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 Editorials | January 2007 
Free Trade, an End to Corruption are Mexico's Tickets to Prosperity
 Victor Davis Hanson - mercurynews.com
We hear all sorts of solutions for ending illegal immigration: Build a wall. Beef up border security. Fine employers, and create a massive guest-worker program. Or America could insist on tamper-proof identification cards, or detention, deportation or even amnesty for some illegal aliens - or all of these measures somehow combined.
But ultimately the solution lies in the hope that a Tijuana might become as prosperous as a San Diego - now a few miles away but a world apart.
After all, Hong Kong used to be a magnet for illegal immigrants who streamed in from impoverished communist China. Not so much any longer. Shanghai, for example, in two decades has become almost as wealthy as the old British colony.
East Berliners used to risk their lives to cross the wall into the West. Now billions of dollars are being invested in restoring the eastern half of a united Germany's capital.
Since World War II, poor workers from largely agrarian, Catholic and authoritarian Spain flocked northward into industrialized, Protestant and more democratic Germany and France to find work. Today, Spain's employment and growth rates compare favorably with those of its northern neighbors.
In each of these cases, once poorer regions bordering far wealthier societies have - either by emulation, absorption or coercion - radically liberalized their economic systems. With jobs and capital almost as plentiful at home as abroad, few wish to leave.
When Mexico follows suit, its relationship with the United States will resemble our connection with Canada. That should be our goal. Our northern neighbor's economy and political system are comparable to America's - and thus the number of Canadians arriving here is small and almost the same as the number of Americans leaving for Canada. And by any benchmark, the weather, arable land and coastline of Canada are not nearly as inviting as Mexico's.
Yet currently, Mexico's per capita gross domestic product is about a quarter of the United States'. Wages in Mexico are far lower than in America. No wonder Mexicans come here by the millions.
So how will Mexico ever achieve parity with the United States?
The Mexican government must begin selling off inefficient state enterprises, especially in gas and oil. It should offer greater protection of property rights and ensure title searches. Mexico must stop the old nationalist rhetoric and welcome foreign investment, create a transparent judicial system and allow land to be freely bought and sold.
Most important, the Mexican bureaucracy must end the endemic corruption that so exasperates foreign investors who would otherwise bring to Mexico efficient job-producing businesses.
There is no chance of Mexico being absorbed by its neighbor as East Germany was by the West. America will not create a continental union as happened in Europe and which so benefits Spain. Nor can even we count on complacent Mexican elites to believe they can become richer by deregulating their economy and competing in the global marketplace as has happened in China. Apprehensive Chinese leaders, after all, changed their rules only because they thought they had no choice after seeing the Soviet Union fall.
So what can the United States do?
Offer both help and tough love.
Granting Mexico favorable trade incentives is cheaper in the long run than dealing with the social problems caused by illegal immigration and the economic consequences of billions of U.S. dollars being sent southward from Mexican workers. The North American Free Trade Agreement, however controversial, has probably helped decrease Mexico's general poverty rate and increase its gross domestic product.
By closing the borders, the United States would stop subsidizing Mexican failure. At present, workers come to America not only because of higher wages, but also on the assumption that their cash income will often be untaxed and augmented by subsidized state health care, housing and education.
Tax evasion and American entitlement help to free up workers' dollars to be sent back to Mexico. In economic terms, that translates to the United States economy subsidizing millions of the unemployed in Mexico through $20 billion annually in cash remittances. This money weakens the incentive of millions in Mexico to seek employment or to demand government reform.
Finally, we need honesty about the problem. Mexico masquerades as a revolutionary socialist state, replete with flashy radical slogans that date back to the old days of Emiliano Zapata and Pancho Villa.
In truth, Mexico City's creed is elitism and a fossilized cronyism. Its privileged few have hurt millions of their hardworking citizens who deserve far more humane treatment - and sometimes find it only here in America.
Victor Davis Hanson is a classicist and historian at Stanford University's Hoover Institution and a syndicated columnist. |
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