Open Letter on Immigration

[archerships]

Alex Tabarrok of Marginal Revolution writes:

"I have written an open letter on immigration reflecting the consensus opinion of economists on the major issues. In cooperation with the Independent Institute I am looking for as many signatures as possible from economists and other social scientists. Brad DeLong, Greg Mankiw, Vernon Smith, Tyler Cowen and many others from both the left and the right have already signed on.

You can sign by emailing your Name, Title and Organization.

I do hope that bloggers of all political stripes will circulate the letter.

The goal of the letter is not to cover all the issues but rather to say, 'here is the hard-won consensus that economists have come to on these major issues. By all means let us have a debate but let it be an informed debate.'

References and further information can be found here.

Here is the text.

Dear President George W. Bush and All Members of Congress:

People from around the world are drawn to America for its promise of freedom and opportunity. That promise has been fulfilled for the tens of millions of immigrants who came here in the twentieth century.

Throughout our history as an immigrant nation, those who are already here worry about the impact of newcomers. Yet, over time, immigrants have become part of a richer America, richer both economically and culturally. The current debate over immigration is a healthy part of a democratic society, but as economists and other social scientists we are concerned that some of the fundamental economics of immigration are too often obscured by misguided commentary.

Overall, immigration has been a net gain for existing American citizens, though a modest one in proportion to the size of our 13 trillion-dollar economy.

Immigrants do not take American jobs. The American economy can create as many jobs as there are workers willing to work so long as labor markets remain free, flexible and open to all workers on an equal basis.

Immigration in recent decades of low-skilled workers may have lowered the wages of domestic low-skilled workers, but the effect is likely to be small, with estimates of wage reductions for high-school dropouts ranging from eight percent to as little as zero percent.

While a small percentage of native-born Americans may be harmed by immigration, vastly more Americans benefit from the contributions that immigrants make to our economy, including lower consumer prices. As with trade in goods and services, the gains from immigration outweigh the losses. The effect of all immigration on low-skilled workers is very likely positive as many immigrants bring skills, capital and entrepreneurship to the American economy.

Legitimate concerns about the impact of immigration on the poorest Americans should not be addressed by penalizing even poorer immigrants. Instead, we should promote policies, such as improving our education system that enables Americans to be more productive with high-wage skills.

We must not forget that the gains to immigrants from coming to the United States are immense. Immigration is the greatest anti-poverty program ever devised. The American dream is a reality for many immigrants who not only increase their own living standards but who also send billions of dollars of their money back to their families in their home countries—a form of truly effective foreign aid..

America is a generous and open country and these qualities make America a beacon to the world. We should not let exaggerated fears dim that beacon.

Sign here if you are in agreement. Thanks!

Comments

[ernunnos.livejournal.com]

Fails to address the difference between high-skill and low-skill immigrants, or the basic "cost of entry" to a first-world society, and the fact that many immigrants do not contribute enough to meet that, and therefore are a net drag on the economy, and the space they occupy could be better used by a more productive immigrant.

I'm not opposed to immigration. I'm opposed to illegal, low-skill immigration. If low-skill menial labor was the key to wealth, we wouldn't have had to wait 15,000 years to get where we are today.

That has always been in high supply.

[crasch.livejournal.com]

* I'm not a nationalist. Therefore, I question whether the nation-state is the appropriate unit of economic analysis. In my opinion, studies which do not take into account the economic impact of mobilty restrictions on immigrants themselves are invalid.

* I also think that it's relatively easy to count immigrant misdeeds (crime rate, welfare statistics), but hard to count the costs of mobility restrictions (businesses that were not started, marriages that never happened, songs that were never made, inventions that were never created). Therefore, I think that mobility restriction costs are undercounted.

* I don't think monetary costs are the only costs that should be taken into account. Slavery, for example, should've ended, even if it meant economic loss to the white plantation owners.

* I disagree with the notion that laws should be based on the statistical properties of the group to which someone belongs. For example, I don't think that all men should be forced to pay higher taxes, even though men as a group commit crimes at much higher rates than women.

* Most of the costs that mobility restrictionists complain about are imposed via socialist welfare schemes (Medicare/Medicaid, government schools). We should be working to end those welfare schemes, not further decrease the liberty of people in the world.

* Even if I agreed that immigration should be curtailed in principle, I would still oppose it on the grounds that if pursued vigorously enough to stop the flow of immigrants, anti-immigrant measures would result in unacceptable losses to freedom and increases in government power/spending. I see mobility restrictionists calling for a continent-wide wall across our southern border, felony convictions for those who aid illegals (such as churches, non-profits), mandatory national ID (and associated database), RICO charges against those that hire illegals, random illegal sweeps, and internal passports.

