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Transnational Across the Border: Mobilizing US Support for the Mexican Maquila Industry

Published online by Cambridge University Press:  16 January 2009

Leslie Sklair
Leslie Sklair
Affiliation:
Senior Lecturer in Sociology at the London School of Economics and Plitical Science, Houghton Street, London WC2A 2AE, England.
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Extract

Despite all the talk of protectionism in both rich and poor countries there has probably never been a time when the idea of economic autarchy has been less popular than the 1980s. The so-called “New Protectionism” of the 1980s has several historically novel dimensions but far from being “New” the essential idea is the very ancient one of corporations encouraged by the governments of the countries in which they are domiciled attempting to gain competitive advantages over those from other countries by fair means and by foul. The traditional charges of low cost producers flooding markets with cheap, and sometimes dangerously inferior goods, the use by foreign governments of unfair incentives to exporters (export subsidies), and the imposition of quantitative import restrictions by importing countries, are flying around global commerce to a degree that has some very sober politicians, policy makers and economists publicly worried for the very future of the global system and, by implication, world security. To put it bluntly, the ideologues of “free trade” or “liberalization” as it is increasingly being labelled, argue that the “New Protectionism” if it is permitted to spread will inevitably lead to a “New Depression,” and this may well lead to global anarchy not only in commerce but also in the politico-military relations between nations.

Type
Research Article
Information
Journal of American Studies , Volume 24 , Issue 2 , August 1990 , pp. 167 - 185
Copyright
Copyright © Cambridge University Press 1990

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References

1 The World Bank's annual World Development Report, (New York: Oxford University Press, 1987)Google Scholar, in particular provides extensive evidence of the material basis and ideological expression of these sentiments.

2 See Scott, Bruce and Lodge, George (eds.), U.S. Competitiveness in the World Economy (Boston: Harvard Business School Press, 1984)Google Scholar on the first, and the special issue of International Organisation 42 (Winter 1988) on the second.Google Scholar

3 It is not necessary here to go into the complexities of Tariff Schedule of the United States 806/807, but it should be noted that item 807, which accounts for most maquila imports, was replaced in 1989 by the Harmonized Tariff Schedule Subheading 9802.00.80. For convenience, I shall simply refer to 806/807.

4 For a detailed account, see Sklair, Leslie, Assembling for Development: The Maquila Industry in Mexico and the U.S.A. (Boston & London: Unwin Hyman, 1989)Google Scholar, from chapter 8 of which some of the following material is taken.

5 Mendelowitz, A., “Statement on Commerce Department Conference on Mexico's Maquiladora Program,” US General Accounting Office (T-NSIAD- 87–2/10 12 1986).Google Scholar

6 In addition to the bodies already mentioned Expo was co-organized by Montenegro Saatchi & Saatchi Compton, S.A., a Mexico City advertising agency. The American Chamber of Commerce in Mexico (AmCham), two banks (BANAMEX and BANCOMER), and the Ministry of Commerce and Industry (SECOFI) were “Mexican Honorary Sponsors.”

7 A series of lengthy Department of State “Airgrams” received from the Embassy in Mexico City makes it quite clear that Embassy staff were visiting the border area regularly and consulting with Mexican maquila officials and US managers.

8 Cited in Golden, Arthur, “Promotion of Mexico Plants Hit,” San Diego Union, 24 08 1986Google Scholar. It is, therefore, beyond doubt that this was a US show and that, while the maquila program has no legal status in the United States, US officials frequently give it quasi-official backing.

9 In Lindquist, Diane, “Commerce Dept. may exit maquiladora expo,” San Diego Union, 23 10 1986, C-2.Google Scholar

10 Cited in Mendelowitz, 10. It was reported in the press that this wording had been inserted into the spending bill to kill Expo Maquila 1986, but the account of Mendelowitz shows that the restriction was already in force.

