Regardless of how you feel about immigrants entering our country across the southern border at the Rio Grande River—whether you wish to restrict immigration completely or partially, or whether you believe in open, unlimited immigration either temporarily or permanently—we can all agree that the current situation there is awful and, at times, tragic.
The sheer volume of people desperately trying to gain entry into the United States has produced chaos. This human flood is overwhelming the infrastructure and personnel designed to maintain an orderly and legal process of immigration.
While opinions differ widely and vehemently about what our federal government’s policy should be toward the masses of wannabe immigrants, both sides recognize that no long-term solution can be achieved without addressing the root cause of the problem.
On the Republican side, former Secretary of State George Shultz addressed the root cause in The Wall Street Journal. Shultz reported (accurately, I believe) that life has become so wretched, unsafe, and hopeless in the Northern Triangle of Central America (Guatemala, Honduras, and El Salvador) that people are willing to risk their lives to get to their version of “the promised land”—i.e., the United States. On the Democratic side, the oft-quoted first-term Rep. Ilhan Omar (D-Minn.) acknowledges that this human flood represents “a refugee crisis fueled by state violence, corruption, and impunity …” in their native countries.
What’s more astonishing than the agreement across the partisan divide about the root cause of the crisis is that Shultz and Omar agree at least partially on the solution. Shultz wants to “pour U.S. foreign aid into improving” the Central American countries; Omar blames the Trump administration for “slashing aid” to the region.
Shultz and Omar want to increase aid first and hope that it reduces immigration later. By contrast, President Donald Trump is withholding foreign aid now (delaying the disbursement of $183 million of aid) in order to incentivize those countries’ governments to take active measures to curb emigration from their countries in the present rather than the future.
No matter how the domestic political battle over immigration policy plays out, the notion that an increase in foreign aid will fix the Northern Triangle is problematic. While I respect and commend Shultz’s sincere desire to help the long-suffering people of Guatemala, Honduras, and El Salvador, his assertion that foreign aid can “fund better policing … root out corruption and encourage political reform” is naive and ahistorical.
Foreign Aid Doesn’t Work
The World Bank, which has probably dispensed more foreign aid than any other entity in the world, has published studies documenting the sorry record of foreign aid. Far from ending corruption, foreign aid often encourages and entrenches it. Clever opportunists in poor countries cynically present themselves as selfless reformers.
Then, with the vast sums of money entrusted to them by the foreign aid establishment, the recipients use it to enrich their political allies and consolidate their power.
Foreign aid has a long track record of subsidizing and prolonging the bad governance that’s the very cause of the underdevelopment and suffering that victimizes the populations of recipient countries.
I’m not saying that Americans and people from other rich countries can’t help. Private initiatives in health care and education can help considerably and are always welcome. And I certainly don’t oppose emergency government aid for humanitarian rescues. But when it comes to economic development—the kind of long-term growth that enables a country to grow and prosper—foreign aid doesn’t cut it.
Look at the developed countries around the world today, and you’ll be hard-pressed to find a single one that became wealthy due to foreign aid it received. (Don’t say, “the Marshall Plan.” In the first place, those already were developed countries. In the second, that aid made it easier for the governments of the UK and France to set up welfare states that ended up sapping their growth and causing their economies to lag behind the vigorous growth of the defeated powers, Germany and Japan, that didn’t receive such generous aid.)
Can foreigners help a country develop? Absolutely. Both foreign trade and foreign investment have turbocharged economic growth in formerly undeveloped countries. Foreign investment, not foreign aid, will someday help to finance infrastructure and create job opportunities for Guatemalans, Salvadorans, and Hondurans. And increased foreign trade with those countries will integrate their people into the global division of labor and increase their income.
The key question in regard to boosting economic development in the Northern Triangle is, how can foreign businesses and investors be persuaded to deal with those countries? The answer lies within. Once those countries show respect for property rights, contracts, and the rule of law, profit-seeking entrepreneurs will deploy capital and resources.
In other words, their fate is in their own hands. We in the United States can’t purchase good governance and higher standards of living for those countries. It’s up to those countries to work out their own salvation by changing course and adopting the values of civilization. If they do, they’ll prosper. If they don’t, then those nation-states may fail and their territories will lapse into primitive tribalism.
Our government can supply guidance, encouragement, and support of right endeavors, but it’s up to the people in those countries to choose to emulate what has successfully elevated so many other countries. We can’t do it for them. That’s an idea born of compassion, but it’s neither wise nor workable.
Mark Hendrickson, an economist, recently retired from the faculty of Grove City College, where he remains a fellow for economic and social policy at the Institute for Faith & Freedom.
Views expressed in this article are the opinions of the author and do not necessarily reflect the views of The Epoch Times.