Corn, Sugar to Trade Freely as Final Nafta Tariffs Are Ended

[Judi Lynn]

Source: Bloomberg

Corn, Sugar to Trade Freely as Final Nafta Tariffs Are Ended

By Mark Drajem and Adriana Lopez Caraveo

Dec. 28 (Bloomberg) -- Mexico and the U.S. are about to eliminate the last tariffs on goods they trade, prompting opposition by lawmakers and farmers in both countries who anticipate a flood of cheap imports.

In Mexico, farmers plan nationwide protests over what will be the final step in implementing the North American Free Trade Agreement on Jan. 1 and eliminating tariffs on American-grown beans and corn. The U.S. will drop tariffs on flip-flops, glassware and sugar, the most price-sensitive import.
(snip)

Critics say the agreement has led to a loss of one million factory jobs in the U.S., while subsidized U.S. imports pushed millions of farmers in Mexico off their land and spurred illegal immigration.

``Mexican agriculture has been a net loser in trade with the United States, and employment in the sector has declined sharply,'' former Clinton administration official Sandra Polaski testified before the U.S. Senate last year.


Read more: http://www.bloomberg.com/apps/news?pid=20601086&sid=aecLioKgg9cU&refer=news

[Demeter]

1. Please, Sir, Does That Include Cuba?

Just asking!

[Warren Stupidity]

7. Of course not you silly duck.

We must continue the embargo! We cannot trade with commies who stole EVERYTHING from Meyer Lansky, Santo Trafficante, et al!

[Judi Lynn]

8. That was some racket they had going! Batista built their hotels,casinos for them with Cuba's own

revenue, basically GAVE them their places of operation, then sent his brother-in-law around every night to the casinos as the bagman to pick up nightly "fees," and the death squads were always available to sweep through the streets looking for dissidents they could take back and torture, before throwing him or her out on the road, or hanging him from light poles, or trees as a warning to others.

In the meantime, the poor lived with only seasonal work in the sugar cane fields, etc., in shacks without plumbing and electricity, no land on which to grow their own food, no education, medical treatment, and a huge number of Cubans lived with internal parasites, as a final insult.

But life was sweet for the European-descended Spanish Cubans in Havana and the big towns. As long as the lucky ones were happy, what on earth COULD the poor Cubans want to revolt against?

Keep that embargo on'em. Make 'em all cry "uncle" and beg for the hogs in Miami to come back and take over again, and bring back the Mafia, why not.

[sentelle]

2. I would guess that it might lower the cost of corn

A lot of corn is being converted to Corn Syrup, simply to drive up the price of corn. The corn syrup is cheaper than sugar, because of the high tarrifs on sugar. As a result of this, we might actually see a decrease in the cost of domestic corn and imported sugar, and perhaps (i hope) a transition back to sugar from High Fructose corn syrup.

[truedelphi]

13. Hope that happens.

i hate NAFTA but would be more than willing to accept one silver lining in that black black cloud

[ronnie624]

3. There goes my indulgence in Mexican Coca Cola,

which currently contains real sugar, instead of high fructose corn syrup.

"U.S. growers see a new market for high fructose corn syrup. Mexico has limited imports through taxes or other duties."

Yuck!

Seriously, more bad news for the working class in both Mexico and the U.S. Our struggle for social and economic justice will be long and difficult.

[Judi Lynn]

5. Millions of Mexican farmers lost their jobs, and their generations-old family farms, their whole way

of living after the first round of NAFTA, when the U.S. taxpayer-subsidized corn (a product Mexican farmers have been raising for THOUSANDS OF YEARS) flooded Mexico with a product so cheap (American consumers/taxpayers paying the difference on this side) flooded Mexico, and drove them out of business. They could NOT pour their energy and substance into raising corn and sell it at cheaper prices, and went right down the tubes, driven into poverty, driven, in fact, to the States to try to find work.

We destroyed their jobs in Mexico, then, when they tried desperately to come here as their last hope, turned on them with a hate-driven frenzy. Makes so much right-wing sense, doesn't it? What the hell were they supposed to do, shut the #### up and kill themselves?

They need a source of income to be able to buy those fine American products flooding their market back in Mexico. Where the hell will they get their money to buy from us if we have destroyed their jobs?