11 See, for example, Evansville Courier, 28 10 1986Google Scholar. The union campaign was widely criticized in Mexico and led one newspaper, Ultimas Noticias, to describe the UAW advertisement as a “low blow” and signalling a “U.S. union offensive against Mexico” (as reported in San Diego Union, 30 10 1986, E-I, 2).Google Scholar

12 Mendelowitz, 12. See also “Memorandum for all regional managing directors,” Message 414–1 of 18 11 1986Google Scholar, subject Expo-Maquila, on file at Department of Commerce offices.

13 All of these comments, and more, are quoted in “Twin Plants argument escalates,” El Paso Times, 26 11 1986, 1A.Google Scholar

14 See United States Congress, Hearings. Commerce Department's Promotion of Mexico's Twin Plant Program (Washington: Subcommittee on Economic Stabilization of the Committee on Banking, Finance, and Urban Affairs, 1986)Google Scholar. I have been able to find only one union leader, Henry Schickling of the 1,800 member International Tool, Dye and Mold Makers, who has publicly supported the maquila industry, on the grounds that “twin plants save US jobs,” quoted in Flaherty, Colin, “Union Leader: Twin-Plants Save US Jobs,” Frontier Business [San Diego, CA], 06–07 1987, 13.Google Scholar

15 United States International Trade Commission, The Impact of Increased United States-Mexico Trade on Southwest Border Development (Washington: USITC, 1986).Google Scholar

16 Quoted in Ritcher, B., “Maquiladoras can benefit U.S. and Mexico, Bentsen claims,” San Antonio Express-News, 27 11 1986.Google Scholar

17 For example, Diane Lindquist of the San Diego Union, quotes a manufacturer of wire harnesses to the effect that, despite an unemployment rate of 25% where he was presently manufacturing, the maquila option was a real alternative to Mississippi. “It boils down that the labour force there is twice as expensive as in Mexico. What incentive is the government giving us to stay?” (in San Diego Union, 6 12 1986, E–I, 2).Google Scholar

18 Kolbe, Jim, “Investment and the In-Bond Industry: Guideposts to Mexico's Economic Revitalization,” (Acapulco, 5 12 1986, 19, mimeo).Google Scholar

19 See Drucker, Peter, Managing in Turbulent Times (London: Heinemann, 1980)Google Scholar. This is, of course, the way that transnational capital justifies (ideologically, according to its critics), its part in the new international division of labour, for which see Frobel, F., Heinrichs, J., Kreye, O., The New International Division of Labour (Cambridge: Cambridge University Press, 1980)Google Scholar, and Grunwald, J., and Flamm, K., The Global factory: Foreign Assembly in International Trade (Washington: Brookings Institute, 1985).Google Scholar

20 Lazes, Peter, “Trico Product Corporation Studies,” (New York: Cornell University Programs for Employment and Workplace Systems, 1986, mimeo)Google Scholar. This case is discussed in detail in Sklair, , Assembling for Development, Chap. 6.Google Scholar

21 Sanderson, Susan, “American Industry Can Go Home Again,” Across the Board (02 1986), 38–43Google Scholar, argues that though US manufacturing industry is now totally dependent either on foreign assembly or components from cheap labour sources, increasing automation will soon do away with the need for the maquila-type industries in Third World countries. For a critique of this view, see Sklair, Chap. 10.

22 This statement is in the covering letter with the questionnaire distributed to maquilas in Juarez in early 1986.

23 About 85% of maquila plants and employees were to be found along the border at that time, though there are signs that the maquila industry in the interior may be growing faster than that on the border (see Sklair, Chap. 7). First results of the BTA survey, based on a sample of 140, were circulated by the El Paso Chamber of Commerce in 1987. A second set, based on 163 responses, will be found in Border Trade Alliance, “Maquiladora Impact Survey: Findings and Conclusions” (El Paso: University of Texas, Department of Marketing; and Foreign Trade Association, 1987, mimeo).Google Scholar

24 Oddly, in the earlier presentation of results, an introductory graphic neatly included Texas in the top ten by the simple device of leaving out Ohio. This is a good example of the pride of localism obscuring clear vision! By the time all the responses were in Texas had, indeed, made tenth place.

