Foreigners Should Count When Considering Immigration

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A blog about business and economics.
May 8 2013 11:17 AM

The "Sensible" Objections to the Gang of Eight Bill Don't Make Much Sense Either

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The Gang of Eight listen during a news conference on immigration reform on April 18, 2013 on Capitol Hill

Photo by Alex Wong/Getty Images

Yesterday's Heritage Foundation study on the allegedly high fiscal cost of immigration turns out to be not just conceptually flawed but co-authored by a guy who seems to be a bit of a racist ("the prediction that new Hispanic immigrants will have low-IQ children and grandchildren is difficult to argue against"). But Jonathan Chait wants us to know that not all immigration reform opponents are crazy bigots. And I agree.

You throw words like "crazy bigots" around to refer to people who have socially marginal viewpoints. The noncrazy, nonbigoted objections are based on the view that the problem with immigrants from Mexico is that they're so darn foreign rather than excessively dusky in skin tone, and thus that their interests ought to be ignored on the grounds of nationalism rather than racism.

Chait urges us to consider the negative impact on wages that an influx of low-skilled immigrants will have on the wages of similarly situated current residents of the United States and recommends a Yuval Levin article in which he "sensibly proposes that the bill be amended to let in fewer low-skilled legal immigrants and more higher-skilled legal immigrants." The disagreement between Chait and Levin is that Levin thinks such an amendment would make it easier to pass comprehensive reform while Chait thinks it would make it harder.

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I'm all for increasing the level of skilled migration allowed under the bill. You could allow for more high-skilled guest workers. Even better it seems to me would be to allow for more green cards for skilled workers, perhaps eliminating skilled guest workers in the process. But I continue to find the ethical calculus behind Chait/Levin-style thinking on this subject puzzling. After all, actual and potential immigrants are people too! A greatly influx of foreign workers will raise American incomes on the whole. Liberals care not just about the size of the economic pie, but also its distribution. And it's perfectly appropriate to put greater weight on the economic needs of poor people than rich people. But in the low-skilled immigration calculus the poorest people—the immigrants—are the ones who receive the largest benefit. To the extent that you have more immigrants you have both a stronger moral case for redistribution to low-income natives (greater objective needs) and a stronger practical case for redistribution to low-income natives (greater fiscal capacity) but the idea of avoiding a small harm to poor people by inflicting a much-larger harm on substantially poorer people makes very little sense to me. That's especially true when the pie could be further expanded and the distributional effect counteracted by allowing for more skilled migrants—not just computer programmers but doctors and other professionals.

The conservative view of this manages to be even more puzzling, since in all other contexts conservatives strongly favor policy measures that increase the marginal return to capital and vehemently reject consideration of the distributional implications of such measures. Class war is a great evil to be avoided at all cost except in a case where the interests of the American working class can be putatively advanced by punishing the third world poor.

All told, this is why the fiscal impact issue is so important. If immigration policy can be structured to make the welfare state more sustainable, then it's a huge win for everyone. If immigration policy is structured to make the welfare state less sustainable, then there's potentially a problem. The great thing about immigration is that since it uncontroversially increases GDP, it's clearly possible to structure immigration policy in a fiscally beneficial way. The right question to ask about the Gang of Eight bill is: Does this legislation as written do so? The fact that Heritage resorted to such a methodologically weak argument to say that it doesn't make me think that it probably does. But it's clear the Gang of Eight bill could be amended to do more on the fiscal front and I think we really need to see more rigorous analysis of these issues.

Matthew Yglesias is the executive editor of Vox and author of The Rent Is Too Damn High.

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