Jezus.

When WILL people take the time to know what they are doing? Apparently only after life as we've known it is completely destroyed.

[killbotfactory]

4. great, more high fructose corn syrup in everything

that's what we need. I'm so glad it's subsidized.

[Raine]

11. I hate that stuff

it's a disgusting mess and makes everything taste horrible. :puke:

[depakid]

19. Ethanol mania should help with that

Not so good for the Gulf fisheries, though.

[wuushew]

6. Eliminating sugar tariffs is a good thing

the other stuff...not so much.

[robcon]

9. Wonderful news.

The sugar quotas (not tariffs, as the article indicates) were the most obnoxious element of the the U.S. trade stance: politicians were bought by the Florida sugar growers to hold onto those quotas in most "free" trade agreements that the U.S. has signed. The quotas (at least with Mexico) are over.

[BearSquirrel2]

10. Of all the things you could tariff ...

Of all the things you could possibly tariff, sugar is the most ridiculous. We've let the base of American manufacturing go overseas over a poor sugar growing economy.

[patch1234]

15. an indirect subsidy to US growers

(currently)
US sugar trades for 20 cents a pound.

World sugar trades for 10 cents

[Judi Lynn]

12. Aftermath of the first brush with NAFTA in Mexico:

In the 1980s Mexico was still self sufficient in corn, its major staple. In the early 1990s Mexican president Salinas de Gortari decided to cozy up to the U.S. by implementing the North American Free Trade Agreement (NAFTA) ahead of schedule. He relaxed controls on corn imports from the United States. Imports immediately jumped from 396,000 to 4,854,000 metric tons, flooding the Mexican market with taxpayer-subsidized, U.S. corn. Mexican farmers—whose government agricultural support services had dried up thanks to World Bank/IMF structural adjustment policies in 1982—were unable to compete with cheap corn that was sold at prices under its actual cost of production. U.S. corn quickly replaced Mexican corn for the tortilla market. The tortilla market itself consolidated under GRUMA, a Mexican transnational corn processing giant.

In the first year of NAFTA, over 700,000 Mexicans crossed the border into the United States looking for work—many of them farmers or their able bodied-children. From 1994-2004, 1.3 million smallholders went bankrupt. After 13 years of NAFTA, a million immigrants from Mexico and Central America still come to the U.S. each year.

Now that Mexico’s self sufficiency in corn has been all but destroyed, and now that most of its rural workforce is in the U.S. working in slaughterhouses, migrant farm labor and low-end service industry jobs, the price of corn has gone up. Why? Because Archer Daniels Midlands, Cargill and Monsanto are busy expanding into the biofuels market for corn-based ethanol, sending corn prices skyrocketing. Some rural advocates see this as a positive development. It is welcomed by some corn farmers in the Midwest. Won’t Mexican farmers be able to start growing corn again, thus bringing food security back to Mexico? The answer is unequivocal: That depends…

It depends on how effective agribusiness is at draining the windfall profits from U.S. farmers. The big three (ADM-Cargill-Monsanto) are already forging a custom, genetic-processing-transport alliance that will sew up ethanol production, processing, and sale. (ADM is already gobbling up farmer-owned biofuels coops.) None of these companies are famous for sharing the farm dollar with farmers. On the contrary, Monsanto is suing U.S. farmers for over $15 million for saving its seed. All three have been implicated or heavily fined for anti-trust and other illegal activities. It is hard to imagine farmers benefiting when the powerful triad controls the genetically-modified seeds, the custom processing technology, and the transport for corn and biofuels.
(snip)

.......the implementation of NAFTA destroyed Mexican corn production and then, when demand for ethanol raised the price of US corn, left a large fraction of Mexico’s poor hungry.

More:
http://www.foodfirst.org/node/1604

[otherlander]

14. Tariffs on flip-flops?

[benh57]

16. it's all about Big Flip Flop

the Big Flip Flop industry is behind this.

No Blood for Flip Flop, i say!

[Judi Lynn]

17. Mexico's protection for farm goods runs out, leaving farmers feeling rootless

Mexico's protection for farm goods runs out, leaving farmers feeling rootless
The Associated Press
Published: December 29, 2007

MEXICO CITY: For 15 years, Mexican farmers have feared the day when the last import protections end for the country's ancestral crops of corn and beans.

