Finance, Mexican Style:

Parasite state perfected as dollars head south

Vicente Fox

The super-rich elite and political hierarchy of Mexico have figured out the ideal way to keep their country afloat with minimal investment on their part. In fact, the worse these corrupt cronies run their country, the better the scam works. Talk about creative financing!

It works like this: the Mexican government fails to make minimal investment in infrastructure, education and employment, thereby forcing the most energetic (and desperate) of its citizens to leave the country to seek work in the U.S. The Mexican expats then send home a rather tidy amount — estimated to be over $14 billion annually. Remittances constitute the second-highest source of hard-currency income for Mexico althouigh el Presidente Fox remarked in September 2003 that remittances "are our biggest source of foreign income, bigger than oil, tourism or foreign investment." Of course, this is $14 billion which has left the American economy, just as surely as if it were a trade deficit.

While many of these American dollars go toward basic living costs for relatives, some also paves roads, digs wells and builds infrastructure — expenses which are generally considered the job of government. But not in Mexico.

It is estimated that there are around 20 million Mexicans living in the U.S., so we are talking about many small remittances — foreign aid financed by busboys and maids. Therefore the prosperity of the cash-sending workers is important to politicians because it means a secure cash flow for Mexico. It naturally helps when little items like healthcare are financed by American taxpayers since it leaves more money available for remittances. No wonder that the Mexican government complains about such things: it says Mexicans in the U.S. are shown “disrespect” if they don't receive benefits because of illegal status, but the concern is really about more money for Mexico.

THE ADVANCED POLITICAL SCAM
Mexican voters elected Vicente Fox as the nation's first president from an opposition party in seven decades. But Fox has been more of the same in how he has called for a totally open border through which Mexicans can pass at will. When Fox was governor of the state of Guanajuato he openly encouraged residents to move to the U.S. and send home lots of remittances. On PBS's Newshour (3/21/00) he shamelessly declared, “There is a huge need for gardeners in the United States. Today we're training in Guanajuato that kind of specialty, and they will be coming down here to the United States.”

Will there be any American gardeners left with such neighbors?

Fox has been energetic in utilizing remittances for his political advantage. He created a program that encouraged Mexican emigres to invest in new businesses in his state. He took over the program Casas Guanajuato, a quasi-government service organization which sets up offices in American communities which have large infiltrations of Mexicans from that state. When Fox left the governor's post, the number of Casas offices was 33.

As part of his election pledges, he promised to press for an international agreement that Mexicans living in the U.S. would have “access” to healthcare. Presumably he meant free services financed by American citizens. Remember that former President Zedillo was an active lobbyist to overturn Prop 187.

Fox has been vocal since his election about opening the border in a European Union-style arrangement. (Of course, the EU consists of countries with similar levels of economic growth and development, so the relationship is one of approximate equals, not of a parasite and host). He claims that an open border will allow Mexico's economy to expand and thereby reduce the need for his countrymen to flee for economic opportunity in El Norte. Mexicans think this is an excellent idea.

Fox also promised to work for higher wages for Mexicans, but low wages are the attraction for the big corporations seeking cheap labor. Sure enough, the last couple years have seen thousands of maquiladoro jobs sent to China. Why pay a Mexican $1 an hour when you can get a Chinese to work for $.25? These days a statuette of the Virgin of Guadelupe might be made in China.

— by Brenda Walker

 

FURTHER READING:

Murder, Money and Mexico
The Frontline broadcast that gives a hint at the corruption of our southern neighbor

History Moving North
The always interesting Robert Kaplan has made something of a study of unsuccessful countries around the globe, and he considers Mexico "a nuanced example of state failure," meaning that it is not as bad as Ruanda. His analysis of Mexico's unique history and current state of affairs are compelling and complex.

Southwest shall secede from U.S., prof predicts
Chicanos want a sovereign Hispanic state. (If they want a Spanish-speaking country full of Latinos, how about Mexico??)

Latin American Billionaires
According to the 2003 update of the Latin Business Chronicle, Mexico is home to half of all Latin America's billionaires (a total of 22, of which 12 are Mexican). Mexico is a rich country and could potentially be a successful nation with a functioning democracy and middle class. However, to be successful it would have to follow in the steps of the Asian tiger economies and invest in education and infrastructure as well as institute political reforms — not likely as long as the dysfunctional relationship with the U.S. allows Mexico to export all its excess people away and get back billions of dollars per year in remittances.

Reconsidering Immigration: Is Mexico a Special Case?
Harvard Professor Samuel Huntington considers the uniquely disturbing nature of the Mexican influx. He regards it a “threat to American societal security” and recommends that Americans react accordingly. (In 1977 and 1978 Mr. Huntington served at the White House as Coordinator of Security Planning for the National Security Council.)

What Americans Should Know About Immigration and President Fox of Mexico
Alan Wall's detailed examination includes his conclusion that America As Safety Valve is ultimately destructive to Mexican society.

(Vicente) Fox in the Hen House
Mexico's agenda for California

Mexican Aggression and Its American Collaborators
Robert Locke and Mark Andrew Dwyer deliver a brief history of the non-friendship, plus analysis of the current state of low-intensity warfare.

Population pressure and conflict
BBC reporting about Balkan violence has interesting material about demographic warfare.

Why all the bowing, scraping toward Mexico?
Why indeed? Columnist Joe Guzzardi asks a question that puzzles many of us, namely why the world's only superpower should be kissing the tortillas of the corrupt nation to the south.

Golden State is home to one-third of nation's Latinos
Many demographic points are made, e.g., that “ 77 percent of the Golden State's Latinos have Mexican origins” and “Nationwide, 58.5 percent of the country's 35.3 million Latinos are Mexican, most of them clustered in the Southwest.”

Mexican pols press for immigration, neglect home front, critics say
This top-notch article contains several quotes nailing the Mexican elite for its complicity in the continuing ruin of the nation, e.g. economist Gary Hufbauer stated, "Basically, the wealthy classes do not want to tax themselves, period." He also noted that the government is hamstrung by tax collections that represent only 14 percent of the country's gross domestic profit, well under the U.S. level of 25 percent to 28 percent.

A Better Idea for Bush's Mexico Trip
As a political ploy designed to attract Hispanic voters, the President's amnesty plan will result in few if any Latinos brought over to the Republican side. In addition, making life easier for Mexico's elite rich forestalls the desperately needed economic reforms that could actually help get the country out of banana republic status.

 

© 2004 Brenda Walker All rights reserved.