“Solving” the Immigration Problem

Mass deportation and elimination of Birthright Citizenship as policy options

I see the resurfacing of proposals to eliminate Birthright Citizenship and the forcible deportation of undocumented to solve the immigration problem. What are the implications of such proposals?

Mass Deportation Now

A 2014 Congressional Research Service report cites Department of Homeland Security estimates of 11.5 million undocumented residents as of January 2011. The American Action Forum, headed by CBO’s former head Doug Holtz-Eakin, has estimated the 20 year cost at between $419.6 to $619.4 billion. One time cost (so excluding the subsequent 20 year’s of expenditures) would range from $103.9 billion to $303.7 billion. This would be the one-time direct fiscal cost, amounting to 0.6% to 1.7% of 2014 GDP (2.6% to 7.7% of the 2014 CY Federal budget). The Center for American Progress’s estimate is $114 billion, not including recurring costs.


Source: AAF (2015).

The AAF report continues to assess the long term (supply side) impact (it’s dynamic!). AAF estimates that in 20 years, GDP will be 5.7% lower than baseline given the 11 million reduction in labor force.

Ending Birthright Citizenship

The most recent quantitative study on this issue I know of is this 2010 analysis written by Jennifer van Hook and Michael Fix for the Migration Policy Institute. The simulations indicate that passage of the Birthright Citizenship Act of 2009, which would have denied citizenship to any child born to parents who were both undocumented, would imply an increase of undocumented population from 10.8 million to 15.5 million by 2050. This is shown as the red line in the Figure 1 below.


Source: Van Hook and Fix (2010).

The simulations assume future behavior is the same as current (e.g., fertility, deaths), and the foreign born population remains constant at 10.8 million. Obviously, this assumes that illegal immigration continues. If the simulation assumes completely effective border control, so no new foreign born undocumented enter the country, then by 2050, the undocumented population would drop to 3.3 million. Hence, ending birthright citizenship is not in itself a “solution”, even with a completely cessation of illegal immigration – unless one is willing to wait a very long time.

Concluding Thoughts

Mass deportation would be costly. Ending birthright citizenship would not eliminate all undocumented even with zero illegal cross border migration (i.e., even with a “really terrific wall”).

85 thoughts on ““Solving” the Immigration Problem

  1. Steven Kopits

    Yeah, yeah.

    Let’s talk debate.

    The Drudge poll shows Trump winning yesterday’s Republican debate. I assume he’ll self-destruct at some point. So it’s interesting to see who’s right behind him:

    Carly Fiorina at 18%
    Cruz and Rubio each at 6%.

    Fiorina won the debate, to my mind. Crisp, very well-prepared, hard-hitting and intelligent. Some Thatcherite tendencies there.

    Rubio was very well prepared and reasonably balanced, I thought. Too bad he’s only twelve years old. Cruz I found disappointing. Kasich really hurt himself this time. We all know about cutting taxes in Ohio, now answer the damned question.

    Christie acquitted himself well, as I thought did Walker. So did Paul. None of them is going anywhere.

    Jeb Bush, a safe pair of Republican hands, reasonable, well-prepared guy, actually knows how to run things. He is getting no traction. Maybe he will in the primaries, but the voters have no affection for him. He didn’t throw Justice Roberts under the bus, and a lot of Republicans would like to see Roberts exactly there. So Jeb’s the Republican Hillary, less the emails. Safe, competent, no enthusiasm.

    The CNN team was notably weak compared to the Fox team. Far too much focus on the Donald in the first 90 min. The debate was too long. Two hours is plenty.

    So, Carly Fiorina. She’s the one to watch.

    1. JBH

      Your assumption about Donald Trump is as dead wrong as Keynesian economics. Disaffection beyond anything since Vietnam will give Trump a landslide victory. Scandal and serious contest for the nomination in the incumbent party will knock the Democratic candidate, whoever that is, completely out of the picture. Re immigration — illegal is illegal!

      1. The Rage

        Sorry, but Biden is the likely Democratic nominee. I only see him running for one term, but Clinton is done. Biden really has no reason to throw his name into the hat quickly though. Stay fresh.

      2. Peter Schaeffer

        Back in the 1950s Eisenhower removed 1-2 million illegals with just 1000 Federal agents in 90 days. The cost was roughly nil. However, even if it cost $600 billion that’s a lot cheaper than Amnesty ($2-6 trillion).

        As for ending Birthright Citizenship increasing the number of illegals… The intent is to quickly deport the illegal mothers and their offspring. in other words, they number of illegals would plunge.

        A smaller labor will result in a smaller overall GDP. However, it will increase the GDP of the American people. Something “Americans” tend to care about.

    2. Rick Stryker


      I agree with your assessment of the debate. On Fiorina, I have been a Carly fan for some time now. But last night, for the first time, we saw her compared to the other candidates. To me, she seems smarter, more knowledgeable, more mature and experienced, and with more gravitas. She’s my number one choice at this point. But I wonder if the voters can accept her lack of political experience?

      Rubio is very impressive as well and looks credible on the national stage. But I must say that Walker has been disappointing. He doesn’t seem ready to me, although it is still early. I agree that Christie and Paul aren’t going anywhere. I continue to believe that Trump can’t get the nomination.

      1. Steven Kopits

        I think JBH reflects the visceral state of the grassroots Republicans. The Rockefeller Republicans, as influential as they may be, are not going to determine the nominee. I would vote for Sanders over Trump. He’s not the guy I want representing me, but many Republicans seem to feel differently just now.

        Walker needs to get a tan. Number 1 priority. If he’s looking for colors, Boehner and Trump can probably provide advice. Walker seemed a bit more human to me last night. He has a pasty aura, though. I don’t know if it’s his demeanor or his color. Demeanor may be harder to change, but color can be rectified.

        In any event, I think Carly is going to run with it now. Iron Lady, US style.

        1. Rick Stryker


          I wouldn’t go so far as voting for Sanders over Trump but I share your dislike of Trump. I would never vote for him either. I’d probably have to sit it out. But I think the risk of facing that dilemma is pretty small. I think Trump can’t get the nomination since too many Republicans feel that way. The support he has now is probably his max. Poll numbers right now don’t mean anything anyway and I don’t think Trump’s or Carson’s numbers are predictive of anything. They reflect name recognition, protests, etc. At this time in 2007, Rudy Giuliani had 30%, Fred Thompson had 22%, McCain was at 18%, and Romney was at 7%. At this point in 2011, Rick Perry was beating Romney.

          I don’t think Walker is out of the race yet. But he does look pasty and a bit callow. When people really look at the race seriously, I think it will come down to Bush, Walker, Rubio, and, I hope, Fiorina.

          Carly on the merits is superior to any of them.

    3. Menzie Chinn Post author

      Steven Kopits: Shouldn’t we be talking instead of substantive implications of proposed policies. You talk about costs and revenues in your business, and here I’m talking about costs. You are free to talk about what benefits would accrue to a purging of the US of the undocumented.

      1. Steven Kopits

        Deporting the undocumented is either pure blather or incredibly stupid. How many political campaigns have had such a theme? It’s like the weather: Everybody complains but no one does anything about it.

        I have elucidated my views on this here before, more than once. I believe it should be no harder to get a work permit than to order basic cable, and we should let the price of a permit mediate supply and demand (a ‘dirty float’ in an otherwise liberalized immigration market). But as you know, I am against social support for such persons. Support yourself and obey the laws. That’s my standard, and many illegal immigrants meet these standards. The Mexicans here in Princeton work incredibly hard and are achieving the American Dream. They keep their noses clean and are establishing the standard of excellence in the services industry, just as the Chinese and Indians are setting the academic standards. You want me to demonize them? Well, look elsewhere.

        On this matter, I make Rand Paul look like some deep social conservative. I am pure pay to play.

        But as you also know, I would use this program as a lever to unwind the welfare state. Republicans fail to understand that a liberalized immigration system can be used to undermine social programs. If they did, they might take a different view of immigration.

        Finally, I do not ascribe to JBH’s visceral dislike of immigrants. Princeton is incredibly diverse in ethnic and religious terms. On the other hand, it is highly homogenous in its belief in education, hard work, living in harmony with one’s neighbors and being a constructive member of the community. People don’t have to be like me, but they do have to support themselves and obey the laws.

        1. Peter Schaeffer

          “But as you know, I am against social support for such persons. Support yourself and obey the laws.”

          They welfare state isn’t going away. It’s dramatically expanding. The immigrants coming to the U.S. are generally the most enthusiastic advocates (of a larger welfare state).

          Friedman once said

          “Because it is one thing to have free immigration to jobs. It is another thing to have free immigration to welfare. And you cannot have both. ”

          Since the welfare state is relentlessly expanding, it’s obvious that we have to close the borders.

    4. Johnny

      The average voter in the US does not think in a methodical and analytical way like you Steven.
      Fiorina was the best in the debate, by far. But only in your (and my) assessment.

      For the average Joe ? Trump has the best cards, he is the one to watch.

      1. baffling

        trump’s problem will be his inability to accumulate the voters who supported candidates who drop out. he is building enemies. if bush, walker or fiorina drop out, who will their supporters gravitate towards? i do not think it will be trump-he alienated those folks. and currently he does not have enough support on his own if the field shrinks.

        1. Rick Stryker


          Yes, I agree with this. Trump has high negatives among Republicans and is probably close to his maximum support right now. The anyone-but-Trump vote will eventually coalesce around someone else once people start dropping out.

    5. Peter Schaeffer

      “Jeb Bush, a safe pair of Republican hands, reasonable, well-prepared guy,”

      I guess the last “Bush” administration was a great success because the policy differences between Jeb and his brother are nil.

      Who knew?

  2. Bruce Hall

    Hmmm. I wonder what the reaction and analysis would look like if 12 million of the highest income earners in the U.S. decided to not pay their taxes and certain cities offered “sanctuary”. Would mass lawlessness be deemed “too big to address”? Of course not. The government would use every means at its disposal to “bring them to justice.” The use of economic excuses to avoid legal or social issues is not appropriate. What was the cost of WWII? Well, based on that, everyone should have stayed home.

    If the laws are the problem, address the laws. If the lawlessness is the problem, address the lawlessness.

    1. JBH

      Over many years stretching into decades, like rats gnawing on the leg of a prisoner chained to a wall, the Supreme Court has legislated from the bench. In the process shredding the original intent of the Constitution, which is the precise source of the condoned lawlessness that has swept over the land. Roberts’s decision on the constitutionality of Obamacare was an historic turning point. One man. Redefined penalty to mean tax! Risible to the max. Middle finger right in the face of the majority. You think people are ignorant? Can it be this is still America??? No surprise, then, that the long-suffering majority has had it up to their necks. And are now on their feet, not just saying but full force shouting: “Enough!” Clearly foreshadowing the outcome of the election to come …

  3. PeakTrader

    We should secure the border, ban all immigration for a while, and Americanize the immigrants here, e.g making English the official language.

    Of course, there’s much more wealth and income inequality from the tens of millions of dirt poor immigrants, their children, and their relatives.

    The domestic population, which benefited from American policies and values, shouldn’t compensate immigrants for the poor policies of their countries, that caused them to move here, and those poor policies shouldn’t be imposed on us. They should have the opportunity to achieve the American Dream.

    We should actually help the domestic population of many generations, e.g. the black community, which didn’t share in the American Dream, because of slavery, racism, and the War on Poverty, which caused them to lag on wealth and income, and then devastated the values of the black community.

    1. Robert Hurley

      Am I the only one who actually talks with undocumented immigrants on a weekly basis. They want to learn English and their children do speak English. I see them as contributing to society both economically and culturally. Deportation is an knee jerk reaction arising from thinking only about the cost of immigrants and not the benefit! What a compliment to our society that they want to come here. We need a more rational immigration policy, not one that demonizes every undocumented immigrant. Let’s have a rational discussion about what that policy should be.

