One of the many sideshows overshadowing serious national and international issues is over who will pay for the big beautiful wall along the southern border that President Trump has promised to build. The president says Mexico will. The Mexicans say they won’t.
Lost in the barrage of schoolyard taunts are several important matters. First, not only would the United States benefit from secure barriers along the border, but so too would many Mexicans. Second, taxing, or imposing fees on, remittances sent out of the country (not just to Mexico) is not an unreasonable proposition.
The lawless border between the two countries is not just a problem for the United States. Communities in Mexico are plagued by criminal cartels that engage in cross-border activities like smuggling of drugs and human beings. Interdicting rampant criminal activity along the border would loosen the grip of these violent syndicates on communities in northern Mexico, ending their reign of terror, and enabling honest and productive businesses to flourish.
From the standpoint of the United States, collecting fees on money transfers out of the country would not be entirely punitive. Remittances represent a very significant but often overlooked cost of mass immigration. According to the World Bank, $133.5 billion flowed out of the U.S. in 2015. In 2016, remittances to Mexico (mostly from the U.S.) hit an all-time high of $27 billion – exceeding that country’s revenues from oil exports.
This massive outflow of money harms local economies in the U.S. The $133.5 billion that was earned here and shipped elsewhere is money that is not recirculated through local economies, stimulating local economic growth and generating revenues for local governments. Moreover, many of those working here illegally are being paid under the table, so the money is not taxed when it is earned. It is not unreasonable, therefore, for the United States to consider recouping some of the cost of the fence by collecting fees or taxes on funds being transferred abroad.
Most importantly, regardless of who pays for the fence, both the United States and Mexico would benefit greatly from a secure shared border that is open to legitimate commerce and travel, but secured against illegal immigration and criminal activity.