On Friday, January 23, 2004 the Migration Policy Institute (MPI) hosted a briefing, featuring Thomas F. McLarty, President of Kissinger McLarty Associates and former advisor to Presidents Carter, Bush, and Clinton; Carlos Felix, Minister of Migration Affairs, Embassy of Mexico; Demetrios G. Papademetriou, MPI Co-Director and co-founder, and Doris Meissner, Senior Fellow at MPI and former INS Commissioner. The breakfast briefing was in honor of the 10th anniversary of the North American Free Trade Agreement (NAFTA). Mr. McLarty moderated the panel.

At the briefing, MPI distributed "The Shifting Expectations of Free Trade and Migration" by Demetrios G. Papademetriou from the recent Carnegie Endowment for International Peace report, NAFTA's Promise and Reality: Lessons from Mexico for the Hemisphere.

Thomas McLarty: Opening Remarks and Introduction

McLarty began the briefing with an overview of the White House thinking at the time of NAFTA's passage in the early 1990s and then went on to discuss the current immigration situation between the two countries and in the United States.

McLarty noted the bilateral partnership, starting with the first Bush administration and continuing through the Clinton administration, which existed to help place Mexico on an outward growing path. NAFTA was one of the first items to receive attention under the Clinton administration during the earliest months of his first term. The passage of NAFTA required strong leadership and sufficient capital, both of which were provided by Clinton's team. Even though it was mainly a trade agreement, NAFTA clearly had broader geo-political benefits: to strengthen a partnership with Mexico.

McLarty remarked that at the time NAFTA was passed, the issues of migration and immigration were present, but they were not as "hot" as they are now. President Clinton wanted to close the income gap between the United States and Mexico, and to extend benefits to Mexico including opportunities for Mexicans to stay and work in their home country. McLarty recognized that, over the past decade, migration from Mexico to the United States has increased - particularly the number of undocumented workers-and asserted that the trade agreement would benefit from a review, perhaps resulting in a broadening of the original agreement.

In terms of the current immigration reform debate, McLarty gave President Bush credit for putting a divisive issue on the table and claimed that while some individuals have concerns about the proposal, it will certainly help to draw unauthorized workers out of the shadows. McLarty noted that the recently proposed bipartisan Daschle/Hagel bill (officially called the Immigration Reform Act of 2004) gives hope for Congressional action this year and takes the important step of recognizing undocumented immigrants as "invested stakeholders." "This is not just about statistics," he said, "it is about real lives and families and so a balance needs to be struck and policies need to reflect that balance."

Demetrios Papademetriou

Papademetriou spoke about the research and findings in his chapter on NAFTA's effects on migration in NAFTA's Promise and Reality: Lessons from Mexico for the Hemisphere and its implications for migration management today.

The report, Papademetriou noted, took stock of the expectations of the Mexican and American governments in the mid-1990s and tried to see if these expectations matched up with performance a decade later. Issues examined included:

• Has US/Mexican migration changed over the past 10 years and, if so, why?
• What is the impact of NAFTA on migration and what lessons can be learned for future trade agreements, in particular the Central American Free Trade Agreement and the Free Trade Agreement of the Americas that, whether explicitly or implicitly, link trade with migration?
• How should migration be managed in a bilateral and regional context?

The findings of the evaluation showed that during negotiations both governments had inevitably looked past the economic merits of NAFTA with the hope that the agreement might also bring about measurable effects on other tangentially related issues.

Since the passage of NAFTA, however, the past decade has witnessed a doubling of undocumented immigrants in the United States. The greatest majority of these workers are Mexicans-who are estimated to make up more than 50 percent of the total 9-10 million undocumented immigrant population in the United States.

Papademetriou asserted, however, other forces - which predated NAFTA or have developed since - that are responsible for these migration changes including:

• Structural adjustment in Mexico since the 1980s - regularity of financial crises, the recent recovery from the peso devaluation and the change from a closed to open market have had profound consequences on migration
• An economic boom in the US during the late 1990s that created a huge number of surplus jobs
• A demographic boom in Mexico coupled with a strong "migration inertia" northward. This migration network significantly linked the economies and societies of both nations.

Papademetriou concluded by saying that NAFTA will always be a work in progress and that 10 years of enactment can only provide a short- to mid-term analysis of the trade agreements effects on migration. He suggested that perhaps the migration-related expectations of both governments were unrealistic when analyzed from the trade agreement framework.

Doris Meissner

Meissner spoke about the expectations of NAFTA and the events surrounding its passage from her experiences as INS Commissioner from 1993-2000. She stressed the importance of evaluating NAFTA in the long-run, stating that it would be 15-20 years before the real effects of migration pressures can be seen not only because of the timing of economic turn-around but also because of growth projections and demographics.

