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Mexican immigrants sending $1 billion a month to families back home
AMERICAN-STATESMAN ^ | December 14, 2003 | Juan Castillo

Posted on 12/14/2003 11:28:29 AM PST by traumer

Inside his little Western wear store tucked in a corner on East Riverside Drive, Francisco Javier Aceves can't help but feel a kinship with the angular young men who come in to buy jeans, cowboy boots, phone cards and cell phones. As sure as a regular payday, they come in also to wire money to their families back home in Mexico, in places such as Veracruz, Tabasco, Chiapas and Oaxaca.

"Sometimes they come three or four in a car," Aceves said about his customers. "Sometimes they just start lining up to wire money."

The young men live and work in Austin and, depending on their skills, might earn $200 to $400 in a week, although some earn considerably more. They typically send between $100 and $300 every week or every month to family: wives and children, parents, siblings.

Aceves, 45, charges $10 per wire transfer up to $1,000. And because he was in their shoes once, he can't help but marvel that life can indeed come full circle.

The flow of money repeats and re- peats, affirming emotional bonds between people separated by a border -- and economic and social realities that know no border. It is part of a growing phenomenon: Every month, Mexican immigrants working in the United States in mostly low-paying jobs send more than $1 billion to their families back home, more than Mexico earns from tourism or foreign investment.

Large-scale remittances have been around since the history of migration; European immigrants sent remittances back in substantial numbers. What's striking about this flow of money to Mexico, say economists and sociologists, is the explosive rate of growth: nearly 300 percent in little more than a decade. Moreover, the number of senders and the money they dispatched grew even in the face of a slow U.S. economy, a depressed job market and intensified security measures along the border.

A new study estimates that remittances from Mexicans living and working in the United States will soar to $14.5 billion this year, shattering projections by Mexico's central bank, which projected remittances would increase from $9.8 billion in 2002 to $12 billion in 2003.

The money reaches deep and across a broad swath of Mexican society. Indeed, nearly one Mexican in five, 18 percent of the country's 100 million people, regularly gets money from relatives working in the United States, the study found.

A Nov. 24 follow-up report found that 42 percent of adult, foreign-born Hispanics in the United States, about 6 million people, regularly send money to relatives in Latin America and the Caribbean, an amount totaling nearly $30 billion this year.

"Remittance sending (to Mexico) now is really spread out, right up through the middle class and pretty much every corner of the country," said Roberto Suro of the Pew Hispanic Center, a Washington-based nonpartisan research organization. "It's become much more of an urban phenomenon."

The remittance money is keeping Mexican working-class families from slipping into poverty, paying for basics such as food and rent and typically benefiting the recipient and three or four other people.

But between a quarter and a third of recipients surveyed report putting some of the money into savings, educational expenses or small investments.

Linked economies

Experts who study remittances and immigration policy say the record projections underscore how closely the economies of two countries are intertwined. They say the phenomenon reaffirms that the United States is increasingly dependent on foreign-born low-skilled and medium-skilled workers and that these workers are increasingly vital to U.S. economic growth. Mexico also is increasingly dependent on remittances as a source of foreign exchange.

"The U.S. and Mexican labor markets are now totally integrated, despite the artificial barriers created by U.S. immigration law and policy," said Wayne Cornelius, director and founder of the Center for Comparative Immigration Studies at the University of California at San Diego.

During the 1990s, the foreign-born population in the United States grew by 10.7 million people. The population of Mexican natives alone grew from 4.3 million to 8.8 million people during the period, according to the nonprofit American Immigration Law Foundation, which seeks to increase understanding of immigration law and policy.

The number of Mexican immigrant workers grew by nearly 3 million during the '90s, representing one out of every five new U.S. workers, according to the foundation.

In the late 1990s, it became increasingly clear that the money immigrants were sending home was a significant contributor to the Mexican economy. President Vicente Fox took note after his election in 2000, reaching out to his paisanos and paisanas and praising them for what he has called their heroic efforts in sending money to their families.

Remittances, while a significant contributor economically, represent only 1.1 percent of the nation's gross domestic product. But Fox recognizes the importance of his country's citizens working in the United States, a constituency that can be enlisted as the United States and Mexico discuss immigration reforms.

Here to stay

Fernando Lozano Ascencio has researched remittances and Mexican migration to the United States for more than 15 years. Labor migration is "part of the engine of (two) economies," said the sociologist and demography specialist at Mexico's national university and visiting research fellow at the Center for U.S.-Mexican Studies at UC-San Diego.

