I am glad to be back at the City Club — this is one of my favorite occasions because of the spirited discussion that follows my opening remarks. In past years, I have spoken about MacArthur’s work in its hometown and on our global programs, with particular attention to the UN. Today I have chosen a topic that ties together our domestic and international interests: the global mobility of people. Notice I did not use the word “immigration,” which I think is limited, and often conjures up negative images — illegal border crossings, competition for domestic jobs, challenges to local culture. New thinking, which MacArthur is supporting, takes a global perspective and sees the movement of people as a natural — and mostly positive — phenomenon, but one as yet not well understood.
The Chicago bid for the Olympics has accelerated our sense of self as a global city. Our history of welcoming new immigrants contributes to our cosmopolitan sensibilities. Chicago is a case study for the new way of thinking about human mobility as an engine of development and economic vitality. More on that in a moment. But first, the “headline news” version of recent events at MacArthur.
We all feel the economic decline and MacArthur is no exception. Our endowment lost about 25 percent in the market last year after five years of tremendous gains. From a high of almost $7 billion, we closed the year under $5 billion. During the good years, when MacArthur had the best performance of major foundations, we set aside some reserves. So we are able to maintain our giving at $250 million this year, I hope next as well.
MacArthur has a history of remaining steady in times of economic turmoil. It is important for our grantees to know they can count on us to be there for them. Recessions feed on fear and uncertainly and we will do our small part to quiet anxieties.
In Chicago this year we increased, by an average of 20 percent, our grants to arts and cultural organizations and set up a bridge loan fund at Shorebank to help with their short-term liquidity challenges.
Affordable housing preservation is one of our main programs — essential to improving central city neighborhoods. Last year there were 20,000 foreclosure filings in Chicago, more are expected this year.
MacArthur launched a $70 million foreclosure prevention and mitigation initiative aimed primarily at the 16 neighborhoods from Humboldt Park to West Haven, from Bronzeville to South Chicago where we work with LISC through the New Communities Program. The aim of the initiative is, over two years, to counsel at least 6,000 families and prevent 2,000 foreclosures by making sustainable financing available. We are working with Neighborhood Housing Services of Chicago on counseling and with Shorebank and Self Help Ventures on new loan products.
On some hard-hit blocks there are already foreclosures that invite crime and drive down real estate values, a blight in neighborhoods that were getting better. We are supporting the City of Chicago's "back-end" efforts to purchase these properties and, with its partner, Mercy Housing, to put them back into productive use through sale, rental, or an innovative lease-to-purchase program.
Beyond Chicago, we are determined not to let the economic downturn cripple our major initiatives. We are moving ahead with a new Asia Security Initiative, a new program to strengthen the regional court in Africa to address human rights abuses, an expansion of our juvenile justice work in the U.S. to include indigent defense, a new focus in our conservation work on adaptation to climate change, a stepped-up investment in helping India and Nigeria meet MDG #5 — a reduction in maternal mortality.
And, final headline, we have created an expert committee at the National Academy of Sciences and National Academy of Public Administration to study the fiscal challenges our country faces. If current budget policies are continued, America’s public debt will reach 60 percent of GDP by 2010. Spending on Medicare, Medicaid, and Social Security will more than double by 2050, from about 9 percent of GDP at present to nearly 20 percent. Add entitlements to interest on the federal debt and, by 2030, all federal revenues are spoken for, with nothing left for education, the environment, research and development, or infrastructure.
All made worse by new borrowing for the stimulus package. The consequences could be catastrophic. Other nations may become reluctant to lend to the U.S., which could lead to massive inflation or a collapse of the dollar.
The nonpartisan expert committee this fall will lay out the problem and offer four scenarios for addressing it. The scenarios will be based on widely held values and preferences of segments of the American public. Some will favor defense, others domestic equity, and so forth. All will involve painful choices and the wise use of public monies.
I do not want to leave too rosy a picture. MacArthur, like all foundations, will have to adjust to a lower endowment. But we are charting a glide path, not a crash landing. Through it all, we will protect our core fields like housing and human rights and our local commitments to neighborhoods, and arts and culture organizations. But there will be less money for nice-to-do, out-of-strategy ideas — at least for a while.
I can say more about all this in the question period. Let’s move to our main topic.
