Do We Really Have to Go with the Flow? – The Reality behind Remittances

Op Ed

When I was an MA student at the University of Arkansas, I used to get calls every week from my friends in Morocco. “How much do you make a month?” they’d ask. I’d tell them, “1,300 US dollars.” This was the stipend I got from the Fulbright program.

“Wow!” they’d exclaim. “$1,300! You’re rich now!” 

These were the same friends who’d known me when I was homeless. They were aware that I’d lived for six years with no income, no shelter and often no food. Now, I was telling them that I made $1,300 every month. Naturally, it sounded like a lot, especially coming from someone like me.

However, there was something else going on, too. When I said $1,300, they were converting it to Moroccan dirhams, arriving at a sum about 10 times as high. Then they were comparing that to what they were making. “Please,” they’d tell me, “I’m trying to buy a house. I need a new car. I’m starting a company. My wedding is next month. I need you to send me just $500. It won’t cost you anything!”

I’d done the same calculations when I lived in Morocco, so I understood them when they asked me for money. Instead, I tried to explain the reality of my situation. “I make $1,300 a month,” I’d tell them, “but then I spend $600 on rent, $200 on utilities and $400 on groceries. That leaves me with $100, which I usually spend on books or transportation.” Even if I were to send that $100 every month, I would add, they wouldn’t receive the full $100 because the bank deducts a service fee for money transfers.

I explained this again and again, but my friends just kept asking.

When I didn’t send money, some of those relationships faded away on their own. Others were extremely important to me. For years, I did my best to keep those people in my life, sending whatever I had, even when it meant that I couldn’t buy groceries. Sometimes, I went for weeks eating nothing but baked potatoes. I even went into debt it the States, trying to send money back to Morocco. What I sent was never enough. Eventually, I had to let all those relationships go.

In a way, I’ve been lucky. My family abused and then rejected me, and I had to struggle to survive and educate myself with no one to support me. For years, I was traumatized and lonely and full of self-pity, but when I came to the United States, I realized there’s another side to not having family: I don’t have any relatives expecting me to send them money. I hated to lose my friends, but in the end, none of those ties was so strong that it couldn’t be severed.

I don’t know if all immigrants share this experience because I haven’t personally met every immigrant, but almost all the ones I know have told me similar stories.

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Once, before the pandemic, I went to Walmart with my friend Jamila, an international student from Pakistan. When we reached the pharmacy aisle, she murmured, “Wow…I really wish I could get just one of these deodorants.”

I was startled. Even I could afford deodorant! “But they’re very cheap!” I said, maybe a little tactlessly. I was studying journalism, after all, not counseling.

Jamila broke down right there in the aisle, next to the electric toothbrushes. She launched into a stream-of-consciousness explanation: “I’m a graduate student assistant, I get $700 a month, I have to send $400 back to my family; if I don’t, I’ll lose all those relationships. I’ll lose my parents, siblings, aunts, uncles and cousins–even their friends and friends of friends. Every month, I have to send it!”

That got me thinking about how I’m actually lucky. It also prompted me to do some research.

From the Migration Policy Institute, a US-based nonpartisan think-tank, I learned that “Remittances [money sent by individuals to their families or friends in their home countries] are among the most tangible links between migration and development. They are larger than foreign direct investment and official development assistance received by low-and middle-income countries.”

According to Niall McCarthy, writing for Forbes in 2019, immigrants in the US sent home approximately $148 billion in 2017. This isn’t just a North American phenomenon, either. McCarthy also cites the PEW Research Center, which estimated that total global remittances, mostly from wealthy countries to poorer ones, tallied $625 billion that same year, a 7% increase from 2016.

Estimating remittances isn’t an exact science, as the money’s often sent in cash or by other underground channels. If anything, those numbers are probably undercounts.

When I lived in Morocco, I thought that earning $1,300 in the US makes you rich. Likewise, if you were born in the United States and have never met immigrants or studied these issues, you might not know how damaging the culture of remittances can be, both financially and emotionally. You’ve probably seen stories in the media about migrants who come to the US, work low-wage jobs for a few years, send home a portion of their earnings and, thanks to the strength of the US dollar, make their families and communities incredibly wealthy. Maybe they finance the construction of a house, or start their own business with seed money earned from mopping floors at Taco Bell. I’m not saying this never happens. I’m just saying that in the real world, the story’s a lot more complicated, and most of that story isn’t getting told.  

When the COVID-19 pandemic began, experts around the world expressed concerns that it would interrupt remittance flows. Leaders in banks, national capitals and aid organizations worried openly about the impact this would have on different countries’ economies–and not without reason. As Danny Bahar recently wrote for the Brookings Institute, “Remittances…are a crucial source of income for many countries, representing over 20 percent of the GDP in nations such as Tonga, Tajikistan, Haiti, Honduras, and El Salvador, among others.” 20% of your GDP is a lot to lose, especially if your economy’s already small.

However, as the International Monetary Fund (IMF) pointed out in their 2021 working paper “Defying the Odds: Remittances During the COVID-19 Pandemic,” remittance flows have proven surprisingly resilient in the face of COVID and a global recession. This sounds like good news on paper. However, it got me thinking about what those resilient remittance flows are doing to individuals. I started asking around and uncovered some ugly truths.

