THE HISPANIC EXPERIENCE
  Perspective on the Frontier

Houston Institute for Culture 
SPECIAL FEATURE
Stolen Birthright: The U.S. Conquest and Exploitation of the Mexican People [6 of 6]
By Richard D. Vogel

Hecho en México:
Maquiladoras


Capitalism relentlessly seeks the cheapest labor it can find in order to maximize its profits, and U.S. capitalism is no exception to the rule. American industry began a runaway shop movement in the late 1950s that relocated much manufacturing from the heavily unionized Northeast and Midwest to the American South in order to exploit cheaper, non-union, white, African American, Mexican American, and Mexican labor. In the mid-1960s, U.S. employers crossed the border into Mexico to take advantage of the large pool of unemployed Mexican workers created by the termination of the bracero program. The Mexican government, under the pressure of mass unemployment and unwilling to reform Mexico's economy, accommodated the U.S. by adopting the Border Industrialization Program (BIP) in 1965, which permitted the establishment of maquiladoras on the Mexican side of the international border. These businesses were allowed to import components tariff-free for assembly in Mexico and then re-export the finished products, with a nominal tariff, back to the United States. Maquiladoras were granted further tax advantages. Foreign-owned companies that located in Mexico and employed Mexican workers were required to pay only a 5 percent housing tax on wages and a few token fees to the Mexican government.

The exploitation of Mexican workers through the maquiladora system, now almost 40 years old, continues to be a source of massive superprofits. Capitalists, always focused on the bottom line, save up to 75 percent on labor costs as compared to American workers and avoid all of the social costs of industrialization that they would have to pay north of the border. American firms have responded to the lure of cheap labor and tax advantages enthusiastically -- by 1990 there were more than 1,500 maquiladoras exploiting more than 400,000 workers operating in Mexican cities along the border. By 1995, these numbers more than doubled and the plants had begun spreading into the interior of the country. In June of 2001 the number of maquiladoras peaked at 3,763. At that time, 1,347,803 Mexican citizens were working in foreign-owned plants inside of Mexico.

Overall, the exporting of industrial jobs to Mexico has been a boon to American capitalism, pushing corporate profits to all-time highs. In addition to cheap labor and low taxes, the Mexican maquiladora industry offers foreign employers additional advantages including subsidized rates for electricity and water, state financed industrial parks, and lax enforcement of environmental and labor laws. And key to the continuing exploitation of Mexican workers, the government of Mexico guarantees "a climate of labor peace" by controlling unions and preventing strikes or slowdowns by maquiladora workers.

Though American business has reaped huge profits from the maquiladora system, the effects on Mexican workers have been mixed. While many jobs have been created, current wages and working conditions in the maquiladoras resemble those in the U.S. a hundred years ago. The typical maquiladora workday consists of 9 to 9 1/2 hours of tedious assembly work at monotonous, repetitive operations conducted at accelerated rates under inadequate working conditions. The majority of workers are women in their teens and early twenties because they are easier to intimidate and work for less than men. Sexual harassment on the job is common and abuses are seldom punished. Employers give women pre-employment and periodic on-the-job pregnancy tests and fire pregnant women in order to avoid paying maternity benefits. Workplace health hazards are rampant, but workers, fearing for their jobs, seldom complain. To make matters worse, Mexican social security law, in practice, does not recognize occupational illnesses so workers receive no compensation if their health is ruined on the job. It is not surprising that the maquiladora employee turnover rate is estimated to be 20 percent per month.

To make matters worse, wages have been steadily declining in the maquiladora industries from $1.38 per hour in 1982 to less than $.50 an hour in 2001. The current maquiladora minimum wage of $3.50 per day is below subsistence level income even in Mexico. With the prevailing high prices of goods and services along the border, it takes four to five times the current minimum wage to pay for an average family's basic needs.

The issue of the environmental pollution created by the maquiladoras is an international scandal. Many toxic materials prohibited in the U.S. are widely used in Mexico because there is no legislation to control them. In fact, many U.S. industries relocate to Mexico primarily to be able to use these materials with impunity. This problem is not restricted to the workplace. Inadequate toxic waste disposal in Mexico has led to the contamination of the air, land, and both surface and ground water. The Rio Grande, which receives much of the contaminated run-off from maquiladoras, is used to irrigate crops on both side of the border. The resulting environmental pollution is producing widespread health problems in the lower Rio Grande valley and a dead zone in the Gulf of Mexico that rivals the one at the mouth of the Mississippi River.

