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Economics Favor More Immigration, Not Less, Speakers Say

12 Jan

By Laura D. Francis

Jan. 8 —  Despite the current political rhetoric surrounding immigration, economic studies for the most part find that the U.S. stands to make strong economic gains from increasing rather than decreasing immigration, speakers said Jan. 6.

“The gains that economists predict from moving to a world of open borders are just jaw-droppingly staggering,” according to Benjamin Powell, director of the Free Market Institute at Texas Tech University. Powell, who is also a Texas Tech economics professor and senior fellow with the Independent Institute, spoke during an event sponsored by the libertarian Cato Institute about The Economics of Immigration: Market-Based Approaches, Social Science, and Public Policy, which he edited.

He and other speakers stressed the importance of circulating facts about immigration at a time when presidential contenders such as Donald Trump and Sen. Ted Cruz (R–Texas) have made negative comments about immigrants.

“This is going to be a hard year, this election,” said Neil Ruiz, executive director of the Center for Law, Economics, and Finance at George Washington University. But an analysis of the election will reveal what is politically possible for immigration in the coming years.

Alex Nowrasteh, an immigration policy analyst at the Cato Institute, said the American public is now more supportive of immigration. Citing Gallup polls, he said that in 1993, 6 percent of Americans wanted more immigration and 66 percent said they wanted less. Now, 25 percent of Americans want more immigration and 34 percent want less.

“I think that is a huge change in politics,” Nowrasteh said.

‘They Steal Our Jobs.’

Powell said the “most popular” argument against immigration is that “they steal our jobs.” But he said “immigration both creates and destroys jobs”—although there can be a temporary displacement of native-born workers, immigrants also create demands for goods and services, thus creating jobs.

Powell said it isn’t immigrants per se that are the worry, it’s the increase in the labor force and increased job competition. But if that argument held up, there should have been “massive, long-term structural unemployment” as a result of the near tripling of the labor force since 1950 because of the addition of women, baby boomers and immigrants, he said.

If there were a fixed pool of jobs, that might have been the case, Powell said. But “there’s just no net effect on jobs overall.”

Nowrasteh said different economic models have found that immigration has a “very small effect on federal and state budgets” over the long term. That means immigrants’ fiscal impact doesn’t support either an argument for or an argument against greater immigration, he said.

However, Nowrasteh said, studies that examine the impact of a decrease in immigration show a “uniformly more negative” impact than either increasing immigration or keeping levels the same.

Ruiz added that any negative impact of immigration on native-born workers’ wages is temporary, because displacement allows them to take on more specialized, higher-paying jobs, he said.

Ruiz also pointed out that there is a “global welfare gain” from greater immigration because it allows people to move to countries where they will be the most productive. Immigrants are “economic ambassadors contributing to two economies simultaneously”—they provide needed skills in their adopted countries but also send money to their home countries, he said.

He added that immigrants form networks with their home countries, facilitating trade.

More Immigration the Answer

All three speakers agreed that U.S. immigration policy should allow more legal immigration.

Powell went as far as saying that the U.S. should move closer and closer toward open borders until there is solid evidence that immigration is having or will have a negative impact on the country’s institutions.

Ruiz said he would support a system in which visa numbers fluctuate based on economic need, with an independent commission rather than politicians making recommendations as to those numbers.

Nowrasteh recommended revamping guestworker programs so that foreign workers aren’t tied to a particular skill set or employer, as they are now. Rather, foreign workers should have complete freedom of employment for a temporary period, he said. He added that visa caps and quotas should be replaced with tariffs that can be used to help native-born workers who are adversely affected by the increase in immigration.