If Americans have misgivings this week about President Bush's plan to extend workers' rights to illegal immigrants from Mexico, they should look to the future, when many more migrant laborers will no doubt begin flowing across the border.
That's because the root cause of illegal immigration is the lack of employment opportunities in Mexico's poor economy. And that economy is getting worse, not better.
"We are in the fourth year of employment decline," says Mexico City-based economist Rogelio Ramirez de la O. The country needs to create 800,000 jobs a year just to keep up with new entrants to the labor force. Instead it has lost 1.2 million jobs in the last three years.
Financial experts in Mexico and the U.S. describe the economy as "bogged down" and its outlook as "horrendous." President Vicente Fox has failed to win the tax reforms that would give the Mexican government the funds it needs for education -- the key to its prosperity over the long haul. Meanwhile, he also has failed to put in place many of the structural changes that would propel Mexico's economy to grow faster.
On Monday, Fox welcomed the White House's immigration plan at the Summit of the Americas in Monterrey, hailing the fact that the "labor rights and worker rights" of an estimated 3.5 million illegal Mexican migrants working in the U.S. "will be protected."
But a U.S. guest-worker program isn't the real answer. As Ramirez so rightfully points out: "Mexico cannot continue to pass on our responsibility for job creation to another government."
Some statistics suggest that Mexico's economy is on the mend. Government debt has been reduced. Inflation is under control at 3.8%. The peso has been relatively solid, now at 11 pesos to the dollar. And the Mexican stock exchange has performed well.
Yet both U.S. and Mexican financial experts see flaws behind the figures. For one thing, the central government is engaging in off-balance-sheet borrowing by having government-controlled companies float bond issues -- a kind of debt that doesn't show up on Mexico City's books, notes Walter Molano, a partner in BCP Securities, a Greenwich, Conn., investment bank specializing in Latin American issues.
John Rhoads, the U.S.-born founder of a Mexican brokerage firm, says that the stock market also does not accurately reflect the misery on the streets.
