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How Nafta Made Mexicans Fat · Trumponomics

• 0:01
  Speaker 1: Thank you, Thank you very much. Then President Bill Clinton
• 0:07
  Speaker 1: stepped up to a podium to make an announcement. I
• 0:10
  Speaker 1: believe we have might a decision now that will permit
• 0:14
  Speaker 1: us to create an economic order in the world that
• 0:17
  Speaker 1: will promote more growth, more equality, better preservation of the environment,
• 0:22
  Speaker 1: and a greater possibility of world peace. That clip is
• 0:26
  Speaker 1: from the William J. Clinton Presidential Library, and in it,
• 0:30
  Speaker 1: the President signs into law the North American Free Trade Agreement,
• 0:35
  Speaker 1: or NAFTA. The goal of that law was to boost
• 0:37
  Speaker 1: the U s economy by opening up trade with Canada
• 0:40
  Speaker 1: and Mexico. Twenty four years later, trade has grown. For example,
• 0:45
  Speaker 1: Mexico now sends almost eleven billion dollars worth of fruit
• 0:48
  Speaker 1: and vegetables each year into the US, and farmers in
• 0:52
  Speaker 1: states like Iowa make their living by sending korn south.
• 0:55
  Speaker 1: But NAFTA also caused something else to expand, a different
• 0:59
  Speaker 1: kind of boom. Clinton didn't mention back in After more
• 1:03
  Speaker 1: than two decades of America exporting corn, cork, and dairy
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  Speaker 1: products to Mexico, what's also growing our Mexican waistlines. Welcome
• 1:21
  Speaker 1: to benchmark. I'm Scott Landman, economics editor of Bloomberg News
• 1:24
  Speaker 1: in Washington on Benchmark. We've discussed before how the Trump
• 1:28
  Speaker 1: administration thinks NAFTA is unfair to American workers, but we've
• 1:33
  Speaker 1: never really looked at how the trade agreement has changed
• 1:35
  Speaker 1: Mexico and its citizens. One big change America has made
• 1:39
  Speaker 1: Mexico more opies. A recent study by researchers in the
• 1:44
  Speaker 1: US and Europe, posted on the website fox Eu, found
• 1:47
  Speaker 1: a direct correlation between declining public health in Mexico and
• 1:52
  Speaker 1: the increase in soybean and pork products being shipped there.
• 1:55
  Speaker 1: Shelley Hagen, our economy team intern in DC, wrote an
• 1:59
  Speaker 1: article about this study, and she's here with us today. Shelly,
• 2:02
  Speaker 1: Welcome to Benchmark. Thanks for having me, Scott. So what
• 2:05
  Speaker 1: did this paper say, Shelly? A group of economists found
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  Speaker 1: that Mexico has been importing a large amount of unhealthy
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  Speaker 1: American food and beverage products, a number that has grown
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  Speaker 1: since NAFTA went into effect in the ninety nineties. At
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  Speaker 1: the same time, Mexico's imports of healthy American products like
• 2:22
  Speaker 1: fruits and veggies have not grown nearly as fast as
• 2:25
  Speaker 1: the unhealthy imports. Well, Mexico has been purchasing more and
• 2:29
  Speaker 1: more unhealthy goods from America. Mexico's obesity rates have also
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  Speaker 1: risen as much as fifteen in twenty years. In fact,
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  Speaker 1: Mexico now has more overweight and obese people as a
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  Speaker 1: share of the population than more than thirty major economies,
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  Speaker 1: including the US. All right, thanks Shelly. Now to discuss
• 2:48
  Speaker 1: this change in public health, we're joined by Simone Barkara.
