Tuesday, May 07, 2013

Illegal Immigration; Not an Economic Debate

Check out this article by Jason Welker about the Economics of Illegal Immigration. It is a refreshing take on an issue that has gotten a great deal of publicity recently. What are your thoughts after reading the article? Is this different from what you have been hearing from both the Republicans and the Democrats lately? Leave your comments before Sunday at midnight.


Illegal Immigration is not an Economic Issue:

Because if it were, there would be no debate at all. Immigration, from an economic standpoint, is simply the flow of labor from one geographic region to another. I’m not talking about the kinds of immigrants who arrive in America or Switzerland or the UK as refugees fleeing political, religious, gender or racial persecution. Such asylum seekers have motives that are entirely non-economic for fleeing their homelands. I’m talking about the millions of people every year pack up their homes and seek a new life in a new country for economic reasons.
America has been called the “land of opportunity”, and for nearly five centuries now the opportunities the New World has had to offer have attracted immigrants from all corners of the globe. First it was the Spanish and the Portuguese who came in conquest in search of gold and silver. Later came the pilgrims seeking religious freedom, and after that the Irish, Italian, Germans, Russians and countless other Europeans seeking the economic opportunities offered by the construction of railroads, homesteads on the Great Plains and gold in the mountains of the West. Chinese arrived by the millions from the 1850′s through the turn of the 20th century, and over the past hundred years America’s racial, ethnic, religious, linguistic and cultural fabric has been enriched by the arrival of millions upon millions of people seeking the economic opportunities America has had to offer. The opportunities of the 21st century no longer involve the hope of striking gold or working on the railroad, rather they exist in industries such as software engineering, medicine, scientific research, finance and, yes, agriculture and construction.
It is interesting to me that in the United States today, American citizens and politicians seem to be as angry as ever about the seemingly endless flow of “illegals” flooding across the American border, bringing with them crime and contributing to unemployment among American workers already struggling to find jobs during the country’s deepest recession in decades. If you believe politicians like the governor of Arizona, Jan Brewer, this “invasion” of illegals from south of the US border is simply tearing apart the fabric of American society. Her state has even gone so far as to pass a law requiring police officers to require anyone who they suspect of being “illegal” to present proof of their legal status upon the officer’s request. Other attempts by states to crack down on illegal immigration include laws forbidding landlords from renting apartments to illegal immigrants and on a national level there is a major push to change the US constitution, in which the 14th Amendment states that any child born in the United States is automatically a US citizen. Imigration opponents claim that millions of Latinos enter the US illegally to have babies, which they call “anchor babies”, who become US citizens and then, supposedly, later in life, help their parents become legal US residents.
The protest against illegal immigration has dominated the right wing agenda in America lately, and has brought angry Americans to the street for rallies across the country aimed at sending illegals “back to where they came from”.
The irony of the whole situation is that today, in the midst of the Great Recession, immigration rates are falling rapidly. The number of immigrants entering the United States illegally has actually fallenby 67% in the last few years, from 850,000 per year between 2000 and 2005 to under 300,000 in 2009. Even more ironically, the number of illegals leaving the United States now actually exceeds the number entering the US, meaning that the total number of illegal immigrants (around 11 million in 2009) is decreasing and is lower now than it has been for much of the last decade. The Washington Post presents the facts:
From an economic perspective, the backlash against illegal immigration to the United Sates right now is perplexing and frustrating. Americans currently find themselves in a dire economic situation in which over 8 million people have lost their jobs, the unemployment rate is stuck at a historic high of nearly 10%, and discouraged workers have dropped out of the labor force at alarming rates, meaning that almost one in five Americans is either unable to find work or has given up the search. Clearly there is much to be upset about.
But all the facts above send a clear message to potential illegal immigrants to America, as well as to those who are already here! The message is, “DON’T COME!” (or for those who are already here, “maybe this is a good time to leave!”). Some of the decrease in the flow of illegal immigrants can probably be attributed to tougher border security and increased enforcement of the existing immigration law. But it’s more likely that the decrease in the illegal population is an economic phenomenon. Here’s why:
