Open Borders and the Welfare State

Milton Friedman famously said that you can’t have a welfare state and open borders. I disagree. In many respects (not all), you can have open borders and a welfare state.

What we think of as the welfare state encompasses many different programs, many of which are not handouts. Social Security for example is mostly a forced savings program. For these types of insurance programs there is no problem at all as, for the most part, a person has to work and pay into the program to get money out of the program. For programs like schooling there is also no problem–even if the schooling is provided free to immigrant children–because the schooling leads to higher wages later in life which are taxed. In these cases, the immigrant children are really just receiving a loan which they will have to pay back from their own earnings later in life. The story for basic health is similar. Thus, the only cases where there is a worry about excessive transfers from citizens to immigrants is in pure handouts or health benefits to say the elderly. In these cases, I would simply say that such benefits are not available to immigrants or only available after five years or some such time period.

Addendum: I gave this answer in an interview for a Brazilian newspaper. You can read the full interview here although it is in Portuguese.

Comments

Some people get benefits without ever contributing:

http://www.spiegel.de/international/germany/german-court-rules-benefits-for-asylum-seekers-are-inhumane-a-845066.html

Ok so welfare would increase from 200 to 350 euros, but this is not enough to live in Germany. So i dont think it is large enough benefit to discourage people from finding a job. The question is whether they are qualified enough (do they have the cultural luggage? language learning skills? qualifications) to find a job in Germany? Will employers discriminate against them (...) ??? So yes, you can think of this welfare contribution as an investment, but will it pay off? I am not sure... (With people from Somalia, maybe not on average, with people from Syria maybe? )

Refugees are not legally allowed to work in Germany for the fist few months.

Yo,

This would be funny if it weren't so sad. The fiscal impact of Middle-Eastern immigration has been extensively studied in Sweden, Norway, the Netherlands, Germany, the UK, etc. The results are always dismal (just like the USA). Indeed, in Germany, a prominent leftist (Thilo Sarrazin - SDP) wrote a book about it (among other things). Note that we aren't talking about 200-350 Euros per month.

From a prior post...

A report just came out in Norway showing that each Middle-Eastern immigrant costs taxpayers $700,000 (net). From “Immigration Will Bankrupt Norway” (http://gatesofvienna.net/2013/04/immigration-will-bankrupt-norway/). Quote

” Non-Western immigration is unprofitable

Finansavisen [Norwegian financial newspaper] has gone through figures released by SSB [Norwegian Bureau of Statistics] and concludes that each non-Western immigrant, on average, costs Norwegian society NoK 4.1 million ($700,000).

The sums are astronomical, especially when considering that in 2012 alone, 15,400 non-Western immigrants arrived in Norway.

When Sigrun Vågeng was the director of NHO [The Confederation of Norwegian Enterprise] she presented a study which concluded that the entirety of Norwegian oil-generated wealth would disappear if this non-profitable immigration wasn’t halted. Back then the story was mostly ignored. In the meantime several years have passed, and today the numbers are even higher. Even so the MSM and politicians keep describing the official immigration policy as strict.

The figure is NoK 4.1 million:

This figure includes all taxable incomes minus public expenditures,” according to Erlend Holmøy, senior researcher for SSB.

Based on the approximately 15,400 non-Western immigrants that arrived here in 2012 this means an outlay of NoK 63 billion ($11 billion). This is the equivalent of two foreign aid budgets, or roughly half of the NoK 125 billion ($21 billion) taken from the Norwegian oil fund (wealth fund) that the authorities intend to spend this year.

“The cost of it all will have to be covered by the average Norwegian taxpayer, or it will lead to a reduction in capacity and quality of various publicly funded services,” says Holmøy to Finansavisen

If the non-Western immigration continues on a level equal to 2012, the funding costs will soar to NoK 2,900 billion ($493 billion) in the period between 2015-2100.”

All,

A few more notes for fun...

"For programs like schooling there is also no problem–even if the schooling is provided free to immigrant children–because the schooling leads to higher wages later in life which are taxed."

In corporate land, this is called "accounting fraud" and is considered to be a civil or criminal offense. What is wrong here? "Later in life" people have children imposing a new generation of costs dwarfing any tax receipts that might accrue. Even without a new generation of children, the taxes "later in life" don't approach the education boondoggles.

"The story for basic health is similar."

As I have pointed out (a few times), health care costs more than low-skill immigrants earn (by far). If low-skill immigrants paid 100% of their incomes in taxes, they would not even come close to covering their health care costs

Health care costs $12 hour for the entire economy. Low-skill immigrants don't even make $12 hour much less pay that much in taxes.

Here is a more honest statement "low-skill immigrants impose vast education costs on society that will continue for generation after generation because each new generation will never generate enough taxes to cover the costs of its children". Not PC, but quite a bit more accurate.

"For these types of insurance programs there is no problem at all as, for the most part, a person has to work and pay into the program to get money out of the program".

On which planet is this true? Certainly not the third rock from the sun. The vast majority of programs (in numbers and dollars) do not require any input. Ever heard of food stamps, WIC, Medicaid, Medicare, Disability, Section 8 housing, Obamacare, food stamps, SSI, Social Security, TANF, etc?

Do any of these programs require immigrants to pay in, even a very tiny fraction of what they collect? Of course, not. claiming otherwise is just an effort to promote Trump as an intellectual heavyweight.

I think the bigger issue is the displacement of "native" (for lack of a better word) labor. As native labor is replaced by lower-costing foreign labor, more low-skilled workers become unemployable, moving from the tax base to the unemployed welfare base. Even if immigrants don't go on welfare themselves, they cause higher welfare participation overall.

Thought Experiment: All mexicans go back to mexico tomorrow on a plane. What would happen to US economy?

"All mexicans go home" is not the alternative to Open Borders.

We dont have to choose between the two extremes.

Well, in his defense, he posed it as a thought experiment, not a false dichotomy.

The aviation industry would sure do well...

A boom in the economy.

Labor saving devices such as crop picking and domestic sanitation, no longer surpressed by low wage foreigners would finally enter the economy to increase per worker output.

An example is the cotton picking machine, these had been developed early in the 20th century but never took off in the farm economy since there was still lots of cheap labor to perform the job, sticking with hand picking was the safe choice with no need to buy expensive maybe unreliable machinery.

It wasn't until the 1950's that farmers started to shift to mechanically picked cotton and that was only due to labor shortages, the combination of WW2 and post WW2 employment boom plus the deportation of temp Mexican labor in operation Wetback forced the change

If we had had the same open borders cheap labor policies in the 1950's that we have today we would still be picking cotton by hand. This might make make Mr Tabarrok happy since he could sit on his veranda and listen to the darkies sing sweet low sweet chariot while picking his cotton but most people in the US are glad we have moved on.

How many labor saving productivity increasing products have been held back by the cheap labor open border fanatics?

You were doing good up until this point:

"This might make make Mr Tabarrok happy since he could sit on his veranda and listen to the darkies sing sweet low sweet chariot while picking his cotton but most people in the US are glad we have moved on."

Couldnt make your point without taking a cheap shot? Lame.

The open borders types have no problem yelling racists at everyone while at the same time supporting low wage jobs for brown people

Alex, like most open borders fanatics, constantly accuses opponents of racism.

So while it may be cheap, it is certainly in keeping with the tone already established.

Alex, like most open borders fanatics, constantly accuses opponents of racism.

That I've never noticed. He does openly despise cops. If the Fairfax County police were not so professional, they'd red flag the Tabarrok household to their dispatchers for slow-walking calls.

How do you know they didn't ? Has he already called the cops?

"If the Fairfax County police were not so professional"

That is the low bar you set for being a professional?

So ... higher minimum wages are good for the economy? (I can explain myself more fully if you like.)

Higher per workers productivity is good for the people of a country. More goods while at the same time the ability to pay more to workers so they can buy those goods

"So … higher minimum wages are good for the economy?"

Yup.

Perhaps they would be short term bad, long term good.

Yes. Societies where you hire a literate, numerate guy with a backhoe are much preferable to societies where you hire two dozen lumpenproles with hand shovels.

The downside for spergitarians is they might encounter a tradesman who presumes to ask them if they caught the game last night.

So … higher minimum wages are good for the economy?

Not if they're the issue of state-mandated labor pricing. What is good for the society is comprehensive mobilization of its extant labor force, a task made more difficult if you keep importing people to fill vacances.

The downside for spergitarians is they might encounter a tradesman who presumes to ask them if they caught the game last night.

Ouch.

The problem is importing low-IQ Mexicans. We could use much more high-IQ, high-conscientiousness people.

Strange how people post here without even knowing basic microeconomics 101.

anon - econ 101 is a 2-variable 1-period "perfect" economy.

It's useful building blocks for more useful work, but waaay to simplified for more complex or longer term things.

Of course higher prices means lower quantity demanded. BUT, a) there is a supply response, and b) there are temporal effects, such as towards more productive uses of labour.

My point is that market forces causing increased wages are far different from government mandated minimum wages.

We should ban oil and electricity, then we will invent a really cheap, clean energy source . And we need more wars and conscription, so we can have fewer people working and even more progress. Slavery is Freedom. Scarcity is Plenty. And never worry about demography: robots will produce our goods, fight our wars (when we have no human workers left to send to death), pay our taxes and fund our retirement.

We should not subsidize oil and electricity by importing cheap power using sweatshop labor and dirty fuel which prevents the investment in clean energy sources.

Wars and conscription, that has been the globalists, they love their wars to open up new markets. Just look at what countries the globalists declare to be our enemies, they are the ones who put some restrictions on the globalists system, look at the friends of globalists, communist china, communist Vietnam the Gulf states which fund much of the terrorism in the world. Clinton, Bush, Obama, Blair etc love their wars and they are all on the open borders side.

As to the rambling after demography, I have no idea what point you are trying to make. Are we suppose to get rid of cotton picking machines because we won't have enough bodies to fight our never ending wars to make the world safe for globalism?

There is nothing preventing investment in cheap clean energy sources now, other than that they aren't as inexpensive or efficient as the energy sources we have now.
There is no reason to think they will suddenly become more efficient or cheap if we suddenly ban their competition.

"There is no reason to think they will suddenly become more efficient or cheap if we suddenly ban their competition."
If scarcity of workers makes automation boom, then obviously scarcity of energy will make clean energy boom. I don't know, maybe it is different because there is no brown energy...
"Wars and conscription, that has been the globalists."
But WW II conscription made everyone richer by stimulating "labor saving" technology, you say. We need more wars, so every man will have his own army of robots.

"""But WW II conscription made everyone richer by stimulating “labor saving” technology, you say.""""

I don't say that, labor saving technology came after the war. War is very inefficient. War restricted new technology in farming due to shortages of new equipment. It was after the war that labor shortages along with a free economy stimuated people to put money into new farm tech to harvest cotton mechancially

WW2 conscription did not do much for labor saving technology. There were masses of semi skilled people put into war industry.

WW2 also did little for many technologies. The DC-3 was from before WW2 and had all the advances such as aluminum construction, monoplane, retractable wheels, efficient engines. WW2 aircraft were just variations of the DC-3 with over powered engines. Engines that proved to be uneconomical for post war peace time service.

Shipping was even worse, the mass produced designs of merchant ships were old fashioned even when built. And after the war the

Car design was held back by government order while truck design was mostly in 4 or 6 wheel designs that had little value for civilian use

"We should ban oil and electricity, then we will invent a really cheap, clean energy source"
This kinda is the policy already (for oil at least). You'll never get solar energy if the ppb is too low.

We must to get rid of those pesky workers so we can have our robot utopia at last. Send them to Iran. Or China.

As a cotton farmer in the Southeast, I can tell you you're full of shit. I don't use pickers that cost $750,000 - $1,000,000 apiece because there's not labor available, it's because that labor will not show up to work when it's easier to sit at home and collect 'benefits'. I don't even think it's a wage level issue.

Did you bother reading what you wrote. First you say that there is no labor available and then you say that there is no labor available to pick cotton by hand.

I am sure you would have been one of the farmers in the 1950's complaining about having to buy a expensive picker because those dam darkies won't show up and pick your cotton while singing 'swing low, sweet chariot'

If the cheap labor had been available you would never have bought a cotton picker and today the US would still be hand picking cotton today. You make my point, thank you very much. With low per worker productivity there would be low wages, and demands that the US import cheap labor to keep the business that depend on poverty.

There's labor available, it just costs more than machinery.

Net nothing. Mexicans have higher rates of social pathology and lower mean IQ than majority whites. Also, like the African slaves, automation is rendering their labor unmarketable.

"Also, like the African slaves, automation is rendering their labor unmarketable."
Tell it to President Jefferson Davis. His follower thought it to be pretty marketable. Or are you saying we can't have African slaves now because automation is rendering their work unmarketable?

It's pretty obvious that slaves were replaced by employees who were paid what it formerly cost to clothe, house and feed them. We have now replaced the employees with mechanical harvesters.

It's funny how libertarians who drool over self-driving cars, 3D-presses and other gizmos think no work could get done without a stout team of darkies.

TAG,

Immigration produces a superabundance of hypocrisy. The same folks who treat "free trade" as a holy gospel and defend outsourcing as a godly mandate, suddenly become fanatical protectionists when anyone suggests that the U.S. might import tomatoes rather then grow them will high-cost (to taxpayers) illegals.

