Immigration and Wages
JBS | May 26, 2007
In 2004, economist Todd G. Buchholz — author of the book New Ideas from Dead Economists — published a new book, this time on the loss of jobs in America. Entitled Bringing the Jobs Home, in it Buchholz pointed out that immigration can either be a blessing or a curse to a nation and that it's up to policymakers to structure immigration laws in such a way as to help rather than hurt the nation. Unfortunately, Buchholz observed that current U.S. policy hurts the nation.
What policy options did Buchholz explore? First, he pointed out that a sane immigration policy would attract skilled, highly educated immigrants and limit or prevent the mass immigration of unskilled laborers. According Buchholz, "a college educated immigrant who shows up on our shores delivers a +$198,000 impact on our fiscal picture" because he or she pays taxes but does not consume entitlement dollars disbursed by the state "for their birth, early health care or schooling." Moreover, they create jobs. According Buchholz, "educated immigrants are more entrepreneurial and far more likely to create new jobs that cost old ones."
To support his argument he points to Hungarian immigrant Grf Andrs, the scientist who, better known as Andy Grove, helped build Intel into a world leader in the semiconductor industry. "If not for Andy Grove," Buchholz notes, "there might not be an INTEL INSIDE sticker on your computer, and America's dominance of advanced semiconductors might have flickered and displayed a FATAL ERROR message."
On the other side of the coin, mass immigration of unskilled labor brings high costs to society while also depressing wages. An immigrant "with less than a high school education costs other taxpayers about $13,000," Buchholz points out. Meanwhile, they drive down wages for existing citizens "by about 1 percentage point to 3 percentage points."
Now, a study from the official Canadian statistics agency, Statistics Canada, has provided evidence supporting Buchholz' contentions. According to Canada's National Post, the study "found that a significantly higher proportion of immigrants to Canada than the U.S. are highly educated." As a result, wages for high skilled labor in Canada has declined slightly because of the greater supply of high-skilled workers, but the immigration of such workers to Canada has not hurt the middle class worker at all. In fact, "Low-skilled workers in Canada have also gained relative to high-skilled workers," the report found, reducing income inequality north of the border.
The situation is different in the United States where mass illegal immigration has brought in a flood of low-skilled labor. According to the National Post, in the U.S., "immigrant labour is concentrated among low-skilled workers depressing their wages."
This is not to say that immigration of even high-skilled workers should not be carefully regulated. A free people living in an independent, sovereign nation has the right to determine with whom they wish to associate, and that right extends to defining and regulating acceptable immigration policies. Some, like Alan Greenspan, who recently said we should "open up a significant window for skilled workers" in order to depress wages paid to professionals, go too far.
But a sane immigration policy would not reward millions of unskilled illegal immigrants with access to the benefits of living in America and turn away highly educated immigrants who seek to enter the country through established legal channels in order to start businesses and build better lives. That's the kind of policy — as the country has found out the hard way — that reduces the standard of living for everyone.
Infowars.com is Copyright 2007 Alex Jones | Fair Use Notice
"TerrorStorm is something that should be seen by everyone, no matter what their stance/affiliation/political bent. " - Rich Rosell, Digitally Obsessed UK
Get TerrorStorm on DVD today