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Immigration and Inequality

18 Jun 2007 10:44 am

Last week, Matt explained why liberals who worry about inequality don't worry about reducing illegal immigration:

What most liberals think is that we should resist efforts to frame the economic problems of working class Americans as solely a matter of zero-sum competition with Mexican peasants, as opposed to something that could be more productively dealt with through measures that might compromise the interests of the global elite.

Of course, one might argue that reducing illegal immigration is something that would “compromise the interests of the global elite” – which is one reason (among many others, some of them quite high-minded) why so many members of that elite are on the “left” on immigration. A slightly better way of putting what Matt is driving at, I think, is this: Large-scale immigration from Mexico to the United States is a form of de facto humanitarianism, and since Americans are generally leery of humanitarian spending (primarily because we overestimate the size of our existing foreign aid budget), liberal humanitarians have a vested interest in preserving the existing immigration system. It’s a rare issue where business interests line up on the side of raising the living standards of Third World peasants, and why mess with a good thing? Better, as Matt suggests, to go after the global elite in other arenas – like tax policy, say – where the business class’s preferred policies don’t have humanitarian externalities.

To which one might respond that there’s something slightly perverse about pursuing humanitarian ends through policies that lower the incomes of your poorest citizens and raise the incomes of your richest citizens. If I proposed a new AIDS-in-Africa initiative and advocated funding it through a regressive tax that included a tax credit for families making over $75,000, I doubt that many liberals would line up behind the proposal.

I would add that I’m by no means opposed to other measures that “compromise the interests of the global elite” to help out the American poor and working class. But the measures I would support – which range from wage subsidies to scrapping the payroll tax and replacing it with a VAT that hits the rich hardest – tend to involve using the government as a middleman, raising wages by redistributing income. I’m increasingly persuaded that this may be a necessary evil, but it’s far from ideal, and where when there’s an opportunity to raise wages without bringing the tax code into it, I think we should take it - particularly when it involves what's supposed to be a pretty basic function of government.

Comments (27)

Ross: "there’s something slightly perverse about pursuing humanitarian ends through policies that lower the incomes of your poorest citizens and raise the incomes of your richest citizens."

Well, no, not really, if it's based on the fact that the poorest here are much better off than those entering the country. That view is not necessarily implausible or "perverse."

Utilitarianism often veers into perversity, but it might not in this case.

The AIDS funding comparison makes no sense. The issue in immigration is movement of people. (I came up with that insight myself; please cite to me if you borrow it). There are, therefore, tradeoffs in immigration policy that do not exist in foreign aid, and many other policy areas.

It all boils down to an empirical question. I haven't got the data, myself, and I have no idea who to trust on it.

Well, no, not really, if it's based on the fact that the poorest here are much better off than those entering the country. That view is not necessarily implausible or "perverse."

exactly. from a landsburgian perspective it is a win-win. if the american working class are driven toward gov. subsistence that is still a mighty high life compared to third world populations. (e.g., see their obesity). so the equation:

(greatly increased utility for immigrants - marginally decreased utility for native bottom 25%ers) is a no brain

assuming that

a) you don't privilege native populations before non-native ones

b) that all individuals care about is absolute utility as opposed to their position on the distribution

b) is critical. i think there's a lot of literature in behavioral economics which suggests that people would rather be big fishes in small ponds than small fishes in big ponds. the first generation of immigrants might feel uplifited, but their offspring sure as hell aren't going to be wanting to do shit jobs, they're americans. and the newly gov. dependent class native working class feels even more marginalized than they already did despite their global scale affluence.

I’m increasingly persuaded that this may be a necessary evil, but it’s far from ideal, and where when there’s an opportunity to raise wages without bringing the tax code into it, I think we should take it - particularly when it involves what's supposed to be a pretty basic function of government.

Hmmm. I tend to part with my liberal friends on immigration if indeed the reason they don't oppose it is that they want to improve the lives of people who live in poor countries. I mean, I, too want to help my fellow human beings. But I just don't think the modest immigration inflows this country can handle can tackle even the tip of the iceberg of world poverty.

