Wednesday, March 29, 2006

More on the true economics of illegal immigration

When conservatives don't get it about illegal immigration
Price-setting and illegal immigration
The politics and economics of illegal immigration

The very purpose of labor unions is to protect their members from competition, particularly immigrants (legal and otherwise) who will do the same work for less. So as expected, the AFL-CIO today came out strongly against the "guest worker" program now working its way through Congress. It announced it would oppose such "reform" last month, which still did not dissuade certain Democrats from embracing "guest worker" status.

While we might think this spells trouble for Democrats, who depend on union money as much (if not more) than union voter turnout, unions really have little choice but to endure the strained marriage. In all likelihood, albeit reluctantly, they still will give money and votes to Democratic candidates. Who will they otherwise support, Republicans? Green Party candidates or other socialists with no hope of winning? It was a calculated move by the Democrats, and arguably a good one. Democrats know labor unions won't abandon them just for this, and meanwhile, advocating a "guest worker" program will secure much of the Hispanic vote (critical because "even" George W. Bush made large gains among Hispanic voters in the 2004 election). Especially to make a move in 2006 and 2008, Democrats can't take minority voters for granted. Hillary has now emphasized she's pro-immigrant, hoping Hispanics she started to alienate will forget her previous tough talk on securing the southern border.

But immigrants don't just do the jobs Americans won't do. They do the jobs Americans shouldn't do, as I explained in my entry on when conservatives don't get it about illegal immigration. Any economy, no matter how advanced, will have jobs that "somebody's gotta do." A household isn't as simplistic a representation as it might initially seem. Like the low-grade jobs in a sizeable economy that we'd prefer not to do, there are chores to be done like vacuuming carpets, cleaning bathrooms and yardwork. But why should a parent have a skilled son mow the lawn, when he could earn $10 an hour elsewhere, and an immigrant is willing to cut the grass for $5? It's win-win for everyone. So what opponents of immigrant labor are arguing is the most absurd facet of protectionism: that the hired worker "takes away" the son's low-grade job, when in fact the son could do so much better.

Immigrants, legal and not, tend to replace Americans in low-grade jobs. That means Americans no longer have to mow lawns, bus tables, mop floors, or do construction. Instead, we can go into drafting, IT, accounting/finance, and so on. In other words, immigrants easily fill the demand for low-grade labor, allowing more Americans to go into high-grade occupations. It's a rare case that white-collar professionals lose their jobs to illegal immigrants, but that's not the type of illegal immigrant that conservatives fear.

Michelle Malkin recently hailed a reader's comment as "E-mail of the day," which it was, but for an entirely different reason. It was a complete non sequitur. The person criticized Bush for using the "jobs Americans won't do" phrase, bringing up "West Virginia miners." Yes, and...? Are certain conservatives so desperate for anti-illegal immigration talking points that they'll seize upon any argument or example, no matter how illogical? Miners aren't an occupation commonly (if at all) "threatened" by illegal immigrant labor, so I fail to see any relevance here. If anything, Americans should want illegal immigrants to take those jobs, so that we can go into white-collar jobs with a greatly smaller risk of death.

One thing I have wondered is why construction workers are so protective of their jobs. Now, I admit the most physical labor I've ever done is carting several monitors around, back in my IT days. Still, I would think people would prefer to type on a keyboard inside an air-conditioned office, instead of sweating out in the sun and risking serious injury. If the construction workers aren't intelligent enough to improve themselves and get the better jobs, then that's direct evidence of their protectionism. They can't compete with others who will do the same work (perhaps better) for less, so they appeal to the power of government to make themselves artificially competitive. As I'll explain later, that infringes on my freedom to choose.

The substitution of illegal immigrant labor in low-grade jobs is no different than the controversy of "jobs exported overseas." China and India use their comparative advantage in labor to produce labor-intensive goods, which allows more American workers to move into jobs that produce capital-intensive goods. Americans shouldn't bother making inexpensive plastic or metal parts, or mass-producing semiconductors, not when we can produce Boeing jets, Caterpillars and high-level computer software. The Chinese and Indians could probably make whole aircraft, heavy construction machinery and computer software, but far less efficiently. I could possibly learn make my own shoes, too, but it's a better use of my time to buy them.

