Cash That Goes Back Across the Border
Mexican workers often come to the United States to earn money and send it to their relatives back home. But NPR reports that as the U.S. economy has gotten worse, some of these worker's families are sending them money from Mexico.
It's a phenomenon that could have a positive economic impact: These reverse remittances, as they're called, allow the migrants to keep searching for higher-paying work than they could get in Mexico, explains an NPR report. These reverse remittances may also prevent a flood of returnees from further devastating Mexico's economy and increasing unemployment.
When the U.S. economy rebounds, these workers are well-positioned to start sending remittances back to their families again.
These remittances play a big roll in Mexico's economy — they're the country's second-largest source of foreign income.
Still, the total dollar amount of reverse remittances remains small in comparison to the traditional southward flow of cash and there is no reliable data about its overall volume, points out a World Bank report.
As one Mexican father of a migrant worker told the New York Times, “We have an obligation to help them [until they find work again]. They’re our sons. It doesn’t matter if they are here or there."
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The mother of all economic crises
Starting from the Great Depression in the thirties, we have had many recessions and depressions. As the world becomes more and more interconnected, the impact of a crisis tend to be more serious, as its shock waves reach every part of the world.
Every economist believes that by expanding consumption, more jobs could be created. More jobs mean still greater levels of consumption. Majority of jobs in the world now have been created for manufacturing goods and providing services which are not essential for human existence. A century back, most of the industrial products like electronic goods, motor vehicles, electricity, cosmetics or services like inter continental air travel and tourism did not exist. In short, the prosperity and wealth of nations is a direct result of increased consumption and new industrial products.
Suppose an event which shakes the world with unprecedented vehemence. A nuclear bomb sneaked into New York City and exploded, an unexpected earthquake with unprecedented magnitude, or a shower of meteors may send the world economy plummeting. Overnight, millions of jobs will cease exist. Without any purchasing power, the people who have become unemployed will stop consuming resulting in another round of job losses. In a few weeks, the level of consumption may reach 1910 levels.
The chaos that will follow may ruin the whole of human civilization.
Please also read my articles in narimattom.blogspot.com
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