How mass migration destabilizes rich and poor countries alike
Conn Carroll
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We already know how mass migration caused by President Joe Biden’s catch-and-release border policies has destabilized not only communities along the border but also big cities such as New York, Chicago, and Washington.
What is less well known is that by making it easier for immigrants to work here, Biden is also destabilizing the countries these migrants come from. The Wall Street Journal reports:
Since 2010, remittances to the developing world have nearly doubled, rising to a record $647 billion last year, more than foreign direct investments to those countries and more than international development aid, according to the World Bank. Some economists say that if remittances become too big, they can hurt longer-term development and create governance problems. Connel Fullenkamp, a Duke University economist, said remittances can start to become problematic once they go above 5% to 10% of a nation’s gross domestic product. The money can reduce incentives to work for those who receive the funds, he said. They can also curb demands on the government to fix domestic problems that cause migration in the first place. “If you get remittances, it causes you to care less about what is really going on in your own backyard, because you can always tap your relatives overseas for more transfers,” said Fullenkamp, who has written studies on remittances for the International Monetary Fund. “Politicians are well aware.”
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Keep that 5%-to-10% of GDP number in mind because the Wall Street Journal then reports:
In Nicaragua, remittances more than doubled from 2018 to 2022 after President Ortega violently put down protests. This year, they are expected to account for about 33% of the country’s GDP, one of the highest rates in Latin America, said Manuel Orozco, a Nicaraguan economist at the Inter-American Dialogue.
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Nicaragua isn’t the only country in the Western Hemisphere where the economy has become dependent on remittances. According to the World Bank, Honduras (26.8%), El Salvador (23.7%), Haiti (22.4%), and Guatemala (19.1%) all have dangerously high levels of remittance dependency.
It appears that one of the “root causes” of mass migration from many developing countries to the United States is existing migrant populations already in the U.S.