How Illegal Immigration Hurts the Mexican Economy

2008-08-22 13:31:14 (GMT) (WiredPRNews.com - Business, Featured Stories)

Fort Worth, TX (WiredPRnews.com)—One of the rarely-reported aspects of illegal immigration across the Southern US border is how much it hurts the Mexican economy and its people. Aside from the deaths in the desert and the physical abuse from the coyotes and drug traffickers, the exportation of Mexico’s poverty to the United States prevents Mexico from improving its infrastructure and business climate.

In the short term, Mexico benefits heavily from the remittances sent from illegal aliens who work in the US. It’s a win-win situation for Mexico because of the wealth of hard currency coming into the country and the reduced need for the government to build and improve roads, schools and jails. However, in the long term it shows the fundamental problems of the Mexican economy.

Like most third-world nations, there is a large underclass, a significant and powerful upper class, and a nearly non-existent middle class. While the Mexican middle class is slowly expanding, it will only do so at a snail’s pace when the nation exports its poor instead of improving them.

How does a nation do this? By seriously rooting out government corruption, investing in solid infrastructure improvements (roads and schools) and making the economy more business friendly. Businesses, not governments, are responsible for creating jobs in capitalist economies. Yet most firms are reluctant to expand in a nation that is rife with corruption and a decaying infrastructure. Why would any firm want to set up retail outlets or transport its goods if the threat of extortion by government officials or robbery by groups of bandits is a serious concern?

One goal should be efficiently tapping Mexico’s wealth of oil reserves by deregulating and disbanding the government-run oil company PEMEX. This is just another one of the countless examples of why privately owned, profit-driven entities are far more efficient and effective than socialized, government-run bureaucracies.

With increased immigration enforcement and a weaker dollar, Mexico may be forced to improve its economy and internal infrastructure faster than it had anticipated.

Jason Meeks - Staff Reporter - Business News Distribution Service