Wednesday, May 11, 2005

The politics and economics of illegal immigration

You've got to be taught
To hate and fear,
You've got to be taught
From year to year,
It's got to be drummed
In your dear little ear
You've got to be carefully taught

You've got to be taught to be afraid
Of people whose eyes are oddly made,
And people whose skin is a diff'rent shade,
You've got to be carefully taught
I believe few Americans are truly racist and "hate" foreigners. I believe, though, that many embody this Rogers and Hammerstein "South Pacific" song: they fear foreigners. Sometimes it's not a conscious fear, but, as an example, there is much unfounded fear of the mythical immigrant who "steals" a job from an "American."

Some, like Pat Buchanan, believe we need an electrified fence all along the U.S.-Mexico border to keep "Jose" out. My friend Steve Tomer recently proposed some severe immigration restrictions. Steve is one of my oldest friends, and I will personally vouch for him as a good guy. He isn't racist, he doesn't hate foreigners, and he doesn't fear them. But he recognizes a lot of problems stemming from illegal immigration.

"You...have personally...vouched?" (Inside joke.)

There's even been conflict recently between conservatives and conservatives on the Minutemen. I frowned as I saw Michelle Malkin basically accuse Professor Bainbridge of not being rational and even "nutty." Personally I think there's merit to both sides, and perhaps both sides didn't realize what the other was saying. Ms. Malkin sees the Minutemen as necessary to deter illegal immigration and its resultant problems, and the professor looked at the Minutemen from the perspective of law.

Undeniably, unchecked illegal immigration has engendered serious problems, such as crime, illegals taking advantage of our social services, even Muslim terrorists trying to sneak in. So I for one am glad to see citizen activists like the Minutemen. They've infringed on no one's rights but at the least have deterred a lot of drug traffickers. (This is a topic for another day, but I think "vigilante" citizenry can be necessary when government won't or can't enforce the law.) At the same time, however, shouldn't we make it easier for law-abiding immigrants to enter the U.S.? Secure the borders except at the various points of entry. Ease the restrictions on legal immigration, and the peaceful ones will realize it's safer (and cheaper) to immigrate legally. The drug dealers and other criminals will still try to cross illegally. If any immigrant, legal or not, is convicted of a crime, then we apply the full force of the law -- and deport permanently after the sentence is completed.

I had been thinking to blog about illegal immigration but never got around to it. Then I was inspired this morning by John Gambling's WABC radio show, which discussed it with featured guest Daniel Griswold of Cato. John and a few callers didn't buy Griswold's libertarian arguments, but Griswold was absolutely right to point out that illegal immigrants don't "steal" jobs, nor will total employment really go down when Americans take those jobs previously done by illegal immigrants. (The same applies to legal immigrants.)

Griswold countered the myth, "Illegal immigrants take the jobs Americans won't." I add that that's an oversimplification and not quite true. They do take low-grade jobs, like janitorial services and produce picking, that Americans would prefer not to take. It's more accurate to say that illegal immigrants take low-grade jobs at pay rates that Americans won't accept. And believe it or not, every American does benefit economically from that.

One caller used the example of an illegal immigrant who will paint for $60 a day versus a citizen or legal resident who would want $150. Well, what does he think will happen when someone has to pay $150 instead of $60? Griswold correctly said that it will reduce the demand for that particular service. Though all painters will now make $150, fewer people will want to hire them at that higher rate. Thus some painters will find themselves not working at all, just like when illegal immigrants supposedly "steal" their jobs. It evens out. Perhaps not with the same people, but it will overall.

Bastiat's criterium for determining the worth of an economist is, "There is only one difference between a bad economist and a good one: the bad economist confines himself to the visible effect; the good economist takes into account both the effect that can be seen and those effects that must be foreseen." I judge that Griswold is a good economist. He looks beyond the visible effect of a citizen or legal resident having a new job; he considers what would happen to the demand curve for painters' services.

My own addition is that the person hiring a "legal" painter at $150, instead of $60, now has $90 less to spend elsewhere (or save). As Bastiat would say (ibid), don't you see that it's only a transfer of consumption? Yes, a citizen (or legal resident) will have a new job, but only at the expense of another person who is no longer working (or others who, between them, are now selling $90 less of goods and services). It may not even out among painters, but it will across the entire economy. It is a zero-sum game.

Surprisingly, no one , not Griswold, Gambling or the callers, discussed the massive illegal immigrant labor that picks fruit and vegetables in Southern California. Oftentimes the illegals do it for $2 an hour, and though they're being "exploited illegally" under the law, they far prefer it to making only 20 cents a day back home. Meanwhile, many Americans complain about illegal immigrants, ignorant that illegal immigrant labor is what keeps southern California produce inexpensive. Even if there were Americans who'd take that job at minimum wage, consumers would pay higher prices.

Then there are people aware of the low wages who decry that illegals don't pay taxes like the rest of us. They're already working for less than half of the federal minimum wage -- isn't that bad enough? Well, all right, let's tax them. We'll make them pay Social Security and Medicare taxes, too, and make their employers make matching contributions. The employers will have to raise prices to cover that, naturally, which is passed along to consumers. So is taxing illegal immigrant labor such a good idea after all?