Losing millions and millions of well paid jobs in the Midwest is an unvarnished benefit. Let the job of some illegal in California be threatened and we have an impending national catastrophe.

In the short term, horrible delays at every major airport.

We'd have less farm laborers so we'd starve, just like what's happening in countries like Japan or Germany.

But other than that it would be great. We'd lose part of our fast food workforce, might lead to us eating healthier food. Less construction workers, but you wouldn't need construction workers because they'd leave all their property, causing real estate prices to decline. And there'd be less traffic on the freeways.

All,

I have spent quite a bit of time in countries with less unskilled labor (iceland, Switzerland, etc.). It was terrible.

You generally have to bag your own groceries. We need Open Borders to save us from the pain, the sorrow, the nightmare, the trauma. It was somewhat like a microagression... That never ends.

Exactly, God forbid I'd have to mow my own lawn.

What happened to the British economy after the Black Death?

Wages for laborers went up, and so did their power vs. the landlords.

Eventually, things got much better, didn't they?

Bring outcha dead! Bring outcha dead!

The capital/labor ratio improved markedly with a decline in the labor force, not to mention the land/peasant ratio.

The problem in primitive societies is that agricultural surpluses are used to grow the population, leading to more hunger.

If we can grow the food supply without growing the population. everyone can be fat and happy.

Similarly, if we can grow the productivity of our machines without increasing the population, we can all sit back and enjoy the benefits. Why spoil that by forcing us to share the pie with more people?

Some 9% of the population of Mexico is in the US. Mexico's managing just fine without them. Even benefiting from the remittances they send and the loss of the poorest and likely most disruptive of its population. Now, why would you think that the US would have a hard time giving up "Mexicans" who are MUCH SMALLER portion of its workforce, who work illegally, and who mainly do unskilled jobs that can be done by literally anyone?

AA,

"Some 9% of the population of Mexico is in the US. Mexico’s managing just fine without them."

Not true. Plantation operators in Mexico complain bitterly about how lazy Mexicans and how they won't work on farms. As a consequence, they "have" to import illegal labor from Central America.

That's utterly crazy and repugnant. It also shows that the mindset of the exploiter doesn't stop at the Rio Grande.

There would be some inflation as higher labor costs percolate their way up through the economy. The higher wages at the bottom would attract more people, who are not in the workforce but are able to work, into the workforce.

I think the people here would be slightly better off and the Mexicans who return to their country would be much worse off.

Eisenhower enacted Operation Wetback in 1954, with 1 million Mexicans being deported (at a 10:1 ratio of self-deportation to forcible deportation). The economy came out of a recession and grew strongly for the next 36 months t (3.5% annualized).

But short-term effects aren't really that important. The main point of shutting off Central American immigration is to boost our standard of living in the long-term by maintaining strong human capital.

There will be some short period of adjustment to the lack of cheap labor. Tyler might get apoplectic. But in the end, the society will benefit because enormous number of net tax burdens disappear.

One thing that would happen is more automation, which will be happening anyway due to the forced imposition of increased minimum wages which make unskilled workers unprofitable to hire.

The traditional sectors of youth employment have to start hiring young Americans again.

Massive improvement?

Except for a few small exceptions generally yes.

1st The rentier class, especially property owners in places like California would be hit hard. Figure about 40% of the population of California is Hispanic. This means around 1/3 of housing stock would be unoccupied. Heck Santa Ana which is in a choice location would lose 80% of its population. However in time much of this prime real estate would be reoccupied probably by new owners instead of renters. Or in some cases renters at a lower rate. Its possible that clumsy state intervention may end up keeping stocks artificially low but that with such numbers end up being a huge social/fire/crime hazard and creating more capital flight

This will not increase population though, only shift it around. In time White populations will grow though since fertility will probably increase with less opportunity for wage arbitrage

2nd Home builders for obvious reasons

3rd Public Schools. This will be hit hard. I live in a mostly Hispanic area and loss of 90% of that population would leave the schools mostly looking like Compton in the 80's. White kids here and this is a highly natal area mostly attend magnet schools (technically public) or parochial schools and they won't be going back . Essentially school will shrink, turn blacker and have all manner of related issues

4th Anyone selling to the Latino crowd, child care supplies and so on.

Another winner will be Blacks whose political power will increase without a Hispanic buffer

Almost everyone else will do well too.

Too easy.

Lets also assume 90% of Latinos as a group went away shall we.

Any state or city with a heavy Latino population would suffer from labor shortages, agriculture in particular would have 3-5 bad years.

There would be food price inflation and more emphasis on imports.

The exact rate of long term price inflation would depend on how much of a given crops cost was labor and what the difference between what wages workers will ask for in the new market and what they are currently.

According to the USDA, its between 17 and 40% of a crops costs. So its easy to calculate.

This increase could easily be managed by a small increase in SNAP and by the market as people adjust what they eat to what is available, Its not to different than dealing with this years poor lemon crop

Also such an outcome would spur research into agricultural automation and an interest in gardening.

As for other industries, assuming they weren't able to replaced with another immigrant group, wages among the lower echelon of society would rise.

This would benefit mostly Black and Lower income Whites though some trickle up would be assumed.

My guess is that wages would go up about 33% overall with food going up by about 50%

This would end up with adjusted a 25% increase in an average workers standard of living with the extra wages offset by slightly higher prices for some foodstuffs.

In truth there is no downside to mass deportation from a workers POV.

Nope, the bigger issue is that the type of welfare that discourages work is what the natives get and the immigrants don't. If the immigrants leave, the natives just keep not filling those jobs. Do you really think Americans aren't picking fruit in the vineyards because of Mexican competition? Please. The wages would have to be so high for Americans to do that work that the industry would no longer be profitable.

But, but think of all the robots that would be invented! Everybody would be richer!

On an unrelated note, we should break all the windows. Someone will finally have an incentive to invent force fields to replace them!

Mechanical grape harvesting already exists. Check YouTube.

aM,

Farmers will either mechanize, pay natives enough to get them to work (a tragic thought), or switch to higher productivity crops. Remember, that immigrant labor is taxpayer funded welfare labor. In other words, a scheme where the plantation plutocracy profits and the American people get screwed. We tried this before. The results were not positive

Of course, slavery had its fans back then. Apparently, it still does..

Oh yes. I recall now. The plantation owners offered wages that were too low for most Americans, so Africans just started immigrated here to fill in the demand. That's how it went, right?

Sarcasm aside, you really can't compare immigrants who move here to slaves. Sorry. If people are immigrating here, it's because they believe the outcomes for them here will be better than they were in their previous situation. That's a completely different thing than slavery.

Your stronger argument would be that their low wages are funded by taxpayers. But is that true? I thought a lot of studies showed that they end up paying more into the system, partly because they don't qualify for so many of the benefits.

As he mentioned above and I mentioned below, their entire tax payments in their lives will not cover the costs of their kids making it to 18.

aM,

The parallels between slavery and cheap labor immigration are rather strong. Of course, there are also differences. Sadly, human society has been cursed by the desire of the overclass, to import some species of helots, for thousands of years. it is a tragic recurring theme of history. The desire to have "the other" available to do the dirty work is nothing new. The adverse consequences of importing "the other" are ancient as well.

I could lament the failing of the Antebellum South forever in this context. However, let me quote from a well known northern immigration advocate from the post-Civil War period who wrote about

"the wretched quality of work performed by the vast majority of American mechanics and domestic servants." and the
"false sense of pride that revolted at the very name of servant, as derogatory to the freeborn American".

When she (Emma Lazarus) wrote these words, American mechanics were already world renown for their excellence. Of course, Emma did have well developed sense of entitlement when it came to cheap servants (typical of her class at the time).

A few years (decades) later an American labor leader (Samuel Gompers) offered the following observations.

"America must not be overwhelmed.

"Every effort to enact immigration legislation must expect to meet a number of hostile forces and, in particular, two hostile forces of considerable strength.

"One of these is composed of corporation employers who desire to employ physical strength (broad backs) at the lowest possible wage and who prefer a rapidly revolving labor supply at low wages to a regular supply of American wage earners at fair wages.

"The other is composed of racial roups in the United States who oppose all restrictive legislation because they want the doors left open for an influx of their countrymen regardless of the menace to the people of their adopted country.'

Now we have same alliance of racial special interest groups and corporate exploiters that Gompers denounced almost a century ago.

David Brooks made some similar points a few years ago.

"They congregate in exclusive communities walled in by the invisible fence of real estate prices, then congratulate themselves for sending their children to public schools. They parade their enlightened racial attitudes by supporting immigration policies that guarantee inexpensive lawn care."

aM,

"Your stronger argument would be that their low wages are funded by taxpayers. But is that true? I thought a lot of studies showed that they end up paying more into the system, partly because they don’t qualify for so many of the benefits"

Two easy points. Some illegals (young, male, non-criminal, no family, etc.) probably do pay more into the system than they take out. However, using that claim to justify Amnesty (which is almost always the context) is absurd, because Amnesty opens up the floodgates of taxpayer handouts. Notably, Friedman specially said that illegal immigration was good as long it remained illegal.

I (strongly) reject this argument on moral grounds (the economic logic is fine).

The second points is that most illegals and essentially all legal low-skill immigrants are costly burden (even without considering displacement effects). This is an empirical points.

From a prior post

"“But how much of the research indicates that low skilled immigrants including their families that have full access to all entitlements are a net positive?”

This has been studied many times around the world. Of course, imported poor people are drain. From Borjas

“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.”

Profitable for corporate exploiters though, particularly the agricultural sector.

A few more references.

http://www.econbrowser.com/archives/2010/10/guest_contribut_9.html “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.”

From “Immigration and the Dutch Economy” http://www.cpb.nl/node/10221

“For all entry ages, however, immigrants turn out to be a burden to the public budget if their social and economic characteristics correspond to those of the present average non-Western resident. Accordingly, budget balances are affected negatively.”

From “Immigration to the Welfare State. Is it a Burden or a Contribution? The Case of Sweden” http://www.amid.dk/pub/papers/AMID_48-2006_Jan_Ekberg.pdf

“Nowadays, there is a negative income effect for natives, i.e. immigrants contribute less to the tax system compared to what they receive from the public sector. At present, the yearly negative income effect is nearly 2 percent of the gross national product (see Ekberg 1999), i.e. approximately SEK 30-40 billions.”

The same study showed negative fiscal impacts in several other countries as well."

Here is a new U.S. study "Welfare Use by Immigrant and Native Households" (http://cis.org/Welfare-Use-Immigrant-Native-Households)

"Welfare use varies among immigrant groups. Households headed by immigrants from Central America and Mexico (73 percent), the Caribbean (51 percent), and Africa (48 percent) have the highest overall welfare use. Those from East Asia (32 percent), Europe (26 percent), and South Asia (17 percent) have the lowest. "

"The plantation owners offered wages that were too low for most Americans, so Africans just started immigrated here to fill in the demand. That’s how it went, right?"

Pretty much, actually. Obviously the immigration wasn't voluntary, but they were a product being supplied to plantation owners who refused to pay market rates to non slaves.

aM,

"If the immigrants leave, the natives just keep not filling those jobs"

A few years, the Feds raided a few meat packing plants and ousted the illegals. Americans (of all races) lined up for blocks to get the jobs. Jobs, that supposedly "Americans won't do".

From "save_the_rustbelt"

"Applicants line up to fill jobs left empty by Swift plant raid
"By Fernando Quintero, Rocky Mountain News December 15, 2006

GREELEY - The line of applicants hoping to fill jobs vacated by undocumented workers taken away by immigration agents at the Swift & Co. meat-processing plant earlier this week was out the door Thursday.

Among them was Derrick Stegall, who carefully filled out paperwork he hoped would get him an interview and eventually land him a job as a slaughterer. Two of his friends had been taken away by Immigration and Customs Enforcement agents and he felt compelled to fill their rubber boots."

and a prior post of mine

"The parts of the United States with few immigrants prove this point. From Barry Cheswick in “The Worker Next Door”

“Yet even in areas with few immigrants, grass is cut, groceries are bagged and hotel sheets are changed.”

From “The Nation: A New Order; Imagining Life Without Illegal Immigrants” by George Borjas

“But while the disruption would be real, Professor Borjas argues, it would not be long lasting. As proof, he says, look no further than places like Iowa, where foreign-born residents are relatively rare, but there are people working in hotels, fast-food restaurants and all the rest.”

“”The workers would be slightly wealthier and the employers would be slightly poorer, but everything would get done,” said Professor Borjas, who used to live in California. ”I moved to Boston and the lawn is still green.””

Some countries, notably Canada, Finland, and Australia do a better job of keeping low-skill immigrants out. The lawns are just as green and the local versions of Another Cluadia can actually get a job."

It is not a newspper, it is a magazine.

*not a newspaper, it is a magazine.

So welfare is an investment? Who knew?

Even conceding your point on Social Security (though in reality the vast majority of low-skilled immigrants will get back more than they pay in) lower-skilled immigrants will consume more in resources than they pay in taxes. Most will pay no income taxes, and will receive EITC. So the cost of K-12 does not pay for itself. In this country, you've got to pay an _awful_ lot in taxes to begin to pay for yourself and your family.

