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Three

DISPLACEMENT AND MIGRATION )

Forcing People into the Migrant Stream In the years since the passage of the North American Free Trade Agreement, critics have focused on the favorable investment climate it created in Mexico for large North American corporations. They've documented the treaty's high cost in labor rights, employment, and

the environment, and the way it undermined laws and regulations pro·

tecting the social gains of working people in all thtee signatory coun- . tries, Canada, the United States, and Mexico.

Less attention has been given to the relationship between the treaty and migration. It's still a Common critique that NAFTA freed the movement of goods and capital but not the movement of people. On the one hand, this seemS quite an underestimation of the treaty's im-

pact. During the years follOwing NAFTXs implementation in I994, a greater number of people moved from Mexico to the United States than in almost any other period in our history. On the other, it seems to suggest that NAFTA should have regulated migration just as it reg-

ulated trade and investment. In the current political environment, this would more likely have led to contract-labor programs than to the free

movement of people. In the one period in which a bilateral agreement between the

United States and Mexico did regulate migration, Congress established

the bracero contract-labor program, which lasted from I942 to I964. Today similar labor programs are popular once again among politi-

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cians in washingtoh and Mexico City. International trade negotiations have begun to dis~s even more extensive schemes. The Mode 4 pro-

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posal made at the Forld Trade Organization talks in Hong Kong in 2005 would essentially create a new international guest-worker sys-

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tern, guiding the flow of migrants on a global basis to fuJfill corpo- rate labor needs. I

Trade and immigration policy, especially in the post-cold war world, are part of ~ system that produces displaced labor and puts it to use. A close relltionship does exist between US. trade and immi- gration policy, in +hich the negotiation of NAFTA played an impor- tant part. But it did not lead to greater freedom of movement for workers and farm~rs across the US.-Mexico border, nor did it give those migrants gr~ater rights and equality in the United States.

Trade negotiatibns and immigration policy were formally joined together when the p.s. Congress passed the Immigration Reform and Control Act (IRCA) in 1986. Immigrant-rights activists campaigned against the law be~ause it contained employer sanctions, prohibiting employers for the I first rime on a federal level from hiring undocu- mented workers. Ih their view, the proposal amounted to criminali2- ing work for the uhdocumented. IRC-Ks liberal defenders pointed to its amnesty provis~on as a gain that justified sanctions, and the bill did eventually enable +er 3 million people living in the United States with- out immigration 10cuments to gain permanent residence.

Yet few noted one other provision of the law. IRCA set up the Com- mission for the Stuay of International Migration and Cooperative Eco- nomic Developmeb.t to study the causes of immigration to the United States. The commission was inactive until 1988, but began holding hearings when thJ United States and Canada Signed a bilateral free trade agreement. Mer Mexican president Carlos Salinas de Gortari made it plain he flvored a similar agreement with Mexico, the com-

mission made a re~ort to the first President George Bush and to Con- gress in 1990. It fopnd, unsurprisingly; that the main motivation for coming to the United States was economic. To slow or halt this flow, it recommended "~romoting greater economic integration berween

Displacement and Migration 53

the migrant sending countries and the United States through free trade" and that "US. economic policy should promote a system of open trade." It concluded that "the United States should expedite the development of a US.-Mexico free trade area and encourage its in- corporation with Canada into a North American free trade area," while warning that "it takes many years-even generations-for sus- tained growth to achieve the desired effecy"

The negotiations that led to NAFTA started within months of the report. As Congress debated the treaty; President Salinas toured the United States, te1ling audiences unhappy at high levels of immi- gration that passing NAFTA would reduce it by prOviding employ- ment for Mexicans in Mexico. Back home he and other treaty proponents made the same argument. NAFTA, they claimed, would set Mexico on a course to becoming a first-world nation.

'We did become part of the first world," Juan Manuel Sandoval says bitterly. "The backyard."

NAFTA was part of the corporate transformation of the Mexican economy-a process that began long before it took'effect in 1994, That process moved Mexico away from nationalist ideas about development policy; which had been advocated from the end of the Mexican Revo- lution in 1920 through the 1970S.

Nationalist development became part of Mexico's official ideology in the 1930S. Nationalists advocated severing the ties most Mexicans believed held their country in bondage to its neighbor to the north. At the rime the revolution began, US. companies and investors owned oil fields, copper mines, railroads, the telephone system, great tractS of land, and other key economic resources. To be truly in.dependent, the nationalists believed, Mexico had to establish an economic system in which those resources were controlled by Mexicans and used for their benefit. The most important route to control was nationali2ation, in- tended to serve rwo purposes-to stop the transfer of wealth out of the country and to use state ownership to set up an internal market, in which what was produced in Mexico would be sold there as well. In

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theory. at least, thi government had a stake in maintaining stable jobs and income, so iliat workers and farmers could buy back what they

produced. I . Mexico, under President Lazaro Cardenas, established a corporatist

system in which obe political Party, the Party of the Mexican Revolu- tion (PRM), repr~sented, or in practice controlled, the main sectors of Mexican socieiy-workers, farmers, the military, and the "popu- lar" sector (which included government employees and professionals).

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After World War n the PRM was reorganized and became the Insti- tutional ReVOIUtiofary Party (PRI), which governed until 2000. In I939 Mexican capital and the Catholic Church organized the National Ac-

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tion Party, which finally came to power six decades later. PRI governmJts administered a network of social services. The

social security sys~em, IMSS, established in I943, provided healthcare, while the governfuent housing corporation, INFONAVIT, set up in I972, built homes! The Mexican Constitution guaranteed economic

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and social rights, in addition to political ones, in a way the u.s. Con- stitution does notj Under Cardenas, Mexico expanded the land reform begun in I917, and redistributed haciendas in many parts of the coun- try. although sorrle vast cattle ranches and other landholdings were left intact. Land +as considered the property of the whole country.

and thousands 0tejidOS, or farming communities, were created, in which farmers, 0 ejidatarios, held the land they worked in trust. They could not legally ell, rent, or misuse it. Most foreign ownership of land was prohibit~d.

Cardenas also hationalized Mexico's most important resource- oil-in a popul~ nationalist campaign. Even schoolchildren were encouraged to donate pennies to help compensate foreign corpora- tions for the exprbpriation of their holdings. National ownership of oil, and later eledncal generation, was written into the Constitution. Land redistributi6n and nationalization had a political as well as eco- nomic purpose-fue creation of a section of workers and farmers who could be depend6d upon to defend the government and its political party, into whichl their unions and producer organizations were in- corporated.

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After World War II, Mexico officially adopted a policy of industri- alization through impOrt substitution. In this development strategy. enterprises were created or supported that produced products for the domestic market, while imports of those products were restricted. The purpose was to develop a national industrial base, prOvide jobs, and increase the domestic market. '

Under that policy large state-owner enterprises eventually em- ployed hundreds of thousands of Mexican industrial workers in mines,

mills, transportation, and other strategiC industries. It was not a so- cialist economy-large capitalist enterprises thrived. But for a while, the policy prOvided economic security to many workers and farmers. Foreign investment was limited, although after Cardenas much Mex- ican capital operated in increasingly close parmership with u.s. and Canadian corporations. Enrique Davila, professor at San Diego City College and the Autonomous UniverSity of Baja California, summa- rizes that growing contradiction as "nationalism in rhetoric, selling out the country in practice."

