Some U.S. businesses have opted to take advantage of the low wage rates, some¬ times lax environmental laws, and peso devaluation in Mexico by establishing ETHICS AND QUALITY maquiladoras. Maquilas have surpassed tourism and oil as the prime generator DISCUSSION of dollars in Mexico.

But there's a downside to the good news, which has come at the expense of the very people who make the factories run.

The plant workers, many ofwhom lived in deplorable conditions by U.S. standards even before the [peso] devaluation, are worse off. Their wages have increased only slightly or not at all, while the price of everything from milk to rent has risen sharply.

Tijuana's narrow, pothole riddled steets are congested', its sewer system inefficient. Conditions are especially decrepit in the shantytowns where the maquiladora workers live. Raw sewage runs down the dirt paths that lead to houses many live in, often one- or two-room shacks made of plywood or concrete block. Some lack running water or electricity.

Maquiladora managers say they're torn between employee raises and increased profits, compli¬ cated by a need to satisfy the Mexican government, which wants to keep wages down to curb inflation.

[SOURCE: Hayes Ferguson, “Tijuana Assembly Factories Booming,” (New Orleans) Times-Picayune (April 26, 1995), p. Al. © The Times-Picayune Publishing Corporation.]

a. Discuss the ethics of operating maquiladoras from the perspective of a U.S. business.

b. Discuss the ethics of operating maquiladoras from the perspective of a Mex¬ ican worker.

c. As the manager of a U.S. business, discuss some methods of enhancing the positive impacts of maquiladoras and minimizing the negative impacts. How might (has) the North American Free Trade pact affect(ed) maquiladoras?

LO2