I gotta say, it sure doesn't sound like Masonomics!

...yes it's really an odd endorsement of the Welfare State, considering the source.

And the alleged evidence presented in support of that strong welfare endorsement is pitiful, really weak junior high school stuff.
(is it more coherent in Portugese?)

U.S. spends a Trillion $$$ per year on welfare programs. There are over 125 separate Federal programs alone.. But overall official poverty levels are about the same as the 1960s. Welfare State is colossal failure.

It sounds better in Portuguese, everything does.

Arne,

"…yes it’s really an odd endorsement of the Welfare State, considering the source"

Not really. TC and AT are Open Borders zealots first, foremost, and always. Anything can be sacrificed (including the truth) on the altar of Open Borders.

Same problem in the UK; a family has to be the 7th decile before it starts to pay back in tax what it takes in welfare and social expenditure. How many of these immigrants are 7th decile workers?

Yeah. Thought so. Not to mention those small negative "externalities" in housing, education, and head chopping.

About a half decade ago, Los Angeles opened a new school building on the site of the hotel where Robert F. Kennedy was murdered in 1968, the Robert F. Kennedy Schools. This one building and its property cost $578 million. It's going to be a long, long time before the students at that school pay off that $578 million capital investment, not to mention the annual operating costs.

California has rich people problems, in and out of government. You can buy a house here for $150 million, "not to mention the annual operating costs."

But California also has a lot of poor people problems because it has a lot of poor people, a large fraction of them illegal aliens.

Your framework depends on "California is the worst," but in fact it is high GDP and growing faster in GDP than most states. Texas, another highly and historically Hispanic state is doing great as well.

Your message depends on a false view of reality. So much so that the insular, low immigration, states which should be your Nirvana are doing the worst in absolute terms.

You have to be a particular kind of person to look at US states with Spanish language names, be shocked at their history, and blind to their success.

BTW, I was behind the times: "One of the biggest homes in U.S. history is rising on a Los Angeles hilltop, and the developer hopes to sell it for a record $500 million."

“One of the biggest homes in U.S. history is rising on a Los Angeles hilltop, and the developer hopes to sell it for a record $500 million.”

Hidalgo culture.

BTW, one of the richest men in the world lives in Mexico, Mexico has abundant, cheap calories and a lively culture, but one would think Mexico is this prison where white racists keep all the destitute Mexicans locked up.

Well, John. It is also fair to assume that the causation relationship might go the other way: people immigrate to place that are growing.

Sure Peldrigal, people have been immigrating to California since the last ice age. Waves were native American, then Spanish, then American, and lots of others. There was fair continuity between those waves, more than most places. The Treaty of Guadalupe Hidalgo provided that the Mexican land grants would be honored. I had a friend who looked Irish, but was a Yorba. His family owned a good chunk of southern California, selling it off over the years. My friend had to work for a living.

It worked out great. Compare that to ... what would Steve's Ideal be? Idaho? Why isn't Idaho kicking everyone's butt economically?

BTW, if that $500 million house sells, it will probably be to someone like Vinod Khosla, who is still getting used to our ways (and beach access rules).

You know, John, economists have a concept called "opportunity cost." They don't apply to it immigration policy, but it could profitably be applied to California.

Is that the best you've got? A sudden twist to a vague claim?

Of course it is. We see the nature of a sick mind. Never mind the facts, the robust economy, when all facts have been examined declare a benefit off-camera, that no one can see.

"Your message depends on a false view of reality. So much so that the insular, low immigration, states which should be your Nirvana are doing the worst in absolute terms."

Doing the worst in what way John? Low rates of HIV, teen pregnancy, high school dropouts, and homicide?

John,

Adjusted for the local cost of living, California is one of the poorer states. California is also #1 in poverty and has (almost) the worst schools in the U.S. If California is an immigrant "success" story, that's a rather strong argument for closed borders.

See "Census Bureau: California still has highest U.S. poverty rate" (http://www.sacbee.com/news/politics-government/capitol-alert/article2916749.html) for a typical article.

Did I mention that California is a real leader in inequality? I guess that just another success story for you.

"Did I mention that California is a real leader in inequality? I guess that just another success story for you."

Yeah, and all those people are forced to live in poverty because of the walls and strict migration policies of the rest of the American States which deny any resident of California any right to be an economic migrant.

Those Texans have built a really high wall with Texas Rangers on patrol to keep out economic migrants from California, because after all, California is really just Mexico and Texas broke from Mexico to win independence.

I realize John can't grasp the relevance of the concept of opportunity cost, but then most economists suffer crimestop when it comes immigration and opportunity cost. California doesn't have to be "the worst" state in the Union under massive immigration, it just has to be worse for Americans than what it could be: Opportunity Cost.

California was long the finest place to live for the average American. Now it's the finest place to live for Mark Zuckerberg.

mulp,

In real life, Americans are leaving California. Indeed, California is losing both legal and illegal immigrants to other states. Of course, as long as life in LA is better than Guatemala (by way of example), the state population will keep growing. To get a real sense of what life in California is like for ordinary folks, take a look at the stunning article the LA. Times wrote on this subject.

The title was “6 + 4 = 1 Tenuous Existence” (http://www.latimes.com/news/printedition/la-me-quadruplets28jul28,0,4751217.story?). Read the article by all means. However, the family tragedy isn’t the real story. Take a look at the quotes about how Open Borders has wrecked California and why even illegal aliens are getting out and (in this case) moving to Kentucky.

“What we weren't able to do in many years in California," Alejandra said, "we've done quickly here”. That includes having a place to live.

“We're in a state where there's nothing but Americans. The police control the streets. It's clean, no gangs. California now resembles Mexico — everyone thinks like in Mexico. California's broken.”

"Her sister Alejandra was the first to leave. In Los Angeles, she and her husband were barely able to make ends meet. As in Mexico, "there was little work and it's poorly paid," she said."

"Eight years ago, she and her family moved to Kentucky, where a friend said there was more work and were fewer Mexican immigrants bidding down the wages for unskilled jobs."

"at the school there are just people who speak English. It's helped my children a lot."

If poor illegal aliens working in California can recognize the horrific consequence of mass migration, why are so many of our elites blind to the nightmare staring at them? Could greed have something to do with it? Mind numbing political correctness? Could crass “I see the world through brown eyes” racism be responsible?

If illegals can recognize that Open Borders has "broken" California, perhaps you reach a comparable level of enlightenment.

"Of course, as long as life in LA is better than Guatemala (by way of example), the state population will keep growing."

That's it. And, ironically, "average is *not* over;"; with open borders it is only beginning.

Seems an economist ought to be able to crunch the numbers on this.

Immigrant child goes to school for 13 or 14 years (pre-k, kindergarten, grades 1-12). National median per-pupil spending is ~$12k per year. $12k x 13 years is $156k. Let's say he makes $42k when he graduates (unlikely, but this is about the median wage), has one exemption, and puts away $5k per year in a qualified retirement plan. This tax calculator says his federal income tax liability would be less than $3k per year.

Granted: most k-12 ed spending comes from state and local taxes, not federal, but chances are he's going to be paying less in state and local taxes than he pays in federal taxes, and his federal income taxes over a 40 year career would be ~$120k - less than his $156k education "loan".

Wow,

"Social Security for example is mostly a forced savings program"

If an Econ 101 student wrote something that poor, they would get an F. However, Open Borders propaganda is not required to have any bearing on the truth. Social Security is not a "forced savings program". It is a PAYGO system where current Social Security taxes pay current Social Security benefits. Singapore has a genuine forced savings program for retirement. The U.S. does not. Claiming that it does may impress low information readers in Brazil (how many Brazilians are expects on U.S. retirement programs?). However, it the U.S. it won't fly because it's just not true.

Social Security does have an eligibility and benefit mechanism that restricts payouts (to some limited degree) in accordance to what a person has paid in. However, the linkage is weak and exceptions ("disability") abound. In absolutely no sense is it a "forced savings" program. The even larger point is that Social Security is designed to be very progressive. Low income workers get far more out of the system than they put in. That means that low-skill immigrants are a disaster for Social Security.

From a prior post

"Low-skill immigrant households are extremely expensive tax consumers. The tax costs of low-skill immigration alone, make it a terribly bad deal for Americans. Everyone who looks at the numbers, for even a few minutes knows this. From Heritage

““In 2010, the average unlawful immigrant household received around $24,721 in government benefits and services while paying some $10,334 in taxes. This generated an average annual fiscal deficit (benefits received minus taxes paid) of around $14,387 per household. This cost had to be borne by U.S. taxpayers. Amnesty would provide unlawful households with access to over 80 means-tested welfare programs, Obamacare, Social Security, and Medicare. The fiscal deficit for each household would soar.

At the end of the interim period (after the Amnesty is complete), unlawful immigrants would become eligible for means-tested welfare and medical subsidies under Obamacare. Average benefits would rise to $43,900 per household; tax payments would remain around $16,000; the average fiscal deficit (benefits minus taxes) would be about $28,000 per household.""

Like it or not claiming that low-skill immigrants and the welfare state play nice is about as far removed from the truth as you can get. Statements like this make Donald Trump look like a model of rigorous intellectual integrity (which compared to the Open Borders crowd, he is).

Social Security has collected trillions more in taxes than it has paid in benefits over the past couple decades.

Ignoring this basically accepts that for several decades, we have relied on a regressive payroll tax to fund a substantial portion of ongoing operations of the US government.

Which is a position one can take, but it makes the overall US tax structure between 1982 and 2008 a lot less progressive than Republicans claim.

SS tax payers =/= income tax payers.

"Ignoring this basically accepts that for several decades, we have relied on a regressive payroll tax to fund a substantial portion of ongoing operations of the US government. "

That's what's usually referred to as a fact. I'm not sure why you would preface it with "ignoring this".

"Which is a position one can take, but it makes the overall US tax structure between 1982 and 2008 a lot less progressive than Republicans claim."

I'm not sure how this is particularly relevant. Most Republicans are referring either to net Federal taxes or specifically Federal Income taxes, both of which are still progressive.

If you accept my second sentence (which it appears you do), then it is dishonest to ignore Social Security taxes as part of the overall analysis of tax progressivity.

"then it is dishonest to ignore Social Security taxes as part of the overall analysis of tax progressivity."

Yes, but then I did use the phrase, net Federal taxes. Obviously net Federal taxes would include both FICA and Income Taxes. The net is distinctly Progressive.

BD,

As you point out, the Social Security trust fund has long since been spent. However, even if it hadn't been spent, the numbers and conclusions would be the same. The Trust Fund would cover roughly 3 years of spending at present. A real "forced savings" system would have enough money for decades. Note that private, state, and local pension system are required to have enough money for decades (and are considered to be unfunded if they don't). Calling Social Security a "forced savings" system is overtly dishonest at several levels. The size of the Trust Fund is only one. The overt lack of individual accounts (you know, with money in them) and the sharply progressive nature of the system are two other material points.

Calling Social Security a "forced savings" program is just a way of (dishonestly) avoiding the harsh fact that low-skill immigrants are massive burden on the welfare state and Social Security is just another example. In real life, health care and education are even bigger problems.

No. Social Security is close to 'actuarially sound', including current trust fund assets. 'Fixing' Social Security is child's play compared to other budget issues:

http://www.actuary.org/content/play-social-security-game

Policymakers saved Social Security in the 1970s -- accumulating a significant reserve was largely due to Baby Boomer demographics. Over the longer-term, the system was always expected to revert to something like a PAYGO system.

The fact that the trillions in reserves were spent on other stuff is not the fault of Social Security.

I think we can all trust that Alex knows exactly what SS is but, for the purposes of benefits, illegals pay in (or their employers do, at least) and are ineligible to receive. Social Security is forced savings with a grossly negative return, in that sense.

Mike D,

"I think we can all trust that Alex knows exactly what SS is but, for the purposes of benefits, illegals pay in (or their employers do, at least) and are ineligible to receive. Social Security is forced savings with a grossly negative return, in that sense."

I wouldn't assume that at all. People who know how something works, generally try to describe it honestly. You can reach your own conclusions about the role of mendacity vs. ignorance at work here.

However, the notion that illegals pay into Social Security, but won't benefit has three rather big problems. First, via the EITC illegals have (in many cases) stopped paying in. Second, they only way they can be prevented from collecting is by keeping them illegal. Does Alex favor that? Clearly not (Friedman did by the way). Third, the use of the "forced savings" phrase is a deliberate reference to a system where people pay in (involuntarily) and then later collect. Collecting Social Security taxes from people who will never receive any benefits would not be called a "forced savings" system.

"Social Security is not a “forced savings program”. It is a PAYGO system where current Social Security taxes pay current Social Security benefits."

Just like home property and liability is PAYGO and auto property and liability is PAYGO.

And lots of people pay a lot more into these PAYGO systems so the other collect more.

Half the people paid benefits from Social Security are not paid for their own insurance policy, but as beneficiaries of the workers who died, or got disabled, or got too old so they were unable to support dependents.

(That does not mean many of those getting benefits never paid FICA taxes, or never will - Paul Ryan was a Social Security beneficiary because his primary financial supporter, his father, died. He has since paid in most years the maximum FICA tax so that other children who were less lucky than his bad luck to have his father die when he was 16 get benefits from ages to 2 until 18 or 5 until 18 when their father dies young.)

