Mexican Emigration vs. Economic Development

CaliforniaRepublic.org ^ | 6/5/07 | Allan Wall

[NormsRevenge]

Each year Mexicans in the United States send billions of dollars in remittances back to Mexico. In 2006, Mexicans working north of the border sent back US$23 billion. Remittances have become (after petroleum) the second highest legal source of income for Mexico. And that’s one of several reasons why Mexican leaders don’t want emigration to end.

But are these billions of dollars really helping Mexico?

You might think so, but if you look at the Mexican regions that receive high levels of remittances, they’re not exactly booming economically.

Take for example Michoacan, President Felipe Calderon’s home state. That state is the highest recipient of remittances, with 11.2 percent of its families receiving them. Nevertheless, Michoacan is still one of the more economically undeveloped states in Mexico. Other high-remittance receiving states have also failed to develop.

The United Nations Population Fund (UNFPA) did a study of the phenomenon, and according to spokesman Alfonso Sandoval the study determined that remittances in Mexico are not developing the country economically.

Most of the remittance money is spent on groceries or daily expenses, buying fancy vehicles, or remodeling houses. But little of it is being invested in permanent job-generating enterprises. Therefore the regions aren’t advancing economically.

Remittances also encourage some Mexicans not to work, since they can earn more from remittances than working on a Mexican job.

Mexico’s central bank, the Banco de México, has examined this issue. A 2005 study by the bank showed negative correlation between remittances and development. In other words, the more remittances the less development!

It suggested that this dependence on remittances was itself a cause of poverty, since it gave recipients fewer incentives to seek other sources of income.

Remittances even encourage more emigration. Remittance receivers in Mexico are more likely to want to emigrate than those who don’t!

So what’s really being accomplished here?

Not only is emigration of dubious economic value, its social costs are great. It exacerbates family disintegration and sometimes encourages deadbeat dads to abandon their families. Mexican congressman Jose Edmundo Ramirez admitted the problem in Washington, in February: “In addition, [Ramirez] said that ‘one Mexican per minute is leaving his family’ to go to the United States, which disintegrates families and leads to other problems such as alcoholism and drug addiction.”

Psychologically the pull of emigration is strong, and according to polls nearly half the population would emigrate if possible!

Emigration has become a national obsession. It’s really a shortcut to avoid dealing with the real problems in Mexico. It weakens the Mexican family and local communities. It impedes economic development, because the emigration mentality has permeated the whole society. “Why make things better in Mexico when people can just emigrate?” is the mentality. Emigration is like an addictive drug, and the addict needs ever-larger doses for his fix.

Generally speaking, Mexican emigrants are not the poorest of the poor. They’re usually from the upper tier of the poor, with a growing proportion of middle class Mexicans. In the Mexican schools in which I’ve worked, I’ve had co-workers who already had jobs but emigrated for more money.

Visiting Dallas last year, Banco de México chief Guillermo Ortiz said that tougher enforcement on the U.S. side “would be better over the long run” for Mexico.

Mexican vested interests, however, can be expected to oppose meaningful reform. The world’s second-richest man, Mexican Carlos Slim, and Mexico’s other billionaires are happy with the status quo.

Mexico’s own Constitution makes some reforms difficult, so it would need to be amended. And real reforms would be quite controversial.

That doesn’t sound like much fun for Mexican politicians, so they continue in the status quo, hoping Mexicans will continue to emigrate.

Additionally, in a country with a 40 percent (or more) tax evasion rate, the oil monopoly PEMEX is used as the government’s de facto tax collection agency at the gas pump. In 2006, 93.2 percent of its profits were used for government programs, which means not enough is left for oil exploration and processing. Meanwhile, Mexico’s biggest source of oil, the Cantarell field, is in decline, PEMEX is in debt, and restrictive foreign investment laws prevent exploitation of that hard-to-get-to deep oil in the Gulf of Mexico. So PEMEX is in trouble, but reforming it would be contentious.

Therefore, Mexico’s leaders remain committed to keeping Mexicans moving north, which takes pressure off them to reform the economy. What a shame for Mexico and her people.

[NormsRevenge]

Allan Wall recently returned from a tour of duty in Iraq. He currently resides in Mexico, where he has lived since 1991.

[Kozak]

TURN THE ENEMIES WEAPON AGAINST HIM

Call the “Senate Immigration Reform Hotline” at 1 800 417 7666
Press 1 for your senior senator, 2 for your junior senator.

This will connect you DIRECTLY to your senator without going through the congressional switchboard.

JAM THE LINES. LET THEM HEAR OUR ANGER AND FURY.

[sheana]

Mexicans working north of the border sent back US$23 billion.

I don’t give a rat’s behind whether this money is helping Mexico or not. It is $23 billion stolen from the American taxpayer.

[pnh102]

It is $23 billion stolen from the American taxpayer.

Perhaps if a 200% tax was put on the money sent to Mexico, it would help.