      1. Peter Schaeffer

        They are illegal, not “undocumented”. In a welfare state (like the USA) they (and their children) are a vast burden because they can never pay enough taxes to cover the costs they impose. Worse, their children do not even approach equality with the rest of America. We don’t need to import another underclass even if they want to come here.

        1. baffling

          i became best friends with a fellow graduate student whose parents came here right before he was born-illegally in your eyes. he was the first of three children. he and his sister are both phd’s working in universities. he married another “anchor baby” who now has a masters degree. they have three beautiful children and live the american dream. his parents recently retired-his father was a roofer for decades. i must say, you really have an odd understanding of “burden”.

          1. Peter Schaeffer


            A single anecdote is now data? Let me offer an similarly anecdotal reply.

            “The man accused of firing the deadly shot — 45-year-old Juan Francisco Lopez-Sanchez — is an undocumented immigrant, a repeat felon who has been deported five times to Mexico, according to immigration officials.

            It would have been six, a federal law enforcement source told CNN, except authorities in San Francisco wanted him on a drug-related warrant.

            So U.S. Immigration and Customs Enforcement, which had Lopez-Sanchez in its custody in March after his release from federal prison, turned him over to San Francisco deputies. ICE said they requested an immigration detainer, asking that the agency be notified before Lopez-Sanchez was released.

            But San Francisco is a city that doesn’t honor such requests and the sheriff’s department released him. Freya Horne, chief legal counsel to the San Francisco County Sheriff, told CNN that he was let go because there was no legal cause to detain the suspect. ”

            Guess what? All illegals aren’t PhD students or bloodthirsty killers. What are they on average? A burden.

            Both theory and empirical data make this all too clear. This should be obvious to anyone with even one ear or eye open. Everyone agrees that America’s own poor people are a burden. Why would anyone expect that imported poor people would be any better? Let me quote from George Borjas (America’s leading immigration economist).

            “There’s also been a lot of fake fog thrown into the the question of whether immigrants pay their way in the welfare state. It’s time for some sanity in this matter as well. The welfare state is specifically designed to transfer resources from higher-income to lower-income persons. Immigrants fall disproportionately into the bottom part of the income distribution. It is downright ridiculous to claim that low-skill immigrants somehow end up being net contributors into the public treasury.”

            The literature is full of references to the negative tax impact of low-skilled immigrants. In the pre-welfare state era, this wasn’t true. The poor got little or nothing from government (even education was very cheap), and they worked long hours for low wages. The were clearly complementary to higher income groups. That era is over. Health care and education are extremely expensive and the poor are major consumers, to say the least. It would be essentially impossible for a poor person today (other than a single working age male / female with no children) not to be a burden on society. A few specific data points.

            1. “Guest Contribution: The ageing, crisis-prone, welfare state is bad news for welfare migration”

            “Edmonston and Smith (1997) look comprehensibly at all layers of government (federal, state, and local), all programs (benefits), and all types of taxes. For each cohort, defined by age of arrival to the U.S., the benefits (cash or in kind) received by migrants over their own lifetimes and the lifetimes of their first-generation descendents were projected. These benefits include Medicare, Medicaid, Supplementary Security Income (SSI), Aid for Families with Dependent Children (AFDC), food stamps, Old Age, Survivors, and Disability Insurance (OASDI), etc. Similarly, taxes paid directly by migrants and the incidence on migrants of other taxes (such as corporate taxes) were also projected for the lifetimes of the migrants and their first-generation descendents. Accordingly, the net fiscal burden was projected and discounted to the present. In this way, the net fiscal burden for each age cohort of migrants was calculated in present value terms. Within each age cohort, these calculations were disaggregated according to three educational levels: Less than high school education, high school education, and more than high school education. Indeed the findings suggest that migrants with less than high school education are typically a net fiscal burden that can reach as high as approximately US$100,000 in present value, when the migrants’ age on arrival is between 20-30 years.”

            2. “Los Angeles and Welfare”

            “I am sure that I’m not the only one who’s noticed how almost all of the discussion over California’s budget problems managed to avoid using such words as “immigrant” or “illegal”. So I decided to do a few calculations using the 2008 Current Population Survey to follow up on Instapundit’s remark. Well, here are some interesting results for your perusal–no remarks are needed:

            All statistics give the fraction of households in the LA metro area that receive some type of assistance–either cash, food stamps, or Medicaid:

            All households: 20.9% Native households: 12.7% Immigrant households: 33.2% Immigrant households with a citizen head: 26.4% Immigrant households with a non-citizen head: 40.1%

            Just to put things in context, 40% of households in the LA metro area are immigrant households.”

            3. “Impact of Mexican Immigration on Public Coffers”

            “The most comprehensive research on this subject was done by the National Research Council (NRC), which is part of the National Academy of Sciences. The study, conducted in 1997, found that more-educated immigrants tend to have higher earnings, lower rates of public service use, and as a result pay more in taxes than they use in services. In contrast, the NRC found that because of their lower incomes and resulting lower tax payments coupled with their heavy use of public services, less-educated immigrants use significantly more in services than they pay in taxes. The NRC estimates indicated that the average immigrant without a high school education imposes a net fiscal burden on public coffers of $89,000 during the course of his or her lifetime. The average immigrant with only a high school education creates a lifetime fiscal burden of $31,000. In contrast, the average immigrant with more than a high school education was found to have a positive fiscal impact of $105,000 in his or her lifetime. The NAS further estimated that the total combined fiscal impact of the average immigrant (all educational categories included) was a negative $3,000. Thus, when all immigrants are examined they are found to have a modest negative impact on public coffers. These figures are only for the original immigrant, they do not include public services used or taxes paid by their U.S.-born descendants.”

            That last sentence is important. Low-skilled immigrants produce low skilled children who will cost even more.

            4. “The Fiscal Cost of Low-Skill Immigrants to State and Local Taxpayers”

            “In 2004, there were 4.54 million low-skill immigrant households. The average net fiscal deficit per household for federal, state and local spending combined was $19,588. This means that the total annual fiscal deficit (total benefits received minus total taxes paid) for all 4.54 million low-skill immigrant households together equaled $89.1 billion.”

            “In FY 2004, the average low skill immigrant household received $30,160 in direct benefits, means-tested benefits, education, and population-based services from all levels of government. By contrast, low-skill immigrant households paid only $10,573 in taxes in FY 2004. A household’s net fiscal deficit equals the cost of benefits and services received minus taxes paid. The average low-skill household had a fiscal deficit of $19,588 (expenditures of $30,160 minus $10,573 in taxes).”

            5. “The High Cost of Cheap Labor: Illegal Immigration and the Federal Budget”

            “This study is one of the first to estimate the total impact of illegal immigration on the federal budget. Most previous studies have focused on the state and local level and have examined only costs or tax payments, but not both. Based on Census Bureau data, this study finds that, when all taxes paid (direct and indirect) and all costs are considered, illegal households created a net fiscal deficit at the federal level of more than $10 billion in 2002. We also estimate that, if there was an amnesty for illegal aliens, the net fiscal deficit would grow to nearly $29 billion.

            Households headed by illegal aliens imposed more than $26.3 billion in costs on the federal government in 2002 and paid only $16 billion in taxes, creating a net fiscal deficit of almost $10.4 billion, or $2,700 per illegal household.”

            Note that this is just the Federal impact. Illegals and other low-skill immigrants have a greater impact on state and local governments (education, health care, crime, etc.).

          2. baffling

            “Everyone agrees that America’s own poor people are a burden. ”

            you must be a hoot to have thanksgiving dinner with! enjoy your soup with that silver spoon.

  4. Anonymous

    “The Drudge poll shows Trump winning yesterday’s Republican debate.”

    Yeah and almost every online poll showed Ron Paul winning all debates in previous years.

    Menzie you forgot to address the savings we’d have from not having XX million low income / no income individuals in the country.

  5. Steven Kopits

    Kids, the JOLTS data tells us we’ve just run out of labor. You think we can run this country on 3% GDP growth on productivity gains alone? Menzie will rapidly disabuse you of that idea.

    This country was built on immigrants, optimism and aspirations for the American Dream. This is a big country with plenty of room. I still believe in the future, and I welcome those who want to come here and build it with us. Obey the laws, and support yourself and your family. Anyone who can meet those criteria is welcome, as far as I am concerned.

    1. Bruce Hall


      I didn’t see the word “illegal” in your comment, so I agree with your premise. Such a small adjective; such a big concept.

    2. Vivian Darkbloom


      You wrote in an earlier comment: “Support yourself and obey the laws. That’s my standard, and many illegal immigrants meet these standards.” I trust you acknowledge an inconsistency here—the first law “immigrants” are faced with is the immigration law and I’m sure they are fully aware of that. “Illegal immigrants” already flunk your test—all of them. Is this an exception to the rule?

      1. Steven Kopits

        You’re picking nits, Viv, but yes, OK, technically you are correct.

        By obey the laws, I meant more morals than administrative propriety. I don’t think the very fact of being here makes you a criminal. You steal something, then you’re a criminal. I didn’t mean failing to pay a parking ticket.

        1. Bruce Hall

          Steven: “By obey the laws, I meant more morals than administrative propriety.”

          Does that apply to all laws or just entry to the U.S.? How would that work for you trying to enter Mexico? Or any other country?

          1. Vivian Darkbloom


            No, I’ve not worked in Eastern Europe (except for short business trips); but I have lived and worked in Europe my entire professional life (nearly 40 years) and in the later years quite often with Eastern Europeans. Does that disqualify me from expressing an opinion on the point you are trying to make?

            I agree that our laws generally should align with morality and, in Democratic countries such as the United States, they generally do. It appears to me that you are arguing that rather than follow the laws as enacted in a democratic process, the very purpose of which is to ensure that laws do align with “average” notions of morality, you would prefer to ignore those processes and institutions and substitute them for your, Steve Kopit’s, judgement of what the “average” morality is (or, perhaps more likely, should be). One of my reasons for responding to your original comment was that I strongly believe that respect for democratic institutions is no trivial matter to be set aside for one’s individual notions of what the will of the general populace is or what they thin, much less what their notions of “morality” are or may not be.

            And, nobody here is “vilifying” illegal immigrants for their hard work, Steve. I think that’s a very unfair assumption with some pretty loaded language. I’m asking that people respect our democratic institutions and obey laws as they are written and not as they would like them to be. Does that constitute “vilification”? Is it unfair or immoral? I wouldn’t want to be any of those things, so please, if I’ve wandered off the path, set me straight again.

          2. Steven Kopits

            You want me to walk you through the process of doing that? I can tell you exactly how it’s done, at least in the developing world.

            Here’s the trick: Do they check you passport on the way out? If not, you’re good to go. They will have no official record of you every leaving, so they don’t know how long you stayed when you come back. Alternatively, if they have a maximum stay per visit, you just leave the country before the tourist visa expires, and then come back in on the tourist visa.

            You need to keep in mind that many countries distinguish between ‘desirables’ and ‘undesirables’, in practice. If you’re an American or Brit, pretty much everywhere, you’re a desirable. The authorities will presume that you are either creating value or spending money, and further that you are not taxing public services very much. And this presumption is almost certainly true. So your being there is not a problem. They are often not keen to enforce the law against you.

            On the other hand, if you come from some low rent place, say, Pakistan or Moldova, they’ll be all over you.

            So it depends. But there are any number of ways to work in a jurisdiction without officially being there.

        2. Vivian Darkbloom

          I don’t think our immigration law is a “nit”, Steve. As a democratic society (more or less), the US has decided not to have an open immigration policy. We’ve also decided in our social compact to have tax laws, voting laws and all other sorts of “administrative proprieties” as you conveniently characterise that sort of thing. Your language suggests *you* are trivializing the issue—not me. This is not just a technicality. The social compact is a very profound thing not to be diminished by that kind of language. Our mistake was in not enforcing these laws in the first place (because many, like you, apparently, believe they are a mere technicality) and now we have the very practical and humanitarian issue of what to do with the illegal immigrants and their offspring. If you are suggesting that we should sacrifice principle for practicality, then you should be straightforward about that distinction.

