One river, one country

M C A L L E N, T E X A S,  A N D  M A T A M O R O S, M E X I C O

At the eastern end of America's border with Mexico, Americans and Mexicans live and work together

THE bumpy road to the Los Ebanos ferry winds through fields of sugar cane and spills out on to a leafy bend of the Rio Grande. It is a surprisingly small river, narrower than a couple of lengths of a smallish swimming pool, green, silted with pollution, sour-smelling in the heat. Yet it is also the cord that binds this region, called the Valley, together.

A rope-drawn ferry at Los Ebanos offers a return trip to Mexico for a dollar. In truth, though, it is no great feat to cross without it. After the lone Border Patrol agent goes home at supper time you can sit in the twilight and watch young men slipping into the water on the Mexican side, thrashing across in search of the American dream.

The border crossing at McAllen-Reynosa, to the east, is somewhat busier, with 12m crossings each year. The air there is acrid with the exhaust fumes of lorries waiting to clear customs and carloads of Texans heading to Mexico for a romantic dinner. Mexicans coming the other way flash their border-crossing cards (which are valid only for the Valley) and head for the mall in McAllen or for the homes of their cousins. Locals say the border is little more to them than a toll-bridge with an irritating queue. When a film opens a week early in McAllen, film buffs in Reynosa flock across the border for a sneak preview. Amid all the talk of border patrols and protectionism, it is easy to lose sight of the obvious. The Texas-Mexico border is porous. It is porous when it wants to be, in trade and traffic between the border towns; and when it does not want to be, in the unceasing flow of drugs, contraband and undocumented workers.

The lower Rio Grande valley is a country apart. Separated from the American and Mexican heartlands by a blazing furnace of desert, the Valley has developed a distinctive blend of cultures. Mexicans play baseball; Americans eat fajitas. Texan supermarkets operate in Mexico, Mexican companies build warehouses in Texas. The two countries remain distinct only in their earnings potential: a graduate engineer in Matamoros earns less than a shop assistant across the river in Brownsville. The scale of the present growth may be unprecedented, but the principle is old enough. After all, when the Union navy closed down Confederate ports in the civil war, Texans responded by exporting their cotton through Matamoros.

The Valley used to be an agricultural backwater, where children would rise with their parents and work the fields until dusk. When it rained, raw sewage would flood the dirt roads. Education was a luxury. Today, the Valley is a connected, dynamic, NAFTA-driven economy of 3m people (2m in Mexico, 1m in Texas) of whom 90% are Latino. The same children who worked the fields now attend college, work in high-tech maquiladoras, or serve the needs of the fast-growing supply, retail and tourist industries. A society of white landowners and Mexican peons has given way to an urban Latino middle class.

The 1982 peso devaluation crippled the Valley economy. By contrast, the 1994 devaluation barely slowed economic growth. The reason was a more diversified economy. Tourism, manufacturing, supply manufacturing and health care now complement agriculture. Retail sales in Texas cities bounced back strongly from the peso collapse, rising by $300m in 1996 to $5.5 billion. "Everyone's got a theme park. We ain't got a theme park," explained one Valley politician; "Mexico's our theme park."

It is more than that. The future growth of the Valley hangs less on under-age college boys in search of tequila than on maquiladoras which assemble duty-free materials with cheap Mexican labour into products for export back into the United States. In the developing world, only China has received more inward investment than the Mexican border region. It is not hard to see why. Maquiladora labour costs still average $7 a day. Reynosa now has 187 maquiladoras employing 42,000 workers. Matamoros has several industrial parks, including a large General Motors plant.

A visit to the maquiladoras banishes images of Dickensian sweatshops. Some companies even operate clean-room technology for delicate electronic manufacturing. Workers, as one manager points out, often enjoy better conditions at work than at home. Since the coming of NAFTA, foreign companies including BMW, Sony and Matsushita have set up maquiladoras in Reynosa and Matamoros. In turn, smaller supply companies have grown up in McAllen and Harlingen, where land is cheaper.