Jobs, Lozano says, are the No. 1 reason 350,000 to 400,000 Mexicans have entered the United States every year since 1995. Other estimates put the number at half a million people or more per year, the vast majority of them undocumented.

Once in the United States, many immigrants are staying longer or permanently. Rather than reduce migration, increased border enforcement in the wake of the 2001 terrorist attacks has had the unintended consequence of reducing what some call "circular migration," in which Mexicans go back and forth across the border, working on either side for months at a time. "It's not so easy to come and go anymore," Lozano said.

Manuel Orozco, a remittance expert at Inter-American Dialogue, a Washington-based center for policy analysis, says there are other reasons that Mexican immigrants are thinking twice about going home. Orozco says it's expensive to come and go, and in a slow U.S. economy, the Mexicans can't guarantee they'll get work when they return.

"That person might be thinking twice going for visits," he said. "Instead, you send more money."

John Keeley with the Center for Immigration Studies, which advocates strict border enforcement, says the remittance phenomenon is more evidence that the border is porous. His group takes issue with those who say border control has been tightened.

"Our government is not in much of a better position to assess who's coming and who's going," Keeley said. "President Bush and Congress have done nothing to address a system that ensures that mass immigration continues."

The Inter-American Development Bank and Pew Hispanic Center-sponsored study does not address the legal status of the 6 million foreign-born Latinos who regularly send money to Mexico and Latin America.

An estimated 33 million immigrants of various nationalities live in the United States. Estimates put the undocumented immigrant population in the United States between 8 million and 10 million, with4 million to 5 million coming from Mexico. The Immigration and Naturalization Service estimated that 1 million undocumented people resided in Texas in 2002.

Fox made sure to note the symbiotic relationship migrants represent in his November visits with governors of Texas, New Mexico and Arizona. The governors "now accept the idea that (immigrants) contribute enormously to the development of their economies and are a benefit to their states," Fox said.

Fox's trip was widely viewed as an effort to enlist the help of Mexican migrants in achieving immigration reform, notable because the Mexican government historically ignored illegal immigration.

Lozano says Fox has assigned Mexican migrants and the money they send back home a strategic role in the development of small rural communities. The Mexican government matches remittances earmarked for community purposes, such as for roads or infrastructure. Projects financed this way are said to number in the hundreds.

Some Mexicans have strongly criticized Fox, saying the Mexican government is culpable for not addressing poverty and the lack of jobs and opportunities, conditions that send many paisanos north of the border.

"It is true that Mexico has to develop faster," said Francisco Javier Alejo, Mexico's consul general in Austin. "But it is true that Mexico needs the assistance from its richer neighbors and partners in order to accelerate its development, to create more job opportunities."

Alejo says free trade alone is not sufficient to stimulate development. "That is the main lesson from this."

He says efforts under the North American Free Trade Agreement to create a macroeconomic region are limited because only the goods and capital markets are opened. "We still don't have an integrated labor market in the region. And that has to be a goal."

Jobs are the big draw

Experts attribute the surge in remittances to several factors, chiefly growing permanent migration from Mexico since the 1990s.

In the 1990s the U.S. government began tightening immigration enforcement in Texas and California, pushing border crossers into remote areas. The desolate Arizona desert became a popular -- and deadly -- crossing point for hundreds of thousands of undocumented immigrants. Border Patrol officials reported more than 145 immigrant deaths in the Arizona desert in the fiscal year that ended in September 2002.

According to Cornelius, from 1994 through mid-2001, about 1,700 deaths were reported to the Mexican consulates along the Southwest border.

The increased risks of crossing, however, appear to have had little impact on immigrants.

Lozano says almost 80 percent of migrants are looking for a job, or one that pays better.

In Mexico, a worker earns a meager $60 to $70 for a 48-hour work week at one of the maquiladoras, factories, created under the NAFTA. U.S. jobs, even low-skilled minimum-wage work, pay much more.

Experts cite additional factors behind the remittance increases: More firms, including major U.S. banks and credit unions, are competing for the lucrative remittance market, which is making it cheaper to send money; more money is passing via official channels; Banco de México has improved its system of measuring remittances.

Laying a foundation

"In an ideal world, people wouldn't feel compelled to leave their homes," said Suro, of the Pew Hispanic Center.

Aceves didn't feel compelled to leave his homeland. He felt compelled to stay in the United States.

