Tuesday, October 03, 2006

Don't fence me in


One of the last things Congress did before adjourning was to pass legislation authorizing the start of the fence between the US and Mexico and a $1.2 bln down payment on a 700 mile stretch. Here's the kicker, according to the article no one knows just how much the fence will cost. My rough calculation based on the San Diego fence is $6.325 bln for the 700 miles.

So let's have some fun.

Cost: Whatever cost is budgeted and/or publicized will be nowhere close to the actual cost. Personally, I think the over/under is initially three times. Anyone who's ever done their own building/remodeling, or followed government spending would probably agree. Long term costs will easily blow through the 3x figure owing to upgrades, maintenance, staffing, etc.

Effectiveness: We also know it won't work. Won't keep illegals out to any real degree and more importantly, it won't keep terrorists out. Look at the Berlin Wall, the only real example for our Mexican Wall. There's an entire museum show-casing the innovative ways people trafficked others past the guards. And this was a major wall with mines, guns, camera's and no pretense of privacy of citizen rights. Is the smart assumption that our "fence" will work better, or worse than the Berlin wall? The reality is that all it will lead to is ever increasing fortifications, at ever increasing costs, followed by the inevitable break down of civil rights for people moving legally across the border.

Additional expense: Like it or not, our economy relies on "undocumented" immigrants. Take them out of the labor pool and costs for a large basket of goods and services go up. So not only do American's pay for the wall, but they pay daily with higher priced goods and services. Which leads to...inflation. All this talk about increased technological efficiency keeping wages down ignores the fact cheap illegal labor also keeps wages down. Combine the two, and you get a super whammy bang on keeping prices down. But take out cheap labor, prices go up, the Fed increases rates to ward off inflation, and the economy tanks. Hurray! Sorry, but illegal immigrants are like oil. The simple fact is that our economy is dependent on both, like it or not. Getting rid of illegals is like banning oil. It may make some people feel good, but economically, it's a really stupid move.

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