          Unlike many of my libertarian friends, I believe that the mark of a well-governed country is that laws are enforced and, in the realm of immigration, that many people *want* to get in, not that anybody can, much less anybody who wants to break the law can. It gives the country the ability to choose law-abiding immigrants over those who view laws our society enacts as “administrative proprieties” or, worse yet, “nits”. I do believe, however, that the immigration problem is on the way to solving itself: the United States is slowly becoming a country where fewer law-abiding immigrants want to come, and this is partly due to the fact that we don’t enforce our existing immigration laws. Many economists will argue that we need them to pay the bills, but that sounds like Ponzi to me. Argentina has a more or less “open” immigration system; but, how many *want* to get in and how many Mexicans and other South Americans are legally flooding across their border? And, the official language of the country is Spanish! Likewise, how many Syrians are opting to settle in Turkey, despite the closer geographic and cultural ties to Syria? As far as the relative success and attractiveness of individual countries is concerned, due to mass illegal immigration, “average” is not over; it is just beginning. The issue is whether that’s a good thing.

          1. Steven Kopits

            You’ve never worked in Eastern Europe, have you?

            To me, a sign of a well-governed country is that legality is aligned with morality. What is illegal should also be what the average person thinks is immoral. (We have wandered well off that track in the US in recent times.) The problem with illegal immigration is that many people, including myself, do not consider it to be immoral. The willingness to take risks–including death and incarceration–for a better life for you and your family, well, to me that’s commendable. Indeed, we have a word for it in English: entrepreneurial.

            Like Robert Hurley above, I also talk to people I presume to be illegals, and mostly I see them working hard. They are helping me, my family and my community, and I’ll be damned if I vilify them for trying.

            But you’re absolutely right, we need a better system, and that’s what I outline below.

          2. Steven Kopits

            As for the quality of Argentine and Mexican governance: I am all for slapping an FAA on them. Absolutely. That would address most of the governance issues you raise.

            We have a lot more economic technology than we are using.

          3. baffling

            vivian, the entire immigration issue exists because we do have a broken system. you present an entirely valid argument. but it is ivory tower. you need to deal with the reality, which is a border which cannot be closed. these wall proposals are simply not feasible. so a solution needs to be presented which deals with this reality.

            an example of this is the prohibition era. we had laws. they could not be enforced. what it means is the laws, even though written and passed, were simply not a solution to any real problem. they failed because of this. when you replied to steven “If you are suggesting that we should sacrifice principle for practicality…” you were standing in that ivory tower. it is not practicality, it is reality. we have many politicians who have elegant solutions they want to impose. the issue is those elegant solutions are not for the real problems which exist!

        3. Steven Kopits

          Viv –

          Do you really drive 55 mph in 55 mph zones? If this were true, then at least 85% of New Jersey must be scofflaws, at least to judge by NJ Turnpike traffic. There are laws, and there is practice. In all societies, these will differ, and in badly governed societies, they can differ a lot.

          The government of Venezuela is democratically elected. Do you think people should follow Maduro’s economic policies, or do you think the government is a fool to try to implement price controls? If you’re an economist, you know that rationing–and that’s what our immigration policy is–will almost inevitably fail. It will lead to black markets and off-the-books transactions, among others. Bad policy begets bad behavior.

          In any event, I do not consider my opinion definitive. If everyone else considered immigration laws sacrosanct, then they would be enforced accordingly. But it doesn’t take some huge moral stretch to look at the Mexicans riding their bicycles to work to say these are not bad people. They may not be legal, but they are certainly not criminals. What’s more, we have a dirty secret: We need them. They run all our services here in Princeton, and they do a great job.

          So, I am not for illegal immigration. I am for reforming immigration laws as outlined below. But where there is a stupid law, you will have stupid responses. If you live in democratically elected Greece, Italy or Hungary, you know all about that. And that’s where we are in the US on immigration.

          The balance of public opinion matters, and even in democracies, that is sometimes not aligned with the law as written.

          1. Vivian Darkbloom

            Sorry, Steve, I’m not buy’in. If I were to drive in the US and get a ticket for driving over 55, I wouldn’t complain because I wouldn’t have any grounds to. (You didn’t say what the correct moral speed limit is according to Steve Kopits, so I can’t be more specific and that’s part of the problem with your system of moral and legal relativity). If I didn’t agree with the law as it stands, I might work to change it, but till then, 55’s the legal limit. That’s why we elect people to pass the laws and throw them out if we don’t like them.

            Apropos that, assuming Maduro is democratically elected, I’d have to bite the bullet and abide by his government’s bad decisions. The standard is not what *everyone else* may or may not think according to polls, pundits or pulse reading—the proper standard measure of that thinking in a functioning democracy is reflected in legislation, whether you or I like it or not in any particular case. I believe that the solution for existing illegal immigrants is a difficult one; but, I also think, contrary to your read on “what everyone thinks” on the immigration subject, there appears to be a very significant divide in US public opinion. Even more reason to enforce existing law until a change of opinion is reflected in new legislation.

            Do I now need to pull out my Thoreau, too?

    3. Peter Schaeffer

      “Kids, the JOLTS data tells us we’ve just run out of labor”

      And wages are soaring, labor force participation is rising, and disability is shrinking.

      None of that this true. Back to the real world.

      “This country was built on immigrants, optimism and aspirations for the American Dream.”

      America’s greatest prosperity (1920 – 1970) as behind closed borders. Not a coincidence.

      “Obey the laws, and support yourself and your family”

      Call us back after the welfare state has been abolished.

      By then the Sun will have turned into a Red Giant.

      1. Steven Kopits

        Let me concede a point to Viv. It appears that even illegal immigrants are able to obtain Federal benefits to which they are not legally entitled. If that’s true, first step is to arrest those bureaucrats facilitating such cheating, and then arrest some of the cheaters. I am against financial support as I said before, and in this respect I think it critical to obey the law. Without compliance on this front, a price-based visa program could prove counter-productive–to Viv’s point.

        I am personally optimistic about the future, Peter, and I do think we will be short on labor. I have argued elsewhere for tightening of disability, student loans, and welfare. I have also argued for some vesting to social security to keep older workers in the workforce. But if you’re really keen on reforming the welfare state, this is the policy for you: http://www.prienga.com/blog/2015/3/19/a-bonus-plan-for-politicians

        I’d also add that you argue that America’s greatest prosperity was from 1920-1970. Well, leaving aside the Great Depression and World War II, sure, it was all gravy. That’s the sort of argumentation which will lead Menzie to take a shot at you. A nice, clean shot.

        1. Peter Schaeffer


          ”I am personally optimistic about the future, Peter, and I do think we will be short on labor.”

          Adjusted for inflation, wage levels in the U.S. are back to the 1950s. Male LFP has been plunging for decades. Disability and food stamps are soaring. The minimum wage is below where it was 50 years ago.

          But a labor shortage is imminent…

          From 1920 to 1970 real wages rose dramatically and tracked productivity. Family and household real median income rose dramatically. Inequality declined quite substantially.

          All with highly restrictive immigration laws.

          Since 1970 the floodgates have been opened. Wages have fallen. Household and family incomes have declined (adjusting for the number of workers per family). Inequality has soared.

          Not a pretty picture.

  6. pete

    The politics of this issue are insane. Republicans trying to latch on to a populism factor like immigration to get the union vote, even though the economics are straightforward in the other direction. Democrats defending immigration when it obviously keeps wages down just to get the latin vote. If we are going to keep the 11.5M and more, which we obviously are, then we ought to at least allow in more high income earners like in the medical field or high tech (or econ professors?) to employ them.

  7. The Rage

    Lets don’t forget, even though you are “illegal”, it is only a light crime, like trespass. The problem is, deporting all the illegals will costs 100’s of billions of dollars. This is the main reason more aren’t deported. I am more into legal immigration because it hits my social status, selfishly. Illegal Immigration is just not that important to enough people. They complain about visas more often. Maybe Blacks should whine more, because the illegals take their jobs far more often than whites.

    Capitalism can’t run both as high living standards and supporting all its production domestically. This was the key behind the “great inflation” when the cold war delayed offshoring while US living standards boomed. By the late 60’s, capitalists saw little reason to continue to grow and began tapping on the brakes via inflation. So the cold war ends and the US opens it doors to more immigrants.

  8. W.C. Varones

    If we’re looking to import a bunch of poor people, it would be more useful to look at GDP per capita rather than total GDP.

  9. 2slugbaits

    Instead of building walls to keep people out, we should be building roads and bridges to bring people in. Absent a serious, violent criminal record or a highly contagious disease, we ought to be opening the floodgate on our borders. I agree with Steven Kopits, we should make the path to citizenship easier than paying your cable bill. Almost every study I’ve seen has concluded that per capita GDP increases no later than the third generation. Many of the usual suspects are showing their true colors once again. They don’t give a fig about future growth or what happens to future generations. All they care about is fighting against anything that might raise their taxes by a few bucks despite the clear long run benefits to the economy of expanding immigration. And that’s the charitable view. A less charitable view is that many of the usual suspects aren’t really concerned about the economic issues…only the whiteness of America.

    1. Bruce Hall


      Racism… again… the talking point? Nothing to do with anything else? That’s getting tiresome. No matter what the issue, when all else fails, play the race card.

    2. Steven Kopits

      Let me distinguish between citizenship and status. The former involves the right to influence property rights in the US, including tax rates and income redistribution through social programs. By contrast, the notion of status confers only the right to conduct business within existing property rights, that is, is does not provide the right to vote, to reside in the country permanently, or to enjoy and suffer the rights and obligations of citizenship. But you can come here to work anytime. I am arguing for status, absolutely not for citizenship.

      To resolve the illegal immigrant issue, we do not need to provide citizenship, only status.

      Most economists prefer to regulate markets through prices, rather than by rationing volumes. Volume-based approaches are almost always crude and cause material distortions in the economy. Labor, including immigrant labor, is a commodity.

      Currently, we using a volume-based approach, that is, we seek to limit the supply of immigrant labor by physical constraints on the free movement of people, that is, through The Wall. This, of course, leads to a black market involving border jumping, human smuggling, over-staying tourist visas, working off the books, and hiding from the authorities domestically. Trump is right: We do have an illegal immigrant problem, but this is problem resulting from bad legislation, not due to the inherent evil of Mexicans or US employers.

      If we switch to a price-based work permit system, then these problems largely disappear overnight. If one can obtain a work permit for a fixed period on short notice for a known price, then there is no need to cross the desert or over-stay a visa. It comes down to an economic decision: Is the cost of the work permit worth the investment? If it is, you can go to Ticketmaster, Stubhub or the Apple iTunes on Thursday, download a permit, and be working in North Dakota by Monday. No need to pay coyotes, no need to cross the desert, no need to hide out.

      Now, a price-based mechanism would also allow people to leave. One of the major downsides of border controls is that once you’re in the country illegally, it’s hard to leave. Therefore, surplus labor will persist during down cycles, due to the cost, time and risk of subsequent re-entry. This in turn creates social problems, including unemployed, sexually frustrated and potentially unruly Mexican men hanging around. In a price based system, coming and going is easy, and if there’s no work, then you don’t buy a work permit, and instead go home and wait for better times.

      In this world this is no Wall, because it’s unnecessary. Employers comply with permits because they are geared–with price leading quantity–to be affordable, convenient and legal. If it’s easy and affordable to hire legal labor, there’s less incentive to hire illegal labor. Show the employer your Apple iPass, and you’re ready to go.

      It converts ‘illegal’ immigration from a cost center involving elaborate border controls, to a profit center, whereby each permit is worth, say, $1500 up front each year. From the 11 million illegals in the country now, it would represent immediate and recurring revenue on the order of $20 bn, collectible in just a few months. By this method, we convert those illegal ‘criminals’ into ‘customers’. That easy.

      And if you took Econ 001, then you probably already know that.

      1. Robert Hurley

        Steven: thanks for injecting a dose of reality and practicality into the discussion. Your proposal is well worth discussing

      2. PeakTrader

        So, you want unlimited foreigners to work and live in the U.S..