25 It is hardly surprising that the BTA, a promotional body, does not wish to draw attention to the issue of job losses. It specifically admits: “The data cannot account for job dislocations that are attributable to the maquiladora industry” (Border Trade Alliance, “Maquiladora Impact Survey,” 4).

26 Anand, V., “Mexican Border Plants Support U.S. Trade,” Global Trade, (06 1987), 34–5Google Scholar. Methodologically, it would be relatively simple to correct this. Criteria of dependence of US suppliers on Mexican maquilas could be established. For example, it could be argued that the jobs in any US firm that relied on its maquila business for, say, one third or more of its turnover, might be considered to be “sustained” by the maquila industry. That the BTA Survey fails to investigate such issues points up its promotional nature.

27 Eckhouse, John, “Special Report. Industrial Boom at the Border,” San Francisco Chronicle, 29 02 1988, A–6.Google Scholar

28 BTA “data” on maquila-induced job retention and creation were being widely circulated by the BTA as information on the maquila industry. For examples of how they were picked up and used by newspapers and magazines, see my Maquiladoras: Annotated Bibliography and Research Guide to Mexico's In-Bond Industry (University of California, San Diego: Center for U.S.-Mexican Studies, 1988), Part Three.Google Scholar

29 See Cavazos, R. Daniel, “Maquila giants low key in fight,” Brownsville Herald, 23 01 1987, 1B.Google Scholar

30 For an interesting account of the passing of such a resolution in the San Diego City Council see Los Angeles Times, 18 02 1987, II, 4Google Scholar. For similar resolutions in the Lower Rio Grande Valley see Brownsville Briefing Book (Brownsville, Texas: Border Trade Alliance, 1987), Part V.Google Scholar

31 This was due to the fragmented nature of the maquila industry in Tijuana compared with other sites along the border, for reasons discussed in Sklair, , Assembling for Development, Chap. 4.Google Scholar

32 This is a lobbying organization first established as the “Committee for [U.S. Tariff Items] 806.30 and 807” in 1976, whose “mission” according to its publicity material “is to foster the improvement of US competitiveness by combining technology and US content in partnership with developing country labor and skill.” The Committee is credited with helping to organize the BTA in an article in the El Paso Times, 29 03 1987.Google Scholar

33 See Don Hagans's report in the El Paso Foreign Trade Association newsletter, Paso del Norte Trade News (06 1987), 4.Google Scholar

34 The headline on a New York Times front page story on the maquilas, “U.S. Goods Made in Mexico Stir Concern on Jobs,” 29 12 1986Google Scholar, could not have pleased the BTA, though the editorials in the Times in the following week, “Hecho en Mexico,” 5 01 1987Google Scholar, and in Business Week, “Keeping Jobs in Mexico Benefits the US,” 19 01 1987Google Scholar, were both highly supportive of the maquilas. It is interesting to note that the New York Times editorial was widely reported in the Mexican press, for example in La Jornada, UnomasUno, and El Mexicano (all on 6 January 1987). I do not know whether the BTA provided material for any of this coverage, but it is certainly possible.

35 See Mexican-American Review (05 1981), 35.Google Scholar

36 It is worth remembering – as noted above – that many maquilas already use foreign, mainly Asian components, and that if the expected rapid rise in Japanese and other Asian-owned maquilas actually occurs, it is bound to increase this tendency.

37 The issue was prominent in the Democratic primary campaigns in 1987–8, and was picked up again in October 1988 by the previously “free-trading” Dukakis in a despairing bid to secure the rustbelt working class vote.

38 In signing the Trade Bill, widely regarded abroad as at least partly protectionist, into law on 23 August 1988, President Reagan bafflingly remarked: “Protectionism protects no one, not even the special interests that want it so much,” (Statement circulated by the United States Embassy in London, dated 23 08 1988, mimeo, 2.)Google Scholar

39 See Business Week, 4 07 1988, 34Google Scholar, and The Economist, 16 07 1988, 34.Google Scholar