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How about taxing the western union and other ways that they send money back to relatives?

Nope, we have treaties and international agreements to REDUCE the cost of sending money out of the country. Especially with Mexico and South America. You have to get rid of the politicians and bureaucrats who set this up, then repeal the agreements if you want to change this.

But you'll get a huge and well funded fight from Citibank, Wells Fargo and Bank of America. They plan to make multi-billions of dollars on this, and have spent a lot of money buying off congress. They have NO allegiance as transnational corporations to this country and DONT CARE if we lose it.

Financial Access for Immigrants: The Case of Remittances

More important for remittances, in February 2004 the Reserve Banks expanded their international ACH services to Mexico, in cooperation with the Central Bank of Mexico. The service potentially connects any bank account holder in the United States with any bank account holder in Mexico, uses an exchange rate guaranteed to be within 1 percent of the Central Bank of Mexico's wholesale rate, and costs the banks less than $1 per transaction. Providing service to Mexico is also an important step for the U.S.-Mexican Partnership for Prosperity, an agreement designed to improve financial linkages between the two countries. These Federal Reserve initiatives will support U.S. banks' ability to serve immigrants by allowing remittances to be sent to foreign banks at low cost. Ongoing improvements in the infrastructure for sending remittances, collaborations among foreign governments, and increased competition among service providers should ensure that cost savings are passed on to consumers.

Remarks by Governor Ben S. Bernanke
At the Financial Access for Immigrants: Learning from Diverse Perspectives conference, Federal Reserve Bank of Chicago, Chicago, Illinois
April 16, 2004

http://www.federalreserve.gov/boarddocs/speeches/2004/200404162/