America purportedly practices a system of economics known as a free market. The fundamental characteristic of the free market system is that resources are allocated efficiently when they are allowed to flow from markets in which they are in low demand to markets in which they are in high demand. Price is the signal that tells resource owners where their resources are demanded the most. When we are talking about immigration, the resource that is flowing from market to market is labor. In a free market economy, there should be no government controls over the free flow of labor from one market to another. When the price of labor in one market (say the apple industry in Washington State or the construction sector in Arizona) is higher than in another market (say the corn industry in Mexico or the retail sector in Guatemala), the signal sent by this imbalance of wages is that more labor is demanded in Washington and Arizona and less is needed in Mexico and Guatemala.
The imbalance of wages between the US and its closest neighbors leads to a natural inflow of labor from low-wage countries to the higher wage industries in the United States. It’s a form of osmosis, which according to Wikipedia is “the movement of water across a partially permeable membrane from an area of high water concentration to an area of low water concentration… which tends to reduce the difference in concentrations”. Instead of water, immigration is osmosis of labor. Labor is more abundant in Mexico and Latin America than it is in the United States. The flow of labor across America’s “semi-permeable” border with Mexico simply “reduces the differences in concentration” of labor between the US and its southerly neighbors.
Making it harder for immigrants to come into the United States does little to protect American jobs. One thing I teach my students is that in a world where labor is not able to be imported (i.e. one where immigration is stemmed or slowed down), we should expect to see capital exported. A higher border fence with Mexico or more immigration police or a repeal of the 14th Amendment may reduce the number of people coming to the United States to find work, but these barriers to immigration will do nothing to stop the flow of capital to Mexico and the rest of the low-wage world. If Americans want more jobs to be done in America, then they should embrace those who are willing to do them, otherwise those jobs can be exported to where the wages are lower and people are willing to do them. If labor is immobile, capital will grow legs!
The immigration debate is not an economic debate. It is a political one. From a purely economic perspective, with the efficiency of free markets as a guiding principle, the free flow of labor across national borders improves overall efficiency of both the countries from which the immigrants come and the country in which they arrive. American workers are only marginally affected by the presence of illegal immigrants in the United States. Several studies have shown that while employment among certain Americans is affected slightly, there is no evidence that illegal immigration puts downward pressure on American wage rates. Jobs that might not even exist in America without immigrant workers willing to work for low wages do get done thanks to immigration, and the American economy is stronger and healthier because of this.  Without immigration, those jobs will still get done, just not in America! Or, if the jobs can’t be exported, they’ll get done but at a much higher cost, raising prices for American households and reducing the real income of the American people.
In economic terms, increased immigration allows the United States to have a comparative advantagein the production of a broader range of goods and services than it would have without immigration. Since in a global economy, what a nation’s economy produces is determined by what it can produce at the lowest opportunity cost, the more low-wage labor America has to employ, the larger it can expect its economy to be and the greater number of exports it can expect to sell to the rest of the world.  Immigration is overwhelmingly positive for the American economy, even illegal immigration. If it weren’t illegal, it would happen anyway, just more of it, which again would only make the US economy stronger and its output greater.
Again, these are all mute points in the current American debate over immigration, because the fact is that the net flow of illegal immigrants is actually negative right now. NPR reports,
Signs are pointing to stabilization on the border… as a still-sputtering U.S. economy and high unemployment continue to contribute to the over-the-border slowdown. Estimates suggest that the U.S. economy has lost 8 million jobs in the downturn, including 4 million manufacturing and construction jobs over the past three years.
The free market offers the perfect solution to the illegal immigration debate in the United States. Let it be! If America doesn’t need more labor, then labor will not come to America, and some of that which is already here will leave. But once the US economy begins to recover and the demand for labor begins to grow once more, let it be! Instead of building higher fences and hiring more border police, find ways to make it easier for workers to enter the country and fill the jobs for which they are demanded. America will be stronger for it! After all, if we don’t embrace the inflow of labor, we better be prepared for an outflow of capital. And as even my first year IB Econ students can tell you, a decrease in the labor force and the amount of capital in a nation is a recipe for economic contraction, recession and declining standard of living among that nation’s people.
Is that the America we want to see in the future? Would America be the land of freedom and opportunity today if it had kept out immigrants throughout its history instead of embracing them and incorporating them into American society and the US economy? I doubt it. So, America,  end the debate… because from an economist’s perspective, it was over before it even began!