Under successive PRI administrations, a vaSt gulf grew between those who were integrated into the formal s'ector, and farmers and in- digenous communities who remained at the social margin, especially in the south. An even greater gulf widened between the political and economic elite, who managed the state's assets and controlled gov- ernment policy, and workers and farmers in general. To protect this elite, the country's political system became increaSingly repressive, especially toward those who wanted an independent political voice. Nationalist rhetoric often covered political crimes. Defense Minister Marcelino Garcia Barragan, almost certainly on the orders of Presi- dent Gustavo Diaz Ordaz, called out the army and killed hundreds of protesting students at Mexico City's Tlatelolco Plaza in I968. Later, President Luis Echevarria conducted a so-called dirty war against Mex-

ican leftists-in which hundreds were kidnapped, tortured, and "dis- appeared" -all while pursuing a "nationalist revolutionary" policy, as it was called in the official language.

Contradictions in Mexican development became sharper in the I970S. To finance growth while the price of oil was high, Mexico

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opened up its finaidal system to foreign capital (mosdy from the United States), and ine country's foreign debt soared. State enterprises still belonged to th~ government formally, but in effect were hocked by their managers ~o banks. Instead of plowing loans into modern- ization and effideht production, the money often wound up in offshore bank accmlnts. Managers of state enterprises like the oil com- pany PEMEX ran phvate businesses on the side, along with politically

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connected union offidals. Rackets and corruption proliferated while labor and campesiJo leaders who challenged the system were impris-

oned or worse. I Meanwhile, in die 1960s, the first big dislocations from the coun-

trySide began. Ciucfud Netzahualc6yod at the edge of Mexico City be- came one of the w6rld's largest slums, populated largely by uprooted farmers. The move±nent of people across the border with the United States grew as well! .

The accumulatiqn of debt, and the hold it gave to foreign finandal interests over the Mexican economy, spelled the end of nationalist de- velopment. Oil prides fell, the US. Treasury jacked up interest rates, and in 1982 the systb collapsed when Mexico could no longer make debt payments. Th~ government devalued the peso in what is still in- famous as the grea~ "peso shock." Agustin Ramirez, studying to be an agronomist at the university in Michoacan at the time, remembers that "the value of tie peso went from twelve to the dollar to five hun-

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dred sixty to the dollar in six months. The government not only froze jobs, but started laYmg people off. My promised job went down the drain. So if I had tel choose between being poor in Mexico and poor in the US., it was bbvious where I should go." The cutoff date for amnesty under IRCk, January I, 1982, was timed to give legal status to those who came pior to the devaluation in February, but not to the huge wave displaced by the shock itself.

The "nationalist" commitment to popular welfare was already more rhetoric than reality by the 1980s. In the Constitution, Mexicans still had the right to housing, healthcare, employment, and education, but millions of people went hungry, had no homes, were sick and un-

Displacement and Migration 57

employed, and couldn't read. The anger and cynicism felt by many

Mexicans toward their political system is in great part a product of the contradiction between those constitutional promises of the revolu- tion a century ago, plus the nationalist rhetoric that followed, and the reality of life for most people.

The crisis was an opportunity for the PRI to weaken that rhetorical commitment even further. In a deJerate attempt to generate jobs and revenue for debt payments, the government encouraged the growth of maquiladoras, first permitted under the Border Industrial Program,

begun in 1964. To develop the northern border region, the govern- ment had allowed fOreign corporations to build assembly plants within a hundred miles of the United States. The raw materials had to come from the US. side, and all the finished products had to go back north as well.

From 1982 to 1988 the number of border factories tripled, from five hundred to fifteen hundred, the number of workers they employed went from 150,000 to 360,000, and they accounted for 40 percent of Mexico's total exports. Encouraging their growth set a process into motion in which today more than three thousand border plants em- ploy more than 2 million workers making products for shoppers from Los Angeles to New York. By 1992, the year before NAFTA took effect, they accounted for over half of Mexican exports, and in the NAFTA era maquiladoras became the main sector of the economy producing employment growth.

Maquiladora development encouraged foreign inveStment at almost any cost. It undermined the legal rights of workers and communities in the border area and the enforcement of environmental protections or other laws that could be viewed as discouraging investment. Mex- ico's future, in the eyes of the technicians who were reordering its eco- nomic priorities, lay in producing for the US. market rather than for consumers at home, whose income, after 1982, could not support much domestic demand anyway. That gave the government a grow- ing interest in keeping wages low as an attraction to foreign invest- ment, instead of high enough that people could buy what they were

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making. Other incenlives to investors included a political structure in which official unioru! controlled restive workers rather than organiz· ing them to win bettbr conditions.

Protecting investdrs required changes in the system of land own- ership, since comparhes were reluctant to invest in factories or other productive enterprisbs if their tides could be challenged under land reform and land tenahcy laws. Salinas pushed through a drastic change

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in Article 27 of the Mexican Constitution, which had guaranteed land refo= and establish~d the ejido system. After the change, ejidos could

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sell land, and many did. About three thousand of thirty thousand eji- dos were legally conierted into co-ops, condominiums, parmerships,

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sociedades anonimas (Mexican private businesses), and joint-stock com- panies. It became a dune for landless people to setde and build homes on vacant federallanlis. Reforms began the reconcentration of land in the hands of wealiliy investors and agricultural companies, while many ejidatarios becabe agricultural wageworkers or left for the cities.

As a result of t~g control of banks in the I982 crisis, the Mexican government becam~ the owner of foreclosed assets, which included mines and other priv~te businesses. It quickly began to sell these prop- erties off. By the eJly I990S Mexico had sold not just mines to the Larreas, but its steel bm in Michoacan to another elite family, the Vu- lareals, and its telepH.one company to the Mexican businessman Car- los Slim Helti. Fo=6: Mexico City mayor Carlos Hank Gonzalez, who controlled the CONksupo trucks and warehouses, drove the city's bus system deeply clto debt and then bought the lines in the I990S at public auction. Mexibo created a whole new stratum of billionaires in

thi~:~~cans wLen't the only beneficiaries of privatization. US. companies were all6wed to own land and factories, eventually any- where in Mexico, wiiliout Mexican parmers. US.-based Union Pacific,

in parmership with ~e Larreas, became the owner of the country's main north-south rrw line, and discontinued virtually all passenger service, since it was less profitable than moving freight. As the Larreas and Union Pacific bdosted profits and cut labor costs, Mexican rail em-

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ployment dropped from over ninety thousand to thirty-six thousand. In the I950S the railroad union, under left-wing leaders Demetrio Vallejo and Valentin Campa, had been so strong that its strikes rocked the government. The two were punished with years in prison. But when railroad workers mounted a wildcat strike to try to save their jobs from privatization, they lost and their union's presence in Mexi- can politics became a shadow. J .