There is no way a savings program can provide the benefits for half of those getting Social Security benefits.

mulp,

"Just like home property and liability is PAYGO and auto property and liability is PAYGO"

Basically, yes. Technically (very technically) no. Insurance companies are required to invest the premiums they collect in one year to cover claims over a period of years. With the partial exception of Medical Malpractice insurance, where the number of years is material, the time horizons for most insurance are so low that the substantive answer is yes. Note that life insurance is a big exception (the number of year is almost always material). Life insurance (even term insurance) is not PAYGO.

"And lots of people pay a lot more into these PAYGO systems so the other collect more"

I think you meant "so the others collect more". Assuming my reading is correct, yes again.

"Half the people paid benefits from Social Security are not paid for their own insurance policy, but as beneficiaries of the workers who died, or got disabled, or got too old so they were unable to support dependents."

I don't if your numbers are correct or not. However, they sound plausible. About what you would expect for a PAYGO system.

"There is no way a savings program can provide the benefits for half of those getting Social Security benefits"

This could probably be disputed. However, that's not my intent here. You are (presumably correctly) describing how Social Security actually works. Alex is playing on the ignorance of Brazilians with a Pinocchio story ("forced savings") that bears little resemblance to reality.

That's even assuming that providing a K-12 education for illegal aliens, especially Hispanics, will produce productive workers. Hispanics have the highest drop rates for both HS and college (if they even go to college) and the most children living in poverty. School alone does NOT make up for the lack of educated, involved parents.

I would argue that on the margin, being an illegal immigrant (vice someone with legal status and not subject to deportation) makes one less likely to show up at a parent-teacher conference or PTA meetings.

m,

"I would argue that on the margin, being an illegal immigrant (vice someone with legal status and not subject to deportation) makes one less likely to show up at a parent-teacher conference or PTA meetings"

Maybe, but not relevant. From a prior post.

"Immigrant underperformance in American society is well established. Indeed, we have a wealth of information that the deficits in question are multigenerational out to the 4/5th generation. Ultimately, it doesn’t matter if the deficits are genetic, social, or cultural as long as they persist. So far they are persisting. There are number of sources to support this statement, mostly from Hispanic analysts. See “Honesty from the Left on Hispanic Immigration – A provocative new book doesn’t flinch from delivering the bad news”. The authors cited by Heather MacDonald are Patricia Gandara and Frances Contreras.

Telles and Ortiz have made much the same argument. The following is from a letter they wrote to the New York Times.

“In our book “Generations of Exclusion,” we show that the descendants of Mexicans do not experience the steady progress into the third and fourth generations that has been documented for those of European ancestry.”

Samuel Huntington wrote an article in Foreign Affairs, “The Hispanic Challenge” showing academic underperformance out to the 4th generation. Note this his data shows significant declines in academic performance from the 3rd to the 4th generation."

As you can see, legal status is not even a material issue in this context. We have (of late) another data point that is somewhat germane. It turns out the Puerto Rico has (by far) the worst schools in the U.S. (vastly worse than Mississippi).

From a prior post.

Check the NAEP statistics for Puerto Rico. They are far lower than any American state. A few quotes may help here. From

“On NAEP, Puerto Rican students lag far behind other U.S. kids” (http://ny.chalkbeat.org/2008/12/15/on-naep-puerto-rican-students-lag-far-behind-other-us-kids/)

“According to Education Week, Puerto Rican students have performed far worse than students in the nation as a whole on the math component of the National Assessment of Educational Progress, a test used to compare student performance across states. (The test, translated into Spanish, has been given in Puerto Rico since 2003. Puerto Rican students don’t take NAEP’s reading section.)”

“Virtually no students in Puerto Rican schools scored at the Proficient or Advanced levels on the test 2005. And while the 2007 scores were reported in a different format, they also show a wide gap between students in Puerto Rico and the rest of the country.”

“Puerto Rico Falls ‘Below Basic’ on Math NAEP” (http://www.edweek.org/ew/articles/2007/04/04/31naep.h26.html)

“Long-awaited results on how Puerto Rico’s students fared on the National Assessment of Educational Progress in math are finally in—and they’re not good.

Only 12 percent of 4th graders and 6 percent of 8th graders in public schools scored at or above the “basic” level on “the nation’s report card” in 2005. So few students scored at the “proficient” or “advanced” level that the percentages rounded to zero.”

However, some folks in Puerto Rico do have a plan for solving this problem. They want to ban the NAEP. I have a better solution. Independence. ¡¡¡¡¡¡Vive Puerto Rico Libre!!!!

Seriously, I do favor independence. However, the U.S. should make every effort to aide the newly independent nation. For example, we could impose import tariffs on labor intensive goods and exempt Puerto Rico.

For fun read http://pennance.us/puerto-rico-naep-results/.

Oh and nice job trolling the American taxpayer in a Brazilian newpaper.

It is not a newspaper.

You're my favourite for the Nobel Prize in Economics 2016

"or only available after five years or some such time period"

What a great idea. Every pakistani that moves to the US and can support himself for five years, should then have the right to benefits and healtcare. What could go wrong.

Here's another question; even if you believe that most of "wellfare society" is actually based on "insurance programs", what do you think would happen when millions of poor africans, pakistanis, arabs have moved here and then they suddenly cant find a job and haven't paid the insurance. Do you really believe this society would be more libertarian in the long run or do you think a lot of people would be in favour of more europeansstyle wellfare states. You know, when the streets are full of young unemployed and hungry somalians.

Ohh, sorry I forgot. Once the Open Borders are there, society will turn into a magic state of economic progress and harmony.

Find me ONE person who has held a job for five years that would be satisfied on paltry welfare.

It is a rare person who prefers small handouts to a job.

1) It is not always a choice between "nice job" and "paltry welfare" - try ask some uemployed people?
2) You cant assume they had a job in the first place. Maybe their family just paid for their living costs?
3) Even if they had a job, they might want to hand it over to their cousin, and then themselves get the paltry welfare. From a family perspective thats a lot better than the welfare you can get back home in Somalia. And yes, family matters for a lot of people.

Um, huge swaths of the people on SSDI are people who worked for many years... but now effectively prefer welfare.

NW,

The U.S. has 14 million people collecting disability. That number has soared in recent decades even as the number of dangerous jobs has plunged (and even dangerous jobs are now much safer). Male LFP (Labor Force Participation) has plunged by astounding percentages over the last 30 years ago. Like it or not, vast number of people are now living off of the system rather than working.

However, the deeper point is that even immigrants who work are still a shocking burden on society. Take look at the number above. A typical low-skill immigrant household (with workers) consumes more handouts (net) that it earns. In other words, the difference between handouts consumed and taxes paid (the net cost) exceeds all of the earnings of the household.

I think you underestimate the value of leisure time, especially nowadays.

I think you overestimate the value of unlimited leisure time.

Prediction: Virtual Reality becomes better and cheaper, and the content ever more compelling.

10+ billion people with <20 average work hours per week and constant VR entertainment are possible this century.

Once the Occulus Rift comes out all bets are off

Time is the one thing that is limited.

The fact that you use the word "unlimited" in regards to one's time is priceless.

Pardon my French Harun, but you're an idiot if you don't know what I mean.

But what of your children having the right to life long Social Security benefits if you wreck the car on their way home from the hospital and kill yourself and make them disabled and unable to support themselves?

Don't you think US citizens should be euthanized if they fail to earn enough to support themselves or have the luck of someone to happily give them charity? Like perhaps your parents did, assuming they paid high taxes in excess of the taxpayer funded benefits you got like schooling, the benefits of socialized vaccinations, ....

I'm old enough to remember polio. Vaguely. I remember classmates who were crippled by polio, but thanks to socialism, I never see them around. Nor are taxpayers paying to keep them alive.

"because the schooling leads to higher wages later in life which are taxed. In these cases, the immigrant children are really just receiving a loan which they will have to pay back from their own earnings later in life. "

You could have a great career in the financial industry.

So why do parents have to pay taxes for the educational system even before their child is born? Wouldn't fairness require that they, too, like illegal immigrants, pay no such taxes until junior shows up at the school for first grade?

I'd also like to point out that social security redistributes income. The better off pay in more and receive less in return than others. It's not just "forced savings."

stubbs,

AT is playing off of the ignorance of Brazilians (how many Brazilians study American retirement programs?) and the Open Borders crowd in the U.S. Of course, Social Security isn't a "forced savings" program. However, part of being an Open Borders advocate is that you are not bound by the truth. You can get away with saying things that are laughably untrue because the sympathetic media won't challenge you. As a consequence, Donald Trump is a model of intellectual integrity compared with AT. That may not be saying much. It's still true.

That was a silly post. You cannot have redistribution and open borders. The proof is trivial.
Claiming that Social Security is not redistribution may be accurate; it may be coercive savings, just like estimated taxes and
withholding. Then it doesn't really fit the description of welfare. However, other programs, no matter how limited, can be
gamed by a selection bias, if nothing else. Open borders allow people out as well as in.

Social Security incorporates some redistribution. No way around it.

But only incidentally, in the same way any insurance redistributes from the lucky to the unlucky. In the case of SS, its more like an annuity, so the ones who die early distribute to the ones who live long lives.

The Supreme Court ruled back in the 1930's that Social Security is not and cannot be a forced annuity or insurance of any kind. Congress is authorized to tax but can't force people into contracts of any kind. As long as it is tax and spend, it is legal. Social Security can be repealed at any time. No one is entitled to anything ever. Go read the statement sent to you from the Social Security administration. It states point blank that you are not entitled to ever collect. It is just tax and spend. The fact that there are guidelines for payments based on previous earnings etc., doesn't mean those guidelines must remain the same. They can be removed, repealed, adjusted at any time. That is the only way the system can be legal.

What's Peter Schaeffer's estimate of the health care costs per worker per year? $12k?

A lot of the costs are special interests sticking the public with costs of labor, and not necessarily through the tax system. Privatize profits, socialize costs. If I'm a big grower in California's Central Valley and I attract, say, 50 new illegal aliens per year, I can stick everybody else with the cost of healthcare for them and their families, and public schools and prisons for their kids.

Much of the energy that Trump has tapped into is the growing awareness among voters of the multitudinous scams being put over on the average American in the name of sacred causes like Diversity and Immigration. Bernie Sanders is benefiting from a similar wising-up among Democrats.

Trump is nothing but an American Putin. A low intelligence appeal to appear strong.

John,

"Trump is nothing but an American Putin. A low intelligence appeal to appear strong"

You can say that. However, there is a lot more intellectual integrity in Trumps comments on immigration than AT's.

Yet when Walmart passes on the costs of health care to the public, libertarians are ok with it.

Yes. Employed people are preferable to unemployed

But if you import new people and hire them, you haven't reduced the size of your unemployed population.

Yet when Walmart passes on the costs of health care to the public, libertarians are ok with it.

You're assuming that it's an obligation of employers to provide health care, which is stealing a base.

"You’re assuming that it’s an obligation of employers to provide health care, which is stealing a base."

Well, in an important way it is, especially in libertarian(!) economics: like food, clothes, and shelter, basic healthcare is part of subsistence. Subsistence wages are the floor in economies without government redistribution to workers ("social welfare programs"). Since in an economy without Obamacare, etc. employers would have to pay for healthcare or have no workers, employers are "obliged" by impersonal economic forces to pay for healthcare.

Employers favor redistribution to privatize profits and socialize costs. In all cases employers pay some workers more than subsistence because of competition for workers with high human capital. With redistribution the government then taxes some of those wages away from high-wage workers and uses the money to subsidize low-human-capital workers so they will work for less-than-subsistence wages. An employer's profits increase because he pays high-wage workers the same as before and low-wage workers less.

(This is why employers and their shills love the EITC. Recipients MUST WORK for LOW WAGES to collect. If they remain idle, no EITC. If they increase their earnings, no EITC. It is better than a poverty trap, it's a menial-labor trap!)

"You’re assuming that it’s an obligation of employers to provide health care, which is stealing a base."

So, Art must believe healthcare is an obligation of the government.

I don't see Art calling for the poor and sick to be euthanized, or the disabled and unemployed to be euthanized, or the old and infirm to be euthanized in a manner consistent with free market creative destruction of useless capital assets.

Immigration is just more of that socialization of costs and privatized profits.

Have you considered the possibility that we protect the employment prospects and bargaining power of lower-tier workers via national borders, and then consumers pay welfare at the cash register instead of via government transfer payments?

The only welfare that is acceptable is monopoly profits created and protected by government.

Drill baby drill on public land at below market severance payments, but only for the big global monopolists, not the small upstarts competing with them by drilling on private land and taking a fraction of the profits set by the Cheney secret cabal.

After Cheney met in secret in 2001 with the fossil fuel industry monopolists, what direction did their monopoly profits go.

Since Obama, what direction have the monopolists of 2001 profits gone? What has happened to their monopolies?

Interesting all the automakers going to electric drive trains to deliver competitive performance in acceleration ending the fossil fuel monopoly on muscle cars.

If immigration has been branded as a positive good for existing Americans for economic or social reasons, then it is indeed a scam (I don't live in the US anymore, so I don't know what's being marketed to the public.)

