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Money Flies Across Borders New Britain Avenue in Hartford is one of those familiar American streets that bristle with urban alienation: from the fast food franchises to the fast oil change franchises, from the liquor stores to the gas stations. Battered cars zip by, as people commute between impoverished jobs and the oasis of family life. New Britain Avenue is a way-station; you feed your car, you feed yourself, and you pick up a video or a drink. The street is neither beautiful nor does it welcome you to sit and recuperate: it delivers some services and sends you on your way. In less than a mile, sandwiched between a store called Dollar Dreams and Pho Boston sits two branches of MoneyGram, a vast international money transfer conglomerate. One of the MoneyGram stores is run by Spanish speakers who cater to the Mexican and Puerto Rican population, while the other is run by a Vietnamese family (and is right next to the local Asian supermarket). On a Friday afternoon, the stores are full of immigrants whose facility with the forms and the argot of the money transfer business is apparent. They don't linger in the lines, but quickly send a few hundred dollars on average to their families far away who have come to rely on these transactions for their survival. These hundreds of dollars add up. The World Bank and the United Nations point out that the recorded total of all remittance flows in 2003 totaled $93 billion, while they estimate that the real figure lies between $200 and $300 billion. International agencies explain this discrepancy by the money that travels through unregulated networks (such as the hawala system that rings north Africa, west and southern Asia). Of the recorded amount, migrants in the US sent $28.4 billion to their various homelands in 2001 (a number that eclipsed the second largest source of remittance payments, Saudi Arabia, $15.1 billion). Despite the down turn in US economic fortunes (felt intensely by the polycultural working class), remittance flows have grown 13-18% in the past five years. The most affluent among the migrants are not the most generous. The most vulnerable and least remunerated workers aggressively send money to their families. In late January 2005, the Transnational Institute for Grassroots Research and Action (TIGRA) released a booklet entitled Money Down the Wire (free download available at www.transnationalaction.org) TIGRA details a scandal at the heart of the remittance business. A handful of US-based firms dominate the $19.88 billion wire transfer market, and they charge their customers between 13% and 20% in fees and commissions. To wit, tens of billions of dollars are expropriated from hard-working people whose crucial labor not only maintains the overdeveloped world in its opulence, but also maintains families in the subordinated world. MoneyGram, Western Union, Wells Fargo, Bank of America, Citibank and others charge a transaction fee (7-14%), an exchange rate commission (2.5%), an interest float on funds prior to transmission (1.5%) and often an additional fee of 5-10% for those who have no bank account. In sum, TIGRA notes, "globalized constituents lose 16-28% of their income to financial institutions." Global immigration from the South to the North exploded in the 1990s. A full third of all immigrants in the US, for instance, came here in that decade. The IMF's Structural Adjustment Policy forced states to cut back on subsidies to domestic industry, to open up agriculture to powerful agro-businesses and to shrink governmental job creation programs. All this meant that job creation in the South declined, and families found it impossible to survive without the export of an able bodied member to the North. These bodies became the lifeline for many distressed families, just as they became fundamental to the US economy (whose manufacturing working class now lives in China, and whose service working class depends on the migrants). For these families, the export of their relatives became an economic necessity, such that in Bangladesh the migrants are known as "manpower exports." But for the State in the South, these remittances are also fundamental for national solvency. TIGRA reports that a full thirty-six of the one hundred and fifty three countries in the South earn more from remittances than from any other type of public or private capital flow. For Haiti, remittances are almost a quarter of the total Gross Domestic Product, while it is a fifth of Jordan's GDP. Remittances to Mexico are almost double its farm exports, while those to Colombia are half of the revenues from coffee exports. These countries are deeply dependent on those who migrate from there, and they often rely upon the export of people for fiscal survival. Monies that come from North to South often go to families who need them to cover their basic bills rather than for social development. The money comes in outside the channels of state development policy and, because of the straits of the families involved it is rarely used to better their long-term condition. Along the western coast of India, you will find brick houses built on remittance money sent from the Gulf or elsewhere, but even here the income has not turned into substantial wealth or capital. It provides some comforts, but little capacity for accumulation.
To counter this, the US Treasurer Rosario Marin and the Mexican federal
savings bank (BANSEFI) launched a People's Network in 2003. Their game was
to offer financial services to migrants, but despite its name, the network
was driven more by the interests of States than of the migrants and their
families. Remittances will not go directly to families for their various
uses, but it will go into the Mexican bank industry to generate capital that
may or may not be invested in the people's interest. Marin, a Mexican
American, noted at the launch of the Network, Nevertheless, this approach neither targets the high fees of the banking industry nor does it deal with the long-term problem of wider social development that would allow people to live without resort to the export of their bodies for survival. Furthermore, despite the good intentions that might be part of this scheme, it is poised to replicate one of the many setbacks of the Bracero program. In that case, the State withheld ten percent of workers' wages, and then, when Bracero ended failed to pay the money back (a legal case for those back wages continues). There are currently two avenues that might mitigate the question of high fees. One comes from within the contradictions of the world of capital. Virtuoso migrants have now taken to using ATM and credit cards as a way to avoid the high fees. Visa has already produced a "smart card," a pre-paid debit card that workers can send to their families who use at ATM machines in their homeland. These cards charge about $8 per transfer, which is considerably lower than the wire transfer fees. The other is from the initiative of Representative Luis Gutierrez (Democrat-Illinois), who has introduced a bill for the past several years to regulate the wire transfer and to reduce the fees. Senator Charles Schumer (Democrat-New York) recently joined Gutierrez in this seemingly quixotic quest, with the Wire Transfer Fairness and Disclosure Act. In 2002, Gutierrez, who often finds himself on the good side of immigrant rights issues, told the Senate Committee on Banking, Housing and Urban Affairs, "Wire Transfer companies aggressively target audiences in immigrant communities with ads promising low rates for international transfers. However, such promises are grossly misleading, particularly for those with ties to Mexico or other Latin American countries, since companies do not always disclose extra fees charges for converting dollars into local currency." The legislative work needs to be extended in our communities. TIGRA has launched a wider struggle, although it too demands "lower fees, increased transparency and access." In terms of its claims on the banks, TIGRA calls for an expansion of the reach of financial services to rural areas, where the farm workers toil. Apart from these demands, which are echoed in the Gutierrez bills, TIGRA wants to extend the fight both in the North (particularly in the US) and in the South. For the former, TIGRA calls for an "increased investment in poor communities in the US," partly, I imagine, to move service jobs into its residents who have as yet been cut off from the jet-stream of economic activity. For the South, TIGRA calls for the cancellation of debt, specially "odious loans," because it is this condition of global debt that drives the post-1990 migration patterns. The same financial institutions that profit from the remittance skims also invest in the perpetuation of global debt through onerous loans and purchase of World Bank bonds (remember the Economic Hit Men?). New Britain Avenue is not suffused with alienation. For almost two and a half years, not a mile away from one of the MoneyGram offices, the polycultural workforce of Avery Heights nursing home went on a fierce strike. Organized by 1199, the union held out against the owners, Church Homes, and despite personal trials and State obduracy, they won. Their unyielding picket line gathered together workers from across the planet, but mainly from those who frequently remit money to their families. Unwilling to accept the terms of alienation, they fought back from 1999 to 2002, and made some gains. Ripped off by their piously named workers and by the banks, these workers nonetheless held fast for the transnational networks that they represent. Money might fly all over the place, but it does not rest long with them. |