Migration is one of the constants of the human experience. From Africa, the world’s first people spread across the globe, seeking new resources. The founding stories of many cultures tell of the journey to new lands. And much of recorded history deals with the movement of people: travel, exploration, invasion, or colonization.
Americans have an intuitive grasp of migration’s importance. We are often called “a nation of immigrants.” And Chicago is one of the great immigrant cities of the world, built by those who moved here in the nineteenth century from Europe and the East Coast, by African-Americans from the segregated South, by Mexicans from Zacatecas or Michoacán, and by a global diaspora today. We tend to see human mobility through the lens of seeking opportunity in a new nation, assimilating, becoming citizens. But that is only one narrative.
Globally, 200 million people live outside the countries of their birth. Some have moved to take temporary jobs — on construction sites, in high-tech start-ups, in nursing homes or mines. Others are students, earning credentials and learning about another culture. Still others are joining family members abroad, grandparents or siblings. And a growing number are retirees, seeking sun, space, or leisure. Not all have moved for good. Some plan to go home, eventually, more financially secure or better qualified. Others will move constantly, from nation to nation, as they are transferred by multinationals or start work on the next big project. Others will go back and forth between their country of origin and their new home.
Modern transportation has made mobility cheaper and easier. And new communications technology keeps people connected to more than one nation, active in social, professional, and political networks. Such people are naturally multicultural and transnational, and they may choose to retain connections to their home countries, even over several generations.
All these kinds of migrants constitute a powerful trend in the interconnection of our world. And yet, migration is — of all the aspects of globalization — the least well understood and most poorly governed. This is a glaring anomaly. We have good statistics on international trade, but not for the movement of people. We know that the world’s currency and investment markets are tightly linked, but we are only beginning to understand the complex dynamics of global labor markets. And the world has protocols and institutions for trade, finance, the environment, and weapons control — but not for movements of people.
This new reality creates difficulties for nations and international bodies. Governments are uncomfortable with people who cannot be neatly categorized as “citizens” or “aliens.” Laws regulating the labor market, benefits, health services, or military obligations lack flexibility. Countries to which migrants are attracted have concerns about security, social conflict, and the costs that come with a diverse population. Countries whose nationals migrate worry about losing talented people or seeing them exploited abroad. And international bodies do not have the authority or capacity to regulate the flow of people or settle conflicts between states. Without reliable data, they cannot even assess the situation accurately.
MacArthur’s initiative on migration and mobility addresses these shortcomings.
We begin with a set of principles:
We believe migration can benefit the countries people come from, those they go to, and the migrants themselves — the “triple win,” as this goal is sometimes called.
How do we get there? First, we need a better understanding of migration, more reliable data, and a study of the relationship between migration and development. Second, we must work in practical and incremental ways toward better governance.
First, information. There are plenty of open questions about the fundamental facts of migration. Some appear simple, but are not easy to answer: How many migrants are there? What do their journeys look like? How are patterns changing?
We are funding projects such as a Commission on International Migration Data for Development. Its goal is to encourage better statistics on migration, and better use of available data. We are underwriting a study of migration to and from Ghana, Morocco, the Democratic Republic of Congo, and Nigeria by the International Migration Institute at Oxford. And we fund the Latin American Migration Project at Princeton, which is providing detailed information on migration patterns and impacts across ten countries of South and Central America. Better data will help both researchers and policymakers.
Other issues are daunting in their complexity: How does migration contribute to economic growth? To international financial flows? What effects does it have on individuals and families? How are cultures, religions, ethnic identities, or patterns of public health changing as populations move? How does migration affect national politics and geopolitical dynamics?
Leading scholars are taking up these questions. Giovanni Peri, an economist we fund at the University of California-Davis, quantifies how immigrants boost the economies of countries they move to. He shows that immigrants help lower the cost of labor-intensive services, create incentives for native workers to specialize and upgrade skills, and allow them to move into better-paid jobs that require strong language competency. Overall, Peri shows, immigrants drive innovation and productivity, increasing the variety of goods and services.
We all know the term “brain drain.” When skilled people leave, their home nations lose out. But it is also true one of the most effective ways for a family in a developing country to raise its standard of living is to have one of its members move to a developed country and send money back to them in what are called “remittances.”
