[Weekly Compilation of Presidential Documents Volume 29, Number 37 (Monday, September 20, 1993)]
[Pages 1754-1759]
[Online from the Government Publishing Office, www.gpo.gov]

<R04>
Remarks at the Signing Ceremony for the North American Free Trade 
Agreement Supplemental Agreements

 September 14, 1993

    Thank you very much. Mr. Vice President, President Bush, President 
Carter, President Ford, ladies and gentlemen. I would like to 
acknowledge just a couple of other people who are in the audience 
because I think they deserve to be seen by America since you'll be 
seeing a lot more of them: my good friend Bill Daley from Chicago and 
former Congressman Bill Frenzel from Minnesota, who have agreed to lead 
this fight for our administration on a bipartisan basis. Would you 
please stand and be recognized.
    It's an honor for me today to be joined by my predecessor, President 
Bush, who took the major steps in negotiating this North American Free 
Trade Agreement; President Jimmy Carter, whose vision of hemispheric 
development gives great energy to our efforts

[[Page 1755]]

and has been a consistent theme of his for many, many years now; and 
President Ford, who has argued as fiercely for expanded trade and for 
this agreement as any American citizen and whose counsel I continue to 
value. These men, differing in party and outlook, join us today because 
we all recognize the important stakes for our Nation in this issue.
    Yesterday we saw the sight of an old world dying, a new one being 
born in hope and a spirit of peace. Peoples who for a decade were caught 
in the cycle of war and frustration chose hope over fear and took a 
great risk to make the future better.
    Today we turn to face the challenge of our own hemisphere, our own 
country, our own economic fortunes. In a few moments, I will sign three 
agreements that will complete our negotiations with Mexico and Canada to 
create a North American Free Trade Agreement. In the coming months I 
will submit this pact to Congress for approval. It will be a hard fight, 
and I expect to be there with all of you every step of the way. We will 
make our case as hard and as well as we can. And though the fight will 
be difficult, I deeply believe we will win. And I'd like to tell you 
why. First of all, because NAFTA means jobs, American jobs and good-
paying American jobs. If I didn't believe that, I wouldn't support this 
agreement.
    As President, it is my duty to speak frankly to the American people 
about the world in which we now live. Fifty years ago at the end of 
World War II, an unchallenged America was protected by the oceans and by 
our technological superiority and, very frankly, by the economic 
devastation of the people who could otherwise have been our competitors. 
We chose then to try to help rebuild our former enemies and to create a 
world of free trade supported by institutions which would facilitate it. 
As a result of that effort, global trade grew from $200 billion in 1950 
to $800 billion in 1980. As a result, jobs were created and opportunity 
thrived all across the world. But make no mistake about it, our decision 
at the end of World War II to create a system of global, expanded, freer 
trade, and the supporting institutions, played a major role in creating 
the prosperity of the American middle class.
    Ours is now an era in which commerce is global and in which money, 
management, technology are highly mobile. For the last 20 years, in all 
the wealthy countries of the world, because of changes in the global 
environment, because of the growth of technology, because of increasing 
competition, the middle class that was created and enlarged by the wise 
policies of expanding trade at the end of World War II has been under 
severe stress. Most Americans are working harder for less. They are 
vulnerable to the fear tactics and the averseness to change that is 
behind much of the opposition to NAFTA.
    But I want to say to my fellow Americans, when you live in a time of 
change the only way to recover your security and to broaden your 
horizons is to adapt to the change, to embrace it, to move forward. 
Nothing we do, nothing we do in this great capital can change the fact 
that factories or information can flash across the world, that people 
can move money around in the blink of an eye. Nothing can change the 
fact that technology can be adopted, once created, by people all across 
the world and then rapidly adapted in new and different ways by people 
who have a little different take on the way the technology works. For 
two decades, the winds of global competition have made these things 
clear to any American with eyes to see. The only way we can recover the 
fortunes of the middle class in this country so that people who work 
harder and smarter can at least prosper more, the only way we can pass 
on the American dream of the last 40 years to our children and their 
children for the next 40 is to adapt to the changes which are occurring.
    In a fundamental sense, this debate about NAFTA is a debate about 
whether we will embrace these changes and create the jobs of tomorrow, 
or try to resist these changes, hoping we can preserve the economic 
structures of yesterday. I tell you, my fellow Americans, that if we 
learned anything from the collapse of the Berlin Wall and the fall of 
the governments in Eastern Europe, even a totally controlled society 
cannot resist the winds of change that economics and technology and 
information flow have imposed in this world of ours. That is not an 
option. Our only realistic option is to embrace these changes and create 
the jobs of tomorrow.

