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Money by wire, a way of life for immigrants everywhere
Keeble McFarlane
Saturday, December 15, 2007

AS the vibrant country known as the United States flexed its social and economic muscles in the nineteenth century, its population moved westward like the tide eating up the shore in a narrow, channelled bay.

Keeble McFarlane

The land was fertile and rich in resources and beckoned even more waves of immigrants both from the Old World and from the eastern reaches of the young country itself. While this population spread was taking place, something else was happening - an explosion of new forms of communication, fuelled by new ideas and inventions flooding out of the fertile brains of the inventors the new country nurtured.

Building on the foundation laid by dreamers and inventors in the British Isles, the Americans ran away with the concept of the steam engine, which morphed into the Iron Horse and stitched a new nation together.

The railway transported people, raw materials, manufactured goods, foodstuffs and new ways of thinking. Another kind of railway went along as the men of iron laid steel rails on wooden sleepers - from the Atlantic, over the Rocky Mountains, to the Pacific. This railway was made mostly of copper, and although by contrast with the substantial steel rails it consisted of slight, spindly wires, it played an equally robust role in opening up a continent and the world.

In 1861, the first trans-continental telegraph line was established, allowing practically instantaneous communication between the already established centres like New York, Boston and Philadelphia with the newer settlements in places such as Colorado, Oregon, Missouri and California. The entity which had the honour of doing this was the Western Union Telegraph Company, which became a huge telecommunications outfit foreshadowing the world as we know it today. The telegraph became the standard means of letting Uncle Thomas know you were arriving on the train from Chicago on Saturday evening, or advising your sister in St Louis of the death of your son in Camden, New Jersey.

Ten years after establishing the telegraph line it began transferring money by wire. How that worked is simple: the company established offices at both ends of the wire, and accepted payment from the sender at one end intended for a recipient at the other. When the authorisation came through the wire to the office at the other end, the people there released money from their stash to the designated payee. The sender paid a fee for the transaction, and Western Union made a bundle.

For well over a century, Western Union grew and prospered and played a huge part in the technological advances in the field of communication. In 1879, it ceded the telephone business to Bell after losing a legal fight over patents, but continued with a string of firsts - charge cards for customers in 1914, teletypewriters in 1923, the singing telegram in 1933, fax between cities in 1935 and microwave towers to replace long-distance wire connections in 1943. In 1974, it established its own fleet of telecommunications satellites, known as Westar to service its own Telex, telegraph and mailgram services, as well as leasing capacity to other companies, including the broadcast networks.

In the early 1990s, it also brought in the first pre-paid, disposable telephone card, which almost no foreign-based Jamaican goes without these days.

But the profits began to slump and the debts mounted, and the company sold off its communications assets, eventually becoming bankrupt in 1992. But a couple of years later it was bought by a group based in Colorado, and returned to the money-transfer business with emphasis on the international market. Today, it's the biggest in the trade, with some 320,000 locations in more than 200 countries and territories. And as anyone with relatives or associates in Atlanta, Fort Lauderdale, Toronto, London, Manchester, New York or Montreal can attest, it's very well represented in Jamaica - 100 locations, from Manchioneal to Bethel Town, Ocho Rios to Lionel Town, Yallahs to Clark's Town and Green Island to Port Antonio.

One of the things the company has to watch is the use of its services by narco-traffickers, terrorist organisations and international scam artists such as the notorious ones operating out of Nigeria. It employs a variety of techniques to make it difficult to move illegal money, and has to keep working at it to meet every new trick the rascals devise.

In recent years it has embarked on a huge campaign to revamp its image, which had been severely damaged by allegations that it was overcharging its customers. It sponsors a wide variety of community events all over the world - everything from concerts, festivals and sports events in conjunction with local immigrant bodies.

A couple of months ago, an immigrant group in Los Angeles organised a campaign to boycott Western Union and other money transfer services in an effort to get them to reduce their rates and to be brought under control by government financial watchdogs. In 1998, a lawyer from Chicago, Matthew Piers, filed a lawsuit against Western Union accusing it of disguising high fees by such devices as manipulating foreign exchange rates to its own advantage. The company denied it did anything wrong, but paid millions of dollars to settle the case.

The organisation which began rather modestly in 1851 as the New York and Mississippi Valley Printing Telegraph Company announced a decision on January 27, 2006 which would break the heart of any traditionalist: Western Union would no longer transmit telegrams, a service it had carried on for 155 years.

But never mind, the revitalised money-transfer business is very profitable, thank you. Last year, immigrants in wealthy countries used Western Union as the conduit to ship some US$300 billion to their relatives back home, whether it be the Philippines, Pakistan, Mexico or Guyana. In anybody's book, that's a lot of dough, and a lot of trust.


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