        Where do Americans go for work?

        When they buy a ticket to the U.S., why do you believe they’ll go back when it expires?

        Are they going back now without citizenship or status?

        1. Steven Kopits

          Peak –

          You regulate the volumes through the prices. There is some product and market design involved. (Where’s Scott Sumner when we need to create a market!) But the price will always tell you the market balance (ie, whether you are short or long on labor).

          Going back to the home country is like a convertible currency. If you can convert out of a currency, you will convert into it.

          I personally believe many people will stay. If they support themselves–and remember, this is a pay to play system–and obey the laws, they are welcome to stay. However, the proposed system is much more flexible in a downturn. Keep in mind that illegals can’t leave easily now, not even if they want to, due to the risks associated with re-entry. So the current system risks locking in excess labor when, in fact, it would be better redeployed in the home country. The proposed system, as there is an up-front fee involved, means it’s expensive to be in the US if you’re not working. And that should encourage people to go home if they don’t have the prospect of work. Many will, if they know they can come back later if they want.

          I think those illegals who have been here many years will probably stay. But they would stay whether they are legal or not. I prefer they are legal. I have no particular problem with some path to citizenship for those who want it. This exists now as well.

          Where do Americans work? This is the lump sum of labor fallacy. There is no fixed quantity of labor. And right now, it looks to me like we’re going to be short labor for the next several years. If you want to grow this economy at 3%+, you’d better find some immigrants to come do some work.

          Again, there’s nothing wrong to my mind with being an immigrant in the US. There are lots of them–I am one of them. The thing that matters is that immigrants support themselves and obey the law.

          1. PeakTrader

            Steven Kopits, without border security, why would a high price for work permits stop them?

            Without illegal immigration, the domestic population would do the work for higher wages, raising the labor force participation rate.

            Are you suggesting if we offer money to illegal immigrants, some will leave the country?

      3. 2slugbaits

        Steven Kopits Let me give you a couple of history lessons. First, your proposal to have two classes, full citizens with voting rights and residents with economic and property rights but without voting rights has been tried before…and it failed. The Early Republic period of ancient Rome distinguished between two types of citizens. One class of citizens had full property rights and voting rights. Another class had property rights and all of the burdens of being a full citizen, but could not vote. These almost citizens lived in what the Romans called municipia, which is where we get our word “municipality.” What the Early Republic had was very close to the kind of transactional citizenship or legal residency that you are suggesting. It failed miserably and was abandoned by the Middle Republic period. Second lesson: up until the racist and nativist Know Nothing movement citizenship was not a requirement for voting. Citizens of other countries were allowed to vote if they owned property here. So when I hear conservatives talk about going back to the original Constitution (I’m talking about you, JBH), I’m wondering if they realize the actual history. For example, see one of the classics in 19th century American history, “What Hath God Wrought” by Daniel Walker Howe. In that America citizens could not vote while non-citizens could vote.

        I have taken Econ 001. And Econ 101. And Econ 201…etc. I’ve also taken History 001, and History 101 and History 201. As a matter of economics we should be encouraging more immigration. Poster W. C. Varone’s comment about how we should look at per capita GDP is a good example of not understanding economics. Imagine a country with two individuals, each earning $50K, so total GDP is $100K. Along comes a poor immigrant who adds $20K to GDP, so not total GDP is $120K. Per capita GDP has fallen to $40K, but no one is made worse off and at least one member is made better off. So let’s cut to the chase. What W. C. Varone is really worried about is some mental image he has of a lazy, mooching illegal taking siestas all day long and stealing hard earned savings from upstanding, hard working citizens like himself. It’s today’s version of Ronald Reagan’s famous “strapping young buck” buying T-Bones with food stamps while hard working (white) folks eat Hamburger Helper. Now I don’t think you fall in that category. Where you and I disagree is over the citizenship issue. We should be making citizenship easy and broad based. Instead we see Republicans trying to narrow citizenship. Why? They pay taxes. They work hard. They learn English and at the same time enrich the English language. They obey the laws better than native born Americans. They serve in our military. They support many of the same retirees and rentiers who complain on this blog about lazy layabouts who won’t work…irony of ironies. Citizenship is not a privilege…that’s Old Europe thinking. Citizenship is not something that should be husbanded.

    3. Peter Schaeffer

      “All they care about is fighting against anything that might raise their taxes by a few bucks despite the clear long run benefits to the economy of expanding immigration.”

      What long-term benefits to the economy? A bigger GDP? Yes. Higher per-capita GDP? No. Like it or not, the immigrants America is actually getting will be a multi-generational burden (at best).

  10. Joseph

    Rick Stryker: “Trump has high negatives among Republicans.”

    The latest poll from Washington Post/ABC shows:
    Republicans say by 64-35 that Trump is “qualified to serve as president.”
    Republicans say by 60-35 that Trump is “honest and trustworthy.”
    Republicans say by 53-45 that Trump understands the problems of people like them.
    Republicans say by 54-42 that Trump “has the kind of personality and temperament it takes to serve effectively as president.”
    These are better numbers than any other Republican candidate.

    The latest Quinnipiac poll shows that:
    Trump has a 60 – 35 percent favorability rating among likely Republican Iowa Caucus participants, as these voters say 56 – 35 percent that he is honest and trustworthy and 61 – 32 percent that he cares about their needs and problems. He has strong leadership qualities, voters say 83 – 15 percent, and the right temperament and personality to handle an international crisis, voters say 52 – 41 percent.

    A Gallup poll shows that Trump’s net favorability (favorable minus unfavorable) is 32%, higher than any other Republican candidate.

    Trump has high negatives among Democrats but Republicans love him.

    1. Rick Stryker


      Yes, you are right that Trump’s unfavorability ratings among Republicans as measured by polls have improved a lot since the summer. But I don’t think that reflects the true situation with Trump but rather the enormous media attention he’s been getting, which the former reality tv star has been very good at drumming up. I think the situation will change as we get into the primaries. Here’s why:

      1) At this point, the polls don’t mean a lot as people aren’t very focused on the election. Certainly in recent history, the front runners at this point in the cycle who had similar support as Trump did not win the nomination: Howard Dean was on top in 2003 with Kerry in fourth place; Hilary Clinton was leading Obama in 2007-8, Giuliani was in the lead in 2007; Rick Perry was surging past Romney in 2011, etc.

      2) Trump is hated by the establishment Republicans. It’s true that anti-establishment conservatives such as Rush Limbaugh, Ann Coulter, Sean Hannity, etc. like him, or are at least not opposed to him, but donors, the party leadership, intellectuals, writers, etc. seriously dislike him. Glenn Beck thinks his fellow media people have gone mad supporting Trump and Bill Kristol has openly talked about fielding a third party candidate if Trump did somehow get the nomination. It’s difficult to see how a candidate with this much opposition from the Republican establishment can succeed. I could never imagine myself voting for Trump and I don’t know anyone who would.

      3) Trump is not a Republican. The voters have not really focused much on the race at this point and so don’t understand this. You can’t be a Republican and say that single payer health care works or that we should raise taxes on the rich as Trump does. Nor can you really be a registered Democrat from 2001-2008, have supported Kerry in 2004, and have said that Bush was the worst President in US history, as Trump has done. Krugman approves of Trump’s economic views–nuff said! The only specific policy that we’ve gotten from Trump is that he’ll build a wall on the Southern border (which Mexico will pay for) and then round everyone up and deport them. That’s not any legitimate Republican’s position on immigration. Otherwise, Trumps’ answer to every policy question is “I’m a billionaire. I’m very successful. I’m going to put the best team that’s ever been put on the problem. We’ll solve it day one. Day one. It’s going to be YUGE!” As people start to focus, Trump will have to get more specific, which he can’t do. Then his negatives will rise.

      In my view, Trump’s chances of winning the nomination are very low. If I’m wrong, I’ll have to start to consider the unthinkable: voting for Hilary as the lesser of two evils

      1. baffling

        “You can’t be a Republican and say that single payer health care works or that we should raise taxes on the rich as Trump does.”

        and this is why the republican party has such difficulty winning the general presidential election recently. their ideology is killing them. consider that if romney had simply said obamacare is nothing more than romneycare in sheep’s clothing (no need to even endorse single payer system), he probably could have won the general election. but he turned his back on his own system, to appease the “establishment”. times are changing, and the republican party is not changing with the times. their rigid ideologies are a significant hindrance to general election success. immigration will probably be the party’s downfall in the next election, unless the nutcases pushing the planned parenthood issue wreck the train first.

  11. Rick Stryker


    I was puzzled to see in your comment a reference to Thoreau. Thoreau essentially argued the opposite of what you are saying, i.e., you have no obligation to obey an unjust law. Perhaps you meant that you would pull Thoreau out to refute him? If you were looking for support for your position, you might refer to the Crito. I hope not though. Plato was the original socialist–a surprisingly modern big, big government progressive who was an enemy of freedom.

    I’m with Thoreau in that I don’t think we need to or should obey unjust laws. Taking the case of the speed limit, I’ve driven on the NJ turnpike for example and I can confirm that almost no one drives the speed limit. Moreover, the police do not enforce the posted speed limit. What happens in practice is that since the speed limit does not make sense on that road, it is widely disregarded and the police tolerate higher speeds. They don’t really enforce the speed limit until you are at least 12 mph over the posted limit. People who are stopped are usually going above 85 mph. I think this is true on most Northeast highways. Under these circumstances, am I obligated to follow the posted limit?

    I don’t think so. If I follow the posted limit, I increase rather than reduce the risk of accidents, since people will be impatiently trying to get around me. The right thing to do it seems to me is to obey the implicit speed limit that the drivers and police have established by informal contract. If I did receive a ticket for disobeying the posted speed limit, I would complain. In fact, I feel completely justified in protecting myself from such a ticket. I have front and rear radar detectors installed in my car plus front and rear laser jammers.

    The situation with enforcement of immigration laws seems analogous to the way the speed limit is enforced. The immigration rules don’t make sense and so they are not really enforced. Why start enforcing something that doesn’t make sense? People will obey and enforce laws that are just and make sense. Better to focus on changing the immigration system rather than focus on enforcing existing laws I would think. I certainly don’t favor rounding people up and deporting them like the Donald is saying.

    1. Vivian Darkbloom


      Yes, I was merely anticipating the next argument and you didn’t disappoint me. So, you are going to stop paying your taxes because you disagree with the NJ speed limit and the current status of immigration law? We can talk about Thoreau when we’re faced with some other examples, but I don’t think these two qualify for serious consideration.

      One of the purposes of law is to ensure that sanctioned behavior is well defined so that people can anticipate what is expected of them. It’s actually a Constitutional principle enshrined in the concept of “due process”. At the moment, you can’t tell me what the actual speed limit is on the New Jersey Turnpike because your Humpty Dumpty view of legal interpretation isn’t very predictable. Our laws shouldn’t be gauged by palm readers and pulse takers.

      Ironically, if the speed limit in New Jersey would have been enforced, it would most likely have been changed by now to more accurately reflect “public opinion” and “morals” as Steve calls it. That’s how a democratic country governed by the rule of law is supposed to work. People would have put pressure on lawmakers to change that unpopular law and everyone, including the institutions of government, would be the better for it. The same is true of the immigration issue. As it stands, there is no real pressure to change either because the laws as they now stand are not being enforced. In this respect, in partial response to Baffling, I am being principled, pragmatic and non-shortsighted. My way results in change that is orderly, predictable, democratic, fair and, yep, even moral. And, that change probably happens quicker than a system of gradual erosion.

      I have seen a more than subtle shift in the attitudes of Americans towards its institutions of government and its legal system. For example, the Executive, echoing some of the sentiments I’ve read here, doesn’t think he needs to enforce laws that he believes are bad or unpopular (according to whom?). As a result, the democratic process and the institutions of government are being damaged. I also perceive that, partly due to the internet and bloggers who view themselves as the new Philosopher Kings, decisions of the Supreme Court, election results, individual criminal cases, etc. are being tried in the court of “public opinion” rather than the institutions specifically created for that purpose. There’s an ocean between me and you, at least geographically speaking, so these changes might be more apparent to me than someone driving on the New Jersey Turnpike on a regular basis.

