Ag sector could suffer if Trump delivers border wall, economist says
A prominent national economist thinks Wisconsin’s agricultural sector could suffer if President Trump delivers on his promise to build a southern border wall.
Marci Rossell, former chief economist for CNBC, spoke yesterday at the Wisconsin Bankers Association luncheon. She pointed out that net migration from Mexico has been negative since 2006, meaning more people from Mexico have been leaving the United States than entering.
Immigration from Mexico peaked in 2000 before tipping negative, she says, as a demographic boom of young people drove many to seek better opportunities in the United States.
Now, she notes most of the immigrants coming over the southern border hail from other countries further south.
“Any guess what the demographics of Honduras, El Salvador and Guatemala look like? Well they too had a baby boom, and it was 10 years after Mexico,” she said. “So what happens in the next five years to immigration naturally? It just tapers off, just like Mexico.”
She says clamping down on immigration now could spell trouble for the ag workforce, based on previous immigration patterns.
“The reality is, the demographics aren’t there to support further immigration,” she said. “If you think your dairy industry in the state has labor problems now, give it five more years.”
Rossell also said she doesn’t expect the country is on the path toward a recession. Though the tax cuts brought up the trend rate of economic growth, she says that’s about to be diminished by the government shutdown, ripple effects of Brexit and the ongoing trade war.
She expects GDP growth to slow in the first quarter of 2019 before bouncing back to more healthy levels of growth. For a recession to occur, she says there would need to be a significant problem in a sector of the economy such as real estate.
“Because this is not sort of real estate slow down or anything like that, I think it will look much more like a slowdown rather than a recession,” she said.
Listen to audio from the luncheon here: https://soundcloud.com/wispolitics/wisconsin-bankers-association-economic-forecast-luncheon-2019