Immigration and Your Father’s Oldsmobile

The whole discussion regarding immigration -- quite apart from issues regarding illegals or “refugees” -- is still fatally based on the same old re-energize model that has about as much relevance to today’s realities as the Dick and Jane books of the 20th century have to the realities of childhood in 21st century America. Yet even conservative analyst Victor Davis Hanson, who is highly critical of current “suicidal” immigration policies, thinks that the “wise” policy of the turn of the last century can be effectively reinstated. Wrong. The Age of Immigration is over.

Mr. Hanson buys into the basic “re-energize” mantra that forms the underpinnings of the immigration narrative.

In the past, newcomers from around the world were eager for a second start in the United States. They nearly all worked hard, reminding American-born citizens that that they can never rest on their laurels.

Immigrants honed American competition and helped to keep the nation productive.

Fine. But that was, as Mr. Hanson says, “in the past.”

But let us examine more closely just what the re-energize narrative presumes and see to what extent those presumptions are operative in today’s world.

Basically, the re-energize narrative is that immigrant vitality, innovation and determination is what has been largely responsible for the industrial might, power and growth of the United States. The narrative asserts that without the social readjustment caused by the new ideas and vitality that immigrants bring to the U.S., the U.S. would have become moribund and set in its ways. It is the challenge of assimilating a new immigrant population with its new ideas and new perspectives that forces the U.S. to constantly reinvent itself.

The narrative is heard from both sides of the isle. On the conservative side here is Grover Norquist, president of Americans for Tax Reform, giving his thumbnail version of the re-energize immigration narrative:

Immigration is what’s made us economically strong, politically strong, militarily strong, culturally cohesive and strong.

But it is former New York mayor Michael Bloomberg who does the old immigration soft-shoe about as well as anyone. Back in (6/15/11) he made a major immigration policy address before the Council of Foreign Relations and hit all the old heartstring notes about America being built by immigrants and then founded his case on the supposedly obvious inference that what worked in the past is the key to the future. The trouble is the present immigration realities are far removed from the immigration realities of the past and even recent past.

Yet for Bloomberg, the immigration narrative is still the only game in town and a model for framing new immigration policies.

We would not have become a global superpower without the contributions of immigrants who built the railroads and canals that     opened up the west, who invented ground-breaking products that revolutionized global commerce, and who pioneered scientific, engineering, and medical advances that made America the most innovative country in the world.

The three key projections that Bloomberg makes as being the way to go to keep America growing and prosperous -- projections that are based on the above re-energize narrative -- are (1) just as in the past, the U.S. needs to bring in immigrants with the “work, work, work” ethic for our basic industries in agriculture and manufacturing; (2) just like in the past the U.S. needs to bring in tech-savvy immigrants with the “innovate, innovate, innovate” brains and dynamic to keep our industries cutting edge; (3) just like in the past the U.S. needs to bring in immigrants to keep our cities vibrant.

Projection 1

As Bloomberg states, most immigrants in the past came here “with almost nothing except one thing: a desire to work -- and work and work and work -- to build a better life for themselves and their families.” And, just as in the past, we need the “work, work, work” ethic that immigrants have to keep our basic industries going.

The trouble with this argument is that it is rooted in 19th century and early 20th century realities. The immigrants who came to America knew they had to work hard to survive. Immigrants today know the U.S. is a fail-safe environment where their kids get a free education. Even undocumented immigrants get:

a). Public school enrollment and free or reduced price lunches (many children are U.S. citizens)
b). Supplemental Nutrition Program for Women, Infants, and Children (WIC)
c). Medicaid (primarily for "non-emergency pregnancy related care and emergency care").
d). Food stamps (for U.S. born children -- undocumented immigrants are ineligible to receive food stamps).

Each year, state governments spend an estimated $11 billion to $22 billion to provide welfare to immigrants. Those programs include Temporary Assistance to Needy Families, Child Care and Development Fund, and even meal programs in public housing.

The highest welfare use rates for immigrants are in New York (30 percent), California (28 percent), Massachusetts (25 percent), and Texas (25 percent).

This is not the root-hog-or-die environment that past immigrants knew they were facing. And certainly the immigrant-based criminal gangs don’t seem to be driven by quite the same “work, work, work” ethic that Bloomberg had in mind.

Projection 2

Americans don’t have the engineering and scientific talent to make it on their own. Just like in the past, we must import the brightest and best.

First of all, corporations are looking for the most cost-effective talent. The talent is here, it’s just cheaper elsewhere. This article from USA Today (2004) gives some of the personal accounts of IT employees reaction to being asked to train their replacements from foreign countries. A 2015 article in PJMedia, "Twenty-Five Years of Helping Foreigners Take American Jobs", deals with the same issues and points out that executives of IT firms insulate themselves from the demands of a competitive market place by forcing their own IT employees to compete with and train IT candidates from countries all over the globe -- countries with wage standards as low as one-tenth those of the U.S.

