This week’s thunderous storm clouds, darkening the sky over D.C., were an apt representation of the mood in the capital as the Senate started the debate on amendments to the bill that promises to overhaul the nation’s immigration system.
Clearly, supporters and the opponents of the bill and its provisions — from paths to citizenship to border security requirements — have geared up for battle. Moreover, whatever passes the Senate obviously will have a rough ride in the House.
Not surprisingly the discussion revolves around economic issues. Much immigration is due to economic opportunities, and economists have long shown that an influx of motivated and highly-skilled immigrants is, generally, a boon for the country that admits them.
Even low-skilled immigration, according to a number of studies, has had positive effects.
One frequently cited analysis with the title “The effects of low-skilled immigration on U.S. prices: Evidence from CPI data” (http://goo.gl/3s5Ez) demonstrated there are significant savings to those who purchase “immigrant-intensive services” when immigration restrictions are removed.
However, at the same time — as is often the case with studies in this area — the analysis also provides argument for those opposing low-skilled immigration by showing that the price effect is mainly due to lower wages for low-skilled immigrants.
A recent study written by researchers from the Harvard Medical School and CUNY found that immigrants from all walks of life have been subsidizing the Medicare Trust Fund to the tune of an astonishing $115.2 billion between 2002 and 2009 by paying in much more than they received in terms of services.
This is due to the fact that the population of immigrants, on average, has a much higher percentage of working-age taxpayers than the non-immigrant population.
The authors of the study were not shy in stating their conclusion, namely that: “Policies that restrict immigration may deplete Medicare’s financial resources.”
Adding another layer to this multifaceted topic, one of the most prominent labor economists in the world today, Harvard’s George J. Borjas, just released a working paper with the intriguing title: “The Slowdown in the Economic Assimilation of Immigrants: Aging and Cohort Effects Revisited Again” (the abstract is available at: http://goo.gl/FO2Py).
One focus of his study, likely to be noted in the immigration bill discussion, is on the “English language proficiency” of various immigrant cohorts.
He states that “The cohorts that entered the country prior to the 1980s typically experienced a 15 percentage point increase in their fluency rate during their first two decades, while the cohorts that entered the country after the 1980s show only a 7 percentage point increase.”
Borjas, in his conclusion, cautions readers from using the data he presents to make sweeping conclusions regarding human capital accumulation (“declining”) and economic assimilation (“much smaller rate”) of recent immigrant cohorts, but his findings are nonetheless likely to be prominently featured in the current political debate.
Given the thousands of papers that have been written by economic researchers on the topic, not to mention the studies by other social scientists, it is — perhaps — important to not forget the general lesson that one can draw from this body of research.
Thunderous denials by some in D.C. and elsewhere notwithstanding, removing immigration restrictions has usually been shown to increase a country’s innovativeness and economic growth, as well as the overall standard of living of its population.
Dr. Michael Reksulak teaches economics and public finance in Georgia Southern University’s College of Business Administration. He may be reached by email at mreksula@georgiasouthern.edu.