"Negotiable freedom" sounds like a phrase used in selling out to the enemies of liberty, when in fact it points to a fundamental feature and one of the biggest advantages of liberty.
In preparation of a conference paper, I have recently noted down these ideas:
Classical liberalism has been politically ineffective and intellectually marginalised since declining precipitously from its zenith of influence in the mid 19th century. At the same time, liberty has prospered along with the political opponents of liberalism. This constitutes the paradox of freedom, the phrase chosen for the title of our paper presented at the first X conference: “The Paradox of Freedom – F.A. Hayek and the Crisis of Liberalism.”
We have identified an inability to comprehend the role of politics and the state in a free society as the chief reason why classical liberalism has failed to marshal the popular support requisite to achieve substantial political weight.
Among the robust conditions of freedom - the conditions indispensable if feasible freedom is to be attained - is political freedom, the possibility for every citizen to participate in the political processes through which many of the most important forms of social governance are being shaped. Classical liberalism does not appreciate that the spontaneous order of politics and the state drives the future shape and meaning of liberty.
Classical liberalism is inclined to overlook the political nature of the forces and processes that define feasible liberty for two reasons in particular: [In the present post, I am concerned with only the first of the two reasons, G.T.]
Robust Conditions of Freedom – A Pool of Elements with (Re-)Negotiable Relations and Alterable Mutual Effects
In the first place, classical liberalism tends to be inspired by the presumption that liberty
(1) is rooted in a number of inalterable and non-negotiable basic premises and demands, and
(2) is to be achieved only to the extent that these fundamental precepts are being honoured in human interaction.
While it is true that feasible liberty depends on the presence of certain indispensable conditions, the latter represent nonetheless a set of features that are relational to one another, being subject to mutual trade-offs rather than absolute, complete and immutable in their meaning and implications.
Within the set of robust conditions of liberty, we address different subsets and seek different relative weightings of the relevant conditions depending on
(1) the specific nature of an issue, and
(2) the outcomes of our political handling of them.
For instance: on introducing minimum wages, we witness a stronger weighting of political freedom vis-à-vis contractual freedom. The supporters of national minimum wage laws having prevailed in the process of political legitimisation, are entitled to override certain aspects that otherwise would be protected under contractual freedom.
In a different context, say, the question of using employer resources to express one’s political preferences, there tends to be a stronger weighting of contractual freedom than political freedom, i.e. the wish of the employer not to be forced to support with his company's resources (other than indirectly by wage payments) an employee's political activism is generally protected by contractual freedom and unenforceable by appeal to political freedom.
The set of robust conditions of freedom is constantly reshuffled, whereby its elements assume different relations and proportions vis-à-vis one another, depending on the issue at hand, as well as the political acumen and dexterity of the negotiating parties.
The dynamism and negotiability of the permutations formed by the indispensable conditions of freedom is not recognised in classical liberalism. Hence a large number of policies and significant social developments based on internal trade-offs among robust conditions of freedom are perceived by classical liberals as violations of freedom.
The fact that we still enjoy high levels of freedom in societies permeated by such violations (from a classical liberal perspective) speaks to the resilience of freedom in the face of changing permutations of relative weightings among her robust conditions.
Mechanisms That Aren’t Mechanisms – But Politically Induced Outcomes
The most seminal shared heritage in classical liberal thought over a period of 300 years has a modern name: spontaneous order.
From John Locke, David Hume and Adam Smith to Friedrich Hayek, the belief that order can be achieved in human society by observance of appropriate rules rather than by authoritarian fiat is the differentia specifica of the classical liberal vision of “the good society.” This vision gives rise to an entirely new paradigm of the ideal society.
If by following the correct set of generally applicable rules we can ensure a better outcome for all members of society than by bowing down to the edicts and whims of a ruler or a ruling elite, we are faced with an entirely new model of society, one in which there is a standard by which to rationally criticise and limit the discretion of authorities; one in which, every person matters, for she is a welcome and integral part of a community whose collective compliance with rules of a certain nature produces a better world. This is tantamount to an enormous upgrading of the individual and her emancipation in a number of important aspects, not the least of which being her right to take part in the ruling of society.
The individual becomes a player in a game whose outcome is freedom. She is tied to the game through rights, individual rights. How exactly the individual is related to her rights proves contentious and decisive concerning the view one holds of liberty.
