The Gang of Eight’s immigration bill is nothing less than a frontal assault on America’s already-struggling blue collar population. Forget border security–the bill would be an abomination even if it could magically guarantee that upon passage, not a single person would ever again cross the border illegally. The bill is a disaster because of the legal immigration it will authorize, estimated at somewhere between 30 million and 57 million above current levels over the next ten years. And these new legal immigrants will be overwhelmingly–like, 90%–low-skilled and low-wage. What will that do to the employment prospects and wages–if they’re lucky enough to be employed–of America’s already largely underemployed working class? Unless the Gang of Eight can repeal the law of supply and demand, it will unemploy millions of them and drive down the wages of the rest. Which, of course, is why some business interests are so enthusiastic about the bill.
It sometimes seems that Jeff Sessions is the only voice of sanity in Washington on this issue. Today he said:
Everyone understands that a large increase in the number of immigrants increases the GDP: more people means more overall consumption. But the question is: who benefits from such a large surge in the available supply of labor into a country? If you suddenly provide legal status to 30 million immigrants, most of whom will be lower skilled, it will simultaneously increase the GDP while reducing per-capita GDP—and reducing the wages of the current workforce. It will hit the lower-income worker particularly hard.
Fortune 500 companies will always enhance profit margins from the availability of an increasing supply of lower-skill, lower-wage labor. Any discussion of increased GDP from more foreign workers, therefore, must also look at whose wages are being reduced and whose jobs are being lost.
As Dr. Borjas, the nation’s leading expert on this issue, reported in 2012, recent immigration has reduced the wages of native workers by 5.3 percent, and reduces the incomes of native workers by $402 billion per year. At the same time, the incomes of businesses would go up by $437 billion per year. A report from Northeastern University’s Center for Labor Market Studies found that unskilled immigrants were taking jobs in the construction sector, a sector many young Americans seek to enter.
Right now, nearly 1 in 2 African-American teenagers looking for work cannot find a job. In Washington, D.C., 1 in 3 youths are living in poverty. In Detroit, 1 in 3 households are on food stamps. Is our top economic priority really to provide immediate work permits to 4 million people who overstayed their visas, as this bill does? In addition to the amnesty, the Senate bill proposes, over the next decade, to at least double the annual flow of guest workers while tripling the number of mostly lower-skill permanent legal immigrants. These staggering increases come at a time when 21 million Americans are struggling to find full-time employment. This is not only an abstract economic issue but one of great human importance.
Will this bill make is easier, or harder, for out struggling residents to find a job? Will this make it easier, or harder, for those living in poverty to get a raise and work their way into the middle class?
So while the authors of this bill will inevitably tout the fact that adding 30 million immigrants to the nation will increase the GDP, they won’t say it will be at the expense of struggling U.S. workers—immigrant and native born—who are trying to support their families and climb into the middle class. This is what Dr. Borjas has found. The Senate immigration bill would be the biggest setback for poor and middle-class Americans of any legislation Congress has considered in decades.
We all believe in immigration and will continue to be the most generous nation in the world when it comes to welcoming new people into our country. But a reasonable level of immigration that promotes assimilation, upward mobility, self-sufficiency, and rising wages is in the best interests of both U.S. workers and future immigrants themselves. Polls show the American people overwhelmingly reject a dramatic surge in immigration and, as usual, their common sense is right. The grand plans of business interests for a large increase in immigration may indeed increase the businesses’ income, but it will further expand the wealth gap as incomes for struggling workers will decline.
There are a lot of bad economic arguments being made by supporters of the Gang’s proposal. Their most common theme is that adding 30 million to 50 million new immigrants will increase the country’s GDP. Good Lord, I should hope so! That would be the case, unless every single one of them was unemployed. But that isn’t the standard. If millions of new immigrants do nothing but sell each other tacos and clean each others’ houses, GDP will rise. The question is, will per capita income rise for those who are already here, before the massive influx of tens of millions of new (or newly legal) immigrants?
A friend who is an expert in the field and follows the immigration debate closely comments on the economic fallacies employed by the bill’s proponents:
Total output is a completely false measure of prosperity…only output per capita matters, with output relatively broadly distributed based on marginal contribution to output. On the total output measure China is about to surpass the U.S…but with over 4 times the population, and with their economic growth achieved at the cost of massive over-crowding, environmental destruction and pollution it is absurd to think China is more prosperous than the U.S.
It’s all of a piece–extensive growth and aggregate GDP, rather than intensive growth–GDP per capita. And at any price, including huge unprecedented population increases. Unstated, but in the background, is the notion that since we “need” greater population, and greater population growth, for prosperity, defined as aggregate GDP growth, and if we can’t have higher native fertility rates, then let’s have unlimited immigration of highly fertile 3rd world immigrants! It will really crank up the GDP growth engine! Think of all the taco stands andnail salons!
But the real not-so-hidden agenda is the entitlements regime–unfunded, un-means tested, and unsustainable, all exacerbated by a population shift to relatively more elderly but NOT by itself from change in total population. They would rather reinforce the entitlements regime with huge demographic change, actually grossly swindling the New Brown Americans as they take their places as the newcomer Ponzi suckers, than reform the system permanently. If they did reform the system, the entire political structure of the New Class would be seriously damaged. They would rather sell their birthright than suffer a loss of political power.
That pretty much sums up the Democratic Party, but why on Earth are any Republicans on board with their program?