Like his customers, Aceves was young when he left his home on the outskirts of Guadalajara, Jalisco, 26 years ago. He says he was only looking for adventure. Thought he'd make some money and return in six months to resume his studies at the university. That was the plan, anyway.

In Houston, he met the woman who would become his wife, Maria Elena Aceves. Soon, Aceves had a wife, a baby and a great job managing a tailoring shop. The tailoring skills he'd honed in his hometown of Zapotlanéjo, Jalisco, known for its tailors and weavers, allowed him to apply for legal permanent residence.

"When I started missing things (in Mexico) was when I realized that I was going to stay here," he said. His gaze sharpens, as if reliving that moment.

Three and a half years after swimming across the Rio Grande into Laredo, Aceves became a United States citizen.

Like his young customers, soon after entering the United States and finding work, Aceves began regularly sending money to family. He's never stopped. Aceves doesn't need to send as much as he once did; he comes from a large family and his siblings also help their mother. But Maria del Rosario Aceves, who still lives in Zapotlanéjo, can count on receiving about $50 every other week from her son.

Aceves tells of the young men who come into his shop. Many are about to get married. Their goal is to make money, build their house back home a piece at a time, then go back.

"They tell me this," Aceves said. He demonstrates someone plunking down money on a counter. "They'll say, `With this, I'm going to put the roof on my house.' "

He pauses, smiling slowly. "They're excited!"


TOPICS: Business/Economy; News/Current Events
KEYWORDS: aliens; biggovfailure; criminals; culturewar; foreignoccupation; illegalmexican; illegalnotimmigrant; illegals; immigrantlist; insane; invasion; lawbreakers; mexicanimmigrants; mexicans; mexicoplunders; multiculturalism; remittances; taxfree; thewelfarestate; votebuying; welfarestate
" Here to stay... "
1 posted on 12/14/2003 11:28:29 AM PST by traumer
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To: traumer
I believe this qualifies as a "great sucking sound".
2 posted on 12/14/2003 11:31:05 AM PST by BenLurkin (Socialism is Slavery)
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To: traumer
Why would they want to leave? America is a wonderful place to live! Why they can even make all of this money tax free! (sarcasm off) 1 BILLION dollars? What in the world are we doing here?!!
My tag line says it all..
3 posted on 12/14/2003 11:47:36 AM PST by firehunter (We deserve what we put up with...)
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To: traumer
when you go to Wal-Mart, as least one of the ones in the Midwest, they have a few signs in Customer Service ... I was noticing them again last night ...

Money orders: 46 cents

Paycheck cashing: $3

Wire Money to Mexico: $8.50

kinda says it all ...
4 posted on 12/14/2003 11:50:37 AM PST by Bobby777
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To: traumer
Since US Dollars can only be ultimately redeemed in the USA for products or services or investments, what is the problem with the route they take? If they are not redeemed, they are just scrap paper.
When you cash a paycheck do you care if the Dollars come from the Bank of Japan, China, America?
5 posted on 12/14/2003 11:54:32 AM PST by BillM
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To: snopercod
Bump.
6 posted on 12/14/2003 12:06:28 PM PST by First_Salute (May God save our democratic-republican government, from a government by judiciary.)
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To: traumer
When I used to live in California, I went to Arizona to work for a while. Each week I would cash my paycheck, run to the Post Office for a money order, and send it home.

I put a roof on my house, too. What's the difference here?

7 posted on 12/14/2003 12:16:05 PM PST by snopercod (The federal government will spend $21,000 per household in 2003, up from $16,000 in 1999.)
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To: traumer
According to free traders, this doesn't matter because it is useless paper that must be used to turn around and buy US goods, which is good for our economy.
8 posted on 12/14/2003 12:23:39 PM PST by sixmil
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To: traumer
IS there any wonder why the Mexican government wants to make it easier for illegals to stay here by promoting driver's licenses, the right to vote in Mexican elections, and Mexican ID cards for opening up bank accounts. This is critical to their national economy. While Republicans have some complicity in this with respect to the lack of vigor in enforcing our immigration laws, Democrats and other Lefties are their big advocates because they want to add them to their power base.
9 posted on 12/14/2003 12:26:51 PM PST by LA Conservative (evil triumphs when good men do nothing)
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To: traumer
This is money looted from the US economy. When the price of illegal alien Mexican criminals to the US economy is calculated, these billions that are lost the the multiplier, e.g., the efect of money that is spent and earned and spent again, has to be included as a negative. It is simply looted. It makes no "new" jobs and enriches no Americans.
10 posted on 12/14/2003 1:11:08 PM PST by Tacis
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To: traumer
What's striking about this flow of money to Mexico, say economists and sociologists, is the explosive rate of growth: nearly 300 percent in little more than a decade. Moreover, the number of senders and the money they dispatched grew even in the face of a slow U.S. economy, a depressed job market and intensified security measures along the border.

