Tag: skilled labor

Should the U.S. Restrict Immigration?

Recent debates about Arizona’s new immigration law have taken as self-evident that immigration restrictions are good policy, with the only question being which level of government should enforce the law, and how. Yet the case for immigration restrictions is far from convincing.

Advocates of these restrictions rely on four possible arguments. First, that immigration dilutes existing languages, religions, family values, cultural norms, and so on. Second, that immigrants flock to countries with generous social welfare programs, leading to urban slums and inundated social networks. Third, that immigration can harm the sending country if the departing immigrants are high-skilled labor. Fourth, that immigration lowers the income of native, low-skill workers.

All of these arguments are wrong, overstated, or misguided. Immigration may change cultural values or norms, but nothing suggests this is a negative. Many societies flourish because they have incorporated new businesses, cultures, foods, and so on. More important, immigrants normally assimilate to the pre-existing culture provided government policy does not segregate them from the rest of society. In the past rich countries have incorporated large immigration flows with modest adjustment costs. Many of these immigrants lived in difficult conditions at first, but within a generation they achieved middle class status or better.

The possibility that immigration puts pressure on the welfare state is a reasonable concern, although existing evidence does not suggest this is a major problem. In any case, the possibility that a generous social safety net might encourage immigration is a reason to moderate this safety net, rather than a reason to restrict immigration. Indeed, expanded immigration might create pressure to keep the welfare state modest.

The risk that immigration drains high-skilled labor from poor countries is real, but this kind of immigration has positive impacts on the sending country that mitigate against any negatives. The possibility of migration to a high-wage country generates an incentive to acquire education, and only some of those educated actually leave. The threat of a brain drain nudges poor countries away from bad policies-such as excessive tax rates-that generate the brain drain in the first place. Many immigrants send remittances to friends or relatives in their country of origin. Plus, if borders were really open, many immigrants would seek education abroad but return to their home country, knowing they could leave if economic factors so dictated. Similarly, with open borders many immigrants would pursue temporary stays in higher wage countries. Temporary migration is common in many countries now, and was common in the U.S. before the tightening of immigration rules in the 1910s and 1920s. Temporary migration raises fewer of the standard concerns than permanent migration, while still helping many people in low-wage countries.

Concern for the poor, assuming this includes the poor in other countries, argues for vastly expanded immigration since many potential immigrants are much poorer than the natives whose wages they might depress. Only a bizarre view of equity favors people earning the minimum wage in rich countries over people near starvation in developing countries.

The conclusion that open borders is the best immigration policy is all the stronger because attempts to restrict immigration have their own negatives. These include the direct costs of border controls, the creation of a violent black market for immigration, and incentives for corruption. Further, immigration may have beneficial effects on productivity by fostering competition and introducing new ideas, approaches, business models, products, and so on. At the same time, many people in receiving countries enjoy the influence of new cultures. Immigrants also work at jobs for which the native supply is small.

Reasonable people can argue that immigration should increase gradually to moderate the transition costs. But any reasonable balancing implies vastly expanded immigration relative to current levels. This would improve the welfare of poor people in other countries far more than foreign aid.

C/P at psychologytoday.com

Ending the Black Market in Low-skilled Labor

Alex Nowrasteh and Ryan Young of the Competitive Enterprise Institute make the case for immigration reform in an especially appealing way in a fresh op-ed this week in the Detroit News.

In a commentary article titled, “Fix immigration rules to crush black market,” they dissect a well-meaning but flawed Obama administration effort to fix the dysfunctional H-2A visa program for temporary farm workers. Instead of fine tuning an unworkable law, Nowrasteh and Young advocate liberalization:

That means making H-2A visas inexpensive, easy to obtain, and keeping the related paperwork and regulations to a minimum. That means no minimum wage hike. No costly background check requirements. People rarely break laws that are reasonable and easy to obey.

When legal channels cost too much in time and money, people will turn to illegal channels every time. That’s how the world works. Getting rid of immigration’s black market begins with admitting that fact.

Hear, hear.