Monadic "Freedom" Versus Relational Freedom
In using subsequently the term monadic, I mean: "relating to the individual alone," as opposed to "relational, i.e. regarding the relationship between two or more individuals." In their monadic construal, rights defining liberty are absolute and inhere solely in the individual. That is, by virtue of vesting a right in the individual, it can no longer change or loose its meaning simply owing to an alteration in the relationship of that individual with other individuals. Thus, if the individual has an absolute right to contractual freedom, no circumstances can modify this entitlement, including contrary demands of political freedom.
In reality, people are forced to and often quite like to engage in a trade of the components that make up the precise and viable meaning of their rights - "I will sell part of my property to you, if you let me use the driveway you are planing to built." In fact, the insistence on the monadic nature of liberty rights (think "rugged individualism") is the reason why political freedom, the very lever of relational rights and negotiable freedom, is so poorly integrated into the world view of classical liberalism.
Spontaneous Order and Feasible Liberty
Ultimately, it is the monadic construal of liberal precepts that proves detrimental to the career of liberalism’s most basic idea: spontaneous order. The latter is thought to be a mechanism, an automatism, something that runs by itself, an "automobile" in the broadest sense of the term. But that is certainly not what the spontaneous order of a free society is.
Sure enough, there is a strong temptation to commit the fallacy of composition by taking the automatic processes of a spontaneous order, say, in the form of a reasonably free economy, to represent the whole, when it is only one aspect embedded in more formative aspects.
What is not seen is the political depth structure of the spontaneous order.
What is not seen is that the possibility for every individual to participate in negotiating the conditions of order in human interaction and a congenial negotiation process itself are core features of freedom.
What lends classical liberal recommendations an unpalatable flavour for so many people is the blanket consent they are asked to grant in too many cases and with promises painted in too broad strokes not to act by their own discretion but to stand back and await the benefits of an automatism.
Of course, the classical liberal overkill in terms of restricting political deliberateness encourages an overkill by political pragmatists in terms of dysfunctional intervention.
Risks and Costs of Liberty
Fair enough, liberal political abstention can never be the proximate cause of societal catastrophe, only excessive mal-intervention can play that role.
Though I do not think that the destruction of liberty can ever be ruled out, still in the freest countries the safeguards against such an event are substantial. But, we cannot have freedom without the costs and risks involved in living out her possibilities, which dangers are especially pertinent with respect to political freedom. For more see Costs and Benefits of Freedom.
However, if I see it right, the best we can achieve is to make the mistakes we are prone to make within (not outside!) the framework of robust conditions of freedom which strengthen and expedite our capacity of correction, recovery and renaissance.
Image credit. I am not always particularly conscious of a logical link between the images at the top of my posts and the written content underneath them, though mostly, I think, I would be able to explain some sort of association. The present picture has been chosen as an allusion to the wishful thinking underlying Bryan Caplan's immigration policy proposals. Once one assumes a certain depth of conviction, the belief system one subscribes to tends to develop a logic with its own dynamic. For instance: if you believe in advantageous spontaneous processes firmly enough, it might appear perfectly reasonable that immigration can be turned into a spontaneous order, upon which exhilarating prospect one may develop a selective fervour in search of data and theories that confirm the vision so beautifully in sync with one's dearest presumptions. I suspect, this is the psychological backdrop to Bryan Caplan's wishful thinking on immigration, in which regard it is indeed of a libertarian nature -, being, at the same time, not philosophically, but practically almost identical with Angela Merkel's recent political whim to declare Germany and Europe an area of open borders - err, to Syrians, err to who exactly is not really clear. Like Caplan, she proposes a general invitation, only to be qualified, when reality replaces rhetoric, by a mess of arbitrary ad hoc conditions.
The Indeterminacy of Immigration
In a recent post, I maintain that Bryan Caplan's libertarian take on immigration is flawed. In the meantime, I have had second thoughts as to whether it is accurate to describe Caplan's policy proposal as libertarian at all. My doubts are of a duplex nature: first, Caplan does not seem to derive his position from libertarian principles. Rather, his stance is based on a wish, namely that
unconditionally open borders ought to be recognised as
(1) a moral necessity, and
(2) a doable way of alleviating world misery superior in its outcomes both for the guests and hosts to any other outcome.
In explaining his "solution," Caplan is strangely confident in the well-functioning and benignity of the state.
