Admitting immigrants legally for the benefit of American society need not be bureaucratically demanding. The existing H-1B visa program could fairly easily be turned into a merit system. It would require only minor tweaking. The main tweak would be to forbid or, at least, to restrict severely employers’ reliance on labor contractors through which most of the abuses occur, I believe. (See, for example, the infamous Disney case, described below.) Let each employer applying for such visas be squarely on record as vouching for the individual beneficiaries’ quality.
Following the example of Canada, some degree of priority could be assigned to obvious contributions to successful adaptation to American society, beginning with knowledge of English. (This might actually require a new law making English the official language of the US.) I listed above other examples of immigrants features that might be scored positively. Note again that avoiding the drawbacks of a completely relative-based system does not necessarily imply the rejection of the simple idea that having relatives in the country often facilitates adjustment. Within the framework of a H-1B-type point system, some degree of preference could be assigned to the fact that the beneficiary has relatives in the US close to where he will first settle. This would not be family re-unification under a different guise because family relations would be subordinate to work capabilities and other features facilitating adaptation.
The next necessary tweak has to do with the fact that the H-1B program has a bad reputation among the unemployed and the uncertainly employed. So, in 2016, the Walt Disney company was sued, famously for having American workers train their F-1B visa replacements before they were laid off. The suit was dismissed by reason of what I think was a big loophole in the protective measures in favor of American workers in connection with the H-1B program. No one denied that Disney had done what it was accused to have done. Many believe furiously that the program actively discriminates against American workers and keeps their wages low. To make it more acceptable, the existing H-1B safeguards against noxious practices undermining the employment of the American-born and of legal resident immigrants would have to be widely publicized and remedies against abuses would have to be made judicially more accessible than they are now.
The American public would also have to be ready for the predictable consequences of merit policies in terms of culture and in terms of politics. The merit-based program I envisage would result quickly in a large increase in Indian immigration. Although Indians have been very good immigrants by most counts, there might be objections because nearly all of them seem to suck some form of leftism or other with their mother’s milk. In addition, and although India is often celebrated as the “world largest democracy,” there is some question about educated Indians’ attachment to the constituent forms of historically Western democracy, specifically. (I am a small-time expert on this because I read items in and through the Indian press and because I have Indian relatives. They are a tiny biased sample, of course but also an informational gateway of sorts. See also India-born commentator Jayant Bhandari in the October 5 2017 issue of Acting Man: “Canada: Risks of a Parliamentary Democracy.”)
This problem and others like it could be mitigated by placing a numerical ceiling on the total number of immigrants from any one country. I predict informally that this particular problem would turn out to be limited because, once the gates of legal immigration opened for real, there would be a sharp increase in applications from European countries with democratic systems similar to ours. This too would have consequences: As I have pointed out, by and large Europeans are not shy about using any form of welfare, broadly defined, including unemployment benefits. I note shyly that placing a ceiling on the contribution of any one nation-state to US immigration would seem “fair” to liberal opinion, making the whole project more acceptable than would otherwise be the case.
Incidentally, a reasonable merit-based system, aimed as it would at foreigners of some competence, might produce additional revenue to help defray both the cost of better enforcement of immigration laws, and the cost of caring for people admitted on altruistic grounds.
[Editor’s note: in case you missed it, here is Part 18]
In his October 2006 article in Liberty, (“Immigration: Yes, No, and Maybe” by Richard Fields, Stephen Cox, and Bruce Ramsey), Cox tries to summarize the net cost that (then) current immigrants impose on American society by working out a quantitative example. He stages an imaginary but realistic (Mexican) immigrant family of five living in Los Angeles – two parents and three minor children. He assigns reasonable earnings to the parents and sets those against the probable costs that the whole family imposes in the form of normal local and other services. He arrives at the conclusion that the family annually costs American society 38,900 2006 dollars. (I agree with Cox that this may be a conservative estimate. That would be about 48,000 June 2018 dollars, using the CPI Inflation Calculator of the Bureau of Labor Statistics).
To gauge the real magnitude of the overall normal costs legal immigrants thus impose on American society, let’s suppose further that all of the 2016 legal immigration is composed of Cox’s families of five. That’s 240,000 such families. The aggregate excess of their social costs over their earnings is 48,000 x 240,000 = 11.52 billion dollars. As a percentage of 2016 GDP, this figure is less than 7/10,000 (seven over ten thousand – 2016 GDP from CountryEconomy.Com).