I favor immigration (even the variety that comes in illegally if no legal means is provided) solely because I think it's in the country's best interest*. If we were able to magically stop all illegal immigration tomorrow morning, just how many workers would get a wage boost? Two percent? Five percent? I seriously doubt very many would benefit. And just how large would these raises be? Three percent? Six Percent? Eight percent? A principal reason I don't buy Ross's logic about the harm caused by illegal immigration is my strong suspicion that any benefits flowing to poorer workers would be so minuscule, they would almost certainly not justify the very high price of achieving (via an "enforcement-only" approach as opposed to a "legalization" approach) this "pretty basic function of government." http://www.economist.com/finance/displaystory.cfm?story_id=9256643

*I won't rehash all the economic arguments in favor of generous immigration. But I would like to point out that one of the oft-overlooked advantages to attracting immigrants is in the area of geopolitical influence. Long story short, the US population -- even when immigration is thrown into the mix -- is growing much more slowly than fifty or sixty years ago - to say nothing of the nineteenth century. I just don't think we therefore need to ratchet down even further our already slackening population growth -- and that's exactly what would happen if we were to miraculously stop the flow of people sneaking into the country (although for security reasons, of course, I'd much prefer that such people come in pre-screened, through an official, legal immigration program). Russia and Western Europe aren't exactly the poster children for maintaining power and influence in a dangerous world.

But I would like to point out that one of the oft-overlooked advantages to attracting immigrants is in the area of geopolitical influence.

the jewish, cuban and armenian immigrants streams are one way that geopolitical calculus comes into play: immigrant groups have their own biases about what "side" amerika should take.

immigrant groups have their own biases about what "side" amerika should take.

Well, once it turned out the British Empire wasn't all powerful, the indigenous Anglo Protestants turned out to have some preferences too.

Well, once it turned out the British Empire wasn't all powerful, the indigenous Anglo Protestants turned out to have some preferences too.

sure, all groups have some preferences, more or less. the issue is going to be juggling conflicting preferences. muslims don't equal jews in numbers let alone influence in the USofA, but it seems likely that over the next generation the pro-israel vector will have to contend with a counter-posing one from the muslim quarter. as long as the evangelicals remain pro-israel AIPAC is probably safe though.

p.s. the irish americans were from what i recall notoriously disinclined to intervene in the 'great war' against the germans on behalf of the united kingdom.

It is important to apply common sense in addressing this issue. It is a question of security for the people of the U.S. and fairness, arguably a tenet of the American people. Rather than regurgitate what I have already written, I encourage readers to read my blog. See the link, please!

Last week, Matt explained why liberals who worry about inequality don't worry about reducing illegal immigration:

Neither Matt nor Jonah's reader were talking about illegal immigration.

It is important to apply common sense in addressing this issue.

I disagree.

Why Mexico?

According to the CIA World Factbook, 5,043,000,000 people live in countries with lower average per capita incomes than Mexico (purchasing power parity-adjusted).

So, if the interests of blue collar Americans are to be sacrificed for global humanitarianism, why Mexicans and not Bangladeshis and Ethiopians?

Last week, Matt explained why liberals who worry about inequality don't worry about reducing illegal immigration

The reason is that most modern liberals aren't actually interested in inequality per se: they're interested in using inequality as an emotional appeal towards furthering their goal of greater statism. (In all the romanticization of communism, how frequently have you hear liberals decry the disparity in wealth and power between the communist leaders and the average citizen? It's always the greedy capitalists who are the target, even if they created their wealth themselves, because they aren't under the control of the government.) Ted Kennedy isn't interested in having millions of illiterate people come here from the third world because he wants to make their lives better: he wants them to come here because they'll be more dependent on government handouts and will vote Democratic, entrenching the Democratic party in control of government.

Jasper,

I favor immigration (even the variety that comes in illegally if no legal means is provided) solely because I think it's in the country's best interest*.

So you think it is in our country's best interests to have our laws openly flouted?

(although for security reasons, of course, I'd much prefer that such people come in pre-screened, through an official, legal immigration program)

Screening people takes time and resources, which means that it places a limit on the number of people that can be efficiently admitted into the country. Which directly contradicts your previous statement that you think it is OK for people to ignore immigration laws (based on what criterion? that they can find a job that pays more than they make in their home country? like Sailer says, that's a heck of a lot of people).

The economic arguments in favor of the type of immigration we are seeing right now are specious. Bringing in millions of poor, uneducated people into the most advanced economy on the planet is going to have a significant positive impact? How does that work, exactly? The point is not that immigration hasn't been beneficial to our country - it's what types of immigration have been helpful, and will be helpful in the future? Having bright, motivated people come here because they want to succeed on their own and become Americans is a good thing for the country. Having poorly educated people who aren't very motivated to become educated and have no interest in becoming American citizens is not a good thing for the country.