I always thought immigration was about the benefits gained by immigrants and had relatively little to do with the host people (assuming there is no sudden mass influx; so the benefit gained by the newcomers is orders of magnitude higher than the loss, if any, suffered by natives.) But I guess your "citizenism" ideology does not have room for a moral calculus that takes the immigrants' well-being into account?

State officials are fiduciaries for their citizens, not for non-citizens.

Kris,

Immigration is (almost) always marketed to the American people as a benefit to them. It's not true. That's why such intense marketing is required (along with a bitter effort to suppress any contrary opinion).

That's all well and good, but the numbers I saw suggest that male illegal immigrants 25-54 in this country are more likely to be working than their native-born counterparts.

In the past year, I have heard several stories from rock-ribbed Republican small business owners - the lifeblood of the Republican party, not the plutocrats in the circles you focus on - who are having trouble keeping up with potential orders for want of labor.

And they never get old or sick or have children out of wedlock!

if they did they could be a Republican VP! no, wait. skin color matters.

This classism and hatred for rural whites among the left is disgusting, John.

It is not obvious to me that illegal immigrants represent more of a drain on national resources than those who are here legally, but it apparently is to you.

Mr. Donohue: Thank you for your admission that illegal immigrants represent a drain on national resources. Let's suppose that they represent, say, half the drain on "national resources" that a citizen does. Does the country wind up more "drained" or less than if they weren't here doing the draining?

Hoppy,

Well, obviously those who are here legally are not a 'net' drain on national resources, otherwise we're in big trouble.

In which case, allow my to rephrase: It is not obvious to me that illegal immigrants represent a net drain on national resources, and they may be more of a net positive than those who are here legally.

It is not obvious to me that illegal immigrants represent more of a drain on national resources than those who are here legally, but it apparently is to you.

You mean the selective screens we erect for legal immigrants to navigate have no effect on the quantum of human capital of the immigration pool?

@Art, I'm comparing illegals to everyone who is here legally, not just to legal immigrants. The screen for people who are born here is much lower.

BD,

People who study the issue will be glad to tell you that legal low-skill immigrants are typically a greater burden than illegals. Legal high-skill immigrants are not. Illegals are particularly offensive because they are both a burden and have no right to be here. Folks who take immigration reform seriously (not the Open Borders / Amnesty crowd) want to slash low-skill legal immigration and end illegal immigration.

Stated differently, low-skill legal immigration (typically chain migration) is well known to be a substantial economic drain, but is tolerated (more than illegal immigration) because it is within the law.

"The screen for people who are born here is much lower." - which is why we should do a good job picking the best people we can.

Yes, contrary to popular belief, small business owners are more likely to skirt/flout labor laws than large companies. That's because the DOL and, more to the point, plaintiffs' attorneys -- targets the whales, not the minnows.

This is one reason why liberals prefer big companies- it makes it easier to foster social policy.

But understand my point. These small business owners, these people work their asses off for a living, they are not plutocrats. They employ people. They make payroll. And they have work that they could be doing that would seem to be useful for everyone involved - themselves, their employees, their customers - and that work is not happening because they can't find enough people to do the work.

BD,

Let me offer a set of empirical tests of whether the U.S. is suffering from a shortage of unskilled labor or not.

1. Are wages for unskilled labor rising or falling? What is the medium and long-term trend?

2. Is LFP for unskilled labor rising or falling? What is the medium or long-term trend?

3. Is income inequality (say the 80/20 or 90/10 ratio) rising or falling?

The answers here should be pretty obvious. The third point is very important. A labor scarce society will see declining inequality as the returns from unskilled labor rise and the returns from employing unskilled labor fall. Clearly, that's not the United States. As for "not being able to find enough people to work"... At what wage level? 10% of what the owners expect? or 5%?

Antebellum plantation plutocrats complained about the price of slaves. Some things never change.

"...and that work is not happening because they can’t find enough people to do the work. "

That's a bit of a canard. They can almost certainly raise their wages $2-4 per hour (assuming low skilled positions) and have no problem filling their slots.

Pushing high immigration in order to provide cheap labor is fine as long as it doesn't impose any costs on others. However, if the immigrants are paying less in taxes than they are collecting, the requisite short fall is made up by raising everyone else's taxes have to go up to compensate. So the owners of the small business are trying to spread their costs to everyone via taxes versus just directly raising their workers pay. I've got little sympathy for such a business owner.

@JWatts, clearly I lack your understanding of the corrugated box business and unskilled labor market conditions northwest of Chicago, I was just going by what the cheap chalupa munching plutocrat sonofabitch owner that refuses to pay a living wage or hire all the qualified whiteys banging down his door told me.

I'm sure those boxes would just have been used for more mindless consumerism people don't need anyway, right?

"clearly I lack your understanding of the corrugated box business and unskilled labor market conditions northwest of Chicago, "

It looks like you are arguing that the US needs more cheap labor to benefit the Chicago card board box industry. I don't see any reason that the US taxpayer should subsidize the cost of imported cheap labor to benefit his business.

Person A wants to hire Person B to help deliver a product to Person C. You call this a subsidy and invoke Person D, at home playing video games and not interested in doing Person B's job at any realistic price. Got it.

That's a straw man you are arguing with.

My point is that if a Low Skilled immigrant receives $20K a year in public benefits and contributes $10K a year in taxes, then other tax payers have to make up for the deficit.

If the Chicago box manufacturer is complaining that he would rather have more of those Low Skilled immigrants versus a Citizen who he would have to pay an additional $8-16 K a year, then I have little sympathy for him.

You said 'if'. I challenge your premise.

Also, I'm getting a vibe that you know basically nothing about the difficulties of finding reliable low-skilled labor.

And "just pay 'em more"? You know, this is an economics blog, and the job may not be able to justify the higher wage, and the idea that reliable, low-skilled natives will come out of the woodwork for a couple more bucks an hour is wishful thinking anyway.

You're basically saying "The job shouldn't exist, the company shouldn't make the box, the customer shouldn't buy the box." Because in your world, that's what happens.

$2-4 bucks? At that wage range there are people switching jobs for an extra 25 cents an hour. An even more important perk is to make sure you're close to a bus stop.

Anyway, all this post really says is that capital and labor have contrary interests. This is not a new observation.

BD,

"That’s all well and good, but the numbers I saw suggest that male illegal immigrants 25-54 in this country are more likely to be working than their native-born counterparts"

The numbers I see, show them to be roughly equal. However, let's assume you are right for a moment. Here are the gigantic problems.

1. They are taking jobs (a four letter work to be sure) and wages from Americans who need them. Those Americans don't disappear, they go on welfare one way or another.

2. Male illegals have rather high crime rates. Every serous study has found that a huge portion of the jail and prison population is illegals (see the GAO work on the subject). Fox News has also (more recently) looked at this as well and come up with numbers that mach the GAO. Like it or not crime is a cost to society.

3. Illegals have wives, girlfriends, children, abandoned girlfriends, abandoned children, etc. They are all eligible for the most expensive handouts the U.S. has (health care and education) without restriction. On paper, the U.S. does impose some restrictions on welfare use by illegals. In practice, enforcement is essentially zero.

4. In a welfare state, even low-skill immigrants who work are a stunning burden. Why? Because the welfare state costs exceed their entire earnings, not just what they pay in taxes. In other words, even if low-skill immigrants paid 100% of their income in taxes (they don't) they would still be a crushing burden.

5. The argument that male illegals work (and impose few costs) is a trope of the pro-Amnesty crowd. However, the contradiction should be obvious. Illegals can only be profitable as long as they remain illegal. Once they become legal they are eligible for everything (much of which they are using anyway) and can now import their families to burden America. Using the (supposed) low costs of illegals to justify Amnesty makes no sense at all, but is typical of the Open Borders crowd.

An females are less likely to be in the labor force.

Steve,

Peter Schaeffer's estimate of health care costs is $12 per hour, not $12K per year. For a family of four, that's roughly $40K per year. In other words, even if low-skill immigrants paid 100% of their income in taxes, they would impose vast costs on society via health care alone Of course, the costs of low-skill immigrants are not limited to health care. "Education" (attempts at education), housing, food stamps, WIC, prisons, etc. are all extra.

Peter,

How many people under age 25 (age 30 even) are a net drain this way, legal or otherwise? Gotta be a majority.

And how many immigrants are in this demographic?

BD,

In a narrow age range (say 20-30) most people are not a net drain. In that age range health care costs are very low and utilization of public services isn't that high. Of course, an immigrant female with two out-of-wedlock children (very common) is a massive burden on society. So is her native-born counterpart. However, we have (should have) a choice about who crosses our borders.

I love this argument. We have a hole, so we should keep digging. Terrible, BD

Re: Peter Schaeffer’s estimate of health care costs is $12 per hour, not $12K per year.

That sounds way, way too high-- probably because it's an average and it is skewed high by the relatively small number of very sick (and very expensive) people. I can tote up my healthcare expenditures (paid by both insurance and out of pocket) for the year so far and even though I'm 48 and have asthma it's far less than 12K, let alone 40K. This is one area where the median would be a much more sensible stat than the average.

JF,

"That sounds way, way too high– probably because it’s an average and it is skewed high by the relatively small number of very sick (and very expensive) people."

Of course, the median is far below the mean. However, the mean is what counts because it reliably predicts (even under-predicts) the costs low-skill immigrants will impose on our nation. The low-skill immigrant population clearly incorporates an equal (or greater) share of "very sick (and very expensive) people".

All insurance programs (public or private, medical or property, etc.) are based on medians that are far below the average. That doesn't change the fact that premiums are based on averages.

Steve,

My original post.

"Yet another nail for the coffin. U.S. health care expenditures are around $12 per hour for the entire economy. The minimum wage is $7.25 per hour. If a minimum wage worker paid 100% of his income in taxes (or health care premiums), America would still lose $4.75 on health care costs alone.

And Tyler wants to flood American with low-skill immigrants to drive wages down further (presumably after repealing the minimum wage)? Is this meant to be a parody of ‘privatizing profits and socializing costs’? Perhaps it is.

Of course, it can be argued that low-skill immigrants don’t cost $12 per hour in health care costs. As long as they are young and single that is true. However, low-skill immigrants have children and grow old just like everyone else. Even if they don’t cost $12 per hour in health care costs now, they will cost far more than $12 per hour in the future.

The welfare state and low-skill immigration don’t play nice. One or the other has to go. Since the welfare state is only expanding, it should be obvious that mass immigration has to end."

But won't education and diversity lift all boats?

"In these cases, the immigrant children are really just receiving a loan which they will have to pay back from their own earnings later in life"
No, they don't. They don't legally owe anything, and if they spend the rest of their lives a net consumer of taxes, no collection agent is going to come by to make them clear their "debt". I would have thought a libertarian would understand this.

Shouldn't this post include some, like, numbers?

Such as: what percentile of income divides net tax consumers from net tax contributors?

And what percentage of immigrants (and their children) fall in the net tax consumers and what percentage in the net tax contributors?

Open Borders ideologues don't like to answer these questions, so they tend to start screaming "Racist" at anybody who questions whether stoop laborers' children will pay off.

It's almost as if the ideologues are subsidized by the Cheap Labor lobby.

Some days you hide your racism well. This is not one of those days.

WAYCIST waaaahh waaaaah

There is no Cheap Labor lobby. If there were, would I deny its existence?

John,

"Some days you hide your racism well. This is not one of those days."

I guess the definition of "racism" is "facts I don't like and can't refute".

The Urban Dictionary has a definition of "racism" that may help you.

"Anyone winning an arguement with a liberal. It does not matter what the arguement is, if a conservative is winning it, they are a racist. Also anyone not supporting all liberal ideas and beliefs."

Such as: what percentile of income divides net tax consumers from net tax contributors? -

I think it's around the 30th percentile. The income thresholds for Medicaid eligibility and housing voucher eligibility are around about there.

AD,

"I think it’s around the 30th percentile."

In word, no. Remember that the public sector (local, state, federal) as a whole is running large deficits. That means that the average (not median) taxpayer is still a net tax consumer. Of course, I am including all households (not just those that pay taxes) in this calculation. Since that average taxpayer is more affluent than the median taxpayer, most folks are (probably) not net taxpayers. You probably have to get to the 6th or 7th docile to be a net tax payer in the U.S.

For a typical data point, see "60 Percent of Households Now Receive More in Transfer Income Than they Pay in Taxes" (http://taxfoundation.org/blog/60-percent-households-now-receive-more-transfer-income-they-pay-taxes)

You're attributing the benefit of public goods and policing to particular households. I am not.

Open borders is something I believed in as a 19yo radical liberal. Most people grow out of it though.

It doesn't work. For starters, if hundreds of millions moved to the US from grinding poverty in Africa and did not receive any welfare handouts, the resulting extreme inequality would lead to Jo'burg-style crime levels.

For this reason I think Alex's logic works better with more liberal visas, and not full blown migrations.

Visas, particularly work visas, are underrated.

Here's a Muslim jihadist from Britain explaining what Syrians are like as co-workers:

http://abusaeedawlaki.tumblr.com/post/128405472143/culture-clash-understanding-the-syrian-race

His comments are pretty similar to T.E. Lawrence's observations in "The Seven Pillars of Wisdom" over 90 years ago.

Perhaps shorting BMW and Audi stock would be a clever ploy?

