Warm Up: What is the message of the cartoon?

Wednesday, January 30, 2019 Objective: Students will be able to evaluate the effects of free trade agreements. Purpose: Free trade makes it cheaper to do business in other countries but also has drawbacks.

Free Trade Free Trade: the lowering or elimination of protective tariffs and other trade barriers between two or more nations Advantages Allows for access to more markets. Increased competition and elimination of businesses that are not competitive. Lowers prices for consumers, because the cost of tariffs in not passed on to consumers.

Free Trade Areas European Union (EU) No tariffs or trade restrictions on trade between member nations EU policies aim to allow the free movement of people, goods, services, and capital in a single continental market Individual members cannot negotiate trade deals on their own North American Free Trade Agreement (NAFTA) free trade agreement between Canada, Mexico, and the United States

What are the costs of free trade? individual countries lose some autonomy in that they have to go along with policies of the agreement, whether individually advantageous or not. By excluding certain countries, these agreements may shift the composition of trade from low-cost countries that are not party to the agreement to high-cost countries that are. Some argue that such agreements serve the interests of multinational corporations and not workers.

The European Union

Views on NAFTA Opponents worried that American companies would move factories to Mexico, where wages were lower and environmental regulations were less strict Supporters of NAFTA claimed that the measure would instead create more jobs in the United States, because it would increase exports to Mexico and Canada.

Critics attribute U.S. job loss, particularly in manufacturing industries, to NAFTA. What is the cartoon saying about how some people feel about NAFTA?

Future of NAFTA President Trump has called for the agreement to be renegotiated so the U.S. received a “better deal” If a better deal is not reached, Trump has threatened to pull out of NAFTA and charge a 35% tariff on goods from Mexico Dramatically changing the pact could threaten up the 6 million American jobs that rely on trade with Canada and Mexico Trump’s 20% tax to fund the proposed border wall is not allowed under NAFTA rules

Future of NAFTA Changing labor standards in NAFTA could bring some jobs back to the U.S. The three North American countries are closely integrated in many manufacturing sectors Tariffs or any other trade barriers could make the entire North American market less competitive Any introduction of trade barriers on goods from Canada and Mexico would result in higher prices for consumers

https://www.youtube.com/watch?v=9AXNGus16yo