From day one, Donald Trump has promised a “big beautiful” border wall on the Mexican border, and better yet, informed us that Mexico would be paying for it. Any time a Mexican politician (or in particular, former President Vicente Fox) said there’s not a chance in hell Mexico would be paying for the wall, Trump would joke that the wall “just got ten feet taller.”
On his campaign website, Trump says that he’ll threaten Mexico with a ban on remittances from the US to Mexico if it refuses to pay for the construction of the border. Mexico benefits $24 a billion year from remittances of Mexican nationals working in the US. He also proposes a small increase in visa fees as a way to raise revenue for the wall.
When he spoke with Mexico’s current president earlier this week, however, Trump continued his advocacy for strong borders, but didn’t bring up how it would be funded. Trump tweeted, “Mexico will pay for the wall!’, but Mexico’s president wrote back, writing (translated), “I repeat what I told you personally, Mr. Trump: Mexico would never pay for a wall.”
Repito lo que le dije personalmente, Sr. Trump: México jamás pagaría por un muro. https://t.co/IJNVe0XepY
— Enrique Peña Nieto (@EPN) September 1, 2016
According to LifeZette, Trump is still insistent Mexico will be paying for the wall, and he’s coming up with more creative ways to make it more enticing for our neighbor south of the border. To fund construction of a new U.S. border wall, Donald Trump and senior advisers are considering various ideas, including the use of assets seized from drug cartels and others in the illicit drug trade.
As the debate over who will pay for the wall dominates the discussion on cable news, sources involved in the pre-planning of the GOP nominee’s Mexico trip told LifeZette the Trump camp is looking for innovative ways to pay for the construction of the border wall that both countries can support. Sensitivities in Mexico regarding Trump’s visit, and specifically paying for the border wall, are running high.
“For decades, the illicit drug and arms trade has endangered and destroyed the lives of countless Mexicans and Americans,” noted one individual who has advised Trump on immigration. “It would be sweet justice to use their illegal profits and property for something good.” A senior Trump policy advisor stressed the proposal was just one of several funding options being discussed and said the idea was not raised during Trump’s meeting with Mexican President Enrique Peña Nieto.
Advocates of the “make the cartels pay” plan believe it has the added benefit of punishing the “worst of the worst who bring violence to our streets and prey on innocent Mexicans and Americans,” while giving political cover to both leaders to accomplish their objectives. Sources close to both the Mexican government and the Trump campaign have confirmed that this proposal exists, but wish to remain anonymous given the preliminary nature of the discussions.
The plan could involve the creation of a “joint border security fund,” where assets seized by law enforcement in both nations are deposited, then deployed for construction and maintenance of the border structure to the benefit of both Mexico and the United States.
That solution could go a long way toward paying for Trump’s wall within the first term of his presidency.
According to the Justice Department’s annual audit of its existing seized assets forfeiture fund for fiscal year 2015, that fund totaled more than $8.7 billion. That figure does not include any assets seized from the cartels by the Mexican government.
A detailed analysis of the cost of constructing the wall conducted by the Bernstein Group estimated the project would cost in the range of $15 billion to $25 billion, but Trump contends he could get the construction done for closer to $8 to $10 billion.
Whatever you personally feel about the wall itself, Trump’s thinking on this demonstrates a creativity we don’t often see in government leaders on how to pay for things; there are more innovative and productive ways than simply “raising taxes.”
Think Trump has finally come up with an offer Mexico can’t refuse? Its response to such a mutually beneficial deal will speak wonders about what its true motives are.
[Note: This post was written by The Analytical Economist]