But as Jan. 1 draws near, farmers say the damage has already been done: Mexico has plunged deeply into a model of globalized agriculture where farmers are ill-prepared to compete, and even people who don't farm for a living are suffering.

Nobody knows that better than Vicente Martinez, who grows corn, beans and some coffee in the green mountains of Tepetlan, Veracruz. In July, his daughter Felictas died trying to cross the desert to enter the United States. Martinez blames a combination of free trade and dwindling government farm-support programs that leave rural families with little choice but to migrate; his daughter found no work in their farming town to support her four children, other than cleaning houses for little pay.

"The only thing left to do is run for the United States ... or sit around looking like idiots, because there's nothing to do here, nothing," said Martinez, whose daughter was abandoned by a people smuggler in Arizona.

More:
http://www.iht.com/articles/ap/2007/12/29/america/LA-FIN-Mexico-NAFTA.php

[robcon]

18. But Mexico sugar producers win.

Certainly, Mexico's corn producers were whipsawed by the removal of trade barriers - they were nowhere near as productive as U.S. corn producers, and were not competititve.

It's awful that Mexico's sugar producers, who are more than competitive with U.S. producers (even after the water and other subsidies U.S. sugar producers receive), had to wait while the corn producers got slaughtered. But delayed justice is justice.

The treaty is now fairer than it's ever been, with Mexican trucks treated the same as Canadian trucks in the U.S., and Mexican sugar producers now on close to an even plane with U.S. producers.

[Judi Lynn]

20. NAFTA & Globalization is Killing Mexico's Farmers

NAFTA & Globalization is Killing Mexico's Farmers
The Dallas Morning News
August 9, 2001, Thursday

~snip~
But for most people, the problems on the farm seem to be getting worse.
That's especially true for the millions of ejido farmers who have relied on
traditional crops like corn, beans, sugar and coffee.

Mexico used to buy their corn at prices far above those on world markets.
But free market reformers abolished that system in the 1990s, and NAFTA
opened the border to U.S. imports. Over the past three years, prices for
Mexico's 4 million corn farmers have fallen by nearly half.

In the state of Veracruz, sugar farmers are lurching toward ruin. Mexico
says NAFTA allows the export of Mexican sugar to the United States. U.S.
officials disagree, and keep the border closed. Meanwhile, U.S. companies
export corn syrup south of the border, and their low prices have wrested
market share from Mexican sugar.

As for coffee, world prices have fallen to their lowest level in years. And
about four million coffee farmers have seen their incomes plummet.
"The first thing we need is for the government to listen to us," said Jose
Luis Hernandez, an activist with campesino groups and labor unions. "How can
they come up with solutions for the countryside if they don't even ask
campesinos what we need?"

More:
http://www.organicconsumers.org/Corn/NAFTAkills.cfm

[Judi Lynn]

21. NAFTA Equals Death, Say Peasant Farmers

Published on Wednesday, December 4, 2002 by the Inter Press Service
NAFTA Equals Death, Say Peasant Farmers

by Diego Cevallos

http://www.commondreams.org.nyud.net:8090/headlines02/images/1204-01.jpg

Mexican campesinos stand at a barrier as a row or riot police
stand guard during a protest outside the U.S. embassy in Mexico
City against NAFTA (North American Free Trade Agreement)
December 3, 2002.Mexican campesino organisations are asking for
a moratorium on the removal of tariffs on agricultural products
from the U.S. into Mexico as they fear the market will be flooded
with cheaper imports after January 1, 2003 when agricultural trade
tariffs are due to be dropped. REUTERS/Andrew Winning

~snip~
More than 85 percent of Mexican trade is currently concentrated in exchange with the United States.

But for Mexico's rural areas, where 75 percent of the population living in extreme poverty is concentrated, the three- country treaty has meant the loss of more than 10 million hectares of cultivated land.

And the decline of the rural sector has pushed 15 million peasants -- and mostly young people -- to move to the cities, either in Mexico or in the United States, according to a study by the Autonomous National University of Mexico (UNAM).

Over the last 10 years, the participation of the farming sector in Mexico's gross domestic product (GDP) has fallen from 7.3 percent to less than 5.0 percent.