Ciudad Juárez

Ciudad Juárez offers a stark picture of the political, social, and environmental impact of the maquiladora system in Mexico. This city of 1.3 million citizens has about 340 maquiladoras that employ more than 150,000 workers. But the influence of the maquiladoras extends beyond their immediate employees. Many other jobs in the city are in businesses and public agencies that service the maquiladoras such as housing, food services, police and fire protection, public works, and public schools that teach the children of maquiladora employees.

In Ciudad Juárez, as everywhere, economic power translates into political power. In this city where half the population lives in homes without sewer service, municipal administrators have made accommodating foreign-owned factories their top priority. The official 2010 development plan for the city focuses on paving projects and the development of roads between the maquiladoras and the border crossings, while ignoring the social services that impact the quality of everyday life for Mexican citizens.

Family life, the foundation of every community, has deteriorated under the influence of the maquiladoras. About half of the families that reside in the two and three room adobe houses in the working-class neighborhoods of Juárez are headed by single mothers, many of whom toil long hours in the maquiladoras for subsistence wages. The resulting stress on families has lead to chronic problems of poor health, family violence, and child labor exploitation. Children suffer the most. Because of the lack of child-care programs, kids are often left home alone all day and fall prey to the worst aspects of street culture, such as substance abuse and gang violence. Ciudad Juárez, by any measure of social progress, is moving backward rather than forward under the influence of the maquiladora industry.

Environmentally, the city is a catastrophe. Ciudad Juárez, with its persistent smog, vast solid waste dumps, and contaminated surface water (all exacerbated by the maquiladoras) is the worst pollution point along the entire 3,033-kilometer (1,885 mile) length of the Rio Grande.

La Frontera:
Boomtowns and Busted Workers


The situation in Ciudad Juárez is not exceptional. The millions of jobs that have been created along the border since 1965 have sparked a mass migration to the North, but the lives of Mexican workers have not improved under the reign of the maquiladoras. Since the 1982 economic crisis in Mexico, wages have declined and working conditions have deteriorated in the maquiladora sector, mirroring the stagnation of the economy at large. The U. S. was quick to exploit the crisis. During the oil boom of the 1970s, finance capitalists from the North had extended easy credit to the Mexican bourgeoisie who went on an unbridled spending spree that mortgaged the future of the country. The economic bust in the early 1980s offered U.S. and other creditors a golden opportunity. Through the World Bank and World Trade Organization (WTO), they insisted on the devaluation of the peso and the imposition of financial austerity programs on the country in order to repay the outstanding loans and, at the same time, tighten their control over the Mexican economy.

The domestic austerity programs imposed on Mexico were promoted under the slogan "short-term pain for long-term gain". The Mexican government, afraid of losing credit from the North and unwilling to reform the economy to benefit working class Mexicans, agreed to the following austerity programs that freed up money for debt repayment and opened Mexico to further U.S. penetration and exploitation:
- To cut social spending. The Mexican government increased fees for medical services, resulting in less treatment, widespread suffering, and needless deaths among the poorer segments of the Mexican population. The government also increased public school fees, a move that forced many poor parents to pull their children, especially girls, out of school. This austerity program also required a reduction of pension payments, shifting the burden of debt to the disabled and elderly.

- To shrink government. Because the government was the largest employer in Mexico in the early 1980s, this change resulted in massive lay-offs and increased nationwide unemployment. The poor, hit hardest by this program, became desperate to work at any wage.

- To increase interest rates. This economic policy cut off loans to small farmers and businessmen, crippling the domestic economy and increasing unemployment across the country. This policy shift dramatically expanded the ranks of the poor.

- To eliminate regulations on the foreign ownership of resources and businesses. This change allowed U.S. capitalists to gain control of key industries such as mining and allowed them to penetrate deeper into the heart of Mexico. To attract more investment from the U.S. and other rich nations, the Mexican government secretly pledged not to enforce labor and environmental laws against foreign businesses.

- To eliminate tariffs. This reform undermined Mexican-owned industries and opened the markets of Mexico to U.S. and Canada. Unable to compete against advanced and, in many cases, government subsidized North American producers, many domestic industries had to shut down and lay off their workforce. This policy hit Mexican agriculture especially hard -- well over a million small farmers were wiped out.

- To privatize government-owned enterprises. This economic policy transferred many assets owned by the Mexican people to private, often U.S., ownership. The transportation, communication, and mining industries were hit the hardest. State enterprises were sold at a fraction of their actual worth, and their transfer to private ownership resulted in higher prices and reduced services across the nation.

- To reduce government subsidies for bread, petroleum, fertilizer, etc. This change increased the cost of living in Mexico beyond the resources of average citizens and exacerbated the distress of the poor.