43 comments:

Ann Johnson said...

This article is very different from what we all here today on the news from Democrats and Republicans. Most people have two view points on immigration but however this article stresses the importance of immigration on the ECONOMY which every one wants the best of. I thought this was a good article that everyone should read and fully understand how immigration effects the economy.

Paula Salmon said...

I think that this article by Jason Welker does have a point. Immigrants can help the economy and it is very true that the United States was based on immigrants coming from many different countries. I had already heard some of this point of view on the whole immigration issue somewhere else. What really surprised me, however, was the fact that the illegal immigration rate was going down over the past few years. I haven't heard that from either political side in this argument. I really liked how the article put the whole argument in terms of the economy. Although, there are some arguments that I have heard that he didn't address. Overall, this article was pretty informative and intriguing.

Stephen Harris said...

Economically, it appears that immigrants can primarily only help the American economy. Considering the economic advantages that the United States could receive by accommodating immigrants, the uproar over illegal immigration seems to have more to do with political gain than with the actual economic benefits the United States could receive. After all, illegal immigration to the United States is decreasing, and nowadays many Americans would be unwilling to perform the often dangerous jobs completed by immigrants.

Alexis Buck said...

Alexis Buck.

From reading the article that Jason Welker has written, he has made an outstanding point when it comes to illegal immigrants across the border from different countries, especially Mexico. The thing that people don't realize, that Jason addressed, was that bringing more people in does not secure American jobs for just Americans because some Americans demand higher wages for jobs that immigrants would happily work for that minimum wage. We get insanely greedy when it comes to how much we are willing to get paid for a minimal amount of work effort, and Jason makes a good point that it matters about capital that is being exported, not about the population gradually rising. Furthermore, another point he addressed is the fact that American jobs are secured based on the economy, not the illegal immigrants "stealing" their jobs. If a businesses' profit is declining and the leftover profit they have is going to their employees, they are obviously either going to lay off workers, or reduce their pay to make up for the difference. He even provides proof from the decrease in the immigration rates and the realization that some jobs are done by immigrants because no one else is willing to do them.

This article definitely crashes with Republican and Democratic debates, because most immigration laws don't stress the impact it has on the economy, but rather a social impact immigrants have. (like drug cartels, violence etc.)

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Kevin Guo said...

I think that this article by Jason Welker is very difference from what we hear everyday from the media and the government. Most people in America believe that immigrants are effecting the daily lives for people in America, and it is very true that the United States's economy is based on immigrants from many different nations around the world. The thing that surprises me the most is the fact that illegal immigrant rate is decreasing over the past few years. Most people, including myself would believe that illegal immigration is increasing, but in fact it is not. I think it is a good article that could have the reader fully understand how immigration have an effect on this nation's economy.

Unknown said...

This article by Jason Welker is quite different compared to what we hear from current Democrats and Republicans. He points out a lot positive aspects about immigrants, but one point that he focuses on the most is that these immigrants are actually a good thing because they help stimulate the economy. They help with many parts such as labor, politics, etc. One thing that I wasn't expecting is the number of immigrants are decreasing over the last couple years. I would've expected the number to be increasing because more people usually come to America to seek a better opportunity. But you also have to take into account that many other countries are developing quickly also. Overall, he provides many arguments to support that having immigrants is a positive thing.

Dana Rodriguez said...

This article discusses the very logical reasons behind immigration and it’s effect on America and her economy today. It shows more pros to immigration then just the basic cons we hear from the Democrats and Republicans on the news. It also discusses the enforcement states are undertaking to decrease illegal immigration, which in turn has been successful in the past few years. This is article is quite eye opening and informative.

Josh Ortiz said...

I think that despite the benefits that immigration can have on the economy, we still need to control who comes into this country. We already have enough people here, and the immigrants are usually in poor financial conditions, which typically correlates to having more children per family. As I said earlier, we already have a lot of people here, and world population is a separate issue of concern. We don't need to add to this problem by allowing uneducated and underprivileged people to come into our country.