My friend Sarah was born in America, but her husband’s from Eastern Europe. They got married just before the pandemic. As of April 2022, her husband’s green card application is still pending. “I’m a student,” she told me when we talked, “and he’s working part-time. We couldn’t send money–there’s nothing to send! But his family assumes we had plenty of money, and I just wouldn’t let him send it. Now they won’t speak to either of us. He’s completely isolated from his loved ones. It’s putting a strain on our marriage.”

My friends from abroad who’ve married Americans aren’t faring any better. Ali and his wife have been married for 10 years and now have two children. “She converted to Islam,” he explained. “We lived for six years in my country. She learned how to cook and speak Egyptian until you wouldn’t know she wasn’t born there.” Now, they live in the United States, but since the pandemic hit, they’ve been struggling financially. “Many of my brothers and cousins back home were laid off,” he told me. “I send them half my income, but that doesn’t leave enough for us. I’ve stopped buying toys and sweets for our kids. My wife and I fight every day. If this keep going, I’m afraid that our marriage might end in divorce.”

Gabriella, from El Salvador, spent years traveling the world and working in different countries with her American husband before settling down in the States. In the past, they’d run charity organizations, so people around the world knew them not just as friends, but also as sources of income.

“Now,” she told me, “because I’ve married an American, they think I have an endless supply of US dollars.” In reality, her husband’s from a lower-middle-class family, and they haven’t supported him financially since he was 18. “I’m not working now because of the pandemic,” Gabriella told me. “I can’t even send money to family and close friends, much less all these people who worked for us back when we lived in their countries. We’ve lost a lot of relationships. It makes me feel like they were never really friends in the first place. They were just using us.”

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Moira, from South Africa, also has an American husband. “He’s very generous,” she told me. “He wants to send money to everyone. We just don’t have any. I’ve had to stop telling him when people reach out to me asking for money because he would send it, and then we’d end up homeless in America.”

I’ve spoken with people who’ve taken second or third jobs during the pandemic to keep the keep the remittances flowing. I’ve heard many stories of marriages falling apart. I know countless people who’ve lost their jobs because of COVID, but still have to send money back to their home countries. I guess they’re all doing what I once did, living on baked potatoes.

When I did some more digging, I realized that even the rich people aren’t doing well. A few weeks ago, my friend Aisha called me from Walmart. “I’m so stressed right now,” she told me from the electronics aisle, nearly in tears. Aisha’s from Algeria, and her family is extremely wealthy. They sent her to the US to continue her education. Sometimes they send her money, but the exchange rate reduces whatever they send. To support herself, Aisha’s taken a job at the university. “They don’t understand why I’m working,” she told me. “I’ve tried to explain that rent and food are too expensive, but they always think I’m joking. They think I’m just having fun.”

Every time she visits Algeria, Aisha’s expected to bring home expensive gifts–iPads, iPhones, headphones, etc.–for her parents, aunts, uncles, family friends and even neighbors and their children. “I’m serious,” she told me. “I’ve packed six suitcases, and I don’t even have room for my own things! All the money I’ve made this year is in those suitcases. I don’t know how I’ll pay rent once I’m back.”

Most high-profile economists seem to be thrilled that remittance flows have proven so resilient. Their reports aren’t telling the whole story. Neither is the American media, which loves to talk about how strong the US dollar is, and how many Toyotas a day’s wages from Hooters can purchase in Haiti or Bangladesh, but not about the strain this puts on individuals and their relationships with one another.

This is a big problem, but it’s not just a problem with economists, journalists, or even the wealthy Western world. It’s human nature to cherry-pick the facts that best support our worldviews and leave the rest to rot on the tree. When I tried to explain to my friends in Morocco that my rent, utility and grocery bills completely cancelled out my earnings, they didn’t understand. It wasn’t just that they didn’t believe me; steeped in ideologies, they literally couldn’t process the information. Even when I did the math and proved that what they were requesting was 90 percent of my income, it didn’t compute.

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Everyone I’ve interviewed has reported the same thing, without exception. Whether we’re from wealthy countries or from poor ones, it seems that we’re all suffering under the same ideology: that living in a wealthy country means you’re personally wealthy and can afford to share with everyone you know. The reality’s a lot more complicated. Not all immigrants are poor, but even wealthy immigrants, when they come to the US, often end up living paycheck-to-paycheck. That financial insecurity is bad enough, but it gets 10 times worse when compounded by the social strain that expectations impose.

I decided to write this because no one other journalists are talking about this phenomenon, widespread though it is. If you’re reading this, regardless of your personal circumstances or where you are in the world, please try to remember this: living in a wealthy country doesn’t necessarily make you wealthy. Even coming from a wealthy family doesn’t necessarily mean you’re comfortable, or that you have plenty to spare. Socioeconomics are complicated, and they get even more complicated when you mix them with immigration. So, if you know someone with family or friends abroad and they seem to be struggling, remember to cut them some slack. The pressure to keep those remittances flowing is probably hurting them more than you know.

Founder and Former President of Fulbrighters with Disabilities

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