Wednesday, January 4, 2017

Trump's plan to increase immigration

Not that I necessarily have a problem with that—I like immigrants! Still, it's going to be ironic.
I can't remember where I read this, but one of the more secret purposes of the NAFTA agreement among the US, Canada, and Mexico, was supposed to be decreasing immigration, including undocumented immigration, from Mexico into the United States, by enabling Mexico to provide good jobs for its citizens at home. In fact it wasn't exactly a secret, as The Times reported at the time,
The Clinton Administration contends the pact would also discourage illegal immigration from Mexico by creating jobs there; critics say that the pact would fuel illegal immigration by throwing thousands of Mexicans out of work in uncompetitive industries like corn farming.
And the Clinton administration was right on that: it has definitely succeeded in the long run. The effective thing being that the corn farming jobs didn't pay enough to keep people alive anyway and the maquiladora jobs did. After five or so years when the most alarmist predictions seemed to be coming true, the rate started to decline, ending up pretty near net zero (as many people now emigrate from US to Mexico as make the trip the other way).

It took ten or fifteen years of investment to get there, but the crisis on which Donald J. Trump built his hysterical campaign ("We have to build a wall!") hasn't existed for some time.

It's just a little ironic that the Trump who is so concerned about immigration is so determined to upend the treaty that has been keeping immigration at bay, and it strikes me that the Trumpian economic policy is setting forces into play that will, sooner rather than later, start Mexican immigration up again in a big way.

It started showing immediately with the presidential election, which triggered a slump in the Mexican stock market and the value of the peso. Now, it looks like every time Trump pulls one of his little stunts of trying to suggest that his imperial presence preserves American jobs, markets will tremble and things in the Mexican economy will get worse; this just happened on the fairly large scale when Ford Motor Company canceled plans to build a $1.6-billion factory in San Luis Potosi in favor of a $700-million one in Michigan. Even though, as you'd expect, Trump has little to do with it.

I doubt Trump is going to succeed at anything like renegotiating NAFTA (if he had a clue what he was doing and seriously wanted to renegotiate NAFTA, which is probably a good idea, what he'd do is sign on to the Trans-Pacific Partnership, which would effectively put NAFTA out of business, since the terms of the old treaty for Mexico, Canada, and the US would be replaced by the much more beneficial, labor- and environment-sensitive new ones, in which the sovereign right to regulate is fully recognized and all sorts of protections incorporated, but you don't have to pay any attention to me), but these little Trumpy explosions of triumph, imaginarily saved 700 jobs at a time, are going to keep happening, rocking the Mexican financial establishment.

Meanwhile, the price of gas is going to start rising (this has just begun in Mexico, as it happens, due to a somewhat strangely timed deregulation, and with the accompaniment of furious protest), and that will be bad for the Mexican economy in general and their auto industry in particular, but good for ours, which is devoting increasing resources to electric and hybrid vehicles (thanks, Obama!). Ford is anticipating this in the new move, in fact, moving investment from Mexican gas hogs to Michigan electrics; that's what the move is actually about, not pleasing the Emperor.

I predict that in this way solid employment will be dropping in Mexico as it falls into a crisis of general weakness, inflation, and declining manufacturing, and immigration, particularly undocumented, will start to rise. Specifically as a result of Trump policy or his tweets, whichever comes first on any given occasion. Trump is going to Make America Mexican Again (#MAMA!) with more "illegals" than ever.

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