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MCALLEN, RGV – Deploying troops to the border and the associated increase in tensions harms the economy, according to analysis from The Perryman Group. 

Active-duty troops have begun to arrive in towns along the US-Mexico border to support border patrol personnel as a caravan of migrants fleeing abuses in Central America makes its way through Mexico. 

M. Ray Perryman

The Perryman Group points out that the caravan is hundreds of miles from the border and that it is estimated that only a small percentage will ultimately reach the US. Troops have been sent to the area on various occasions in the past, at times because of similar caravans, and such deployments have been shown to cause significant economic harms.

“The deployment increases feelings of uncertainty about the area’s stability and it could discourage business investment, tourism, and other desirable economic activity,” said Dr. Ray Perryman, president of The Perryman Group. “The presence of troops has historically impacted shoppers and employees in a variety of sectors, discouraging them from full participation in their normal activities.”

The Perryman Group (TPG) analyzed historical patterns during periods when troops were deployed and found that, even after adjusting for other factors, the border region, Texas, and US economies tend to be adversely affected during periods of deployment.

“Even when external factors and variations over time are considered, economic performance during deployments is worse than at other times,” Dr. Perryman said. “While having more people assigned to the area does lead to some increase in business activity, the overall net effect is clearly negative.”

The Perryman Group estimates that when multiplier effects are considered, costs to the US economy of deploying troops to the Lower Rio Grande Valley include almost $2.0 billion in total expenditures and $959.0 million in gross product per year of deployment, as well as 10,241 jobs due to weaker performance. These costs are above and beyond the direct expense to the US government of having the troops in the area. 

An estimated $1.7 billion of these annual total expenditures losses, over $859.1 million in annual gross product, and 9,538 of US job losses occur within Texas.

The total losses in the local Lower Rio Grande Valley area from weaker economic performance during deployments are estimated to be over $1.2 billion in total yearly expenditures, almost $706.9 million in gross product each year, and 8,647 jobs when multiplier effects are considered. The Lower Rio Grande Valley region includes Cameron, Hidalgo and Willacy counties in southern Texas.

According to Dr. Perryman, “The security of our borders is clearly an important issue, but it should be recognized that economic performance is dampened during times when troops are deployed and such measures should be reserved for severe and genuine threats. Less intrusive and more effective and appropriate measures are worthy of consideration.”

Editor’s Note: The main image accompanying the above guest column shows members of the U.S.military placing razor wire along the U.S.-Mexico border on the McAllen-Hidalgo International Bridge, Friday, Nov. 2, 2018, in McAllen, Texas. (AP Photo/Eric Gay)

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