This is when the problem began. Workers employed in other countries earned fewer wage than we did, therefore, they could produce the exact same goods at a lower cost to the manufacturers and consumers. This lead the United States to place tariffs and restrictions on imports so that prices would be comparable to the goods produced in America. As a result, the American standard of living kept climbing. During this time, the foreign competitors managed to steal a great deal of the United States technology. (3) However, the embargos were still in place and doing their job of protecting the American jobs.
Things were going great until the passage of the North America Free Trade Agreement (NAFTA). NAFTA was supposed to be a simple agreement to lower tariffs and increase trade between the United States and its neighboring countries. However, this agreement has backfired on the American economy. We are now losing our jobs and our wealth to other countries at a rate that is immeasurable. (4) The North America Free Trade Agreement has literally sent the United States economy in a tailspin. Worden summarizes this perfectly when he writes; "NAFTA removed our last line of defense against unfair foreign competition by manufacturers who now use cheap labor, equal manufacturing technology, and even our own raw materials to compete with American manufactures in a so-called "free" market." (4).
President Clinton signed NAFTA into law in 1993 with much opposition from fellow Democrats. Since then North Carolina alone has lost more than 130,000 jobs. Irwin Speizer reports:.
In a sense, North Carolina is ground zero in the continuing debate. While it has .
lost more jobs than any other state as a result of NAFTA, North Carolina also is.
home to companies that have seized opportunities presented by the agreement.
They are involved in some of the most ambitious U.S. corporate expansions in .
Mexico. (2).
In other words, when Clinton opened the borders to open trading with Canada and Mexico, many companies jumped ship and moved production across the border where the cost of manufacturing was lower than of that in the United States thus reducing cost to the consumers.