Jasper,

It's not so clear that population and power are as closely coupled as you seem to keep. Bangladesh boasts over 150m citizens whereas the population its former colonial master, the UK, is only 55m or thereabouts. And yet, Dhaka has nowhere near the power and influence that London possesses. It's hard to imagine a US with 150m not still being a superpower.

In any case, whether it's a worthwhile trade for the common citizen to accept overpopulation and its associated social problems so that his country's elites can through their weight around on the global stage is something of an open question.

"It's not so clear that population and power are as closely coupled as you seem to think."

Mike S:

So you think it is in our country's best interests to have our laws openly flouted?

As opposed to what? Keeping the law from being "flouted" at any cost? Sure. It's similar to drugs. Obviously the fact that, say, 20 million Americans smoke cannabis regularly undermines respect for the law. I'd like to see the law reformed. But in the absence of such reform, I'd much prefer the law against cannabis be "flouted" than see our country bear the catastrophic costs of enforcing it rigorously. In my judgment a modest amount of illegal immigration is a net benefit to America. So sure, given the catastrophic costs we'd have to pay to effect, say, a 90% decrease in illegal immigration, I'll take "flouting" any day (though my first choice, of course, is a program of legal immigration that undermines the economic incentives to immigrate illegally).

Screening people takes time and resources, which means that it places a limit on the number of people that can be efficiently admitted into the country.

Who's arguing otherwise? I like limits.

Which directly contradicts your previous statement that you think it is OK for people to ignore immigration laws...

I made no such statement. You really ought to read other people's comments with at least a modicum of care.

The economic arguments in favor of the type of immigration we are seeing right now are specious.

Says you, but not most economists.

Bringing in millions of poor, uneducated people into the most advanced economy on the planet is going to have a significant positive impact?

The fact that ours is the world's most advanced economy argues in favor of our ability to absorb millions of poor people. Indeed we've been doing so for forty years, and if anything have widened our lead over much of the world. When you add American managerial talent and capital to Third World workers, they're no longer Third World workers.

Having bright, motivated people come here because they want to succeed on their own and become Americans is a good thing for the country.

Agreed.

Having poorly educated people who aren't very motivated to become educated and have no interest in becoming American citizens is not a good thing for the country.

Here the picture is more mixed. So-called "poorly educated" people perform work that is valued by many Americans -- hence the billions of dollars spent by those Americans on the services of these immigrants. I agree assimilation is a laudable goal, and support a robustly, explicitly assimilationist immigration policy.

It's not so clear that population and power are as closely coupled as you seem to keep.

I didn't say they're "closely coupled" but it's obvious that they're related. The simplest formula is he who has the biggest GDP rules. Obviously one part of that formula is per capita GDP. And obviously the other part is the number of "capitas". Norway and Luxembourg each are richer than America. It's pretty obvious why neither is as powerful as the US, just as it's pretty obvious why Bangladesh is far less than "half" as powerful as the US, despite having about half America's population. Maybe I'm crazy, but I'm not tickled pink that China will likely have a larger GDP than the United States (in purchasing power parity terms) some time in the next decade.

In any case, whether it's a worthwhile trade for the common citizen to accept overpopulation and its associated social problems so that his country's elites can through their weight around on the global stage is something of an open question.

In any case, whether the United States is on a path to anything resembling "overpopulation" isn't an open question. We're not. And I'm not the least bit interested in allowing "elites" to "throw their weight around." What I am interested in is the continued, robust sovereignty of the United States of America. Geopolitical power -- which largely means being rich and having a large, vigorous economy -- is what underpins that sovereignty. Smaller nations can, to some extent, rely on greater powers (namely America) to guard their independence. We can't. America loses her pole position at her peril. A growing population helps us hold onto that pole position.

The country, socially and culturally, is in need of a pause from immigration.

This article is one illustration why that is.

Hmmm. Link didn't take. Try Googling "Let the Segregation Commence" instead.

As a possible counterpoint to the "illegal immigration is good for us" arguments, here are some stats, comparing Japan, Iceland and Switzerland (which have historically had, I believe, the most strict immigration policies among the OECD countries), to the U.S. (which has had the most liberal immigration policies). All data is from nationmaster.com, except for the "quality of life" stats, which are from the Economist (http://www.economist.com/media/pdf/quality_of_life.pdf) and the UN (http://hdr.undp.org/hdr2006/statistics).

You'll notice that the U.S. usually ranks worst among the four countries, and if not that, then second worst, by each measure, except for per-capita GDP.