[[Page 1756]]

    I believe that NAFTA will create 200,000 American jobs in the first 
2 years of its effect. I believe if you look at the trends--and 
President Bush and I were talking about it this morning--starting about 
the time he was elected President, over one-third of our economic growth 
and in some years over one-half of our net new jobs came directly from 
exports. And on average, those exports-related jobs paid much higher 
than jobs that had no connection to exports. I believe that NAFTA will 
create a million jobs in the first 5 years of its impact. And I believe 
that that is many more jobs than will be lost, as inevitably some will 
be, as always happens when you open up the mix to a new range of 
competition.
    NAFTA will generate these jobs by fostering an export boom to 
Mexico, by tearing down tariff walls which have been lowered quite a bit 
by the present administration of President Salinas but are still higher 
than Americas'. Already Mexican consumers buy more per capita from the 
United States than other consumers in other nations. Most Americans 
don't know this, but the average Mexican citizen, even though wages are 
much lower in Mexico, the average Mexican citizen is now spending $450 
per year per person to buy American goods. That is more than the average 
Japanese, the average German, or the average Canadian buys; more than 
the average German, Swiss, and Italian citizens put together.
    So when people say that this trade agreement is just about how to 
move jobs to Mexico so nobody can make a living, how do they explain the 
fact that Mexicans keep buying more products made in America every year? 
Go out and tell the American people that. Mexican citizens with lower 
incomes spend more money--real dollars, not percentage of their income--
more money on American products than Germans, Japanese, Canadians. That 
is a fact. And there will be more if they have more money to spend. That 
is what expanding trade is all about.
    In 1987, Mexico exported $5.7 billion more of products to the United 
States than they purchased from us. We had a trade deficit. Because of 
the free market, tariff-lowering policies of the Salinas government in 
Mexico, and because our people are becoming more export-oriented, that 
$5.7 billion trade deficit has been turned into a $5.4 billion trade 
surplus for the United States. It has created hundreds of thousands of 
jobs.
    Even when you subtract the jobs that have moved into the 
maquilladora areas, America is a net job winner in what has happened in 
trade in the last 6 years. When Mexico boosts its consumption of 
petroleum products in Louisiana--where we're going tomorrow to talk 
about NAFTA--as it did by about 200 percent in that period, Louisiana 
refinery workers gained job security. When Mexico purchased industrial 
machinery and computer equipment made in Illinois, that means more jobs. 
And guess what? In this same period, Mexico increased those purchases 
out of Illinois by 300 percent.
    Forty-eight out of the 50 States have boosted exports to Mexico 
since 1987. That's one reason why 41 of our Nation's 50 Governors--some 
of them who are here today, and I thank them for their presence--support 
this trade pact. I can tell you, if you're a Governor, people won't 
leave you in office unless they think you get up every day trying to 
create more jobs. They think that's what your job is if you're a 
Governor. And the people who have the job of creating jobs for their 
State and working with their business community, working with their 
labor community, 41 out of the 50 have already embraced the NAFTA pact.
    Many Americans are still worried that this agreement will move jobs 
south of the border because they've seen jobs move south of the border 
and because they know that there are still great differences in the wage 
rates. There have been 19 serious economic studies of NAFTA by liberals 
and conservatives alike; 18 of them have concluded that there will be no 
job loss. Businesses do not choose to locate based solely on wages. If 
they did, Haiti and Bangladesh would have the largest number of 
manufacturing jobs in the world. Businesses do choose to locate based on 
the skills and productivity of the work force, the attitude of the 
government, the roads and railroads to deliver products, the 
availability of a market close enough to make the transportation costs 
meaningful, the communications networks necessary to support the 
enterprise. That is our strength, and it will con- 

