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Economic Study Shows Impact Of Existing Wall At The U.S.-Mexico Border


President Trump's calls for a wall to be built on the U.S.-Mexico border have been controversial to say the least. But between 2007 and 2010, more than 500 miles of secure fencing were built along the southern border. Cardiff Garcia and Stacey Vanek Smith, who host the Indicator podcast from Planet Money, decided to look into what the economic impact of the existing wall has been.

CARDIFF GARCIA, BYLINE: Jesus Morales lives in Naco, Ariz. That's a little town of about a thousand people right on the border with Mexico.

JESUS MORALES: My mom was born here. My grandma was born here. My great-grandmother on my grandpa's side, my mom's side - she was born here way before this was even a state.

STACEY VANEK SMITH, BYLINE: Jesus has always had family on both sides of the border. But when he was young, Jesus says it didn't really even feel like a border.

MORALES: We still had a chain-link fence, and they would just jump through there. They'd come to the convenience store, buy their groceries and just walk right back.

VANEK SMITH: That chain-link fence was eventually replaced by a solid metal barrier and then an imposing iron fence or what often gets referred to as the border wall.

GARCIA: Donald Trump has been talking about a wall along the U.S.-Mexico border ever since he was on the campaign trail. It's one of his big issues.

VANEK SMITH: But this is not the first time a president has pushed for a border wall. Back in 2006, President George W. Bush passed the Secure Fence Act. And part of the logic behind building a wall is economic. It's about jobs. There's this idea that undocumented workers take jobs, and then they push down the wages for those jobs.

GARCIA: Melanie Morten is an assistant professor of economics at Stanford. And she's one of the authors of a paper about the economic effect of the Secure Fence Act.

VANEK SMITH: The first question Melanie and her colleagues asked - did the wall work? Did the number of undocumented workers coming from Mexico drop as a result of the wall?

MELANIE MORTEN: And so we find that the wall did change migration patterns but that the total effect was small.

GARCIA: Really small. The number of undocumented workers coming into the U.S. fell by .6 percent after the wall went up.

VANEK SMITH: Melanie says people seemed to have found ways around the wall. And Jesus Morales in Naco, Ariz., says this was consistent with what he saw.

MORALES: When they put that metal wall, the solid metal wall, they actually cut it. And they did a little door and put (laughter) hinges on the Mexican side. So they would open that little door. People would run in. They'd close the door.

VANEK SMITH: The other thing Melanie and her team looked at was how the expansion of the wall affected wages for U.S. workers.

GARCIA: Her team specifically looked at the wages of U.S. workers before the wall was built and then after.

MORTEN: We estimate that the wall led to a gain of income of only 40 cents per year for low-educated U.S. workers.

VANEK SMITH: Forty cents per year - that was the increase in wages that low-skilled U.S. workers saw because of the border wall.

GARCIA: And Melanie's team calculated that every U.S. citizen paid the equivalent of $7 to build the wall. And so, Melanie says, even the low-skilled workers who saw a tiny uptick in wages lost money in the long run.

VANEK SMITH: Jesus Morales in Naco, Ariz., says he doesn't think Naco should go back to the days of the chain-link fence. But he says all of the border wall talk he's been hearing, pro and con, just doesn't seem to have anything to do with his experience of the actual border.

MORALES: You know, a lot of these politicians kind of demonize the border. Oh, yeah - no, no, it's hell on earth. No, it's not. I'd actually invite them to come and look at the border.

VANEK SMITH: He says it's a lot more nuanced and a lot more boring than everyone seems to think. Stacey Vanek Smith.

GARCIA: Cardiff Garcia, NPR News.

(SOUNDBITE OF JAM DA SILVA SONG, "BEM TRANQUILO") Transcript provided by NPR, Copyright NPR.

Stacey Vanek Smith is the co-host of NPR's The Indicator from Planet Money. She's also a correspondent for Planet Money, where she covers business and economics. In this role, Smith has followed economic stories down the muddy back roads of Oklahoma to buy 100 barrels of oil; she's traveled to Pune, India, to track down the man who pitched the country's dramatic currency devaluation to the prime minister; and she's spoken with a North Korean woman who made a small fortune smuggling artificial sweetener in from China.
Cardiff Garcia is a co-host of NPR's The Indicator from Planet Money podcast, along with Stacey Vanek Smith. He joined NPR in November 2017.