Now, let’s suppose that Cox was too conservative by one half in his estimate of the cost his family imposes on American society. This would imply that the legal immigrant families that compose all of 2016 immigration cost American society an amount that is like 14/10,000. The numerator in this last estimate includes only legal immigrants. Let’s suppose further that the number of illegal immigrants for the year of reference equals the number of legal ones and that they cost the same and contribute the same as legal immigrants. The cost that all immigrants impose on American society is then approximately 28/10,000 or about 1/3 of one per cent of GDP. If you assume that illegal immigrants earn only half as much as legal immigrants, the net cost of immigration overall goes up correspondingly. It’s still not much. My point is this: In the worst case scenario I can conjure, the net cost that immigrants impose on American society is very low. It’s of the order of 12 million Americans buying a $10 lottery ticket at Nine/Eleven every payday.
This is still certainly an overestimation, for two reasons. One, this scenario is the extreme, limiting case. There is, of course, zero chance that the total legal immigration in any one year is composed entirely of the kind of families of five Cox describes. Among the immigrants, as with nearly all immigration everywhere, there must be a preponderance of healthy young men and young women without children. This happens through self-selection: emigration is very difficult. It requires courage and even a solid dose of unrealism; children are a big impediment in this respect. But, in most cases, younger people without children must easily contribute more than they cost American society because they land all raised up and ready to work (as I said). The exceptions concern those who fall seriously sick– uncommon among the young – and those who end up in jail or prison. The latter is not a rare occurrence among the young in general, among young males in particular. As I said, I deal below with the particular cost of incarcerating immigrants.
The other imaginary limiting case is this: Among the 1,200,000 immigrants in 2016, there is a single family of five as described by Cox and the balance is made up of vigorous young women and young men who never become sick and never transgress the law. In that other limiting case, immigrants are almost certainly a net economic boon to American society. I don’t know where the reality lies and it may change from year to year. It’s doable research which, I think, has not been done.
The second reason why the figure of 28/10,000 is probably an overestimation, or why it leads to fallacious inferences, has to do with life cycles. First, there will probably be a period during the family’s life when the children will be grown and capable of working while the parents themselves are working, undisturbed by family obligations. During that period, three or four, or all five immigrants will in all likelihood contribute more than they take from American society, in spite of their low qualifications. This sweet spot may vanish when the parents reach Medicare and Social Security age. In the meantime, several family members will have contributed to the relevant social funds; one or more of the children will too, probably for 30 years or more. Hence, whether the family of five receives a net benefit or impose a net cost over a longer, trans-generational period depends on actuarial calculations that neither Cox nor I have performed.
I hasten to add that it’s quite possible that such actuarial calculations, performed with real numbers, would still show the five in my chosen family as perpetrating a net cost on American society. To be thorough, one would have to take into account two more things. One is the possibility that one of the three children will turn out to be a great, outsize contributor, like the 40% American Nobel Prize winners born abroad. Or all three. The relevant reasoning has to be trans-generational to some extent, it seems to me. Just look at the extreme imaginary scenario below.
For ten years in a row, the US admits as many immigrants as it did in 2016. That’s 12 million immigrants. Let’s assume none dies during that period and they have no children (We will see that this unrealistic assumption does not matter here.) Not one of the twelve million is able to pay his full fare. On the average, they each cost American society $20,000 there is no chance they will ever pay back, one way or another. However, one of these hapless immigrants is Steve Job’s biological father. You know the rest of this true story. Ask yourself: If it were your decision, knowing this and, and based solely on economic matters which are the stake here, would keep out all twelve million?
This quandary poses an interesting conceptual problem we keep encountering: Had Job’s biological father not accidentally made his girlfriend pregnant; had they not decided to give Steve up for adoption, would someone else have developed the personal computer with Wozniak? Without him? Would you bet on it? The truth is that American society is unusually inventive but it’s probably not the most inventive on a per capita basis. (Last time I looked, the Japanese were registering more patents than Americans – that’s per capita.) It’s also seems true that immigrants account for a disproportionate number of American innovations, including 40% of all Nobel prizes in other than literature. (And also excluding the often farcical Nobel Peace Prize.) It’s not absurd to think of American inventiveness as the happy encounter of American institutions unusually favorable to innovation with immigrant vigor. This is just a speculation, of course but how willing are you to discard it summarily?
