Republicans face one of the trickiest political problems they have faced as a party since Clinton pre-empted their program through triangulation and left them temporarily devoid of issues.

As the number of illegal immigrants mounts in the United States, the demands of the party’s nativist constituency for tighter border controls and immigration enforcement threatens to put it at odds with America’s rapidly growing Hispanic population, dooming the GOP to possible minority status not just in California and New York but in Texas and Florida as well.

The push-pull between Hispanic demands for respect and nativist concerns about job loss, crime, education costs and urban crowding, all exacerbated by illegal immigration, poses a huge problem for party leaders.

The obvious answer to demands for limits on immigration is the border fence passed by the House and pending in the Senate. Slated to extend over 700 miles of the U.S.-Mexico border at a cost upwards of $2 billion, the barrier, coupled with increased enforcement manpower and effective employer sanctions, will likely give the United States a means to control population inflows. But what of the economic, moral, foreign-policy and political issues a fence will raise?

Economically, Mexican illegal immigrants are not in search of welfare but come looking for work. That they find it is obvious. Otherwise how could they send $11 billion a year home to their families and why would they come in increasing numbers?

Clearly the American economy needs their services. On a micro-economic level, they do jobs Americans don’t want at wages below what we would consider acceptable – and perhaps below those that are legal as well. On a macro level, their presence holds down labor costs and permits the Federal Reserve to take more chances with low interest rates than it could in an inflationary-wage market.

The obvious answer to these concerns is a grand bargain that couples the strictest border defense with a generous guest-worker program, granting legal status to Mexican immigrants and regulating their numbers, working conditions, and wages – and assuring that they contribute to Social Security and other taxes.

The foreign-policy implications of a fence are harder to handle. Already Latin resentment against the United States is fueling the rise of an oil- and cocaine-based leftist oligarchy throughout our hemisphere. Castro now has friends in power in Venezuela and Bolivia and moderate allies in Brazil, Uruguay and Argentina. In Peru, a leftist Chavez look-alike, Ollanta Humala, is leading in the presidential race. In Nicaragua, Daniel Ortega may be heading back to power by a gradual military coup. And in Mexico itself, a Chavez prot/g/, Andr/s Manuel Lpez Obrador, is leading in the polls for the July 2006 presidential race. Can you imagine having a border with a Chavez or a Castro, whose ability to disregard American concerns would be underscored by massive oil reserves?

But it is in the realm of domestic politics that the GOP would pay the highest price for a purely nativist policy. Texas has now become a majority-minority state, joining California. Can its wholesale flip to the Democratic Party be far behind? Not if the Republicans are seen as an anti-Hispanic party! Is the GOP really willing to make political war against the Latinos by rubbing their noses in a border fence when they now account for 14 percent of the population and will probably increase their share to 18 percent over the next 10 years?

The permanent political price the Republican Party would pay for this shortsightedness is reminiscent of the way it antagonized the African-American vote in the ’60s. Remember that Dwight Eisenhower carried blacks in 1952 and 1956. John F. Kennedy only narrowly prevailed in the black community. It was not until Barry Goldwater and Richard Nixon, pursuing the Southern strategy at all costs, drove blacks into the arms of the Democrats that their votes were irretrievably lost. Is the GOP, driven by the anger of its base, going to make Hispanics permanent Democrats?

By moving away from English-only policies and reaching out to Hispanics, Bush has closed the gap among Latino voters. Gore carried them by 30 points, but Kerry only won among them by 10. But the border backlash may be undoing all this good work.

The obvious answer is to couple a fence with a good guest-worker program, with a citizenship track predicated on good behavior. But if the Republican Party allows the House bill to become law – a fence with no guest-worker program – it will be antagonize the vital Latino vote and consign itself to permanent minority status.

-Dick Morris was an adviser to Bill Clinton for 20 years.