June 19, 2006
Immigration: The Greatest Anti-Poverty Program Ever Devised
America is a generous and open country and these qualities make America a beacon to the world. We should not let exaggerated fears dim that beacon.
The 500+ signers of the Independent Institutes Open Letter on Immigration
Washington, D.C.The Independent Institute has just released its Open Letter on Immigration to President Bush and Congress on the economics of immigration.
The list of more than 500 signatories includes 5 Nobel LaureatesThomas C. Schelling (University of Maryland), Robert Lucas (University of Chicago), Daniel McFadden (University of California, Berkeley), Vernon Smith (George Mason University), and James Heckman (University of Chicago).
The Open Letter on Immigration reminds President Bush and all members of Congress of Americas history as an immigrant nation, the overall economic and social benefits of immigration, and the power of immigration to lift the poor out of poverty.
Economists disagree about a lot of things but there is a consensus on many of the important issues surrounding immigration, said Alexander Tabarrok, Research Director at the Independent Institute and the primary author of the letter. The consensus is that most Americans benefit from immigration and that the negative effects on low-skilled workers are somewhere between an 8% wage reduction to no loss in wages at all. Reflecting this consensus the signatories to the Open Letter include prominent economists involved in both Democratic and Republican administrations such as N. Gregory Mankiw (Harvard University), former Chairman of President Bushs Council of Economic Advisers, and J. Bradford DeLong (University of California, Berkeley), Deputy Assistant Secretary of the Treasury under President Bill Clinton, as well as Alfred Kahn (Cornell University), Chairman of the Civil Aeronautics Board under President Jimmy Carter, and Paul McCracken (University of Michigan), Chairman of the Council of Economic Advisors under President Richard Nixon.
The letter also points to many important effects of immigration that may not be widely appreciated: Immigration is the greatest anti-poverty program ever conceived. Not just because the immigrants are much better off but also because they send billions of dollars of their own money back to their home countriesa form of truly effective foreign aid.
As the House and Senate struggle toward compromise on an immigration bill, tensions and rhetoric are rising. The signers of the Open Letter on Immigration believe that this emotional debate taking place in Washington, D.C. and around the country could be elevated by a modest and non-partisan reminder of the value of immigration, and plea for a clear-eyed consideration of the principles at stake and the historic American goals that will be affected in any outcome.
To help create a fair sense of both sides of the argument, the Open Letter on Immigration notes the economic benefits of immigration, but puts them in context. For instance, Overall, immigration has been a net gain for American citizens, though a modest one in proportion to the size of our 13 trillion-dollar economy.
Similarly, the signers also acknowledge that immigration of low-skilled workers may have lowered wages of domestic low-skilled workers, but also note that the resulting wage reductions for high school dropouts is estimated to be from eight percent to as little as zero percent.
In addition, the Open Letter points up connections that sound immigration policy can make between the political values on both sides of the debate, balancing, for instance, compassion for those low-skilled workers seeking jobs with the power of freely competitive markets to create those jobs: Immigrants do not take American jobs. The American economy can create as many jobs as there are workers willing to work so long as labor markets remain free, flexible and open to all workers on an equal basis.
Public fears of lost jobs are unfounded and most workers will not experience any negative impact on their wages. Congress would do well to recognize the benefits of immigration and pass a reform that allows greater numbers of legal workers into America, said signer and Independent Institute Research Fellow Benjamin Powell, Director of the Center on Entrepreneurial Innovation.
By presenting legitimate concerns over immigration in light of a realistic assessment of immigrations economic benefits, the signers of the Independent Institutes Open Letter on Immigration hope to promote more thoughtful debate on one of the most contentious issues of the day.
To read the Open Letter please go to:
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