Economists have had enormous influence on trade policy and provide a strong justification for free trade and the removal of barriers to trade. Although the objective of a trade agreement is trade liberalization, the actual provisions are strongly marked by national and international political realities. The world has changed enormously since David Ricardo proposed the law of comparative advantage, and in recent decades economists have changed their theories to take into account the trade of factors of production such as capital and labor, the growth of supply chains that today dominate much of world trade, and the success of neo-Mediterranean countries in achieving rapid growth. At that time, the leaders of the American textile industry, generally opposed to free trade, defended NAFTA. With the exception of the leaders of a few companies, the textile industry saw free trade with Mexico as the opening of a large market for its business. The textile mill products sector in Mexico was not well developed. As a result, Mexico represented a potential 25% increase in the market for U.S. textile producers. In order to address concerns about possible job losses in the United States, board members of the American Textile Manufacturers Institute (ATMI) promised that they would not relocate their jobs, factories or facilities to Mexico. Textile leaders` strong support for NAFTA prompted some members of Congress from major textile-producing countries to vote in favor of the agreement. In an attempt to retain the remaining domestic market share, U.S. apparel manufacturers have expanded their production division operations in Mexico and the Caribbean, taking advantage of lower wages and tariff preferences. And as part of a U.S.

free trade agreement, more U.S.-controlled clothing production will relocate East Asia to Latin America. == The following applies to textile factories, it is likely that Latin American garment producers will supply their products in the United States and abroad. Over time, this flow of products will likely supplant Asian apparel exports to the United States. This activity directly benefits the American textile industry. Many other U.S. industries will also benefit…