"Syrians are childish and will steal your shoes.". Brilliant.

John,

Perhaps you might actually read what a Jihadist thinks of Syrians. The Jihadist in question doesn't appear to be constrained by commonplace notions of Political Correctness. Calling him a "racist" isn't going silence him.

Schooling may increase wages later but that does not mean that the children of those immigrants will pay in as much as they receive. Do you think public education is a free lunch?

If our welfare state consisted only of forced savings and free lunches, I'd agree with you. It doesn't.

I think public education has a huge ROI, especially compared to the counterfactual (widespread illiteracy).

There is nothing wrong with improving educational ROI further.

There is nothing wrong with improving educational ROI further.

Just wave our magic wands and do what generations have failed at.

John: I think, therefore, it's true.

Here is the problem. We see that Mexican immigrant kids way way outscore Mexican kids in Mexico on the PISA exam. But Mexican immigrant kids and hispanic kids in general score much much lower than American kids on the PISA. Just for comparison, Asian kids in the USA also outscore Asians in Asia, but they also outscore American kids. So, the problem is not that Mexican and Asian kids don't benefit from schooling in the USA, clearly they do. The problem is that Mexican/hispanic kids are still low performing. And low performing is low performing.

There’s no doubt that in a perfect world, without tyrannies forcing millions to fled their homes for different reasons and fair justice systems all over the place open borders is the best solution but there’s no such thing as a perfect world.

Open borders critique:

http://slatestarcodex.com/2015/09/22/beware-systemic-change/#comments

Social Security for example is mostly a forced savings program.

No, it isn't.
The money that you pay into social security goes to pay current retirees benefits. The benefits you not are not directly tied to how much you pay in - they are tied to your lifetime earnings. That's how they index the benefits so that low-income retirees get proportionally bigger benefits. And there is no solid guarentee that promised benefits will actually be delivered. Future congresses can change the formula. Social Security is just a welfare program that you pay taxes for. There are no savings involved.

it is very similar to an annuity, isn't it? no one complains when one member of an annuity effectively pays another.

a forced savings plan of subtype annuity

An annuity that doesn't ever need to pay you anything

No, it's not at all like an annuity. An annuity is a bond that you buy and has a set interest rate and payout schedule. When the money runs out, you stop getting payments.

Social security is a skewed formula vaguely related to your income that can be modified at will by future congresses.

"An Immediate Income Annuity, or Life Annuity, or Single Premium Immediate Annuity (SPIA), is an insurance product that pays you a regular income (monthly, quarterly, etc.) for as long as you live. "

Not the kind of annuity my mom had, but in that case, I'm pretty sure that the amount to pay for the annuity is rated fairly explicitly to your individual age and life expectancy.

Single premium annuities are entered voluntarily with the understanding that the person only gets paid as long as he lives. The actuaries have already calculated how long the pool of consumers of these products will live and that is how the insurance company makes money. They charge $100k for a product with an average value of $60k.

"it is very similar to an annuity, isn’t it? no one complains when one member of an annuity effectively pays another. a forced savings plan of subtype annuity"

So you are ok with replacing Social Security with forced private annuities?

You could have a welfare state for long-termers combined with open borders. Call it a free-for-all temp workers program, if you like. Or alternatively stated, a visa-free workers' market with access to the welfare state being guaranteed to citizens and highly restricted to temps.

Another poster mentioned that this could push some current taxpayers onto welfare, because they would lose their jobs. I'm not sure how to correct for this problem in a sustainable manner. Perhaps the following suggestion could address the potential fiscal imbalance associated with this?

A potential answer could be that temporary workers would be taxed at a relatively high rate but still not qualify for benefits for quite some time. This is normal in a lot of places. I recall paying fairly high taxes even as a low-end manual labourer in Australia, despite not qualifying for any public benefits. Perhaps such a system would allow for citizens who lose jobs to benefit from welfare, in a system which combined open borders with restrictions on access to the welfare state?

Also, incomers could be forced to either a) hold some savings in a special account or b) take out insurance: so that they could return to their country of origin if their job situation turned out for worse. The goal of this would be that they would not burden the welfare state (and therefore uphold the possible ability to have both open borders for labour market purposes together with a restricted welfare state).

Yes, The Qatari/emirates model. That's wonderful. We can just start building our stadiums on a stack of dead bodies right now.

So do it differently that Qater/emirates. Namely, uphold labour safety laws.

Also the minimum qualification to receive social security benefits is to pay into it for 10 years, or 40 quarters. With the qualifying amount per quarter being around $100-$200. (i.e. you could have a part time job for a couple of months and earn enough to qualify for two quarters.)
Also taxes paid while not a US citizen count towards those quarters. I know this because paying into SS exempts you from certain immigration requirements. In theory you could game it to pay into it just enough to qualify for the minimum benefit upon retirement, or for disability.

We'll lose money on every transaction but make it up on volume!

Stop being stupid

Kind of funny, but honestly, no one is defending that sort of argument.

Any legitimate proposals which might bring notions of the "welfare state" and "open borders" together?

I don't get it. It's true: we lose money on each illegal immigrant we bring in, but Alex thinks it will work out ok. It's idiotic.

I've seen numbers on both sides of the argument. Some claim a net benefit, some claim a net cost. I'm really quite unsure what to conclude about the matter.

There is not a net benefit. There is benefit to specific groups. Those specific groups give to political campaigns. Mystery solved.

but Alex thinks it will work out ok

He does not truly think it. He lies. He needs to be a "good guy".

go on, link. We've all seen the studies that suggest that legal immigrants might be a net positive, but they're ridiculously more skilled than illegals/the type we'd get with open borders.

Here's a graph showing how many people live in countries poorer than Puerto Rico:

http://www.unz.com/isteve/how-many-would-emigrate-almost-7-billion-people-live-in-countries-poorer-than-us/

As you hopefully know, about 5/8ths of Puerto Ricans now live in the 50 states, even though the average Puerto Rican in Puerto Rico has a higher GDP than the residents of countries with a total population of over six billion.

Don't stop Steve, you're on a roll today!

1) Immigration is the welfare state importing its own constituency.
2) Immigration is political and cultural suicide for libertarians.
3) Alex is psyching himself up for TED talks where he lauds the welfare state's "liberty-enhancing" aspects.

I haven't seen any libertarians respond to your second point. Forget the normative stuff, I'd like them to respond to the claim that mass immigration of socialists will make the US more socialistic.

It seems they are obliged to pretend that it wouldn't happen. (Because that would be extremely awkward, reminding them that only white males care about libertarianism.)

Alex, it seems the most elementary economic mistake in your post is that inasmuch as public schools are financed largely by property taxes, immigrants are already paying for their kids to go to school because even if they rent, their landlord has priced his property taxes into the rent. Also, schools as well as sometimes the majority of state and local services are financed by sales taxes, which immigrants also pay. So a low wage immigrant is actually more of a contributor than a low wage native because the illegal immigrant cannot claim EITC or the refundable child tax credit or any other deductions which sometimes result in the low wage native receiving benefits rather than paying income taxes.

I can understand the pro-immigration mindset (am an immigrant myself) but to argue that low-skill immigration works out from a welfare state perspective is delusional.

The break-even point for how much one pays in to the system vs. gets out of it is far higher than almost all low-skill illegal (or legal) immigrants earn. Jason Richwine's study on this was quite compelling and matches research done by disinterested sources (i.e., not financed by Fwd.us and other shills).

To argue otherwise as Alex does is just a sad reminder of mood affiliation's power...

Don't be such a Chump - in NJ, e.g., schooling costs about 13k per pupil - no low skilled immigrants sales and property tax contributions are coming close to that number.

Over their whole lifetime the average illegal isn't going to pay the $700,000 in taxes 13 years of school and 18 years of Medicaid their three kids will consume.

So a low wage immigrant is actually more of a contributor than a low wage native

And by "more of a contributor" you mean "slightly less of a drain"

Alex, it seems the most elementary economic mistake in your post is that inasmuch as public schools are financed largely by property taxes, immigrants are already paying for their kids to go to school because even if they rent, their landlord has priced his property taxes into the rent.

I guess everyone is paying taxes, because we all buy things, and the people who sell those things price their taxes into the products.

Chump,

"Alex, it seems the most elementary economic mistake in your post is that inasmuch as public schools are financed largely by property taxes, immigrants are already paying for their kids to go to school because even if they rent, their landlord has priced his property taxes into the rent. Also, schools as well as sometimes the majority of state and local services are financed by sales taxes, which immigrants also pay."

Where do you come up with this stuff? The cost of educating the children of low-skill immigrants typically exceeds 100% of their income. Try some "math" (a dangerous four letter word). Say a low-skill immigrant earns $10 per hour and pays 20% in taxes (including indirect property taxes). That's $4k per year. Education runs around $12K per student per year. With two kids, that's a net loss of $20K and we haven't even started with WiC, food stamps, EITC, health care, etc.

Chump,

"because the illegal immigrant cannot claim EITC or the refundable child tax credit"

Oh yes they can. The system pays EITC automatically without any checking for legal status. The following quotes are from "Karen"

"My brother does some work for the federal government’s farm insurance program and he has to go around and measure fields, determine what percentage is ruined etc. Anyway, he talks to farmers. Several have told him that their workers used to throw out the W-2 forms when he handed them out in January, just throw them right in the trash. Now they pester him to get them out fast because they are eager to file income tax returns and get the Earned Income Tax Credit. Its thousands of dollars."

and

:"The farmers tell my brother, “They’ve got better papers than you have.” I suspect they are illegal though I don’t know if they might not be in some huge guest worker program. The farmers also say that the first generation are good workers – provided they are supervised – and very obedient. And they are rather small people, the first generation. The second generation want nothing to do with farming. They work at gas stations or stores. The third generation is thoroughly at home in the US and go on welfare any way they can. (That sounds like at least these imported farm workers and their descendants aren’t joining drug gangs. I hope that’s true, at least.)

Of course, if they have a medical expense they do not pay it because the bill comes in with an astronomical figure. If you have insurance, you see that the insurance company might pay 10% of what the hospital bills or less or even disallow it entirely but these folks don’t have insurance and they can move away very easily.

Another kind of immigrant my brother hears about in the vegetable farming industry are Koreans who buy from those farmers. The Koreans are all cash businesses. They negotiate with a combination of hand signals and writing numbers and when they reach an agreement, they pay cash and a bunch of other Koreans appears from out of no where and takes the vegetables away. Do they pay any income taxes?"

Its a myth that the controls on welfare payments are in place.

Also, the fact that EITC fraud is a huge business is another piece of evidence that the controls are not in place.

You have to provide a valid SS# for most forms of welfare. And yes they check. I went round and round with Maryland on unemployment last year because of a stupid SSA records glitch that caused me to fail something like e-verify that they use to verify applicants. They wouldn't even accept a US passport as proof that I was who I said I was, and a US citizen.

If an illegal alien has children in the US (or grandchildren), who have a SSN, live with them more than half of the year, then they qualify for the EITC.

JF,

"You have to provide a valid SS# for most forms of welfare"

That's not much of an obstacle. SSN's (fake, real, stolen, etc. are commonplace) Our government "helps" by giving out EITN's to illegals with no checks on status.

E-Verify is a relatively rare. From a prior post (of mine).

"Only in theory are illegals inelligible for health care. In real life, the restrictions are far fewer than you might imagine. First of all, hospitals are required to provide emergency care irrespective of legal status. Second, the American born children of illegals are always eligible.

However, the third point is probably the most significant. Most of the social welfare apparatus simply doesn’t check the legal status of anyone seeking benefits (apparently). If legal status is ‘checked’, the applicants are allowed to ‘self-certify’ their legal status. The GAO did a study of illegal alien criminals a few years ago and found that on average they had been arrested 7 times with zero checks for legal status. If the police weren’t checking legal status, do you really think Medicaid applications were / are being carefully scrutinized? Note that because of Secure Communities the police do make some attempt to check legal status these days.

A few years ago, I saw a long online debate on mint.com about immigration. Some folks claimed that illegals collect all sorts of benefits that they are theoretically ineligible for. Others claimed that this was impossible because of the law. The facinating thing was the number of people who actually work in welfare departments who posted comments to the effect ‘we never check’, ‘don’t ask, don’t tell is the rule’, ‘I would be fired if I checked’, ‘we aren’t allowed to check’, etc."

Obama's own family provides excellent case studies in the pervasiveness of immigrant (even illegal immigrant) welfare fraud.

From a prior post (of mine)

"Take a look at Obama’s family. Onyango Obama was ordered out of the U.S. in 1992 (by a court) and was busted for a DUI last year. He’s still here of course. Then we have Zeituni Onyango. She was ordered out in 2004 but is also still around (with the help of high-priced lawyer and presumably family). Quote from

“The Continuing Saga of Obama’s Illegal Alien Aunt & Uncle”

“If you want to get angry, really angry, watch this video. Americans were rightfully livid after hearing the story of this unapologetically arrogant woman who blamed our system for giving her so much; a place to live in public housing, $51,000 in disability payments and regular welfare payments of almost $700 per month, not to mention the taxpayer-funded hospital stays and treatments.”

So much for illegals not being able to exploit the welfare system. Of course, the only unusual thing about Obama’s relatives is that they are his relatives. In other respects, they are just commonplace illegals. Welfare abuse, DUIs, ignoring court orders, etc. are nothing unusual in the immigrant community.