After NAFTA the privatization wave expanded. Mexico's ports were sold off, and companies like StevedOring Services of America, Hutchi- son Port Holdings (HPH), and TMM now operate the country's larg- est shipping terminals. The impact on longshoring wages was devastating. In Manzanillo and Lazaro Cardenas, the twO largest Pacific Coast ports, a crane driver made $IOO to $I60 a day before pri- vatization in the late I980s. Today crane drivers make $40 to $50.

Slashing wages in privatized enterprises and gutting union agree- ments only increased the wage differential between the United States and Mexico. According to Garrett Brown of the Maquiladora Health and Safety Support Network. the average Mexican wage was 23 per- cent of the US. manufacturing wage in I975. By 2002 it was less than an eighth, according to Mexican economist and former senator Rosa Albina Garabito. Former United Auto Workers representative Steve Beckman says that after the I98I debt crisis the Mexican average dropped to a twelfth or fifteenth of that in the United States, depend- ing on the industry-even during a period in which US. wages de- clined in buying power. Brown says that in the twelve years after NAFTA went into effect, real Mexican wages dropped by 22 percent, while worker productivity increased 45 percent.

Low wages are the magnet used to attract US. and other foreign investors. In June 2006, Ford Motor Company, already one of Mex- ico's largest employers, announced it would invest $9 billion more in building new factories. Meanwhile, Ford said it was closing at least fourteen US. plants, eliminating the jobs of tens of thousands of work- ers. Both moves were part of the company's strategic plan to stem losses by cutting labor costs drastically and moving prodUction.

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All these economic changes displaced people. This tOO is part of a long historical process. P~ople were migrating from Mexico to the United

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States long before NfFTA was negotiated. Juan Manuel Sandoval em- phasizes that "Mexican labor has always been linked to the clifferent stages of US. development since the nineteenth cenrury-in times of prosperity by the intorporation of big numbers of workers in agri- culrural, manufacrufng, service, and other sectors, and in periods of economic crisis by die massive deportation of Mexican laborers back

to Mexico:' I From I982 through the NAFTA era, successive economic reforms

produced more migtants. Ejidatarios who could no longer survive as farmers found jobs las farmworkers in California. Laid-off railroad workers traveled north, as their forebears had during the early I900S, when Mexican labo~ built much of the rail nerwork through the US. Southwest. Again, die displacement of people had already grown so

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large by I986 that IRCA established a commission charged with rec- ommending measurbs to halt or slow it. .

The [RCA commission's report urged that "migrant-sending coun- tries should encourake technological modernization by strengthening and assuring intellectual property protection and by removing existing impediments to inve~tment:' It recommended that "the United States ... condition bilate~f aid to sending countries on their taking the necessary steps toward structural adjustment. Similarly, US. suppOrt for non-project lenlling by the international finanCial instirutions should be based onlthe implementation of satisfactory adjustment programs:'

Beginning arouna I980, the World Bank and the IMF began im- posing a one-size-fitJ-all formula for development, called strucrural ad- justment programs. I These required borrowing countries to adopt a package of economic reforms, such as privatization, ending subsidies and price controls, trade liberalization, and reduced worker protec- tions. After more mkn rwo decades, there is no strong evidence that

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this approach has achieved its stated goal of stimulating growth, while the toll on workinglpeople has been staggering. The IRCA commis-

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sion report acknowledged the potential for harm by noting that "efforts should be made to ease transitional costs in human suffering."

The North American Free Trade Agreement, however, was not in- tended to relieve human suffering. Mexico hoped to negotiate a com- mercial treaty, to gain access to U.S. markets for Mexican goods and raw materials, which had often feen barred by protective tariffs im- posed by the US. Congress. The United States and Canada sought, On their part, to make it easier for foreign companies to move money and goods across the border, to invest in Mexico, and to protect that in- vestment. But in I994, the year the treaty took effect, US. speculators began selling off Mexican government bonds. According to Jeff Faux, founding director of the Economic Policy Instirute, "The peso crash of December I994 was directly connected to NAFTA, which had cre- ated a speculative bubble for Mexican assets that then collapsed when the speculators cashed in:'

The government devalued the peso, trying to prevent a flood of money back to the north, but also allowed bankers to freely exchange pesos for dollars. As businesses tried to repay debt with pesos worth only half as much, bankruptcies spread. According to Harvard history professor John Womack, the old "nationalists:' many now private bil- lionaires, took control of government policy. In the enSuing political crisis, the new president, Ernesto Zedillo, made a deal with US. trea- sury secretary Robert Rubin. Goldman Sachs and New York and Span- ish banks took control of the Mexican banks, and were guaranteed payment for refinancing Mexico's debt. '1 think about eighty percent of Mexico's finances now runs through New York and London," says Womack, "The new Mexican government surrendered, conceded, and abandoned all the protections for Mexican businesses and producers." The arrangement negotiated with Rubin, he says, "was much more about finances than about trade, much more about the movement of capital, the creation of debt and derivatives, and the pursuit of specu- lation than about the movement of commodities:'

The US. government guaranteed the bailout, and in rerum Presi- dent Bill Clinton demanded that Mexico use oil exports to guarantee debt payments to the banks. Mexico had histOrically used its oil in-

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come to finance gov~nment expenditures, keeping taXes =emely low for businesses add the wealthy; while starVing the state oil com- pany PEMEX of capital for modernization and expansion. Using oil income to pay debt clade matters even worse. In 2006 Manuel L6pez Obrador, the PRD' s Ipresidential candidate, said he would ease the pressure on Mexicans to migrate by raising the income of the poor in the countryside. But ~ven if a popular government had been elected, as seemed possible that year, it would not have had Mexico's main

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source of income available for alleviating poverty; granting rural loans, rescuing dilapidated ~Ocial security clinics, or raising teachers' salaries and building more schools in Oaxaca.

Mexico lost a milliimjobs, by the government's own count, in I995· That experience waJ repeated in 2000-200I, when recession in the United States, and th~ decline in consumer purchasing, led to the layoff of over four hundredlthousand workers in the maquiladoras. NAFTA became an accelerant, pouring gasoline on the fire of economic re- form. Instead of creating prosperity; it displaced workers and farmers

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The economic reform process required the Mexican government to dissolve the CONAiSUPO stores. Mexican subsidies to farmers were

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ruled illegal, althoug]J. the US. continued paying huge subsidies to its largest growers unde~ the provisions of the US. farm bill, while buy- ing enormous quantities of farm commodities. At the same time, CONASUPO's state-b Stores were held a barrier to the entry of pri-

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vate companies into the retail grocery business. The ability of us.lproducers to grow com cheaply using intensive

industrial methods affected Mexican growers long before NAFTA. In the I980s Mexico becbe a com importer, and according to Sandoval, large farmers swit~ed to other crops when they couldn't compete with US. grain dumping. But with no price supports, hundreds of thousands of small farmers found it impossible to sell com or other

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farm products for what it cost to produce them. And when NAFTA pulled down customls barriers, large US. corporations dumped even more agricultural pfoducts on the Mexican market. Rural families

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went hungry when tj:ley couldn't find buyers for what they'd grown.

