Tuesday, May 16, 2006

It's Called the American Dream

Good stuff on the immigration debate from Tyler Cowen and Dan Rothschild with the premise: "Unskilled immigrants are good for the U.S., and the U.S. is good for them."

Until the late 1990s, when a boom in native-born self-employment occurred, immigrants were more likely than natives to work for themselves. Immigrant small businesses, from the Korean corner market to the Mexican landscaping service, are, well, as American as apple pie. The labor market is not a zero-sum game with a finite number of jobs; immigrants create their own work...

...New arrivals, by producing more goods and services, also keep prices down across the economy. Even [George] Borjas — the favorite economist of immigration restrictionists — admits that the net gain to the U.S. from immigration is about $7 billion annually...

And over the coming decades, the need for immigrant labor will increase, according to demographers. The baby boom generation will need more healthcare and more nursing homes. The forthcoming Medicare fiscal crunch will require more and younger laborers to finance the program.

Some argue that we should employ a more restrictive policy that allows in only immigrants with "needed" skills. But this assumes that the government can read the economic tea leaves. Most bureaucrats in 1980 did not foresee the building or biomedical booms of the 1990s, or the decline of auto manufacturing.

We should not trust government to know what kind of laborers we will need 20 years from now. The ready presence of immigrant workers — including the unskilled — makes all businesses easier to start, and thus spurs American creativity.

Tip to Nick Gillespie for the link. And one more thing for the nativist-restrictionists to ponder:
[P]ost-1965 immigrants, as recorded in U.S. census data, have a good record of assimilation. Second-generation children have, on average, higher education and wages than the children of natives. Of the 39 largest country-of-origin groups, the sons of 33 and the daughters of 32 of those groups have surpassed the educational levels of the children of natives (emphasis mine).
Ooooo. Competition is scary.