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The opening graphic of the Larry King Debate.

By Charles Apple

That's the way bazillionaire and on-again, off-again presidential candidate Ross Perot — 30 years ago Friday — described what would happen if the North American Free Trade Agreement, or NAFTA, was approved: Jobs would move to Mexico so quickly it would make “a giant sucking sound.”

NAFTA was passed. And manufacturing jobs did indeed move out of the U.S. But was that the result of NAFTA or were other forces responsible for that? It depends on whom you ask ...

What Was Nafta?

The North American Free Trade Agreement aimed to promote trade between the U.S., Canada and Mexico. It eliminated or phased out most tariffs between the three countries — particularly on textiles, automobiles and agricultural products — creating a free-trade zone.

Side agreements were included to establish higher standards for workplace safety, labor rights and environmental protection and to discourage businesses from relocating to other countries in order to take advantage of lower wages or looser regulations.

Ronald Reagan had made the idea of a North American free trade zone part of the announcement of his candidacy for president in 1979. In 1992, Bill Clinton was elected president with the support of organized labor. The next year, he joined his predecessors, Reagan and George H.W. Bush, in pressuring Congress for approval of NAFTA.

Labor unions, on the other hand, opposed NAFTA, fearing — as Ross Perot would popularize — a flood of American factory jobs moving to Mexico. Protests were organized in Detroit and Washington.

Clinton responded: “If we don't pass NAFTA, that could still be true. The lower wages and the lower cost of production will still be there. But if we do pass it, it means dramatically increased sales of products made right here in America.”

NAFTA passed both the House and Senate and was signed into law by Clinton on Dec. 8, 1993. It went into effect on Jan. 1, 1994.

The Debate On 'Larry King Live'

The debate pictured live on Larry King.
CNN's Larry King Live

Without a doubt, the key moment in the battle over NAFTA came on Nov. 10, 1993, when CNN's Larry King hosted a debate with Ross Perot and Vice President Al Gore.

Gore made a case for raising the standard of living for factory workers in Mexico. Such a move might “cut down on illegal immigration,” he said.

“We do the world's dumbest trade agreements,” Perot said. “You go back to the agreements we've done all over the world (and) you'd be amazed that adults did them.” Perot called for using tariffs, rather than an inclusive free trade agreement.

“If the U.S. is going to do business with another country, let's do business with a country whose people can buy things,” he argued.

“If we keep shifting our manufacturing jobs across the border and around the world and deindustrializing our country, we will not be able to defend this great country,” Perot said. “And that is a risk we will never take.”

Most observers thought Gore trounced Perot, although it's Perot's quip that everyone remembers, 30 years later, even though it wasn't the first time he had used that line.

“We have got to stop sending jobs overseas,” Perot had said in a 1992 Presidential debate. “It's pretty simple: If you're paying $12, $13, $14 an hour for factory workers and you move your factory south of the border, pay a dollar an hour for labor, have no health care — that's the single most expensive single element in making a car — have no environmental controls, no pollution controls and no retirement, and you don't care about anything but making money, there will be a giant sucking sound going south.”


NAFTA resulted in a number of positive outcomes, according to a 2017 report issued by the Congressional Research Service.

  • Trade between Canada, Mexico and the U.S. more than tripled after NAFTA took effect.
  • This greater trade increased economic output at about 0.5% a year, according to the U.S. International Trade Commission.
  • The growth created by NAFTA created jobs. Free trade agreements by the U.S. directly supported 5.4 million jobs and trade with those countries supported 17.7 million jobs.
  • The North American partners more than tripled their investment in one another: The U.S. increased foreign direct investment, or FDI, in Mexico from $15.2 billion in 1993 to $104.4 billion in 2012 and from $69.9 billion in 1993 to $352.9 billion in 2015 in Canada.
  • NAFTA lowered certain prices. Oil imports from Mexico became cheaper, which allowed the U.S. and Canada to import more oil from Mexico and to reduce their reliance on oil from the Middle East.
  • In the five years after NAFTA came into force, manufacturing employment increased by 800,000. Much of this growth was created by a surge in exports to Mexico.
  • Since then, however, manufacturing jobs in the U.S. have fallen. A 2013 report by the Congressional Research Service found the job losses were not the fault of NAFTA, nor did the large economic gains that were expected from the agreement materialize.
  • While critics blame this on NAFTA, supporters point out there have been other factors in play: A “trade shock” caused after China entered the World Trade Organization in 2001 and the Great Recession of 2008-09.
Chart of employment over NAFTA's history.


  • A 2015 report from the Economic Policy Institute estimated a loss of 850,000 jobs in the U.S. from 1993 to 2013. California, New York, Michigan and Texas were the states hit hardest. Estimated job gains were even greater, but not in the same industries that lost jobs.
  • That same report reported productivity in U.S. and Mexican manufacturing increased but that real wages dropped by 17% in Mexico from 1994 to 2011 and fell in the U.S. as well. Autoworker wages in the U.S., for example, dropped 26% from 2002 to 2013.
  • Dean Baker of the Center for Economic and Policy Research cited another example of negative impact: NAFTA allowed more medical students from Mexico to train in the U.S. This brought down salaries for doctors and, therefore, medical costs — a good thing if you're visiting a doctor. Not so good, perhaps, if you're the doctor.
  • Timothy Wise of Tufts University acknowledged that “foreign investment quadrupled. Trade, overall, tripled ... What it didn't produce is jobs and development” among Mexican-owned companies, he said. In fact, he felt NAFTA may have stunted Mexico's development.
  • n NAFTA lowered prices of U.S. agricultural goods in Mexico, which put 1.3 million Mexican farmers out of business. Not coincidentally, Mexican immigration to the U.S. increased by 79% from 1994 to 2000.
Sources: The New York Times, Business Insider, CNN, NPR, Huffington Post,, the White House, U.S. Department of Agriculture, U.S. Customs and Border Protection, Council on Foreign Relations,, Gallup, the Conversation

This edition of Further Review was adapted for the web by Zak Curley.