Who’s Driving Chaos at the Border?

Getting less attention but equally pernicious is the administration’s failure to make development in Latin America a priority. Absent growth in poor countries, the U.S. and its corresponding wage differentials will continue to act as a magnet for the ambitious.

This is not to suggest that the dictatorships of Venezuela, Nicaragua and Cuba are about to become destinations for capital. But plenty of democracies in the neighborhood are natural fits for investors who seek to shift production from China. The U.S. can’t mandate a pro-growth agenda in these countries, but it can certainly play a supporting role.

Sens.

Bill Hagerty

(R., Tenn.) and

Ben Cardin

(D., Md.) made the point in an Oct. 13 letter to Secretary of State

Antony Blinken.

“Nearshoring opportunities increasingly abound for Honduras and other countries in Central America” and could “provide new employment opportunities for talented young Hondurans,” the senators wrote. One problem: “The Honduran government is advancing policies and actions that are inconsistent with this promising future.”

That senators on both sides of the aisle feel the need to explain to Mr. Biden’s diplomatic team that Honduras is acting in bad faith doesn’t speak well of the administration. Wasn’t Vice President

Kamala Harris

supposed to uncover the root causes of migration?

Title 42—which allows the U.S. to refuse migrant entry for public-health reasons—will now be used to return Venezuelans seeking asylum to Mexico. Reuters reported last week that tens of thousands who were betting on President Biden’s open-border policy are now “stranded” in Central America and Mexico.

Ariel Ruiz Soto’s

October paper for the Migration Policy Institute pointed out that because Title 42 expulsions don’t carry immigration charges—such as criminal prosecution for illegal entry or reentry—its use “has stoked a significant churn of Mexican encounters, and the new DHS policy likely will result in increased attempts by Venezuelans to enter irregularly.”

As if to solve this problem, the U.S. also announced a new online program that will offer 24,000 visas annually to Venezuelan applicants. Given that an estimated 6.8 million Venezuelans have fled the country since 2014, this sounds like a bad joke. Never mind the human capital in the rest of the Americas looking for a way out of grim circumstances.

Mr.

Ruiz Soto

notes that “migrants’ top five countries of origin were Mexico, Guatemala, Honduras, Cuba, and Venezuela, together comprising 71 percent of all encounters between ports of entry in [fiscal] 2022.”

The inclusion of tiny Honduras—with fewer than 11 million inhabitants—in this group is a puzzle. Until, that is, one examines its government’s efforts to destroy job-creating investment.

The Honduran Congress passed a constitutional amendment and a law in 2013 to allow for the creation of Economic Development and Employment Zones, or ZEDEs, a variation on the idea of charter cities like Hong Kong. These special zones have administrative autonomy that can offer businesses and residents judicial certainty, a light regulatory touch, low taxes, education and public security.

There is now roughly $100 million invested in three ZEDE projects. Much more is committed. Yet hard-left President

Xiomara Castro

and her Libre party are actively threatening the 50-year legal guarantee of the existing ZEDEs, and Congress has passed legislation to prohibit new ones.

Ms. Castro’s husband is

Manuel Zelaya,

who was an ally of Venezuela’s

Hugo Chávez.

In their letter, Sens. Hagerty and Cardin stress the importance of the rule of law to development and express alarm about the “tone and content” of Ms. Castro’s September address to the United Nations. They also note with concern “a large U.S.-based company’s announcement on September 27 that it is closing one of its major facilities in Honduras.” They don’t name the company but it’s likely that they are referring to

HanesBrands Inc.