Is the Grass Really Greener?



What does  the incredibly popular Ashley Madison web site (only three zip codes in all of America have no residents on the site) have in common with the Trans Pacific Trade Partnership?  I suggest it’s the age-old allure of distant pastures, the notion that the grass is greener beyond the horizon.

The people who decide such things have identified the Pacific Rim as America’s most lucrative future trading target. And they are challenging China to gain access to the billions of potential customers in the area. Apparently, these policy makers are even prepared to sacrifice America’s environment in the process. I understand that provisions of the trade agreement give international corporations the right to override national and local environmental protection laws.

You might argue that opening the vast Asian markets to American exports would be hugely beneficial to America’s economy. You might say that America has been smart to embrace China as a major economic partner since the days of Richard Nixon. But with American manufacturing all but lost and the American stock market shivering and shaking, don’t you have second thoughts today?

While America has salivated over the imagined riches of the Orient, the Chinese have made inroads into the Caribbean and Latin American markets on Uncle Sam’s doorstep. China, which has been busy building hotels and making other investments in Jamaica,  is now Brazil’s top trading partner, for example. And when plummeting oil prices left Venezuela in trouble, it was China that coughed up tens of billions of dollars in loans and investments to help the Venezuelans.

The Chinese have also provided loans and investment capital for Ecuador, Cuba, Brazil and other Latin American and Caribbean countries.

Meanwhile, America’s trade with Latin America – both exports and imports – has been dwindling. And, apart from NAFTA partner Mexico, US interest in investing in the region has experienced a dramatic decline from the old Monroe Doctrine days.

China’s interest in the region is not driven by charity but by hard-nosed business sense. They’re betting on a predicted Latin American rebirth in the wake of decades of political and economic crises.

According to the World Bank, GDP growth in Latin America and the Caribbean is expected to be 3.7 percent in 2016. Columbia is expected to be at or above 4 percent for the next several years. Brazil’s growth rate is expected to increase from 2.2 percent in 2013 to 3.7 percent in 2016.

The Chinese see Latin America as a potentially profitable trading partner, while Americans tend to regard the region with irrational contempt.

I suspect the political propaganda that’s bandied about in the US has a lot to do with it.

Politicians (such as Donald Trump) constantly focus on a supposed epidemic of illegal immigration, painting a picture of poverty-driven hordes swarming across the Mexican border and bringing a frightening crime wave with them.

This lurid picture is sheer fiction. Consider these facts:

  • Less that one percent of the world’s 100 million immigrants a year come to America.
  • Illegal immigration to the US has declined to its lowest level in at least two decades. 
  • Undocumented immigrants make up only one-tenth of one percent of the U.S. population and has dropped by about a million since 2007.
  • At least two-thirds of America’s immigrants enter the country legally.
  • Many immigrants bring valuable skills to America. (At least one third have college degrees.)
  • Crime rates are lowest in states with the highest immigration growth rates.
  • Immigrant communities are revitalizing dying neighborhoods in cities and older suburbs

The spectre  of an illegal immigration invasion, triggered by desperate conditions in the immigrants’ home countries, has bred an exaggerated image of poverty, ignorance and crime in the Caribbean and Latin America. And this image will persist as long as American politicians shamelessly use it in their demagoguery.

I suspect this distorted view of America’s neighbors is influencing its trade policies – to the detrimment of Americans and Latin Americans alike.

Click for more on Latin American prospects.

Click for the real immigration situation.