• 2:52
  Speaker 1: He's the executive director of the Nutrition and Health Research
• 2:55
  Speaker 1: Center at Mexico's National Institute of Public Health, and he's
• 3:00
  Speaker 1: spent years studying obesity, diabetes, and cardiovascular disease. He joins
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  Speaker 1: us from Cuernavaca, Mexico, just outside Mexico City. Dr Barkarra,
• 3:10
  Speaker 1: Bien beneito, and welcome to Benchmark. Thank you very much. First,
• 3:14
  Speaker 1: just a bit of full disclosure. Dr Barkerra's research has
• 3:16
  Speaker 1: been partially funded through an unrestricted grant from Bloomberg Philanthropies,
• 3:21
  Speaker 1: which encompasses the charitable activities of Mike Bloomberg, the founder
• 3:24
  Speaker 1: and majority owner of Bloomberg LP, which is the parent
• 3:28
  Speaker 1: company of this podcast. So let's go back in time
• 3:32
  Speaker 1: thirty years ago to the nineteen eighties. Dr Barkerra, what
• 3:36
  Speaker 1: did Mexicans eat back then at that time, the consumption
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  Speaker 1: was mostly of basic foods that were prepared in houses,
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  Speaker 1: mostly beings, tortilla, and many vegetables that are combined in
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  Speaker 1: the dishes. Also fruits that are locally produced, and different
• 3:57
  Speaker 1: types of water infusions that we called our fascus, some
• 4:01
  Speaker 1: of them with some amount of sugar, but not as
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  Speaker 1: much as a soda. And that has changed a lot
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  Speaker 1: since then. And how would you describe the general health
• 4:12
  Speaker 1: of Mexicans thirty years ago. Well, in the eighties there
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  Speaker 1: was a very low prevalence of overweight and obesity, maybe
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  Speaker 1: only about less than thirty percent of the population had
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  Speaker 1: obviosity all overweight, and right now is seventy percent. So
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  Speaker 1: we basically are thinking of another country where where over
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  Speaker 1: city was very uncommon. And how did this change throughout
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  Speaker 1: the nineteen nineties and the two thousand's. Well, it was
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  Speaker 1: very interesting to see that in just an eleven year
• 4:46
  Speaker 1: periods from night to nineteen nine, the increase, for example,
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  Speaker 1: in so that consumption was of about four percent. At
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  Speaker 1: the same time at that moment, the consumption of fruits
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  Speaker 1: and vegetables decrease, and there was a very important change
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  Speaker 1: in the patterns of food consumption but also in the
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  Speaker 1: general food system in the country. How much of a
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  Speaker 1: problem is obesity in Mexico today? Today, I can say
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  Speaker 1: that is the most important public health problem. We have
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  Speaker 1: an alert and epiemiologic alert due to the side rates
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  Speaker 1: of diabetes and obesity that we are facing. Since maybe
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  Speaker 1: since two thousand and twelve, we have sevent of all
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  Speaker 1: adults with overweight and obesity and one out of every
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  Speaker 1: three children has overweight or obesity. So it's a very
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  Speaker 1: complex situation. In the case of diabetes, we are one
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  Speaker 1: of the countries in the world with the highest mortality
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  Speaker 1: and bordering of this condition, which is mostly related to
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  Speaker 1: the high rates of ovicity. And what would you say
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  Speaker 1: are the byproducts of this trend? I mean, how is
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  Speaker 1: that affecting, say, health services in the country, hospitals, doctors.
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  Speaker 1: How would you describe that well? Is very complicated. Is
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  Speaker 1: a challenge because obesity is associated with more than faulting
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  Speaker 1: causes of death, and so it goes from diabetes to
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  Speaker 1: the vascular disease and cancer. And these chronic conditions are
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  Speaker 1: very expensive because they cannot be solved with antibiotic with
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  Speaker 1: a single treatment. These conditions require life treatments and complications
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  Speaker 1: are very expensive and cause a lot of incapacity. So
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  Speaker 1: these these conditions affect productivity. So, for example, the diabetes
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  Speaker 1: is the main cause of blindness in the country, also
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  Speaker 1: also of amputations, and also of renal failure and dialysis,
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  Speaker 1: and this kind of treat meants are so expensive that
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  Speaker 1: there is no enough budget in the system to to
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  Speaker 1: be able to treat all the patients with this problem.
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  Speaker 1: So so definitely the only option is to try to
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  Speaker 1: walk very fat on preventing and controlling these conditions through
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  Speaker 1: reducing the rates of obesity. Why do you think Mexicans
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  Speaker 1: have become more obese than many other countries that are
• 7:27
  Speaker 1: more developed and have higher incomes. Well, I think it's
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  Speaker 1: a combination of factors, but one of the most important
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  Speaker 1: is a very rapid transition to a model of industrialized food,
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  Speaker 1: which is a phenomenon called accorporation, and without controlling the
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  Speaker 1: new environment. So the population transition very quickly from drinking
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  Speaker 1: aguas frisk ass and and traditional food basic food prepar
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  Speaker 1: at home to ultra processful that is bought in a
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  Speaker 1: supermarket that has a lot of ingredients that our own
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  Speaker 1: healthy such as sugar, salt, and fat, and without knowing
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  Speaker 1: really the relation of diet to these chronic conditions which
• 8:19
  Speaker 1: were not really prevalent in the country. So you can
• 8:24
  Speaker 1: still now see many populations in impoor areas of the country,
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  Speaker 1: such as the South, where people have diabetes for the
• 8:31
  Speaker 1: first time in their families. So first generation and is
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  Speaker 1: very complicated. They don't understand why they felt thirsty, and
• 8:40
  Speaker 1: they sometimes they don't know that that they have to
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  Speaker 1: stop drinking soda. There are many communities where soda has
• 8:47
  Speaker 1: become part of local ritual traditions. So it is becoming
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  Speaker 1: very complicated to try to implement measures or policies to
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  Speaker 1: decrease this unhalth new habits in the population. And would
• 9:03
  Speaker 1: you say that obesity is more of an issue in
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  Speaker 1: cities or in rural areas or both. Well, obviosity is
• 9:09
  Speaker 1: more prevalent in the cities right now in Mexico, But
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  Speaker 1: when you mentioned the speed of increase, rural areas are
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  Speaker 1: now having a higher speed of increasing the prevalence of obesity.