- To reorient the Mexican economy away from domestic production and toward export production through tax incentives. This move threatened food security, increased the exploitation of natural resources by foreign interests, and increased Mexican dependence on expensive imported food and manufactured goods.
The "short-term pain for long-term gain" slogan used to justify the U.S.-imposed austerity programs has proven in practice to be long-term pain for Mexican workers and long-term gain for U.S. capitalism. One major result of the programs has been a mass migration of desperate Mexican workers to the maquiladora cities on the U.S.-Mexico border. Between 1980 and 2000, the populations of Tijuana, Ciudad Juárez, Ciudad Acuña, Reynosa, and Matamoros more than doubled. The population booms at Mexicali, Nogales, Piedras Negras, and Nuevo Laredo were not far behind. The advantage to U.S. capitalism was swift and substantial -- by 1983 two thirds of the foreign investment in Mexico was concentrated in the maquiladoras and, in one year (between 1982 and 1983), wages were cut in half (from $1.38 to $.67 per hour). The superprofits realized by America firms helped pull the U.S. out of its own economic crisis and attracted even more American capital to Mexico. Between 1982 and 1987, the number of maquiladoras and the maquiladora workforce nearly doubled. During the same period, because of the skyrocketing populations, and because the maquiladoras paid such low wages and so few taxes, social conditions continued to deteriorated in the boomtowns along the border.

The maquiladora system has proven so advantageous to U.S. capitalism that every American president of the last four decades has actively sought to expand the program and push it ever deeper into Mexico. A major milestone in the U.S. quest to further exploit Mexico and her people was the North America Free Trade Agreement (NAFTA) of 1994.

Mas Pobreza:
The Impact of NAFTA on Mexico


The indigenous people of Chiapas knew what the NAFTA treaty would do to the resources and working people of Mexico and greeted it with an armed uprising against the government that had collaborated with the U.S. by ratifying it. The Declaration of War issued by the Zapatista National Liberation Army shows that the peasants understood the long history of exploitation and betrayal in Mexico:
We are the product of 500 years of struggle: first against slavery, then during the War of Independence against Spain, then to avoid being absorbed by North American Imperialism, then to promulgate our constitution and expel the French Empire from our soil, and later the dictatorship of Porfirio Díaz denied us the just application of the Reform Laws, and the people rebelled and the leaders like Villa and Zapata emerged, poor people just like us. We have been denied the most elemental preparation so that they can use us as cannon fodder and pillage the wealth of our country. They don't care that we have nothing, absolutely nothing, not even a roof over our heads: no land, no work, no health care, no food, no education. Nor are we able to freely and democratically elect our political representatives, nor is there independence from foreigners, nor is there peace nor justice for ourselves and our children....
The Zapatista rebels knew that "free trade" is not free. "Free trade" is the trade policy that always favors the strong over the weak, and through NAFTA the U.S. has furthered pillaged the wealth of Mexico and expanded its exploitation of the Mexican people. To gain support for the treaty, bourgeois politicians of the U.S., Mexico, and Canada promised their citizens economic growth that would fuel business and job opportunities, increase trade, extend environmental protection, end illegal immigration, and strengthen democracy in North America. Contrary to the political rhetoric, the impact of NAFTA especially on Mexico, the weakest of the three nations, has been disastrous:
- Although the unprecedented surge in trade and foreign investment in Mexico (mostly U.S.) produced 500,000 jobs in manufacturing between 1994 and 2002, the agricultural sector, where a fifth of all Mexicans still worked at the implementation of the treaty, lost 1.3 million jobs in the same period. The net effect has been increased unemployment and dislocation of workers in Mexico.

- Though labor productivity and profits have increased dramatically throughout this same period, real wages for most Mexicans are lower today than they were when NAFTA took effect, continuing the trend that started with the U.S. imposed austerity programs of the 1980s. Current estimates indicate that since the passage of NAFTA wages have decreased by 30 percent while the cost of living in Mexico has increased by 250 percent. Rather than improving the lives of Mexican workers, most of the new wealth created by NAFTA has flowed to the North as superprofits for American capitalism.

- The environment of Mexico that suffered extensive damage from the maquiladoras has deteriorated further under NAFTA. The Mexican government estimates that annual pollution damages over the past decade exceeded $36 billion per year. This damage to the environment is greater than the economic gains from the growth of trade and the growth of the domestic economy combined.

- NAFTA has not stemmed the flow of poor Mexicans into the U.S. in search of jobs. In fact, there has been a dramatic rise in illegal migration to the North despite the U.S. militarization of the international border.
While American capitalism has profited handsomely from NAFTA, the lessons of the devastating impact of the treaty on the people of Mexico have not been lost on other nations of the South. The ongoing U.S. attempt to spread its tentacles of exploitation throughout the hemisphere through CAFTA (The Central American Free Trade Agreement) and FTAA (The Free Trade Areas of the Americas) is meeting with spirited resistance.