The protests Tuesday echoed similar demonstrations in November, including the blockade of a main federal highway by farmers in the state of Morelos, neighboring the Mexico City federal district, and protests by peasants from the southern states of Oaxaca and Guerrero outside government offices in the capital.

The common denominator of all of these events is the rural producers' rejection of NAFTA.

''The farmers are walking towards death because they are up against the 'disloyal' trade competition from the United States and the Mexican government's desertion of the countryside,'' says Alberto Gómez, UNORCA executive coordinator.

Without exception, Mexico's farmer organizations believe the new phase of NAFTA-stipulated farm trade liberalization will generate more poverty and prompt more people to leave rural areas.

They also reckon that the financial support Fox has promised will not be nearly enough.

Mariano Ruiz, an analyst with the Mexico City-based Grupo de Economistas y Asociados, says the worst blow for the Mexican farmers will come in 2008 when the agricultural tariffs on products like maize and beans are lifted.

An estimated 2.8 million Mexican farm families make their livelihood from these commodities.

''The countryside is a time-bomb that could explode very soon,'' commented Rosario Robles, chairwoman of the leftist Democratic Revolutionary Party (PRD), the country's third political force.

More:
http://www.commondreams.org/headlines02/1204-02.htm

[Joanne98]

22. Did they eliminate the subsidies too?

[Judi Lynn]

24. I haven't seen any indication American food producers would give up one red cent in subsidies. n/t

[Judi Lynn]

23. NAFTA Free Trade Myths Lead to Farm Failure in Mexico

NAFTA Free Trade Myths Lead to Farm Failure in Mexico
Laura Carlsen | December 5, 2007

Americas Program, Center for International Policy (CIP) americas.irc-online.org

On Jan. 1, 2008 the last remaining tariff barriers permitted under the North American Free Trade Agreement (NAFTA) are slated to fall. Corn and beans were given the longest (15 years) liberalization schedule because they are at the core of Mexican culture and subsistence. Other key products—including sugar, milk, and chicken, which had formerly been regulated under a safeguard agreement to protect Mexican production, are also included.

The tariff removal ostensibly gives full rein to an open-market trade and investment regime between the United States and Mexico. The idea is that all products now enter into a competitive market that will self-regulate to enhance production, efficiency, investment, and, indirectly, the lives of Mexican producers and consumers.

That's the idea. But what has happened in the Mexican countryside over the past 14 years of NAFTA shows that free trade has been a disaster for small farmers in Mexico.

Corn farmers forced out of business by subsidized imports from the United States have swollen the ranks of migrants to the United States, where many of them contribute their poorly paid labor to the same agricultural sector that displaced them. New generations of children in rural areas see their only future en el otro lado, on the other side, where their fathers, mothers, uncles, or cousins earn the money they send home that enables their families to survive.
(snip)

~~~~~~~~~~~~~~~
Mexican Agriculture after
14 Years of NAFTA
Importing food, exporting farmers ...

Every hour, Mexico receives $1.5 million dollars worth of food imports

In that same one-hour period, 30 farmers leave Mexico for the United States

40% of Mexicans' food is imported

Over 1.5 million rural jobs were lost in 12 years A dying countryside...

Agriculture's share of GDP dropped from 10% to 3.4% between 1981 and 2006

Rural population dropped from 40% to 30% in that period

388 municipalities have become ghost towns due to out-migration

Genetically modified corn has contaminated native strains

Corn production for ethanol threatens to reduce corn for human consumption and raise consumer prices for Mexico's main staple food

Arable land is increasingly dedicated to illegal drug production

Erosion renders useless thousands of acres of productive land a year Source: La Jornada del Campo #2, Oct. 9, 2007
~~~~~~~~~~~~~~~
Conclusion: Policies Based on People, Not Myths
If the free market is a dysfunctional myth, and if the model is impoverishing the vast majority of rural producers and contributing to immigration and poverty, should it continue to be considered the organizing principle for Mexican agriculture and the sole basis of the two nations' trade relations? What's happened in Mexican agricultural justifies at the least a serious re-evaluation of the NAFTA agricultural chapter. In demanding suspension of the tariff removal, Mexican farm organizations are saying that it's time to discard the myths and permit human values to play a role in their agricultural policy.

