Mr. Trump Proposes His Dream Wall.

by Pitt Griffin on April 6, 2016 · 0 comments

in Election 2016, Immigration, Politics

“The demagogue is one who preaches doctrines he knows to be untrue to men he knows to be idiots.” ― H.L. Mencken

On the first day of his campaign, Donald Trump – self-described non-politician – promised to build a border wall and get Mexico to pay for it. It has become a mantra. His fans love the idea. And as they say, love is blind. None of them showed interest in the grubby details of how he would do it. But those not so enamored of the marmalade fat-cat did not issue Trump a free pass.

At last, the great man explained his reasoning. He would use anti-terrorism laws to seize the money wired to Mexico by undocumented workers – unless Mexico ponied up a payment of $5-10 billion for the wall.

photo“There it is,” intoned the chorus. Elegant, simple and punitive. But the skeptics were not so easily persuaded. In summary, they replied, “It won’t work, and here’s why.”

The proposed law only applies to so-called “illegals”. How would you enforce it? Will the government shanghai Western Union into service as an immigration agent? What if it resisted? Could it be pressed into service? It makes money on wire transfers, what possible reason would it have to voluntarily enforce the law?

Let’s say the Trump administration created a mechanism that put a stop to these transfers. His plan calls for the money to be confiscated. Undocumented aliens aren’t stupid. They wouldn’t attempt to send money in person. They would find qualified people to send the money. And if, for some reason, they couldn’t, the stores that make the transfers would find a way.

Let’s imagine that the government did figure out how to shut down the cash flow – what effect would it have? For better or worse the money remitted to Mexico is significant to their economy. In 2015, Mexicans in the US sent $24 billion back home. Take that out of the Mexican economy and more Mexicans would head North. Like so many plans  – say the war on drugs – that look so practicable on paper, it would have an effect anathema to its original intent

Another classic example of the law of unintended consequences.

Another Trump scheme for a Mexican-paid-for wall is rooted in America’s $54 billion trade deficit with Mexico. He seems to believe the deficit means the Mexican government has a large pile of money sitting in a vault somewhere. Economists had a good laugh at that – until they realised he was serious.

Trade is engaged in mostly by private business. Statistics, like a national trade deficit, are only a means of keeping score. What funds the Mexican government has come from taxes. And they can’t afford to maintain their own infrastructure – let alone build ours.

Trump has also mentioned higher fees on visas. But if the elasticity of demand for visas is greater than one, the total revenue from visas will go down – as any Economics 101 student knows. And fewer visitors to the US will result in fewer tourist dollars.

It’s all a game anyway. There is little point in figuring out how to pay for something until you can estimate its cost accurately. Trump has thrown out a figure of $8 billion. He’s a salesman, so you know it’s a lowball estimate. Engineers come in closer to $25 billion. Let’s allow Trump his ‘business acumen’ argument and not add on the usual government cost overrun calculation. Regardless, the construction number doesn’t include the maintenance costs.

Trump has based his sleight-of-hand estimate on Israel’s border barrier costs. Ignoring the fact that 90% of that wall is a 6-foot high electronic fence.

What we have is a government project, promoted by a huckster, where the costs are underestimated, the funding is unsecured – and which will ultimately be paid for by the taxpayer. Damn, the man is a politician to his wing-tips.

 

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