McAllen (slogan: "It's Naftastic!") is the third-fastest-growing city in the United States and one of the cheapest in which to do business. Despite a 7% job-growth rate, unemployment runs at 16%. The city has concentrated on education and infrastructure to improve its prospects. The South Texas Community College has grown from 600 to 6,000 students in three years, and the city offers to train employees for companies coming in. The Texas State Technical College in Harlingen serves a similar purpose. The University of Texas Pan-Am in Edinburg ("Taco-Tech"), has seen enrolment grow by 400% since 1987. The region's cities on the American side are fiercely competitive for federal dollars; there are, for example, five international airports in a 50-mile radius. But they are trying to work together. Recently, they have combined to try to attract major-league baseball clubs for spring training. Officials are co-operating to bring I-69, the proposed Montreal-Mexico City freeway, through the Valley, a case strengthened by the fact that the region remains the largest urban area in the United States without an interstate highway. There is talk of consolidating cities on both sides into a single metropolitan sprawl known as "Borderplex".

The darker side
For all the legitimate growth, it is impossible to ignore the presence of drugs. Even its boosters admit that the Valley economy is afloat with drug money; perhaps as much as $20 billion of it. Off the record, retailers confess that at least 15% of their sales are paid for with drug money. Few locals, of course, admit to knowing anything of the drug trade. "If it's here," says one businessman, "it exists in a dimension that does not affect the lives of most people." This may be true on the Texas side; it is less so in Mexico, where Garcia Abrego built up an implausible $1 billion fortune before his arrest last year in Matamoros.

The biggest problem, however, is more prosaic than the drug war. The Valley does not have enough water. The Rio Grande basin has suffered a four-year drought. The Falcon Dam reservoir is running low, and McAllen is in the second stage of an emergency water-conservation plan. Experts say the river cannot support the present level of use. If restrictions are tightened, farmers, who use 90% of the present water supply for irrigation, will be hardest-hit.

Agriculture is still the backbone of the Valley economy, and farm workers account for the peculiar settlement patterns. A small unmarked town can be home to 20,000 people because of the existence of colonias. These were originally shanty towns without power or water, the first (and often the last) step on the housing ladder for illegal immigrants. To drive through a colonia is, in effect, to be in Mexico. Many houses are still dilapidated; others have been upgraded haphazardly. As cities expand, they are being forced to incorporate and supply utilities to colonias, which has improved conditions a little; but local doctors fear that recent changes in eligibility for food stamps will inevitably lead to more widespread malnutrition. The nearest public hospital for children is in Galveston, eight hours away.

Mexican ambivalence about the environment, though improving, is still damaging the Rio Grande. Activists say Reynosa, in particular, is guilty of pumping raw sewage into the river. Ecology has become an important issue, not least because the Valley markets itself as an eco-tourist destination. Some 90,000 winter Texans&emdash;retired folk from the mid-west and Canada&emdash;put $230m a year directly into the local economy. Many encourage their old employers to set up in the Valley.

The western and eastern extremes of the Valley could not be more different. Roma, on the arid western fringe, resembles a town from a melancholy spaghetti western. Derelict buildings are trawled by Border Patrol agents. The town, 98% Spanish-speaking, has 27% unemployment, an average weekly wage of $253, and&emdash;apart from a smart new high school&emdash;no sign of any overspill from the growing economy down-river. South Padre Island, on the eastern seaboard, is rich and worldly. In Roma, farmers have difficulty making the payments for their second-hand pick-ups. In South Padre, residents pay for jet-skis with cash, and the skyline, thick with hotels, resembles Miami. Last year the island had 2.5m visitors, many of them wealthy Mexicans from Monterrey who filled Cameron County's tax coffers and provided traffic for the Valley airports.

Most of the region remains poor, closer to Roma than South Padre. Although the Mexican side is relatively affluent (compared with Chiapas), the Texan side has the highest birth rate, the lowest income per head and some of the highest unemployment rates in the United States. It remains parochial, dependent on welfare, and its image suffers from being on the front-line of the war against drugs and illegal immigration. Still, the economic advances of Latinos in the Valley add an instructive and optimistic note to America's racial debate. "This is the only place in America where Latinos feel at home, where they are in the majority," says Ivo Slavic, a professor at UT-PanAm. "There is no defensiveness. They are happy for what they are and quite unaware how small their world is."


© Copyright 1997 The Economist Newspaper Limited. All Rights Reserved