Mexican farmers not only reject an asymmetrical trade agreement that destroys their livelihoods and their communities, they also reject being railroaded onto a one-way street. To compete with the United States means to adopt the U.S. transnational-dominated model of agriculture—a model severely questioned by family farmers in the United States as well. Competing on these terms—the only ones understood by a market driven solely by prices—is unraveling Mexican society. Buying into this corporate myth could jettison 9,000 years of culture, domesticated agriculture, and biological and agricultural diversity.

The failure to resolve the Mexican agricultural crisis in large part caused by NAFTA has increased migration and complicated relations between the United States and Mexico and between our people. But the problem goes beyond migration. The United States could soon have to deal with the destabilizing effects of imposing a rigid free trade model on Mexico that fails to take into account the needs of the poor.

Instead, both countries could rethink trade policies and begin to base new ones on reality, not myths. An integral vision of what rural producers and consumers need and offer forms the basis of the food sovereignty approach developed by the farmers' movement.

More:
http://americas.irc-online.org/am/4794

[robcon]

25. Rarely has a cut-and-paste been so full of misinformation,

or very positive news masquerading as negative news...

Importing food, exporting farmers ... Every hour, Mexico receives $1.5 million dollars worth of food imports
That's terrific news, and important to the growth of the Mexican economy that the economy of Mexico is more involved in value-added work (manufacturing/services) rather than commodities like agriculture.

In that same one-hour period, 30 farmers leave Mexico for the United States
Unchanged from pre-NAFTA days.

40% of Mexicans' food is imported
Again: terrific news, as the Mexican economy has become much more dependent on high value-added products, rather than agricultural commodities.

Over 1.5 million rural jobs were lost in 12 years A dying countryside...
Totally expected, and positive for Mexico. Urbanization is essential to economic growth.

Agriculture's share of GDP dropped from 10% to 3.4% between 1981 and 2006
And if it declines more, the economic impact will continue to be very positive for Mexico and Mexicans.

Rural population dropped from 40% to 30% in that period
If only it could drop some more, the economy of Mexico will improve even more, although it will take a long time for Mexico to have less than 3% of the population (less than 2% full time) in agriculture like the U.S. has.

388 municipalities have become ghost towns due to out-migration
Urbanization is expected and a big bonus accounted for by NAFTA.

Genetically modified corn has contaminated native strains
So what, if true? Any negative effects yet? I haven't heard of them.

Corn production for ethanol threatens to reduce corn for human consumption and raise consumer prices for Mexico's main staple food
So.... the price of corn has been reduced by the reduction of subsidies and competition from the U.S., resulting in declining production because Mexican farms do not compete well for corn vs. U.S. farms. Then you make the point... at the same time.... the prices have gone UP? You can't have it both ways, unless you are willing to lie to make a point.

Arable land is increasingly dedicated to illegal drug production
As if drug production has been affected by NAFTA. You KNOW how much this whole "analysis" is a stretch if that is given as a result of NAFTA.

Erosion renders useless thousands of acres of productive land a year
Excuse me???? People are leaving farms in droves... and yet you claim erosion and overuse of land is increasing??? Another contradiction in the "analysis" which shows very little regard for the truth...

If lies serve the purpose of making the "case" against NAFTA, lies are used liberally in this "analysis" you've provided.

[Judi Lynn]

27. Rather than offering your opinion, why don't you share some links for DU'ers to consider?

Looks like a good way to go.

[robcon]

29. Why are you afraid of me offering my opinion???

n/t

[Judi Lynn]

28. Would strongly "recommend" that DU'ers "read" a lot more so they can come to their "own conclusions"

That way "they" won't misled by "anyone."

"I'd" like to "suggest" people "research" the subject until they "believe" they have found the "truth" of the "matter."

"Thank" you.

[robcon]

30. I see you gave no rejoinder, since you apparently can't think for yourself.

You've got to go to those propaganda sites for "links" since you apparently can't defend the content of anything you've linked to. Your usual 'defense' is to make some guilt-by-association mention of the Miami crowd on Cuba. Do you have any smears in mind this time, Judi Lynn?

I'll interpret your silence regarding the content of your post as an agreement that your link was mistaken and lying.

[Zhade]

33. Like people are going to believe your lies about her facts, you conservative fool.

Please, we're not stupid.

