Market Mad House

In individuals, insanity is rare; but in groups, parties, nations and epochs, it is the rule. Friedrich Nietzsche


Is Basic Income the Solution to Illegal Immigration?

The best solution for the illegal immigration crisis at the Southern Border might be for Uncle Sam to disperse cash directly to the people of Central America. A basic income paid directly to or underwritten by the United States might alleviate the flood of migrants.

The major cause of the migrant crisis is poverty in Central America. The average income in El Salvador; one of the main sources of illegal immigrants, was $8,900 in 2017 according to the CIA’s World Fact Book. That was actually higher than the average income in Guatemala which was $8,200 in 2017.

With numbers like that it is easy to see why vast numbers of Central Americans set out for the United States; where the average income household income was estimated at around $57,230 to $59,039 a year. The poverty in Central America guarantees the flood of migrants will continue for the foreseeable future.

 Is Basic Income the Solution?

This leaves the United States with two very bad options; either place machine guns and mine fields at the border, or engage in economic development in Central America.

Since a death zone at the border is out of the question economic development is the answer. The problem with that is that we know traditional foreign aid paid directly to governments does not work, most of the money ends up in El Presidente’s bank account.

Good works like the Peace Corps; are a little more cost effective, but practically less effective than foreign aid. At least some of the foreign aid money reaches the local poor in the form of tips, or jobs as servants to corrupt officials. Peace Corps projects usually end up abandoned and neglected after the Peace Corps worker returns to his middle class life in the USA.

Fortunately, modern in technology in the form of smartphones provides a solution. Cash can be dispersed directly to poor people via smartphone apps similar to Venmo or Apple Pay. That technology can be used to provide a basic income to Central America’s poor.

Such a system has been successfully tested in Kenya for over 12 years by a charity called GiveDirectly. GiveDirectly disperses sums of cash straight to the poor via the M-Pesa payment app. Almost every smartphone user in Kenya uses the M-Pesa app instead of cash for many transactions.

Studies of GiveDirectly showed that its recipients had better mental health, Business Insider reported. Recipients were also more content, which might encourage them to stay. The GiveDirectly experiment is small scale; just 16,000 people are participating, but it points to a potential solution for the mess in Central America.

Would Basic Income be Cheaper than Border Security?

A basic income for Central America might be cheaper than detaining and deporting illegal immigrants. It would also be cheaper than Border Security measures like President Trump’s Wall.

It U.S. taxpayers $10,854 to deport an illegal immigrant in 2016, CNN Money reported. Immigration and Customers Enforcement (ICE) spent $3.2 billion identifying, arresting, detaining, and removing illegal immigrants in 2016 – before President Trump’s crackdown.

These figures do not cover the cost of President Donald J. Trump’s (R-New York) ridiculous border wall. The official cost of the Wall has been projected at $21.6 billion but some opponents have estimated the price at $66.9 billion, Time reported. Even without the Wall, the United States has spent $263 billion on border security since 1986, The American Immigration Council estimated.

Given figures like that some sort of basic income; say $100 or $500 per person per month, for Central Americans might be cheaper than border security. Something has to be done because the current border situation is unsustainable.

Would Basic Income help Central America?

A basic income would encourage economic growth by dispersing the funds to average people who would spend the money. An advantage to basic income is that average people would spend the money on food, housing, and consumer goods products that drive economic growth.

More economic growth would mean more jobs which would encourage more Central Americans to stay home. Increased economic growth would create more opportunities to start businesses and more taxes which would mean more activity. That too would generate additional jobs.

A basic income would certainly be more humane than deportation. Done properly, a basic income might kick start the Central American economies. History shows that the only way to stop mass immigration from a nation is to give it a higher standard of living. There is no more mass immigration from Europe and Japan to the United States because of the prosperity in those regions.

Basic Income for Border Security

Basic income might also alleviate some of the other causes of immigration such as crime and gang violence. People join gangs and commit crimes because they are poor and desperate. For many young men in Central America the gang is the only “job” in town.

Beyond that a basic income for Central America would be an offensive measure while border security is defensive. The old saying “the best defense is a good offense” is a true one.

Defensive measures, always fail in the long run because they ignore the underlying causes. We need to start dealing with the real cause of the migrant crisis; which is Central American poverty, if we want a truly secure border.

Basic Income and Immigration Threaten Sovereignty

There is another potential objection to a basic income that must be addressed here and that is sovereignty. Direct payments from the US government to citizens of other countries would undermine those nations’ sovereignty.

Since sovereignty is already being eroded by migration, that objection is questionable. The Central American nations’ sovereignty is already being undermined by mass emigration. The mass illegal immigration into the United States is also eroding American sovereignty.

Historically, the United States has often violated the sovereignty of Central American nations. Currently, Uncle Sam is paying for police forces in those countries, so sovereignty is a dead issue. The question is not should we violate sovereignty but how should we do so.

An obvious way to preserve “sovereignty” (or the illusion of it) would be to have the basic income dispersed by a private charity like GiveDireclty or; or the Bill and Melinda Gates Foundation, or a religious entity like the Roman Catholic Church. That system would not be perfect but it might depoliticize the payments.

Americans that oppose illegal immigration might put their money behind their beliefs by donating some of their own cash to a basic income scheme perhaps one operated by Give Directly. Wealthy Americans opposed to immigration would do their cause more good by redirecting their donations from campaign donations to politicians like Donald J. Trump to basic income for Central America.

One thing is certain more investment in border security will not end the migrant crisis. It is time to start exploring creative solutions like the Basic Income before the crisis spirals out of control.