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Thread: Wheat, Corn, and How NAFTA hurt the Mexican poor

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    Anders Hoveland's Avatar
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    Wheat, Corn, and How NAFTA hurt the Mexican poor

    Most economists say that Free Trade and lower prices will help the poor, but here's an example where that's not the case.

    In Mexico, there are two main types of crops, wheat and corn. Without expensive modern harvesting machines, for Mexican farmers wheat is more labor intensive but it can be grown almost anywhere. Corn is an important food in Mexico, it is turned into corn flour, tamales and tortillas, that is the traditional food of the Mexican. Corn requires more water so the places where it is commercially suitable for growing is much more limited.

    After NAFTA was passed and the corn and wheat in Mexico became exposed to American Markets, the price of wheat flour fell dramatically, while the price of corn skyrocketed. America is one of the leading world exporters of wheat to the rest of the world, with its vast fields and modern harvesting machines. But the American market also has an insatiable to appetite for corn, to turn into corn syrup and government-mandated ethanol.


    http://www.seattletimes.com/nation-w...corn-tortilla/

    It became difficult for the Mexican poor to afford their traditional food, corn flour. This was such an important issue that there were angry demonstrations in the streets. Meanwhile, poor Mexican farmers could not compete with the low cost American exports of wheat, their meager livelihoods were ruined, and this was a large contributor to so many poor peasant farmers migrating across the border to the U.S.


    http://www.banderasnews.com/0801/nr-borderblockade.htm

    You might ask why farmers in Mexico and the U.S. can't just plant more corn instead of wheat, but it does not work that way. In most of the places where wheat is grown it's not so easy to grow corn, corn requires more water. And in the Northern plains of America where water is a bit more plentiful, corn does not grow well in the colder climate. You might also ask why poor people in Mexico can't just start eating more wheat instead of corn. First of all, corn is the traditional food, that's what they are used to and what they like. But the other thing that you have to realize is the poor in Mexico tend to be more descended from the original inhabitants of Mexico (like Aztec) before Europeans came. Several studies have shown that these people are not able to digest wheat as well, and there are higher rates of gluten intolerance, so there may well be a legitimate physiologic reason they prefer tortillas and tamales.

    Free Trade brought other types of jobs to Mexico, but these jobs were not always better than the ones they replaced. At least wheat farmers had much more independence over their work and could typically own their own farm. Growing corn requires much more water, so the land where it is grown in Mexico is much more expensive.

    A single wheat harvesting machine used in a typical modern American wheat field can cost $100,000 so you can see why in Mexico, with agricultural workers typically earning less than 75 pesos a day, it wouldn't be that much more profitable to use the most modern labor-saving machinery. (It also helps keep money in the local communities, since many of the small towns in Northern Mexico have very high unemployment rates)
    Last edited by Anders Hoveland; 10-06-2016 at 01:43 PM.

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    Quote Originally Posted by Anders Hoveland View Post
    Most economists say that Free Trade and lower prices will help the poor, but here's an example where that's not the case.

    In Mexico, there are two main types of crops, wheat and corn. Without expensive modern harvesting machines, for Mexican farmers wheat is more labor intensive but it can be grown almost anywhere. Corn is an important food in Mexico, it is turned into corn flour, tamales and tortillas, that is the traditional food of the Mexican. Corn requires more water so the places where it is commercially suitable for growing is much more limited.

    After NAFTA was passed and the corn and wheat in Mexico became exposed to American Markets, the price of wheat flour fell dramatically, while the price of corn skyrocketed. America is one of the leading world exporters of wheat to the rest of the world, with its vast fields and modern harvesting machines. But the American market also has an insatiable to appetite for corn, to turn into corn syrup and government-mandated ethanol.


    http://www.seattletimes.com/nation-w...corn-tortilla/

    It became difficult for the Mexican poor to afford their traditional food, corn flour. This was such an important issue that there were angry demonstrations in the streets. Meanwhile, poor Mexican farmers could not compete with the low cost American exports of wheat, their meager livelihoods were ruined, and this was a large contributor to so many poor peasant farmers migrating across the border to the U.S.


    http://www.banderasnews.com/0801/nr-borderblockade.htm

    You might ask why farmers in Mexico and the U.S. can't just plant more corn instead of wheat, but it does not work that way. In most of the places where wheat is grown it's not so easy to grow corn, corn requires more water. And in the Northern plains of America where water is a bit more plentiful, corn does not grow well in the colder climate. You might also ask why poor people in Mexico can't just start eating more wheat instead of corn. First of all, corn is the traditional food, that's what they are used to and what they like. But the other thing that you have to realize is the poor in Mexico tend to be more descended from the original inhabitants of Mexico (like Aztec) before Europeans came. Several studies have shown that these people are not able to digest wheat as well, and there are higher rates of gluten intolerance, so there may well be a legitimate physiologic reason they prefer tortillas and tamales.

    Free Trade brought other types of jobs to Mexico, but these jobs were not always better than the ones they replaced. At least wheat farmers had much more independence over their work and could typically own their own farm. Growing corn requires much more water, so the land where it is grown in Mexico is much more expensive.

    A single wheat harvesting machine used in a typical modern American wheat field can cost $100,000 so you can see why in Mexico, with agricultural workers typically earning less than 75 pesos a day, it wouldn't be that much more profitable to use the most modern labor-saving machinery. (It also helps keep money in the local communities, since many of the small towns in Northern Mexico have very high unemployment rates)
    Thank you for bringing this to light.
    A couple of points, there is no such thing a "Free Trade", the same people who foisted this disaster, gave us ACA. While I don't doubt your statements and conclusions can you site any references.
    And finally why did the price of corn "skyrocket" but wheat declined?

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    The biggest legal employer in Mexico today is WalMart.

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