There’s no reason why corporations, at least big, publicly traded ones, should like hiring in a tight competitive labor market. This is especially true for Big Tech firms, which are typically asset-light and have a high level of operating costs going to labor. Most would expect that the pressure on CEOs to meet analysts’ profit estimates each quarter will trump any free-market ethos they may have every time. Why else would the industry spend billions on lobbying and public relations related to immigration? Big Tech’s message to the American public might as well be, “the free market for thee but not for me.”

This brutal practice has been going on since at least the 90s. Let’s see. We don’t have the talent here but somehow the talent we do have is good enough to train foreign workers who don’t have the talent?

Moreover, the idea that, in the age of the internet and internet conferencing, talent must be physically located in the U.S. in order to work for U.S. corporations is ludicrous.

Although recent data is hard to come by, a 2010 study, “Is President Obama Right about Engineers?” is based on data collected by the Census Bureau from the American Community Survey. Dr. Steven Camarota, its author, found the following: (1) 101,000 U.S. engineers looking for a job can’t find any type of work at all; (2) 244,000 engineers are unemployed and have stopped looking for work and (3) 1.5 million engineers have jobs but don’t work as engineers. He writes:

Relatively low pay and perhaps a strong bias on the part of some employers to hire foreign workers seems to have pushed many American engineers out their profession.

The “talent is not here” is not a born-in-the-USA problem but is a structural problem with complex factors at work. This is a particularly insidious and demoralizing stereotype fobbed off on Americans -- especially those deciding on a college major or just entering the job market. Energy and resources should be used to develop and encourage U.S. born to enter engineering and IT fields rather than feeding the “strong bias” for dutifully grateful foreign workers.

Projection 3

Just as in the past, the key to keeping our cities vibrant is big time immigration. Here is Bloomberg again:

There is no greater force for economic revitalization of depressed neighborhoods than an influx of immigrants. The reason is simple: immigrants are dreamers and risk-takers who are driven to succeed, because they know that in America, hard work and talent are rewarded like nowhere else.

Cities in decline? Just throw in the immigrants. Yes -- that does help the population decline. But is it a cure for financial woes?

As US News reports (2012), a number of cities from Baltimore to Chicago are pushing immigration-friendly policies to revitalize their crumbling economies:

The Global Detroit effort includes programs that help immigrants start small businesses, get driver’s licenses and learn English. As part of the Welcome Dayton Plan adopted last year, the Ohio city sponsors a soccer tournament for immigrant teams. Not to be outdone, Chicago Mayor Rahm Emanuel (D) says he wants his home town to be known as the most “immigrant-friendly city in the country.”

Well, the turnaround hasn’t happened yet. Both Baltimore and Chicago are in financial trouble. But this immigration-energize plan has been going on for a long time in central California. Here is an account by Victor Davis Hanson:

Between the mid-1980s and 2005, the state’s aggregate population increased by 10 million Californians, including immigrants. But that isn’t the good economic news that you might think. For one thing, 7 million of the new Californians were low-income Medicaid recipients. Further, as economist Arthur Laffer recently noted in Investor’s Business Daily, between 1992 and 2008, the number of tax-paying Californians entering California was smaller than the number leaving -- 3.5 million versus 4.4 million, for a net loss of 869,000 tax filers. Those who left were wealthier than those who arrived, with average adjusted gross incomes of $44,700, versus $38,600. Losing those 869,000 filers cost California $44 billion in tax revenue over two decades, Laffer calculated.

Seems like importing all those “work, work, work”, “innovate, innovate, innovate” immigrants is not the magic cure for sclerotic cities. And unless the new immigrants bring in more taxes than they get in benefits, why should it -- benefits that were not available in the “wise” immigration policies of the past.

The Old Saw

Then there is the old saw that immigrants do the necessary work that U.S. citizens won’t do. According to this article (16/1/16) in the Boston Globe we would have to pay more for romaine lettuce and restaurants would have a tough time finding dishwashers, and construction firms would be at a loss for roofers and drywall installers, and then there is the clincher: the lawns of all the 1 percenters would go to seed.

But this article from The Center for Immigration Studies claims “that the often-made argument that immigrants only take jobs Americans don’t want is simply wrong.”

Further, this article from Pew Research points out that real wages (adjusted for inflation) have been “flat or falling” for decades and points out that had the labor markets been tightening employers would “offer higher wages to entice workers their way.” A connection with immigration policies?

Whatever policies are adopted, they should be based on current realities -- and not on the three stooges of the re-energize model. Let me conclude with a quote from the Focus Management Group:

The belief that past success, particularly great success, can set an organization apart from the potential negative impact of changing dynamics is one of the primary causes for business failure. Trapped in the limelight and aura of past glories, businesses tend to progress in a predictable manner, oblivious to the dangers lurking around the corner. IBM continued to fight a tsunami of strategic logic in its insular belief that its dominant mainframe computer technology was the only game in town.

Unlike Sears, Roebuck, IBM shifted its business model just barely in time to reverse its decline. Wither the USA? Sears, Roebuck or IBM?

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