Has NAFTA been good or bad for the US, and Oregon's, economy?
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Opinions vary greatly about the impact of NAFTA, but most evidence points to some modest benefits for the US, Canada, and Mexico.
For example, US trade (exports and imports) with Canada and Mexico have grown somewhat faster than with our other trading partners
since NAFTA was put into effect. As expected, however, some benefits to producers in Mexico and Canada have come
at the expense of producers in the US (and vice versa). Similarly, some benefits to consumers in the US have come at the
expense of consumers in Mexico and Canada.
Joseph Stiglitz, the Nobel Prize winning economists, published an article on the 10th anniversary of NAFTA titled "The Broken Promise of NAFTA[pdf]." He points out that none of the dire warnings of Ross Perot and others have materialized. But he focuses on why NAFTA has been a disapppointment, primarily for Mexico. He suggests that NAFTA helped Mexico recover from a financial crisis in 1994. But he says that early benefits have waned, not because of mistaken belief in the potential gains from "free trade" in competitive markets, but because government policies and other factors have hindered the realization of those gains. The obstacles cited by Stiglitz include US corn subsidies, strong competition from China (likely due in part to China's aggressive exchange rate policies), and Mexico's weaknesses in terms of technology, infrastructure and education. Evidence also shows gains for Oregon under NAFTA and the WTO. Oregon exports rose 104% from 1994-2000 to Mexico and Canada, which is a higher rate of growth than to other trading partners. Similarly, since China joined the WTO, Oregon exports to china tripled (200-2003). ~
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