Still, I cannot advocate open borders as I once did. We've encountered a new problem in the last few years, though it's not economic. It has nothing to do with lost jobs or lost taxes. As I've said before, September 11th changed everything. Previously I've also mentioned that Michelle Malkin and others discuss the Muslim terrorists trying to enter the U.S. through our southern border. This is why I now support fully monitored immigration, but still very open immigration.

Will no less than the highest respect to Ms. Malkin, she should be grateful that the U.S. was free enough to allow her family to immigrate. (I believe it was her parents, but I do know she was born here.) My family in the Philippines, even before 9/11, can't get so much as a tourist visa. One of my uncles does come every so often on a work visa to earn some money, but only because he had spent time visiting our family in England (apparently that did wonders to reduce his risk rating). But the rest of my family is perpetually denied. We've talked to every bureaucrat possible, and my aunt once solicited help from Senator Moynihan's office. Every answer was the same: the U.S. embassy in the Philippines was simply refusing to approve the visa applications, and nobody could do anything about it. Then 9/11 happened, and it's now effectively impossible to get them visas.

Again, it's undeniable that a lot of illegal immigrants take advantage of our welfare services. I understand that California's state government spends about $2 billion per year on illegal immigrants, in one form or another; not all is on social services for them, but a lot is. Now there's a new federal spending bill to give $1 billion to Texas hospitals just for treating illegal immigrants, because their emergency rooms cannot refuse services to anyone.

My own anecdote is from the Morgan Stanley branch where I worked. We frequently received calls for Florida Medicaid because the two offices have the same phone number, except that one is toll-free 800, and the other is a Florida area code. Most calls for Medicaid were people asking about prescriptions and overrides, but there were occasional callers who spoke only Spanish. They couldn't converse at all in English, but they certainly knew what Medicaid is!

There's a fairly simple solution. My father believed that government benefits should go to citizens only. I'll go further: end the welfare state for everybody. If we did, the only people immigrating into the U.S. would be the honest ones who simply want to work and find better lives. We'd also have the side benefit of lower taxes, meaning we'd have more money to spend -- like on things immigrants make.

I don't believe in driver's licenses for illegal immigrants. It's too much of a government sanction for people who violated our immigration laws. But I would support state identification cards issued when they cross the border legally and register.

There's a song I didn't understand when I was little, but it now stirs something inside of me. It's a song about people who want freedom.

Far, we've been traveling far
Without a home, but not without a star
Free, only want to be free
We huddle close, hang on to a dream
On the boats and on the planes
They're coming to America
Never looking back again
They're coming to America
Home, don't it seem so far away
Oh, we're traveling light today
In the eye of the storm, in the eye of the storm
Home, to a new and a shiny place
Make our bed, and we'll say our grace
Freedom's light burning warm
Freedom's light burning warm
Everywhere around the world
They're coming to America
Every time that flag's unfurled
They're coming to America
Got a dream to take them there
They're coming to America
Got a dream they've cometo share
They're coming to America
They're coming to America
They're coming to America
They're coming to America
They're coming to America
Today, today, today, today, today
My country 'tis of thee
[Today]
Sweet land of liberty
[Today]
Of thee I sing
[Today]
Of thee I sing
Today
Lincoln said, "Those who deny freedom to others deserve it not for themselves; and, under a just God, cannot long retain it." We're not explicitly denying freedom to illegal immigrants, but shouldn't we be more welcoming to those who simply seek a better life? Is there such a difference between Haitian refugees and Cuban dissidents? I'm not talking about any criminal element, or those seeking to come here and live off our welfare systems. I'm talking about people who want a slice of the American dream, people who are willing to work hard, and people who want to live honestly.

It's an awfully big pie, and I always thought there's plenty of room at the table.
Give me your tired, your poor,
Your huddled masses yearning to breathe free,
The wretched refuse of your teeming shore,
Send these, the homeless, tempest-tost to me,
I lift my lamp beside the golden door!
It's a cliché to quote Lady Liberty's inscription, but a poignant one.

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3 Comments:

Blogger anomdebus said...

I was thinking along similar lines this morning and just want to leave a small thought.
One other thing that is not seen with regard to cheap illegal labor is that it reduces the incentive to create cheaper ways to harvest crops. Hence, the illegal labor props up low paying jobs.
Even lawn care, having illegals maintain lawns at an otherwise depressed rate subsidises poor choices of ground cover because the cost is artificially reduced.
I am not saying that either of these is an end in themselves, just another effect.

Wednesday, May 11, 2005 12:21:00 PM  
Blogger HispanicPundit said...

Great blog, great post.

Saturday, August 27, 2005 1:59:00 AM  
Blogger pmork said...

Great post. Here are a few letters to the editor over at my site that are along the same lines:

WSJ:

http://www.economicswithaface.com/Essays/WSJ032404.pdf

San Diego Union Tribune:

http://www.economicswithaface.com/Essays/ImmigrationBush022005.pdf

Friday, September 30, 2005 2:12:00 PM  

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