Gee, do ya think some of it might be drug money?

11 posted on 12/14/2003 1:38:32 PM PST by DumpsterDiver
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To: snopercod
One generates value INSIDE the USA the other removes value form the USA. The immigrants treat the USA as a "pilaging turf" to be raped and then send to the true homeland.
12 posted on 12/14/2003 2:30:16 PM PST by longtermmemmory (Vote!)
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To: DumpsterDiver
it might also be due to the fact of better tracking.

illegals now have the ability to bank accounts.

mandatory money transfer reporting amounts are extremely low.

We know more.
13 posted on 12/14/2003 2:40:38 PM PST by longtermmemmory (Vote!)
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To: longtermmemmory
mandatory money transfer reporting amounts are extremely low.

I don't understand what you're saying here. Can you elaborate a little?

14 posted on 12/14/2003 2:55:09 PM PST by DumpsterDiver
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To: traumer
Make them all citizens of the U.S.A. then they can sponsor more illegals...to become citizens..
and they will all be eligible for taxpayer funded "support"......

Not to mention...all eligible for affirmative action appointments, promotions, business loans, grants & scholarships for education as well as start ups for farms and new businesses, preferences in all areas...(and when their ventures fail the first couple of times...bailouts)

Gotta merge the USA Canada and Mexico...gotta mix up the USA with plenty of Mexicans Arabs make it a real international global community...give them all the vote...fill the country up with criminals so that we become a police state willing to trade safety and security for freedom
15 posted on 12/14/2003 3:01:05 PM PST by joesnuffy (Moderate Islam Is For Dilettantes)
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To: sixmil
According to protectionists, this matters because it is paper that is too valuable to be trusted in the hands of foreigners, which only Pat Buchanan can determine, although he doesn't know how to put an end to the matter.
16 posted on 12/14/2003 3:03:26 PM PST by 1rudeboy
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To: traumer
The young men live and work in Austin and, depending on their skills, might earn $200 to $400 in a week, although some earn considerably more.

$400 a week = $20000 a year, in Texas, this is not poverty level. Especially when you considrer at least some of the time there are no taxes paid.

17 posted on 12/14/2003 5:47:04 PM PST by ikka
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To: DumpsterDiver
The amount that is required to be reported is low.

I believe as little as $200.00. Compare this with $10,000 domestic transactions.
18 posted on 12/14/2003 9:18:41 PM PST by longtermmemmory (Vote!)
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To: 1rudeboy
According to protectionists reciprocal free traders, this matters because it is paper that is too valuable to be trusted in the hands of foreigners better put to use here, which only Pat Buchanan can determine, although he doesn't know how to put an end to the matter.
And just a few weeks ago, someone asked me what the connection was between unilateral free traders and open borders types.

19 posted on 12/14/2003 9:48:31 PM PST by sixmil
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To: BillM
Most people in this forum are not well-enough informed to understand that the removal of cash from circulation in the U.S. is actually helping keep inflation down.

It's paper that it's going to be used in some other country in exchange for goods and services there.

Who cares?

We just print more when we need more.
20 posted on 12/14/2003 9:58:38 PM PST by Luis Gonzalez (The Gift Is To See The Trout.)
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To: 1rudeboy
Some years ago, the government decided that we needed "new" money, so they redesigned the paper currency.

One day, the new "improved" bills were in circulation.

Did anyone ask you to turn in your bills to the bank in exchange for the new ones?

No, they were simply added to the economy.

They stole about 15% of the purchase power of our money by doing that.

Think of the economy as being a pot of soup, and money being the water that's this soup's main ingredient.

You add water to the soup, what happens?

It thins out.

Money is only worth that which you can purchase with it.

The government introduces all these new bills, and receives the full benefit of the current value of the dollar at the time of the introduction of the new currency, once these bills become fully integrated into the economy (the soup is thin now), the old bills, their buying power devalued, are slowly removed from circulation.

