Mexico’s Future

At the Center for Strategic & International Studies Richard Miles underscores what I’ve been saying for some time and summarizes it succinctly in his opening paragraph:

Lower birth rates and freer markets have led to a sustained drop in Mexicans moving north to find work, developments that will reshape the immigration debate in the United States. Meanwhile, the passage of the North American Free Trade Agreement (NAFTA) in 1994, combined with Mexico’s entry the same year into the Organization for Economic Cooperation and Development (OECD) has transformed its economy and slowly made its citizens better off. By 2055, Mexico will be smaller, wealthier, and with citizens less prone to leave their country. These fundamental trends may be thwarted by changes of government policies in the United States and Mexico, but they are unlikely to stop for the remainder of the twenty-first century.

and the graph at the top of the page illustrates the demographic forces that will promote those changes. It also explains why I’m not particularly worried about Mexican immigration.

I am, however, concerned about the rule of law and business models that assume a continuing supply of low-level workers. The studies most cited to demonstrate that Mexicans-Americans do eventually assimilate also found that assimilation is taking much longer than previous cohorts of immigrants.

The next cohort of immigrants will present new and more difficult problems. Look to the Somalis for a vision of things to come. As a community their unemployment rate is still a multiple of the general unemployment rate. Compare that with the unemployment rate of the Mexican immigrants. There are costs that are not worth bearing just so that somebody can say “Do you want fries with that?” in strongly accented English.

One factor not mentioned in the piece: when a significant fraction of the emigrants are women of child-bearing age, it tends to depress the birth rate. Expect Mexico to want to keep its young people at home in the coming years.

3 comments… add one
  • TastyBits Link

    So, it takes over 50 years of free-trading with a country before those workers no longer put Americans out of work, but it will take another 50 years for the replacement country to stabilize.

    If my calculations are correct, Americans will have job security in 500 years assuming that no other country back-slides.

    […] Look to the Somalis for a vision of things to come. […]

    When I was there (1992-93), the men stood around all day chewing khat while the women and little girls (8 years old) were carrying sticks to Mogadishu and returning with water. I suspect that some of the little girls could carry a pack on their head and out-hump a Marine.

    The Somali men were even more worthless than Iraqi men.

  • Andy Link

    I think the projections are way too optimistic and based on questionable assumptions. Mexico still has a ton of problems which put its future progress in doubt.

  • The demographics is not in question. There won’t be any more 20 year old Mexicans in 2020 than were born in 2000. That’s going to govern what happens in Mexico as a country.

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