Meissner noted that there is no immediate "quick fix" for migration but that NAFTA represents a crucial direction for the United States and Mexico. The agreement demonstrates a dramatic departure from previous policies between the two countries-by claiming that Mexican and American "destinies are tied," there was an acknowledgement of the impact the agreement would have on future communication and action by the neighboring countries.

From the US perspective, NAFTA brought about an enhanced cooperation with Mexico that was upheld by the INS. Meissner recognized the INS' commitment to remove immigration as an issue in certain political situations and its dedication to manage related tensions by taking programmatic steps to keep immigration issues on the front burner.

Meissner concluded by stating that she hopes discussions related to NAFTA will continue to go beyond labor issues to include opportunities to revitalize broader understanding and consideration of how the United States and Mexico are intertwined, particularly when it comes to narrowing the wage gap.

Carlos Felix

Minister of Migration Affairs Carlos Felix discussed how Mexico has transformed its economic structure but also its economic openness over the past decade. NAFTA created important relationships with the United States that enabled Mexico to purchase 14 percent of total American exports and provide 12 percent of total US imports. Felix remarked that NAFTA is a useful tool for the Mexican economy and that there has been an intense process of exchanges and expanded links between Mexico and societies abroad during the past decade. NAFTA was a solid and beneficial agreement that was followed by many other free trade agreements.

In terms of NAFTA and immigration, Felix noted that Mexico intended to include migration issues in the agreement but due to political adversity any discussion was taken off the table. Perhaps it was a lost opportunity, he asserted, but free trade and migration are different processes and need to be considered accordingly.

Felix stated that the most important aspect of the bi-national relationship continues to be the cooperation between the two countries in order to resolve issues related to the suffering of undocumented individuals. NAFTA was not a magic wand with the ability to solve all problems. Ultimately, it was not the right framework to deal with migration.

Discussion

One participant asked the panelists to assess the recent Senate bipartisan proposal from Senators Daschle and Hagel. What kinds of changes need to happen for this to be ratified?

Papademetriou emphasized that changing the status quo will be a long and arduous process. This most recent bill serves as a starting point for immigration reform and yet it is unrealistic to expect comprehensive reform in 2004. The President, through his recent statement, has put immigration questions back on the policy and political agenda. Now it is up to immigration enthusiasts to ensure that practical immigration legislation moves forward with a deliberate pace. There are several bills on the hill pending that have bipartisan support and, if enacted, could also act as an impetus for larger reform. It is good to demonstrate that we can pass immigration reform even if it is not comprehensive; consider it to be a "down payment" of what is to come.

Felix agreed with Papadmetriou that the current proposals are the beginning of a process. Expectations were very high that huge change would come immediately, but this is not possible despite the excitement to move forward. Immigration reform is a process that takes time; there is now an opportunity to promote this agenda but proponents must be practical. The attitudes of the key actors-positive, compromising and forward looking-are essential to the process.

McLarty added that the current landscape and environment for this kind of change are much better than we could have hoped, considering the attacks of September 11. We are committed to a partnership but it will be a marathon. This lengthy process, however, shouldn't deter our support for progress on a bipartisan basis.

A second question concerned how Mexico might benefit if it could keep its people at home for domestic production. Wouldn't it better for the US economy to make that adjustment now instead of subsidizing further production?

Papademetriou suggested that in an ideal world, yes, more jobs in Mexico for increased production there would be good. But in reality, the systems that are in place now are the ones that bring people into our country. The deciding factor is the wages; low productivity leads to low pay. This results in massive migration from Mexico to the United States.

A member of the audience asked what the next steps to broaden NAFTA would be.

McLarty said that NAFTA was a good agreement, and is still a sound one, though it could be updated. Certain sections could be removed or strengthened, including legal provisions, some environmental sections and some provisions on migration.

One participant wondered whether, given demographic and economic factors, it is realistic to expect that Mexican/US migration will ever end. What are public attitudes towards NAFTA and its perceived impact? Are politicians being honest with the American people?

Papademetriou stated categorically that migration will not end. Migration is a social process and it depends on social and economic contacts. He suggested that what is needed is a migration relationship that is better managed. This is within grasp-not 5-10 years- but in the future. He noted that the current President has been more honest than any other on this issue.

Meissner concurred that migration will not end; no one wants it to end. It is an evolution. Current migration is a result of needs, opportunities, and family connections. However, extreme gaps (in wages and income) need to be reduced. President Bush has taken a risk, and any workable immigration proposal must be part of a broader rationalization and reconciliation of migration policy. Bipartisan support is key-nothing will change if it is not present. The first steps toward legislation are key.

The final question was whether the Department of Labor has the institutional capacity to deal with this issue and whether it will do so.

Papademetriou said that, currently, the Department of Labor has no resources or capacity to deal with what the President has requested.