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Open The Borders

Posted on November 10, 2009
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Michael Maiello, 11.09.09, 12:01 AM ET

There are too many houses and too many unleased offices, empty storefronts and vacant apartments. Too many factories sit idle, and if you sit quietly in some empty cubicles you’ll hear the faint haunting sound of a YouTube video surreptitiously played there long ago. Too many airplanes rust away in fields out west. Meanwhile consultants roam the land telling employers to trim corporate fat and create even more idle resources.

America has too few people and too many consultants.

The obvious answer is to open America’s borders to any immigrant who wants to live here for more than five years. Permanent residency and full citizenship should be available for the asking, provided the newcomers haven’t committed any major crimes while living and working here (victimless crimes and crimes against consultants, sorry for the redundancy, should be forgiven).

The common understanding of the recession is just wrong. We talk about the Federal Reserve and punch bowls as if any economic expansion is like a party, any party will get out of control and every good night involves a hangover the next morning. But if you really want to apply the party metaphor to America right now, the bar is fully stocked with ice and top-shelf liquor, there’s a buffet going to waste, there’s a great D.J. and for the life of us we can’t get Lindsay Lohan and her friends to come trash the place. We’re throwing a great party for an empty room. In econospeak: we’re only using 75% of our economy’s productive capacity when we should be using at least 90%. Why? Lack of demand. Where does demand come from? People. We need people.

Especially immigrants. People don’t move because it’s fun to have yard sales and carry boxes. They move in search of a better standard of living. For all our problems, the U.S. still has a great standard of living and we’re still an attractive destination. Let’s get some people over here and get them into some empty homes. Let’s help them set up shops in empty storefronts. Let’s get people here to shop, work, buy and pay taxes. It will solve all of our problems.

OK, two obvious issues here. One is that unemployment is rising, so a larger labor force could compound the problem. The other is that wages are falling, also not much helped by a larger labor force. You basically have to face those two risks and hope they take care of themselves. Unemployment hit 10.2% as the demand-driven retail sector cut jobs. If you want more jobs, you need more demand, and for that you need more people–especially immigrants on a mission to live better through higher materialism. It might be best to recruit immigrants from Ukraine and Russia, because they like to shop in SoHo.

The wage issue would be solved over the long run by encouraging immigrants to take up permanent residence in the U.S. The real downward pressure on wages comes from transient workers trying to make whatever they can to either send or take back home. Permanent workers who want to live here, and to live better as every year goes by, should be able to demand higher wages as time goes on. Heck, maybe some of this new labor would even organize.

To further encourage permanent residency, we should offer citizenship to anyone who qualifies for an H1-B visa. This program is for temporary workers with special skills (usually in the technology sector) and has been criticized by some in the tech industry as a way for U.S. companies to outsource without all the hassles of actually managing a project overseas. But it’s one thing to come here on finite contract to work for low wages by U.S. standards but high wages by the standards of your home country. It’s quite another to come here permanently. The standard wage back home doesn’t matter when it’s not home anymore.

Besides, the more super-smart and creative citizens we have, the better off we are, right? We should absolutely drain the world of its intellectual resources. Isn’t the mere existence of Dancing With The Stars proof that our collective cerebral capacity utilization is about as bad as our industrial capacity utilization?

Another objection to free immigration might be that everyone won’t necessarily speak English. But you’ll need to take that up with some one who doesn’t live in New York.

Then there’s the security issue. The U.S. has not been as friendly a place for foreign visitors or immigrants as it once was. This is one of the reasons that Barack Obama lost his Olympic bid. There’s no doubt that by trying to keep ourselves safe from foreign terrorists we’ve deterred too many good-willed immigrants. It’s time to let the pendulum swing back a bit–our security measures are imperfect and always will be, so we should concentrate on other priorities.

A growing and prosperous immigrant population will do more than fill empty houses, bring dormant factories back to life and spend office hours sneaking looks at YouTube videos. They would also form a new base of income and property-tax payers, solving the crisis in state and local budgets and cutting into federal deficits as well.

By encouraging long-term residency we’ll also put a dent in (if not outright eliminate) the demographic problems facing Social Security and Medicare. One way to solve the “too few workers paying for too many retirees” problem is to get more workers born. That’s a bit silly in a world full of people. We can just attract more workers to live here.

Ironically, recessions are terrible for immigration. H1-B visa requests are down. Traffic from Mexico is down. Resentment against immigrant workers is up. But this is really the answer to all of our problems. Come one, come all. Actually, come all. Just leave your consultants at home.

Michael Maiello is editor of Markets and Intelligent Investing at Forbes.

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