Question
In the 20-plus years since its enactment, critics of NAFTA argue that is has not lived up to expectations. One prime example is the United
In the 20-plus years since its enactment, critics of NAFTA argue that is has not lived up to expectations. One prime example is the United States' trade deficit with Mexico. Although it was projected that NAFTA would result in lucrative trade surpluses with Mexico, the exact opposite has occurred. In addition, a 2013 study by Mexico's tax administration found that, rather than increasing, Mexican worker wages actually were falling far below the pre-NAFTA levels.
In the United States, the trade deficit has caused an enormous displacement of workers and is a major contributor to the economic downturn in the manufacturing industry. As U.S. companies have moved factories across the border, communities have experienced economic instability because of the loss of their tax bases. Displaced workers find it very hard to maintain or recover their standard of living. In 2012, the U.S. Bureau of Labor Statistics determined that, on average, two out of three displaced workers who found other work could do so only at much lower pay. Needless to say, NAFTA is not exactly popular with the U.S. manufacturing industry. As domestic goods lose market share to cheap imports, manufacturing plants will continue to close. Sadly, the remaining plants are often unable to retool to offer new, better job opportunities for displaced workers.
In terms of job loss, North Carolina is one of the states most adversely affected by the North American Free Trade Agreement (NAFTA). Assume hypothetically that North Carolina is considering a 25% tariff (tax) on all foreign-manufactured textiles and furniture items imported into the state. The tariff's purpose will be predominantly protective, designed to protect and advance textile and furniture manufacturers in North Carolina and to create jobs.
Give a advise to the lawmakers in North Carolina of the constitutionality of such a tariff.
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