Mexican Immigration and Globalization: The Big Picture

Cliff DuRand
The Center for Global Justice
Thursday, June 1, 2006

As noisy as the immigration debate has been in the U.S., there have been some striking silences. While discussion has focused on how to fix the “immigration mess,” as some call it, little attention has been paid to the causes of the massive migration of Mexicans and Central Americans. As Paul Krugman observed recently in the New York Times, the debate has been between Republicans who want to punish undocumented Mexican workers and Republicans who want to exploit them.

To break out of this sterile debate and find real alternatives, we need to look at the big picture, paying attention to both those factors that push so many people to leave their families and make a perilous journey to a strange land to work and those factors that pull them to the U.S. It is the combination of push and pull that gives context to the vast human drama that is unfolding.

It is often said that immigrants come to fill those jobs that Americans will not take. But seldom is it asked why unemployed citizens shun work in construction, in hotel and restaurant service jobs, and in the meat packing industry. Historically these offered entry-level employment for youth with little in the way of skills. Now those jobs go to immigrants.

Why is that? Is it that Americans have become lazy, as some have intimated? I suspect it has more to do with the low wages that employers can get away with paying to Latinos, especially when they are undocumented and thus too vulnerable to stand up for decent pay and working conditions.

Take the meatpacking industry for example. It once offered relatively well paid jobs. But in recent years wages have pummeled by 40% as the previous workforce has been replaced by immigrants, largely undocumented. Many point a finger at the immigrants as the cause of the decline in wages in the industry. But doesn’t the cause lie with the employers who used immigrants to drive down wages and a government that looked the other way?

Rather than blaming immigrants for taking “our jobs” or depressing wages in unskilled occupations, we should focus attention on the employers who exploit vulnerable immigrants. It’s not enough to institute a guest worker program, as President Bush advocates. That would only ensure delivery to employers of a guaranteed supply of low wage workers totally dependent on their bosses. It would amount to indentured servitude.

The fact of the matter is that the value of the minimum wage in the U.S. (figured in constant dollars) has been declining since its peak in 1968. If you work 40 hours a week for 50 weeks in the year at the legal minimum wage, you will still be well below the official poverty level. You can’t afford to start a family, buy a house (or even a car to get to work) or dream of sending the kids to college. There is no prospect of ever making it into the vaunted “middle class.” The entry-level jobs that once led in that direction have been going abroad for the last 30 years as industrial production has moved off-shore.

That’s why one piece of any comprehensive immigration reform needs to include raising the minimum wage to the level of a living wage. If that were done in all sectors of the economy and strictly enforced, there would be no shortage of willing workers to do the work of America. Such a program would be popular with unions and America’s workers, both Black and white (although not with employers and Bush’s friends), and could help open the way to reconstituting the New Deal coalition and restore progressive politics to the U.S.

But wouldn’t that leave out in the cold the millions of Latinos desperate for work to feed their families back home? That brings us to the “push” factors now driving migration. Another piece of comprehensive immigration reform must be a program of national economic development in the countries to the south of the Rio Grande. And that means a turn away from the export oriented neo-liberal policies that have failed the people of the global South.

A prime example of this failure is Mexico. As a result of its proximity to the U.S. and its incorporation into its economy through NAFTA, Mexico is one of the most globalized countries of the Third World. But rather than making it a part of the First World, as President Salinas had promised, in abandoning its efforts to develop its internal economy Mexico became a dependent appendage of the North. Under the dogma of “free trade,” the country has been opened up to investment from the transnational corporations and now exports much of the fruit of its people’s labor to the U.S. — as well as its impoverished laborers. Mexican economist Enrique Dussel Peters calculates that 73% of Mexican households now live in poverty or extreme poverty (The Polarization of Mexico, p. 157). At the same time, a few have become immensely wealthy in an increasingly polarized society. For example, Carlos Slim is now ranked by Fortune as the third richest man in the world.

This is a harsh assessment. But it is a picture that is emerging from countless serious studies of the effects of globalization. When free trade means that capital and commodities are allowed to move freely across borders, while those borders are barriers to the movement of labor, the result is rising corporate profits and stagnating or declining wages on both sides.

See how this has played out with the maquiladoras. As run-away plants from the U.S., they exert a downward pressure on wages there. And they have a negative impact in Mexico as well. These export oriented production platforms have been the most dynamic sector of the Mexican economy, accounting for 80% of its trade. As a result Mexico has gone from No. 7 in the world in non-oil export growth in 1984 to No. 2. But this is not true export. It is actually intrafirm transfer, as components are brought into the country for assembly by low wage workers and then shipped back to markets in the North. The only benefits left behind are the meager wages. The absence of linkages with domestic suppliers means there is no spin-off promoting domestic industrial development, as Enrique Dussel Peters has argued. To add insult to injury, even the wages often end up going to buy imported consumer goods.

