April 2021, Volume 27, Number 2
The first labor complaint under the USMCA was filed in March 2021 by the Centro de los Derechos del Migrante and other worker NGOs with the Mexican DOL (STPS). It alleged that US employers unlawfully discriminate against women, especially in the H-2A program. Some 9,000 farm employers employed 213,000 H-2A workers in FY20, including 94 percent Mexicans.
Over 95 percent of H-2A visas are issued to men, in part because employers must offer H-2A workers housing and do not want to develop separate housing by sex. The NAWS finds that 70 percent of US crop workers are male. CDM alleges that US farm employer preferences for men is evidence of ?discrimination in respect of employment and occupation? prohibited by USMCA Article 23.3.
The CDM complaint alleges that women in the US on H-2A and H-2B visas are shunted into lower-wage jobs and are subject to physical and sexual harassment that is not investigated or remedied by US enforcement agencies. The CDM wants more oversight of employer recruitment abroad, new avenues for H-visa workers to file complaints, and more enforcement of US labor laws.
Canada. Housing prices are rising in 2021, to a record C$1.6 million for a detached house in Vancouver and over C$1 million in Toronto. Housing prices were expected to drop due to the pandemic, but rose because higher income people who were able to work remotely had increased savings to invest in housing.
Housing accounts for almost 10 percent of Canadian GDP and five percent of US GDP. Some economists fear that too much investment in housing reduces business investment that increases labor productivity.
Canada protects its dairy industry. Covid lockdowns increased the demand for butter, and Canadian farmers responded by adding more palm oil supplements to animal feed to increase milk output and the fat content of the milk. The result was harder butter that was more difficult to spread on toast and criticism that Canadians were paying high prices for butter produced with the help of a supplement that could be destroying tropical forests in Indonesia and Malaysia.
Mexico. President Andr?s Manuel L?pez Obrador was slow to congratulate President Joe Biden. AMLO?s government demanded the return of a former defense minister who was arrested in Los Angeles in 2020 for aiding drug smugglers, and exonerated him in 2021 after calling the US evidence ?fabricated.?
AMLO and Trump forged a working relationship based on Mexico preventing Central Americans from reaching the US. For its part, the US ignored drug violence in Mexico and AMLO?s weakening of checks and balances in his government.
AMLO had a virtual meeting with President Biden in March 2021 during which he proposed a new Bracero program that would allow 600,000 to 800,000 Mexicans and Central Americans a year to work temporarily in the US. AMLO in Zacatecas said: ?We are better at ordering the migratory flow, legalizing it, and giving workers a guarantee that they do not risk their lives, that human rights are protected.? Biden said a new guest worker program would require legislation.
AMLO tested positive for Covid in January 2021, but continued to downplay the threat of the virus even as Mexican deaths topped 155,000, third after the US and Brazil. Some Covid-related deaths are not reported because many Mexicans distrust hospitals and remain at home, so their deaths may not be attributed to Covid. Brazil and Mexico, along with the US, are near the bottom in rankings of how well governments responded to the pandemic, while New Zealand, Vietnam, and Taiwan rank at the top.
AMLO sent Covid vaccines first to people in rural and marginalized communities rather than in the cities with the most Covid cases, in some cases using unvaccinated health care workers to vaccinate residents in areas with few Covid cases. Priority for vaccines vary by state, so that teachers are first in line in several states with elections in 2021. With 8.2 percent of the world?s people, Latin America and the Caribbean had a third of the deaths from Covid through Fall 2020. Meanwhile, the wealth of the region?s 73 billionaires increased as stock prices rose.
AMLO?s government in Spring 2020 decided not to lock residents in their homes because 55 percent of Mexicans work in the informal sector and thus lack access to unemployment insurance. There were also fears that using police to enforce lockdowns could lead to abuse at the hands of police enforcing stay-at-home rules. Mexico had 19.8 million workers registered with IMSS, a common definition of formal sector jobs, at the beginning of the pandemic. The Mexican economy shrank by 8.5 percent in 2020.
Mexico had well regarded conditional cash transfer programs known as Progresa (1997-2002), Oportunidades (2002-14) and Prospera (2014-19). Benefits were paid to working age mothers who kept their children in school and had their children?s health checked regularly in a bid to reduce the intergenerational transmission of poverty.
AMLO replaced Prospera with three programs for 16 million non-working poor residents, including cash programs for poor school children, unemployed youth, and those 65 and older. Based on a poverty line of $5.50 a day, the share of Mexicans in poverty is about 42 percent in 2021.
AMLO is undertaking several large projects that critics fear will become white elephants, including the 1,550 km and $8 billion Maya train and an $8 billion oil refinery in Tabasco. AMLO promised a fourth revolution when elected in 2018 to eliminate corruption and ensure six percent annual economic growth, but critics fear that he is recreating an authoritarian party in the mold of the Institutional Revolutionary Party (PRI), that emerged from Mexico?s civil war in the 1910s.
AMLO in March 2021 asked why Mexico has become the world?s leading exporter of beer, sending $4.6 billion worth to the US. AMLO, who in 2020 cancelled a partially built brewery after a referendum in Mexicali that would have exported Corona beer, said that Mexico?s arid north cannot export water-intensive products such as beer.
