Maquiladora

How Does “Free Trade” work?

The creation of the “free trade zone” is taken advantage of by multinational corporations that use NAFTA and CAFTA not to facilitate trade with Mexico and Central America, but to minimize production costs and maximize profits. Factories are built within the free trade zones at minimal costs; no federal or state taxes need to be paid, as would be mandatory if the factory were located in the United States. Machinery and raw materials can be shipped across the border to the free trade zone factories duty-free and completed products shipped around the world at reduced tariffs. The arrangement benefits U.S. multinational corporations in their ability to relocate production for tremendous savings.

Wage Slavery

In addition to the tax and tariff benefits, the most significant and profound savings is reduced labor costs. The multinational corporation, to maximize profit, has the goal of searching for and/or demanding the lowest wages. The average compensation for an entire day of work for a maquiladora worker is less than the hourly wage for comparable work in the United States. A maquiladora worker can expect to make $3 to $4 a day. Also, the companies do not have to pay any benefits; for example, social security, retirement, health insurance, or unemployment insurance. U.S. multinational corporations have a vested interest in producing goods using this model. NAFTA and CAFTA may have advancing trade as their goals, but the maquiladora workers do not make enough money to buy any of the products they produce.

Worker and Environmental Protection

U.S. companies utilizing the maquiladora are not governed by the guidelines set by the Occupational Safety and Health Administration. The factories are not held to the same (or any) standards for worker safety and rights, as Mexico and other nations lack an adequate staff and funding to complete the task of regulating safety and waste. Workers are exposed to unsafe conditions, with the potential of immediate and long-term effects. The labor is fast paced, and machinery does not have safety features, which increases risk of immediate physical injury (e.g., cuts and amputation). Long-term injuries from rapid repeated motion without adequate rest or ergonomie accommodations are common (e.g., stress injury, carpal tunnel syndrome). Maquiladoras produce goods for a spectrum of industries, and workers are placed into harm's way, as they are rarely provided protective gear and there is inadequate ventilation as they work with toxic, sometimes carcinogenic, materials (e.g., plastics, resins, glue/adhesives, lacquer/paints). Many companies actively relocate to utilize materials in the maquiladoras, that have been banned for use in the United States. In addition to the potential harm to workers, many maquiladoras pollute the surrounding areas and environment by dumping their waste locally. Many members living in communities near maquiladoras sometimes become ill due to the pollution of surface/ground water, air, and land. Some factories use waste export and control companies, but repeated research has documented that these are the minority of cases.

...