[utherdoul]

While I don’t like illegal immigration or american currency being sent to a hostile nation I’ve seen those guys out there and they earn every cent of it.

[sheana]

I earn every cent of mine too.....legally. And I would rather keep it than pay for illegals healthcare, food stamps, housing, etc. so they can send all their money back to Mexico or wherever they are from.

[utherdoul]

I don’t disagree with you, but I do disagree with the idea that the money is stolen. Without them to do the heavy dirty labor nobody else would do, who would dish out french fries or bag groceries, or tile my roof?

[penowa]

"...and according to polls nearly half the population would emigrate if possible!"

Get ready for this - and that's ONLY Mexico.

[untenured]

Under some very simple yet plausible assumptions, the existence of the U.S. labor market makes Mexican economic reform impossible, which makes illegal immigration irresistible.

[AuntB]

utherdoul says: “ Without them to do the heavy dirty labor nobody else would do, who would dish out french fries or bag groceries, or tile my roof?”

Without them...we would not need to rebuild the infrastructure of what equals the population of 17 states! All those jobs get done in my area without illegal alliens. They barely produce enough to supply themselves!

---

http://www.freerepublic.com/focus/f-chat/1840655/posts

Do you realize if this AMNESTY happens we are in effect creating the equivilent of adding over 17 more states to this country? And that’s not even considering the chain migration that is in the Senate bill.

Please look at what giving amnesty to as many as 20,000,000 illegal alien foreign nationals actually represents. More than the population of 16 states and DC!

According to the 2000 census, 18,785,867 is the total populations combined of Wyoming, Dist. of Columbia, Vermont, Alaska, North Dakota, South Dakota, Delaware, Montana, Rhode Island, Hawaii, New Hampshire, Maine, Idaho, Nebraska, West Virginia, New Mexico and Nevada.

THINK about that.

http://www.enchantedlearning.com/usa/states/population.shtml

http://www.freerepublic.com/focus/f-chat/1840655/posts
Conversation with a Senator -What does AMNESTY look like?

[Tennessee Nana]

“Without them to do the heavy dirty labor nobody else would do, who would dish out french fries or bag groceries, or tile my roof?”

My American citizen tax-payer kids “dish(ed) out french fries or bag(ged) groceries” to work their own way through college, and the illegal aliens who tiled your roof were very well paid...

BTW are you suggesting a slave race?

[Ajnin]

Without them to do the heavy dirty labor nobody else would

This is a myth.

[sheana]

An American? Novel concept, I know.

[snowrip]

They sure as hell don’t earn the $90,000,000,000.00 it costs us annually in state and federal aid.

[snowrip]

Without them to do the heavy dirty labor nobody else would do, who would dish out french fries or bag groceries, or tile my roof?

The same people that did it ten, twenty, and thirty years ago, and the same people that do the majority of that work today... AMERICANS.

Illegals make up roughly 23% of the agricultural labor force, 17% of the construction labor force, and 14% of the service industry labor force... and Americans do the rest.

[utherdoul]

well maybe its different in other parts of the country (taxachusetts is where I am), around here nobody will take those jobs. A few American teenagers do, but without a large presence of migrant workers things would grind to a halt.

Because taxes and the cost of living are so high here we’ve got a divide between very rich retired folk, and migrant workers who do basic tasks. Reason being there isn’t enough native labor to get those things done at wages which can be paid. Without workers we’d be in a sore spot.

[sheana]

You know I actually have Americans that work for me. I have a LEGAL Basque immigrant from Spain for a gardener. I have a garden variety caucasian gal that cleans my house once a month. When we have trees trimmed. house painted, etc. I always tell every company that I call for a quote that if they hire illegals they will not work for me....and that I will find out and turn them in.
With a little effort it is quite easy to find Americans to do all those jobs.

[sheana]

I call BS. I am in an area inundated by illegals and I still find plenty of Americans to do the jobs I need done.

[snowrip]

Anyone that does work, or has ever done work, on my home is an American.

[tumblindice]

“Because taxes and the cost of living are so high here we’ve got a divide between very rich retired folk, and migrant workers who do basic tasks . . . Without workers we’d be in a sore spot.”

You’re a twenty year old, libertarian business major?
Maybe things should grind to a halt in Taxachusetts if the residents are too lazy to mow their own lawns or too cheap to pay another American to do it.

[RegulatorCountry]

Without them to do the heavy dirty labor nobody else would do, who would dish out french fries or bag groceries, or tile my roof?

Teenagers, in the instance of serving you fries or bagging your groceries. Alcoholics, in the instance of tiling your roof, lol. It wasn't that long ago; surely you remember how these things were done, prior to this influx of foreign nationals, that is without precedent in modern history, with the possible exception of warfare.