Finally, the calculation of immigrants’ net burden imposed on American society necessarily fails to take into account real positive contributions that are difficult to quantify, more or less intangible contributions, some of which I have mentioned elsewhere. They go from Italian cuisine to my own ability to interpret some world events better than almost any native-born professor. Here is another mental experiment: Suppose a national society decided, through some process or other, to bring up the average quality of its every day food from, say English levels, to 1/3 of Italian level. The cost would be astronomical and the result would clearly constitute a significant improvement in the quality of Americans’ every day life – which is what the science of Economics is all about, of course. My point is that the fact that this felicitous result was achieved through the happenstance of immigration does not imply that its societal value is zero.
One of the highest per capita expenditures that immigrants–like every other population group over and below a certain age–impose on American society is the cost of incarceration. That cost is also mostly borne by state and local authorities, although there exists a process by which the federal government reimburses local governments for illegal immigrants incarcerated for crimes other than illegal border crossing (explained in Cox 2006). I examine below the tangled issue of the cost of immigrant incarceration.
[Editor’s note: In case you missed it, here is Part 4]
Stay tuned for more on India from a sub-state perspective. I’m going to find the GDP (PPP) per capitas of these states. I’m going to find their population densities. I’m going to find their literacy rates and their life expectancy rates. I’m going to find out much more about India over the coming 12 to 16 months.
Around early August 2018, a research paper from the Mercatus Center at George Mason University by Charles Blahous made both the Wall Street Journal and Fox News within two days. It also attracted attention widely in other media. Later, I thought I heard sighs of satisfaction from conservative callers on talk show radio whenever the paper came up.
One figure from the study came and stayed at the surface and was quoted correctly many times (rare occurrence) in the electronic media. The cost of what Senator Sanders proposed with respect to national health care was:
30 trillion US dollars over ten years (actually, 32.6 over thirteen years).
This enormous number elicited pleasure among conservatives because it seemed to underscore the folly of Senator Bernie Sanders’ call for universal healthcare. It meant implicitly, federal, single-payer, government-organized health care. It might be achieved simply by enrolling everyone in Medicare. I thought I could hear snickers of relief among my conservative friends because of the seeming absurdity of the gigantic figure. I believe that’s premature. Large numbers aren’t always all they appear to be.
Let’s divide equally the total estimate over ten years. That’s three trillion dollars per year. It’s also a little more than $10,000 per American man, woman, child, and others, etc.
For the first year of the plan, Sanders’ universal health care amounts to 17.5% of GDP per capita. GDP per capita is a poor but not so bad, really, measure of production. It’s also used to express average gross income. (I think that those who criticize this use of GDP per capita don’t have a substitute to propose that normal human beings understand, or wish to understand.) So it’s 17.5% of GDP/capita. The person who is exactly in the middle of the distribution of American income would have to spend 17.5% of her income on health care, income before taxes and such. That’s a lot of money.
Or, is it?
Let’s imagine economic growth (GDP growth) of 3% per years. It’s optimistic but it’s what conservatives like me think is a realistic target for sustained performance. From 1950 to 1990, GDP per capita growth reached or exceeded 3% for almost all years. It greatly exceeded 3% for several years. I am too lazy to do the arithmetic but I would be bet that the mean annual GDP growth for that forty-year period was well above 3%. So, it’s realistic and probably even modest.
At this 3% growth rate, in the tenth year, the US GDP per capita will be $76.600. At that point, federal universal health care will cost – unless it improves and thus becomes more costly – 13% of GDP per capita. This sounds downright reasonable, especially in view of the rapid aging of the American population.
Now, American conservative enemies of nationalized health care are quick to find instances of dysfunctions of such healthcare delivery systems in other countries. The UK system was the original example and as such, it accumulated mistakes. More recently, we have delighted in Canadian citizens crossing the border for an urgent heart operation their nationalized system could not produce for months: Arrive on Friday evening in a pleasant American resort. Have a good but reasonable dinner. Check in Sat morning. Get the new valve on Monday; back to Canada on Wednesday. At work on the next Monday morning!
The subtext is that many Canadians die because of a shortage of that great free health care: It nice if you can get it, we think. Of course, ragging on the Canadians is both fair and endlessly pleasant. Their unfailing smugness in such matters is like a hunting permit for mental cruelty!
