Friday, September 1, 2017

Labor Day and the Truth about Immigration

It’s September 2017 and there is still no funding or plan to build Trump’s wall along the Mexican border.  While earlier this week Trump said he would not go along with raising the debt ceiling unless there was border wall funding (I guess US taxpayers pay for it and then we bill Mexico?), he eventually again backed off from this mandate.  No surprise.  The 140-character Twitter presidency says lots of things to get supporters and opponents hot and bothered, only to see no follow up by Trump or even reversals by his staff (think of the Defense Secretary temporarily halting the ban on transgenders in the military).

Immigration persists as a tough political issue for both Republicans and Democrats.  Republican failure to support immigration reform is a way for them to dig their own graves with future Hispanic voters.  The party needs to give on this issue but its current aging and xenophobic base makes that impossible.  Instead, Republicans call for a wall along the Mexican border, or for laws to allow for law enforcement to simply stop and detain individuals whom they think are illegal.  This is what Sheriff Arpaio did and with Trump’s pardon, he got away with it.  The State of Texas wants to go after sanctuary cities and a judge has put a halt to that, and of course Trump’s immigration bans have significantly been weakened in Court.  They exist mostly as media sound bites, although they do hurt some people.

Immigration is the new race word.  At one time, affirmative action, crime, or desegregation were code words for racism.    You could not respectably run as a racist so those issues were surrogates for race.   Immigration is the same, except now it seems that it is okay to run as a racist, or at least let the racism come out.  But all this beg a question—Why the fear of immigrants?

In general, especially in tough economic times, the argument is that immigration and immigrants take jobs away from Americans and serve as a drain on the economy. They are often singled out as competing against American citizens for jobs or that they cost taxpayers money. There is a belief that the benefits of citizenship, the free schools, and other programs found in the United States operate like a lure to attract illegal immigrants to the United States.  Allowing them to work in the United States, get a driver’s license, the availability of schooling, health care, and citizenship for children, or even lax enforcement of immigration laws, sends a signal to them that they are welcome. Thus, immigrants—documented or not--flock to the United States and something needs to be done to stem this invasion.

                What is the reality?  Are immigrants a net drain on the economy; specifically, are they a bigger drain on taxes and public services than they are overall contributors to the economy? Second, immigrants are depicted as taking jobs away from Americans. What do we know about both of these claims?
First, while acknowledging that immigrants may in some local settings or jurisdictions place some short-term significant burdens upon public services, overall, they are net contributors to the economy. Several studies substantiate this point. The 2005 Economic Report of the President provided a detailed analysis of the impact of immigration upon the United States economy. The report noted that they as a group had up to a $10 billion net positive impact upon the economy. The report noted, for example, that while immigrants may be more likely than native born Americans to be on public assistance, the “net present value of immigrants’ estimated future tax payments exceeded the cost of services they were expected to us by $80,000 for the average immigrant and his or her descendants.”  However, with changes in public assistance laws, that figure had been upped to $88,000. While better educated immigrants (high school degree or better) definitely reflect this contribution, even among those not as well educated, the gains from them and their descendants’ productivity nearly, if not totally, offset the costs they impose upon public services that accrue to state and local governments. Finally, the president’s report also provided other documentation regarding the impact of immigrants upon the economy. For example, it noted that immigrants paid Social Security taxes on income of $463 billion dollars (108). Moreover, because many immigrants cannot collect Social Security, it is likely that immigrants overall pay more into this government program than they receive from it.

In addition to the President’s 2005 report, other studies have noted the net economic benefit of immigrants to the United States. A 1997 National Academy of Sciences study found several net benefits associated with immigration, including a $10 billion net positive impact on the economy. Brad Edmondson’s “Life Without Immigrants” found that: “Illegal aliens in prison cost about $471 million per year, and they consume about $445 million more in Medicaid funds. But these costs are offset by about $1.9 billion in taxes paid by illegals and billions more in consumer spending.” Furthermore, the National Academy of Sciences, President’s Report, and the Edmondson study, all indicated that younger workers provided for important sources of productivity that also served the economy well. Overall, these and other studies clearly contested the myths that immigrants were a drain on the economy.

In general, broader studies on immigration in the United States also confirm that there is a net benefit of immigrants to the economy. They generally pay more in taxes than they consume in public services. They have provided critical payments to Social Security to help maintain its solvency. Heidi Shierholz  in Immigration and Wages: Methodological Advancements Confirm Modest Gains for Workers found that even native US citizens have seen modest gains in terms of wages as a result of immigration. More importantly, California, Florida, New York, and Texas, the states with the highest immigration, seem to have particularly benefitted from it. Others reach similar conclusions about the impact on workers while noting that the granting of amnesty to undocumented immigrants has benefitted the economy and increased tax revenues to the United States.
The second criticism leveled against immigrants is that they take jobs away from American workers or they negatively impact wages. Again, several studies refuted that. For example, the National Academy of Sciences study found the wage impact to be negligible, while the President’s Report found little impact on wages of native Americans. The report also noted and dismissed the argument that immigrants displaced American citizens in the labor market. Instead, they often filled labor gaps abandoned by others, such as farming and agriculture, and they definitely constituted a new source of productive labor particularly at a time when the size of the labor pool from other workers had disappeared.

In addition to the above a Pew Hispanic Center study reached similar conclusions. It compared the economic growth in selected states with high versus low immigration and found no differences in economic growth or in its impact on the labor markets. It also found that there was in fact in 12 states a positive correlation between the growth of immigrant and native-born workers. By that, there was no evidence that in states where more immigrants entered the labor market it depressed the entry of others into work. Finally, even among immigrants who were young and lacking in education, there was no indication that they directly competed against and hurt native-born workers with similar background.
                In sum, the evidence that immigrants are financial drains on the economy and that they take jobs away or hurt the wages of native-born workers is simply false.  Attacking immigrants and blaming them for society’s problems goes a long way back in American history, and the reasons for this animus lie can only be explained on xenophobic or racist grounds.
                As we enter the Labor Day weekend it is possible to be pro-America, pro-worker, and pro-immigrant.  The US economy is stronger because of immigrants and workers are not hurt by them.  The causes of why working Americans are losing ground in many cases has to do with technology and the failing economic policies embraced by both Democrats and Republicans over a 40 year period.

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