Beth Sutton said...

I knew that immigration has been a major topic for debate in this county the past few years, but I did not know that the immigration rate is actually falling. From the way both Democrats and Republicans talk about it, you would think that immigration rates are rising, not falling. However, I did know that illegal immigrants don't contribute to the unemployment of Americans as much as politicians would like everyone to believe. Why wouldn't a country as great as America want to open itself up to the flow of new and creative minds from other countries? It makes me mad that a country born from the blood of so many different cultures and peoples is now being run by selfish and close-minded individuals.

Emil Simon said...

Jason Welker reveals a little known truth through this article. Immigrants do the jobs that rest of America neglects to do. The eventual benefit of the economy via immigration is an emphasized idea in Welker's article. This article is completely different from what is heard normally. Society says that immigrants steal American jobs, leaving American families in poverty and despair. Welker definitely goes out of his way to prove that myth wrong.

Savannah Milligan said...

After reading the article my perspective on illegal immigration has completely changed. I grew up in a household where adults griped that they were "stealing American jobs," but the article does present some valid points. Immigration is actually a plus for our national economy.

Jay Shah said...

In my opinion, Jason Welker's article is different than what we here from Republicans and Democrats, as it focuses more on the benefits of the illegal immigrants. Also, the focus that the two parties put into this issue would give us the assumption that immigration is actually rising and we can't control it, when in actuality it is going down (although I wonder how they keep track of how many illegals are coming in and out). It is hard for me to grasp this concept, as even in the recession, they have a better chance to get a job here than in the country they chose to leave. However, I think in midst of this recession, nationalism is actually rising,, and the corruption of companies who would hire illegal laborers at cheaper wages probably went down too.

Joshua Gicana said...

My thoughts after reading this particular article is that Jason Welker serves a very perspective attitude towards immigration. Although, there is a definitive positive to immigrants serving and helping the economic problems of the state, there are problems. My view on immigration is so so as I hardly care about it. I haven't really kept up with immigration. Though the article is very specific and serves a good point in telling a story.

Nico Teran said...

Immigrants can definitely be considered a contributing factor to the fluctuations of this nation's economic performance. I had not known that the immigration rates have actually been decreasing in recent years because politicians continue their rants on the blown-up negatives of the immigrants' presence. In fact, immigrants are the basis of the nation. Many Americans are unwilling to do the manual labor that many of the illegal immigrants are grateful to do. Nevertheless, after reading the author's responses to a couple comments left by others, I am able to recognize that the movement of immigrants to this nation is not, holistically, a negative. The work and efforts of immigrants can help the nation get out of the cyclical recession by increasing the overall production processes. This article successfully points out many if the little-known facts and truths about the negatively-perceived immigration.

Brandon May said...

Although the previously vast number of illegal immigrants may have been alarming and disconcerting, I feel that efforts to end illegal immigration are a waste of time until the economy makes a turn for the better.

With a net outflow of illegal immigrants (according to the article), the "problem" will eventually solve itself should we stay in a recession for an extended period of time.

Moreover, the apparent positive effects of labor inflow on our economy suggest that we should allow some amount of this illegal immigration to continue, though it may be beneficial to regulate it in some form. Republicans have been extreme in their anti-illegal-immigration efforts.

Tyler Powers said...

Although it is a great article, I completely and utterly disagree with him. One of his main arguments was that America has always been able to have people flow in and out of America. Hello, the quota system that ruled from the early 20th century to 1965 or the rules we had against the Chinese that ended in 1942. Okay, I am totally against limiting people who come here LEGALLY, but we should make it more difficult to come here illegally. The jobs that the illegal immigrants are taking are stealing from the youth of America who is seeking their first jobs. It should not take people like myself or some of my friends between 6 months and 2 years to finally find a job. Yeah it may give us advantages compared to other nations, but it is harming Americans who are willing to take minimum wage to be employed. Legal immigration is a must because with out immigration America would not be America. Yes, we would have won the war but with the German Refugees from World War Two the war may have lasted much longer and more American lives would have been lost.Also, I think we should redesign the 14 amendment and make it say a child born in America is a legal citizens if their parents are either citizens or are here legally. If a baby is a child of illegal immigrants, then their children are also illegal. We give more money to go to universities than the middle class and other communities that deserve it more. Legal immigration must continue, but we must crush illegal Immigration with a firey fist because it is much more that a political issue, it is a economic issue that is destroying the fabric that makes America great.

