El Norte or Bust! How Migration Fever and Microcredit Produced a Financial Crash in a Latin American Town

In this unexpected story of a financial bubble and collapse, David Stoll puts a compelling human face on the global economic crisis. Tracing the desperate plight of Latin Americans moving north in search of higher wages, he argues that the most serious problem facing low-wage undocumented immigrants in the United States is debt. For the Mayas of Nebaj, an indigenous town in Guatemala that is running out of land, the biggest challenge is finding employment for their youth. Stoll considers the two strategies that emerged in the 1990s. The first, conceived by aid agencies, was to lend the locals money so that they could become entrepreneurs. The second, conceived by the Nebajenses, was to invest the loans in smuggling themselves to the United States. Remittances from immigrants meant prosperity for the lucky recipients but shock for everyone else. The price of land in Nebaj inflated so quickly that only families with a wage-earner in the United States could afford to buy it. More Nebajenses felt obliged to borrow the thousands needed for the high-risk journey. So many went north that, even before the U.S. liquidity crisis in 2008, they flooded the ethnic niches available to them. Not finding enough work meant defaulting on the loans that sent them North, with the result that migrants and their families are losing the land and homes they have pledged as collateral. As the experience of Nebaj demonstrates, migration streams to the United States have become a pyramid scheme in which migrants recoup their losses by transferring risk, and with it an increasing possibility of loss, to their relatives and neighbors. Ever-deepening debt, Stoll convincingly argues, is the powerful engine driving undocumented migration to the United States.