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August 20, 2004

Salsa and Apple Pie

An American-Mexican Union in the Making

By Steven Hill

Immigration issues are always ripe for demagoguery, particularly in a presidential election year. Yet rarely do the bumper sticker slogans match the complex reality along the U.S.-Mexican border.

That reality is being driven fast by surging population demographics. A new report from the U.S. Census Bureau predicts that the number of Latinos and Asians will triple in the United States, and by 2050 whites will comprise only 50 percent of the nation’s population. Latinos are by far the fastest-growing population. By 2050 most of the U.S. will look like California today. And California will look more like… Mexico.

For some people, these changes are alarming. We can expect to see a new crop of demagogues calling for closing and militarizing the border. But economic disparities guarantee that poor Mexicans will continue seeking entry into El Norte, legally or illegally.

If we can’t shut out Mexicans seeking a better life, and we can’t just throw open the border, what else can we do? There is a third way that holds great promise: gradual integration of the two political economies. That process already has begun, but it has been resisted and resulted in the wrong regulatory scheme — the North American Free Trade Agreement (NAFTA).

For an idea of how this integration can proceed better, look toward the European Union. In May 2004, the 15 nations of the E.U. integrated 10 new nations, becoming the largest advanced political economy in the world, a powerful free-trading bloc of 450 million people. Yet the 10 new nations are poorer than the other 15 — just like Mexico is poorer than the United States.

European Union leaders wisely created policies for fostering regional integration that make American efforts like NAFTA look timid. They realized they had to prevent a “giant sucking sound” of businesses and jobs relocating from the wealthier to the poorer nations. They also had to foster economic growth and the spread of a middle class in these emerging economies, and prevent a mass exodus of poor workers to the developed nations.

So they gave the new member states massive subsidies — billions of dollars worth — to help with the construction of schools, roads, telecommunications, and housing, making these nations more attractive for business investment. The idea is to raise up the emerging economies, rather than drag down the advanced economies. It will be expensive, but the result will be a larger economic union where a rising tide floats all boats.

In return, the 10 poorer nations must agree to raise their standards on the environment, labor laws, health, and safety, so that predatory corporations looking to exploit cheap labor and deregulation won’t find that by relocating. There won’t be any border maquiladoras in the European Union.

But Europe’s union is not just an economic one — it also includes continent-wide political institutions, including a European Parliament and an executive commission where all 25 nations are represented.

The European Union signals the direction that border policy between the U.S. and Mexico needs to go. At some point it will make sense to move the North American regional integration out of the realm of a shadow economy and flawed free trade agreement. But what might such an American-Mexican Union look like?

It would start with massive subsidies from the U.S. to Mexico, with the goal of decreasing disparities on the Mexican side of the border and fostering a climate riper for investment. This would create more jobs in Mexico, and foster a growing middle class, complete with homeownership, schools, roads, and health care. A larger middle class would result in fewer Mexicans desiring to emigrate north, and create more consumers buying American products. The rising tide would float all boats, a kind of Marshall Plan for Mexico. But here’s an even more intriguing possibility.

We always assume that if we open the border, hordes of Mexicans will stream into the U.S. But under this scenario, we would see something new and different — Americans would begin emigrating to Mexico. Los Angeles, Phoenix, and Houston are all closer to Mexico City than to New York City or Washington, D.C. The cost of housing is cheaper in Mexico, and so is the cost of living. All things being closer to equal, many American workers will relocate to Mexico in search of jobs and homeownership, even to start businesses. They would chase the American Dream… in Mexico.

By 2050 not only will the rest of the United States look like California today, and California look more like Mexico, but Mexico will look more like the U.S. Already we see the beginnings of this, with American expatriate communities springing up around places like Guadalajara.

This kind of regional integration is the future for the United States and Mexico. It is happening already. And as that process unfolds, regional political structures will make more sense, perhaps including an American-Mexican parliamentary body. Canada, not wishing to be left out, will ask for inclusion.

Of course George Bush and John Kerry will not talk about these issues, since their pollsters tell them to avoid anything controversial. Expect American politicians to stick to bumper sticker slogans and avoid the reality of border issues until they are overtaken by the surging tide. But that day is looming closer with each passing election. 

Steven Hill is senior analyst for Center for Voting and Democracy (www.fairvote.org) in San Francisco, California and author of “Fixing Elections: The Failure of America’s Winner Take All Politics” (www.FixingElections.com).