Tuesday, July 11, 2006

Immigration and Political Biases in Economics

This week’s New York Times Magazine attempts to introduce real economic analysis into the immigration debate (available free until Sunday, email me after that). The article is a lovely introduction to the basic theory, however the main focus is the split between George Borjas of the Kennedy School and David Card of Berkeley, which is threatening to turn ugly.* It’s a reminder that personal political biases are pervasive.

The author, Roger Lowenstein, notes, “You can find economists to substantiate the position of either chamber, but the consensus of most is that, on balance, immigration is good for the country.” The interesting thing about the debate within labor economics is the lack of distance between the camps. Everybody agrees on the theory, and the signs on the different economic analyses are all the same. As Lowenstein says, “The debate among economists is whether low-income workers are hurt a lot or just a little.” How economists come down on that question depends on their political and economic biases. Lowenstein seems to impugn Borjas the most for his anti-immigration bias, but I think Lowenstein’s own bias is towards free-market economics, as is David Card’s. Most economists are biased towards free markets (which I think is a pretty good bias to start from), but this leads them to downplay the social significance of immigration’s impact on low-income workers.

As a Native American, my own bias is strong. You might even say that I get rather pissy when I hear anti-immigration rhetoric. What, you mean the borders are closed now?** I have no love for an American culture that doesn’t welcome the striving and the downtrodden alike.

In the end the debate over immigration is a distraction from the real issue: how are we treating low-income workers in our country? Are we ensuring that they have a real opportunity to better their situation? Are we ensuring that their children have the ability move up in the world? If we address inequality of opportunity in this country—I might suggest through universal health care and better funding for education—then immigration becomes a much less important issue. The American economy has an astonishing ability to absorb immigrants, and, in my ever humble opinion, a moral imperative to do so.

*Is it only me that loves to see two labor economists have at it?
**See also the
Op-Ed Contributor from July 9, on the Hispanic history of America and the “poetic justice that now the Hispanic world should return.”


C.L. Hanson said...

I wish there were some way to stop or slow this "race to the bottom" in terms of worldwide social/environmental protections. Immigration would then be a very different issue...

SAM-I-am said...

I get down about this too, but when I look at our history I can see the swings, which lets me believe we are just at the extreme of a pendulum swing. Deepak Chopra (who I usually think is rather cheesy) has a blog post encouraging us not to lose hope, and I choose to let it comfort me rather than sink into depression or disconnect from the world.

Anonymous said...

I'm not sure I agree that fixing the social contract would improve the immigration debate. In fact, it would probably make it worse. The straw man argument is that immigrants consume too much of our social safety net. If there was much of a net, this argument might begin to make sense. The problem with immigration is that people are fleeing from disfunctional states. The solution is Marshall program like investment in Latin America, and perhaps SA as well. Propersity in Mexico and Guatamala would solve the immigration problem, and strength our economy and security at the same time.


C.L. Hanson said...

Hey JSM, actually what I meant was that the immigration debate would be different if the social contract in other places could be fixed, so that people wouldn't be fleeing those countries. This is unfortunately an extremely difficult problem to grapple with...

SAM-I-am said...

It's true that better social supports in the U.S. would lead to more illegal immigration. But in case you hadn't noticed, I don't think that's much of a problem. The American economy is astonishingly good at absorbing immigrants, and creating jobs that did not previously exist.

I'm concerned with the ability of native low-wage workers and immigrants alike to climb the social ladder, so that we don't create a permanent underclass.

Marshall plan in Mexico, etc. Dream big, eh? We're all with you there.

SAM-I-am said...

Not that I'm arguing for open borders. As Milton Friedman said, "You cannot have both open borders and a welfare system."

But we don't have much of a welfare system anymore, and our borders are not entirely open. They're more like the doors to a canal lock, keeping the levels distinct but allowing a steady flow through.

Don't forget that many illegal immigrants pay taxes under their fake documents, nearly all are working very hard, many are sending money to family back home, and most(? I need figures) have some family who are here legally. I don't mind increasing border security, but we need to have more respect for families and not make seeking a better life a felony. And wish I had a short-term solution for the impact on border states, especially w.r.t. health services and education, but I think it's immoral to deny health care and education access to illegal immigrants, especially to children. Health care and education are good investments.