Chew on This:

The New Face of Foreign Aid: Remittances!

Support Illegal Immigrants?

By Mery Diaz

Every year I make a trip to my mother’s homeland, Ecuador. I visit family, take road trips, enjoy the unbeatable biodiversity, and of course party till the break of dawn. Over the last few years however, I’ve notice that there is something new to enjoy: Ecuador’s booming cities. Not that Ecuador ever lacked the metropolis, but as in many developing countries, this had been limited to two major modern cities, which still had much progress to be desired. In my last visits, however, I’ve noticed a drastic change for the better. The once modest and scattered developments are now spreading to all corners of the country, from super-malls, world trade centers, miles of private enclosed communities, to the lonesome farm houses atop the Andes mountains. Naturally curious about what has caused such a burst of economic growth, I spent last summer asking random Ecuadorians I met on my road trips about the causes. The number one answer: Remittance!

Remittance, the transfer of money by foreign workers to their home countries, has become for many developing countries, the second largest inflow of moneys. For many other countries remittances exceed foreign aid, foreign investments or even traditional exports. The World Bank has officially estimated that in 2006, migrants sent back $206 billion, and unofficially these figures may be doubled. The Inter-American Dialogue Institute estimates this figure as $298 billion, much higher than the World Bank estimate. In comparison to these figures, US delivered foreign aid falls short. For the fiscal year 2006 United States Agency for International Development (USAID) budget request totals $4.22 billion in the following accounts: Child Survival and Health: $1.252 billion, Development Assistance: $1.103 billion, International Disaster and Famine Assistance: $655.5 million, Transition Initiatives: $325 million, P.L. 480 Food for Peace: $885 million. In addition, USAID will manage the following programs with the Department of State: Support for East European Democracies: $382 million, FREEDOM Support Act: $482 million, and Economic Support Funds: $3.036 billion.

            Looking at these figures, I wonder at the rise of anti-immigrant sentiments of recent years in the United States and abroad. These sentiments have fueled a shockingly increased number of hate crimes, and immigrant worker raids leading to deportation. It seems to me that instead of conspiring against immigrants we should be welcoming immigration of all kinds and for many reasons. If the contention is that immigrants help their own countries but drain our country's resources, I beg to differ! Migrant workers more often than not tend to do labor that domestic workers feel little inclined to do. Migrant workers pay taxes. A remarkable two-thirds of illegal immigrants pay Medicare, Social Security and personal income taxes. Since the 1996 welfare reform effort the use of welfare by undocumented immigrant household was dramatically reduced. Furthermore, in 1996 the Internal Revenue Service began issuing identification numbers to enable illegal immigrants who don't have Social Security numbers to file taxes.  Approximately 8 million of the 12 million or so illegal aliens in the country today file personal income taxes using these numbers, contributing billions to federal coffers. Those aliens who are not self-employed have Social Security and Medicare taxes automatically withheld from their paychecks. Since undocumented workers have only fake numbers, they'll never be able to collect the benefits these taxes are meant to pay for. This amounts to more than $50 billion a year. And let me not get into sales taxes, which contribute to public facilities like schools and property taxes.

     So in the end migrants not only contribute to the reduction of poverty in their countries by funding new businesses, building homes, and fueling foreign economies, but they also reduce the need for US foreign aide and contribute to the US local economy through labor and taxable income (the latter which many will never benefit from). So ask yourself, does that $1.2 billion, 700 miles, would-be-built-by-immigrants, Border Wall really need to go up?

Got a rebuttal? Email the editor! noel@brownscapeprod.com

http://www.reason.org/commentaries/dalmia_20060501.shtml

http://www.msnbc.msn.com/id/15240665/site/newsweek/page/2/

http://au.answers.yahoo.com/question/index.php?qid=20070724111004AAVedi0