August 3, 2017 (San Diego) Merit based immigration is something that is worth discussing. The United States would be following the model of, among others, Canada, that give points to immigrants who speak English and French. However, what is animating this latest effort is not precisely getting the best possible immigrants. Rather, what is driving this latest effort is something darker in the American story. Nor is this the first time that people are excluded due to their national origin.
Nor is this the first time that either Senators Tom Cotton of Arkansas and David Perdue of Georgia push for this. Limiting immigration has been a long standing conservative goal. It would also have other effects. Why both economists and business leaders disfavor this.
According to the Atlantic:
In 2015, for example, of the more than one million legal permanent residents admitted, “44 percent were immediate relatives of U.S. citizens, and 20 percent entered through a family-sponsored preference,” according to the Migration Policy Institute, a nonpartisan think tank. Only 14 percent of those admitted came through a job-based preference. The “merit-based” immigration system, in theory, would increase the latter figure, as it would prioritize those who are highly educated and therefore considered more employable.
Such a policy would likely limit the supply of low-skilled workers, and might allow the administration to filter which immigrants it chooses to admit. And a merit-based immigration system could also help realize a longtime conservative policy goal—a reduction in the number of immigrants admitted overall
According to the administration, this would reduce the pressure on low wages to continue to go down. Never mind that research shows that many of those low skilled jobs that also pay low wages are overall not done by native born Americans. For example, picking your strawberries.
Part of the solution, and it is hardly a complete solution, is the issuance of temporary visas for workers to come in and do those jobs. After the crops are picked, or the summer is over, they can go back home. This sounds logical and doable, but the last time the United States tried this, the Bracero program was full of issues.
Conservatives have had a goal for decades to limit immigration from certain areas of the world. Chiefly, it has changed the racial component of the country. It has made the United States a very diverse country, with people who come from many areas from around the world.
They are also convinced that immigrants rely on welfare. However, provisions of the 1996 Welfare Reform Act make this a non-issue. According to Brookings:
The 1996 reforms changed almost every aspect of non-citizen eligibility for welfare benefits. Although the provisions are exceedingly complex, a rough general principle provides useful guidance. With some exceptions, non-citizens entering the United States after August 22, 1996, the date of enactment of the welfare reform legislation, are not eligible for most welfare benefits, including Temporary Assistance for Needy Families (TANF), SSI, Medicaid, and the State Children’s Health Insurance Program (SCHIP), until they have been in the U.S. for at least five years
This matters, since it also excluded children who were United States Citizens from these programs for five years. However, the chestnut that people come to exploit these programs remains strong in conservative circles. So is the idea that immigrants depress wages.
There is some truth at this for those in the country illegally. According to the Wall Street Journal:
Now, if people will work pretty much whatever they get paid then of course unscrupulous employers can get away with driving down wages. And no doubt some employers of illegals do exactly that. This then lowers wages in general of course: and thus the illegals have a greater effect upon wages than legal immigrants. For legal immigrants are protected by everything that the rest of us are protected by: minimum wage laws, basic treatment standards and so on. Thus we might say that the way to reduce the impact of illegals on wages is to offer some method for them to legalise their situation.
They make another critical point as to why those working these low wages who are not in the country legally do what they have to do in order to survive.
The obvious answer being that the illegals don’t have access to the welfare state. They don’t get Section 8 vouchers, don’t get SNAP, don’t get unemployment pay, don’t get the near 80 varied programs that exist. And that’s what explains the difference in labour supply. If an employer tries to take advantage of us legals with very low wages not only can we report them but also we can just walk away from the offer. We’ve got something we can fall back on other than a $2 an hour job. Illegals do not. And this is what explains the difference in labour supply.
So there you have it. The reason wages are depressed at the lowest levels is because employers ignore employment laws, and workers have no choice but work as many hours as possible to barely survive.
Low Wage Workforce
This reform, if enacted, will hurt US agriculture, that relies on foreign born low skilled workers. Some of the elements of this legislation include the increase in temporary visas. This is hardly a new proposal. It has been floating around since at least 2010. In 2012 the United States Department of Agriculture found that:
Several factors account for the slight decrease in earnings. First, the decrease in the supply of unauthorized labor leads to a longrun relative decrease in production, not just in agriculture but in all sectors of the economy. This, in turn, reduces incomes to many complementary factors of production, including U.S.-born and foreign-born, permanent resident workers in higher paying occupations. Second, with the departure of so many unauthorized workers, the occupational distribution of U.S.-born and other permanent resident workers necessarily shifts in the direction of more hired farm work and other lower paying occupations, such as food service, child care, and housekeeping, and away from higher paying occupations (a much larger category). The effect of this compositional change is to reduce the average real wage for U.S.-born and foreign-born, permanent resident workers in all sectors of the economy, even as real wages in many lower paying occupations rise.
This will skew the economy in not a good direction for many workers. It also means that people who would not take some jobs suddenly will. This actually is expected to reduce overall wages.
There is also a reality that farm groups are worried:
That’s because much of the labor force that picks the fruits, vegetables and other crops in the U.S. are undocumented and in danger of being deported. Farm groups have lobbied Congress for years to reform U.S. immigration policy by creating new legal paths for farmers to hire foreigners, but it hasn’t happened yet.
“The Farm Bureau supports border security, and I hope that this can be a step toward moving the entire debate forward,” Boswell said in an interview.
But farming or the need for an agricultural workforce wasn’t mentioned by Trump when he signed the orders during a trip to the Department of Homeland Security in Washington. He highlighted the need to dismantle the drug cartels and keep illegal weapons and cash from flowing out of the country during a speech after the signing.
We are not even mentioning meat packers and hospitality workers. They also rely on this workforce that at times lives in the shadows.
So this immigration reform is being couched as one to help American workers. The evidence does not point to this as a fact. It is meant in truth to change the composition of immigration into the country. If this concern was truly over wages, are we going to see a call for living wages?
It is also immensely ironic that the president’s grandfather, and that of his aide Stephen Miller, would have not come into the country under the standards of this legislation. Neither was an English speaker. Nor is this effort to limit immigration from undesirable parts of the world, unprecedented in American history. The Chinese Exclusion Act comes to mind, and it was passed for similar reasons.