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Exciteable Young Men

Why Countries Sign Trade Deals "Against Their Interest"

"If NAFTA-like trade deals are so bad for developing nations, why are they lining up to get on board?"

Hand out enough fair-trade leaflets on campus, and you'll get asked this question soon enough by some smart ass from the Libertarian Debating and Choral Arts Society, or whatever the equivalent is at your school.

The Wall Street Journal provides clues that should inform your answer:

Manuel Medina-Mora has long had ambitions of running Citigroup Inc. He is getting closer.

After more than a decade as chief executive at Grupo Financiero Banamex, the Mexican banking company that is one Citigroup's choicest businesses, the 59-year-old Mr. Medina-Mora resigned last week to devote more attention to a daunting new job. The Mexican banker has to somehow turn around Citigroup's struggling consumer-banking operations world-wide...

Mr. Medina-Mora's growing power reflects his leadership of operations that stayed out of the headlines as much of Citigroup suffered through the financial crisis. Banamex and other Citigroup operations in Latin America overseen by Mr. Medina-Mora had $12.1 billion in net revenue last year, or about 20% of the total for Citigroup's core businesses.

Michael Mayo, a managing director and banking analyst at Calyon Securities, says Mr. Medina-Mora "has led one area of Citigroup that hasn't had significant issues." Banamex is a favorite of Mr. Pandit, who has praised its "universal bank" model of cooperation between different parts of the bank as Citigroup's future.

"We're going to export it around the world," Mr. Pandit said in 2008. The CEO has dispatched executives to Mexico to learn more about Mr. Medina-Mora's successful formula.

(Exporting the "universal banking" model around the world? Where have we heard that before?)

Turning to a helpful magazine profile of "the most influential and important people in Nafta commerce and finance" in the magazine Global Finance, we learn that:

Manuel Medina-Mora has been chairman and CEO of Citi Latin America and Mexico since 2004. Citi was a key promoter of Nafta and provides corporate finance for Mexican and foreign companies through its Banamex Mexican subsidiary. He started his career with Banamex in 1971 and in 1990 led Banamex’s privatization. In 1991 he became the deputy president responsible for Grupo Financiero Banamex-Accival’s strategy and corporate development and was appointed its CEO in 1996 and CEO of Banamex from 2001 to 2006.

In other words, local corporate honchos look North, see a way to climb up the corporate ladder by privatizing a national asset, advocating for a flawed trade deal, and letting a bigger corporation get in on a piece of the pie. And by the way, said flawed trade deal gives the big foreign corporation outrageous rights to make sure that the pie keeps coming.

By the time millions of your countrymen are left out of work and your country has been taken over by drug-traffickers, you've got a golden elevator up to a new global throne.

Folks, Mexico didn't sign up for anything. People like Medina-Mora signed Mexico up for NAFTA. Now, the rest of Mexico is left trying to pick up the pieces.

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