capitalism inevitably must face problems of obsolescence in both its skills and technology.

Another important issue facing us is the need to replace discredited ideologies. Is untrammelled capitalism the only way? The Marxist critique of capitalism cannot be completely discounted even though its alternative ideology crashed and burned spectacularly in Eastern Europe and the Soviet Union.

We need rival views and a wider range of workable choices. While NAFTA does not provide the answer to this dilemma, it points us in the direction of new strategies and new ways of thinking.