Suddenly, the state is unproblematic in that host countries are not inhibited in their immigration-qua-deliverance by government-induced deficiencies that might frustrate the absorption of unlimited numbers of immigrant.
Suddenly, Caplan happily relies on government as it is to provide the kind of environment in which it is possible to easily cope with the migration of millions, perhaps even hundreds of millions of immigrants. While in all other respects the government is held to be a botcher of catastrophic import.
Suddenly, to top it all, he insists that should problems occur - a state of affairs which Caplan precludes, but toys with in a thought-experiment intended to assuage his critics - we have a state at our disposal that can be used to add any number of ad-hoc laws and policies capable of amending what difficulties may emerge.
In a word: Caplan relies on an enormous amount of confidence in the governmental status quo to be able to carry out his vision of immigration. In this sense, his proposal is hardly congenial to the libertarian or minarchist ethos, but rather of pronounced leftist pedigree - à la: since I have a good idea - which, I am sure, makes me morally superior to my opponents, - my proposition must be feasible, into the bargain.
There Is No Such Thing as a Uniquely Valid Libertarian Position on Immigration
These sceptical observations inspired in me another doubt: namely, that there cannot be any such thing as THE LIBERTARIAN POSITION on immigration.
Why not?
Consider this historic scene - borrowed from Borjas: US president Carter and Dengxiao Ping meet in the oval office - a great act of rapprochement between the US and communist China. Carter comes in heavily laden with folders documenting anti-humanitarian cases detected in China. The American president loses no time to explain his Chinese counterpart that China must not keep its population as if in a prison, and should rather open its borders, so that those unhappy with the bad state of human rights in China are free to leave the country and come to the US.
Upon this reproach, Dengxiao Ping turns pensive for a while, before suddenly a smile appears on his face, and he replies: "You are right, absolutely right, Mister President. Just tell me, how many Chinese do you plan to welcome to your country? 20 million? 50 million? 200 million? We shall be happy to oblige." And that is not even considering billions of other people living in countries with a gruesome human rights record. Little wonder, Carter quickly changed the subject.
To cut a long story short: the issue is how many people is a host nation willing to and capable of absorbing, and which people are to be invited? And what is easily overlooked: whatever decision is taken, inumerous ramifications and consequences are making themselves felt as soon
At this point, it transpires that there cannot be any such thing as THE LIBERTARIAN POSITION - as no one is able to provide us with a set of libertarian premisses that deliver a unique answer to these questions: how many people, and who to include and who not to include, subject to which conditions.
If there is not a unique libertarian answer to the question of immigration, then neither - by implication is there a state of liberty uniquely corresponding with THE right immigration policy. This holds true when we go on to admit any doctrine that claims to represent the requirements of freedom. Careful, this is not tantamount to saying that all immigration policies are equally good. What I am saying is that there cannot be any such thing as an immigration policy uniquely determined as right and indispensable in terms of this or that doctrine outlining the needs of a free society.
Freedom is more about the way in which we ought to play the game of political dissent so as to ensure we cope with the tensions inherent in political strife than it is a nucleus from which to extract determinate solutions to specific questions embodying explosive political scarcity.
Immigration is a severe case of political scarcity.
Political scarcity occurs when there is more than one way of looking at an issue that affects a group of people who are not easily persuaded to give up their differing views in order to come up with a common, a mutually agreed position. A group may be as large as the American electorate, and the number of issues that create political scarcity is infinite, while the issues are not amenable to bilateral negotiation and resolution, but require political compromise, collective decision-making, and ultimately the credible threat of coercion. Generally, the mitigation of political scarcity may be perfect in that it avoids violence, but otherwise it will tend to be regarded as rather imperfect since in a free society differences of opinion will proliferate and be allowed to prevail in the presence of a more or less transient, politically dominant compromise.
Liberalism (in all its variants) is not identical with freedom. Liberalism is a set of hypotheses, some of which are being refuted by freedom, which latter includes integrally political freedom, and hence the right of non-liberals to compete for and gain transient political dominance. Freedom is an amalgam of different political views, a fusion more or less visible in most of her institutions and policies.
Maximalist libertarian demands appear convincing only if one overlooks the nature of political freedom, which is often traded off against some of the other robust conditions of freedom - as when contractual freedom is restricted in certain cases, because the legitimate processes of political freedom authenticate a certain policy, say the minimum wage, as being entitled to transient and contestable political dominance. What is overlooked are the innumerable cases where political freedom is restricted by contractual freedom - or are you allowed to use the resources of your employer against her will to advertise the promises of communism?
