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Reflections from Latin America
September 3, 2007
Bryan Caplan asks “Why don’t Hispanics Beg in America?” (Econlog, August 23, 2007.)
As a Latin American who does not live in the United States, I simply cannot imagine a more difficult question. It stirs so many disquieting ideas and feelings! It brings to mind many other questions that apparently are not connected.
Questions like “Why can the Latin American emigrant labor force (including illegal aliens) in the United States and some European countries send home 50,000 million dollars in remittances on any given year while many of those who stay home, people who share the same skills and education levels with their emigrant brothers and cousins, languish at the fringes of their economies?”
Though a terribly difficult question, Caplan hints at a couple of very persuasive answers. He suggests:
On the demand side, I suspect that Americans are less willing to give money to Hispanic beggars because they see them as “foreigners.”
On the supply side, I suspect that Hispanics are unusually likely to see begging as shameful, and unusually willing to do unpleasant jobs for what Americans see as low wages. The strength of Hispanic family ties also plausibly plays a role.
Most of the posted comments concur with this idea of Hispanic work ethics, personal pride and family values.
Dr. Caplan’s arduous question triggered the loose intimations that will follow. None of them is about how do Hispanics behave or get along at the receiving end of the migrant flow and why. This article is about who is he or she before leaving for the United States or, say, Spain. My first contention is that, in most Latin American contexts, anyone who emigrates for economic motives is something of a dissident.
The decision to emigrate usually implies a stark departure from ideas prevailing in our countries on how wealth is created. Many conventional populist “redistributive” values are challenged by anyone who decides to leave in search of individual opportunities amidst another culture.
By deciding to emigrate he or she might not be just yielding to despair but also doing something out of their deep disagreement with the all-pervading corrupt practices of their governments.
Back in the 1990s it became fashionable to exult in the “entrepreneurship” showed by Latin American informal-economy workers. Many pundits contended that Latin Americans working in the informal economy displayed an uncommon ingenuity, a hard-to-find drive to create small businesses and be their own bosses that allowed them to be competitive in economic ambiances definitely unfavourable to run-of-the-mill legitimate business activity.
Time has shown that it takes more than individual ingenuity and drive to explain the survival of underground economies in our continent and that, for instance, yielding to government’s officials corruption to dodge high transaction costs in order to run a street-side outlet of smuggled or pirated goods does not make you a Schumpeterian innovator.
The emigrant is not only fleeing poverty. By deciding to leave his country he is fending off faulty and corrupt institutions and a lack of clear rules that keep him from attaining personal fulfilment and curtail his right to succeed in the trade of his choice, the one his talents and skills enable him most. More often than not it is a personal war fought by the stubborn raro de la familia (“the wacky one in the family”), el que se fue p’al norte (“the one who left and went North”).
Allow me a word or two about work ethics. A recent report released by the Inter-American Development Bank shows how remittances from Mexican immigrant workers living in the United States equal 3% of Mexico’s GDP, and 10% of its annual exports.
Mexico is by far the largest recipient of remittances, at over US $20 billion. Dominican Republic and Central America combined reached over US $11 billion. Brazil and Colombia reached over US $6 and US $4 billion respectively.1
“Unskilled” is the word most frequently used by specialists to qualify most of the immigrant labor force that every year sends US $40 billion back to their country. Such an impressive achievement can only be explained by something in the “physiology” of the host economies. Productivity seems to be the answer.
Contrary to what used to be conventional wisdom pertaining German and Japanese economies in the 1970s and ’80s, U.S. workers, including Hispanics, nowadays achieve the highest productivity in the world in most economic sectors.
Discussing the findings on productivity made by the McKinsey Global Institute during a 12-year research project, William W. Lewis says, “the importance of the education of the workforce has been taken away too far. In other words, a high education level is no guarantee of high productivity.”[…] “Whatever weakness exists in the U.S. education system, it is being made-up for by on-the-job training.[…] If illiterate Mexican immigrants can reach world-class productivity, building apartment houses in Houston, there is no reason why illiterate Brazilian agricultural workers cannot achieve the same.”2 William W. Lewis’s book, The Power of Productivity: Wealth, Poverty, and the Threat to Global Stability, is available at Amazon.
Obviously, this sheds light on the motives of so many illiterate immigrant workers, illegal or not, whose countries of origin are plagued by all kinds hindrances to individual initiative and legitimate ambitions of family affluence. Viewed this way, immigrant remittances are a trustworthy index of hard work, thrift and family devotion to which the U.S. Hispanic population are very much attached. But thrift and family devotion, I am sad to say, do not seem to be so highly valued “back home.”
I think there is much to say about family ties in Latin America. According to many serious studies, as I write this there are, roughly speaking, 90 million female-headed households in Latin America, half of which live in poverty. Where are all the hard-working, family-oriented men who fathered all those abandoned kids?
Again, as with work ethics, it would seem a special attribute of those who emigrate to be concerned by the fate of the extended family left behind. This would certainly help explain the enormous flow of remittances, but it should not lead us to think that, on the whole, Latin Americans attach a special primacy to family ties.
Which leaves me with the beggar’s question. Strangely enough, begging is not always considered so shameful in Latin America as anyone guiding himself by the mores of Hispanic U.S. population would think. This paradox can be better grasped when a famous 1948 Argentinian movie is considered. The movie is called Dios se lo pague (“May God reward you”), a Spanish traditional expression used by grateful beggars.
Dios se lo pague became en instant box-office hit. So successful was it that during half a century it has morphed into countless remakes as TV movies or telenovelas. For some facts about this 1948 movie, see Dios se lo pague. For more discussion, see “Dios se lo pague“, by Ibsen Martinez. El Nacional, August 6, 2001 (in Spanish).
Dios se lo pague is a Latin American fable on the very rich and the very poor. The main character, Juca, played in the original movie by Argentinian foremost actor Arturo de Córdoba, is a beggar who eventually acquire enough equity capital to sit as chairman of the board of the very same firm that, twenty years before, robbed him of an invention patent and expelled him from his lab.
Right from the very first sequence of the movie, a wretched old man is begging in front of a church. No one going into mass seems to have a penny to spare. Then along comes Juca, who befriends the erratic beggar and teaches him the secrets of the trade: whom to beg and what words to say in each case to move charitable feelings. All along in the movie, Juca extols poverty and derides profit despite his most visible schemes to become CEO of the firm. By the way, he gets the girl, too.
The mere proposition that by begging you can amass enough wealth to buy premium shares and chastise the stingy, malevolent rich with a hostile take over makes “Dios se los pague” an apt homily in favor of populism. No wonder its popularity has lingered on for generations.
Have not the seductive skills of Latin American populism been able to transmute citizens into beggars while, at the same time, infuse them with the conviction that their servitude gives them back whatever they have been robbed of?
1 Inter-American Development Bank; Remittances 2005: Promoting Financial Democracy. Washington, D.C. March 2006.
2 William W. Lewis. The Power of Productivity: Wealth, Poverty, and the Threat to Global Stability, University of Chicago Press, 2004, p.11-12.
* Ibsen Martinez is a columnist, journalist, and award-winning playwright from Caracas, Venezuela. His writings have appeared in El Nuevo Herald, Miami, Letras Libres, Madrid, and El Pais in Madrid. Since 1995, he has written a weekly column for El Nacional.