7 Ways the World Has Changed Since NAFTA
Growing up in Asia in the 1980s, the daughter of a U.S. foreign service officer, everyone I met wanted a U.S. visa. I could relate. The U.S. meant opportunity, creativity, and freedom. As a result, we coveted American products. You could literally taste the American Dream in a McDonald’s Big Mac. And while I loved China and Taiwan, where my mother is from, I couldn’t wait to get my hands on American goods (Madonna cassettes, neon jelly bracelets, paint splatter leggings — it was the 80’s after all).
In 2003, my sister and I started Hello!Lucky, a business that makes high-quality, hand-crafted letterpress greeting cards. In the last 12 years, we’ve done more than $10M in cumulative sales, opened an office in London, and begun exporting. With Egg Press, our business partner, we employ 26 people and are growing 60% year-over-year.
“NAFTA on steroids.” That’s been the rallying cry of critics of Trade Promotion Authority (TPA) and trade agreements like Trans-Pacific Partnership (TPP). TPA would give the president the ability to present Congress with a trade agreement for a straight up-or-down vote, which gives the U.S. more leverage at the negotiating table. TPP would cut or eliminate tariffs and quotas and set high labor and environmental and labor standards across the twelve countries around the Pacific. Critics claim that TPP, which would only be made possible by TPA, will destroy U.S. jobs by opening high-wage U.S. workers to low-wage foreign competition. They say NAFTA, which removed similar barriers in North America, look like “child’s play.”
Free trade is getting flamed. And why? Because of a trade agreement that happened in 1994, when a smart phone looked like brick.
The world has changed. First and foremost, it’s gotten a lot better for women, small business owners, and local manufacturers. Here are 7 of the ways:
- Mobile technology: In 1994, only the rich had cell phones, and no one had smart phones — least of all in emerging markets. Today, businesses can sell to billions of people globally directly on their phones.
- Entrepreneurship: Back then, if you wanted to start small businesses or be self-employed you had to bust ass and beg for a bank loan. Today, anyone can launch an e-commerce business thanks to marketplaces like Etsy, 99designs, and Upwork. If they need funding, they can raise money from Funding Circle, Kickstarter and Indiegogo (The Economist reports that global crowdfunding raised $16.2 billion last year).
- Women: In 1994, women were just tapping on the glass ceiling. Today, women like Janet Yolen to Angela Merkel are among the world’s top leaders, as Hannah Rosin points out in Men Dither While Women Lead the World. Forget about breaking the ceiling. Women are going around it by starting their own businesses, voicing their opinions on platforms like Medium, and supporting each other on sites like Glassbreakers.co. Plus, women can now simplify the “second shift” of household management with apps like Blue Apron, UrbanSitter, and Task Rabbit.
- Innovation. Global leaders agree that the future of the world economy lies in creativity and innovation, not in the unskilled labor and manufacturing that used to employ America’s middle class. Those jobs are gone, but not because of trade agreements. They’re gone because of the technological progress that’s brought us life-changers like the iPhone, Google, Facebook, and Uber. Americans’ quality of life and access to time to pursue their true callings has skyrocketed since 1994. We lead the world in innovation, and need to seize the day to retain that lead.
- Quality Manufacturing. The internet-created need for “fast” and “global” is driving a counter-balancing demand for “slow” and “local,” from the “slow food” movement to the rise of hand-crafted, locally-made products as evidenced by the successful IPO of global craft marketplace Etsy. As a small business owner selling high-end, high-quality, U.S.-made products (our sales have grown 60% year-over-year two years running), I have no worries about the threat of low-cost manufacturing overseas because that’s not what I’m selling. And that’s not what the U.S. should be selling, either.
- The Rise of the Asian Consumer. In 1994, Asia and other developing countries were mainly seen as a source of cheap labor and low-cost manufacturing. Today, Chinese labor costs are going up and rising 15% per year according to a CNBC report. Tack on growing quality-control issues, high transportation costs, and cheaper domestic energy costs, and the case for bringing manufacturing back home is starting to add up. At the same time, the Asian middle class is rising, currently numbering 300 million (a market size equal to the entire U.S. population) and expected to reach 3 billion by 2030. Like consumers in developed nations today, they will increasingly want high-end, well-made goods — exactly the type of goods Americans are positioned to design and manufacture. With its focus on Asia, TPP will ensure that U.S. manufacturers have access to the world’s biggest market.
- From The Good Life to A Good Life. Forget about becoming the next Donald Trump. Millennials want to balance work, family, and giving back. According to a Deloitte study reported in Why Millennials Want to Start Their Own Businesses, 70% of millennials want to the start their own businesses. It’s not just because the job market has been tough, though that is a reason. The other key reasons are the desire to make a positive social impact (85 percent want to work for a socially responsible or ethical company), and to balance work and life.
I am a small business owner. I’m a woman. I produce high-value-added, domestically manufactured products. The internet has allowed me to start a business, manufacture in the U.S., and to export. I have a career and a family, and I balance those with volunteerism and being an engaged citizen. The internet and global trade is making that life more possible than ever for Americans today and in future generations.
All the criticisms of TPP are as if the world was as it was 20 years ago. Even though many of the criticisms of NAFTA are true, the world is different now. Technology and innovation are giving women, self-employed, and small business-owners the opportunity to compete directly in the economy on a massive scale. Anything that we can do to lower barriers to export is fantastic, and takes away from large corporations who have lobbied for trade deals in the past. It’s a different world. The U.S. is the dominant force in technology and innovation today. We need to step up and lead the way.
Sabrina Moyle is co-founder and CEO of Hello!Lucky, a San Francisco-based greeting card company that manufactures in the U.S and sells to more than 1,000 stores worldwide. She is a small business owner and mother of three young boys. She grew up in China, Taiwan, Malaysia, and Libya, and is half-American and half-Chinese. She is also Founder of Share Trade, a campaign to promote conscious consumption, local manufacturing, and global trade.