      These changes in our attitudes towards law and our government institutions are, I think, creating a rather messy situation, and I fear that the long-term consequences will be quite negative for the country I still belong to (and, those US government institutions called the INS and the IRS agree!). We need to work within our Constitution and the institutions created thereunder to effect change and not effect that change through subverting that system. Laws should be changed, not eroded. The principled, pragmatic and non-shortsighted view, I think, is that if you work outside the system to overturn what you perceive to be defective results (according to your own subjective views of “public opinion” and/or “morality” you will do more damage to that system than good.

      1. Steven Kopits

        Actually, the speed limit by practice is very well known. It’s the speed limit + 15 mph. It has been that way on the NJ Turnpike for at least 40 years, in my experience.

      2. Steven Kopits

        Let me answer you in detail, Viv, because I think you make important points.

        “Ironically, if the speed limit in New Jersey would have been enforced, it would most likely have been changed by now to more accurately reflect “public opinion” and “morals” as Steve calls it. That’s how a democratic country governed by the rule of law is supposed to work. ”

        In a sense, this is true. However, the default form of government is dictatorship, not democracy. Thus, you are positing that the voter is the principal, and the politician is the agent. In general, the trend goes otherwise: the politician is the principal, and the citizen is the agent. When we talk of being a ‘subject’ of the Queen, we are talking about the citizen being an agent, not a principal. The Queen in the principal; that’s why the ‘subject’ is subject. That the voter is today considered the principal is a function of the elaborate checks and balances devised by the Founding Fathers specifically to prevent the natural order of governance–dictatorship–from re-emerging. Notwithstanding, the individual citizen will always be at a disadvantage compared to the political order.

        Thus, for example, conservative groups have received intimidating audits from the IRS, and one member of the Supreme Court has decided on an Obamacare and gay marriage of which the public would not approve. Therefore, the notion that somehow the voters are in charge must be highly qualified. In many democracies–and I could name Greece, Hungary, Argentina, Italy or Turkey–to name just a few, voters rights are still substantially curtailed. To suggest that a single voter could change the speed limit on the NJ Turnpike at some reasonable investment of time and effort, well, good luck with that.

        “As it stands, there is no real pressure to change either because the laws as they now stand are not being enforced.”

        Surely levels of enforcement must also be the result of the democratic political process, no?

        In fact, I would argue that border control is, more or less, enforced. However, in an open economy like the US, keeping people out is highly problematic. Menzie has pointed out the silliness of proposing a wall with Canada, and that’s absolutely right.

        Thus, true immigration enforcement depends upon the identification, arrest, processing and deportation of those already in the country. This morning at the breakfast table we estimated that we have something between a few hundred to perhaps 1,000 or so illegal immigrants living in Princeton proper alone. This in a town of 40,000. Now, we know who they are and where they live, pretty much. On the other hand, these are the very people cutting our grass, cleaning our houses and selling us coffee at Starbucks. They are part of the community and there is absolutely no local appetite to round up these people in some Gestapo sweep at quite considerable expense to the municipal budget. We consider them ‘us’, not ‘them’, and that’s because they are constructive members of the community. We do not view them as criminals just because they are here without documentation.

        This is also democracy.

        “We need to work within our Constitution and the institutions created thereunder to effect change and not effect that change through subverting that system. Laws should be changed, not eroded. The principled, pragmatic and non-shortsighted view, I think, is that if you work outside the system to overturn what you perceive to be defective results (according to your own subjective views of “public opinion” and/or “morality” you will do more damage to that system than good.”

        I absolutely agree with this statement, and it underpins my proposal. However, if I believe in economics–and I do–then I understand my decision space is constrained. I don’t have unlimited flexibility in fashioning legislation. So the key is the channel the flow of immigrants, rather than try to stop it. To wit:

        1. We will not deport people already here in any meaningful quantity. We lack the funding, the will, and the manpower. Talking about it is like talking about the Canadian Wall. Ain’t gonna happen, even if that were the correct and principled outcome.

        2. The Wall will not prevent illegal immigration. There are many ways to get into the country besides the Sonoran desert. Overstaying a visa is all to easy, and once an illegal is in, we know we lack the mechanisms to really find and deport them, at least in quantity.

        3. If we obstruct commerce, we will create a black market. If I am, say, an lettuce grower in California and I cannot obtain timely, convenient and affordable labor legally, then I will face an existential crisis: Either I suffer potentially fatal financial losses, or I turn to the black market. Thus, curtailing affordable, timely and convenient immigration will result in employers colluding with illegal labor, thereby providing illegals with an economic lifeline. Trying to block the flow of illegal labor will have the perverse effect of reinforcing illegal behavior.

        4. Black markets often involve physical danger, exploitation, fraud, crime, bribery, corruption, and death. If you create the incentive for a black market, you will have by definition created the associated crime. I need only mention the example of Prohibition.

        5. Even if you succeed in sealing the US borders, you will have only succeeded in crippling our economy and lowering our GDP growth rate. There is no competition in Princeton for the jobs the Mexicans are doing. There are few Americans clamoring to pick strawberries or clean chickens. If you fail to allow in external labor, then that economic activity will be curtailed.

        So, Viv, I am entirely in agreement with you about the need to follow laws. Absolutely. But laws need to be designed within an appreciation of the practical realities of human behavior and economic incentives. Do not ask people to act in some theoretically principled way if it conflicts with their economic necessities and everyday notions of commonsense morality. They will not comply.

        On the other hand, like governance, immigration is an easy problem to solve if we just apply those principles we learned in our very first economics courses.

        1. Peter Schaeffer

          “On the other hand, like governance, immigration is an easy problem to solve if we just apply those principles we learned in our very first economics courses.”

          Did they teach you that they solution to an unprofitable business is to expand it and make it more unprofitable?

          Low-skill immigration is a massive losing proposition for the U.S. Making it bigger will only make it worse.

          How to deal with it? Eisenhower removed 1-2 million illegals in 90 days with 1000 Federal agents. It wasn’t that hard.

          Your comments about lettuce are (among other things) a demonstration of a dire lack of knowledge. From “The Worker Next Door” (http://www.nytimes.com/2006/06/03/opinion/03chiswick.html). Quote

          “Employers facing higher labor costs for low-skilled workers would raise their prices, and to some extent they would change the way they operate their businesses. A farmer who grows winter iceberg lettuce in Yuma County, Ariz., was asked on the ABC program “Nightline” in April what he would do if it were more difficult to find the low-skilled hand harvesters who work on his farm, many of whom are undocumented workers. He replied that he would mechanize the harvest. Such technology exists, but it is not used because of the abundance of low-wage laborers. In their absence, mechanical harvesters — and the higher skilled (and higher wage) workers to operate them — would replace low-skilled, low-wage workers. ”

          Higher wages for American workers… The horror. The shame. The trauma.

  12. Steven Kopits

    So, a little more on the Market-Driven Immigration Policy

    In this world, we separate approval to work from the permit to work.

    As the process currently stands, the approval of the applicant and the issue of the work permit are comingled. These become independent in the proposed approach.

    Applicant Approval
    To my mind, approval of the applicant is largely unchanged in terms of criteria, ie, confirmation of identity, nationality, and eligibility (for example, no convictions or appropriate educational degrees, for example). Applicant approval merely makes one eligible for a work permit. It does not provide the right to work by itself. An approval might be valid for, say, 5 years if not earlier converted into a work permit.

    I personally would move to a universal standard of approval, that is, using Google, Apple or Microsoft identity interface, which would then be accepted by the government. In this way, the system could become more universal over time and materially liberated from government bureaucracy. For example, it could be extended to, say, the EU without need for further government infrastructure build out. Further, it could act as a de facto identity database in Mexico itself. Thus, rather than relying on proprietary and closed government identity databases, governments could each see particulars on Applicants.

    In addition, an open system would allow employers to rapidly identify and enroll workers. Just go to Apple iTunes and sign your guy in, and poof, and the electronic communication with the government is done through that. (More work to do be done on this.)

    The Work Permit
    The work permit itself would be a security which would be issued by the government, and could be bought and sold, like other securities. It could be purchased by applicants, employers, or financial investors. Like other securities, the price would be set in the marketplace (obviously subject to the pace at which permits are issued by the government).

    Permits would come in 3 month, as well as 1, 3, 5 and 10 year tenors with fixed start and end dates. Permits would have certain conditions, which I have outlined elsewhere, regarding tax rate, industry, etc. Again, we’d want just a few types, perhaps two or three.

    A Permit would become active when paired with an Approved Applicant. The would be the equivalent of activating your X-Box Live subscription.

    Benefits of the Approach
    In this system, both the Applicant and the Employer can move quickly, conveniently, and at a known price (which may not be low in all cases).

    Let’s take the case of the California lettuce grower. Let’s assume he needs 500 people for three months and is willing to pay the $800 for each 3 month permit.

    On Wednesday, he goes to Google jobs, and posts the following (in Spanish).

    “Tanimura and Antle requires 500 lettuce pickers from July 1 to September 30, in Salinas, California. For Approved Applicants, permit is included or reimbursed. Wage $10 hour, housing and transport included or reimbursed.”

    And he puts in keywords, agricultural labor, picker, lettuce, California manual labor. On the flip side, part of Google Pass sends texts to those enrolled who have clicked for notification related the keywords. If they accept, their particulars and references are automatically forwarded to the employer. If accepted in turn, the employer can provide them the activation number for the permit, and poof, they’re ready to go. Quick, convenient and affordable. No government bureaucracy at all.

    Alternatively, if the market is soft, the Applicant may purchase a Permit, and then wait and home jobs appear on the interface, or alternatively may go to the US in search of a job. Either approach works. If an Applicant no longer needs or wants a permit, he can sell the balance on the market, StubHub style. This re-sale provisions provide an incentive to return home in the absence of work. The permit is a wasting asset. If you don’t think you can use it, better to sell it and go home. You can always buy a new permit later if needed.

    So, that’s the basics of the proposed system.

  13. Vivian Darkbloom


    If you are suggesting that your proposals for reform are intended as changes to current law rather than a platform for civil disobedience, we may not be so far apart. But, you need to be clear on that very important distinction because you’re leaving me the impression that your proposals should be enacted before any laws are passed. If you are saying that pending acceptance of your proposals, we’ll just enact them de facto outside the existing framework of our government institutions, we’re still very far apart. I’ve written nothing (I hope) that suggests laws do not need to take into account practical realities.

    As far as some other comments, I’ve got some issues. First, it was not *one* member of the Supreme Court who ruled contrary to “public opinion” (a rather imprecise notion in the abstract, anyway) on gay marriage and Obamacare. It takes a majority of five. And, you’ve kind of nicely demonstrated my earlier point about trying to litigate cases outside the existing system of government. The Supreme Court is not an elected body. They are not directly responsible to public opinion (and I strongly believe they shouldn’t be). If the “public” does not like those decisions, there are procedures to overturn them. As regards gay marriage, that would be the Constitution. As far Obamacare, that’s the legislature.

    I’m not sure what the Queen has to do with it; we have a republican form of government, an indirect democracy if you will. Whatever the default form of government may be, we don’t (yet) have a dictatorship, nor do we (yet) have anarchy (which is probably the more likely default, anyway). In our democracy the expression of “public opinion” has (should have) its effect on public policy through the institutions of government. The system is not perfect, but the track record is pretty good by historical standards, at least until recently. I fear we’re losing that and the broader, big-picture institutional issues are more important to me than any relatively pedestrian issue du jour, such as immigration—or even the speed limit on the New Jersey Turnpike.

