25.5.07

Amnesty or Economic Stability?

The issue of immigration is not likely to be solved by the new immigration bill currently under consideration in both Houses.. Immigration is ultimately an issue of economics and social science more than anything else. The new law, like previous ones, focuses upon legality, security, and punitive actions. This law—no law—can be used to stop the valve when an imbalance between internal and external pressures has resulted in a vacuum. That is where the United States is.

Wages
In the US—as in most western countries—manpower is expensive while supplies are (relatively) inexpensive. Not surprisingly, in most developing countries, the opposite is true. Knowing this to be true, large companies have outsourced their labor or completely moved overseas in attempts to reduce costs associated with the human element of production. This reduction of midlevel jobs has resulted in an upward thrust in education: where 50 years ago a bachelor’s degree was sufficient in most industries (and 50 years before that, a high school degree was often sufficient); today, employment contends largely on a master’s degree. More people are getting higher educations, in turn hoping for higher salaries. With midlevel outsourcing, this creates a vacuum in low-level labor and services: housekeeping, yard-work, garbage, etc. These are the jobs that are essential but, nevertheless, difficult to fill—jobs that immigrants are rushing to fill because the prospect of $5 an hour in the US outweighs the prospect of $10 a day in Central America. This is the first part of the vacuum

Population
Growth within any nation must continue along standard-multiplication trajectories. Just as sudden bursts in population growth can send a nation into instability, so sudden declines in population trajectories creates a vacuum. In a socialistic system, when the benefits of one individual depends upon the taxation of more than one laborer, demand is met only by increasing GDP, wages, and a stable increase in the employment pool. Whereas many European nations have begun to decline in their population growth among the native peoples, the US employment pool began to decrease along a sudden, steep trajectory with the legalization of abortion. The US has aborted between 500,000 and 1.5 million children every year since 1972 (totaling 15-20 million children)—which further adds to the strain that already existed on the employment pool created by socialized benefits. This is the second destabilizing element that has created the vacuum for low-wage workers in the US.

Margins
Despite the massive growth of Wal-Mart and the like, the US economy depends largely on small to mid-cap businesses for a majority of the GDP. The margins of these businesses are thin as they are—but add in the inability to get someone who will empty trash and clean an office for less than $10 an hour and full medical coverage (benefits for which one used to require some education, but now being guaranteed despite the lack of education) and the environment is ripe within a plurality of businesses nation wide to the hiring of immigrants.

Resource Drain
Some argue that granting legal status to the 12 million currently here (and upwards of 60 million over the next decade) would only result in further drains to the US entitlement system. Consider that the low-education status of some of these immigrants would actually fill the low-wage employment pool that is already shallow in the US; in addition, it isn’t like these 12 million haven’t already been costing the US extensively through public education, through loss of taxes, through use of public facilities (uninsured hospital visits, or uninsured motorist accidents) and through any number of other illegal activities that illegal status breeds.

Amnesty
Many have criticized the new law as being little more than amnesty for lawbreakers. I don’t like it, But consider the other side: if the 12 million illegal immigrants were exported today, it would begin such a downward effect businesses that first wages would skyrocket—creating a strain on employment resources—then the weakest businesses would begin layoffs en masse—resulting in an unemployment bubble that would effectively send the economy into recession. Amnesty, as unattractive as the option appears to most, is the best bet the US government has to increasing tax revenue on already existing labor-pools without broad tax increases. Some have asked what happens to the billions or trillions that immigrants will pay to be able to legally stay in the US? At best, these funds will continue to feed the disproportionate entitlement benefit / employment issue at play. Either of the other options—exporting all illegal immigrants or simply ignoring their presence (and thereby allowing them to earn untaxed wages)—is a recipe for disaster. The only remaining option, in the environment that the country has embraced—of regular abortion, upward-movement education and wages, the socialized entitlement system, and loss of revenue through untaxed wages currently earned by illegal immigrants—is to find ways to repopulate the low-wage employment pool while still continuing to increase the taxable employment pool.

Conclusion
No, ultimately this new law doesn’t solve the long-term problems that we have created in our selfish myopia—but that would actually take some self-reflection and life-style change whereas this law just passes the problem beyond the scope of our lives to that of our children.

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