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It's no accident that the Zapatista National Liberation Army, based in poor indigenous communities in Mexico's southernmost state, Chia- pas, planned the beginning of an armed rebellion for the day NAFTA took effect. The Zapatistas knew what would happen to indigenous communities in the southern countryside. And the final elimination of tariffs on white com, beans, and other farm goods on January I, 200S-the implementation of NAFTA:s final chapter-was greeted by demonstrations across Mexico.

Mexico couldn't protect its own agriculture from the fluctuations of the world market. A global coffee glut in the I990S plunged prices below the cost of production. A less entrapped government might have bought the crops of Veracruz farmers to keep them afloat, or provided subsidies for other crops. But once free market strictures were in place, those farmers paid the price instead. Veracruz campe- sinos joined the stream of workers headed for the Smithfield plant in North Carolina and points beyond.

Poor people in the cities fared no better. Although a flood of cheap US. grain was supposed to make consumer prices go down, the op- posite occurred. With the end of CONASUPO and price controls, the price of tortillas more than doubled in the years that followed. Higher prices intensified urban poverty; increasing the pressure to migrate. One company; Grupo Maseca, monopolized.tortilla production. On its board of directors are Federico Gorbea Quintero, president of Archer Daniels Midland Mexico, and Ismael Roig, ADM's vice president for planning and business development. (ADM is one of the United States' largest com producers and processors.) Carlos Hank Rhon, whose family formerly controlled CONASUPO, is now also a Grupo Maseca director. Meanwhile, Wal-Mart has become Mexico's largest retailer.

Under its former development policy; foreignautomakers like Forc\, Chrysler, General Motors, and Volkswagen had been required to buy some of their components from Mexican producers. Workers labored

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in the parts plants that produced them. NAFTA forbids governments from requiring foreign investors to use a certain percentage of local content in their production. Without this restraint, the auto giants began to supply their assembly lines with parts from their own sub-

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sidiaries, often manufactured in other countries. Mexican parts work- ers lost their jobs by the thousands.

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"The financial crashes and economic disasters drove people to work for dollars in the U.S.! to replace life savings, or just to earn enough to keep their family at Home together," Womack says. NAFTA didn't re-

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duce migration, as the IRCA commission predicted. Following the 1994 crisis, it produc~d it.' More than 6 million Mexicans came to live in the United States lin the thirteen years after the treary went into effect. In just five years, from 2000 to 2005, the Mexican population living in the United States increased from ro to 12 million, and the gov- ernment predicted ruhnual migration would soon reach four hundred thousand per year. With few green cards, or permanent-residence visas, available for Mbacans, most migrants were undocumented.

The Sensenbrenm,r Family Business Economic reforms ahd NAFTA made a small group of investors in both Mexico and th~ United States rich, or richer. But when people were displaced by rWs process, where were they supposed to go?

Not to the United IStates. At least, not according to Wisconsin con- gressman James Sedsenbrenner. In December 2005 Sensenbrenner

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convinced his Republican colleagues (and, to their shame, thirry-five Democrats) to pass ohe of the most repressive immigration proposals of the last hundred ybars. His bill, HR 4437, would have made federal felons of all 12 rnilliorl undocumented immigrants in the United States, criminalized teacherl, nurses, or priests who helped them, and built a seven-hundred-mil~ wall on the U.S.-Mexico border to keep people from crossing. The bm never passed the Senate, but its wide margin of approval in the Hou~e was a vivid demonstration of how deep con- greSsional anti-~rant hysteria had become.

Representative Sehsenbrenner is more than just a leader of con- gressional xenophobbs, however. His family is intimately involved in creating the conditiohs that cause migration, and they profit from the labor it makes availaBle. The family's connections, in miniature, reflect

'" poll"," '00'1" _,ti •• ruclf.

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The Kimberly-Clark Company was incorporated in 1906, andJames Sensenbrenner's grandfather Frank became its head in 1907. It became one of the world's largest paper companies, and the family trust remains an inrportant stockholder. The company's Mexican coun- terpart, Kimberly-Clark de Mbdco, is a close associate of the Mex-

ican mining giant Grupo Mbdco. One of KC's former executives, J. Eduardo Gonzalez, is Grupo Mbdco's chief financial officer. (An- other Grupo Mexico board member, Luis Tellez Kuenzler, sat on the board of the Carlyle Group, which included former preSident George H. W Bush. Kuenzler resigned to become secretary of com- munications and transport in the Calder6n administration after the 2006 election.)

In 1998 Grupo Mexico provoked the strike in Cananea that cost more than eight hundred miners their jobs. Many were blacklisted and left for Phoenix and Tucson. In 2006 the mining giant did the same

thing at Nacozari, and twelve hundred more were permanently dis- charged, replaced by workers brought from southern Mexico. With the border just a few miles north, they too had no alternative but to cross it to survive. Those terminations, replacements, and busted unions successfully cut labor costs while world copper prices were climbing. Company profits increased.

During the months when N acozari mining families set out on their journey north, Congressman Sensenbrenner organized a series of rump congressional hearings on the other side of the border to defend his immigration proposal. As he and his Republican allies toured various U.S. cities, they fulminated against the undocumented, de- claring they had no place in the United States and should leave. If they didn't, his bill would send them to federal prison. In order to house those detained crossing the border without papers, contracts to build new detention centers had already been given to Halliburton Cor- poration, the company formerly headed by/U.S. vice president Dick Cheney.

One of those hearings took place in Arizona, but no one invited any of the N acozari Or Cananea miners to testify. No reporter Or politi- cian asked Sensenbrenner where he thought they should go, or if the

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family's business associates bore some responsibility for their dis- placement and subs~quent migration.

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Other voices in Congress criticized the congressman's draconian bill, arguing that th~ labor of migrants was needed in the US. econ- omy. Some 24 millio~ immigrants live in the United States with doc- uments, and I2 milli6n without them. If they all actually did go home, whole industries WOfWd collapse. Some of the country's largest cor- porations, complete! dependent on the work of immigrants, would go bankrupt.

One of these dependent corporations is the Sensenbrenner family business. Every year,lKimberlY-Clark converts tons of wood pulp into a leading brand of toilet paper and sells it in supermarkets around the world. Deep in US. rorests, thousands of immigrant workers plant and tend the trees tliat produce that pulp. Every year, laborers from Mexico, Central Arrlerica, and the Caribbean are recruited for this job. In towns like d Democracia, Guatemala, where the global fall

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in coffee prices has driven families to the edge of hunger, recruiters promise jobs paying bore in an hour than a coffee farmer can make in a day. They offer io arrange visas to come to the United States as guest workers, and fo~ their services charge thousands of dollars. Hun- gry families mortgage homes and land JUSt to put one person on the

airplane north. I In the United States, recruiters hand the workers over to labor con-

tractors. They; in nuh, work for land-management companies, who tend the forests for ilieir owners. The landowners grow the trees and sell them to the pape~ companies. No worker gets overtime, regardless of the law. Companies charge for everything from tools to food and hOUSing. Griest work~rs are routinely cheated of much of their pay. If they protest, they're ~ut on a blacklist. Protesting wouldn't do much good anyway. The US. Department of Labor almost never decertifies a guest-worker contr1actor, and says the blacklist is legal.

