Thursday, February 21, 2008

Mexican Growth and Illegal Immigration

Mark Thoma at Economists View suggests that compared to McCain and Hillary, Obama is the only one on the right page with respect to the importance of promoting the Mexican standard of living:

Fences don't stop economic forces from working. I think the only viable long-run solution to the immigration problem is to reduce the economic distance between Mexico and the U.S. Obviously, we don't want to do that by reducing our income, so we need to do what we can to help Mexico develop and raise its standard of living. In that regard, I would like to hear more from the presidential candidates on how the U.S. might help to promote business and job development in Mexico. Proposing a tax credit to companies willing to invest in Mexico would be political suicide - tax breaks to U.S. companies willing to move jobs to Mexico probably wouldn't go over well - but if we are going to solve this problem we will have to realize that such investment must take place. If nobody from the outside ever locates in Mexico, if we wait for development to spontaneously erupt on its own from within, it could be a long wait with a high fence repair bill. But tax breaks are but one small part of the government's arsenal, and I would like to know what the candidates plan to do to promote economic development in Mexico. So I checked their websites to see if they say anything about this (in each case I clicked on issues, then immigration):

Obama: "Work with Mexico: Obama believes we need to do more to promote economic development in Mexico to decrease illegal immigration."

Clinton: Doesn't explicitly say anything about development, closest statement is "greater cross-cooperation with our neighbors."

McCain: "Recognize the importance of building strong allies in Mexico and Latin America who reject the siren call of authoritarians like Hugo Chavez, support freedom and democracy, and seek strong domestic economies with abundant economic opportunities for their citizens."

I have to give this one to Obama. I have no problem with promoting free market policies, but McCain is essentially adopting the Washington Consensus as a development strategy and that's not what I had in mind, and it's not a strategy that has been successful. Clinton doesn't mention development in Mexico as a means of stemming illegal immigration - I'm sure she'd give the right answer if asked but it's not on her website - and only Obama makes the clear link between the U.S. helping Mexico to develop and decreases in illegal immigration.

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