Our march toward Lexington Green continues.
SNIP---My bill is simple: If the person wiring money to Mexico is here legally, great. If he can’t prove legal status, then he gets slapped with a fee which goes directly to border security and enforcement. This would cause two separate effects, both very positive.
On one side of the coin, GAO estimates that my bill could bring in up to $1 billion from illegal immigrants that would go directly towards border security and enforcement.
On the flip side, the report shows it may discourage illegal immigrants from sending the money in the first place. If that dynamic occurs, it would likely lower the amount of revenue raised for border security, but illegal immigration would be strongly discouraged and the money would stay in the U.S. economy.
We have noted this exact process is already in place for remittances sent to Cuba. Anyone sending money to Cuba is required to fill out a Cuban Remittance Affidavit form, verifying who the sender is (with ID) and specifying who the recipient is.
Previously we shared a recent discovery that remittances to Mexico, from the U.S., now account for almost $25 billion annually (year 2015), and actually exceed the entire revenue generated by the Mexican Oil industry. Yes, this means more U.S. dollars are sent to Mexico by Mexican citizens working in the U.S. than the Mexican economy generates itself internally – as measured by their energy sector GDP.
As a specific and direct consequence this means Mexico is now more economically dependent than ever on the U.S. This is the leverage candidate Donald Trump describes to get the Mexican government to pay for the Southern Border Security Wall.
If you take a more modest figure of $25 billion annually, and if the U.S. were to impose a 4% transfer fee on Mexican remittances, the revenue generated would also be $1 Billion per year. Over 10 years (budgetary timeline) that would be $10 billion, which is the currently estimated cost of the 1,000 mile wall.