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Shared Border, Shared Future: A Blueprint for Regulating US-Mexico Labor Mobility
What is the challenge?
The last bilateral cooperation to regulate flows between the United States and Mexico ended in 1964. Since then, unauthorized migration has dramatically increased. Of Mexican-born individuals who arrived in the United States after 1990, 80 percent did not have legal authorization at the time they arrived.
The black market for labor has brought harm on both sides of the border. For the United States, which hosts approximately five million Mexican workers without legal status, the black market can reduce wages and erode working conditions for all workers in many sectors of the economy, because unauthorized workers receive little protection from labor laws and thus tend to bid down wages and working conditions. This reduces income tax revenue, hinders law enforcement, and raises the cost of healthcare—as people without legal status often recur to emergency rooms—among other harms. Unauthorized migrants from Mexico who overcome greater barriers to enter the United States remain there longer. For this reason, even well-intended surges of enforcement effort can perversely increase the stock of migrants in the United States who entered unlawfully, as well as funneling greater smuggling revenue to organized criminals,[i] increasing document fraud, and raising deaths at the border. The black market furthermore represents an important threat to the security of the United States, since it thrives on secrecy and anonymity for massive numbers of people entering and leaving the country.
For Mexico, the black market has brought frequent abuse and exploitation of its citizens, created large income streams for violent organized criminals, contributed to corruption of local officials, and tarnished the country’s global image. Most horribly, it has brought death: from 1998 to 2014, US Customs and Border Protection collected an average of 372 bodies each year in the Desert Southwest. Over time, the black market has eroded support for cooperation between two neighbors that need each other. The Shared Border, Shared Future working group sees the black market for labor, and its consequences, as a result of policy failures and a lack of bilateral cooperation. Thus, this working group was convened to assess a reasonable and rationale blueprint for a path forward for both countries.
What is a possible solution?
The Shared Border, Shared Future working group explored ways in which the two governments could achieve this bilateral cooperation objective with an agreement that addresses fee systems, visa portability, incentives for worker training, return, and integration, and more. The resulting report and model ‘term sheet’ provide an overview of what a bilateral agreement, regulating temporary and employment-based migration, could look like. To guide this work, the group operated under five principles about the shared future and shared responsibility of both countries:
Temporary mobility between Mexican and US territory is older than either country, and requires regulations tailored to that shared history and destiny.
Labor mobility between the two countries can bring shared economic benefits
Most recent labor mobility has been unlawful, which has harmed workers and national security in both countries.
Despite the rising importance of other countries, cross-border flows of Mexican labor will continue.
History teaches that flexible regulation and bilateral cooperation are the only lasting solution, but the flaws of past agreements show that proper design is a necessary ingredient.
How did the group operate?
The Center for Global Development (CGD) convened this working group from May 2015 – September 2016. Conceived by CGD Senior Fellow Michael Clemens, the working group was created to address a 50-year lapse in bilateral cooperation. The last cooperation on labor migration between the United States in Mexico ended in 1965, and since then unlawful migration from Mexico to the United States has dramatically increased. To help address this challenge, CGD brought together experts with a diverse array of expertise in business, economics, law, labor, policy, national security, and more. Together, the working group charted a rational, rigorous, and reasonable blueprint that could benefit both countries and their citizens.
The group held two plenary meetings, one at CGD in Washington, DC on May 13, 2015, and a second in Mexico City on October 9, 2015. In addition, the working group convened a US subgroup and Mexico subgroup. Each held individual meetings prior to the October Mexico City meeting to discuss issues of specific importance to each country’s leaders, laws, regulations, etc. The CGD Secretariat complemented these meetings through individual consultations with influential thought leaders in the fields of immigration and bilateral cooperation. These combined efforts have resulted in this working group report, and we are extremely grateful for the time and commitment of all involved.
Members were invited to participate in a strictly personal and volunteer capacity, not as representatives of their employers or organizations. The co-chairs and members have endorsed the report, though not all necessary agree with every statement and recommendation.
Who were the group members?
Working Group Co-Chairs
Carlos Gutierrez, Albright Stonebridge Group, and Ernesto Zedillo, Yale University
Working Group Members
Edward Alden, Council on Foreign Relations
Daniel Chiquiar, Bank of Mexico
Luís Ernesto Derbez, University of the Americas, Puebla
Gerardo Esquivel, The College of Mexico
Tony Fratto, Hamilton Place Strategies
Katie Hays, Caterpillar Inc.
Tamar Jacoby, ImmigrationWorks USA
Lynnette Jacquez, C. J. Lake LLC
Eliseo Medina, Service Employees International Union
Doris Meissner, Migration Policy Institute
Gustavo Mohar, Groupo Atalaya
Alejandro Poiré, Tecnológico de Monterrey
Craig Regelbrugge, AmericanHort
Silvestre Reyes, former chair of the House Permanent Select Committee on Intelligence
Arturo Sarukhan, CMM
Joel Trachtman, The Fletcher School at Tufts University
Rebeca Vargas, US-Mexico Foundation
Michael Clemens, Center for Global Development and IZA Institute for the Study of Labor
Hannah Postel, Center for Global Development
Cynthia Rathinasamy, Center for Global Development
[i] Gathmann, “Effects of Enforcement on Illegal Markets.”