Michelle Malkin wrote a book about this ” Invasion: How America Still Welcomes Terrorists, Criminals, and Other Foreign Menaces (2002)”. The bottom line was simple

“It ain’t over until the illegal alien wins”

Her summary of the book follows.

“Invasion shows how every component of immigration enforcement has failed — from overwhelmed consular offices, to overwhelmed borders, to overwhelmed detention centers and deportation proceedings. I tell the buried stories of dozens of Americans who died as a result of lax and incompetent immigration enforcement: grandmothers, teenagers, rookie cops and veteran troopers brutally murdered by criminal aliens on the loose. I analyze the immigration failures that led to September 11, and I expose the shocking stories of torturers and other suspected war criminals who waltzed through our front doors along with foreign terrorists"'

@PF: the good news is, a lot of places would ban you for making the proprietor look so stupid so many times in a single thread, and that hasn't happened here.

"their landlord has priced his property taxes into the rent"

People almost always "forget" about this when they mention how little taxes some people pay. Same goes for sales taxes. This is highly underappreciated by people who feel good about themselves when they get into the mood for berating the poor.

That's not a particularly smart comment. Property taxes are hugely progressive. Most illegal immigrants aren't going to pay anywhere near enough property taxes to cover the costs of public education.

"This is highly underappreciated by people who feel good about themselves when they get into the mood for berating the poor. "

Oh, you were torching some straw man, never mind.

It's widely known that the bottom half of income earners are net recipients of government transfers.

https://www.cbo.gov/publication/49440

Now, obviously, the composition of that bottom 50% changes over time so at some point, nearly all of us are in the bottom half.

The question is, how many farmworkers or maids in Los Angeles EVER join the top half of income earners? Would that situation change if the supply of low skilled labor was growing more slowly?

I refer to arguments where people claim something like "x percent of the population who contribute no taxes..."

You can argue that they are net beneficiaries, but EVERYONE pays taxes.

People at 20-30k easily pay a higher share of income as taxes than a great number millionaires/billionaires, whose income is from capital gains. Obviously, due to scale, they may still be net beneficiaries.

You must live in Texas. Lots of public education is funded with state income taxes.

Amusing that Alex thinks himself smarter than Milton Friedman.

I guess its possible but nothing to date illustrates it.

For programs like schooling there is also no problem–even if the schooling is provided free to immigrant children–because the schooling leads to higher wages later in life which are taxed. In these cases, the immigrant children are really just receiving a loan which they will have to pay back from their own earnings later in life. The story for basic health is similar.

Care to show your work? A school inundated with Latin Americans and East Asians, the latter speaking obscure and difficult languages, is bound to be a high-overhead enterprise. It is especially so if you get clientele with high propensities to contumacious and disorderly behavior (which school administrators are constitutionally unable to address).

Every person in America consumes, on average, about $20k in government services. If you aren't paying an average of 20k in taxes over your lifetime, you are a net drain on the economy. What percent of illegal immigrants meet or will meet that standard?

GDP per capita is about $53,000. Government spending is about 40% of GDP, or $21.2k. About 4% of GDP ($2,000) is defense spending, a fixed cost, so call it $19.2 in everything else - roads, police, prisons, schools, Social Security, government health care, welfare.

Statistics are racist.

Wrong comparison. You should compare what you take in government services to what you make overall, since that defines what you contribute (via labor or whatever) to the economy as whole. Anyone who makes over 20K is thus a net contributor.

"Anyone who makes over 20K is thus a net contributor."

That's a laughably bad comment. That person will result in a tax deficit and everyone else will have to contribute higher taxes to make up for it. So no, they sure as hell are not a "net" contributor.

This kind of thought experiments only work with a very important condition: if nothing is paid to people that have not contributed to the fund.
While this is possible in theory, in practice it would never happen: nobody would accept in a welfare state for people to starve, be homeless or be denied medical care because they have not paid their taxes.

Do you think ISIS would benefit from open immigration?

This isn't quite as transparent as Kathy and 'Carol' Fata, but you do wonder why a pair of academic economists should be so intent on open borders that they offer swiss-cheese arguments.

AD,

"This isn’t quite as transparent as Kathy and ‘Carol’ Fata, but you do wonder why a pair of academic economists should be so intent on open borders that they offer swiss-cheese arguments"

Because Open Borders is a dominant ideology. In other words, people who believe in Open Borders are generally willing to sacrifice everything else they believe in on the altar of Open Borders (fanatical religious cults come to mind here). It wrong to think of AT or TC as "libertarians" because Open Borders is overtly in conflict with everything "libertarians" purport to believe in (low taxes, limited government, freedom of speech, personal responsibility, etc.) Like it or not, AT and TC are cosmopolitans for whom a borderless world is a goal of such merit, that anything and everything can be sacrificed to attain it.

people who believe in Open Borders are generally willing to sacrifice everything else they believe in

That's uncharitable, and you know it. Libertarianism is about freedom, first and foremost. And the unfettered right to movement is a core freedom. If that has the effect of decreasing public support in other libertarian ideals such as free speech, low taxes, limited government (as you assert), that would be a second order effect of applying a core libertarian principle, and hardly inconsistent with libertarianism. And there's no guarantee that every group of immigrants will be hostile to the libertarian ideology; it's not like you can mathematically prove that certain people will rigidly hold on to certain kinds of beliefs. So a true libertarian would advocate his/her package of beliefs, which includes free speech, etc. plus the freedom of movement, and that's in no way self-contradictory. Libertarianism is an ideology, and a fringe one with minority appeal; its adherents do not now and will not ever (because of an aversion to collectives) think of it as a political program to be fulfilled in increments and bounds, sometimes surreptitiously if need be; libertarianism is not Communism.

There is no such thing as an "unfettered right to movement." In a libertarian regime, all movement off your own property would require the permission of adjacent owners.

OK, "unfettered right to movement" in public spaces (commons) then. I'm trying to imagine what a land without any public spaces (i.e., every square inch being someone's private property) would function as; it would seem to be an unstable equilibrium, as no one could ever move without signing thousands of bilateral "treaties"; something like a constitutional arrangement with regulation of public spaces must necessarily be the result. And when it comes to public spaces and collective ownership, libertarians just happen to be at one extreme end advocating non-discrimination even on the basis of nationality, which is anathema to most other people (not just conservatives.)

OK, “unfettered right to movement” in public spaces (commons) then

The unowned commons being the oceans, large seas, and Antarctica? Because Americans own America.

@Careless:

As I already stated in my earlier comment, libertarians are not big on collective ownership of property at a sufficiently large scale which also contains exclusionary clauses (i.e., property belongs only to people of a particular nationality.) At least, that's what I think. I don't know what libertarian doctrine has to say on this matter, and about vital shared resources in general. But even if the principle were "property rights uber alles at every imaginable scale", one could argue that they are only advocating for a particular policy (open borders) as part owners of that property. Voters opposed to that policy (overwhelmingly in the majority) can vote them down, as they do and have always done. But calling them hypocrites and saying they shouldn't be advocating their beliefs is not cool; as owners/shareholders (choose whatever metaphor you want), they do have a right to voice their opinions.

Kris,

I don't buy the "Libertarianism is about freedom" line, but let's assume I did. Life and public policy are about choices and trade-offs. If you are wiling to sacrifice everything (freedom of speech, low taxes, limited taxes, personal responsibility, etc.) for Open Borders, then you aren't a Libertarian anymore. You are an Open Borders zealot.

Let me offer an analogy. Freedom on speech is (used to be) regarded as a core Libertarian value. If that value came info conflict with Open Borders (it does, ask the editors of Charlie Hedbo) a Libertarian might recognize the conflict and decide what tradeoffs were in order. When a so-called Libertarian advocates sacrificing all core Libertarian values for just one (Open Borders), we aren't talking about Libertarianism anymore, just the religion of Open Borders.

Of course, the very idea of Libertarianism is just an ideological mask. Without exception, so-called Libertarians insist that their home, their property, their life of privilege, their bubble (a quote actually) is sacrosanct and must be rigidly protected at all costs by the very same police and government authorities who must never (ever) attempt to enforce borders.

Basically, doors and walls for me, but not for thee. Honest Libertarianism must accept that if people who right to live in whatever country, they find most congenial, they also have the right to live in whatever property they find most congenial. The moral logic of Open Borders doesn't end just when it stops being personaly expedient for Alex. The ideology of personal greed does, but that's not Libertarianism.

Freedom on speech is (used to be) regarded as a core Libertarian value. If that value came info conflict with Open Borders (it does, ask the editors of Charlie Hedbo)

But it doesn't. Taking the Charlie Hebdo case, if free speech suffers a setback, it is because the perpetrators of the crime are not treated as the criminals they are by the state, not duly punished in a way to deter others like them, and society doesn't disapprove what they do (killing people for lampooning.) And as a result of that, people might be intimidated into staying quiet. So a second order effect might be that people may not choose to exercise their free speech rights, but the principle itself has hardly been vitiated. And you can expect libertarians to vigorously defend free speech rights in the face of intimidation. In the French case, if society is not willing to stand up for free speech, it's that society that had a problem with libertarianism to begin with and not just the reactionary immigrants.

The various arguments for reducing migration levels are all good and sound, but they hardly need to be buttressed by conspiracy theories about hypocritical libertarians who desire the destruction of ethno-national communities. I see no hypocrisy on the part of the libertarians (a small minority with little influence even in freedom-loving America), but rather the blind application of principle.

Tyler likes cheap ethnic food.

That's a not a horrible reason.

Maybe that explains the "Swiss cheese" arguments. ;)

It's an idealistic theoretical principle.

One day, someone will resolve the contradictions, and we will set up a system where anyone can go anywhere they want.

It starts with dreaming. These guys aren't naive.

It can be done. Just not with welfare states.

Once you accept high inequality and starvation inside of your nation, as opposed to elsewhere, you can make Open Borders work.

"Immigrants" used to be sojourners. There were traditional customs of hospitality but no such thing as "civil rights" and no public welfare. Governments would ban or exile criminals and activists.

Troll post by alex? What is this

The more complete and thoughtful warning is: Welfare state, Democracy Open Borders: pick any two. Large numbers of immigrants who quickly become citizens (or who vote in jurisdictions that aren't punctilious about non citizen voting) can quickly shift the delicate balance of power toward a larger and larger welfare state. Indeed this is what the Democrat party is counting on. Dependency on government is now at half the population. deTocqueville rightly diagnosed the risk to American democracy as being when the voters figure out that they can vote themselves benefits. Unrestricted immigration accelerates and deepens this moral hazard.

My other problem with economists on immigration is that you ignore culture: yet culture is essential to capitalism. And most cultures are not particularly conducive to capitalism. See Brazil for an example.

For programs like schooling there is also no problem–even if the schooling is provided free to immigrant children–because the schooling leads to higher wages later in life which are taxed.

Well, it costs $10,615 to educate a kid for one year, multiply that by thirteen and you get 137,995$. Immigrant children would have to improve their lifetime wages by, say, 1 million dollars in order to pay that back.

But I'm sure to a lot of people that doesn't sound very unreasonable to a lot of the Leftists who have a religious faith in the power of "Education."

Actually, I think the real reason is that a lot of Leftists feel that it's just a case of the rich paying more money; and those same type of people tend to think there is a limitless bucket of Other People's Money.

Education effects on lifetime wages obviously aren't zero, but it's not cost-effective. You could probably do better with a eugenics program. Use the funds to actually breed high-talent people and educate those specifically.

Why bother spreading $$$ out over the bell curve when you can optimize?

JB,

I suspect that the $10,615 number is not quite right. That looks like the current cost per student. However, the total cost has to include both current costs and capital costs. Capital costs (school buildings and the like) add another 10-15%. $12K per year is a better estimate these days. Check out http://www.census.gov/govs/school/ for the actual numbers.

For fun take a look at some of the bigger urban districts. The dollar outlays per-student will boggle your mind. Not much education mind you, but lots of money.

I love when pschaeff comes here and drops bombs all over the place, start a blog breh

So does open borders clash with universal basic income?

http://www.memri.org/clip_transcript/en/5076.htm

"Milton Friedman famously said that you can’t have a welfare state and open borders."

Never mind welfare states.
In today's world no state could survive with truly open borders.
In reality, only failed states have truly open borders.

Neither the welfare state, nor the idea of open borders is a purely economic issue.

Both of them have a tendency to erode fundamental values and to undermine civilization.

It doesn't surprise me that Alex Tabarrok would put up a troll post (or at least I hope its a troll post given the lack of reasoning / evidence exhibited in it) but I am much more disappointed that there are multiple commenters in the thread who seem to buy in to Open Borders rhetoric.

This P. Schaeffer is really fighting the good fight -- one day I hope it isn't necessary

Peter Schaeffer wins this thread! Wow!

Peter Schaeffer, do you have a blog or twitter account to follow?

A.T.: "... the only cases where there is a worry about excessive transfers from citizens to immigrants is in pure handouts or health benefits to say the elderly. In these cases, I would simply say that such benefits are not available to immigrants or only available after five years or some such time period."

