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 Editorials | Issues | April 2007 
Poverty and Starvation Bring on US Immigration "Crisis"
 Karen Nakamura - Coastal Post
| | According to the World Bank, from 2000 to 2004 extreme poverty in Mexico decreased from 24.2% to 17.6% overall and from 42% to 27.9% in rural areas. |
CNN's Larry King interviewed James Edward Olmos during last summer's Latino workers' demonstrations. King was discussing illegal immigration when Olmos suggested that maybe people were flooding across the border because there were few jobs at home, small farms were going under and people were starving.
That truth was hastily swept under the carpet. However, for the past five years, the middle and lower classes in Mexico and Central America have had a rough time economically. Despite that fact and the corresponding flight to the U.S. by Hispanic workers, Forbes Magazine estimates Mexico has 11 billionaires, at least 7 produced during the same period. There are those who blame the North American Free Trade Agreement (NAFTA) and the Central American Free Trade Agreement (CAFTA) for the imbalance.
Mexico touts a free market economy and at the beginning of the 21st century had the highest per capita income in Latin America. However, even though it's the 13th largest economy in the world, 20% of the population receives 55% of the profits with 11 families seeing the lion's share of prosperity.
According to the World Bank, from 2000 to 2004 extreme poverty in Mexico decreased from 24.2% to 17.6% overall and from 42% to 27.9% in rural areas. Those are still very high numbers and would constitute a depression in the United States. Huge gaps remain not only between the rich and poor but also between north and south and urban and rural areas. Many illegal immigrants come from areas of intense poverty throughout Central America. In 2004 it was estimated that the greatest exodus in Central America was from El Salvador (25% of its population), Nicaragua (15%) and Guatemala (8%). Twenty-five per cent, even eight per cent, of a country's population is staggering.
The current economic downturn in the United States has caused similar problems in Mexico. While inflation reached a record low of 3.3% in 2005, last summer the price of tortillas nearly doubled in Mexico City and tripled or quadrupled in other parts of the country. This is no joke. Nutritionists have reported poor Mexicans get more than 40% of their protein from tortillas. The cost increase came from two sources; the inception of NAFTA and CAFTA allowing the Mexican market to be flooded with cheap American corn and putting local farmers out of business. Then the growing international demand for grain-based ethanol dried up the cheap American source.
According to the Washington Post, the crisis exposed Mexico's dependence on tortillas, especially among the poor. The newspaper raised "questions about the powerful businesses that dominate the Mexican corn market and are suspected by some lawmakers and regulators of unfair speculation and monopoly practices."
In January of 2007, Mexico's President Calderon agreed to cap tortilla prices at 78 cents per kilogram, half the highest prices. This act appeared to mark a return to 1999 when the government still controlled tortilla prices and before NAFTA. While Calderon said the cap was a get-tough measure, a spokeswoman for Cargill of Minneapolis, which sells corn to Mexico, said it was a "gentleman's agreement," i.e. no teeth.
Besides Mexico's financial dependence on the United States, economists are concerned about low wages, underemployment for a large segment of the population and inequitable income distribution. Again, according to Wikipedia, few opportunities exist for the largely impoverished "Amerindian" population. In 2005, unemployment stood at 9.6% and worker's rights were basically non-existent.
Ralph Nader said when CAFTA was debated: "...the corporate globalization model has caused the 'race to the bottom' in labor and environmental standards and promotes privatization and deregulation of key public services." His group, Public Citizen, claimed "independent farmers in the US, Canada and Mexico have been hit particularly hard by NAFTA, with thousands wiped out and farmland shifting into the hands of huge agribusiness concerns such as Tyson Foods and Cargill."
The Latin America Post stated on March 14 of this year that Mexico's inflation rate had risen in the past four months on eggs, housing and transportation. The inflation rate overall rose to 4.11% in 12 months, with the core rate at 3.95, the highest since 2002.
Add to that, even in 2001, 50.8% of Central Americans had insufficient income for the minimum requirements of an adequate standard of living. Twenty-three per cent of these people were "living in conditions of extreme poverty not able to cover even their most basic needs." The poverty rate was 69% amongst peasants and agriculture workers.
Those rural sectors already riddled by poverty have been the most adversely affected by CAFTA. There are 224 million people living in poverty in Central America and 96 million in extreme poverty. Mexican wages have fallen in real terms by 36% since 1994, although workers have increased their productivity by 53%.
In 2004 ANEP, the National Association of Public Employees of Costa Rico reported, "One would have hoped that if the richest nation on earth were to enter into a trade agreement with some of the poorest nations in the Western hemisphere that it would do so on the basis of a developmental agenda that deliberately prioritized improving the position of the poorest, improving the labor, social and environmental conditions, as well as the enforcement of the existing labor and environmental laws. Instead, what we have is an agreement, which is based upon reciprocity and the interests of the powerful." |
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