From the article:
“It is a difficult political lift, but we’ve tried other ways for half a century,” said Michael Clemens of the Center for Global Development, the chief writer of the “Blueprint.” Barring legal immigrant workers will not protect American workers. But it will ensure that illegal immigration persists.
Read the full article here.
How can we create an immigration policy that works? That's the subject of a new CGD report called "Shared Border, Shared Future." Former Mexican president and CGD working group co-chair Ernesto Zedillo joins this week's podcast to discuss the need for a cooperative solutions to unlawful migration.
“Policies have given rise to a black market in the labor force and that has been bad for American workers and bad for Mexican workers that tried to migrate to the US seeking better opportunities.”
With his fellow co-chair former US Secretary of Commerce Carlos Gutierrez, President Zedillo co-authored a recent op-ed in the New York Times (also here in Spanish) that argues “there is a better way. We believe both countries must now arrive at a lasting, innovative and cooperative solution.”
In this edition of the CGD podcast, President Zedillo explains how the new CGD report, whose lead author is CGD’s migration expert Michael Clemens, addresses in detail the root cause of the problems and the politics we see today: namely, the illegality of much migration between Mexico and the US. It takes as its starting point what it describes as the "black market in labor" that has grown in the US in the last half century, ever since the last agreement on regulated, legal labor mobility between the two countries ended.
“It would be better,” says President Zedillo, “to have a regulated, well-managed way for bringing those workers to provide the necessary labor force in a way that you don’t damage American workers and also you don’t allow the very negative aspects of undocumented migration.”
Protecting workers in both countries is a key foundation of Shared Border, Shared Future, which also underscores the critical need to clamp down on illegal cross-border movement of people. The time is right for such an agreement, the report argues, because net flows of people between Mexico and the US are approaching zero.
The report is the product of an illustrious bilateral, bipartisan group of experts from across the political, geographical and sectoral divides: from the highest levels of government in both Mexico and the US to labor advocates, employers' groups, national security experts, and scholars in law, economics and politics.
As always I encourage you to comment on the podcast, and share widely!
Today we launch a detailed proposal for a new era of collaboration between the United States and Mexico: bilateral regulation of temporary, lawful labor mobility across the border. I join with a diverse, five-star group of experts from both countries—chaired by Ernesto Zedillo, the former president of Mexico and Carlos Gutierrez, the US Secretary of Commerce under George W. Bush (as featured in the New York Times)—to say that it is time for a new vision of the shared future at our shared border. We offer specific ways to get there.
The movement of workers between the US and Mexico has been dominated by illegality for most of my life. Nobody in either country wanted this. The black market has killed many thousands of people. It has strained the resources of state and local governments. It has made families on both sides of the border deeply and justifiably frustrated with their elected officials. The creation of that black market was a historic tragedy. It was also unnecessary, and it is time for it to end.
We can do better—now, today. I worked with President Zedillo and Secretary Gutierrez to ask a diverse group of leaders precisely how the two countries could do better. This Working Group includes people from both sides of the political divide, in the US and in Mexico, with expertise in law enforcement, organized labor, business, economics, and the legal code of both countries. It includes a former head of US immigration enforcement, a former director of Mexico’s national security intelligence agency, and a former sector chief of the US Border Patrol. They come from left and right, north and south, labor and capital, theory and practice, public sector and private sector. Their objective was to find solutions that protect workers on both sides of the border and that benefit both countries.
A Shared Destiny
The United States and Mexico are neighbors with an inseparable shared geography, history, and economy. Few Americans realize that Mexican workers have built up the US economy alongside US workers since the time of our grandparents and great-grandparents: In many states like Kansas, Arizona, and Texas, the Mexican-born fraction of the labor force was much higher in 1930 than it was in 1990. Most were driven out during the Great Depression, their hard work largely forgotten.
Today, anyone in the US who has walked into newly-built homes or eaten cucumbers and melons is almost certain to have directly benefited from Mexicans’ hard work at some point. Mexican workers have quadrupled their productivity and earning power by working across the border, raising productivity all over the region and thus—my research has found—creating jobs for US workers. The skills and money they brought home to Mexico, both today and in the past, have raised productivity in the second-largest market for US exports. And many indirect benefits go unnoticed: Mexicans who arrived in the US for low-skill work have produced the likes of a leading neurosurgeon and an astronaut. Like a small number of US natives, a small number of Mexican immigrants commit crimes—but at much lower rates than US natives.
The two countries could have gained greatly by cooperating to shape these historic forces for mutual benefit. Instead they let their last agreement to jointly regulate labor flows expire at the end of 1964. What quickly followed was the largest wave of black-market labor mobility anywhere, ever, driven by vast economic and demographic forces.