The paper induscrr depends on this system. Twenty years ago, it stopped hiring unemployed workers domestically and began recruit- ing guest workers. Ali a result, labor costs in the forests have remained

Displacement and Migration 67

flat, while paper profits have soared. The low price of labor allows landowners to sell their trees for less, and Kimberly-Clark profits from the result.

In Latin America, economic reforms promote4 by the US. govern- ment through trade agreements and international financial institu- tions displace workers, from miners to coffee pickers, who join a huge flood of labor moving north. When displaced workers arrive in the United States, they become an indispensable part of the workforce, whether they are undocumented or labor under work visas in con- ditions of virtual servitude. Displacement is creating a mobile work- force, an army of available workers that has become an integral part of the US. economy.

The same system that produces migration needs and uses that labor. Despite the claims of the IRCA commission and NAFTKs pro- ponents, one of the most important effects of the treaty and of struc- tural adjustment policies in general is the production of migration. "The economic interests of the overwhelming majority of [U.S.] em- ployers favor borders as porous for labor as possible," the Economic Policy Institute's Faux says. But labor must arrive in a vulnerable, second-class status, at a price they want to pay.

The US. immigration debate needs a vocabulary that describes what happens to migrants before they cross borders-the factors that force them into motion. In the US. political debate, people like the miners or pine tree planters are called job seekers, not political refugees. But when teachers and farmers in Oaxaca were beaten in the streets for protesting the fact that their state's government can't and won't provide a viable economic future, and then had to leave southern Mexico as a result, they became both job seekers and refugees.

It would be more accurate to call these people migrants, .and the process migration. The miner fired in Cananea or Nacozari is as much a victim of the denial of human and labor rights as he or she is a per- son needing a job in the United States to survive. But in the United

68 Illegal People

States and other weaIthy countries, economic rights are not consid- ered human rights. IIi this official view, hunger doesn't create political refugees. The whole fro cess that creates migrants is scarcely consid-

ered in the U.S. immigration debate. The key part of tfuat process is displacement, an unmentionable

word in the Washington discourse. Not one immigration proposal in

Congress in 2006 and\2007 tried to come to grips with the policies that uprooted miners, teaChers, tree planters, and farmers, in spite of the fact that members ofl Congress voted for these policies. In fact, while debating bills to criminalize migrants in 2007, four new trade agree- ments were intrOducfd, each of which would cause more displace-

ment and more migration. I

No speeches on me House or Senate floor connected the dots, or explored real alte~atives that would protect jobs and rights for working families rega!rdless of what country they were born in. This is a kind of wilIful i~orance, in which flawed policy assumptions are treated as obviou~ truth and repeated endlessly in a skewed pol- icy debate: "Trade a~ements are needed to help increase investment abroad,N despite the Ippenly predicted "transitional cost of human suffering." "Economic reforms and foreign investment create jobs and prosperity.·· ''Im.nligration should be regulated to ensure that cor- porations in the Unit~d States have an adequate labor supply:"

Underlying these a~sumptions, however, is a harsh unspoken real- ity. Whether acknowl~dged or not, displacement has been indispen- sable to the growth 6f capitalism from the beginning. As early as the <700S, the English lenclosure acts displaced villagers by fencing off the commons where iliey raised sheep for wool. Together with cottage

I

weavers who wove that wool into cloth, herders were driven by hunger into the new tbrue mills. There they became the world's firSt wageworkers. Labo~ on the new industrial looms, they produced the wealth of the £rit British factory owners and became the first

members of the Briti& working class. When Karl Marx dalled Africa of the eighteenth and nineteenth

cenruries "a warren fdr the hunting of black skins," he was describing the bloody and force~ displacement of indigenous communities by

Displacement and Migration 69

the slave traders. Uprooted African farmers were transported in chains to the New World, where they became an enslaved plantation work- force from Colombia and Brazil to the U.S. South. Their-labor created much of the wealth that made the growth of capitalism possible in the United States and throughout the Americas. /

Displacement and enslavement produced more than wealth. As slave owners sought to differentiate slaves from free people, they de- veloped and refined racial categories. Skin color and place of origin were used to divide sociery into those with rights and those without them, who became properry themselves. When Mr. Sensenbrenner called modem migrants "illegals," he used a category whose roots go back to these divisions, and the system of unequal status they cre- ated. Displacement and inequaliry are just as much part of today's eco- nomic system as they were at its birth in the slave trade and the enclosure acts.

In the global economy, people are displaced because the economies of their countries of origin are transformed, to enable corporations and national elites to transfer wealth Out. After World War II, the for- mer colonies of the United States, Europe, and Japan sought to stop that expOrt of wealth. From Iraq to Tanzania to the Philippines, they embraced national economic development plans like Mexico's, to en- courage industries and enterprises producing for their own people. The economic reforms that followed the end of the cold war, imposed by wealthy countries and institutions like the World Bank and the IMP, destroyed those systems of national development.

An unjust order inspires rebellion and movements to change it, however, like the Zapatistas in Chiapas or the teachers in Oaxaca. In EI Salvador, Guatemala, and Nicaragua, when people tried to upend that social order, they confronted not just the armies of their own elites but, often, U.S. military intervention. Those wars also produced

displacement and migration. At the end of his paean to late-twentieth-century capitalism, The

Lexu.s and the Olive Tree, the New York Times correspondent Thomas Friedman makes clear the reason those wars were fought. "Markets function and flourish only when properry rightS are secure and can be

70 Illegal People

enforced, which, in rum, requires a political framework protected and backed by military po~er,,, he says. "Indeed, McDonald's cannot flour- ish without McDonnell Douglas, the designer of the u.s. Air Force F-15. And the hidden fi~t that keeps the world safe for Silicon Valley's

I

technologies ro flourish is called the U.S. Army, Air Force, Navy and

Marine Corps. And thJse fighting forces and institutions are paid for by American taxpayer dollars."

Smedley Buder, the Marine major general who led u.s. interven- tions in China, Central America, and the Caribbean from the rum of

the century to the 1930f' said it better. In a 1935 article for the radical magazine Common Sense, he recalled, '1 spent 33 years and four months in active military servibe and during that period I spent most of my time as a high class mJscle man for Big Business, for Wall Street and

I

the bankers. In short, I was a racketeer, a gangster for capitalism. I

helped make Mexico aid especially Tampico safe for American oil in- I

terests in 1914. I helped make Haiti and Cuba a decent place for the National City Bank bots ro collect revenues in. I helped in the raping

of half a dozen Centrhl American republics for the benefit of Wall

Street. I helped purify 1icaragua for the International Banking House of Brown Brothers in 1902-1912. I brought light to the Dominican Re- public for the Americah sugar interests in 1916. I helped make Hon-

duras right for the AmJrican fruit companies in 1903. In China in 1927 I helped see to it that Stbdard Oil went on its way unmolested. Look-

I

ing back on it, I might have given Al Capone a few hints. The best he could do was ro operat~ his racket in three districts. I operated on three continents."