Albert Wang said...

Though illegal immigration has some negative attributing factors , I think that the U.S. needs to embrace all immigrants… after all, America is a nation of immigrants. The fight on illegal immigration is pointless; it takes away from our resources and makes it more difficult for those willing to work undesirable jobs to get those jobs. In addition, increased illegal immigration allows the U.S. to have a comparative advantage of goods & services than it would have without this immigration. I did not know that the immigration rates have been decreasing because political figures talk about the "rise of immigration" putting a strain on our nation's employment, etc.

jackie miller said...

If immigrants were allowed to legally flow into The United States’ workforce why wouldn’t they be able to receive the government mandated minimum wage that Americans receive? The lower paying jobs the author says that support a thriving economy would not exist. He also says that Illegals keep American businesses from farming out jobs overseas, and it boosts the overall economy. I don’t understand that because the illegals are not supporting the United States since they don’t pay taxes; however, they still receive many benefits from just living in the U.S. I don’t think the small amount of money that is fed back into the economy via their wages substantiates the expenses the workers and their families incur to the taxpayers.

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Chris Gallagher said...

This article states many good reasons for why immigration is beneficial to the economy as opposed to negative reasons. I know the Republicans are highly opposed to the idea of illegal immigration which contradicts the statements that Welker makes in his article. Even though the increase of immigration can be beneficial to our country's economy I still believe that there needs to be regulations on it. I don't like the idea that illegal citizens are taking the jobs away from American citizens who are unemployed. I was surprised at the fact too that more immigrants are actually leaving the country rather than entering it.

Unknown said...

I believe the article took on the issue of immigration through an interesting perspective. I already knew some of the details in the article, but the article gave specific statistics. For example, it pointed out the decrease of net immigration in our country. The article also looked at immigration from a free market perspective instead of a human rights issue. This allows for many more conservative or libertarian individuals to embrace immigration reform. The article leaves out some of the political rhetoric associated with immigration and focused on fact. In Washington, immigration is discussed almost strictly part lines. I believe the circulation of these ideas can persuade many congressmen to address the immigration problem in America. Immigration reform can be seen as the true American solution, instead of an isolationist view. Free markets and a free flow of immigration is not only the American way, but also the capitalist way.

Unknown said...

I believe the article took on the issue of immigration through an interesting perspective. I already knew some of the details in the article, but the article gave specific statistics. For example, it pointed out the decrease of net immigration in our country. The article also looked at immigration from a free market perspective instead of a human rights issue. This allows for many more conservative or libertarian individuals to embrace immigration reform. The article leaves out some of the political rhetoric associated with immigration and focused on fact. In Washington, immigration is discussed almost strictly part lines. I believe the circulation of these ideas can persuade many congressmen to address the immigration problem in America. Immigration reform can be seen as the true American solution, instead of an isolationist view. Free markets and a free flow of immigration is not only the American way, but also the capitalist way.

Nic Vigil said...

This article is actually pretty surprising. Plenty of politicians cover the huge dilemma of illegal immigration but many have failed to address the fact that we are actually losing illegal immigrants faster than we are gaining them. Besides, the article claims that there are certain economic benefits to illegal immigration so I do not see why so much legislation should be put in place to prevent it.

The only concern of mine is the drug trafficking associated with illegal immigrants and the Mexican cartels. Illegal immigration needs to be blocked if it involves individuals who will bring harm and violence to our streets.

Payton Dugger said...

After reading this article i believe that yes, there are positives to immigrants serving and helping the economy and problems that the US face but there are also negatives. This serves as a viewpoint that everyone can see and is very different from what we would normally hear about immigration.

Jeralyn Laran said...

