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05/28/2007

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Nelson

How come no one ever frames the problem of illegal immigration as a undemocratic wealth transfer from the tax base to employers of illegals?How come opponents of illegal immigrants would rather deport them than change the laws to allow someone to come over without waiting 20 years to work and pay taxes legally?

John Norak Aitek

I have been to America many times to do business and it is clear from my observations that, like in Australia, lack of immigration can hurt business.

Businesses today are highly competitive. We have to think of ways to lower costs and increase productivity. We need all the skills and labor we can get our hands on.

The reasons for allowing open borders immigration is purely economic, but the people who tend to dislike immigration tend to hate it for noneconomic reasons.

Immigrants are a great resource that businesses can tap into, and I myself have made most of my wealth tapping into the skills of migrants. Some people think I am exploiting migrants, but I like to think of myself as helping them. Because business is non-coercive and voluntary, there are no losers. I have seen some of my workers working their way from being dirt poor to be able to buy a large house and drive a Lexus. The American Dream is attainable, but some people are born in political environments that restrict them. Nevertheless, the will to work is there, and like a petrochemical firm searching for oil, I search for immigrants because I know they hold a vast pool of human capital waiting to be unleashed for productive purposes.

In an ideal world there would be open borders immigration and minimal if not no welfare.

Dan 3L

"In an ideal world there would be open borders immigration and minimal if not no welfare."

John, you are exactly right--but these two items go together. The problem is we currently have open borders (w/o proper management) but w/ an extensive welfare state.

John Norak Aitek

Dan: "Finally, politics aside, doesn't illegal immigration posses a huge problem for policy planning? A 10% inaccuracy in the number of people using the roads, water, sewage of a city makes a huge difference."

Policy economists can make predictions on labor movement. They do this already for migration within a country. There is bound to be some error as there is a random component to the movement of humans. Just as it may be unpredictable to know how many people will move from Mexico to the US it may be difficult to know how many people will move from New York to Florida. The best way to reduce uncertainty is to put walls up everywhere and restrict people's movements to within their own houses. This certainly won't be good for the economy as trade opportunities won't be realized and will be lost. This is exactly the same argument for immigration from Mexico to the US. The reason why economic gains can be realized by a person who drives from the suburbs to the city everyday is the exactly the same reason why economic gains can be realized from a migrant from Mexico traveling to the US to work. Labor is moving to where it is more productive.

Matt Howard

Mr. Becker,

A quick follow up to your interesting post.

Would placing a cost on illegal immigrants to make their life in the U.S. legitimate have the counter-effect of incentivizing illegal behavior, such as indentured servitude / slavery? I am thinking in terms of corrupt individuals paying off another's "debt" in turn making them indentured (e.g., immigrant children working off debts of illegal family members).

Thanks for your thoughts.
Matt

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