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How Capitalism and Technology Created (a) NAFTA

naftabrnssm.thumbnail.jpgIn the late-20th century and especially in this first decade of the 21st century, there have been impassioned and highly controversial debates about the merits and demerits of trade agreements like the World Trade Organization (WTO), North American Free Trade Agreement (NAFTA), Free Trade Agreement of the Americas (FTAA), and the Dominican Republic-Central American Free Trade Agreement (DR-CAFTA)–which was simply called CAFTA before January 2004 and renamed after. Recent discussions about globalization and the asymmetries of these agreements can be found here, here, and here. And yet, as I’ll show, these agreements simply formalized (or attempted to formalize) a sub-rosa globalization and a new international division of capital and labor that began to operate defacto since the mid-1970s. Capitalism and technology played a huge role in these developments, with both equally contributing to this enterprise.

Before the mid-1970s, there was a pact between capital and labor in general, and in particular, among labor, management, and the state: that is, with the cooperation of labor and management, the state regulated and arbitrated productivity, wages, and profits. The production of consumer products developed mass consumption–in other words, supply worked to create demand. Americans became consumers of their own products–pace Henry Ford: "Our workers shall also be our customers," a capitalist model commonly known as Fordism.

However, by the mid-1970s, the saturation of domestic markets for consumer products led to the expansion of capital into third-world countries for the production and increasing consumption of these products by a robust and cheap third-world urban labor force ready for work but disorganized. Capital then became extremely fluid, eroding to a certain extent the boundaries and functions of traditional nation-states: no restrictions on first-world investment and transfers of capital, as third-world governments lusted after first-world revenues, and as first-world global (transnational) corporations lusted after cheap and robust third-world labor. This was a truly symbiotic relationship indeed, which eventually led to two condominiums.

The first condominium comprised first-world imperial agents and a third-world local elite that needed the same (and phenomenally contradictory) obligations from third-world countries: a weak government in relation to capital (no restrictions on the fluidity of capital) and a strong government in relation to labor (to guarantee a needy domestic labor market by imposing taxes and overpricing punitive to the poor). Now, this new international division of labor and capital started working for the free global circulation of humans, products, and information. Which brings us to the second condominium, a logical corollary and in fact the result of the first one: that of capital and technology.

In the first world, in the mid-1970s and through the early 1980s, capital began to assign value to information and knowledge. Put in other words (so to speak), capital began to value information as a product. Now in capitalism, what is valued is what can be exchanged: a product has exchange-value. Once this new value process began to value information, as distinct from concrete products like soap and furniture, the time of information (which capital has now determined to have labor-power) began to free itself from the time of concrete labor. As a result, capitalism began to lose interest in organizing space into sectors for labor production, and began to focus instead on capturing all of time under its own laws of asymmetric exchange. (Needless to say, this new development dissolved the old pact between capital and labor.) In this new regime created by capital and technology, time and human bodies were liberated from the space of labor production, and home and work became indistinguishable (pace the rapid acceleration of telecommuting). The sequence worked thus: information as product allowed capital to free time from the space of concrete labor; then capital was free to lock up time all together and to conscript human beings into the service of capital and of time. (Time itself played the contradictory and peculiar roles of master and slave. We recall here that popular expression: "Time is money and money is time." ) (and its vulgar cousin expressions "I’m running short on time" "Do you have enough time to do this?" "You have too much time on your hands" and so and so on) And Eric Alliez has spoken of human beings as civil servants of time.

Capital and technology eventually produced a teletopia that erased the duration of time and the extension of space. This teletopia can also go by another name: globalization, which depends on absolute speed (pace Paul Virilio) to produce unequal exchanges between capital and labor, on the one hand, and unequal relationships and asymmetrical "formal" trade contracts between the first world and the third world, on the other hand. In the US, globalization can also be simply understood on one level as the flight of domestic jobs into the global labor market.

To repeat: WTO, NAFTA, FTAA, and DR-CAFTA simply formalized this new regime that had been in operation since the mid-1970s. The problem is that these trade agreements are among unequal and asymmetric countries. As an example: NAFTA established trade contracts among first-world countries (US, Canada), third-world countries (Mexico, all the Central American countries, and almost all South American countries except Chile–see below); and the only country in NAFTA that strands the first-world and the third world–Chile, which is neither completely first world nor completely third world–and which is a phenomenon that deserves its own analysis at some point…

(Image courtesy Hoodwinked: The Myth of Free Trade)

(Biodun Iginla)

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Biodun Iginla

Biodun Iginla

Biodun Iginla has published nine novels, including LOVE IN THIS TIME OF SILICON, A CYBER ROMANCE I-V, a series of five novels, THE SEX DIARY OF A PROFESSOR, and one nonfiction book, THE REGIMES OF CAPITAL AND TECHNOLOGY, and is also an online full-time senior news analyst for BBC out of London, UK, and a freelance writer, editor, and political blogger who divides his time between Minneapolis, London, and Paris. He writes mostly about (international) politics, capitalism, globalization, technology, and culture--and can be reached at He also freelances full-time for BBC News World Servce. Please visit his political blog at to see his cross-posts on the BBC News website: He is currently working on another novel, RAMBLINGS OF SOMEONE AT THE EDGE.