After I read the article, it only enhanced my perspective of immigration. America is known for being the "land of opportunity" and different people have traveled to America for that. The article states many reasons as to why immigration is beneficial to the economy, rather than focusing on the negative aspects of it. As for Republicans and Democrats, I have heard them only speak of the negative things immigration has to offer instead of what it can to to our economy.

Logan W said...

The article stated valid points as to why immigration is good for the economy. Even though an increase in immigration can be helpful to the U.S. economy there still needs to be a specific policy on it. I was also amazed to hear that more immigrants are actually departing from the country rather than entering it. This article is also completely different from what is heard normally in society and on the news.

Milan Doshi said...

I think the immigration debate has become muddled over the last few weeks and even months due to the sentiments which are attached to events which have occurred across the country. I disagree with the article when it says that the immigration debate is not an economic debate but rather a political one because it takes valuable tax money to allow illegal immigrants to stay here in the United States. My thoughts are that entering this country should become a lot easier. If illegal immigration is currently down, why not allow immigrants who are trying to enter the country to come in higher numbers. The more people, from more places, with more diversity we are able to accept into this great nation, the more we will come to accept others, the stronger we will be able to collaborate with others, and the further America will succeed when it comes to innovation. We have illegal immigrants filling some of the most intellectual jobs in medicine, technology, and business. America should want these individuals to contribute to the bright future we have ahead for ourselves! Ultimately, I think the immigration debate is a debate which has so many factors and nuances involved both in the policy making process and the repercussions which follow after that it makes coming up with a cohesive policy or argument for one side or the other difficult.

Brittany Kuusito said...

This article provides much new insight into positives for immigation. I have personally been against it, but with American being the land of opportunity we should not take that away. There should be regulations and requirements, but everyone should get an equal chance. This article make me rethink my stance.

Michelle Kuo said...

I definitely feel that America should remain open to immigration. Afterall, America does take on the great identity of a melting pot. The fact that immigration rates are falling actually worries me. Plus wouldn't cultural immigration and diversity lead to a greater economic network as well? I don't see any reason to regulate/control immigration.

Saket Jha said...

This article provides interesting perspectives that are not usually considered when discussing the issue of immigration. I was surprised to learn the falling numbers of illegal immigration. The view presented in the article is different than what you hear from the parties in that it puts more emphasis on the economical aspects of immigration, which are way too often overlooked.

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Kyle Robinson said...

Immigration to most Americans is always percieved as something that is increasing, the fact that this article has informed us that it is decreasing suprises me. Although,I think immigration is still something that needs to be watched closely. While this is the land of opportunity for most individuals from outside countries, we do need to have regulations. This article provieds interesting views on how immigration does, in fact, help our economy, it is actually refreshing to see a new perspective put on a very hot topic.

Bryan Mayorga said...

Immigration is and will always be a major topic in the United States. People who come to the U.S. is normally a help to the economy, not including things like cartels, etc. Some people might think that most people that cross the border are:
1. Mexican, and only Mexican
2. uneducated
3. underprivileged
Normally, only 2 and 3 are correct, but the only thing that makes 2 plausible is the fact that number 3 is correct.
Like I previously stated, immigration is and will always be a major topic in the United States.

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Carlo Ruano said...

Immigration does pose a positive effect on the economy, but what really surprised me was the common social idea that of immigration increasing in our country, yet in recent years has decreased. The general application to the economy was like the neutral ground between the republican and democratic arguments, but overall for immigrants this country being the land of opportunity makes the more dangerous jobs more viable than what most Americans would want to do.

Jared (Big Money) Yust said...

I do not believe in immigration. It is a poor excuse for drug cartels to conduct business here in the states. That is how they help the economy. By bringing in millions of dollars in Heroin, Cocaine, Chocolate, and Cannabis for our kids to abuse. It's destroying our country and it needs to stop.

Corey H. said...

I think that immigration is a necessary part of our economy because, as stated in the article, many jobs either would not exist or would not get done without the willing immigrants who perform them now since many people veiw these as tasks that are too menial to perform for a living.

Thia viewpoint is from the views of the two political parties who want to keep America a place for people who they feel deserve to be here.

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