World Market 101

Imagine you're a Mexican corn farmer in 1994. On a small plot of rain-watered land, you grow corn for your family, with a bit left over to sell so that you can buy medicine, clothes, and other necessities. You may or may not be aware that your government has just negotiated a trade deal, the North American Free Trade Agreement, with the governments of the U.S. and Canada. But if you don't know, you will soon—up close and personal.

Hundreds of miles north, impelled by market forces, U.S. farmers are using petroleum- and pesticide-intensive farming methods that produce large yields but pass on environmental costs to future generations. Because of this, and also because they receive massive government subsidies (most of which wind up going to agribusiness), their corn sells for a much lower price than yours. For decades, your government, like that of many low-income countries, has protected its farmers with tariffs on imported corn, which makes it easier for your corn to compete in Mexico. Now NAFTA will end the tariffs that protect you, without affecting the production model or subsidies that make U.S. corn so cheap. To ease the impact, the Mexican government had negotiated a 15-year transition period on corn tariffs—but large-scale Mexican cattle growers, who want cheap feed and have more political pull than you do, will talk the government into getting rid of tariffs in a mere 30 months. The price you get for your corn will plummet nearly 50 percent.

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Sojourners Magazine May 2007
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