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  Speaker 1: That means that rural areas are very quickly catching up
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  Speaker 1: with the high prevalence of obbicity that we are watching
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  Speaker 1: in the cities. Simon, over the last twenty years or
• 9:35
  Speaker 1: So did it ever cross your mind that it was
• 9:38
  Speaker 1: NAFTA that was helped playing a role in delivering these
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  Speaker 1: kinds of foods that were boosting obesity in Mexico. Yes, yes,
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  Speaker 1: because we saw very interesting effect effects in food prices
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  Speaker 1: after NaSTA. For example, Mexico is a big publisher of sugar,
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  Speaker 1: but with NAFTA we started to have also high cone
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  Speaker 1: fructose competing in the market. That and and the high
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  Speaker 1: fructose is subsidized empowered by the United States, so it's
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  Speaker 1: really low priced. So to try to maintain the production
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  Speaker 1: and the workers of sugar, the government in Mexico also
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  Speaker 1: started some sort of support and subsidies to sugar. So
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  Speaker 1: the net balance of nat time in this example was
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  Speaker 1: that in a very short period of time we had
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  Speaker 1: very inexpensive sugar, and that was an incentive for producers
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  Speaker 1: of many kinds of ultra process foods of adding sugar,
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  Speaker 1: which everybody likes, and it's an inexpensive way to make
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  Speaker 1: to add something to a food. So this was one
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  Speaker 1: of the very important changes. The other change that was
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  Speaker 1: impressive was the amount of supermarkets in Mexico just after NATA.
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  Speaker 1: I could say that most of the football chases now
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  Speaker 1: are done in supermarkets sometimes are the big change with
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  Speaker 1: the same names as in the US. And there used
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  Speaker 1: to be shopping in most people. Would you used to
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  Speaker 1: shop at, say, smaller markets. Is that is that fair? Yes? Yes,
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  Speaker 1: they used to shop in small markets of locally produced
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  Speaker 1: foods for example, that there was always as the bakeries
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  Speaker 1: in Europe, we have the tortillas the cornery shop in
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  Speaker 1: which there was a tortilla small little factor in in
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  Speaker 1: in every town. And now the tortillas are in solved
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  Speaker 1: in the supermarket also and it's the same the same
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  Speaker 1: kind of preparation of flower for for all of them,
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  Speaker 1: and it's an industrialized process. So is the food system
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  Speaker 1: has changed a lot in only twenty two third years now.
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  Speaker 1: There have also been some efforts to attack this problem,
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  Speaker 1: to restrict the consumption of the kinds of foods that
• 12:00
  Speaker 1: are making people a beast. There's a soda tax and
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  Speaker 1: and also I believe a junk food tax. Are these
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  Speaker 1: taxes working? Have they had any effect on obesity? Yes?
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  Speaker 1: We we definitely have evidence that these taxes are working.
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  Speaker 1: And when we first watch consumption of soada in the
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  Speaker 1: end of the nineties, there was a very big amount
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  Speaker 1: of calories coming every day from sugary beverage in all
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  Speaker 1: age groups. So so it was it was a problem,
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  Speaker 1: and we started recommending a solar tax seems two and three.
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  Speaker 1: So after more than dangers, finally the government had a
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  Speaker 1: window of opportunity to implement the tax, and we sad
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  Speaker 1: don't different efforts to evaluate the effects in these two
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  Speaker 1: years which is the period that we have the tax.
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  Speaker 1: It's a small tax, it's only one the super leader,
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  Speaker 1: so equivalent to about ten and even though if smaller
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  Speaker 1: than that what most international agencies recommend, it has been
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  Speaker 1: able to show reductions in consumption that are of about
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  Speaker 1: seven to twelve depending on the on the groups. And
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  Speaker 1: that's a lot that in a country that has one
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  Speaker 1: and twenty six million inhabitants, having these kind of reductions
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  Speaker 1: to cap it them represent many tons of sugar that
• 13:33
  Speaker 1: are not consumed thanks to this policy. Besides taxes, what
• 13:38
  Speaker 1: other policies could help. Well, we are trying very intensively
• 13:43
  Speaker 1: to promote some warning levels on food products that are unhealthy,
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  Speaker 1: particularly so that and ultra process foods that are hiring salt,
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  Speaker 1: sugar or fat. We have seen that countries like Chili
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  Speaker 1: that implemented. These kind of warning levels in the foods
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  Speaker 1: allow the consumers to very quickly identify on healthy foods
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  Speaker 1: and look for healthier decisions. So I think this is
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  Speaker 1: one policy that in which we need to work very hard.