Migrant Labor: An Indispensable Part of a Global System Although displaced pe6ple are an indispensable and growing part of

the workforce in this +w world order, not all cross borders. The ex- plosive growth of export processing zones (EP2s), where maquiladora

factories produce for ciport, depends on migrant labor.

The creation of the priginal maquiladora program, the Border In- dustrial Program, on the U.S.-Mexico border in I964, was conceived

Displacement and Migration 71

as a way to absorb thousands of unemployed contract laborers, who

had been working in the United States during the twenty-two-year run of the bracero program. To avoid social unrest, the Mexican gov-

ernment needed to find jobs for those workers. T~ atrract employers, it changed laws that had prohibited direct U.S. ownership of factories in Mexico, allowing invesrors ro build plants taking advantage of lower Mexican wages, producing goods for the U.S. market. A new labor regime was put in place to atrract foreign investment, including the

brutal repression of independent unions or challenges to the low-wage model.

Measures to pull workers north to the border were just as neces- sary Over the nexT four decades the maquiladora workforce was

drawn from the south. Migrants were displaced by the same economic changes-privatization, rural poverty, job elimination-that permit- ted construction of the maquiladoras themselves. Cities like Tijuana, Mexicali, Juarez, and Matamoros, which were not much bigger than large towns in the 1950S, mushroomed into cities with millions of in- habitants.

Prior to the economic reforms, the U.S. -Mexico border was a re- mote area, with a very low population, far from Mexico's industrial base and workforce. Without the simultaneous dislocation of workers

from privatized or bankrupt state-owned factOries, or farmers from southern Mexico's impOVerished countrySide, there would have been

no workers available to make maquiladora development possible.

This development model has since been reproduced in developing countries all over the world. In the early 1990S the U.S. Agency for International Development (USAID) financed the construction of in- dustrial parks, or export processing zones, in rural Honduras. It then contracted with the accounting firm of Price Waterhouse to study

ways of producing workers for their new factOries. In I993 the com-

pany prepared a report for USAID that concluded, "EP2's labor de- mands could not be met by natural population growth." Satisfying labor needs, it said, required "an increase in the labor participation

rates of young women." Many of those young women are at the point

in their lives where they want to begin their own families. Price Wa-

~

72 illegal People

terhouse noted wiJ disapproval that "the pregnancy rate among women of childbe+g age was 4% in June I992, up from 2.5% six months earlier. This lis regarded as too high (3% would be the maxi- mum acceptable)." It recommended mandatory distribution of con-

I

traceptives, and said a similar program in Mexican maquiladoras "claims spectacular r~sults in higher productivity; lower staff turnover and training costs, reauced absenteeism and reduced costs for mater- nity leave ... and meducal care." .

Its mOst startling ~ecommendation noted that the percentage of women under twenty-one had risen from a third to half the work-

1

force. One table showed the employment rates of workers age ten and over. Another showea that children between the ages of ten and four- teen made up I6 perhent of the women either employed or seeking jobs. A footnote claJned "the legal minimum working age in Hon- duras is IS, but in th~ rural economy it is normal to work from ten

,

onwards." The poverty that I drove these young women into the plants in

Honduras and Mexico is the same poverty that drives them to cross borders. Poverty caJses displacement and migration. Maquiladora workers often become migrants traveling far beyond the nearest EPZ.

I

And when the maquiladoras are located a stone's throw from the bor- der, crossing it is almost inevitable.

Migrant labor is e..J..en more important in developed countries. US. industrial agricultur~ has always depended on immigrants. The farm

I

labor workforce in the US. Southwest was formed from waves of I

Chinese, Japanese, FfPinOS, Mexicans, and, more recently, Central Americans. During the years before world War II it also included native-born workersl from Texas and Oklahoma, economically dis- placed in the Great gepression. Today a growing percentage of farm- workers are indigenous people from Mexico and Central America, speaking languages 6ther than Spanish, an indication that economic dislocation has reacHed far into the most remote parts of the coun-

I

tryside. On the U.S. East Coast, migrants come from the Caribbean, and join large numbbs of African Americans displaced from rural, or

b I.. .

even ur an, commumtles.

Displacement and Migration 73

In other industrial countries a rising percentage of the rural work- force is also made up of migrants. Industrial agriculture, based on mi- grant labor, has expanded to developing countries, where plantations owned Or controlled by large corporations like Dole and Del Monte

draw a workforce from displaced rural cOlllnJlmities. In Colombia up- rooted AfrO-Colombians are drawn into nurseries growing flowers for U.S. supermarkets, or plantations growing palms for biodiesel fuel. In northern Mexico, vast industrial farms grow winter tomatoes and strawberries for US. consumers, drawing on families migrating north from Oaxaca.

Migrants are now a vital part of the service industry workforce in most developed countries. As the most recent job seekers, they begin

in the most marginal and contingent jobs. Day laborers on Los Ange- les or Long Island street corners arrive from Mexico and Central America. In Britain they come from Romania and Africa.

But migrant labor doesn't remain at the fringe of the economy. The world's oil industry is completely dependent on it. The oil kingdoms of the Gulf states-Kuwait, Qatar, Bahrain, Abu Dhabi-have many more immigrant workers than native-born ones. Migrant workers, in other words, make the. world's vital oil industry function. It was n6 coincidence that HallibUrton brought migrants from Bangladesh and the Philippines into Iraq in the wake of the advancing US. invading force in 2003, intending to use them to replace Iraqi workers on the oil rigs and pipelines. Only a strike by Iraqi oil workers forced Hallibur- ton to retreat, and prevented the company from taking control of their industry.

Employers gain great advantages from this system, particularly lower labor COSts and increased workforce flexibili;y. Large meat-

packing companies in the US. Midwest, for instance, hire a workforce in which immigrants are a majority. Over the last twenty years, the in- dustry's wages have steadily fallen behind the manufacturing average, a major accomplishment from the companies' point of view. Accord- ing to the Bureau of Labor Statistics, I980 slaughtering-plant wages were I.I6 times the manufacturing average. Afrer rwenty-five years, they are now ·76 times that average. U.S. manufacturing wages cer-

74 illegal People

I

tainly haven't soared-in fact, they've fallen behind inflation. But meat- packing wages, in rblative terms, have fallen faster.

A steady stre~ of migrants crosses the border, finds its way to small meatpacking towns, and gets jobs. Companies depend on this river of labor-not just on the workers in the plants themselves, but on the communities from which they come. If those communities stop producing wotkers, their labor supply dries up.