In fact, though, my fellow conservatives don’t seem to make much of an effort to find national health systems that actually work. Sweden has one, Denmark has one; I think Finland has one; I suspect Germany has one. Closer to home, for me, at least, France has one. Now, those who read my blogging know that I am not especially pro-French or pro-France. But I can testify to a fair extent that the French National Healthcare works well. I have used it several times across the past fifty years. I have observed it closely on the occasion of my mother’s slow death.
The French national health system is friendly, almost leisurely, and prompt in giving you appointments including to specialists. It tends to be very thorough to the point of excessive generosity, perhaps. Yes, but you get what you pay for, I can hear you thinking – just like a chronically pessimistic liberal would. Well, actually, Frenchmen live at least three years longer on the average than do American men. And French women live even longer. (About the same as Canadians, incidentally.)
Now, the underlying reasoning is a bit tricky here. I am not stating that French people live longer than Americans because the French national healthcare delivery system is so superior. I am telling you that whatever may be wrong with the French system that escaped my attention is not so bad that it prevents the French from enjoying superior longevity. I don’t want to get here into esoteric considerations of the French lifestyle. And, no, I don’t believe it’s the red wine. The link between drinking red wine daily and cardiac good health is in the same category as Sasquatch: I dearly hope it exists but I am pretty sure it does not. So, I just wish to let you know that I am not crediting French health care out of turn.
The weak side of the French system is that it remunerates doctors rather poorly, from what I hear. I doubt French pediatricians earn $222,000 on the average. (Figure for American pediatricians according to the Wall Street Journal 8/17/18.) But I believe in market processes. France the country has zero trouble finding qualified candidates for its medical schools. (I sure hope none of my current doctors, whom I like without exception, will read this. The wrong pill can so easily happen!)
By the way, I almost forgot to tell you. Total French health care expenditure per person is only about half as high as the American. Rule of thumb: Everything is cheaper in the US than in other developed countries, except health care.
And then, closer to home, there is a government health program that covers (incompletely) about 55 million Americans. It’s not really “universal” even for the age group it targets because one must have contributed to benefit. (Same in France, by the way, at least in principle.) It’s universal in the sense that everyone over 65 who has contributed qualifies. It’s not a charity endeavor. Medicare often slips the minds of critical American conservatives, I suspect, I am guessing, because there are few complaints about it.
That’s unlike the case for another federal health program, for example the Veterans’, which is scandal-ridden and badly run. It’s also unlike Medicaid, which has the reputation of being rife with financial abuse. It’s unlike the federally run Indian Health Service that is on the verge of being closed for systemic incompetence.
I suspect Medicare works well because of a large number of watchful beneficiaries who belong to the age group in which people vote a great deal. My wife and I are both on Medicare. We wish it would cover us 100%, although we are both conservatives, of course! Other than that, we have no complaints at all.
Sorry for the seeming betrayal, fellow conservatives! Is this a call for universal federal health care in America? It’s not, for two reasons. First, every country with a good national health system also has an excellent national civil service, France, in particular. I have no confidence, less than ever in 2018, that the US can achieve the level of civil service quality required. (Less in 2018 because of impressive evidence of corruption in the FBI and in the Justice Department, after the Internal Revenue Service).
Secondly, when small government conservatives (a redundancy, I know) attempt to promote their ideas for good government primarily on the basis of practical considerations, they almost always fail. Ours is a political and a moral posture. We must first present our preferences accordingly rather than appeal to practicality. We should not adopt a system of health delivery that will, in ten years, attribute the management of 13% of our national income to the federal government because it’s not infinitely trustworthy. We cannot encourage the creation of a huge category of new federal serfs (especially of well-paid serfs) who are likely forever to constitute a pro-government party. We cannot, however indirectly, give the government most removed from us, a right of life and death without due process.
That simple. Arguing this position looks like heavy lifting, I know, but look at the alternative.
PS I like George Mason University, a high ranking institution of higher learning that gives a rare home to conservative American scholars, and I like its Mercatus Center that keeps producing high-level research that is also practical.
- What caused the Black Death and could it strike again? Wendy Orent, Aeon
- Which cities have people-watching street cafes? Tyler Cowen, Marginal Revolution
- Keenan’s view of the Far East Francis Sempa, Asian Review of Books
- Is neoliberalism dead? Scott Sumner, EconLog