The various indispensable (= robust) conditions of freedom form a pulsating cloud of interrelated particles that by affecting one another wax and wane, pulsate, stretch and contract dynamically. If one treats contractual freedom as an absolute, as opposed to a relational right that is sculpted by many interrelated forces, one misses the essential resilience of freedom and sees instead catastrophic violations of her all over the place.
No society is free from political scarcity. Freedom cannot achieve the abolition of political scarcity, she is an effort to handle political scarcity as best as we can. Her ability to manage political scarcity well is among the prime reasons to value and defend liberty.
The various "branches of government have their roles, but it's time to give us some of our government back, to embrace our heritage, and to breath life back into our constitutional system," thus argues Mark Levin, whose book "The Liberty Amendments" Ed Stevens has recommended to me to better understand the LR 35 initiative.
It seems to me an exceedingly commendable initiative, for nothing is more important than keeping the public aware of and actively participating in the constitutional framework of American politics.
You may disagree with Levin on this or that issue, or not; in any case, the initiative offers an excellent opportunity to compete politically in the context of a set of needful and constructive categories such as living federalism and true subsidiarity.
And it is recognised across party lines that we need to engage in a discussion that restores the respect for the fundamental principles of a constitutional republic:
It would seem to me that there is a difference between a well thought-through, responsible immigration and refugee policy and the wilful, wantonly negligent importation of a civilizational crisis.
Reports Steve Kates on Europe an the influx of refugees,
THE European Union has lost control of its borders and risks total collapse if they are not sealed, a senior Brussels diplomat has warned.
Donald Tusk, president of the European Council, warned the EU was now facing a “critical point” and that the migrant crisis hadn’t even reached its peak.
As he chaired an emergency meeting of EU leaders in Brussels last night Mr Tusk painted a bleak picture of the EU’s future, saying the 28-member bloc was on the verge of breakdown with “recriminations and misunderstanding” pitting nations against one another.
The future of free movement was at stake, he said, as the continent had lost control of its borders as well as a “sense of order”.
He added: “The most urgent question we should ask ourselves…is how to regain control of our external borders.
“Otherwise, it doesn’t make sense to even speak about common migration policy.”
He appeared to lay much of the blame with Germany, accusing Chancellor Angela Merkel of exacerbating the problem by sending the signal to desperate Syrians fleeing their war-torn homeland that Germany had no limit on the number of migrants it would accept.
Kearney, NE - A push for historic legislation made its way to Kearney Saturday. LR-35 would include Nebraska in a call for a convention of states. It's a way to propose an amendment to the U.S. Constitution that has never been used before. The method more commonly used is a two-thirds vote of Congress. State Senator Laura Ebke, of Crete, is leading the charge in Nebraska.
It is a fascinating initiative. I am not yet awfully knowledgeable about the details, but it does look to me like an important and most welcome move toward invigorating the constitutional debate with a much called for inclusion of the perspectives and concerns at the state level.
I am looking forward to learn more about the initiative and hope to continue to report here on its progress.
The fact that one does not like politics, the fact that one is appalled by this or that political measure, the fact that politics seems to leave a trace of jiggery-pokery and rotten compromises does not by itself justify the demand for a world without politics. Which is an irresponsible demand. For a large part of politics consists in dealing with human beings who cannot find a mutually acceptable solution.
Thus, modern politics aspires to deal with such impasses in ways that are better than forms of violent or systematically oppressive resolution. That is a welcome, honourable and most needful aspiration.
As for the recent immigration debate, Arnold Kling maintains,
The oppressor-oppressed axis [characterising the mindset of the progressives, G.T.] says that people fleeing Syria are oppressed, and anyone who would keep them out is evil.
He then advises,
Libertarians should not be so quick to align with progressives on this issue. Be as suspicious about government involvement in “solving” the crisis as you are about government’s role in enforcing borders.
Imagine the decisions about taking in Middle Easterners being made by individuals, rather than by government. That is, imagine that it were up to individual households to take them in.
Or imagine that refugee resettlement had to be funded entirely through private donations. What if the political leaders doing their moral posturing on behalf of refugees had no access to taxpayer money. Instead, suppose that they had to contribute their own money or money that they raised through private charity.
