Lazy, Job Stealing Immigrants?

Sebastian Mallaby examines the myths embedded in the debate over illegal immigration. His column is pasted below, but here's the gist:

Myth 1: Immigrants steal American jobs!

Not really, in fact, companies that would have located outside the United States have a greater incentive to do business here because of the supply of low skilled, low wage labor in the United States. So, immigrants also create jobs for American workers and managers.

Myth 2: Illegal immigrants drain federal, state, and local governments of revenue.

False, recent studies suggest that the effects of undocumented workers on Uncle Sam's pocketbook is about zero.

Myth 3: Even if illegals don't steal jobs from Americans, they drive down the wages of low skilled Americans.

Well...the evidence here is mixed and studies have found that undocumented workers have lowered the wages of low-skilled natives. In his column (pasted below), Sebastian Mallaby suggests that even if undocumented workers cause wage losses for some groups, the costs associated with preventing the inflows of illegals well outweigh the gains that could be achieved from stemming the inflow. I would add a footnote to that: If low skilled workers in the United States are losing jobs to or, in any way, competing for jobs with low skilled workers from Mexico that cannot speak English, policymakers should focus their attention on U.S. educational institutions. The U.S. is the richest country in the world; American workers should not be losing jobs to low skilled workers who, in some cases, cannot speak English.

Sebastian Mallaby in today's Post:

"...People say, contrariwise, that immigrants steal jobs from native-born Americans. But economists have patiently explained for years that there is no finite "lump of labor" in an economy. The presence of migrants causes new jobs to be created: Factories that might have gone abroad spring up in Arizona or Texas. Hasn't anyone noticed that California, where fully one-third of the adult population is foreign born, has an unemployment rate of less than 5 percent?

People say that immigrants burden social services while not paying taxes. Actually, undocumented immigrants are ineligible for welfare, food stamps and Medicaid; and although they do use hospital emergency rooms and schools, they also pay sales taxes and payroll taxes, and one in three pays income tax. The net result is that immigrants cost the average native U.S. household an extra $200 in taxes each year, according to a study of 1996 data. Once you take into account the boost to pretax incomes caused by immigrants' contribution to growth, the total effect of undocumented workers on native-born Americans is roughly zero, according to Gordon Hanson of the University of California at San Diego.

People say that immigrants cause wage losses even if they don't cause job losses. Here the story is subtle: Some studies find no evidence that immigrants pull down wages, while others find that native-born high school dropouts lost as much as 9 percent of their earnings between 1980 and 2000 as a result of immigration. But -- and here comes the sane scream -- there's no way that even a 9 percent wage loss can justify the policies that immigration hawks advocate.

Really, how much could draconian enforcement restore those wages? Between a quarter and two-fifths of undocumented workers originally enter legally, so stringent border enforcement could only affect about two-thirds of new arrivals. Moreover, arrivals are only part of the issue; the alleged downward pressure on wages comes less from the 400,000 illegal immigrants who show up each year than from the 35 million immigrants already here, two-thirds of them legally. And migrants will continue coming even if the entire southern border is walled off. Europe has a wall called the Mediterranean. It still has illegal immigrants.

Thanks to intensive enforcement over the past year, illegal immigration from Mexico is thought to have fallen by a quarter. Suppose even more spending could cut the number of illegal entrants from 400,000 to 200,000 a year, so that 2 million arrivals could be prevented over a 10-year period. Add in an aggressive deportation program that ejected 1 million illegals, and you are still only scratching the surface. Even if immigration has driven down wages for high school dropouts by 9 percent, it's hard to see how truly vicious counter-immigration policies could drive them up by more than about 2 percent.

That simply can't be worth it. Border security does not come cheap: We could save money on unmanned aerial drones and use it to help high-school dropouts with a more generous earned-income tax credit. And although the concern for high-school dropouts is welcome, it must be weighed against the aspirations of migrants. Is it right to push native workers' pay up by 2 percent if that means depriving poor Mexicans of a chance to triple their incomes?

Of course it isn't, and given that the total economic effect of immigration on U.S. households is a wash, the big ramp-up in enforcement spending beloved by immigration hawks is an egregious waste of money. But no politician is going to say that. Candidates with a good record on immigration -- Rudy Giuliani, Hillary Clinton, John McCain -- are trying to avoid the issue. And the demagogues and nativists are allowed to spout unchallenged nonsense."