Tuesday, September 05, 2006

Mexican Immigration Stablizes US-Mexico Oil Trade?

A conspiratorial-minded writer speculates on oil's influence in the immigration debate:
Mexico has the third-largest proven reservoirs of crude oil in the Western Hemisphere -- behind Venezuela (dominated by the America-hating pro-communist Hugo Chavez) and the United States. Any crackdown on illegal immigrants, according to authors Smith and Corsi, "would have an immediate [negative] impact on Mexico."

Illegal immigrants send about $17 billion a year back home to families in Mexico. The result: "As a hedge against instability in the Middle East, the U.S. government has to calculate our oil needs when considering any steps we take regarding Mexico or illegal immigrants." What if one of the Middle East cutthroats or a so-called "ally" over there cuts off its exports of oil to us when the chips are down? That is the frightening story behind government inaction on illegal immigration. It dwarfs the other considerations (i.e. cheap labor and future voters). The oil factor is conspicuous by its absence in the public dialogue over our porous borders. (Mexico's threatened instability and/or insurrection following its recent presidential election adds even more urgency to the problem.)
Wes Vernon

I think this is a misinterpretation. Obviously, Mexican oil sold elsewhere will only result in somebody else's oil getting sold to us. Short of complete industry shutdown, the oil supply would remain a constant.

It's oil demand that's the most variable. If a sealed border doesn't cause self-destructive political instability, Mexicans who would have emigrated could force reform. Increased local consumption of Mexico's natural resources would weaken oil exports in the short term. Under the current system, both Mexican people and Mexican oil go to the US where we make a pretty penny off of both. A reformed Mexico would mean that wealth and labor stays unsiphoned.

With a reformed Mexico US oil interests could take a direct hit, even though Mexico would benefit. I suspect even with pricier oil Americans would also benefit from a healthier Mexico in the long term. However, with modernizing China and India already driving up the price of oil, keeping prices down might mean keeping Mexico down.

If this writer is half-right about oil's influence on immigration, somebody needs to connect these dots.

No comments: