Saturday, August 13, 2016

Anti-Immigration Myths Debunked

It is not often that the blog re-publishes an item from a conservative think-tank such as the CATO Institute but on the subject of immigration it exposes the errors and false claims of the right-wing nativists/nationalists.

1.  “Immigrants will take our jobs and lower our wages, especially hurting the poor.”

This is the most common argument and also the one with the greatest amount of evidence rebutting it.  First, the displacement effect is small if it even affects natives at all.  Immigrants are typically attracted to growing regions and they increase the supply and demand sides of the economy once they are there, expanding employment opportunities.  Second, the debate over immigrant impacts on American wages is confined to the lower single digits – immigrants may increase the relative wages for some Americans by a tiny amount and decrease them by a larger amount for the few Americans who directly compete against them.  Immigrants likely compete most directly against other immigrants so the effects on less-skilled native-born Americans might be very small or even positive.

New research by Harvard professor George Borjas on the effect of the Mariel Boatlift – a giant shock to Miami’s labor market that increased the size of its population by 7 percent in 42 days – finds large negative wage effects concentrated on Americans with less than a high school degree.  To put the scale of that shock to Miami in context, it would be as if 22.4 million immigrants moved to America in a six-week period – which will not happen.  Some doubt Borjas’ finding (here is Borjas’ response to the critics and here is a summary of the debate) but what is not in doubt is that immigration has increased the wages and income of Americans on net.  The smallest estimates immigration surplus, as it is called, is equal to about 0.24 percent of GDP – which excludes the gains to immigrants and just focuses on those of native-born Americans.

2. “Immigrants abuse the welfare state.”

Most legal immigrants do not have access to means-tested welfare for their first five years here with few exceptions and unauthorized immigrants don’t have access at all – except for emergency Medicaid.

Immigrants are less likely to use means-tested welfare benefits that similar native-born Americans.  When they do use welfare, the dollar value of benefits consumed is smaller.  If poor native-born Americans used Medicaid at the same rate and consumed the same value of benefits as poor immigrants, the program would be 42 percent smaller.

Immigrants also make large net contributions to Medicare and Social Security, the largest portions of the welfare state, because of their ages, ineligibility, and their greater likelihood of retiring in other countries.  Far from draining the welfare state, immigrants have given the entitlement portions a few more years of operation before bankruptcy.  If you’re still worried about immigrant use of the welfare state, as I am, then it is far easier and cheaper to build a higher wall around the welfare state, instead of around the country.

3. “Immigrants are a net fiscal cost.”

Related to the welfare argument is that immigrants consume more in government benefits than they generate in tax revenue.  The empirics on this are fairly consistent – immigrants in the United States have a net-zero impact on government budgets (the published version of that working paper is published here).

It seems odd that poor immigrants don’t create a larger deficit but there are many factors pushing explaining that.  The first is that higher immigrant fertility and the long run productivity of those people born in the United States generates a lot of tax revenue.  The second is that immigrants grow the economy considerably (this is different from the immigration surplus discussed above) and increase tax revenue.  The third is that many immigrants come when they are young but not young enough to consume public schools, thus they work and pay taxes before consuming hundreds of thousands of dollars in public schools costs and welfare benefits – meaning they give an immediate fiscal boost.  There are many other reasons as well.

Although the tax incidence from immigrants is what matters for the fiscal consequences, between 50 percent and 75 percent of illegal immigrants comply with federal tax law.  States that rely on consumption or property taxes tend to garner a surplus from taxes paid by unlawful immigrants while those that rely on income taxes do not.             

4.  “Immigrants increase economic inequality.”

In a post-Piketty world, the argument that immigration is increasing economic inequality within nations is getting some attention.  While most forms of economic inequality are increasing among people within nations, global inequality is likely falling due and at a historic low point due to rapid economic growth in much of the world over the last generation.

The evidence on how immigration affects economic inequality in the United States is mixed – some research finds relatively small effects and others find substantial ones.  The variance in findings can be explained by research methods – there is a big difference in outcomes between a study that measures how immigration affects economic inequality only among natives and another study that includes immigrants and their earnings.  Both methods seem reasonable but the effects on inequality are small compared to other factors.

Frankly, I don’t see the problem if an immigrant quadruples his income by coming to the United States, barely affects the wages of native-born Americans here, and increases economic inequality as a result.  The standard of living is much more important than the earnings distribution and everybody in this situation either wins or is unaffected.

5.  “Today’s immigrants don’t assimilate like previous immigrant groups did.”

There is a large amount of research that indicates immigrants are assimilating as well as or better than previous immigrant groups – even Mexicans.  The first piece of research is the National Academy of Science’s (NAS) September 2015 book titled The Integration of Immigrants into American Society.  It’s a thorough and brilliant summation of the relevant academic literature on immigrant assimilation.  Bottom line:  Assimilation is never perfect and always takes time, but it’s going very well.

The second book is a July 2015 book entitled Indicators of Immigrant Integration 2015 that analyses immigrant and second generation integration on 27 measurable indicators across the OECD and EU countries.  This report finds more problems with immigrant assimilation in Europe, especially for those from outside of the European Union, but the findings for the United States are quite positive.

The third work by University of Washington economist Jacob Vigdor compares modern immigrant civic and cultural assimilation to that of immigrants from the early 20th century (an earlier draft of his book chapter is here, the published version is available in this collection).  If you think early 20th century immigrants and their descendants eventually assimilated successfully, Vigdor’s conclusion is reassuring:

“While there are reasons to think of contemporary migration from Spanish-speaking nations as distinct from earlier waves of immigration, evidence does not support the notion that this wave of migration poses a true threat to the institutions that withstood those earlier waves.  Basic indicators of assimilation, from naturalization to English ability, are if anything stronger now than they were a century ago.”

For the nostalgic among us who believe that immigrants assimilated so much more smoothly in the past, the plethora of ethnic and anti-Catholic riots, the nativist Know-Nothing movement, and immigrant groups that refused to assimilate are a useful tonic.  Immigrant assimilation is always messy and it looks bad from the middle of that process where we are right now, but the trends are positive and pointing in the right direction.

6.  “Immigrants are especially crime prone.”

This myth has been around for over a century.  It wasn’t true in 1896, 1909, 1931, 1994, and more recently.  Immigrants are less likely to be incarcerated for violent and property crimes and cities with more immigrants and their descendants are more peaceful.  Some immigrants do commit violent and property crimes but, on the whole, they are less likely to do so.

7.  “Immigrants pose a unique risk today because of terrorism.”

Terrorism is not a modern strategy.  There were a large number of bombings and terrorist attacks in the early 20th century, most of them committed by immigrants, socialists, and their fellow travelers.

Today, the deaths from terrorism committed by immigrants are greater than they were a century ago but the risk is still low compared to the benefits of immigration.  For instance, the chance of an American being killed in a terrorist attack committed on U.S. soil by a refugee was one in 3.6 billion from 1975 to 2015.  For all foreign-born terrorists on U.S. soil, the chance of being murdered in a terrorist attack is one in 3.6 million during the same period of time.  Almost 99 percent of those murders occurred on 9/11 and were committed by foreigners on tourist visas and one student visa, not immigrants.  Cato has a paper coming out in September that explores this in greater detail.  Every death from terrorism is a tragedy but immigrants pose a relatively small threat relative to the big benefits of them being here (remember the immigration surplus above).

8.  “It’s easy to immigrate to America and we’re the most open country in the world.”

It is very difficult to immigrate to the United States.  Ellis Island closed down a long time ago.  In most cases, there isn’t a line and when there is, it can take decades or centuries.  This chart shows the confusing and difficult path to a green card.  Does that look easy to you?

America allows greater numbers of immigrants than any other country.  However, the annual flow of immigrants as a percent of our population is below most other OECD countries because the United States is so large.  The percentage of our population that is foreign-born is about 13 percent – below historical highs in the United States and less than half of what it is in modern New Zealand and Australia.  America is great at assimilating immigrants but other countries are much more open.  

9.  “Amnesty or failure to enforce our immigration laws will destroy the Rule of Law in the United States.”

For a law to be consistent with Rule of Law principle, it must be applied equally, have roughly ex ante predictable outcomes based on the circumstances, and be consistent with our Anglo-Saxon traditions of personal autonomy and liberty.  Our current immigration laws violate all of those.  They are applied differently based on people’s country of birth via arbitrary quotas and other regulations, the outcomes are certainly not predictable, and they are hardly consistent with America’s traditional immigration policy and our conceptions of liberty.

For the Rule of Law to be present, good laws are required, not just strict adherence to government enforcement of impossible to follow rules.  An amnesty is an admission that our past laws have failed, they need reform, and the net cost of enforcing them in the meantime exceeds the benefits.  That’s why there have been numerous amnesties throughout American history.

Enforcing laws that are inherently capricious and that are contrary to our traditions is inconsistent with a stable Rule of Law that is a necessary, although not sufficient, precondition for economic growth.  Enforcing bad laws poorly is better than enforcing bad laws uniformly despite the uncertainty.  In immigration, poor enforcement of our destructive laws is preferable to strict enforcement but liberalization is the best choice of all.  Admitting our laws failed, granting an amnesty for law-breakers, and reforming the laws does not doom the Rule of Law in the United States – it strengthens it.

10. “National sovereignty.”

By not exercising control over borders through actively blocking immigrants, the users of this argument warn, the United States government will surrender a vital component of its national sovereignty.  Rarely do users of this argument explain to whom the U.S. government would actually surrender sovereignty in this situation.  Even in the most extremely open immigration policy imaginable, total open borders, national sovereignty is not diminished assuming that our government’s institutions chose such a policy (I am not supporting totally open borders here, I am just using it as a foil to show that even in this extreme situation this argument fails).  How can that be?  

The standard Weberian definition of a government is an institution that has a monopoly (or near monopoly) on the legitimate use of violence within a certain geographical area.  The way it achieves this monopoly is by keeping out other competing sovereigns that want to be that monopoly.  Our government maintains its sovereignty is by excluding the militaries of other nations and by stopping insurgents.

However, U.S. immigration laws are not primarily designed or intended to keep out foreign armies, spies, or insurgents.  The main effect of our immigration laws is to keep out willing foreign workers from selling their labor to voluntary American purchasers.  Such economic controls do not aid in the maintenance of national sovereignty and relaxing or removing them would not infringe upon the government’s national sovereignty any more than a policy of unilateral free trade would.  If the United States would return to its 1790-1875 immigration policy, foreign militaries crossing U.S. borders would be countered by the U.S. military.  Allowing the free flow of non-violent and healthy foreign nationals does nothing to diminish the U.S. government’s legitimate monopoly on the use of force in the Weberian world.

There is also a historical argument that free immigration and U.S. national sovereignty are not in conflict.  From 1790-1875 the federal government placed almost no restrictions on immigration.  At the time, states imposed restrictions on the immigration of free blacks and likely indigents through outright bars, taxes, passenger regulations, and bonds.  Many of those restrictions weren’t enforced by state governments and were lifted in the 1840s after Supreme Court decisions.  However, that open immigration policy did not stop the United States from fighting two wars against foreign powers – the War of 1812 and the Mexican-American War – and the Civil War.  The U.S. government’s monopoly on the legitimate use of force during that time was certainly challenged from within and without but the U.S. government maintained its national sovereignty even with near open borders.

The U.S. government was also clearly sovereign during that period of history.  Those who claim the U.S. government would lose its national sovereignty under a regime of free immigration have yet to reconcile that with America’s past of doing just that.  To argue that open borders would destroy American sovereignty is to argue that the United States was not a sovereign country when George Washington, Andrew Jackson, or Abraham Lincoln were Presidents.  We do not have to choose between free immigration and U.S. national sovereignty.

Furthermore, national sovereign control over immigrations means that the government can do whatever it wants with that power – including relinquishing it entirely.  It would be odd to argue that sovereign states have complete control over their border except they can’t open them too much.  Of course, they can – that is the essence of sovereignty.  After all, I’m arguing that the United States government should change its laws to allow for more legal immigration, not that the U.S. government should cede all of its power to a foreign sovereign.

11.  “Immigrants won’t vote for the Republican Party – look at what happened to California.”

This is an argument used by some Republicans to oppose liberalized immigration.  They point to my home state of California as an example of what happens when there are too many immigrants and their descendants: Democratic control.  The evidence is clear that Hispanic and immigrant voters in California in the early to mid-1990s did turn the state blue but that was a reaction to the state GOP declaring political war on them.  Those who claim that changing demographics due to immigration is solely responsible for the shift in California’s politics have to explain the severe drop-off in support for the GOP at exactly the same time that the party was using anti-immigration propositions and arguments to win the 1994 election.  They would further have to why Texas Hispanics are so much more Republican than those in California.  Nativism has never been the path toward national party success and frequently contributes to their downfall.  In other words, whether immigrants vote for Republicans is mostly up to how Republicans treat them.   

Republicans should look toward the inclusive and relatively pro-immigration policies and positions adopted by their fellow party members in Texas and their subsequent electoral success there rather than trying to replicate the foolish nativist politics pursued by the California Republican Party.  My comment here assumes that locking people out of the United States because they might disproportionality vote for one of the two major parties is a legitimate use of government power – I do not believe that it is.  

12.  “Immigrants bring with them their bad cultures, ideas, or other factors that will undermine and destroy our economic and political institutions.  The resultant weakening in economic growth means that immigrants will destroy more wealth than they will create.”

This is the most intelligent anti-immigration argument and the one most likely to be correct, although the evidence currently doesn’t support it being true.  Economics Michael Clemens lays out a wonderful model of how immigrants could theoretically weaken the growth potential of any receiving countries.  In his model, he assumes that immigrants transmit these anti-growth factors to the United States.  However, as the immigrants assimilate into American ideas and notions, these anti-growth factors weaken over time.  Congestion could counteract that assimilation process when there are too many immigrants with too many bad ideas, thus overwhelming assimilative forces.  Clemens is rightly skeptical that this is occurring but his paper lays out the theoretical point where immigration restrictions would be efficient – where they balance the benefits of economic expansion from immigration with the costs of institutional degradation.

Empirical evidence doesn’t point to this effect either.  In a recent academic paper, my coauthors and I compared economic freedom scores with immigrant populations across 100 countries over 21 years.  Some countries were majority immigrant while some had virtually none.  We found that the larger a country’s immigrant population was in 1990, the more economic freedom increased in the same country by 2011.  The immigrant’s country of origin, and whether they came from a poor nation or a rich one, didn’t affect the outcome.  These results held for the United States federal government but not for state governments.  States with greater immigrant populations in 1990 had less economic freedom in 2011 than those with fewer immigrants, but the difference was small.  The national increase in economic freedom more than outweighed the small decrease in economic freedom in states with more immigrants.  Large immigrant populations also don’t increase the size of welfare programs or other public programs across American states and there is a lot of evidence that more immigrants in European countries actually decreases support for big government.

Although this anti-immigration argument could be true, it seems unlikely to be so for several reasons.  First, it is very hard to upend established political and economic institutions through immigration.  Immigrants change to fit into the existing order rather than vice versa.  Institutions are ontologically collective – my American conceptions of private property rights wouldn’t accompany me in any meaningful way if I went to Cuba and vice versa.  It would take a rapid inundation of immigrants and replacement of natives to change institutions in most places.    

The second possibility is immigrant self-selection: Those who decide to come here mostly admire American institutions or have policy opinions that are very similar to those of native-born Americans.  As a result, adding more immigrants who already broadly share the opinions of most Americans would not affect policy.  This appears to be the case in the United States.

The third explanation is that foreigners and Americans have very similar policy opinions. This hypothesis is related to those above, but it indicates an area where Americans may be unexceptional compared to the rest of the world.  According to this theory, Americans are not more supportive of free markets than most other peoples, we’re just lucky that we inherited excellent institutions from our ancestors.

The fourth reason is that more open immigration makes native voters oppose welfare or expanded government because they believe immigrants will disproportionately consume the benefits (regardless of the fact that poor immigrants actually under—consume welfare compared to poor Americans).  In essence, voters hold back the expansion of those programs based on the belief that immigrants may take advantage of them.  As Paul Krugman aptly observed, “Absent those [immigration] restrictions, there would have been many claims, justified or not, about people flocking to America to take advantage of [New Deal] welfare programs.”

As the late labor historian (and immigration restrictionist) Vernon M. Briggs Jr. wrote, “This era [of immigration restrictions] witnessed the enactment of the most progressive worker and family legislation the nation has ever adopted.”  None of those programs would have been politically possible to create amidst mass immigration. Government grows the fastest when immigration is the most restricted, and it slows dramatically when the borders are more open.

Even Karl Marx and Friedrich Engels thought that the prospects for working class revolution in the United States were diminished due to the varied immigrant origins of the workers who were divided by a high degree of ethnic, sectarian, and racial diversity.  That immigrant-led diversity may be why the United States never had a popular workers, labor, or socialist party.

The most plausible argument against liberalizing immigration is that immigrants will worsen our economic and political institutions, thus slowing economic growth and killing the goose that lays the golden eggs.  Fortunately, the academic and policy literature does not support this argument and there is some evidence that immigration could actually improve our institutions.  Even the best argument against immigration is still unconvincing.

13.  “The brain drain of smart immigrants to the United State impoverished other countries.”

The results of the empirical evidence on this point are conclusive: The flow of skilled workers from low-productivity countries to high-productivity nations increases the incomes of people in the destination country, enriches the immigrant, and helps (or at least doesn’t hurt) those left behind.  Furthermore, remittances that immigrants send home are often large enough to offset any loss in home country productivity by emigration.  In the long run, the potential to immigrate and the higher returns from education increase the incentive for workers in the Developing World to acquire skills that they otherwise might not – increasing the quantity of human capital.  Instead of being called a brain drain, this phenomenon should be accurately called a skill flow.  

Economic development should be about increasing the incomes of people not the amount of economic activity in specific geographical regions.  Immigration and emigration do just that.      

14.  “Immigrants will increase crowding, harm the environment, and [insert misanthropic statement here].”

The late economist Julian Simon spent much of his career showing that people are an economic and environmental blessing, not a curse.  Despite his work, numerous anti-immigration organizations today were funded and founded to oppose immigration because it would increase the number of high-income Americans who would then harm the environment more.  Yes, seriously – just read about John Tanton who is the Johnny Appleseed of modern American nativism.

Concern about crowding is focused on publicly provided goods or services – like schools, roads, and heavily zoned urban areas.  Private businesses don’t complain about crowding, they expand to meet demand which increases their profits.  If crowding was really an issue then privatizing government functions so they have an incentive to rapidly meet demand is a cheap and easy option.  Even if the government doesn’t do that, and I don’t suspect they will in the near future, the problems of crowding are manageable because more immigrants also mean a larger tax base.  Reforming or removing local land use laws that prevent development would also go a long way to alleviating any concerns over crowding.

Although we should think of these issues on the margin, would you rather be stuck with the problems of crowding like they have in Houston or the problem of not enough crowding like in Detroit?

15.  “Some races and ethnic groups are genetically inferior.  They need to be prevented from coming here, breeding, and decreasing America’s good ethnic stock.”

These arguments were more popular a century ago when notions of eugenics and racism were widely believed, based on extraordinarily bad research, and were some of the main arguments for passage of the Immigration Act of 1924.  They have resurfaced in the comment sections of some blogs and on twitter, frequently directed at yours truly, but these types of arguments still aren’t publicly aired very often and are quite silly.  I don’t spend time engaging with them but I had to mention that they are still out there.