[[Page 1757]]

tinue to be our strength. As it becomes Mexico's strength and they 
generate more jobs, they will have higher incomes, and they will buy 
more American products.
    We can win this. This is not a time for defeatism. It is a time to 
look at an opportunity that is enormous. Moreover, there are specific 
provisions in this agreement that remove some of the current incentives 
for people to move their jobs just across our border. For example, today 
Mexican law requires United States automakers who want to sell cars to 
Mexicans to build them in Mexico. This year we will export only 1,000 
cars to Mexico. Under NAFTA, the Big Three automakers expect to ship 
60,000 cars to Mexico in the first year alone, and that is one reason 
why one of the automakers recently announced moving 1,000 jobs from 
Mexico back to Michigan.
    In a few moments, I will sign side agreements to NAFTA that will 
make it harder than it is today for businesses to relocate solely 
because of very low wages or lax environmental rules. These side 
agreements will make a difference. The environmental agreement will, for 
the first time ever, apply trade sanctions against any of the countries 
that fails to enforce its own environmental laws. I might say to those 
who say that's a giving up of our sovereignty: For people who have been 
asking us to ask that of Mexico, how do we have the right to ask that of 
Mexico if we don't demand it of ourselves? It's nothing but fair.
    This is the first time that there have ever been trade sanctions in 
the environmental law area. This ground-breaking agreement is one of the 
reasons why major environmental groups, ranging from the Audubon Society 
to the Natural Resources Defense Council, are supporting NAFTA.
    The second agreement ensures that Mexico enforces its laws in areas 
that include worker health and safety, child labor, and the minimum 
wage. And I might say, this is the first time in the history of world 
trade agreements when any nation has ever been willing to tie its 
minimum wage to the growth in its own economy. What does that mean? It 
means that there will be an even more rapid closing of the gap between 
our two wage rates. And as the benefits of economic growth are spread in 
Mexico to working people, what will happen? They'll have more disposable 
income to buy more American products, and there will be less illegal 
immigration because more Mexicans will be able to support their children 
by staying home. This is a very important thing.
    The third agreement answers one of the primary attacks on NAFTA that 
I heard for a year, which is, ``Well, you can say all this, but 
something might happen that you can't foresee.'' Well, that's a good 
thing, otherwise we never would have had yesterday. I mean, I plead 
guilty to that. Something might happen that Carla Hills didn't foresee, 
or George Bush didn't foresee, or Mickey Kantor or Bill Clinton didn't 
foresee. That's true. Now, the third agreement protects our industries 
against unforeseen surges in exports from either one of our trading 
partners. And the flip side is also true. Economic change, as I said 
before, has often been cruel to the middle class, but we have to make 
change their friend. NAFTA will help to do that.
    This imposes also a new obligation on our Government, and I'm glad 
to see so many Members of Congress from both parties here today. We do 
have some obligations here. We have to make sure that our workers are 
the best prepared, the best trained in the world.
    Without regard to NAFTA, we know now that the average 18-year-old 
American will change jobs eight times in a lifetime. The Secretary of 
Labor has told us, without regard to NAFTA, that over the last 10 years, 
for the first time, when people lose their jobs most of them do not go 
back to their old job; they go back to a different job. So that we no 
longer need an unemployment system, we need a reemployment system. And 
we have to create that. And that's our job. We have to tell American 
workers who will be dislocated because of this agreement, or because of 
things that will happen regardless of this agreement, that we are going 
to have a reemployment program for training in America. And we intend to 
do that.
    Together, the efforts of two administrations now have created a 
trade agreement that moves beyond the traditional notions of free trade, 
seeking to ensure trade that pulls everybody up instead of dragging some 
down while others go up. We have put the environ- 

[[Page 1758]]

