How Texas could suffer if Trump cut off cash sent to Mexico over border wall fight

WASHINGTON — Rep. Henry Cuellar, a border lawmaker, minces no words about what Donald Trump’s plan to force Mexico to pay for a border wall would mean for Texas.

“He would start a war,” the Laredo Democrat warned, referring to Trump’s plan to cut off payments that people in the U.S. send to relatives in Mexico. “A tariffs war, an economic war between the U.S. and Mexico.”

The payments, known as remittances, total more than $24 billion a year, according to Mexico’s central bank.

With Mexico as its No. 1 trade partner, Texas would bear significant collateral damage from a trade war.

Cuellar and many others, on both sides of the immigration debate, say they are perplexed by new details in Trump’s border security proposal, outlined in a memo toThe Washington Post this week.

In addition to blocking remittances to extract up to $10 billion from the southern neighbor to fund the wall, Trump has called for canceling visas for Mexicans traveling to the U.S. and increasing visa fees, including border crossing cards, if the country doesn’t pay up.

Trump has found few allies in Washington for the idea, with the exception of a prominent immigration hardliner, Rep. Steve King, R-Iowa. Critics question its legality and feasibility. And some, such as President Barack Obama, warn that it could have the unintended consequence of spurring people who had previously relied on that money to come to the U.S. illegally in search of work.

Former Texas congressman Ron Paul told Fox Business on Wednesday that the plan “sounds like theft” and “something immoral.”

Back home in Texas, Cuellar, fellow Democratic Rep. Filemon Vela of Brownsville, immigration experts and business leaders say the Lone Star State would suffer a deep economic blow.

Mexico is by far Texas’ primary market for exports, with Texans sending nearly $95 billion in goods such as electronics, oil and chemicals across the border in 2015 alone, according to the International Trade Administration. That accounts for nearly 38 percent of the state’s merchandise exports. Canada, Texas’ next-largest market, bought $25.4 billion of Lone Star goods last year.

Cuellar, a longtime advocate for tighter border security, expects the Mexican government would retaliate by slapping tariffs on U.S. exports. That “would have a tremendous and devastating impact” on the Texas economy, he said.

Vela said the plan to withhold funds is “one of the most inhumane policies that I’ve heard of in a long time.”

Women in Mexico’s poverty-stricken southern states are the primary recipients of remittances, according to a report from the nonpartisan Congressional Research Service. Texas sent $2.6 billion to the country in 2014 — the second-highest amount of remittances from the U.S. after California — according to a recent report from the Federal Reserve Bank of Dallas.  

But Vela also said Trump’s proposal could prevent Mexican neighbors from spending in Texas communities — something that happens regularly in border towns.

“You would think, of all people, somebody with the kind of business acumen that Mr. Trump had … would understand that we want people like that to keep coming and shopping here, not keep them away,” Vela said.

McAllen immigration attorney Carlos M. Garcia agreed.

“Mr. Trump should talk to the business community here in South Texas, because they would jump all over him,” he said, adding that Mexicans use tourist visas to shop in local malls, dine at restaurants and stay in area hotels. “They come for a weekend, spend thousands and thousands of dollars and leave it here in South Texas. Then they go back to Mexico.”

Jorge Baldor, executive director of the Latino Center for Leadership Development in Dallas, said even if Trump’s plan doesn’t come to pass, the conversation creates “animosity and fear that affects business and personal relationships.”

This is particularly damaging in Latin markets, he continued, where business often begins by developing a personal connection.

“You don’t go down there and do business. You go down there and share meals and talk about families and get involved and then the business part of it comes up,” Baldor said.

Trump’s chief rival for the GOP presidential nomination, Ted Cruz, has advocated building a wall in addition to tripling the number of Border Patrol agents, increasing aerial surveillance and improving the tracking of foreigners entering the U.S.

But it’s unclear how Cruz would fund the wall; campaign aides did not respond to a request for explanation. The Texas senator has repeatedly joked he’ll force Trump to pay for it.

Sen. John Cornyn, R-Texas, dismissed Trump’s wall proposal as “naive” on Tuesday. Without specifically addressing the remittances issue, Cornyn — the Senate’s No. 2 leader — said he doesn’t believe Trump understands the challenges and physical characteristics of the Texas-Mexico border.

Even the head of a think tank that supports tighter controls on immigration panned Trump’s border security plan as “dumb.”

Mark Krikorian, executive director of the Center for Immigration Studies, said it would be easy to bypass a remittances block by sending funds to third-party countries. He takes issue with most aspects of Trump’s plan — including the premise that Mexico should pay for a wall on American soil — and said Trump’s focus on Mexico is misguided.

“Mexico may not really be our friend, but it’s not really our enemy either,” he said, adding that the countries work together on many aspects of immigration enforcement. “Mexico is not going to play ball with us on something like that if we are trying to blackmail them into writing us a big check.”

King, the Iowa congressman who backs Cruz, said this week — without evidence — that much of the money headed south “is laundered drug money.”

“I’d like to see Donald Trump go a little further with this dialogue and see what we might be able to get done,” King told the conservative site Newsmax.

In Laredo, Rebecca Solloa watches lines form outside wire transfer stores each Friday. Now, she wonders if that could change, and what it would mean for people living in Texas whose families back home depend on remittances.

“It is going to become a more desperate situation, not only for the families receiving income, but also for individuals working here,” said Solloa, executive director of the Catholic Charities in the border town. “People should be able to do what they want with their money.”