In the half century since, again and again, a generation of advocates has dismissed any serious proposal to build and enforce a well-regulated labor market between these neighboring countries. The colossal black market and its many harms deserve to be seen largely as a consequence of that generation’s failed experiment in rigid, unilateral policy. Ronald Reagan’s immigration reform of 1986 focused on the status of people already in the United States, not the pragmatic regulation of new labor mobility—a critical flaw that soon made the reform futile. Just four years after what was billed as a once-and-for-all solution, there were more unauthorized workers in the US than before the reform.
What our Working Group has done is to set out a way forward that avoids the mistakes of the past. Far beyond stating principles, they have designed several policy tools that an effective agreement must include. Their proposal for cooperative regulation will remain the definitive one for a long time.
The group is quite aware of the profound flaws in the two countries’ prior efforts to cooperatively regulate labor mobility, the bracero agreements of 1942–1964, under which abuses of workers’ rights was much too frequent. Indeed, the group includes the son of a bracero worker. But the flaws in those agreements arose primarily from their poor design—and the disastrous effects of ceasing all cooperative regulation have been much worse. The group has proposed a series of mold-breaking innovations to design cooperative regulation of labor mobility for the 21st century.
New Tools for the Job
President Zedillo and Secretary Gutierrez, in their op-ed in the New York Times (Spanish version here), highlighted some of their proposed innovations:
These include a system of fees to ensure that it is in American employers’ interest to hire American workers first; a form of visa portability among employers that would protect the rights of both Mexican and United States workers; a safeguard cap to prevent unforeseen spikes in the number of workers crossing the border; and new incentives for worker training, return migration, and integration. It furthermore proposes a bilateral, comprehensive system to regulate the recruiters of Mexican labor—for the first time in a half-century—in order to uphold workers’ rights and the laws of both countries.
That is just a sample. Their many other innovations include proposing the creation of a much-needed Bilateral Labor Markets Commission, an independent source of technical advice on how to adjust regulation of US-Mexico labor mobility for the mutual benefit of workers and employers in both countries. The US has had such an agency to advise its regulation of international trade, the International Trade Commission, for a hundred years. It has nothing of the kind to guide the regulation of international labor movement.
I’m delighted to have been the lead author of the report on the Working Group’s findings, available in English and Spanish at www.cgdev.org/sharedfuture. The political rancor of this year has been a stark reminder of how fed up people are with the failed policies of the past 50 years, as well as a reminder of the counterproductive proposals that arise in the absence of a serious alternative. This group’s ideas are that alternative, and they are as serious as it gets. Have a look at their proposal and think through your own vision of two neighbors’ shared future.
From the article:
Estados Unidos y México comparten una rica historia. Durante más de un siglo, la gente ha ido y venido a través de la frontera para trabajar. Su trabajo arduo y dedicación podrían haber tenido lugar dentro de un mercado laboral bien regulado y ventajoso para ambos países. Sin embargo, en años recientes la mayor parte de la mano de obra se ha movido en un vasto mercado negro, afectando a los trabajadores, las familias, la seguridad y las finanzas públicas en ambos países.
Read the full article here.
From the article:
The United States and Mexico have a rich, shared history. For more than a century, people have moved back and forth at the border to work. Their toil and industry could have taken place within a well-regulated and mutually beneficial labor market. But in recent years much of their labor has occurred in a vast black market — harming workers, families, security and public finances in both countries.
Read the full article here.
Mexico and the United States have lacked a bilateral agreement to regulate cross-border labor mobility since 1965. Since that time, unlawful migration from Mexico to the US has exploded. To address this challenge, CGD assembled a group of leaders from both countries and with diverse political affiliations—from backgrounds in national security, labor unions, law, economics, business, and diplomacy—to recommend how to move forward. The result is a new blueprint for a bilateral agreement that is designed to end unlawful migration, promote the interests of US and Mexican workers, and uphold the rule of law.
The U.S. economy has long relied on immigrant workers, many of them unauthorized, yet estimates of the inflow of unauthorized workers and the determinants of that inflow are hard to come by. This paper provides estimates of the number of newly arriving unauthorized workers from Mexico, the principal source of unauthorized immigrants to the United States, and examines how the inflow is related to U.S. and Mexico economic conditions. Our estimates suggest that annual inflows of unauthorized workers averaged about 170,000 during 1996-2014 but were much higher before the economic downturn that began in 2007. Labor market conditions in the U.S. and Mexico play key roles in this migrant flow. The models estimated here predict that annual unauthorized inflows from Mexico will be about 100,000 in the future if recent economic conditions persist, and higher if the U.S. economy booms or the Mexican economy weakens.
Mexico and the United States have lacked a bilateral agreement to regulate cross-border labor mobility since 1965. Since that time, unlawful migration from Mexico to the U.S. has exploded. Almost half of the 11.7 million Mexican-born individuals living in the U.S. do not have legal authorization. This vast black market in labor has harmed both countries. These two neighboring countries, with an indisputably shared destiny, can come together to work out a better way.