[Judi Lynn]

26. MEXICO: FARMERS BRACE FOR FLOOD OF U.S. MAIZE AND BEAN IMPORTS

December 20, 2007

MEXICO: FARMERS BRACE FOR FLOOD OF U.S. MAIZE AND BEAN IMPORTS

(English IPS News Via Thomson Dialog NewsEdge)
MEXICO CITY, Mexico, Dec. 19, 2007 (IPS/GIN) -- U.S.-grown
maize, beans, powdered milk and sugar are set to flood the Mexican
market on Jan. 1, completing a process of market liberalization
that began 14 years ago.

"The claws of free trade will grab us by the throat in 2008 and
strangle us, and the government is doing nothing about it," said
Mariano Snchez, a bean grower from a medium-sized farm near Mexico
City. "It just said it has to fulfill its pledge, but that will be
at the expense of poor farmers who can't compete."
(snip)

For a Mexican farmer, the cost of growing a hectare of maize is
300 times higher and the yield is 3.5 times lower than for a farmer
in the U.S., according to the nongovernmental National Campesino
Federation.

But every farmer in the U.S. is subsidized to the tune of an
average $20,000 a year, while in Mexico government subsidies are
no more than an annual $770 per farmer, the federation said.

More:
http://www.tmcnet.com/usubmit/2007/12/20/3180160.htm

[robcon]

31. So now you're claiming the corn willl be low priced.

Didn't your other post say that U.S. corn will be high priced????

[Judi Lynn]

32. As I've posted for well over a year, US government subsidized corn which started flooding Mexico

a long time ago swept away the native farmers' own ability to compete in their own homeland.

US taxpayer-subsidized corn sells in Mexico at prices LOWER than Mexican farmers can afford to sell it. They started being driven off their family-owned farms years ago, and the trend continues.

Open your eyes, do your own reading. Stay away from childish, rude, personal attacks. Don't get belligerent about this. It draws attention to your insecurity.

DU'ers who aren't aware of the facts can do the research needed to find the truth. That's why I always suggest it to people: don't take my word for it, just go look around personally for the information.

If you're hoping to get someone involved in a tacky scuffle, you've surely come to the wrong place.

I'm here only for a minute as I have an evening I'm sharing with husband. Evenings are always busy for many DU'ers, in case you've not noticed.

[robcon]

36. Except that your prior post says the opposite...

"Corn production for ethanol threatens to reduce corn for human consumption and raise consumer prices for Mexico's main staple food"

[AlphaCentauri]

34. and the wall? may be is part of the plan

Many more farmers will be out of work so they have to move some where and looks like the wall will prevent them from going north.

[Judi Lynn]

35. Informed LTTE published in Houston Chronicle:

Dec. 26, 2007, 10:59PM
LETTERS
Sanctuary and shuckers

Copyright 2007 Houston Chronicle

The NAFTA saga

I have a question for Bill O'Reilly and anyone else now loudly blaming "illegal immigration" for the spike in crime, unemployment, taxes — you name it. (Please see "Is Houston a sanctuary for illegal immigrants? / Horn shooting renews debate, but not all agree on what the label actually means," Page One, Dec. 23.)

Where were they when the North American "Free Trade" Agreement became the law of the land? NAFTA, predictably, has only been a bludgeon against labor standards on both sides of the border. In Mexico, the dumping of cheap U.S. corn ruined and displaced millions of farmers. And the 1995 crash of the peso ballooned that nation's debt, while killing internal development.

The saga isn't over. NAFTA mandates Jan. 1, 2008, as the final phaseout of all corn and bean subsidies south of the border, with an expected huge jump in real hunger and farm unemployment. Where will the newly immiserated come?

Let's end this travesty of mutual exploitation and establish a new pact to allow real development in our hemi-sphere. I'm waiting for a candi-date — in either party — to step forward boldly on this one.

http://www.chron.com/disp/story.mpl/editorial/outlook/5405630.html

On edit:

Some visitors to DU haven't found it possible to grasp the concept that Democrats do identify with WORKERS, with LABOR. Once they come to terms with this they probably will come to recognize why it is that real Democrats don't identify with greed, hording, and seeking cheap labor to exploit workers.