Commentary

Why Not a North American Union?

By Will Wilkinson
This article appeared on Marketplace on January 9, 2008.

There are some who believe a grave threat to American sovereignty looms over the horizon. A shadowy cabal, they say, is planning a massive “NAFTA superhighway,” a new North American currency, and a common market in goods and labor. It will all culminate in an E.U.-like North American Union.

It turns out this is mostly fantasy. But the fantasy is more dream than nightmare. Because some aspects of a North American Union would leave Americans and our neighbors both richer and freer.

The population of undocumented migrants in the U.S. has grown rapidly in recent decades — in part because we have implemented increasingly restrictive border policies. What we’ve done is make passage riskier. This has slowed in-migration. But those who do come now are more likely to stay. And this has increased the permanent population of undocumented Mexicans.

The best solution to America’s immigration problem is not a wall or a new crackdown on the hiring of undocumented workers. It’s NAFTA’s unfinished business: a common North American labor market. It’s illogical and impractical to create a single North American economy that integrates markets for goods, capital, raw materials, services, and information but tries to keep labor markets divided.

Mexico’s GDP per capita is about what Poland’s was in 2004. That was the year Poland became a part of the E.U., and started sending a large flow of newly-legal migrant workers to a much wealthier Britain. This neither increased British unemployment, nor overtaxed social services.

It’s been a boon to both the British and the Polish economies, and a higher percentage of Polish workers now circulate back home. Romania and Bulgaria are even poorer than Mexico, but they are now set to integrate their labor markets with the rest of the E.U. in seven years.

If they can do it, then so can we. And if a humane and effective policy of labor mobility is what a North American Union would deliver, then what is there to fear?

Media Appearance Will Wilkinson discusses an EU-style North American union on Marketplace (January 9, 2008) [Real Media, MP3]

Will Wilkinson is a research fellow at the Cato Institute.