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  Speaker 1: We are trying to to convince the decision makers that
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  Speaker 1: this is a very powerful tool in a population that
• 14:25
  Speaker 1: doesn't know how to interpret these complex labelings with numbers
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  Speaker 1: and percentages. That it's almost like a cigarette warning labels
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  Speaker 1: for chunk food right exactly, you're saying this product is
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  Speaker 1: high or has an excess of sugar, and then the
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  Speaker 1: consumer can compare this one with one that doesn't have
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  Speaker 1: this level, and and that that is very helpful in
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  Speaker 1: the context. And the other policy that cool health a
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  Speaker 1: lot is controls on marketing. So again in the same
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  Speaker 1: way as in tobacco, market think is a very powerful
• 15:02
  Speaker 1: tool of corporations to increase consumption. And sometimes this marketing
• 15:06
  Speaker 1: in foods is directed to children. So we need to
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  Speaker 1: develop better policies and regulations to protect children from having
• 15:17
  Speaker 1: on healthy foods. We are for example, evaluating point of
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  Speaker 1: purchase and in the supermarkets it is completely directed to
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  Speaker 1: attract children's and most of the foods that are sold
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  Speaker 1: have have excess of sugar and other ingredients that are unhealthy.
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  Speaker 1: So this is something that which we also need to
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  Speaker 1: work a lot, and in schools and other sites in
• 15:41
  Speaker 1: which children are very frequently, such as public parks, try
• 15:45
  Speaker 1: to increase availability of water and to decrease marketing and
• 15:49
  Speaker 1: also sale off on healthy products. Dr bark Hera, we
• 15:54
  Speaker 1: can't let you go without talking about the big issue,
• 15:56
  Speaker 1: loving all over this and trace Manuel Lopez over Doors
• 16:00
  Speaker 1: the leading candidate in Mexico's upcoming presidential election, and he
• 16:04
  Speaker 1: likes to talk about how NAFTA has driven Mexican farmers
• 16:08
  Speaker 1: out of business, just as a side not check out
• 16:10
  Speaker 1: our new poll tracker on Bloomberg dot com for the
• 16:12
  Speaker 1: Mexican presidential election. Dr Barca, is there any link between
• 16:17
  Speaker 1: the loss of local agriculture in Mexico and the rise
• 16:20
  Speaker 1: in obesity? My sense is that in general, many of
• 16:26
  Speaker 1: the macro egonomic indicators of Mexico have been improving. Even
• 16:31
  Speaker 1: talking about health and development, we have been a nation
• 16:35
  Speaker 1: that is showing a little bit about average improvement compared
• 16:40
  Speaker 1: to other Latin American countries. So it is complex to
• 16:44
  Speaker 1: evaluate something such as the food system that has many effects.
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  Speaker 1: Many experts, for examples from the World Health Organization are
• 16:54
  Speaker 1: trying to understand the net benefits of trade, which some
• 17:00
  Speaker 1: times are for example, food availability and reduction of on
• 17:03
  Speaker 1: their nutrition, and then compare the trade offs such as
• 17:07
  Speaker 1: increasing no communical point diseases. This is a challenge and
• 17:12
  Speaker 1: we don't have very clear understanding of it, but in
• 17:16
  Speaker 1: general I think the main challenge is a challenge that
• 17:20
  Speaker 1: can be solved mostly by regulating and helping the food
• 17:25
  Speaker 1: environment more than avoiding phrase just as a solution. All right,
• 17:31
  Speaker 1: a very diplomatic answer, Dr Barkerra, thank you so much
• 17:34
  Speaker 1: for joining us today on Benchmark. Thank you very much.
• 17:38
  Speaker 1: Scott Benchmark will be back next week. Until then, you
• 17:44
  Speaker 1: can find us on the Bloomberg terminal, Bloomberg dot com,
• 17:47
  Speaker 1: our Bloomberg app, and podcast destinations such as Apple, podcast,
• 17:51
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• 17:54
  Speaker 1: the show, and you can also find us on Twitter.
• 17:57
  Speaker 1: You can follow me at Scott Landman Show le You're
• 18:00
  Speaker 1: at at Shelley k Hagen s h E l l
• 18:04
  Speaker 1: y k h A g A. N our guest is
• 18:07
  Speaker 1: at at s b A r q U E r
• 18:10
  Speaker 1: A and as a side note, check out our new
• 18:13
  Speaker 1: pull tracker on bloomberg dot com for the Mexican presidential election.
• 18:17
  Speaker 1: Benchmark is produced by tofor foreheas the head of Bloomberg
• 18:20
  Speaker 1: Podcast is Francesco Levy. Thanks for listening, See you next time.