[ernunnos.livejournal.com]

I am a nationalist. Nations exist, and some nations offer a demonstrably superior way of life than others. Different political philosophies result in different living conditions, and migration brings with it not only labor, but ideas. Mobility restrictions also allow us to make political distinctions.

Given the dire economic circumstances of countries like Mexico, I will make the not-so-bold claim that the economic value of those political distinctions is far higher than the marginal costs of menial labor.

[deuclion.livejournal.com]

The net gain to the U.S. from immigration is about $7 billion annually.

[ernunnos.livejournal.com]

Source please? If that's true it's a factoid I'll use. $7 billion is peanuts. The President's new chopper is $6 billion. Throw in a few unaccounted for costs, and you've got that. And if that is the true benefit, I'll trade $7 billion of a multi-trillion dollar economy for preservation of culture and a stable population. It amounts to a tax of a fraction of 1%.

[deuclion.livejournal.com]

It's from a study by George Borjas of Harvard.

[ernunnos.livejournal.com]

Oh c'mon, don't be coy. Give me a link, or at least the title of the paper. Googling his name the first link is one that says that immigrants actually cost the average worker 4% of their wages (http://www.cis.org/articles/2004/back504.html). And those without a high school diploma over 7%.

[dogofjustice.livejournal.com]

Back when wars were won primarily by outnumbering the enemy, your metric might have made sense. But nowadays, individual standard of living is a much more logical metric.

I'm pretty sure illegal immigration from Mexico has a negative per capita effect, while legal immigration has tended to have positive effects.

[deuclion.livejournal.com]

We don't know what skill set the future will need. But, we do know that all immigrant workers regardless of skill bring in new ideas and help entrepreneurs.

[ernunnos.livejournal.com]

No they don't. Consider the degenerate case of an immigrant with no skill who spends his days robbing cars. Obviously it's not fair to judge all immigrants by that individual, but he exists and exists by the thousands as the prisons of Arizona and California prove. Which is plenty to disprove your broad generalization.

[deuclion.livejournal.com]

Every person has a skill. Even the know how of stealing cars is a skill that can be utilized by businesses. But the point is the more people you have the easier and cheaper it becomes to start and run businesses.

Even if you're right with your broad generalization that thousands of illegal immigrants from Mexico come to this country for the sole reason of doing nothing but robbing cars, there are millions of people who cross the border legally and illegally every year. One-thousand car robbers out of millions of people isn't that damning a statistic.

[ernunnos.livejournal.com]

Every person has a skill.

Even if you count car thieving as a skill, it's not a worthwhile one until it's turned to other purposes, and that takes will. Not everyone has that will. A certain percentage of the population (any population) are sociopaths and 'thrill seekers' who have no desire to perform useful work, regardless of their skills. It is worthwhile for us to weed those people out before they get a chance to actually put their 'skills' to use hurting others.

One-thousand car robbers out of millions of people isn't that damning a statistic.

Ah, but all it takes is one to make the lives of thousands of others miserable. It's easier to destroy than to build, so one destructive individual can easily wipe out the hard gains of many good people. Therefore, even though they are a small minority, it makes sense to examine the flow of individuals who wish to enter the country and figure out which are which.

That requires a controlled border, and a deliberative immigration process. Which is all I'm asking for.

[dogofjustice.livejournal.com]

I am also in disagreement with this. Assimilation is essential, and modern policies are not effective at promoting it. I understand that current research indicates Mexican immigrants are tracking with Italian immigrants of a century ago; that is reason for optimism. But early 20th century assimilation was helped along by the immigration cutoff of 1924. If we don't do something similar in the future, we cannot expect the correlation to continue.

Also, revealed preference (Mexico is extremely intolerant of illegal immigration from Central America) very, very strongly suggests at least the Mexican government actually believes that increasing immigration from Mexico into the US is not a win-win, but instead benefits Mexico at the expense of the US. We should at least make sure we understand why they think they're pulling a fast one on us, and be certain that they did their math wrong, before doing what they want us to do.

Finally, it is worth noting that the #2 and #3 economies in the world, Japan and China, continue to have immigration policies focused only on high-skill immigrants, and they have overtaken many other countries with more liberal immigration policies along the way. Immigration is clearly better than the complete absence of it -- but is promoting low-skill immigration really the best play, given that we're currently such a desirable destination that we pretty much have our pick of immigrants?