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September 06, 2007

Economic illiteracy at the Associated Press

Kerry Howley has some fun fisking an AP report on the sinister world of remittances:

Hard to know where to start here. The use of Hawala networks for terrorist funding is not a "downside" of the remittances sent by working immigrants; it is a distinct phenomenon that happens to also involve informal means of money transfer. The actual members of that "vast permanent army of economic exiles" are not necessarily permanent, bear no relation to the military, and are only exiles in the sense of self-imposed absence. Much of the remittance cash is coming from places like Singapore and Saudi Arabia, where the immigrant population is subject to constant, state-controlled, churning.

[. . .]

The U.S. "lost" $41.1 billion? If I buy a toothbrush in China with money I made in D.C., does the treasury lose that money? We’d better stop Americans from investing abroad — think of all the money the U.S. is losing. (It's not completely clear to me whether the AP is referring to foregone tax revenue, or to forgone spending in the domestic economy, or something else. In either case, "loss" is an odd way to put it.)

Posted by Nicholas at September 6, 2007 08:43 AM

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