The current and chronic economic crisis of Mexico, the latest result of the historical U.S. exploitation of the Mexican people that dates back to the conquest, has produced a critical situation that the U.S. ruling class and their Mexican collaborators never anticipated and are unable to deal with -- despite the unrelenting exploitation that poor Mexicans have been subjected to on both sides of the border, they are gradually but inexorably reclaiming their birthright in North America.

Part III: Exodo:
Reclaiming the Mexican Birthright


One would expect a saga of ruthless conquest followed by six generations of relentless exploitation to have a bitter ending -- but not so in the case of the Mexican people. America's continuing exploitation of Mexico, especially during the last twenty years, has created a challenge to the basic structure of U.S. capitalism that will have to be dealt with sooner or later. The undermining of the Mexican economy through the rise of the maquiladoras, the imposition of austerity programs, and NAFTA have sparked one of the greatest mass migrations of workers and their families in history. The central feature of this migration is that it has developed an inexorable momentum of its own -- it simply cannot be stopped.

The ruling classes on both sides of the border, preoccupied with their own economic interests, do not understand the consequences of this central fact. Border observers have documented that the maquiladora system has not proven to be an effective deterrent to unauthorized migration, but has, on the contrary, accelerated the migration of Mexican workers to the U.S. Even defenders of NAFTA know that the treaty has caused massive economic dislocations in Mexico and fueled further unauthorized immigration to the U.S., but choose not to address the issue. After all, the Mexican ruling class is as grateful to be free of their unemployed workers as the U.S. is to exploit them.

In sum, the shortsighted policies of the ruling classes on both sides of the border have created the situation that exists today. All of the official bi-lateral border commissions and so called "think tanks" that seek to influence public policy come up with the same conclusion -- since the mass migration to the North can not be halted, it needs to be managed -- managed of course, to the advantage of the bourgeoisie on both sides of the border.

But there is no indication that the exodus of Mexican workers to the U.S. is manageable. The internal migration in Mexico has amassed a population of 4 to 5 million poor people in the maquiladora cities along U.S.-Mexican border at a time when U.S. capitalism is relocating many of their Mexican plants to Asia in pursuit of even lower wages. Unemployment is rising and wages are falling along the border while the poor from the countryside continue to arrive daily. These destitute people massed on the border cannot stay were they are -- they are being pushed North by the poverty in their hometowns and villages and being pulled across the border by the prospect of a better life in the U.S. In 2003, the average annual salary of a maquiladora worker was just over $2,500 compared to almost $20,000 for Mexican immigrants working in the U.S. Authorized or not, the mass migration will not be stopped.

Despite all of the obstacles facing the migrants, the prospects of making a successful journey to the North are excellent -- according to the current estimates of both the Mexican and U.S. governments, 22 to 23 million persons of Mexican origin (including about 8.8 million Mexican-born) presently live in the United States, and 54 percent of the Mexican-born have arrived there since 1990. Modern U.S. immigration law intended to impede Mexican immigration has actually promoted it. Both the 1965 Immigration Act, which ended racial discrimination and stressed family-reunification, and the 1986 Immigration Reform and Control Act, which offered amnesty to established illegal immigrants, made it easier for Mexicans to become U.S. citizens. And today, as in the past, unauthorized immigration greatly surpasses legal immigration and continues almost unchecked.

Truly, a critical period in the history of both nations is at hand.

Trabajadores hoy:
Essential Workers for U.S. Capitalism


Although Mexican workers, both legal and illegal, have had to take the most undesirable and lowest paid jobs that American capitalism has to offer, they have become essential workers in the U.S. economy. In the 1990s alone, the number of Mexican immigrant workers in the U.S. grew by 2.9 million, a 123 percent increase in this segment of the labor force. Employment of Mexicans continued to climb in the traditional areas of the Southwest, but the growth rate was greatest in the East South Central states. Nationwide, 19 percent, or one of every 5 workers, joining the U.S. labor force during the decade was from Mexico.

The above estimates do not include the large number of Mexican immigrant workers who are employed in the informal, or underground, economy in the U.S. These unreported jobs are concentrated in manufacturing, construction, restaurant, and retail services. Other areas of underground employment include auto cleaning, landscape maintenance, hotels, janitorial, and domestic services. Underground employment is widespread, especially in the Southwest, but difficult to estimate. The Economic Roundtable of Los Angeles estimated that between 9 and 29 percent of the L.A. County labor force was unreported in 2002. That percentage translated to between 400,000 and 1.5 million workers out of the total work force of 4.1 million in the county who were paid off the books. The underground economy is just as significant in San Diego, Las Vegas, Phoenix, Tucson, Denver, Colorado Springs, Albuquerque, Oklahoma City, El Paso, San Antonio, Ft. Worth, Dallas, Houston, and Corpus Christi. The overwhelming majority of these workers is from Mexico.