    1. Steven Kopits

      Viv, my thoughts:

      “If you are suggesting that your proposals for reform are intended as changes to current law rather than a platform for civil disobedience…”

      My proposal calls for the government to issue tradable securities in the form of work permits, and to migrate from a volume-based to a price-based immigration system. That’s a very big deal–a huge deal–in terms of government policy. It would take, at the low end, an act of Congress and a Presidential signature. At the high end, it calls for an act of God. It is by far, by two orders of magnitude, the most radical proposal for immigration reform that I have seen. It’s also reasonable, affordable, profit-making, optimistic, easy-to-implement, employer-friendly and humane. And it serves Republican interests in stemming the rise of the welfare state. Indeed, it would stand as the signature legislation in unraveling the welfare state, even as Republicans suck Latino voters right out of the Democratic party’s orbit.

      As regards domestic enforcement of immigration laws, I was not making a normative statements. I was trying to reflect the state of play. Princeton is a sanctuary city. I would not have voted for this, but my neighbors did (or at leas the town council did). As a practical matter, I can state that, barring some criminal act by illegals(dealing drugs, stealing, etc.), the citizens of Princeton will not condone the wholesale deportation of our own illegal community. That’s an analytical assessment, not a call to arms.

      “I’m not sure what the Queen has to do with it; we have a republican form of government, an indirect democracy if you will. Whatever the default form of government may be, we don’t (yet) have a dictatorship, nor do we (yet) have anarchy (which is probably the more likely default, anyway). In our democracy the expression of “public opinion” has (should have) its effect on public policy through the institutions of government. The system is not perfect, but the track record is pretty good by historical standards, at least until recently. I fear we’re losing that and the broader, big-picture institutional issues are more important to me than any relatively pedestrian issue du jour, such as immigration—or even the speed limit on the New Jersey Turnpike.”

      If you use a Three Ideology Model, as I do, then dictatorship is the default system of government and democracy is a decayed form of dictatorship, with power migrating from the center to the periphery over time (due to DMUWI). This is a very important point. We’re taught in schools in the US that democracy is the ‘natural’ form of government and dictatorship is an abomination. Thus, we are left with a binary choice: democracy (good) or dictatorship (bad). Consequently, we are hard-pressed to distinguish between democracy in, say, Venezuela and democracy in Norway, or for that matter, between democracy in New Jersey and democracy in Wisconsin.

      By contrast, if you view democracy (and other forms of self-determination) as decayed or decaying forms of dictatorship, then democracy is a process, not a destination, the choice is not binary, and we have some method to contrast democracy in Argentina, for example, with that of the UK. They are not, and do not have to be, the same thing. But note, dictatorship does not go away! It is merely diluted over time. So, the fact that we call something a democracy does not mean it does not reflect more of the characteristics of a dictatorship. That’s where we are with, say, Venezuela or Turkey, and frankly Hungary is not exactly a model democracy either. Hence, when you say we have a democracy, well, yes, but of a kind.

      Now, if you believe democracy is a process, and if I accept your premise that the pillars of democracy have been eroded in the US–which I do–then how do we strengthen the system? What is the next step in democracy? Well, the key is align the incentives of the political class with the long-term health of the country (assuming you take a Smithian view of the motivations of politicians). We want legislation to more closely align with everyday morality, practicality, convenience and prosperity. That’s how you turn respect for the law into respect for the Law. Put another way, you want to re-align the agent with the principal and thereby make the principal transparent. And if you believe that, then you want an FAA. That’s the next logical step in the development of democracy. It is this which allows the government to focus on Type II statistical errors, and not only Type I errors.

      So, if you want respect for the Law, you want to better align the incentives of politicians with the long term interests of the voters, and your primarily tool in that effort is an FAA.

      1. Vivian Darkbloom


        Thanks for engaging on this. It’s been an interesting discussion. If sometimes I appear to be hard on you it is only because I’ve come to view you as someone who forms opinions thoughtfully and objectively, so when it appears to me you are off track, I feel the need to push even a bit harder. If it were someone else whose opinions appear to be automatic (we won’t name names) I probably wouldn’t bother, unless it’s easy prey and I hadn’t yet bagged my limit for the day.

        I’m not sure I follow the entire thread, partly, perhaps, because to me the FAA is the Federal Aviation Administration (what do they have to do with it!) but let me just close by saying this:

        The next step to strengthening our democracy is to encourage respect for the institutions of government and protecting and restoring their proper roles as brilliantly laid out by those architects more than 200 years ago. If that sounds like a step backwards, well, maybe it is. So, when I think that very smart and normally wise people like you may be leading us in the other direction, I get really worried.

        You have the last word if you want it.

        1. Steven Kopits

          Here’s an FAA for the US: http://www.prienga.com/blog/2015/3/19/a-bonus-plan-for-politicians

          And one for Greece: http://www.prienga.com/blog/2015/2/19/a-program-for-greece

          Viv, don’t worry about being hard on me. Either what I am saying is defensible, or it is not. If it’s not, well, I will change my mind or modify my proposal. But I not infrequently propose things way out on the spectrum of policy. That’s why we’re here at Econbrowser, to expand our minds and discuss how certain problems might be approached.

          I am not calling for a lawless society, merely conceding Menzie’s point that immigration policy as proposed by the current suite of Republicans is unlikely to move us forward from the current status quo. Indeed, I find the notion of a wall deeply troubling. It does not represent my values or my vision of America. We are a shining beacon, not a granite fortress. I think we can do better, gain better control over immigrants here, provide more humane treatment and capture much of the value at the government level as a bonus!

          I have great respect for the Founding Fathers. But it is not lost on me that they made their peace with slavery, which was legal for nearly a century, even though it is an abomination to the conscience, precipitated the worst war in the country’s history, and remains a scar on our society to this day. Had we remained a subject British colony, slavery would have ended in 1833. As it was, our vaunted independence–the right to life, liberty and the pursuit of happiness–enabled slavery to persist thirty years longer.

          Part of the slave compromises required that Northerners return escaped southern Slaves to the South. Do you believe that we should been law-abiding and returned those slaves? Or should Northerners have provided illegal safe havens, as so many did? Perhaps we had a problem respecting certain laws even then.

          I am not equating immigration with slavery. I am merely pointing out that Americans have disregarded at least some laws for a very long time, and some laws were truly awful.

          With Syriza’s win in Greece, Tsipras has promised to crack down on corruption. I can tell him now that corruption arises from regulation and bureaucracy, from trying to prevent daily commerce consistent with everyday morality as it is appreciated by the average citizen. If he fails to liberalize the economy, corruption will persist. For you, this might represent the moral failing of the Greek people. (It is for Merkel!) For me, it’s a simple matter of incentives. I expect the individual to act in their own self-interest. That’s the Smithian view, and I dare say, those who believe in it have not been much disappointed in the last few hundred years.

          If you want respect for the Law, take a Smithian view of human behavior, that people act in their own interest. If a lawmaker has any sense, he will gear laws to insure that the individual is helping society when they are helping themselves. Align doing well with doing good, and the laws will be respected. That’s what my proposal does.

  14. Steven Kopits

    Peak, you ask some very good questions. Let me take a crack at them.

    “Without border security, why would a high price for work permits stop them?”

    First, we are speaking of people looking for work, not just crossing the border looking for social subsidies.

    There are two halves to the illegal work equation. One is the employee, the other is the employer. All other things equal, employers would prefer to hire legal employees. For example, in the Tanimura example above, the employer is empowered to buy permits on behalf of employees. Were Tanimura to violate the system, it could be kicked out with no option to purchase permits anymore. This would put it at a competitive disadvantage. Also, the system is providing a nice complete package of services. For example, Tanimura can recruit in Mexico with some knowledge of these employees, a simple interface to their own HR system, and some certainty that potential employees can cross the border in a timely and legal fashion. In other words, the key to compliance is to make it affordable, quick and convenient. If these conditions are met, employers will tend to comply. In turn, this will tend to force illegal labor to obtain permits. If I’m an employer and a guy shows up without a permit, I say, “Go to iTunes, buy a damned permit and come back in a couple of hours when you have it.” If the applicant can’t get a permit, then you know there’s something wrong with him.

    Importantly, this does not change the status of those not seeking employment. I personally do not believe illegal immigrants should get government benefits. But that’s not my call. I think, however, that many and probably most of the Mexicans coming up are really economic migrants. They are principally coming to work. At least that’s what I see in Princeton. I would add that one can put conditions of approval of an applicant. That approval is incredibly valuable, so you wouldn’t want to jeopardize it. If everyone can get a Permit, and you can’t, then pretty much you’re screwed. So immigrants will tend to be careful to protect their approved status.

    “Without illegal immigration, the domestic population would do the work for higher wages, raising the labor force participation rate.”

    Without immigration, by rights domestic wages for those competing with immigrants should be higher. True, at least in the short run. Of course, real wages would be lower for those now deprived of lower cost immigrant labor. That is, domestic grass cutters would benefit in Princeton, but Princeton homeowners would suffer.

    There are also two further considerations.

    First, I have argued that I really don’t think we can prevent illegal immigration, even with a wall. There are just two many ways to enter the country, and if the economy is booming, they’ll find someway to get in.

    Second, we don’t have the stomach to deport those already here. And really that’s the bigger issue. For those 11.5 million illegals here now, the impact on wages has already been absorbed and is in effect permanent. I’m not saying that’s good or fair, just that it’s probably the reality.

    “Are you suggesting if we offer money to illegal immigrants, some will leave the country?”

    Yes, the proposed system is very fluid. I don’t think we’ll have net fewer immigrants, but we’ll have fewer unemployed and unhappy immigrants hanging around.

  15. Steven Kopits

    Finally, I’d like to comment on the illegals already in the country. This is the most important issue.

    Now, this group, as we assume they have moved here permanently, will tend to want 5-10 year work permits. For them, this system would be a godsend. I imagine long tenor permits would trade at high values, probably above $25,000. They would obtain immediate status and certainty about their presence here for some time to come. Thus, we could register this whole group (at least the economically active members) in probably less than a year. They would get the right to live, work, move, open bank accounts, run businesses and the rest. Their lives would be so much better.

    On the other hand, they would not be eligible for social programs at the Federal level, but, in this model they would have a flat tax of 10% on say, the first $30,000 of income and, say, 16% above that amount. (Boy, I wish I could have that deal.)

    Now, here’s the Republican bit. Republicans only have to make sure the immigrants meet their own cost, since we don’t believe in redistributive programs. Democrats will need a higher tax rate to pay for social transfers. So Republicans can offer a lower tax rate, indeed, a lower tax rate than US citizens have. Thus, immigrants have an incentive I) not to be a burden on the state and II) not to become citizens. The way to beat the Democrats is not to be soft-hearted, but to offer a better deal–at least for those who want to come to work.

    Thus, by this approach, Republicans could offer a far more attractive deal to Mexicans, one which the Democrats could not undercut for ideological reasons, and one which the Democrats would be forced to vote against. That’s how you win the Latin vote.

    For Republicans, the key is not to be anti-immigrant, but rather to be anti-moocher. We’re the party of makers, not takers. Makers, whenever they come from, should be welcome here.

  16. Rick Stryker


    I like your immigration proposal–makes a lot of sense and I do think it could work politically.

    Did you see that Fiorina is now in second place in the new CNN poll? Menzie will be pleased that Walker seems to have imploded.

    1. Steven Kopits

      Barring some unforeseen event, the likely Republican candidate will be one of

      – Fiorina
      – Carson
      – Rubio
      – Bush

      I think Trump continues to fade. Cruz could be a dark horse, but he’s definitely behind the curve. Bush has shockingly slipped in the polls. (Take note, Hillary.) I like Carson–he worked a great deal with my father at Hopkins–but he has not been as sharp as I would expect. He’s really got to nail policy questions in the next debate to stay viable, I think.

      The rest are out, I think.

      So the real race looks increasingly like it’s going to be Fiorina or Rubio, if Jeb can’t pull himself together in a hurry.

  17. Rick Stryker


    Thanks for your reply and sorry I was not able to respond sooner.

    I certainly don’t go so far as Thoreau that I would advocate the sort of civil disobedience he does. I agree with you that laws should be as clear and well defined as possible, in order to have a nation of laws and not men. However, I think we are discussing the cases when that doesn’t happen, which is all too often. What do you do then? To what extent are you obligated to obey?

