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US Dollar Decline Impacts Immigrant Remittances

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Nathan King, Voice of America News, January 3, 2007

The value of the U.S. dollar has dropped about 20 percent against a basket of major currencies in the last five years. This decline has been especially tough for immigrants who work in the United States and send money to their families back home. As Nathan King reports from New York, these dollar remittances are key for the economies in many developing nations.

Eric Amaoako says he is working harder to send money home to his wife and his parents in Ghana

No weekends off and as much overtime as he can get. Eric Amaoako lives and works in New York, but has four children, a wife and his parents relying on the $200 he sends back home each month to Ghana.

In previous years, life hasn’t been this hard for Amaoako. But because of the continued depreciation of the U.S. dollar, the money he sends home has less purchasing power so he has had to work harder and longer to send more.

“I have to work double shifts, weekends, when I am supposed to take off. I have to work because I need more money now [that] the dollar is falling. I need more money to meet my commitments,” Amaoako said.

Eric is not alone. With the dollar at record lows against many major currencies, millions of people are having to send home dollars that are worth less or work harder to send more money.

That can have a big effect on poorer countries. The World Bank estimates remittances to developing countries totaled $240 billion this past year. The Bank says some countries rely on remittances for up to half their national income.

Dilip Ratha is the World Bank’s Chief Economist on Remittances. He says the dollar’s fall already is leading to calls for wage increases from migrant workers. “They are saying, ‘Look we came here only to be able to send money and support our families so please give us wage increases,’ and that has led to some discontent for some migrant workers.”

Ratha believes that over time this situation may turn the pattern of migration away from the United States. “This is obvious — migrants are looking for greener pastures. A stronger currency helps, [so] they are going to go for countries where the currency is stronger and buy more for their families back home.”

But for those, like Eric Amaoako, who are already here in the United States with a job, each dollar earned and sent home has less value than before.

Original article

(Posted on January 4, 2008)

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Comments

“They are saying, ‘Look we came here only to be able to send money and support our families so please give us wage increases,’ and that has led to some discontent for some migrant workers.”
Not America’s problem, you came here ILLEGALY, you are a criminal, nothing more, nothing less.

Posted by Jim at 7:08 PM on January 4


Ratha believes that over time this situation may turn the pattern of migration away from the United States.
God, bless America.
Now here’s another problem. How are we going to survive without these laborious saviors.

Posted by alex at 7:13 PM on January 4


So how is the dollar doing these days in real local market basket purchasing power terms compared to a year ago in the streets of Morelia, Michoacan, Tegucigalpa, Honduras, and San Salvador, El Salvador??

Posted by Flaxen-headed Strumpet at 7:17 PM on January 4


Along with employer sanctions, an even more obvious target is to require intrusive, redundant ID checks for overseas wire transfers. Maybe tax them heavily too, with the proceeds going to immigration enforcement.

Posted by Irish at 12:25 AM on January 5


That sucking sound is the teat being pulled out of the Third World’s mouth. Expect the squalling and tantrums to being any day now.

Posted by Wild Eyed Charlie at 12:48 AM on January 5


It’s not going to keep the simple-minded immigrants from coming here anyway because they like to live in white societies, even though the dollar may not buy much elsewhere.

Posted by Ben D. at 2:29 AM on January 5


This is only one face of the collapsing dollar. Another is us Americans living overseas who have US$ savings, pensions, SS, disabilities, etc. Our income has decreased over 20% since I moved to Southeast Asia a little over two years ago. If the US$ keeps sinking, maybe us American expats will be forced to return home and we can take the place of the returning illegals. To make matters worse, many of us are Race Traitors as we have local wives, so we will not be welcome in the USA.

Another face is the cost of your imported goods will shoot through the roof - this includes oil, cars, and electronics.

No, nothing good comes from devaluing our currency, we will all be losers.

Posted by Lost in Paradise at 4:13 AM on January 5


Economically, the whole point of a declining dollar is actually to vitiate the impact of external demands on the dollar - such as these remittances, that obviously total up to a serious imbalance.
Therefore the whines are just a nonsense!

Posted by Kenelm Digby at 7:48 AM on January 5


He’s complaining? At least he has jobs to work at. I can round up several people in five minutes that would love to have those jobs.

Posted by at 9:36 AM on January 5


Don’t believe this story. There are too many benefits here for the immigrants such as good working conditions, better pay, flexibility, opportunity, etc.
It sounds like a liberal story of a few people.

Posted by Herb at 10:56 AM on January 5


Could the irony be any more glaring here? A writer from a news site calling itself “Voice of America News” is consumed with grief over the deleterious effects of our increasingly worthless, plummeting dollar on REMITTANCES TO FOREIGNERS?