Despite systematic exploitation in the U.S., Mexican workers have been remarkably successful, moving up in the ranks of the working class and establishing viable communities throughout the American Southwest and across the nation at large. These growing communities have become so successful and vital that, beyond being self-supporting, they are sending significant amounts of money back to their families in Mexico. The trend of these remittances has skyrocketed in the last twenty years, reaching a record total of $13.3 billion in 2003, the third largest source of foreign revenue in Mexico.

At the present time, the Mexican immigration debate is relatively muted. U.S. capitalism has access to the low-cost Mexican reserve army of labor on both sides of the border, while Mexican workers have prospects for jobs and hope for the future. Immigrant communities in the U.S. are viable and prospering. The Mexican elite, hoping to export all of their domestic troubles, is presently advocating an open border policy. While not advocating an open border, U.S. capitalism has left the door ajar.

But under capitalism, crisis is always right around the corner. The big question about the future of Mexicans in the U.S. remains unanswered -- What will happen to the Mexican community on both sides of the border when the U.S. economy slows down? Wages will fall and unemployment will rise. The quality of life for all workers in the U.S., deteriorating at the present time, will fall to even lower levels. U.S. capitalists may be able ignore the consequences of widespread economic and social dislocation south of the border, but not inside the U.S. With family savings at all time lows and current public welfare programs cut back to almost nothing, crime and social conflicts will increase. The history of the U.S. suggests that when the demand for cheap Mexican labor drops the pressure to repatriate Mexican workers and their families will increase. Mass deportation was the response during the Great Depression and the post-Korean War recession, but the chances of such a reactionary policy working now are slim.

The Mexican community in modern America is unlike that of the past. In the decades of the 1930s and 1950s, most Mexican immigrant workers and their families in the U.S. lived in rural areas and worked seasonal agricultural jobs. They were easy to identify, roundup, and deport. Because they were so vulnerable, there was little resistance to the assault. Indeed, the immigrants themselves knew that their stay in the United States was temporary and many left the country voluntarily as soon as anti-immigrant campaigns were mounted.

The Mexican community in the U.S. today, by way of contrast, is settled on a permanent basis. Though many Mexican workers continue to toil in the fields of the Southwest, the modern Mexican community is much more diverse and more deeply rooted than in the past. The Mexican community in America is now 95 percent urban and living in established families of several generations. Because being born in America grants citizenship, most children in the Mexican community, even those with illegal parents, are U.S. citizens. Current estimates place the number of U.S. born children to Mexican parents at about 8.2 million. In addition, members of the immigrant Mexican community, both authorized and unauthorized, have taken advantage of both economic and educational opportunities to establish themselves firmly in U.S. society. It is unrealistic to expect the current Mexican population in the U.S. to submit to summary deportations like their earlier compatriots were compelled to do. As an established community, they have both motive and means to resist dispossession.

El Futuro:
Another 50 Years of Mass Migration


The impending political crisis surrounding Mexican workers and their families in the United States will not be a repeat of the past. Regardless of the level of demand for Mexican labor in the U.S., both Mexico's National Population Council and the U.S. Census Bureau predict another 50 years of mass migration. Both government agencies currently estimate a doubling of the Mexican-born population in the U.S. by 2030 and a slightly lower, though substantial growth rate through 2050. By mid-century, Mexicans will be the largest minority group in America and an absolute majority in several major cities of the Southwest. With these numbers, the Mexican community in the U.S. will shake American society and U.S. capitalism to their roots -- Mexican workers are no longer a reserve army of cheap labor that can be summarily discharged from duty and deported as it has been in the past.

History is on the march. The ongoing Mexican exodus to the U.S. is erasing the arbitrary line that has divided the American Southwest since the Treaty of Guadalupe Hidalgo and the Gadsden scam. Every Mexican immigrant in the United States today, legal or illegal, and every Mexican man, woman, or child who crosses the border, legally or illegally, into the U.S. to work and build a better life is reclaiming a share of the Mexican birthright in North America denied to his/her people for over a century and a half.

¡Viva México!

RETURN TO INTRODUCTION


Copyright 2004 by Richard D. Vogel.


Richard D. Vogel is a retired teacher who writes about current social and political issues. Other articles by the author are available at monthlyreview.org.

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