But the cost of providing new generations of workers from tiny Mexican and Guatbalan towns is not borne by the employers who

I

need and use the labor. At the same time, the government budget for healthcare or educltion in those home communities shrinks because of. debt paymentsl and economic reforms. In Guatemala's Santa Eulalia, which supplies workers for Nebraska slaughterhouses, the government does Aot provide any healthcare system for the town's residents. In its sch60ls, parents and teachers must buy paper, pencils, books, and other ritaterials-universally true throughout rural Gua- temala. When Sanl Miguel Cuevas, a small Minec town in Oaxaca, needed a new road from the main highway, it couldn't expect a gov- ernment crew to ~uild it. San Miguel residents, now mostly farm- workers in Califorlua, built the road themselves, contributing labor and money through the indigenous tradition of the tequio, or com-

munal responsibilitr. When the IRCAlcommiSsiOn on migration said Mexico should take

"the necessary steps toward structural adjustment," and that loans to its government "s~ould be based on the implementation of satisfac- tory adjustment pr6grams," it was proposing deep cuts in government spending. As a result of those recommendations, workers themselves now bear the cost 6f almost all basic sodal services in towns sending

I

migrants to the United States. They pay for them through remirtances sent back from jobJ in Nebraska slaughterhouses, California fields, and New York hotels. As stated previously, in 2005 then Mexican president Vicente Fox boaste:d that his country's dtizens working in the United States sent back $IS billion. Some estimate that in 2006 that figure

reached $25 billionl.

Displacement and Migration

At the same time, the public funds that used to pay for schools and public works leave Mexico in debt payments to foreign banks. Remit- tances, as large as they are, cannot make up for this -outflow. Accord- ing to a repon to the Mexican Chamber of Deputies, remittances accounted for an average of I.I9 percent of ;the gross domestic prod- uct between I996 and 2000, and 2.14 percent between 200I and 2006. Debt payments accounted for 3 percent annually. By partially meeting

unmet, and unfunded, sodal needs, remirtances are indirectly subsi- dizing banks.

Companies that employ migrant labor in the United States benefit from the huge flow of remittances as well. Meatpacking wages are low, in US. terms. When workers send money home to their families thousands of miles away, the COSt to employers of sustaining them is much lower than it would be if they were living in Iowa or Nebraska. In the United States, employers don't have to pay as much in taxes to suppon local schools Or services for workers whose families are else- where. In Mexico or Guatemala they don't have to pay taxes at all to prOvide those services for workers' families.

At the same time, companies dependent on this irnmigray.t stream gain greater flexibility in adjusting for the highs and lows of market de- mand. US. employers historically have treated immigrant labor as a convenient faucet, easily turned on and off. In the depression of the I930S, Mexican workers were rounded up and deponed by the thou- sands when the unemployment rate went up. When World War II started, the US. government negotiated their return as braceros. Growers needed workers, but didn't want to raise wages to draw them from dties.

Today the global production system has grown ever- more flexible in accommodating economic booms and busts. Its employment sys- tem is based on the use of contractors, which is replacing the system in which workers were directly employed by the businesses using their labor. Today's pine tree planters don't work directly for Kimberly-Clark

Or the paper companies, for instance, but for labor recruiters. They ap~ pear when trees need to be planted, thinned, or harvested. When the

75

76 illegal People

work is over, they arl sent away. The papet corporations control labor costs indirecdy, throJgh the price they pay for harvested trees or wood pulp, and through tHe contracts signed with labor contractors.

Displaced migrJt workers are the backbone of this system. Its I

guiding principle is that immigtation policy and enforcement should direct immigtants tolindUStries when their labor is needed and remove them when it's not. ~ President George W Bush put it, the govern- ment should "conn~ct willing employers with willing employees."

I

Contract labor o~ers irnponant advantages to employers. The busi- nesses that use it determine how much it's paid through arrangements with contractors, arid have less and less responsibility for the actual conditions of emploiment or for what happens to workers when work ends. When demana is high, contractOrs rectUit people and they're

I

put to work. When demand falls, those people have to find other jobs. In the case of migrJts on temporary-employment visas, if they don't find new jobs, they Have to leave the country. Workers injured at work can't stay in the conhnunity around the plant where they were hurt, making demands fot treatment. They have to go back to hometowns where there is often no medical care at all. Employers don't usually have to provide compensation for those forced out of the country.

As global production lines are tuned more and more closely to changes in the marUet, employers use the flexibility of the contract- labor system to adjJt quickly. Capital has to be flexible, able to move where it can earn rae greatest return, and permanent employment only gets in the way.1 When a garment goes out of fashion, or a piece of medical or elec10niC equipment becomes obsolete, the workers who produce it bec9me expendable. Production of new product lines requires new workers, often in completely different locations.

This flexibility e.xbs a downward pressure on workers' living stan- dards. Garment mahufacrurers, for instance, travel the world com-

I

paring wage rates. Their contractors are forced to undercut each other

from country to coJntry, competing for orders by cutting labor costs. What garment prodhction remains in the United States is done almost entirely by contractors employing migrant workers. The factories owned direcdy by c6mpanies like Levi Strauss were closed years ago.

Displacement and Migration 77

This has been the employment model in the agriculrural, garment, and janitorial industries for decades, and it is 'completely dependent on migrant labor. This system is expanding to other industries. In the 1970S, production workers in Silicon Valley electronic plants worked di- reedy for big manufacturers. Today, women .~orking on the line as- sembling printers for Hewlett-Packard mosdy come from the Philippines, South and Southeast Asia, Mexico, and Latin America. But now they work for Manpower, a temporary-employment agency with an office in the plant. Sometimes they do the same job they did when they worked for HP direcdy, but now without healthcare or other benefits. They're paid a lower wage, and they can be terminated at any time.

The Profitability of Undocumented Labor

In May 1994, five months aftet NAFTA went into effect, the Urban In- stitute estimated, in its report Immigration and Immigrants: Setting the Record Straight, that the Immigration Reform and C9ntrol Act had al- ready failed to reduce the undocumented population of the United States, one of the law's stated goals. Just before the act passed in 1986, it noted, the number of undocumented people living in the United States was between 3 million and 5 million. After IRCXs amnesty pro- gram, which allowed many individuals without papers to normalize their inImigration status, the undocumented population fell to r.8 mil- lion to 3 million. Since only those people who had been living in the country since 1982 could qualify; a considerable numbet of people re- mained undocumented. By 1992, that population had rebounded to 2·7 to 3·7 million, roughly the same level it had been ~elve years ear- lier-2.5 to 3.5 million people.

IRCXs amnesty recognized the basic reality that millions of people without status were living in the United States. It took a humane ap-

proach by giving them a permanent-residence status that corre- sponded with that realiry. People were working and productive, had become part of the communities around them, and had put down roots. Giving them permanent-residence visas reCOgnized this. The

78 illegal People

effect of the amnesJ on those who qualified was profound. People gained confidence in bercising their labor rights at work, and millions began the long proc~ss of becoming US. citizens in order to gain po- litical rights as well. I

IRCXs other major provision. however-employer sanctions-had a very different effect! They were touted as a means to force those who didn't qualliY for a.rmiesry to go home. and to discourage others from migrating across th~ border without documents. Sanctions did not produce the predictea results. and the number of undocumented im- mediately began to ole. Those economic forces uprooting people. par- ticularly in Mexico. Jere just as strong after IRCA was passed as they

I

had been before. IRC!:A:s Commission for the Srudy of International Migration and Coop~rative Economic Development recogrnzed that reality. But its recorrlmendation-the negotiation of NAFTA-pro- voked a huge increa~e in undocumented migration. not a decrease. By 2007. thirteen yeJs later. there were as many as 12 million undoc- umented people liv;rlg in the United States-more than ever.