My below comment to Kling's post is concerned not with specific policy responses but with the fundamental error of libertarians who believe in solutions and policies that transcend the world of politics. It is a fundamental error to think that one can comport oneself vis-à-vis issues such as immigration in ways that preclude politics. The fact that to some all types of political outcome may appear less than satisfactory should not make us blind to the fact that a reasonably free and peaceful world depends on the solutions of an open-access political order.
Thus, I write,
The same old libertarian trick, Arnold: pretend that politics can be conjured away from our life (politics – that evil thing that may empower people who think differently from us libertarians),
and then, from the politics-free world of our imagination we can cut out a specific piece of the illusion (immigration without politics) and contrast its supposed merits with that terrible political world in which we live.
In reality: in a free society, free people will naturally and justly participate in politics and this will cause politicians to represent or pander to very different ideas concerning immigration, and these will eventually show up in government conduct.
Many of us free citizens will demand that government resources are being utilised in connection with immigration issues, as they are (or appear to be) more effective in achieving certain goals.
The demand for political solutions, whether one likes or dislikes this or that specific measure, is endogenous and natural to a free society – it is not primarily ascribable to those putatively bad types that become politicians.
The libertarian utopia of a world without politics is a red herring. In a society with millions of free (politically emancipated) people, any set of policies concerned with immigration will be highly politicised, in no small measure because the (morally/economically/philosophically) perfect solutions of those wishing for a world without politics do not exist – instead, we are forced to compete politically.
And of course, in the above post, there is no thought wasted that might look for and understand the constructive role of government in migration issues.
Even Hoppe, who opposes open borders, reverts to the help of the state (if I remember his characteristically muddled argument correctly) to keep out the intruders. He seems to sense – rightly – that if the issue were left to individual agents alone we would get highly contradictory policies and [in a anarchist world of self-justice and self-defence] still more reasons for civil strife/war (leading to the bloody rebuilding of the state).
Caplan who favours open borders prima facie, eventually goes on to qualify his initial demand for open borders with any number of ad hoc provisos which create a multi-class society that can only be enforced by the state.
Dreaming of a world without politics cannot do the intricate issue any justice.
Incidentally, however meritorious as some system of apparently consistent taxonomy, Kling's three-axes model has its problems. Beyond a certain point, it simply smacks of intellectual self-gratification.
I find it more interesting to learn from those who think differently than to congratulate myself over and over again on how neatly the world fits into the boxes I have made for it.
I find this video and the tool it introduces very useful. Of course, I don't know what the pros say. At any rate, Nebraska appears in good shape - keep it that way:
I like the below thoughts of Nebraska State Senator Laura Ebke, whose words I reproduce without having had any contact with her about the issue or my intention to publish the excerpt. The Senator responds to a person who asks her to vote according to the will of the people rather than follow her conscience.
As for the death penalty, I appreciate the sense that elected officials are not supposed to follow their own conscience, but rather the will of the people. Unfortunately, that sentiment fails to take into consideration two things:1. the difficulty of determining WHAT the will of citizens is, and ; 2. the fact that the American system of government is based on elected representatives not necessarily being direct delegates of their constituents, with specific assignments of votes for every issue, but rather being a "trustee", if you will--elected to make the best choice they can, with the information they have available.
In the case of District 32, I received a total of 112 calls and emails from unique citizens IN THE DISTRICT, on the death penalty. 56 of those contacts were FOR repeal, 56 were AGAINST repeal. How should one interpret the "will of the people" then?
It's not possible to do a scientifically dependable poll on every issue out there. Legislators try to get a sense of what their constituents want, but ultimately, have to cast the best vote they can--which yes, includes considering their own conscience sometimes. I was honest about my concern with the death penalty and my willingness to see it overturned in a survey that I was asked during the elected. Other than that survey, I had no one ask me about the issue.
Finally, I wonder if people really mean it when they say that they don't want senators to follow their own consciences and only "listen to the people." If a poll showed that a majority of the people in Nebraska wanted legalized abortion, for any reason whatsoever, up to the 30th week of pregnancy, should we listen to our conscience, or to the majority? If legislation was introduced which required the euthanasia of those diagnosed with Alzheimer's, and a majority of those who contacted us was for it, because it would save money on health care expenses, and protect family assets, should we vote in favor of that, or follow our conscience? Would voters prefer that their representatives had no personal convictions or conscience? I suspect not.