What supplies the maquiladoras with a steady stream of low wage workers is the same source as the flood of migrants: the crisis of family farming that pushes people off the land. In an effort to “modernize” Mexico, for decades government policy has removed support from subsistence farming producing for domestic needs, prioritizing instead commercial agriculture for export. The modification of Article 27 of the Constitution, required by NAFTA, removed legal protection of communal ejido land, opening the way to its privatization.

Further undermining the rural economy has been the flood of cheap subsidized corn imports from the U.S. Under NAFTA, Mexico is committed to a step-by-step removal of tariffs on basic grains until all such barriers on imports will be gone by 2008. At the same time, in the name of free trade, the U.S. was obliged to remove subsidies to its agriculture. However, the Bush administration has actually raised federal subsidies by over 80% –an additional US$91 billion over ten years. Meanwhile, the Mexican government waved the staged removal of tariffs and allowed U.S. agribusiness to dump cheap corn on its market. The decline in domestic production has been predictable. So too has been the impoverishment and displacement of small farmers. Mexico has gone from a country that enjoyed relative food security to being a major importer of the food needed to feed its people. It does however export to the U.S. large quantities of vegetables grown on the vast irrigated fields now owned by agribusiness.

As a result of this destruction of the traditional agriculture that once feed the nation, the main production of many rural communities has become a new crop of young unskilled migrants desperate to work in El Norte. There is a saying in Mexico that for every bushel of corn you dump on us, we’ll send you ten workers. As President Fox recently acknowledged, “migration is a huge opportunity and the world has to capitalize on it productively.” (quoted in El Universal/Miami Herald, May 13, 2006) It is sad that this is the best (and only) opportunity available to so many Mexican youth. But it is a boon to those who capitalize on it.

Jeff Faux of the Economic Policy Institute in Washington claims that 40% of Mexico’s population of over 100 million “would come to the United States if they had the opportunity.” (San Francisco Chronicle, May 18, 2006) Clearly, the corporate led globalization NAFTA represents has been a disaster for the Mexican nation. Roger Bybee and Carolyn Winter have concluded, “The wholesale surge of Mexicans across the border dramatically illustrates that NAFTA was no attempt at a broad uplift of living conditions and democracy in Mexico, but a formula for government-sanctioned corporate plunder benefiting elites on both sides of the border.” ( April 25, 2006)

In light of the interconnection of the U.S. and Mexican economies, it should not be surprising that there has been loose border enforcement in recent decades. It has been “mutually beneficial,” observes Ana Maria Salazar, a former White House, Pentagon and State Department official. “ U.S. companies had access to a cheap workforce and poor Mexicans could get jobs that paid better than anything at home.” (quoted in El Universal/Miami Herald, May 17, 2006) At the same time, it has also contributed to political stability on both sides of the border. As Tom Thompson writes in El Universal/Miami Herald ( May 21, 2006) “the departure of Mexicans…eases the politically explosive migration of the poor and unemployed to Mexico’s largest cities.”

While Mexico is an extreme case, it is not alone. As the globalization of the economies of Central America has deepened since the end of the wars of the 1980s, there has been massive displacement of people from their traditional livelihoods. It is estimated that 15% of the population of these countries emigrated in the 1990s, with El Salvador seeing the largest exodus.

In both the global South and North, globalization has exacted a heavy price from massive numbers of people at the bottom of their societies while enriching those at the top. Piecemeal immigration reforms will not correct this injustice. We need to break from the common assumption that what benefits corporations also benefits Mexican and American workers. What is needed is a program to foster growth and development that isn’t about further enriching Wall Street, major corporations and a handful of Mexican billionaires, but instead creates family-supporting jobs and strengthens local communities.

Without a fundamental reorientation of both of our national economies and a transformation of the relation between the global South and North, immigration “reform” will not solve the problems it claims to address. The factors that push people out of their homeland and that pull them to El Norte have to be addressed. Something like a New Deal within each of our countries and a Marshall Plan between them would be a good start in the right direction. Indeed, if the integration of two very unequal national economies is the goal (rather than the exploitation of the poorer one by the richer one), a more recent relevant model can be found in Europe’s economic integration. There, massive assistance to the poorer countries brought them up, avoiding the inevitable leveling down that would have resulted from unchecked market forces.

Short of some such equalizing plan, the immigration problems that have seized the public’s attention will continue to be with us for a long time to come.