NAFTA

In just ten years, NAFTA has created the world's most formidable free trade area. But in the absence of true partnerships and multilateral institutions, movement toward further regional integration has slowed. The United States, Mexico, and Canada have many common interests; they need to pursue them in common ways.

Americans like to take the stability of their southern NAFTA partner for granted. But while things are going well in Mexico, a backlash is brewing. The end of one-party rule has brought chaos to Mexico as three political parties jockey for power in an atmosphere rife with recriminations and dirty tricks. If a minority government emerges from the 2000 elections, it could lose control of the country. Political violence remains a threat, and drug lords and rebel groups undermine the government. It all makes authoritarian solutions ever more attractive. Mexico must wake up before its many nightmares become reality.

To the United States, the labor and environmental costs of NAFTA would be minimal and the economic benefits real, but small. The trade agreement is really about helping a friendly and important neighbor in its yet uncompleted economic and political reform.

California is the most populous state in the United States. Its gross economic product is seventh in the world, well ahead of China or Canada. Given its massive size and the fact that the export-driven sector is the only part of its economy that shows any potential for long-term growth, California is increasingly adopting its own foreign policy. In turn international economic trends are having strong regional effects from San Diego to San Francisco. At the center of this new interdependence lies the North American Free Trade Agreement and the pivotal bilateral tie between Mexico and California.