PERSPECTIVES ON NAFTA : Mexico’s Turnabout Earns Our Vote : Our neighbor is destined to be a major player; the treaty will smooth our relationship at no cost to us.

Now that negotiations on side agreements to the North American Free Trade Agreement have been concluded, we all should take time out from the debate to appreciate the almost miraculous circumstances that have made NAFTA possible.

Quite simply, nothing less than a revolution in Mexico was required to bring NAFTA about. We should not forget that as recently as the early 1980s, Mexico’s economy was politically and economically crippled. Corruption was rampant and institutionalized. The cost of living had spun out of control, turning the once rock-hard peso into dust. What’s more, Mexico was burdened with an enormous foreign debt that, the government made clear, could not be paid back. With the economy at a standstill, the expanding population was left with fewer jobs, which in turn produced the highest rate of migration to the United States since the Mexican revolution.

That was then. Things have since changed.

Under the bold leadership of President Carlos Salinas de Gortari (and the foundation prepared by his predecessor, President Miguel de la Madrid) Mexico’s fiscal house has been put in order. Budget deficits have been cut and interest rates have become realistic. Tax collection has improved. A privatization campaign has merged or sold 900 state-owned companies. Farmers are able to own their own land and to sell it freely. Foreign investors are welcome. Mexican capital is being repatriated. The economy is booming. Opposition parties have more room in which to operate; two of them have already won governorships, a first in modern Mexican history.

It is in this context of positive change that we should discuss NAFTA.

The chief concerns have been that NAFTA will lure U.S. jobs to Mexico and perpetuate “lax” Mexican environmental standards. While these are serious issues and I applaud President Clinton for addressing them in the side agreements, these “threats” are nominal.

We should put to rest the claim that NAFTA will send American jobs packing to Mexico. There is nothing preventing such southward migration from occurring right now. A U.S. company wanting to move its facilities to Mexico can do so now; it does not need NAFTA.

Furthermore, the consensus among U.S. economists is that we will realize a net gain in jobs under the agreement. These experts estimate that U.S. exports to Mexico are now responsible for 700,000 U.S. jobs, a figure that will grow to 900,000 in just two years under NAFTA. Rejecting NAFTA, however, would cost 500,000 U.S. jobs.

Perhaps the best testament to such job-growth potential is the remarkable turnaround in the U.S.-Mexico balance of trade since Mexico began to lower trade barriers in 1986. In just six years, the U.S. trade balance with Mexico has improved by $10.3 billion, from a deficit of $4.9 billion in 1986 to a surplus of $5.4 billion in 1992. Far from being an affront to labor, NAFTA will lock in these gains and create jobs.

What about the environment? No one who has breathed the air of Mexico City (or of Los Angeles, for that matter) as I have for so much of my life can possibly say that environmental questions aren’t important. What critics may not realize is that Mexico has significantly bolstered its environmental standards. More than four years ago, Mexico passed comprehensive legislation protecting the environment--legislation modeled after our own. Mexico is also acquiring, with our help, the enforcement muscle to make those laws something more than merely good intentions. Furthermore, Mexican officials say that all new incoming investment will have to meet these modern standards, including the issuance of environmental impact statements. No exceptions or exemptions.

The more appropriate question, then, is whether Mexico’s environmental conditions would improve absent NAFTA? How could they? Environmental responsibility must be nurtured, and NAFTA provides the requisite stimulus. Prosperity and responsibility, after all, go hand in hand. Nations invariably begin to combat pollution when per-capita income climbs to certain levels; thus, as Mexican per-capita income rises--as it will under NAFTA--so, too, will Mexico’s ability and resolve to combat environmental abuse.

Surely, we win with NAFTA. The importance of the agreement, however, goes beyond winners and losers to a much larger issue: the unique opportunity for the United States, Mexico and Canada to continue on their historic journey.