Economists On Immigration: What's The Matter?

Recently, an "open letter" to the President and Congress on immigration was penned by George Mason University economist Alex Tabarrok of the Marginal Revolution blog. It was signed by over 500 economists even though it consisted of the usual sentimental flapdoodle and duplicitous double-dealing, such as citing data on legal immigrants to argue for amnesty for illegal immigrants.

When it comes to immigration, what's the matter with economists, anyway?

Well, first let's not blame all economists. The vast majority had the self-respect not to sign.

Notably lacking from the list were the biggest names in the field—such as Milton Friedman, Thomas Sowell, Paul Krugman, Paul Samuelson, and Gary Becker  Apparently, they have risen high enough that they can afford to dissent from their colleagues politically-correct happy-face groupthink on immigration.

Also absent list were labor economists who have actually researched the effects of immigration, such as George Borjas and Barry Chiswick.

The consensus among these economists, reflected in the National Research Council's The New Americans back in 1997, is that immigration, especially illegal immigration, does little for economy as a whole. The productivity of illegal aliens is so low that they don't amount to much in the context of a $12 trillion economy. Immigration's main effect has been to redistribute wealth away from low and average income American citizens to the immigrants themselves and to the wealthy Americans who employ them.

Unfortunately, few economists know much about immigration. Those 500 economists would likely average worse on a test of factual knowledge about the subject than the typical VDARE.COM reader.

But they don't care. One apparent side effect of a Ph.D. in economics is the assumption that you can extrapolate from general principles without knowing enough facts to understand which principles apply to this particular situation.

Reading popular blogs by prominent economists—such as Tabarrok's and Tyler Cowen's Marginal Revolution, Greg Mankiw (the Harvard professor and former chairman of George W. Bush's Council of Economic Advisors), Berkeley prof Brad DeLong's blog, and EconLog by George Mason's Bryan Caplan and Arnold Kling—reveals just how ignorant most economists have chosen to remain about the empirical realities of immigration.

They obviously haven't heard the old saying, "Better to remain silent and have people wonder if you are ignorant than open your mouth and remove all doubt."

(I often give Steven D. Levitt, the "Freakonomist", a hard time, but I have to admit he has had the self-respect not to say anything about immigration during the current debate.)

You can't altogether blame economists for their weakness on immigration. Most aren't equipped by their training to think hard about the broad range of issues raised by immigration. Economists like to make simplifying assumptions that leave them intellectually disarmed for analyzing an issue that extends so far beyond their bailiwick.

You've probably heard the story about the physicist, chemist, and economist who are shipwrecked on a desert island. Starving, they find a case of canned pork and beans on the beach. But they have no can opener. So they hold a symposium on how to open the cans. The physicist goes first:

"I've devised a physical solution. We find a pointed rock and propel it at the lid of the can at, say, 25 meters per second—"

The chemist breaks in:

"No, I have a chemical solution: we heat the molecules of the contents to over 100 degrees Centigrade until the pressure builds to—"

The economist, condescension dripping from his voice, interrupts:

"Gentlemen, gentlemen, I have a much more elegant solution. Assume we have a can opener..."

Likewise, economists tend to assume the health of the political, institutional, cultural, and human underpinnings for our advanced economy. Thus they tend to be clueless about the long-term threats posed by immigration.

When the maverick Peruvian economist Hernando de Soto first became prominent, he paid a visit to the leading economists in the United States. They wanted to discuss with him the typical issues that interest contemporary economists—Peru's budget deficits, money supply, tariffs, privatization plans, and the like. De Soto, however, wanted to find out how to set up a country registrar of deeds office. "Everybody in America who truly understood property rights died 100 years ago", he ruefully laughed.

In Peru, in contrast, security of property rights is a casualty of the racial struggle between the descendents of the Conquistadors and the descendents of the Incas.

We're lucky to live in a Republic cautiously built up by our forefathers to " secure the blessings of liberty to ourselves and our posterity"if we can keep it. Prudence suggests that we not play dice with the fundamentals of the American system—and that those crucial elements may extend beyond what is dreamt of in the economists' philosophy.

Likewise, the vast majority of the economics professors have tried to ignore the most important book of the decade on why rich countries are rich and poor countries are poor: Richard Lynn and Tatu Vanhanen's IQ and the Wealth of the Nations. (Fortunately, economists Garett Jones and W. Joel Schneider have given it serious consideration in their paper "Intelligence, Human Capital, and Economic Growth".)

Libertarian economists are particularly reluctant to allow any mention of differences in IQ—because if we all just assume that everybody is equal, well, that sweeps a lot of unpleasant problems under the rug.

Moreover, when it comes to immigration, the views of economists themselves are often driven by the opposite of the rational individualism they assume in their theories. Instead, they form their prejudices based on ideology, emotion, and whim.

The economist-aesthete Cowen, for example, called in Slate.com for the creation of a Hispanic shantytown in New Orleans because so much good pop music has come out of Brazilian and Jamaican shantytowns!

Finally, although many economists advocate an individual-centered moral code that denigrates patriotism and any solidarity with fellow citizens, it's more than ironic that family nostalgia and ethnocentrism are probably the biggest drivers of many economists' pro-immigrationism.

Mankiw, for example, has a hard time thinking about immigration without proudly dragging in his four grandparents who immigrated from the Ukraine. He blogged:

"When I see unskilled Mexican workers coming into the United States to find better jobs, I cannot see any difference between them and four Ukrainian immigrants I know who came into the United States almost a century ago to find better lives. Those four Ukrainians were my grandparents. So to me, taking a hard line on immigration feels a lot like slamming a door in the face of my grandmother."

Similarly, Paul Krugman wrote this spring in his New York Times column:

"'Give me your tired, your poor, your huddled masses yearning to breathe free,' wrote Emma Lazarus, in a poem that still puts a lump in my throat. I'm proud of America's immigrant history, and grateful that the door was open when my grandparents fled Russia. In other words, I'm instinctively, emotionally pro-immigration." [North of the Border, March 27, 2006]

(To Krugman's credit, however, he went on to admit, for the first time, that, "serious, nonpartisan research reveals some uncomfortable facts about the economics of modern immigration, and immigration from Mexico in particular.")

These economists obviously feel that the most important purpose of future American immigration policy is to validate the admission of their own grandparents at Ellis Island a century ago. Apparently, they haven't been educated to understand the strong emotions driving their preferences. Their individualist perspective seems to be too limited to comprehend many human motivations, especially political ones.

Economists have gotten lots of valid mileage out of the concept " Incentives matter" in explaining human behavior.

What they need now is an additional two-word worldview: "Families matter."

Like the economists, I too extrapolate from general principles. But I focus on this simple insight, which is underexploited in today's intellectual marketplace—unlike free market economics, which has plenty of practitioners. Perhaps half of what I write is linked to "Families matter".

Of course, I define "family" broadly,—not just in the sense of nuclear family that Americans think most about, but covering topics ranging from DNA, heredity, acculturation, extended families, nepotism, and up through race and nation.

I don't claim to know how family will always matter—just that many topics will turn out to have a family angle overlooked in our current intellectual environment.

So maybe that's the difference between me and the economists. They use general principles as shortcuts to opinions. I use my two-word worldview as a Geiger counter to help me figure out where to start digging.

My worldview tells me that immigration is a problem. The economists' worldview could tell them the same thing. But many of them refuse to let it.

[Steve Sailer [email him] is founder of the Human Biodiversity Institute and movie critic for The American Conservative. His website www.iSteve.blogspot.com features his daily blog.]