In 2008, about $300 billion in remittances were sent — more than twice as much as the all official foreign aid to developing nations. Unlike the top-heavy, sometimes misguided transfers of funds overseen by large international agencies such as the IMF or World Bank, individual remittances go directly to the people they are intended to help, paying for school fees, medical bills, and small businesses. And, even in the economic downturn, remittance rates have remained relatively constant, an important stabilizing factor in uncertain times.
The World Bank’s Dilip Ratha, a leading expert on remittances, showed that remittances around the world went up by about 8 percent last year. While foreign direct investment to Mexico dropped by more than 30 percent last year; remittances were down only 4 percent. Migrants send money home in good times and bad.
Remittances should be easy to send, not laden with high fees, and easy to redeem on the other side. And those who send the money like to know that it is being put to good use. In one MacArthur-supported study, researchers at the University of Michigan are working with Bank Agricola of El Salvador to test new financial products that give migrants greater control over how their remittances are used.
Migrants also help their countries of origin by stimulating others to invest there; spreading information about investment opportunities, building international networks, sharing technology. The growth of the IT industry in India is a good example. MacArthur is financing research at Harvard that examines how. And migrants can push positive change back home through what they learn in their new countries, leading to improvements in health care, education, human rights, or the use of technology.
But with all these positives, we know that migration also has negative effects on developing countries. It separates families, leaving children to be raised by grandparents. It can drain the most vital members away from struggling rural communities. And it may take the pressure off governments that fail to provide security or encourage economic growth.
Let me now move to my second point: Governance of migration. This is perhaps the key issue. Complex, highly sensitive, inherently transnational, migration policy presents a daunting prospect. Yet millions of people suffer for lack of systems of governance that are rational, transparent, or fair.
MacArthur’s governance work is aimed at three levels — global, regional, and bilateral.
At the global level, MacArthur is the leading nongovernmental supporter of the Global Forum on Migration and Development. The Forum emerged from a UN High-Level Dialogue held in September 2006 that raised, but did not resolve, important issues. It is an annual meeting of representatives from more than 150 governments around the world, who gather to explore common interests in a better system for migration.
The Forum is not a formal governance process. Participating countries do not commit themselves to binding agreements. But they share what has proved helpful, find ways to co-operate, discover areas of mutual interest in a politically neutral space. Common norms and standards can emerge.
Some issues: There need to be better ways for migrants to go back and forth (what is called temporary or “circular” migration.) Migrants should have more freedom in choosing which country will be their primary residence. They should be able to move their pensions and benefits. And they should not face onerous double taxation.
We do not expect to see a world body that will govern migration any time soon. But nations can work together to ensure that migrants are treated more fairly and migration becomes a safer, more positive experience.
Another key topic for the Forum is improving how migrant labor is recruited. The healthcare sector is a primary area of concern. MacArthur is the lead sponsor of a code of ethics for recruiting nurses to the United States from abroad. So far, 42 health-care organizations, nurses’ associations, and other stakeholders have signed on to this voluntary code of conduct, launched in September 2008. It requires transparent employment contracts and fair labor practices, and prohibits mistreatment, such as confiscating the passports of foreign nurses. With MacArthur funding, a similar global code is being prepared at the World Health Organization.
Until recently, the attitude of the United States had been an obstacle to the effectiveness of the Forum. The Bush administration believed that migration issues could not be discussed productively at the global level, and did not participate. But the Obama administration, advised by MacArthur grantees like the Migration Policy Institute, has reversed course and intends to be at next Forum in Athens this November.
The regional and bilateral levels are where the most concrete agreements on immigration take place, involving countries that share boundaries, economies, even security concerns. There are thirteen Regional Consultative Processes on migration in the world. Nearly every nation participates in one of them — from Asia, to southern Africa, to the former Soviet Union.
Particularly promising are cross-regional talks between the Persian Gulf states and the countries of South and Southeast Asia that supply hundreds of thousands of temporary workers to the Gulf. In January 2008, 20 countries signed the Abu Dhabi Declaration, which calls on both origin and destination nations to prevent illegal recruitment practices and put labor protections in place.
Eleven countries of North and Central America participate in Puebla Process, founded in 1996. Puebla meets annually, with a parallel nongovernmental gathering that represents the interests of migrants. It has led to a plan of action against human trafficking, progress toward common standards for travel documents, and country-level training programs for migration management.
