Workers’ Wage and NAFTA

* So Michael Kinsley (Column Left, Sept. 17) thinks NAFTA is a good deal because American consumers gain by paying Mexicans $3 an hour for what they’d have to pay Americans $16 an hour. It’s futile, he says, to try to preserve the $16-an-hour jobs.

Kinsley’s argument makes perfect sense, but doesn’t go far enough. Many countries not only pay subsistence wages, but also have weak or nonexistent child labor laws. And some countries, like China, are reputed to allow slave labor. Surely we must lift all restrictions on the import of goods from these countries as well, so as not to deprive the American consumer of the benefit of these enlightened practices. In the long run, it is to be hoped, American wages and working conditions will attain the levels prevailing in these countries, so that we can regain our competitiveness on the global market.

Like many NAFTA proponents, Kinsley argues that as U.S. corporations stream into Mexico, the Mexican wage will rise to the point where the Mexicans will be able to buy more American-made goods (assuming there still are any). As a free market champion, he should know there is nothing inevitable about this. Wage levels are determined by supply and demand in the labor market. With close to 100 million people, Mexico is likely to have enough $3-an-hour workers to meet U.S. companies’ needs for many years to come. And if Mexican wages ever do rise significantly, the multinationals can always relocate to other Third World countries. The world population, after all, is almost 6 billion--enough to ensure that the worldwide “free market” wage remain stable at about subsistence levels.

JAY GOLDBERG

Los Angeles

* I have witnessed the proponents and opposition arguing over NAFTA on TV and it looks to me those favoring the passage of the treaty have good, high-paying jobs. Whether the treaty is passed or turned down by Congress, those for the treaty will still have their jobs.

HERMANN PAUL SCHLANDER

Palm Desert

* Sen. Barbara Boxer is apparently receiving bad economic advice. A major part of her recent explanation for her opposition to the North American Free Trade Agreement (Sept. 16) rested on her statement that “Economists’ predictions about the impact of NAFTA on American jobs range from short-term losses in the thousands to losses in the hundreds of thousands.”

This is a highly misleading summary of what economic research on this issue has found. It is true that some jobs would be lost as a result of NAFTA, but more jobs would be created. Virtually every study conducted by respected research economists has concluded that NAFTA would result in a net creation of jobs in the U.S. Estimates of substantial job losses reported by NAFTA opponents have been based on faulty assumptions that violate basic economicanalysis. My colleague Patricia Dillon of Scripps College recently completed a survey of estimates of the effects of NAFTA on the California economy. The net economic effects for our state are expected to be positive, just as they are for the country as a whole.

THOMAS D. WILLETT

Associate Director

The Lowe Institute of Political Economy

Claremont McKenna College

* I have just finished reading “The Myth of Free Trade” by Dr. Ravi Batra. To quote a paragraph from the cover flap, “Almost every economic problem we face--the outrageous federal deficit; rising unemployment; the shrinking middle class; the “merger mania” that slashed jobs, killed competitiveness and increased corporate debt; and environmental degradation--can be linked to the free trade policy that the United States has been following over the last 20 years.” Finally someone in this country might have some idea what is wrong with our economy.

But from our politicians and the special interests that support them, we keep hearing the same old ideas and programs that got us into this mess. When are the people in this country going to wake up?

ROBERT J. STELLABOTT

Yorba Linda