NAFTA SS6E2 The student will give examples of how voluntary trade benefits buyers and sellers in Latin America and the Caribbean and Canada c. Explain the functions of the North American Free Trade Agreement (NAFTA)

Situation 1 Steven owns a business in Alabama that makes specialty candles. Until NAFTA was adopted, he always bought his wax at the cost of $20 a case, from Bob, a supplier in Georgia. After NAFTA was adopted and tariffs on Mexican products were lifted, he realized he could get wax from Raul, in Mexico for $18 a case. Steven started buying his wax from Raul.

Situation 1 1. Did NAFTA help or hurt Steven? 2. Did NAFTA help or hurt Bob? 3. Did NAFTA help or hurt Raul?

Situation 2 Daniel worked at a Crayola crayon factory in Alberta, Canada for 23 years. He was a member of a union, earned $18 an hour, had great medical benefits, and a retirement plan. Daniel is now unemployed because after NAFTA was adopted, the Crayola factory was shut down, and moved to Mexico. This decision was made because a new plant could be built there, workers trained, products produced and shipped back to the United States, and still cost less per box to the owners of Crayola. In fact, it cost so much less, they were able to cut the price to consumers, like Sherry, an art teacher in Georgia. They were able to do all this, and still make more profit.

Situation 2 1. Did NAFTA help or hurt Daniel? 2. Did NAFTA help or hurt the workers at the new factory in Mexico? 3. Did NAFTA help or hurt Sherry? 4. Did NAFTA help or hurt the owners of the Crayola factory?

Situation 3 Rod Gibson is the owner of the Fostoria Times newspaper, in Fostoria, Ohio. He buys the newsprint (the paper used in making newspapers) for his paper from Sarah in Quebec, Canada. Before NAFTA, quotas would only allow Sarah to ship enough newsprint for a month’s worth of papers. Since NAFTA was adopted, and the quotas were lifted, Rod now buys newspaper for six months at a time, so only has to pay shipping charges twice a year, instead of 12 times a year. George, the truck driver who delivers the newsprint from where it is produced in Quebec, and gets paid by the number of miles he drives now has to work a second job because he drives so many fewer miles.

Situation 3 1. Has NAFTA helped or hurt Rod? 2. Has NAFTA helped or hurt Sarah? 3. Has NAFTA helped or hurt George?

State your opinion Is NAFTA a good thing, or a bad thing?