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The Dirty Economics of Human Trafficking

The Dirty Economics of Human Trafficking

Human trafficking is generating an estimated $32 billion dollars annually. This same number comes up repeatedly in human trafficking statistics, but where is this $32 billion dollars going and more importantly, how is the crime of human trafficking affecting the world economy?
Huge Profits
In a report by the International Labor Organization, the $32 billion dollars lines the pockets of traffickers and unscrupulous employees every year. In the lucrative industry of human trafficking, more people than just the traffickers are profiting. The “unscrupulous employees” the ILO report refers to serve as a type of middleman who procure the victims, provide transportation and fake documents and who also get a cut of the profit. To put it in perspective, a trafficker can make anywhere from $4,000-50,000 per trafficked person depending on the victim’s place of origin and destination. This is an enormous sum and for victims of sex slavery once they reach their destination, they will be sold repeatedly for an average of $90 per slave.

Individual Traffickers
In his book “Illicit,” Moises Naim explains that “Throughout the twentieth century, to the extent that governments paid attention to illicit trade at all, they framed it — to their public, and to themselves — as the work of criminal organizations…Only recently has this mindset began to shift.” In the past, the term “trafficking” has mainly been used for illicit goods such as drugs and weapons–both markets that have traditionally been controlled by organized crime rings. While organized crime continues to control the majority of human trafficking profits, small time traffickers can not be discounted as they can make large amounts of money without having to exploit more than a few people. Louise Shelley, professor and human trafficking expert reported that some of the most profitable traffickers are in fact individuals, including the Latino Brothel Case in Montgomery County, Maryland which generated $1 million annually. Shelley is also quick to point out that trafficking does not always take place on a large scale and points to the case of two Uzbek University of Texas researchers who generated $400,000 from two girls in just 18 months.

Global Economic Outcomes
Besides the huge loss of domestic jobs, and human labor, human trafficking negatively impacts the world economy in other ways. The largest problem is the loss of remittances to developing countries since trafficked persons are usually either deprived of wages or told they have a large “debt” to pay back to the traffickers. The Department of State Trafficking in Persons Report estimates that the level of annual remittances to developing countries is $325 billion. Lack of remittance can have a devastating impact on countries such as Zimbabwe, Haiti, Dominican Republic, Moldova and the Philippines where 23-40 percent of the population depend on receiving money from abroad. The next issue stems from child labor and commercial sexual exploitation of children which renders entire generations of adults useless in the workforce due to severe trauma and illness from years of abuse. The abused children turn into traumatized adults who depend on the government welfare systems to survive. Finally, if human trafficking successfully ended, than the money spent by governments, international organizations and NGOs could be used to support other social welfare programs