How does a short waiting period solve the problem? Obviously it doesn't. And we have already experimented with "simply" denying such benefits to immigrants-- that "simply doesn't work" as Peter Shaeffer pointed out, and it will never work with mass immigration because as soon as any large number of immigrants arrive they constitute a potential voting bloc big enough to attract demagogues who want to extend the vote to them, with the eager connivance of political parties who want more client-voters. Even before they get the vote immigrants can staff parades and riots until someone buys them off at taxpayer expense, the poor "oppressed" darlings, subject to "taxation without representation."

The ignorance in this rationalization is staggering. Social Security is not a savings account. There is no Social Security trust fund and the money we are forced to pay into it is not sitting in a bank somewhere with our names on it. The money collected today is being paid out to those receiving social security and any surplus is going into the general treasury. Thus, it is a Ponzi scheme.

DM,

Social Security is less of a Madoff (Ponzi) scheme than you might think. Of course, it's not a "force savings" system either. Calling it a "forced savings" system is pure Pinocchio. Claims like that are so poor, we could use Pinocchio's nose to explore outer space.

However, that doesn't make it (Social Security) a Madoff scheme. Take a look at the SSTR (Social Security Trustee's Report). Right now Social Security is roughly break even (cash coming in roughly balances cash going out). Over time, the aging population will raise outlays (and reduce revenues). However, relatively small changes in payroll taxes will keep Social Security in business far into the 21st century.

The definition of a Madoff scheme is "an investment system where the cash from early participants isn't actually invested but used to provide the illusion of high returns to the initial participants". Since Social Security doesn't purport to be an investment fund, it really can't be called a Madoff scheme. It is true, that the payouts were much more lucrative, back when the workers to retirees ratio was much higher. Sadly, that's true (more or less) for every pension system in the world.

In my opinion, honesty counts and terminology matters. Social Security isn't Madoff scheme or a "forced savings" system. it's just a standard PAYGO program.

It turns out that Social Security is one of the more stable PAYGO systems in the U.S. Medcare is in far worse shape (over time). Of course, low-skill immigrants are a (large) burden on Social Security and Medicare. However, the right way of looking at this is

"Low-skill immigrants are a burden on...." everything.

Alex, I agree with you that free migration and a welfare state can be compatible. You may be interested in my paper, "Is free migration compatible with a European-style welfare state?". http://www.regeringen.se/contentassets/880ac1658a944d31906ec26f9607c080/is-free-migration-compatible-with-a-european-style-welfare-state

That paper is very interesting indeed. Partly for the mindset it displays.

In the introductory chapter 1:
>"Since Swedes are not emigrating en masse in order to slash their tax bills, why should one assume that huge numbers of people from poorer countries want to move to Sweden to claim its generous welfare benefits?"

Because Sweden is a very nice place to live, and the poorer countries are not. This should be obvious. Unless you're the reborn Ayn Rand or someone similar who thinks taxes are Satan incarnate and high taxes are such a vile wickedness they cancel out every good thing about Sweden, it's completely absurd to reason from people not leaving Sweden en masse to people not wanting to enter Sweden en masse.

In chapter 2:
>"says a racist lawyer"

Because giving an example of how an unspecified person who disagrees with you is racism is totally a reasonable way to open your case in a high-level policy paper, and not an appeal to emotion more suitable for 4chan. /s

>"Borjas’s argument rests on exaggeration: he talks about subsidising “hundreds of millions” of destitute foreigners, even though such a huge flow of welfare migrants did not occur in previous decades when the US border with Mexico (and hence Latin America) was more or less open."

This is bullshit of the first degree.

Let's suppose what you are saying is true. If the border was more less open for decades, more or less everyone who wanted to come would have come, and so setting a quota based on that number of people would be more or less equivalent to open borders in the future, right? Even more so once one takes into account that Mexico isn't a static population source - once people have come from there, there are fewer people left who can come, and the ones left have been selected to be less interested in coming.

So taking your statement at face value, you've thoroughly undermined your case, because the logical implication is that a quota equal to past migration is more than enough to cover future migration. (Unless, of course, you expect future migration to rise greatly, in which case it's misleading of you to point to the fact that past migration was less-than-hundreds-of-millions.)

Of course, I think what you're saying is not true at all, and not just because you engage in rhetorical sleight of hand equating Mexico (and hence Latin America) to all the world. But I've already shown that assuming honesty proves you two-faced; there's no need for me to impugn your honor further with lengthy accusations of dishonesty here.

>"While some migrants may favour Sweden, most prefer to go elsewhere. The belief that “everyone wants to come here”, which is often voiced in each rich country, is demonstrably false. "

How about if only three billion want to come there? One billion? Five hundred million? Five hundred million split across the Scandinavian countries? How many people may want to come who haven't yet thought about the question enough to have an opinion on Sweden?

http://www.unz.com/isteve/how-many-would-emigrate-almost-7-billion-people-live-in-countries-poorer-than-us/

Your entire paper is full of blather and rhetoric.

Chapter 3 is particularly bad. It's titled "Are immigrants a burden on public finances?", a question one would expect should be argued largely with facts and figures of said public finances. But it has no numbers at all on the first page, then the lone number "40 years" on the second page. This might be reasonable in a five-hundred-page book; at halfway through a forty-page paper I expect to see a detailed breakdown of said public finances, preferably one with immigrants broken down in a way that separates Sweden's Scandinavians from Sweden's Syrians. But that might be too much to expect from the autists of the Open Borders movement for whom all humans are interchangeable economic units and the immigrant units, if anything, are superior due to their supposed selection for industriousness.

Speaking of which. In the same paper, you say both:
>"Migrants are thus a self-selected minority, who tend to be more enterprising and hard-working than most"
and:
>" In Sweden, the employment rate in 2005 among the native born was 74.6%, while among the foreign-born it was 60.7%. Unemployment was 7.9% among the native-born and 14.9% among the foreign born"
I suppose we can reconcile these by assuming that the foreign economic units are "industrious" in the same way they are "brown", as some nice characterising attribute, but one which is ultimately irrelevant because at the end of the day the attribute is not doing any work (and nor is the unit). But most people would look at this and conclude simply that the migrants are in fact not more industrious.

Admins: Preview feature, please. Or at least attach to the instructions box some indicator of the local intricacies of formatting.

I wonder what it feels like to handpick evidence to support policies detrimental to the public. Taking Soviet immigrants to Israel as a characteristic example of immigration (http://www.nytimes.com/2015/05/06/opinion/open-up-europe-let-migrants-in.html), or comparing immigrant-heavy areas (cities, growing) to areas with few immigrants (rural, stagnating).

For folks interested in "facts" rather than fantasies about immigration, try reading the following. Like it not, welfare states are immigration magnets (try turning on a TV if you don't believe this) and even immigrants who work are large, net burdens.

Sweden’s ugly immigration problem
http://www.theglobeandmail.com/globe-debate/swedens-ugly-immigration-problem/article26338254/

n Europe, refugees from Syria and Iraq have been cramming the ferry-trains heading from Germany to Denmark. But once in Denmark, many refused to get off. Where they really want to go is Sweden, where refugee policies are more generous. When the Danes said no, they hopped off the trains, and began heading toward the Swedish border by taxi, bus, and foot.

Sweden has the most welcoming asylum policies and most generous welfare programs in the European Union. One typical refugee, Natanael Haile, barely escaped drowning in the Mediterranean in 2013. But the folks back home in Eritrea don’t want to know about the perils of his journey. As he told The New York Times, they want to know about “his secondhand car, the government allowances he receives and his plans to find work as a welder once he finishes a two year language course.” As a registered refugee, he receives a monthly living allowance of more than $700 (U.S.).

Sweden’s generous immigration policies are essential to the image of a country that (like Canada) prides itself as a moral superpower. For the past 40 years, most of Sweden’s immigration has involved refugees and family reunification, so much so that the words “immigrant” and “refugee” are synonymous there (unlike in Canada).

Sweden takes in more refugees per capita than any other European country, and immigrants – mainly from the Middle East and Africa – now make up about 16 per cent of the population. The main political parties, as well as the mainstream media, support the status quo. Questioning the consensus is regarded as xenophobic and hateful. Now all of Europe is being urged to be as generous as Sweden.

So how are things working out in the most immigration-friendly country on the planet?

Not so well, says Tino Sanandaji. Mr. Sanandaji is himself an immigrant, a Kurdish-Swedish economist who was born in Iran and moved to Sweden when he was 10. He has a doctorate in economics from the University of Chicago and specializes in immigration issues. This week I spoke with him by Skype.

“There has been a lack of integration among non-European refugees,” he told me. Forty-eight per cent of immigrants of working age don’t work, he said. Even after 15 years in Sweden, their employment rates reach only about 60 per cent. Sweden has the biggest employment gap in Europe between natives and non-natives.

In Sweden, where equality is revered, inequality is now entrenched. Forty-two per cent of the long-term unemployed are immigrants, Mr. Sanandaji said. Fifty-eight per cent of welfare payments go to immigrants. Forty-five per cent of children with low test scores are immigrants. Immigrants on average earn less than 40 per cent of Swedes. The majority of people charged with murder, rape and robbery are either first- or second-generation immigrants. “Since the 1980s, Sweden has had the largest increase in inequality of any country in the OECD,” Mr. Sanandaji said.

It’s not for lack of trying. Sweden is tops in Europe for its immigration efforts. Nor is it the newcomers’ fault. Sweden’s labour market is highly skills-intensive, and even low-skilled Swedes can’t get work. “So what chance is there for a 40-year-old woman from Africa?” Mr. Sandaji wondered.

Sweden’s fantasy is that if you socialize the children of immigrants and refugees correctly, they’ll grow up to be just like native Swedes. But it hasn’t worked out that way. Much of the second generation lives in nice Swedish welfare ghettos. The social strains – white flight, a general decline in trust – are growing worse. The immigrant-heavy city of Malmo, just across the bridge from Denmark, is an economic and social basket case.

Sweden’s generosity costs a fortune, at a time when economic growth is stagnant. The country now spends about $4-billion a year on settling new refugees – up from $1-billion a few years ago, Mr. Sanandaji said. And they keep coming. Sweden automatically accepts unaccompanied minors. “We used to take in 500 unaccompanied minors a year,” he said. “This year we are expecting 12,000.”

Yet Sweden’s acute immigration problems scarcely feature in the mainstream media. Journalists see their mission as stopping racism, so they don’t report the bad news. Despite – or perhaps because of – this self-censorship, the gap between the opinion elites and the voters on immigration issues is now a chasm. According to a recent opinion poll, 58 per cent of Swedes believe there is too much immigration, Mr. Sanandaji noted. The anti-immigration Sweden Democrats party is now polling at between 20 per cent and 25 per cent.

Sweden is a cautionary tale for anyone who believes that Europe is capable of assimilating the hundreds of thousands of refugees and migrants who are besieging the continent, or the millions more who are desperately poised to follow in their wake. The argument that these people are vital to boost the economy – that they will magically create economic growth and bail the Europeans out of their demographic decline – is a fantasy.

It’s really very simple, Mr. Sanandaji explained. You can’t combine open borders with a welfare state. “If you’re offering generous welfare benefits to every citizen, and anyone can come and use these benefits, then a very large number of people will try to do that. And it’s just mathematically impossible for a small country like Sweden to fund those benefits.”

Things will get worse before they get better. As Judy Dempsey, a senior analyst at a Berlin think tank, told The Wall Street Journal, “Europe hasn’t seen anything yet in terms of the numbers or the backlash.”

Meanwhile, Sweden’s neighbour, Denmark, has cut the benefits for refugees in half, and has taken out ads in Lebanese newspapers warning would-be migrants to stay home. The Danes don’t want to be a moral superpower. They can’t afford it.

Typical Open Borders nonsense. For actual facts, we have

"In Sweden, where equality is revered, inequality is now entrenched. Forty-two per cent of the long-term unemployed are immigrants, Mr. Sanandaji said. Fifty-eight per cent of welfare payments go to immigrants. Forty-five per cent of children with low test scores are immigrants. Immigrants on average earn less than 40 per cent of Swedes. The majority of people charged with murder, rape and robbery are either first- or second-generation immigrants. “Since the 1980s, Sweden has had the largest increase in inequality of any country in the OECD,” Mr. Sanandaji said."

So who are you going to believe, the academic platitudes of P. Legrain or your own lying eyes?

I say "don't trust your eyes". Stick with faith-based economics. Open Borders is a godly mandate. Keep repeating that.

"Since Swedes are not emigrating en masse in order to slash their tax bills, why should one assume that huge numbers of people from poorer countries want to move to Sweden to claim its generous welfare benefits?"

Because they are Swedish and Sweden is their country. What a foolish question.

Perhaps the author has no country and no loyalty to any people. Perhaps he is just an opportunist.

For John and the author I believe a Philip K. Dick quote is in order

"Reality is that which, when you stop believing in it, doesn't go away"

I am not against immigration, and I think SS should go even further paying about the same amount to everyone but the sake of the truth:

For people in the bottom fifth of the earnings distribution, the ratio of benefits to taxes is almost three times as high as it is for those in the top fifth.

F,

The truth... And we are talking about immigration... Where the truth is a forbidden planet...

Is this meant to be a Straussian demonstration of mood affiliation?

hxqktEwsNLSYXzcdDk 1950

Comments for this post are closed