Please, just once, could SOMEONE express similar concerns for the struggling, American, cash-cow middle class? Especially considering they are so willfully ignorant as to the reasons for our hyperinflation and plunging currency.

Posted by Voir Dire at 11:31 AM on January 5


What a sad story just anchoring my heart to the ocean floor. How much time has this sad sack thought about our troops in combat zones dying for the freedoms of all people?

Posted by Lars at 3:22 PM on January 5


Voir Dire, good points about Americans general ignorance of their situation. They will soon wake up. As to the irony of the concerns that the “Voice of America News” has for those who should not even be here, I see your point but it isn’t really that weird. Think of things like the Democratic Republic of Germany, the Peoples Republic of X, etc. All part of don’t judge a book by its cover,etc.etc.etc.

Posted by Bobby at 6:21 PM on January 5


“Ratha believes that over time this situation may turn the pattern of migration away from the United States.”


Oddly, this could turn out to be a blessing in disguise.

Posted by at 1:13 AM on January 6


The value of the dollar is falling because the US economy is weak, driven largely by consumer spending, with little or zero net savings and a massive balance of trade and federal deficit. Yet to complain about this economic fact because it has a negative impact on money sent back by an illegal to Ghana is just too much. In fact large scale remittances of dollars out of the country where they could do some economic good are part of the cause of the dollar’s decline. How anyone could ever think that such a story would evoke sympathy for the “poor illegal just trying to feed his family in Ghana” is absolutely beyond me. The very idea of immigrants coming to America in order to support foreigners in other countries is pathetic. One way to immediately help the US dollar would be to place a 50% tax on all remittances of US dollars out of the country by illegals. Who could possibly be against such a law?

Posted by at 7:53 AM on January 6


“One way to immediately help the US dollar would be to place a 50% tax on all remittances of US dollars out of the country by illegals. Who could possibly be against such a law?”
Posted by at 7:53 AM


Probably George Bush!
But I think it’s a great idea, and I’m all for it.

Posted by voter at 4:18 PM on January 6


This is just too, too, sad. Maybe the average working stiff in the USA who is having a tough time making it for himself could be taxed just a little extra so the illegals checks home could be subsidized? Heck legal Americans don’t need to eat everyday do they?

Posted by T-"Rexx at 4:53 PM on January 6


The parasitic elite and these third worlders don’t seem to understand that eventually, you’ll can kill the goose that laid the golden egg. Read “Atlas Shrugged”

Posted by Tim at 12:22 AM on January 7


Our dollar is even losing purchasing power against third-world countries and if this doesn’t serve as a wake up call for the American public I don’t know what will. Virtually every tax dollar Washington extorts from the public goes towards paying the interest payments on the national (federal) debt while Washington sells new treasury bonds every year to finance government wages, bureaucracies and entitlement programs. Since Washington has allowed millions of jobs to be outsourced and insourced there are fewer and fewer employed Americans to collect taxes from every year to pay those interest payments. So now Washington is floating more and more treasury bonds to pay the interest payments on bonds issued previously, and this, along with the foreign trade deficit, is what is destroying the value of our currency. You can thank our smiling members of congress for this and now you know why our bankrupt economy isn’t even a campaign issue this election…

Posted by at 12:36 PM on January 7


A dollar-carrying American tourist in Europe today feels like an impoverished relative at the ball. Remember the classic travel book, “Europe on Five Dollars a Day”? Anyone who can remember the 60s and 70s will. I did it in Spain, so I know. Those days are gone forever! Six cents for a glass of wine, lesss than a dollar for a dinner. Today, a hundred bucks in Madrid won’t get you even a flop house. Thank you, George Bush.

Posted by 1492 at 3:56 PM on January 7


Look, it isn’t GWB or any other single person that is responsible for the coming “ROLLOVER” or the destruction of this once great country. It is the weak and ignorant majority of the population of the United States that is responsible and will endure economic hell starting, by my calculations, this year. No, things refuse to be mismanaged and like Rhodesia, our nation is getting ready to learn that lesson in spades.

Posted by Al at 9:56 PM on January 7


Why should the Voice of America be worrying about the effect of the dollar’s decline on the remittances of immigrants? Is that the most important effect that they can think of? Oh, the poor immigrants! Their families back home in Africa are suffering from shriveled dollars that don’t buy so much.

Isn’t the VofA an agency of the US government? Shouldn’t the US government be concerned about its OWN citizens and their welfare FIRST OF ALL?

Posted by voter at 3:06 AM on January 9



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