Mexico has 50 consulates in the US to serve 40 million people, including about 12 million people born in Mexico and 28 million Mexican-Americans.
Census. Mexico had 126 million residents in 2020, up 12 percent from 112 million in 2010. Some 1.2 million Mexican residents were born abroad, including two-thirds in the US.
The population rose 1.2 percent over the decade, down from three percent in the 1960s and 1970s. The census reported that fertility averaged 2.1, down from 2.6 in 2000. The average age of Mexican residents was 29, up from 22 in 2000. The average level of schooling was 9.7 years in 2020, up from 7.5 years in 2000. Some 7.4 million residents speak an indigenous language, 6.1 percent of residents.
The most populous state was Mexico state with 15 million residents; Colima with 730,000 people had the fewest. Baja California had 49,000 speakers of indigenous languages in 2020, including almost half Mixtecs from Oaxaca. An estimated 90,000 Mixtecs migrate within Mexico to do farm work, including a peak 22,000 in San Quintin in Baja.
Two-thirds of Mexico is arid; water scarcity is most acute in northern states. Mexico has 400 of the 18,200 desalination plants around the world, and is adding over 100 more in water-scarce states such as Baja California. Critics of the brine produced by desalination want more done to reduce water loss due to leaking pipes and more effort made to capture rainwater.
The AMLO government announced that it would aim to replace the 16 million tons of imported US corn, most of which is grown with genetically modified seeds, with non-GMO Mexican-produced corn by 2024. AMLO also wants to ban glyphosate, the active ingredient in Roundup.
AMLO?s government is reversing 2014 reforms that opened the energy and electricity sectors to private investment and competition. Under March 2021 legislation, instead of buying the lowest-cost energy to feed the electrical grid, power produced by the Federal Electricity Commission (CFE) would have to be purchased first, even if it is more expensive than private power available from wind, solar and other private plants.
AMLO says that Mexico must become self-sufficient in food and energy, even if costs rise and pollution increases as CFE burns the bunker fuel from Mexico?s heavy oil to generate electricity. CFE signed a new collective bargaining agreement with its union in 2020 that lowered the retirement age from 65 to 55. CFE lost almost $4 billion in 2020, and critics say that, like PEMEX, it will soon be an indebted state-owned business.
Convenience store chain Oxxo began in 1978 as a way to sell what is today FEMSA beer, recruiting Mexican families to operate the stores that spread from north to south. Oxxo has become the third most valuable brand in Mexico, behind Corona and Telcel, and sells many store brands. Oxxo says that its 20,000 stores in Mexico?s 43 states have over 13 million customers a day. Over the past two decades, Oxxo adding banking services that allow people to pay for utilities and other services and send and receive money. FEMSA is Mexico?s Coca Cola bottler.
Northern Triangle. President Biden promised $4 billion in aid to promote stay-at-home development in El Salvador, Guatemala and Honduras, the source of many families and solo youth who travel through Mexico and seek asylum at the US border with Mexico.
Biden appointed Vice President Kamala Harris to lead the effort to address the root causes of emigration, including gang activities that generate some of the world?s highest homicide rates, corruption and impunity from prosecution, and natural disasters such as destructive hurricanes. As Vice President, Joe Biden led a similar effort during the Obama administration to deal with the root causes of Central American migration. Most of the US aid provided during the Obama administration proved ineffective at reducing migration.
The US wants to promote democracy and development in the region, and has done so with programs beginning with the Alliance for Progress in the 1960s. In recent years, the US government has been funding NGOs rather than governments to strengthen the rule of law and the impartial administration of justice. Biden?s $4 billion would double current funding levels.
Why have past funding efforts produced so few visible results in the Northern Triangle? There are many reasons, including the corruption rooted in political and economic systems that are marked by clientelism, authoritarian practices, state-sponsored violence, and disrespect for the rule of law. However, much of the US aid money appropriated has not been spent because local partners have been unable to implement their programs in ways that satisfy US accounting standards.
Servicing El Salvador?s foreign debt takes a high share of the federal government?s revenue, and the country?s tax system gets relatively little money from its richest citizens.
Some Central American teens who travel through Mexico to the US are intercepted by Mexican authorities and returned to their countries of origin. Mexican border cities have shelters to hold solo children until they are returned home.
Brazil. One year after governments reacted to the Covid pandemic in March 2020, there were over 300,000 Covid-related deaths in Brazil. Leaders including President Jair Bolsonaro played down the threat, calling it no worse than the flu, and refused to order lockdowns.
By March 2021, new Covid variants filled intensive care beds and led to over 125 deaths a day. However, with 40 percent of Brazilians in informal jobs, leaders refused to order lockdowns so that informal workers could earn enough to survive, prompting demonstrations in favor of and opposed to lockdowns. Many Brazilians believe that China created and spread the virus in order to sell more medical supplies, including the Chinese-made CoronaVac vaccine that Brazil is using to vaccinate its people.
Colombia. The government in February 2021 announced that more of the 1.7 million Venezuelans in the country could apply for 10-year work and residence permits. Colombia hosts 1.7 million of the 5.4 million Venezuelans who have left their country, but only 720,000 were registered before the Colombian government announced its new program.