[sheana]

hehe I remeber being 20. That was before I got my Master’s in Bus Ad with a concentration in Accounting, and way before I worked for 30 years while having a family. All the aforementioned kind of cured my idealism.
There is home for him yet. ;)

[sheana]

sheesh looks like my typing class from high school didn’t take tho ;)
home=hope

[tumblindice]

“The way economists solve this problem – to find out which combination of actions by each government is rational – is to look for the Nash equilibria, the combination of actions where each party is taking the best action given the other party’s action. There are potentially two: if a is less than d then the U.S. builds a fence and Mexico doesn’t reform. If a exceeds d then the U.S. doesn’t build a fence and Mexico doesn’t reform.”

Is that from a `Reason’ blog? They’re all OBL neo-hippies.
And is that reference to the `A Beautiful Mind’ John Nash, and his bar strategy for picking up chicks?
Why, that’s just crazy talk, it sounds like cocktail chatter at the chairman’s house . . .

[indylindy]

How about those rich, retired folks paying to hire some Americans?

[tumblindice]

Puppies exude a hormone that stops older dogs from tearing their throats out.
I try to remember that when dealing with young conservatives.
Yep, the “My Gawd—they’re taking most of my check!” was my epiphany.

[Shuttle Shucker]

Meanwhile, Mexico’s about to louse up its taxation scheme even further:

http://www.freerepublic.com/focus/f-news/1845258/posts

[reformedliberal]

The few migrants we have in SW WI either work construction for a prefab home manufacturer, work in various meat packing jobs, large dairy operations and the many mid-sized organic farming operations. Some are true agricultural migrants who work the vegetable fields contracted to Libby or Green Giant. Caucasian teens and older workers work in Walmart, fast food and other retail/service areas. I have been lucky enough to find a very talented landscaper who has a graduate university degree, is working on yet another MS and who loves landscaping work. Her dream is have an arboretum. She hires Caucasian young people when she needs more crew. My monthly cleaners are two Caucasian ladies in their 60s. Motel cleaners and kitchen staff are all Caucasian Americans.

Many carpenters would work for the manufactured home company, if they paid over $12/hr. People would work for the dairies/organic farms if they were treated better. Some farms pay in produce, only, for hand weeders, but hire migrants to drive tractor at $10/hr. Caucasians, including women, would work in the meat packing plants, but again: it is not well paid for dangerous work, because migrants will do it for less.

I have spoken to people who hire migrants and they say that all their workers have papers, but, if pressed, they acknowledge the papers are probably fraudulent.I see young Latino families in Walmart and they pay with welfare cards. This is a relatively newer phenomona here. I have only begun to notice it or hear about it within the past 18 months or so.

We have more than our share of wealthy and retired people who have moved here from CA, CO, IL, MN because of all the organic industry and the peace, quiet and relatively low-cost land/COL, compared to their former residences. Few of them are crying for workers or disdain doing their own labor on their own properties. What they cannot do themselves, they hire out to native-born Americans. I know the people they hire.

So: why do you think people in your area are so different from the people in mine? They aren't all wealthier, they aren't all more highly educated, they certainly aren't necessarily more cultured or even politically correct. Since we have traveled extensively and enjoy resorts, we have met many residents of the NE/New England/major urban areas. IMO, they are far more cheap and far more influenced by their peers than are folks from the Heartland. If the neighbor has a Salvadoran gardener, they have to have one, as well.If the neighbor's housekeeper works for $200/week, they want someone who will work for that or for less. I have often wondered if such individuals would perhaps benefit as human beings if they had less access to indentured servants.

Just sayin'........

[Shuttle Shucker]

And it’s also money given to monopolies that Mexico will only reform if we continue to demand that Mexico clean up its own house before asking ours to be more accomodating. Mexico’s government is starting to listen & improve the place though, the more we crack down on our borders (which is long overdue):

http://www.freerepublic.com/focus/f-news/1844254/posts

[utherdoul]

well then maybe I’m wrong. I retract what I’ve said earlier. I guess I need to do more research before spouting off.

[LNewman]

See http://www.uspatriotcompanies.com/

I received an email yesterday from one of the founders saying NBC Nightly News with Brian Williams will be airing a story on their young organization ( a little over a week old).

You might ask your legal employers if they are aware of this free service.

[LNewman]

Oops! The NBC coverage is supposed to air this Thursday evening.

[LNewman]

In my So. Cal. area, it is difficult to know who you are hiring. Most of my neighbors and I hire via word of mouth. I also check out work truck signage for the good or bad and make a note of the outfit.

That's why I was so glad to hear about this effort and would like to see these signs posted in local establishments:

[Mamzelle]

Re: I have often wondered if such individuals would perhaps benefit as human beings if they had less access to indentured servants. ))

Hear, hear!!! Indeed, and well said!!

At some point we have to recognize this as a class issue. Maybe GW (and Laura Bush, too!) would understand a little better if he hadn't employed a nanny to look after the twins when they were TEENAGERS.

(bump your post)