Mcbride j sergie m a 2017 pros and cons of nafta the

market share due to increased competition. ( Mcbride, J., & Sergie, M. A. 2017)
Pros and Cons of NAFTA
The NAFTA world’s largest free trade area linking 450 million people, and its member
economies generate 20.8 trillion. But do the pros outweigh the cons? ( Amadeo, K. 2017) Some
of the Pros of NAFTA are. First, the trade between the three countries has quadrupled because of
eliminating tariffs. Trade increased $1.14 trillion in 2015. Second, is lowering prices on Mexican
oil imported. This allows the U.S. to sell gas cheaper and decrease reliance on buy oil from the
Middle East. Along with the cost of gas prices being lower this keeps transportation more
affordable for food, and goods, and people. Third, U.S. has boosted growth by 0.5% a year with
three industries have increased exports: Agriculture, automotive, and health care services.
Fourth, the jobs that NAFTA has created, in the first four years after NAFTA was signed 800,000
manufacturers created jobs and due to increased exports has led to nearly 5 million new U.S.
Jobs. Fifth, foreign investments have tripled U.S. businesses invested $452 billion in Mexico and
Canada. Companies from Canada and Mexico have invested $240.2 billion in the United States
helping manufacturing, insurance, and banking companies. Sixth, NAFTA reduced government
spending because contracts became available to suppliers in all three countries. This allowed for
increased competition and lower costs for contracted services requested by the government.
(Amadeo, K. 2017)
NAFTA has also brought a lot of disadvantages that have impacted the U.S. economy.
First, it lost 500,00 to 750,000 jobs from states like California, Michigan, New York, and Texas.

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Companies in manufacturing industries moved their companies to Mexico for cheaper labor cost.
The same industries that have benefited from NAFTA and increased exports and profits were the
same companies to take took advantage of relocating manufacturing to Mexico. These industries
were motor vehicles, textiles, computers, and electrical appliances. Second, job migration has
suppressed wage increases for the American people. Sixty-five percent of companies in the
affected industries (motor vehicles, textiles, computers, and electrical appliances) threatened to
move to Mexico. This left the U.S. labor force with no ability to bargain for higher wages. The
NAFTA agreement helped the companies make more money but did not support real growth for
the American people in these industries. Third, NAFTA allowed the government-subsidized U.S.
farm products into Mexico, put Mexican farmers out of business Mexican local farmers could
not compete with subsidized low prices from the United States. Fourth, the inability to make a
living wage from farming caused Mexicans to lose their farms. To serve many had to take jobs
working for the foreign-owned factory in Mexico at which imported parts are assembled by
lower-paid workers into products for export. This was known as the maquiladora program and
gave the Mexican people sub-standard conditions for working and income. Fifth, the U.S. and
Canadian companies moved their business in they degraded the environment to keep their
spending costs low. ( Amadeo, K. 2017)
Renegotiating NAFTA