ment at the center of this in future agreements. We have sought to avoid 
a debilitating contest for business where countries seek to lure them 
only by slashing wages or despoiling the environment.
    This agreement will create jobs, thanks to trade with our neighbors. 
That's reason enough to support it. But I must close with a couple of 
other points. NAFTA is essential to our long-term ability to compete 
with Asia and Europe. Across the globe our competitors are 
consolidating, creating huge trading blocs. This pact will create a free 
trade zone stretching from the Arctic to the tropics, the largest in the 
world, a $6.5 billion market with 370 million people. It will help our 
businesses to be both more efficient and to better compete with our 
rivals in other parts of the world.
    This is also essential to our leadership in this hemisphere and the 
world. Having won the cold war, we face the more subtle challenge of 
consolidating the victory of democracy and opportunity and freedom. For 
decades, we have preached and preached and preached greater democracy, 
greater respect for human rights, and more open markets to Latin 
America. NAFTA finally offers them the opportunity to reap the benefits 
of this. Secretary Shalala represented me recently at the installation 
of the President of Paraguay. And she talked to Presidents from 
Colombia, from Chile, from Venezuela, from Uruguay, from Argentina, from 
Brazil. They all wanted to know, ``Tell me, is NAFTA going to pass so we 
can become part of this great new market--more, hundreds of millions 
more of American consumers for our products.''
    It's no secret that there is division within both the Democratic and 
Republican Parties on this issue. That often happens in a time of great 
change. I just want to say something about this because it's very 
important. Are you guys resting? I'm going to sit down when you talk, so 
I'm glad you got to do it. [Laughter] I am very grateful to the 
Presidents for coming here, because there is division in the Democratic 
Party and there is division in the Republican Party. That's because this 
fight is not a traditional fight between Democrats and Republicans and 
liberals and conservatives. It is right at the center of the effort that 
we're making in America to define what the future is going to be about.
    And so there are differences. But if you strip away the differences, 
it is clear that most of the people that oppose this pact are rooted in 
the fears and insecurities that are legitimately gripping the great 
American middle class. It is no use to deny that these fears and 
insecurities exist. It is no use denying that many of our people have 
lost in the battle for change. But it is a great mistake to think that 
NAFTA will make it worse. Every single solitary thing you hear people 
talk about, that they're worried about, can happen whether this trade 
agreement passes or not, and most of them will be made worse if it 
fails. And I can tell you it will be better if it passes.
    So I say this to you: Are we going to compete and win, or are we 
going to withdraw? Are we going to face the future with confidence that 
we can create tomorrow's jobs, or are we going to try against all the 
evidence of the last 20 years to hold on to yesterday's? Are we going to 
take the plain evidence of the good faith of Mexico in opening their own 
markets and buying more of our products and creating more of our jobs, 
or are we going to give in to the fears of the worst-case scenario? Are 
we going to pretend that we don't have the first trade agreement in 
history dealing seriously with labor standards, environmental standards, 
and cleverly and clearly taking account of unforeseen consequences, or 
are we going to say this is the best you can do and then some?
    In an imperfect world, we have something which will enable us to go 
forward together and to create a future that is worthy of our children 
and grandchildren, worthy of the legacy of America, and consistent with 
what we did at the end of World War II. We have to do that again. We 
have to create a new world economy. And if we don't do it, we cannot 
then point the finger at Europe and Japan or anybody else and say, ``Why 
don't you pass the GATT agreement; why don't you help to create a world 
economy?'' If we walk away from this, we have no right to say to other 
countries in the world, ``You're not fulfilling your world leadership; 
you're not being fair with us.'' This is our opportunity to provide an 
impetus to freedom and de- 

[[Page 1759]]

mocracy in Latin America and create new jobs for America as well. It's a 
good deal, and we ought to take it.
    Thank you.

[At this point, the President signed the NAFTA supplemental agreements.]

    I'd like to ask now each of the Presidents in their turn to come 
forward and make a statement, beginning with President Bush and going to 
President Carter and President Ford. And I will play musical chairs with 
their seats. [Laughter]

[At this point, President Bush, President Carter, and President Ford 
made remarks in support of NAFTA.]

    I wanted you to welcome Mrs. Carter. [Applause] Let me again express 
my profound thanks on behalf of all of us to President Bush, President 
Carter, and President Ford and close the meeting by invoking a phrase 
made famous last year by Vice President Gore: ``It's time for us to 
go.''
    Thank you very much.

Note: The President spoke at 10:39 a.m. in the East Room at the White 
House. In his remarks, he referred to William M. Daley, NAFTA Task Force 
Chairman, and Bill Frenzel, Special Adviser to the President for NAFTA. 
The President was introduced by the Vice President.

  On September 14, Press Secretary Dee Dee Meyers issued the following 
statement:

  Due to a staff error, the President incorrectly stated that NAFTA 
would create 1 million new jobs over 5 years.

  The NAFTA will create 200,000 new export-related jobs in the first 2 
years after it is passed. By 1995, 900,000 U.S. jobs will be dependent 
on exports to Mexico. NAFTA will help secure those jobs, and trade with 
Mexico will help create even more jobs in future years.