Borjas gives us both (i) a good synopsis of some of the "facts" of immigration that economists ascertain and work with, as well as (ii) valuable insights into the limits of economic analysis. While his account strikes me as honest and helpful, what resonates particularly strongly with me is the extent of ignorance that we face in looking at a phenomenon like immigration - something that comes out more graphically if you actually watch Borjas' lecture which is embedded at the bottom of this post. In the below text, however, I try to distil as much incontrovertible information as possible.
Even though we know so little for sure, "everyone" takes her position in the matter as if knowledge problems were trivial. What this suggests to me is the importance of the institutions of freedom in enabling a peaceful and socially non-disruptive debate and policy making process among uninformed and highly antagonistic members of society.
I do not think we can account for such relatively civilised conflict resolution without a theory of how political action triggers not only
primary effects - its intended procedures and aims -
but also
secondary effects that operate behind our backs as if moved by an invisible hand - the invisible hand of politics and the state.
This is ultimately, what I am striving for in looking at immigration: to better understand the part played by the invisible hand of politics. I hasten to add that I do not expect to find a self-controlling mechanism, but an order partly grown and partly designed where spontaneous processes amalgamate intricately with planned measures.
Let us now turn to some economic insights pertaining to immigration in the US:
Summary of Borjas' Lecture
Borjas' lecture starts at around time-mark 05:00 (see the embedded video at the bottom of the post).
The two core issues of immigration in Borjas view:
Time mark 07--30: How many immigrants is a host country willing to admit? (Numerical limit)
08--30: Which immigrants to you want to let in - there are billions to choose from? (Allocation system for limited number of visas)
09--00: These two core issues have never been addressed, at least since 1990.
09--15: The lecture is about looking at answers to these fundamental questions which one may garner from economic theory and empirical research, answers that we may hope allow us to replace sentiment and passion with fact-based rational insight.
10--00: 13,5% of US population was foreign born in 2010, quite in sync with similar percentages in other countries of the industrialised world.
11--45: Two peaks of US legal immigration (by decade), one around 1900, the other around 2000.
11--56: Today, roughly 1 million people entering illegally per year.
12--10: Four historical stages of US immigration policy:
Before 1875 - no restrictions
1875-1924 - defined "excludables," comprising Asians, public charges etc.
1924-1965 - national origins quotas (first time application of a numerical limit & allocation by extant proportions of national extraction (if 5% of US pop. Italians, then future eligibles again 5% Italians)
Since 1965 - family preference system (in the spirit of the civil rights movement - allocation privileging people with family connections in the US)
15--30: Contemporary classes of admission (2001 - 2010):
Legal immigrants (total) - 10.5 Mio., of which
Family-preference - 6.8 Mio.
Employment-based - 1.6 Mio (including dependants)
Refugees/asylees - 1.3 Mio
Lottery winners - 453 thousand
17--40: Illegal Immigrants (25% in California, 60% Mexicans)
2000 - 8.5 Mio.
2005 - 10.5 Mio.
2007 - 11.8 Mio.
2008 - 11.6 Mio.
2010 - 10.8 Mio
2011 - 11.5 Mio.
There is a big debate about these figures that underlines the enormous number of uncertainties lurking behind the picture we try to draw of immigration reality.
Even where data ("facts") are available, they often do not easily make for a consensus on the facts. That is before we turn to issues related to subjective perceptions and convictions.
20--50: Why we have an immigration debate in the US - zero sum assumption of economic impact.
Percentage wage gap between immigrants and native men (age-adjusted) declining from
1960 - + 5%
1970 - +- 0%
1989 - - 12%
1990 - -14%
2000 - -18%, to
2010 - -22%
21--10: Borjas:
"The fact that there has been a decline in economic performance of immigrants ... really underlies most of the questions at the core what we care about politically."
22--50: Who are the immigrants? What does economics tell us about the reasons why only relatively few immigrate (10% of all Mexicans), while the majority do not emigrate, even in the face of free movement, as in the case of Puerto Rico?
24---00: Countries with a narrow range of income distribution, like Sweden, the highly skilled have a strong incentive to emigrate, as the returns to skills are relatively low (a doctor not making much more than a bus driver); whereas with a wide distribution of income (the rich being very rich and poor very poor - and high returns to skills), the low-skilled have strong motives to emigrate, as they stand to make palpable gains in income.
25--00: Immigrants from countries with a narrow income distribution (such as Sweden) tend to perform economically much better in the US than those from countries with a high Gini coefficient (indicator of income inequality).