There are other arguments that people use in opposition to immigration.  Many of those arguments revolve around issues of “fairness” – a word with a fuzzy meaning that differs dramatically between people and cultures.  Arguments about fairness often depend on feelings and, usually, a misunderstanding of the facts that is quickly corrected by reference to my 8th point above.


Mike Ballard said...

The CATO institute wants to keep downward pressure on real wages in order to increase the capitalists rate of profit. Real wages are now below what they were in 1964 before the massive influx of non-citizen workers into the USA. Labour power is a commodity. Flood the labour market and you lower its price. CATO knows that and continues to serve the class interests of the employing class.

ajohnstone said...

i won't dispute your analysis, Mike. In various previous posts you have raised similar arguments against the free movement of workers. CATO and the capitalist class have their own agenda when it comes to immigration, which cannot be denied and i have no wish to. There is, however, an overlap of interests, though. Mobility of labour was one of the freedoms from serfdom and the baron's estate that the toiling class achieved through the development of capitalism.

The point of the blog was to post some facts that counter much of the anti-immigration sentiment of indigenous workers. If you wish to challenge the actual details, by all means do so but sometimes,as Marx often did, he cited the evidence of the employers and the government to bolster his own case against capitalism.

There will always be competition for work between workers and the employing class will always create a reserve army of the unemployed. These are inherent characteristics of capitalist society. Divide and rule. They won't disappear until capitalism is ended

When it comes to defending the working class...just which part is it we defend? Would we have opposed the migration of african-americans from the cotton fields of the South to the factories in the North? Would we have placed barriers on the Californian state-lines to the Okies fleeing the Dustbowl? When the Scots and the Irish and the Welsh and the Geordies and the Scousers moved to the Midlands and Home Counties, should the local workers have sent them back, denied them houses, denied them jobs to maintain the labour shortage that benefited them in pay and conditions?

It is the general interests of the world's working class that socialists endeavour to advance and sadly there will always be sectional conflicts arising. The beginning of the 20th century was a history of the skilled/craftsmen against the unskilled as machinery was simplified and jobs deskilled. We still suffer the legacy of the male dominated industry's pay differentials bias against women. Also remember the union closed shop, i just happened to be reading an article from the 1950s from our internal discussione magazine defending them as a necessary tactic of workers trying to gain from the employers, even though it was at the expense of other workers...collateral damage - so to speak.

Anyways, been a while since you last commented. I was recently wondering if you still visited the blog.

Mike Ballard said...

What I'm concerned with is the workers knowing what the score is and the score is Capital won, workers zero. The workers need to be told that their instincts are right about the market being flooded with immigrants and how that plays into the social relation of Capital. They need to know that labour power is a commodity. You need to tell them that and stop lecturing them and me about our immorality or how we somehow control the political State's immigration policy.

Of course, workers need to establish social ownership and democratic control over the collective product of their labour. But they're not going to do that by being morally cajoled by the left or hoodwinked by the right. The least you could have done was to point this out before blandly putting out CATO Institute mind manipulations.

ajohnstone said...

'mind manipulations"… I did invite you to challenge any of the stated facts' accuracy. CATO did not invent such information but like this blog has done in the past just collated the statistics and research to support our message.

We did identify in our introduction that CATO was a conservative think-tank and we were grateful for you high-lighting that they had their own motives in using the facts and figures they have simply repeated.

It would be easy for us to say that we do not take sides but we do sympathise with the more vulnerable, the more powerless and the more defenceless. Migrant workers are threatened by a coalition of right-wing xenophobes, the coercion of State agencies, and unscrupulous employers, all who are trying to gain the popular support of our fellow-workers by the genuine mind manipulation of either false or magnified fears.

It is incumbent upon the blog to try and dispel such scare-mongering and scape-goating for the troubles and problems of local indigenous workers. It is not as if we neglect exposing those. But you may have a point that our blog-posts may seem like moral lectures but if we feel fellow workers are sowing division and not expressing solidarity – we must find another style of saying so that does connect more with our audience and promotes the unity of interests rather than the current dog-eat-dog rivalries.