Everything Trump Would Have to Do to Make Mexico Pay For the Wall

It’s possible that staunching the flow of money sent home to Mexico – remittances total more than $20 billion each year – would make Donald Trump’s plan to build a wall more likely.  But that could mean rewriting the Patriot Act, immigration law, financial regulations and international trade agreements.

By Rhonda FanningApril 6, 2016 1:10 pm| , ,

Build a wall and make Mexico pay for it.

It’s been the cornerstone of Donald Trump’s presidential campaign since the early days. But until this week, the candidate has never elaborated on just how he expects to make that happen. In a two-page memo to The Washington Post, Trump explains his plan: he says he’d stop the flow of money transfers to Mexico – like remittances immigrants send back home via Western Union and –  unless the Mexican government paid a one-time fee of $5 to 10 billion.

If you’re thinking Mexico could care less about remittances, you’re wrong. In January alone, Mexico took in were almost $2 billion from remittances. In February, nearly $2.1 billion. Last year, $24.8 billion. Moody’s Analytics says this money keeps hundreds of thousands of Mexicans from slipping into poverty. Mainstream politicians have long said the plan to get Mexico to pay for a wall is pure fantasy but The Atlantic magazine now says there’s “good reason to treat Trump’s plan to build a wall on Mexico’s dime as the opposite of fantasy.”

Manuel Orozco, senior fellow at the Inter-American Dialogue, serves as a senior fellow at Harvard University’s Center for International Development. He says having a government pay for a wall is different from individuals sending money home.

“This money is going to families, basically six million families of migrants,” he says. “It’s somewhere near 15 to 20 percent of households in Mexico.”

Orozco says they’re unrelated dynamics – the logic behind building a wall is federal while the logic of sending remittances is individual.

“It’s a family obligation that takes place, to meet certain needs,” he says. “It’s related to the amount of foreign labor in the United States.”

A wall like Trump suggests would require changes to the Patriot Act, which would require Congressional approval. To tie the two together, Orozco says remittance agencies would be required to ask customers for proof of citizenship and identification before allowing them to send money home.

“You would have to change immigration law, you’d have to change the Patriot Act,” he says, “and still you wouldn’t address the real problem that Trump thinks we are dealing with.”

The Patriot Act was originally drafted to deal with financial transactions related to terrorism or other illicit activities, Orozco says. Money transfer companies operate under what Orozco calls a “know your customer” rule, where the companies make sure cross-border transactions come with a name and address. That’s it.

“There’s nothing in the Patriot Act that deals with legal status,” he says. “The legal status, for this purpose, is not relevant. (The Patriot Act) is for the purposes of dealing with financial crime activity.”

Orozco says if anything like Trump proposes actually passes, the repercussions will far-reaching.

“The significance of this proposal, outside of the rhetoric, is something that will have a damaging effect,” he says, “not only in the world, but it will affect the image as well as the economics of the U.S.”