MacArthur wants to see these regional processes live up to their promise. We are funding a project by the International Organization for Migration to gauge their effectiveness, and may invest in improving how they are run.
Some pairs of nations have close relationships, with large numbers of migrants from one living in the other. More than a million Algerians live in France, 1.5 million Turks in Germany, 4 million Bangladeshis in India. Russia has six million Ukrainians and Kazakhstanis, 12 million immigrants in all.
But by far the world’s largest migration pair — by a factor of three — is the Mexico and the U.S. There are more than 11 million Mexican immigrants in the United States, about 30 percent of the total immigrant population. Almost 7 million are undocumented.
Among the states, Illinois has the third largest Mexico-born population: 725 thousand — California has 4.4 million, and Texas 2.3 million. Seven-hundred thousand are in the Chicago region — 20 percent of the region’s population — and a similar percentage in the surrounding suburbs.
Mexico is Illinois’ largest trading partner. We have a strong stake in getting the U.S.-Mexico relationship right with regard to migration.
MacArthur is working toward that goal. We are supporting the Migration Policy Institute in Washington in bringing U.S. and Mexican officials together for discussions. We hope to restart an official dialogue on migration that began promisingly at the turn of the millennium, but was largely frozen after 9/11.
Key issues will include:
The labor market across North America is increasingly integrated. It is time to acknowledge that reality and find policies that make it work.
Less than three weeks ago, President Obama’s visit to Mexico gave cause for hope that the U.S.-Mexico relationship will improve — on migration as well as on the security issues that have captured the headlines. In his joint press conference with President Calderon, President Obama repeated his call for a path to legalization and at the same time for improving development in Mexico so that more Mexicans could choose not to emigrate. Here at home, the Obama administration has signaled that it will begin to tackle comprehensive immigration reform this year. So there are signs that we can move beyond a migration paradigm based principally on our national security interests to one that is broader and more complex.
Policies that turn away the best and brightest, from Mexico and other countries, will hamper our international competitiveness. After 9/11, visa restrictions markedly reduced the flow of foreign students and researchers to American universities. We need to encourage talented people to study and work, innovate, and build lives in this country, as so many have done in the past.
With the economic downturn has come a slowdown in global migration; countries as diverse as Spain, Japan, the Czech Republic are paying migrants to return home. The size of the immigrant population in the U.S. appears to have leveled off at 38 million. Some, in this country and elsewhere, are saying that migration is no longer a good idea. While understandable in hard times, this way of thinking is shortsighted and based on zero-sum economics. Immigration has a powerful, positive part to play in building national prosperity, and the movement of people will continue to be an integral part of the world economy.
What does MacArthur hope to achieve? Within a decade, we hope to see the perception of migration less negative, more aware of the benefits, based on strong empirical evidence. We hope to have helped researchers amass a reliable body of data that captures trends and allows for realistic analysis. We want to contribute to a strong, mutually beneficial, relationship between the U.S. and Mexico on migration. Around the world, we want to see a series of agreements that recognize migration as key to regional peace and prosperity, allow for freer movement, and further development so that people will move from choice, not necessity. And on the global level, we look toward a governance regime that will codify the rights of migrants, foster cooperation between countries of origin and destination, and maximize the development benefits of migration.
There is perhaps no more striking picture of the impact of global mobility than the tableau presented by our nation’s president, surrounded by members of his extended family, with all their ethnic and geographic diversity. This should remind us that migration is, ultimately, not about statistics, trends, or legislation. It is the sum of the trials, hopes, and dreams of millions of people moving to escape poverty or injustice, to find stability and prosperity for those they love, to develop more fully their potential as human beings. Their journeys must continue to fire our imagination and stir our best instincts of responsibility.
My time as President of MacArthur comes to an end in early July. It has been a great run, I have learned a lot and come away inspired by the courageous and talented people MacArthur is privileged to support.
Our new President, Robert Gallucci, shares the values and beliefs that animate our work at home and abroad. I like him, and you will too. He is eager to learn about Chicago and will maintain MacArthur’s commitment to our home town.
I will be on sabbatical for the last half of the year ready to return to the arena refreshed and ready for a new challenge in the New Year. In the meantime, I very much want to keep up with all of you and the interests we share.
Thank you for your attention, and I welcome your questions.