Yet, the lowered purchasing value of the dollar is not regained.

Inflation is a tax.

By the way, there are new, improved bills entering the economy these days...

21 posted on 12/14/2003 10:09:01 PM PST by Luis Gonzalez (The Gift Is To See The Trout.)
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To: sixmil
You are the one that is confusing free movement of capital and free movement of people. One can exist without the other, despite the most desperate attempts by protectionists to link the two.
22 posted on 12/15/2003 5:20:02 AM PST by 1rudeboy
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To: *immigrant_list; A Navy Vet; Lion Den Dan; Free the USA; Libertarianize the GOP; madfly; B4Ranch; ..
ping
23 posted on 12/15/2003 1:58:54 PM PST by gubamyster
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To: gubamyster
Some figgures put it higher than that, they put it at fourteen billion a year. Government and press numbers always lie, one can always multiply their figgures by two or three to get the real deal.
24 posted on 12/15/2003 2:02:44 PM PST by MissAmericanPie
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To: newgeezer
Good for them!
25 posted on 12/15/2003 2:05:17 PM PST by biblewonk (I must try to answer all bible questions.)
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To: DumpsterDiver
Gee, do ya think some of it might be drug money?

I'm not sure that is included in the $1 billion a month --- the drug money is the big significant money being sent. Drugs are one thing the country of Mexico does very well. Bringing truckloads of cocaine certainly nets a lot more money than raking leaves.

26 posted on 12/15/2003 4:41:33 PM PST by FITZ
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To: FITZ
I'm not sure that [drug money] is included in the $1 billion a month

Probably it isn't.

Drugs are one thing the country of Mexico does very well.

But are they as good at it as the Colombians? ;)

27 posted on 12/15/2003 4:57:52 PM PST by DumpsterDiver
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To: DumpsterDiver
They work well together on it. Mexico knows full well what's in those big planes arriving from Colombia to the Mexican airports and Colombia knows it's easy to land in Mexico and get the drugs over by land.
28 posted on 12/15/2003 5:00:13 PM PST by FITZ
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To: traumer
I'm not concerned so much about the money they send to Mexico, I'm worried that they might try to send the southwest back to Mexico.
29 posted on 12/15/2003 11:09:30 PM PST by Dan Evans
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To: BillM
Since US Dollars can only be ultimately redeemed in the USA for products or services or investments, what is the problem with the route they take? If they are not redeemed, they are just scrap paper. When you cash a paycheck do you care if the Dollars come from the Bank of Japan, China, America?

YES! you do care. The reason if fairly simple. In order for the US B. of Engraving and Printing to print the money, the US Gov trades US Treasury Bonds (at interest, that is the key) for, get this, PERMISSION from the privately owned "Federal Reserve Bank" (inc.) to print x amount of dollars. The game is that the amount of dollars only covers the face value of the Treasury bonds, NOT the interest charged by the privately owned "Federal Reserve Bank" (inc). Where do the dollars come from to pay back the interest? NOWHERE. They show up as inflation. The federal reserve system is the biggest scam the American People have been subjected to INCLUDING SS and the IRS.

To take actual existing physical dollars out of the system is the kiss of death to any attempt to keep in control the inflation rates and the number of trips to the well of the privately owned "Federal Reserve Bank" (inc.)

TLI

30 posted on 12/15/2003 11:13:56 PM PST by TLI (...........ITINERIS IMPENDEO VALHALLA..........)
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To: traumer
How charming. A billion a month. Scumbags continue to be scumbags regardless of where they reside.
31 posted on 12/16/2003 5:44:20 AM PST by Bikers4Bush (Bush and Co. are quickly convincing me that the Constitution Party is our only hope.)
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To: gubamyster; FairOpinion; FoxFang; FITZ; moehoward; Nea Wood; Joe Hadenuf; sangoo; ...
And 'why'do we have such a huge deficit?
32 posted on 12/16/2003 10:27:24 AM PST by JustPiper (Saddam gives new meaning to "Ace in the Hole")
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To: JustPiper
And 'why' do we have such a huge deficit?

Do you really have to ask? Bush and Ridge could find out who the illegals are via the banks that transfer money to Mexico. Instead he wants to match willing employers to will employees. Bush wants a little piece of the patchwork quilt so us stupid Americans won't think that it is blanket amnesty.

33 posted on 12/16/2003 11:27:06 AM PST by texastoo (What a Continent!!! (sarcasm))
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