Per capita GDP (PPP normalized)
SW - $33,062
JP - $29,620
IC - $32,338
US - $39,319

Overall quality of life (Economist)
SW - 8.068
JP - 7.392
IC - 7.911
US - 7.615

Overall quality of life (UN; world ranking)
SW - #9
JP - #7
IC - #2
US - #8

Life expectancy
SW - 80.6
JP - 82.0
IC - 80.4
US - 78.0

Infant mortality (per thousand)
SW - 4.28
JP - 2.80
IC - 3.27
US - 6.37

Teen pregnancy (per million)
SW - 146
JP - 137
IC - 890
US - 1672

Per capita murder rate (per thousand)
SW - 0.0092
JP - 0.0050
IC - 0.0168
US - 0.0428

Per capita assault rate (per thousand)
SW - NA
JP - 0.34
IC - 4.66
US - 7.57

Per capita robbery rate (per thousand)
SW - 0.2908
JP - 0.0406
IC - 0.1146
US - 1.3853

And as for the "we're also helping the illegals" argument, is it really clear that, in the case of Mexico and some Central American countries (who send very significant fractions of their populations to the U.S. illegally) allowing mass immigration from those countries in fact does those countries' people good? Maybe we're retarding reform and making improvement in the countries themselves less likely?

here are some stats, comparing Japan, Iceland and Switzerland (which have historically had, I believe, the most strict immigration policies among the OECD countries), to the U.S. (which has had the most liberal immigration policies).

Those countries stand in contrast to the US in other salient ways. But I'll trade you Switzerland's immigration policy for its foreign policy, and for 300 million SIG 550s.

jenny

Jasper,

So I'm supposed to think that "I'll take flouting any day" does not mean that you think flouting immigration law is OK?

The fact that ours is the world's most advanced economy argues in favor of our ability to absorb millions of poor people. Indeed we've been doing so for forty years, and if anything have widened our lead over much of the world. When you add American managerial talent and capital to Third World workers, they're no longer Third World workers.

The question is not whether we can absorb them, but whether they contribute anything significant economically.

Here the picture is more mixed. So-called "poorly educated" people perform work that is valued by many Americans -- hence the billions of dollars spent by those Americans on the services of these immigrants. I agree assimilation is a laudable goal, and support a robustly, explicitly assimilationist immigration policy.

By definition, the work they perform is "valued" the least by the market. For example, in agriculture switching from illegal immigrant labor to legal labor would raise the price of a head of lettuce a few cents.

Assimilation is made much more difficult by larger numbers, by a high concentration of immigrants coming from one country or one area, and by high rates of illegal immigration. It is also made more difficult by granting of social welfare programs to immigrants as soon as they get here (which was not a feature of earlier immigration waves), and by the multiculturalist ethos. Given all these facts, if you truly favor assimilationist policies you ought to favor enforcing the law and reducing immigration levels until we get control of our immigration system. Because if things continue the way they are, assimilation is not going to happen.

Terry, You're confused. While Japan has a dismal level of immigration, Switzerland leads OECD countries of immigrant inflows as a % of population.

Look at this chart from the OECD countries:

http://caliban.sourceoecd.org/vl=1119839/cl=40/nw=1/rpsv/factbook/12-01-01-g01.htm

Then go back and look at quality of life for all those countries that have more the twice the inflows of foreign nationals as the U.S. You'll see that you've just argued the opposite of what you intended.

Will, I should clarify what I meant by "most strict" immigration policies. I wasn't referring to actual inflows, since that's a function of the pressure *for* immigration versus the pressure *against* it. Voltage versus resistance. If a country is more attractive to potential immigrants, then there will be more people who are able to get through whatever regulations/restrictions are in place.

Some points about Switzerland in particular:

1. That graph you linked to includes guest workers (and possibly border commuters) of which there are a large number in the country.
2. I also had in mind their naturalization procedures, which are the most strict, complicated and expensive on the continent. You basically have to *show* to your canton and commune that you have become integrated into Swiss society after living in the country legally at least 12 years, all the while paying taxes and being completely free of criminal activity. Some cantons even require public votes on whether to grant or deny an applicant citizenship.
3. Immigration to Switzerland is overwhelmingly labor needs-based.
4. It’s very, very difficult for a non-European to obtain permanent residence in Switzerland.
5. They’ve never done an amnesty.
6. Switzerland actually enforces their immigration law.

Yes, Japan has "dismal" immigration levels. Just the way they like it. Have you been there? Beautiful country, good people.

Re the economic benefits from immigration, see George Borjas's blog.

The gains consist largely of transferring money from current workers (by lowering their wages) to businesses.

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