Also, as I explained in my previous entry, if federal laws forced Americans to replace illegal immigrants with "legal" domestic labor, certain goods and services would become sufficiently expensive that we wouldn't buy them. So by working for such low wages, illegal immigrants make it possible for middle-class Americans to hire landscapers and fence builders, and enjoy several pounds of strawberries instead of just one. Let's say I can hire a "day laborer" for $5 per hour to mow my lawn or repair a fence. A legal resident might want $20 per hour to do it, and at that price I might just do it myself. But the illegal immigrant makes it possible for me to spend $5 an hour and gain so much more by having free time. Meanwhile, nothing is preventing the legal laborer from seeking a job where he has a comparative advantage -- or is he so uncompetitive that he must use government to force me to pay him what he wants, like with minimum wages?

Briefly, a lot of conservatives like to complain that illegal immigrants don't pay taxes. That is true, but it's offset by the lower prices we pay. That's like complaining about Wal-Mart's everyday low prices because, per item, that means reduced sales tax revenue. Besides, what kind of sadistic person makes taxation an issue, especially a conservative who is supposed to follow the principles of limited government and low taxes? Or is immigrating to the United States like that "Night Court" episode? As a judge, Harry administered the oath of naturalization to a group of people. One was so excited and stuttered, "I'm a, I'm a," to which Harry replied, "Yes! You're a taxpayer."

I will say again that the fundamental issue with illegal immigrants is freedom, but not (at least primarily) about their coming to the United States. Ayn Rand would probably like how I examine it from a very self-centered perspective: I want the freedom to transact peacefully with whomever I choose, whether it's buying from a grocer whose Florida oranges were picked by "undocumented" migrant workers, or hiring a "day laborer" to move furniture. I want the state to stay out of my business when I and the other party are harming no one, instead of forcing me to choose among limited options. In fulfillment of Adam Smith's "invisible hand," I improve others' condition merely by seeking to improve my own, but ultimately it doesn't matter to me whether the person is legal or illegal, of Czech descent or Mexican. My first concern is maximizing my happiness for the least cost to me.

Larry Kudlow really pleased me by emphasizing freedom as the moral facet of the immigration issue. I was glad that a prominent conservative finally criticized the utter stupidity of some people (including members of Congress) who want to criminalize any assistance to illegal immigrants, including churches giving food and shelter. Really, what kind of country are we that, even just for a moment, we consider making it a crime to feed hungry people who came here in search of a better life, in search of freedom? There's a big statue just outside New York City you may have heard about, the one with an inscription about "tired," "poor" and "huddled masses yearning to breathe free." Is that just lip-service, or was there a cut-off date I didn't hear about? Is freedom a scarce commodity that we must hoard it for ourselves?

And one more time, if we're so worried about illegal immigrants costing us billions in government services, let's abolish the welfare state for everybody. Once we do, none of us will have to worry about our tax dollars paying for an illegal immigrant's children, or our neighbor's children either. The only people trying to come to the United States, then, will be those who want to work honestly and not live off others, and criminals. And we can deal with the criminals if we'd stop playing catch-and-release. Let's start meting out appropriately harsh punishments for violent crimes, regardless of who (citizens, legal residents or illegals) committed them.

How's this for perspective: while we're fretting about illegal immigrants costing us billions a year in social services, we're sitting on a ticking timebomb of our own creation that has future underfunded obligations of $70 trillion. Which is the greater threat? If the latter, then why aren't people taking to the streets in mass protests about the need to fix (I prefer "abolish") Social Security and Medicare?



Blogger Charlie said...

Actually, some illegal immigrants are taxpayers. The IRS is bound by law not to share taxpayer information with others (including the INS) and illegal immigrants can get taxpayer IDs and pay their taxes. They may be here illegally, but the government still wants their money.

Wednesday, March 29, 2006 4:30:00 PM  
Blogger gregstephenson said...

illegal aliens almost by definition can not pay taxes. in order to work they use false document under false names and often documents of other people. They also use our public health care system to have babies. Then they lend their babies to legal hispanics who file taxes and get thousands in earned income credit. I suppose that is also a job Americans won't do.

Thursday, March 30, 2006 6:30:00 PM  
Blogger J. Mark English said...

Congrats on the great site. I look forward to stopping by frequently.

Thursday, March 30, 2006 6:47:00 PM  

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