Producing undocJmented migration is not a politically acceptable goal in the United StJtes or in any of the other industrial countries to which that migrationlflows. The US. immigration debate. and the leg- islation it has produced in Congress. places great emphasis on the dis- tinction between '1eg6r and "illegal" immigration. While members of Congress disagree aBout the socially beneficial effects of legal immi- gration. they almOSt In claim that the entry of undocumented people intO the country has la negative effect. Claiming that undocumented immigration is out of control. they argue over tactics for suppressing it (except. of course. teducing displacement. which is ruled out of the

I

debate from the start~: is it better. for instance. to halt undocumented migration by denying medical care and education to children. or by prohibiting undo~ented immigrants from working. or by milita- rizing the border. or iY increasing the number of immigration raids and deportations?

The terrain of deli>ate between most Democrats and Republicans is over these measur~s for increasing enforcement. Republicans argue for the most extrem~ proposals. In California in 1994 they supported

Displacement and Migration 79

Proposition 187. which would have denied medical care and education

to people without papers. Similarly, the Sensenbrenner proposal. HR 4437. would have made being in the United St~,tes without a visa. currently a civil violation rather than a criminal one. a federal felony. Mainstream Democrats have countered with proposals to increase en- forcement on the border. and to beef up employer sanctions.

In fact. however. undocumented immigration has become eco- nOmically embedded in US. SOciety, and it produces impOrtant bene- fits. especially for industries that have come to rely on it. In 1994. the year NAFTA went intO effect. the National Immigration Forum's Guide to Immigration Facts and Issues estimated that undocumented

immigrants paid about $7 billion annually in taxes. Those payments included $2·7 billion to Social Security, and $168 million to state unemployment-benefit funds. In California. which accounted at that time for 43 percent of the nation's undocumented population. undoc- umented immigrants paid an additional $732 million in state and local taxes. according to Michael Fix and Jeffrey Passel in a srudy for the Urban Instirute. The state. in rum. spent $I.3 billion on education for undocumented children. and $166 million for emergency-room care for their families (the only kind of state-provided medical care for which they qualified.)

Undocumented children are as much a resource of US. SOciety as any of its other children. They are part of its future workforce. and will take their place in all aspects of social. cultural. and political life. inas- much as SOciety has an interest in investing in the future of any of its children (and there are certainly those who question ~). it has an interest in all of its children. It has a similar public health interest in providing emergency medical care. preventing the spread of medical problems from immigrants to the rest of the population and vice versa.

But leaving this argument aside. expendirures on the education of undocumented children. or on emergency medical care for their fam- ilies. is not a net economic drain. Undocumented immigrants pay in- come and sales taxes into the government's general funds. They pay property taxes either directly or through rent paid to landlords. They

80 illegal People

make payments fori Social Security and similar state-mandated pro- grams. Yet for the most part, they cannot by law receive the services and benefits this m06eypays for. The Social Security fund is, in effect, subsidized by paym~nts made by people who will never collect retire- ment or disability Benefits. Undocumented people paying taxes for services they can't ilise subsidize tax cuts promised by politicians to middle- and upper-ilicome voters. Federal and state enforcement pro- posals that bar und~cumented immigrants from even more services

I

and benefits will shift the burden further. A study by the N6rth American Integration and Development Cen-

ter at the Universitylof California, Los Angeles, Tracking the Economic Impacts of North A'ferican Integration: Trade, Capital, and Migration

Flows, estimated that undocumented workers annually contributed approximately 7 perdent of the $900 billion gross economic product of the state of CaliforJa, or $63 billion in the mid-I990S. That contribu- tion undoubtedly ~creased gready in the following years, as the un-. documented population grew rapidly.

In 1994 the Urban Institute estimated that about 1.4 million undoc- umented people liJd in California, 43 percent of the nation's total. The gross economid contribution by each undocumented immigrant to the state econom~ was therefore about $45,000, including children, the unemployed, and those too old or ill to work. Their precarious sta- tuS kept their wageJ near the legal minimum, $4.25 per hour at that time, which produc~d an annual income of $8,840.

I

The labor of undocumented workers pumped tens of billions of dollars into the statJ,s economy-$45,oOO per person-but the work- ers themselves wer9 paid only a small percentage of it-$8,840 each. They received a mum smaller percentage of the value they produced than that received b~ workers who were either citizens or legal resi- dents. This clifferen'ce is a source of extra profit for industries em- ploying a largely ufdocumented workforce-agriculture and food processing, land de1elopment (including the residential construction and building services industries), tourism (including the hotel and restaurant industrieh garment production and light manufacturing, transportation, retal trade, healthcare, and domestic services.

Displacement and Migration 8r

Undocumented workers, considering whet'f.r to organize a union to win better wages, have to take into account the possibility of being fired. Other workers also risk being fired, an important obstacle to all union efforts. But undocumented workers must weigh employer sanctions in the balance, which make finding another job harder and riskier. Any period of unemployment is likely to last longer. Because sanctions also disqualifY the undocumented from unemployment benefits, food stamps, or other public services, fired workers are under pressure to take any job available, at whatever wage. And under fed-

eral court rulings, an employer who shows that workers fired for union activity are undocumented is not obligated to rehire them or pay back wages. Undocumented workers who complain about unpaid wages and overtime, wages below the minimum, sexual harassment, or vio- lations of health and safety laws run the same risk.

These draconian exclusions are intended to make life unpleasant for undocumented immigrants, who presumably are encouraged to leave the country. But by making them more vulnerable and socially isolated, the exclusions make their labor cheaper. Mexican academic Jorge Bustamante argues that U.S. immigration law has histOrically been used to drive down the price of Mexican labor in the United States. IRCA:s employer sanctions, along with measures like Proposi- tion 187 and HR 4437, ensured that undocumented workers, with fewer rights and less access to benefits, remained cheaper for employers, and more profitable. \

Businesses often complain about the burden of complying with sanctions' paperwork requirements. But Jose Semperio, an organizer for San Francisco's Comite de Trabajadores Generales, a cOmmittee of day laborers, accused them of benefiting from the vulnerability of im- migrant workers. ''"When we have aCcidents, the contractor JUSt drops us off at the emergency room parking lot," he said bitterly as he cam- paigned against PropOSition 187. "Now they even want to make it ille- gal for us to get medical care at all. San Francisco, Los Angeles, San Diego, and Orange County all eat because we ,work, but we have al- most no chance to get out of the shadows."