A Better Way to End Unauthorized Immigration

By Douglas Massey, Miller-McCune.com. Posted January 8, 2009.

Although some people do migrate to maximize earnings, many others move abroad to finance the acquisition of a home, a business or land in the absence of viable lending markets. For example, according to a 1995 study by Laura Huntoon, a professor of planning at the University of Arizona, Spanish migrants to Germany came disproportionately from regions with high interest rates and returned to purchase houses with money they had saved in the north. The absence of well-developed social insurance and pension programs has also been shown to spur emigration.

Although Spanish entry into the EU may have failed to eliminate north-south differentials in income, it did mitigate the various market and insurance failures that had been driving migrants outward for decades. These problems were addressed with considerable assistance from the EU’s wealthier countries. In recognition that structural economic change is expensive and time-consuming, the EU made available "structural adjustment funds" to Spain to subsidize the modernization of its infrastructure.

The European Social Fund was established to invest money in education, vocational training and occupational retraining, increasing workers’ ability to adapt to industrial change and promoting greater mobility and flexibility. The European Regional Development Fund was founded to invest in regions with average incomes of less than 75 percent of the EU average, hoping to redress geographic imbalances and promote the construction and renewal of infrastructure. Finally, the European Cohesion Fund was created to invest in environmental protection, human health and transportation.

Although there have been fluctuations in response to economic cycles, the size of these transfers has steadily grown. From levels of zero before it joined the EU, transfers to Spain from the European Regional Development Fund grew to $3.5 billion in 1999. Transfers from the European Social Fund totaled around $2 billion per year in 1999, and after its inception in 1992, transfers from the Social Cohesion Fund rose to peak at around $1.7 billion in 1996 before dropping back to around $1.2 billion in 1999. EU investments in Spain from 1986 to the end of the 20th century totaled at least $51.9 billion.

These funds, and the institutional convergence and market harmonization they enabled, led to the curtailment of emigration from Spain -- despite the persistence of a large north-south gap in national income and continuing high domestic unemployment. Rising access to markets for capital, credit and insurance, ongoing improvements in public infrastructure and a decline in the relative income gap transformed Spain in a few short years from a net exporter to a net importer of labor and made it an integral part of European society.

Market unification played out very differently in North America, and so did immigration patterns. Unlike their European counterparts, Canadians and Americans were unwilling to commit to full-blown political and economic integration within North America, despite their desire for greater trade and investment opportunities to the south. U.S. officials led the way in negotiating a limited integration of North American markets that paid virtually no attention to institutional and social concerns and provided no assistance whatsoever to Mexico to undertake necessary structural adjustments.

As Maxwell Cameron of the University of British Columbia and Brian Tomlin of Carleton University have shown, Mexican President Salinas and his technocratic ministers tolerated this one-sided negotiation because they very badly wanted a trade agreement, for the same reasons that Spain sought entry into the EU: to institutionalize economic reforms and to attract new foreign investment. The Mexicans were just dealing with less enlightened negotiating partners.

The first Bush administration took advantage of asymmetries of power and wealth to drive a very hard bargain, one that secured maximum U.S. access to Mexican resources and markets while conceding as little as possible to Mexico. U.S. firms gained access to Mexico’s financial, agricultural, energy, textile and manufacturing sectors, but Mexican firms were blocked in their efforts to access the U.S. transport, agricultural and textile sectors. While Mexico was forced ultimately to dismantle its system of agricultural subsidies and tariffs, the U.S. was able to keep most of its own.

Although labor and environmental concerns were subsequently addressed in weak and nebulously worded "side agreements" during the Clinton administration, little attention was paid to structural integration or institutional harmonization. U.S. trade representatives summarily rejected structural adjustment subsidies, social harmonization policies, provisions for labor mobility and immigration reform as unfit even for discussion. In contrast to the EU program of comprehensive integration, the NAFTA program was one of selective integration and unilateral action.

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Douglas Massey is the Henry G. Bryant Professor of Sociology and Public Affairs at Princeton University and president of the American Academy of Political and Social Science.

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