    I believe your view is that we should enforce the laws we have, even if they are suboptimal, in order to effect an orderly and legal change. Sometimes that may work but too often I think that strategy will fail. It’s important to ask how the law became suboptimal in the first place and why it is not already being enforced. The answers to those questions usually involve the way a political process in a particular country or jurisdiction fails, the economic and legal environment, and finite enforcement resources. In the case of speeding on the NJ turnpike, the police naturally come to accept that the true speed limit is higher than the posted. If drivers commonly disregard the law so that everyone is going faster, then the police have to decide who to spend their finite enforcement resources on. If the speed limit is 65, should they pull over people who are doing 67 or 70 while other people are flying by at 85 or 90? Of course, they choose the higher speeders to pull over, validating the implicitly higher speed limit. People do indeed agitate for higher speed limits, doing studies on whether there is a reduction in safety, and sometimes the speed limits are raised. But in some states, there may be an uneasy coalition between groups with different goals: people who think that the lower speed limit is important for saving fuel, people who don’t believe the studies or at least want to campaign on safety, and those who want to raise the speed limit. A situation where everyone tolerates a higher speed limit than posted is a way to achieve some sort of political equilibrium.

    It’ very common in emerging market countries, as I’m sure you are aware, for informal legal systems and property rights to coexist with the formal system. That must happen since most small businesses and workers could not survive if they followed the formal rules, and the government and police understand this. No one wants to enforce the rules to effect change, because it would destroy the economies of those countries. In China, for example, the tax rate is about 45% but no one pays that. People commonly get as much as their income in non-taxed form–your company pays for a lot of things for you. As long as you don’t criticize the government, the authorities will look the other way.

    Current immigration policy is in a suboptimal equilibrium too which I don’t think will be corrected just by enforcing the laws. If we were really serious about enforcing the laws, we’d have to do what Trump is suggesting, which I don’t think anyone seriously wants to do. In all these cases, the way forward is to propose a new policy that can move to a better equilibrium. That new policy has to accommodate the competing interests and the reality of government failure. That’s very hard but it seems to me to be the only way. So, I’m not suggesting that we subvert the system but rather work within it.

  18. Vivian Darkbloom

    Thanks, Rick. I’ll just say this: Laws are, in *my* view, most often “suboptimal”. That’s quite natural since laws are, almost by definition, the product of multiple levels of compromise. People may agree a law is “suboptimal” for vastly different reasons. I doubt if you would take a poll and ask everyone whether a law, *any law*, is “suboptimal” you’d get a 99 percent affirmative response. The fact is, while I’ve got my opinions about whether specific laws are suboptimal or not, and would have specific reasons for making that judgement, nobody elected or appointed me legislator, executive or judge. Immigration is, right now, a particularly contentious issue. Even more reason to change the law through an orderly, well-defined process.

    1. baffling

      so vivian, would you approve of the approach to secure the borders first, and only then discuss how to overhaul the immigration system? or would you move to directly overhaul the immigration system now? i ask this in light of the fact it appears most people on this blog agree the current laws are not working, and are unlikely to ever be effective as written because they are not enforced.

      1. Vivian Darkbloom

        Why do you seem to think that enforcing current laws and holding a discussion are simultaneously impossible? I agree, we should reform the immigration law and I actually agree with a lot of suggestions mentioned here by others. Until that reform is accomplished, discussion is necessary and desirable but current law should be enforced. Really, it’s not complicated, or, in my view controversial.

        1. baffling

          vivian, i think you’re response has been countered by reality. the reality is, the laws cannot be enforced effectively. it is the classic case of prohibition. when laws are written that are dumb and unenforceable, they will not be followed. i think you have found steven, rick and i all in agreement on this item. that should scare you. so when i hear politicians claim, first we need to secure the border, and only then can we overhaul the system, i question what their real motives are. it seems to me the best, and probably only, path to success on the immigration issue is an overhaul of the current system as soon as possible. trying to enforce laws which are unenforceable does not appear to be part of the solution. we need to quite wasting energy on the “wall,” which is not part of the solution, and focus on policies and initiatives which can give us our desired outcomes.

          i do find some of steven’s ideas interesting. it plays into some of my thoughts on the immigration issue and free markets. we have many folks on this blog who are free market enthusiasts, vehemently against any government intervention in the free market process. but labor to an extent is a commodity (or naively can be viewed as such). when we create extensive restrictions on the mobility of labor, such as with immigration policies, the government is intervening to a great deal on this free market process. and yet many free market enthusiasts take that exact position-government should strictly control the supply of labor. now if you follow stevens policy, he takes the social support out of immigration and work permits. hence one cannot argue we are bringing in a bunch of takers who mooch off the makers of society. so if one is still against the very flexible policy steven has proposed, i suppose one should identify themselves as a protectionist rather than a free market enthusiast. anyways, i find it interesting that so many people who would claim to be a free market supporter are actually adamant supporters of big government protectionism, at least when it comes to the immigration issue.

      2. Steven Kopits

        Actually, you could run both systems concurrently. It’s just a matter of how many permits you issue per system.

        I would note that the proposed system is intended for economic migrants, ie, those looking to work in the US. It is not intended for, say, political refugees per se. It’s not that it couldn’t accommodate them (the government could waive the permit fee), but it’s really geared to those intending to come here and work.

        Further, there would be a huge benefit to splitting approval from permits, and out-sourcing the approval function to Google, SAP or Microsoft. In such a system, a person could be pre-approved without applying for a work permit. That may seem odd, but consider the story I heard on NPR today. It was about Syrian refugees and a US State Dept rep saying it could take two years to re-settle them in the US due to all the paperwork. Now, in an outsourced system, let’s call it GooglePass, the paperwork could be completed and held by a third party, Google. Or maybe DNV or Lloyds Register (these guys certify ships) or Kroll (experts in background checks). If I were living in a war zone, I would apply pre-emptively, just to offset the risk of becoming a refugee. Then, if I could afford the permit or the host government would waive it, my family could be re-settled quickly. In addition, an out-sourced system could be used by many countries, ie, a common app by which I could be accepted either into the US or Germany (or Harvard or Yale, for that matter).

        In any event, you could run the new system in parallel with the old system for as long as that’s desirable.

        1. Gian

          “The approval of the applicant is largely unchanged in terms of criteria, ie, confirmation of identity, nationality, and eligibility (for example, no convictions or appropriate educational degrees, for example).”

          How wouuld one verify “no-convictions” and “appropriate educational degrees” of foreign nations? There is plenty of scope of fraud here. Would one really trust “no-conviction certificate” from Chad Police? or “educational degree from Niger?

          1. Steven Kopits

            So, a couple of points.

            Nationality would be a qualifying criterion for an applicant. Thus, for example, I would probably limit the test period to just Mexican citizens. If it works out well, you can always add countries.

            As for background checks, that’s a good question. I don’t know how State does it. Here’s how I would do it:

            – Confirm with issuing country’s dept of interior/foreign office that applicant documents are genuine
            – Check key jurisdictions for criminal record associated with applicant name
            – Check own lists for “no admit” status, eg, a terrorist with no criminal convictions in his own country but who is excluded from your list for some reason.

            Now, I’m guessing the time consuming bit is the interface with the foreign government. But that function can be out-sourced to a third party and paid for by the applicant. For example, Kroll, who does background checks, could be empowered to confirm key documents. So, suppose I am a Mexican wanting to be an Applicant. I go to a Kroll office somewhere in the country (there will be several), fill out the paperwork, do the biometrics, and empower Kroll to confirm the key documents (passport, drivers license, etc.). Kroll confirms these with the Mexican government and certifies the documents for the US government (or more precisely, the iPass system, which can be used by multiple governments).

            The quality of Kroll’s work is controlled by the US government by using spot checks, and obviously, in the event the system should break down. In 99% of the cases, we’re talking simple citizens, so it should be pretty routine.

            The system cannot, of course, prove that the Mexican or Chinese government has issued someone a false identity. However, if biometrics are used, then a foreign government can only do so once. If Gail Chen is really Jing Shen, then the system will record here as Gail Chen, and thereafter, that’s who she is. So with government collusion or incompetence, an Applicant could escape their past, but only once.

            I more and more like the notion of an open system. It would be a big business. So, suppose you are a Syrian dentist circa 2010. You can see things begin to deteriorate, so you decide to create iPass identities. You go to the local Kroll representative, fill out the paperwork and biometrics, and empower Kroll to confirm the documentation. They confirm the documentation and you and your family exist in the Apple iPass system.

            For five years, nothing changes. But suddenly, you have to leave the country and end up in, say, Hungary. Now, you show up in Hungary with nothing more than the clothes on your back. You give the passport control guy your iPass information, which he can pull right up from the internet. And you exist. No need to confirm anything, which would now be pretty darn hard in Syria. They know who you are at State, in the field, and in Germany and the US as well. You’re ready to be re-settled, right then and there.

  19. Peter Schaeffer


    A lot of folks seem to be missing a crucial point (set of points). Let’s say the U.S. adopted the Kopits plan. What level of immigration would then follow? Zero is a pretty good estimate. Why? Because without the welfare state people at the bottom of the economy wouldn’t tolerate immigration for a day. They would revolt and force an immediate end to all immigration. Don’t believe me? Check out what really happened in the years from 1890 to 1914.

    However, the revolt wouldn’t be limited to poor, working class people. Once it was understood that the welfare state had been abolished to make possible Open Borders, the revolt would include such a broad swath of society that immigration would be unthinkable for 50 years.

    To put this bluntly, the public won’t accept eliminating the welfare state to make possible Open Borders. Right now we have the worst of both worlds, very limited immigration enforcement combined with a massive (and fast expanding) welfare state. Sooner or later we (the US) will have to choose. It should be pretty obvious that the border will be closed.

    1. Vivian Darkbloom

      I followed the related discussion over at Marginal Revolution. I encourage anyone interested in the topic to read the very interesting set of comments there (following a rather shallow and unsubstantiated assertion made by Alex Tabarrox regarding “Open Borders and Welfare”). You may not agree with Peter Schaeffer, but I think you’ll find what he had to say over there very interesting.


      1. Steven Kopits

        Of course, I read it closely, Viv.

        Here’s one of Peter’s comments which caught my eye:

        “Farmers will either mechanize, pay natives enough to get them to work (a tragic thought), or switch to higher productivity crops.”

        What’s wrong with this? First, not all agricultural processes are easy to mechanize. The technology is some cases doesn’t exist, and may be hard to develop.

        Are there really a lot of Americans who want to clean chickens and pick strawberries? Is the some large number of natives clamoring for these jobs?

        And finally, the notion that farmers would switch to higher productivity crops is insulting. It assumes that there are somewhere higher productivity crops out there which farmers are ignoring. If they existed, the farmers would already have switched.

        Rather, Peter should have said,

        “A decrease in immigration will cause the price of labor to rise, potentially substantially so in some sectors. In the case of agriculture, to the extent cost effective technologies are not developed and deployed in short order, the sector will shrink as higher prices will move production offshore or simply reduce appetite for the given product. The US no longer makes sandals or clothing. We can outsource food production just as easily.

        “As for domestic and retail services, professionals should clean their own houses and suffer the loss of productivity which goes with it. Or maybe their houses shouldn’t be as clean.

        “Reducing immigration, whether legal or illegal, carries a price for the economy, a price that is greater than the wages of the immigrants foregone. However, the cost to taxpayers of immigrants alas implies that immigration creates a loss of welfare for taxpayers. The country as a whole is better off, but natives as a whole will experience declining well-being due to the impacts of the welfare state.”

        Had he said that, I might be more sympathetic.

  20. Steven Kopits

    Nonsense, Peter.

    My plan in not ‘open borders’, but rather immigration based on price, rather than queuing. It is geared to makers, not takers. The number of visas is modulated by price, rather than quantity. However, there is nothing to prevent the government from reducing the number of visas and letting the price rise. This is no different from practice today.