25--38: Another strong correlation (between economic performance of immigrants and GDP of the source country) confirms:
"Clearly, people who come from wealthier countries have skills that ... tend to be more easily transferable to the US."
26--12: Do immigrants alter the employment opportunities of natives? Talking at a time when strongly limited and discriminatory immigration policy was not contested politically, Paul Samuelson argued in 1964 - just before the 1965 change in US immigration policy:
"By keeping labour supply, down, [severely restrictive] immigration policy tends to keep wages high."
28--00: Yet again (as mentioned at 17--40), it turns out incredibly difficult to corroborate the facts (?) that seem so suggestive when applying straightforward supply-and-demand analysis. One factor complicating the issue is the dispersal of non-comparable labour markets (school drop outs in their 20s, graduates in their 40s etc.). And this includes only two differentiating criteria: education and age. Also these groups change their economic profile over the years, while new entrants appear. Trying to accommodate these factors, Borjas arrives at the following conclusion:
31--00:
For whatever reason, over the last 50 years, the groups that experience the highest influx of immigrants were the groups that experienced the slowest wage growth in that decade.
31--40: It works also the other way around, when you take out 10% members of a certain skill group (as happens thanks to emigration in Mexico or Puerto Rico, the wage levels increases.
37--45: Who gains? Who loses?
Borjas has the below figures and feels that there is distributive conflict at the bottom of immigration:
Workers lose 2.8% of GDP, or 400 billion
Employers gain 3 % of GDP, or 430 billion
Net gain is about 30 billion annually, about $ 110 per native-born person.
Flows of wealth are much greater than the net gain.
39--50: Finally, what is the fiscal impact of immigration - an American concern since 1645?
42--10: In contrast to Julian Simon - see Immigration and Freedom (1/10a)-, Borjas seems to be able to identify considerably stronger reliance of immigrants on public assistance compared to natives, implying a significant fiscal impact.
Borjas Conclusion
In view of the above finding, what should we do about immigration policy?
44--00: NOTHING AT ALL!
At least, as long as we cannot answer this question: WHAT DO WE WANT TO BE AS A COUNTRY? What do we want to accomplish by an immigration policy?
44-33: To the humanitarian, Borjas says:
The US, right now, has the biggest anti-poverty programme ever run in the entire universe through its immigration policy.
Low-skill worker wages are negatively impacted and citizens may have to pay more taxes, but if one's goal is to reduce poverty worldwide, these costs may appear worth incurring.
Putting on the hat of the tax payer, who only cares about his income and his retirement, Borjas, wonders why should I make sacrifices to support a 33% dependency rate in immigrants?
46--17:
Same facts, but different objective functions, lead to very different immigration policies.
Man cannot live by facts alone [if we can bring ourselves to share common facts]. Qua economist, one is not in a position to recommends policies. Before one can take a meaningful stand on immigration, one needs to insert additional substantive content (representing, for instance, humanitarian ambition or taxpayer interests) whose determination is not the business of the economist.
Be this as it may, countries do tend to erect admission hurdles, frequently by using a point system, which in the US is implicitly operative by the fact that people with US family connections ipso facto score heavily, while Canada screens with its point system for likelihood of economic success.
Establishing a point system raises the core issue as to what it is that you wish to attain with an immigration policy, which objectives do you wish to foster?
52--00:
Policy implications do not come from facts alone ... Whose well-being do you want to maximise? What do you care about?
And:
It is very difficult to come up with an immigration policy that makes all three groups better off (natives, immigrants, and those that are left behind) ... You have to allocate weights to different groups. The allocation of weights is what the objective function is about and what in the end the immigration policy is about.
Yet, attaching weights to specific groups is a practice that conflicts with cultural preferences that have become dominant in Western countries.
My Conclusion
One might surmise that in a free society, we will tend to encounter a policy mix geared among other things to disparate types of policy-consumers, each policy signalling compliance with the specific demands of a targeted group influential enough to receive placating signals.
To the extent that contradictory or incoherent policies have detrimental effects, these must be counted as costs of liberty.
The costs of liberty are the costs generated by a regime that
allows dissent on all (including explosive) issues, and therefore simultaneously
faces a heightened need to safeguard social cohesion
in a social order whose overall success hinges vitally on accommodating a highly disputatious community with relatively low barriers to political influence by any citizen ambitious to make an impact.
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