    Now, the bigger question is whether it facilitates ‘welfare migration’, whereby people buy a visa and overstay it. I am inclined to think a well-regulated system would see better compliance overall. However, if US bureaucrats are willing to sign up all comers, regardless of legal eligibility, well, we have to think about that one. In such an event, entry into the country is tantamount to eligibility for government handouts.

    If this occurs on any scale, if I were a Republican candidate, it would be a major talking point, as it constitutes vast fraud in which both government employees and illegal aliens are complicit. Some people need to go to jail, if true.

    However, if this can be managed, trust me, you’d like living with my system better.

  21. Peter Schaeffer

    “My plan in not ‘open borders’, but rather immigration based on price, rather than queuing. It is geared to makers, not takers. ”

    In a welfare state (such as the United States) even low-skill makers, end up being massive takers. Why? Health care alone ($12 per-hour on average) dwarfs the income of low-skill immigrants, much less what they pay in taxes. Of course, many low-skill immigrants don’t work at all. That makes them pure takers.

    If you set, the price of visa’s high (and don’t change anything else), you have the status quo. In order words, large-scale illegal immigration and taxpayers exploitation with the few (employers and illegals) exploiting society as a whole.

    “Now, the bigger question is whether it facilitates ‘welfare migration’, whereby people buy a visa and overstay it. I am inclined to think a well-regulated system would see better compliance overall”

    A well-regulated system is what we don’t have. The notion that the government is going to sell visas and then quickly deport violators doesn’t sound very plausible.

    The core problem is multi-fold. First, Once people gain entry to the United States, they become eligible for very expensive handouts (notably education and health care). Second, the costs are borne by society as a whole. The profits are privatized. For better or worse, immigration is primarily rent-seeking (on the part of the immigrants and employers). Third, the predictable alliance of cheap labor employers and racial special interest has blocked any effort to secure the border or enforce immigration law so far. Employer visas won’t change any of that.

  22. Peter Schaeffer


    “What’s wrong with this? First, not all agricultural processes are easy to mechanize. The technology is some cases doesn’t exist, and may be hard to develop”

    Actually, a long list of produce crops already have been mechanized, but not in the USA. The USA was once a world leader in agricultural technology. Then we stopped enforcing the border… Now the U.S. a genuine laggard. Let me offer a few quotes that should help you understand this. From “The Worker Next Door” (http://www.nytimes.com/2006/06/03/opinion/03chiswick.html?_r=0)

    “IT is often said that the American economy needs low-skilled foreign workers to do the jobs that American workers will not do. These foreign workers might be new immigrants, illegal aliens or, in the current debate, temporary or guest workers. But if low-skilled foreign workers were not here, would lettuce not be picked, groceries not bagged, hotel sheets not changed, and lawns not mowed? Would restaurants use disposable plates and utensils?”

    “Employers facing higher labor costs for low-skilled workers would raise their prices, and to some extent they would change the way they operate their businesses. A farmer who grows winter iceberg lettuce in Yuma County, Ariz., was asked on the ABC program “Nightline” in April what he would do if it were more difficult to find the low-skilled hand harvesters who work on his farm, many of whom are undocumented workers. He replied that he would mechanize the harvest. Such technology exists, but it is not used because of the abundance of low-wage laborers. In their absence, mechanical harvesters — and the higher skilled (and higher wage) workers to operate them — would replace low-skilled, low-wage workers.”

    Outside of the U.S. grapes are harvested with machines. In the U.S. its illegals. A typical quote follows.

    “with an abundant and reasonably priced labor force at hand…why bother pushing for research into added mechanization.”

    History provides another example. After WWII, the U.S. used Braceros (Mexican temporary labor) to harvest tomatoes in California For a number of reasons (abuses of workers), the Bracero program was shutdown. The usual special interests claimed that tomato production in California would end. Once the Braceros were gone, the growers immediately mechanized. The number of workers plunged, productivity soared as did production. Did I mention that wages went up… A lot. Quote from Philip Martin.

    “The mechanization of California’s processing tomatoes illustrates the discontinuous adjustment process. In 1960, over 80 percent of the 45,000 peak harvest workers employed to pick the state’s 2.2 million ton processing tomato crop into 50 to 60 pound lugs were Braceros. A decade later, almost all processing tomatoes were harvested mechanically, and fewer than 5,000 local workers rode on the machines to ensure that only ripe…”

    Philip Martin is America’s leading authority on agricultural labor. I quote

    “Proponents of a new temporary worker program argue that increased immigration enforcement would lead to fewer illegal agricultural workers and, as a consequence, the American consumer would face a major increase in the cost of food. This is factually incorrect according to experts. Dr. Philip Martin, a leading academic authority on agricultural labor, notes that American consumers now spend more on alcoholic beverages on average than they spend on fresh fruits and vegetables.1

    An average household currently spends about $370 per year on fruits and vegetables. If curtailing illegal alien agricultural labor caused tighter labor conditions and a 40 percent increase in wages, the increased cost to the American family would be $9 a year, or about 2.4 cents per day. Yet for the farm laborer, the change would mean an increase in earnings from $8,800 to $12,350 for each 1,000 hours of work (25 weeks if the worker worked 40-hour weeks). That increase would move the worker from beneath the federal poverty line to above it.”

    See also http://www.cis.org/GuestworkerPrograms-AmericanAgriculture http://www.cis.org/AmericanLaborMarket%2526Immigration http://www.cis.org/articles/2006/guestworkertranscript306.html

    It is perhaps true that “The technology is some cases doesn’t exist, and may be hard to develop”. However, the technology for switching crops always exists. For better or worse, you are defending the absolute worst cases of societal exploitation via Open Borders. Illegals in agricultural yield the fewest benefits to society as a whole and impose the highest costs on our nation. They are amount to undiluted rent-seeking (private profits, public costs). Basically, a system of organized (and for now legal) theft.

    “Are there really a lot of Americans who want to clean chickens and pick strawberries? Is the some large number of natives clamoring for these jobs?”
    After the Swift meat-packing raids, Americans (of all races) lined up for the newly available jobs. This was back when the economy was doing a lot better than it is now. Of course, some Americans get hysterical when anyone even suggests that American workers get a raise. Teddy Kennedy had a near-psychotic episode when Senator Dorgan (another Democrat) suggested that “chicken pluckers” might earn higher wages if America enforced its borders.

    “And finally, the notion that farmers would switch to higher productivity crops is insulting. It assumes that there are somewhere higher productivity crops out there which farmers are ignoring. If they existed, the farmers would already have switched.”

    Wow. I guess I need to explain the difference between “profits” and “productivity”. Farmers grow whatever they think is most profitable (to them), not what might be the most productive. As long as rent-seeking via imported cheap labor is possible, the most profitable crops may well have low productivity. Let me use an obvious example. Say I found a way to rob banks rather than work for a living. That would certainly be a lot more profitable for me. However, my productivity would fall below zero.

    Robbing banks is a crime. However, doing the same thing with illegals is OK (at least so far). They don’t pay the costs of illegal / low skill immigration. It’s politely called “privatizing profits, socializing losses”. See “That glass of OJ is squeezing back – Huge hidden costs of cheap labor are borne by welfare agencies, schools, hospitals, police – you.” (http://www2.palmbeachpost.com/moderndayslavery/reports/realcost1209.html). I quote

    “But cheap labor also generates significant hidden costs, costs that one national labor expert says are so staggering that an 8-ounce glass of fresh orange juice that retails for 42 cents from the carton really costs Florida taxpayers a whole lot more”

    “The migrants who pick Florida’s oranges are generally paid only 3.5 cents per half-gallon of fresh juice typically selling for $3.39 in supermarkets. Growers contend they can’t pay more because of narrow profit margins and competition from Brazil, where pickers, including children, are paid even less.”

    Meanwhile, the rising invisible costs of cheap labor to harvest our crops are being shouldered by welfare programs, schools and hospitals required by law to treat anyone with a serious illness.

    Many immigrants, legal and illegal, receive help from food stamps, infant and maternal nutrition programs, free and reduced-price school lunches, local health departments, churches and voluntary agencies. They increase demands on public safety programs and the criminal justice system. They require publicly paid translators and teachers of English-as-a-second-language.

    Florida is among six states that receive the most immigrants, along with New York, Texas, New Jersey, Illinois and the No. 1 immigrant destination, California, where the National Academy of Sciences has estimated that immigrants’ use of social services and schools costs every California household $1,200 a year in additional taxes. The academy projected the total cost to U.S. taxpayers for services to immigrants at $15 billion to $20 billion a year, while their economic contribution is pegged at $10 billion.”

    ““A decrease in immigration will cause the price of labor to rise, potentially substantially so in some sectors. In the case of agriculture, to the extent cost effective technologies are not developed and deployed in short order, the sector will shrink as higher prices will move production offshore or simply reduce appetite for the given product. The US no longer makes sandals or clothing. We can outsource food production just as easily.”

    The correct statement is

    “A decrease in immigration will cause the price of labor to rise, potentially substantially so in some sectors. In the case of agriculture, to the extent cost effective technologies are not developed and deployed in short order, land rents will fall to offset the rise in wages. Crop switching will occur with the U.S. producing more high-productivity crops and fewer crops where mechanization cannot occur. The U.S. will export more of some crops (high productivity foodstuffs) while importing more low-productivity crops.

    Overall, U.S. productivity will rise (dramatically in some parts of agriculture) as rent-seeking/organized theft is diminished and wages reflect the actual cost(s) of the labor.”

    Beyond that, 96% of illegals don’t work in agriculture. Second, According to the Pew Hispanic Center 47% of crop workers in the U.S. are legal. Perhaps more relevantly, 71% of midwestern crop workers are legal. Somehow America manages to produce food, even in the bleak, barren, and unproductive midwest. Third, illegals are the cliche example of privitising profits and socializnig losses. A quote from a recent article by Ron Unz should suffice.

    “Most immigrants, especially illegal ones, work at relatively low paid jobs, and the various taxes they pay simply cannot cover their share of the (extremely inflated) costs of America’s governmental structure, notably schooling. Furthermore, for exactly this same reason of relative poverty, they receive a disproportionate share of those government programs aimed at benefiting the working poor, ranging from tax credits to food stamps to rental subsidies. Immigration critics have persuasively argued that the current system amounts to the classic case of economic special interests managing to privatize profits while socializing costs, wherein immigrant employers receive the full benefits of the labor done by their low-wage workforce while pushing many of the costs—including explicit income subsidies—onto the taxpayers.”

    ““Reducing immigration, whether legal or illegal, carries a price for the economy, a price that is greater than the wages of the immigrants foregone. However, the cost to taxpayers of immigrants alas implies that immigration creates a loss of welfare for taxpayers. The country as a whole is better off, but natives as a whole will experience declining well-being due to the impacts of the welfare state.””

    What does it mean to say “the country as a whole is better off”? Higher GDP? Yes, that is almost certainly true. Higher per-capita GDP? Almost certainly not. Higher net consumption for natives? Probably not. A better future for America? Absurd.

    Dani Rodrik had an excellent comment on this a few years in a related context (trade). See “Deconstructing economists’ take on free trade” (http://rodrik.typepad.com/dani_rodriks_weblog/2007/09/deconstructing-.html). Quote

    “Once in a while you come across a paper that makes you nod in agreement and go “yes!” with every sentence you read. Robert Driskill’s Deconstructing the Argument for Free Trade is such a paper. Driskill is a distinguished economist who knows the theory of comparative advantage as well as anyone else. And his argument is not against trade per se, but about the manner in which economists present their arguments in public and in their textbooks. His main argument is that the standard renditions gloss over a key issue the resolution of which is anything but obvious: What does it mean for a change in economic circumstances to be “good for the nation as a whole”, even when some members of that nation are hurt by the change?

    In other words, instead of sticking to what they are good at–analyzing trade-offs–economists typically engage in amateur normative political theorizing about what is good for society.”

    Borjas later extended Rodrik’s analysis to immigration.

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