What Are The Pros And Cons Of Open Immigration In The 21st Century
INTRODUCTION Immigration in the 21st Century: Pros and Cons In light of the recent September 11th terrorist attacks on the World Trade Center and the Pentagon, there has been a widespread resultant paranoia in the American psyche. Amongst one of the ?preventive measures? to curb further terrorist activities, the American immigration policy was scrutinized upon intensely. Long-time skeptics of immigration, including former presidential candidate Pat Buchanan and the Federation for American Immigration Reform, have tried in recent days to turn those legitimate concerns about security into a general argument against openness to immigration. However, what these immigration skeptics failed to see is that terrorist activities and immigration are two different issues altogether and should not be linked under any circumstance. In this essay, this issue will be discussed in addition to the broader topic in this regard: why the United States should keep its traditional policy of open immigration.
REALITY CHECK Amongst the anti-immigration stalwarts, the primary argument is that continual immigration at the present pace would bring economic woes to this country, particularly in the case of labor competition and wages. However, based on the testimony before the Senate …show more content…
Judiciary Committee (Subcommittee on Immigration) on April 4th, 2001, Stephen Moore, Senior Fellow in Economics of Cato Institute, these claims are unjust if not unfounded. Based on the anti-immigration advocates claims, the current level of immigration would lead to such economic problems as: 1) increased unemployment for native born workers; 2) higher poverty rates of native born Americans; 3) lower incomes for American workers; 4) increased economic problems for minority workers; 5) a huge surge in welfare dependency; and 6) lower overall rates of economic growth. Nonetheless, the evidence thus far cannot substantiate such assertions.
Unemployment - In the period 1978-82 the U.S. unemployment rate was between 6 and 8%. Today, the U.S. unemployment rate is between 4 and 5%. The U.S. economy has shown a remarkable ability to absorb new workers into the economy?both natives and immigrants?without causing job losses. Between 1980 and 2000 the U.S. became a job creation machine, with some 35 million more Americans employed today than 20 years ago. The U.S. has created more new jobs in the past 20 years than all of Japan and Europe combined since 1980. In fact, despite the fact that the U.S. takes in nearly as many immigrants in a year as does all of Japan and Europe combined, it is the U.S.?the nation of immigrants?that now has the lowest unemployment rate in the industrialized world.
Poverty - The poverty rate for Americans has fallen over the past 20 years for all races. The latest poverty rate statistics indicate that poverty is lower than at anytime since the mid 1970s. See Figure 4. A recent study by the Center of Immigration Studies reports that since 1980 the rate of poverty among immigrants has risen. Of course, if the overall level of poverty has fallen during this period, it means that the reduction in poverty for native-born Americans has been all the more impressive. In sum, there is no evidence that immigrants increase poverty among natives, in fact the evidence suggests the opposite effect.
Incomes - Median family income in the U.S. has risen over the period 1981-1998 from $39,000 to $45,800 or by roughly 16 percent, according to recent Census Bureau data. With inflation properly measured, median family income has risen since 1981 by closer to 25 percent. Again, wage suppression does not appear to have occurred in this period of high immigration.
Economic Advancement of Minorities - There is still in America far too wide an income gap between the races. But over the past 20 years of high levels of immigration, the income gap has actually shrunk, not widened. For example, since the early 1980s, the growth of incomes for black families has exceeded the growth for white families. The black unemployment rate has much fallen faster than the white unemployment rate, as has the black poverty rate. The income gap between blacks and whites and between men and women has narrowed to its lowest level in recorded history. From 1981 to 1998, the black incomes relative to whites shrunk from 60 percent to 69 percent--the highest ever recorded. For women, the gap narrowed from 89 percent to 94 percent. In sum, we have had record immigration and we have had record economic improvements for blacks.
IMMIGRATION AND WELFARE Another argument used in favor of immigration controls concerns the American welfare system and its potential abuse by immigrants who migrate into America merely to feed at the public trough of social services. The claim is made that the welfare system, not potential economic freedom, is the lure which draws immigrants into the American economy. Immigrants -unproductive, slothful, and indigent - constitute a dead-weight loss on the American economy, and further increase the tax burden on productive Americans. Therefore, we must police our borders and keep out the undesirables.
This argument is statistically and theoretically flawed. Contrary to prevailing public opinion, current immigrants do not "abuse" the public welfare system, even in the areas where immigration (legal or illegal) is most concentrated. In fact, immigrants have little effect on the current system of taxation and wealth redistribution. As Julian Simon relates: Study after study shows that small proportions of illegals use government services: free medical, 5 percent; unemployment insurance 4; food stamps, 1; welfare payments, 1; child schooling, 4. Illegals are afraid of being caught if they apply for welfare. Practically none receive social security, the costliest service of all, but 77 percent pay social security taxes, and 73 percent have federal taxes withheld. ... During the first five years in the United States, the average immigrant family receives $1404 (in 1975 dollars) in welfare compared to $2279 received by a native family.
IMMIGRATION AND CULTURE A final argument against immigration comes surprisingly from those generally supportive of liberty and the philosophy of the limited state. These critics are concerned for the preservation of what they see as a distinct American culture and its traditional heritage of European-style limited government and market economies. Their fear is that this traditional culture is being sabotaged by an influx of immigrants who are unfamiliar with and perhaps even hostile toward its institutional framework.
There is another flaw lurking in the argument that open immigration leads to the decline of a nation 's cultural and institutional framework. Contrary to the anti-immigration position, the American traditions of limited government and free market economies are not based upon ethnic or racial origins. They are based upon ideas. Western cultures cannot suppose themselves to have a monopoly on the philosophy of liberty, nor can Americans argue that the political values of the limited state cannot be inculcated in non-American immigrants. The ideas of freedom that have created the American tradition can apply to any ethnic or racial make-up.
The answer is to return once again to a government "of laws and not of men." In other words, the state must be radically limited in power and scope, with only minimal duties which are explicitly defined. This will put state power beyond the reach of those individuals or voting blocs that would seek to exploit it for personal gain. We then would have no reason to fear immigrants, regardless of their ideological or political persuasion. Their ability to " sabotage" our freedoms would be removed not because we expand state power to keep them out, but because we diminish state power in all areas and allow them in.
ECONOMIC BENEFITS BROUGHT BY IMMIGRANTS What can we conclude about the impact of immigration on the U.S. economy since 1980? Over the past 20 years the U.S. economy has experienced a $10 to $15 trillion increase in net wealth, according the Federal Reserve Board data, the GDP has grown by nearly 80 percent (after inflation), and the inflation rate has fallen to nearly zero. The National Bureau of Economic Research recently described the past 18 years as the longest and strongest period of sustained prosperity in the U.S. in this century. If immigrants are somehow a "cost" to the U.S. economy, that cost has been virtually invisible. The experience of the past two decades puts a huge burden on the shoulders of those who contend that immigrants are economically burdensome. Again, based on the testimony of Stephen Moore, these are his findings: 1. Immigrants and their children increase economic growth. In the most comprehensive study ever conducted on immigration, the National Research Council of the National Academy of Sciences found that immigrants inflate the incomes of U.S.-born workers by at least $10 billion each year. This estimate is highly conservative because it does not include the impact of immigrant-owned businesses or the impact of high-skilled immigrants on overall productivity. Still, the NRC estimates that the typical immigrant and his or her children pay an estimated $80,000 more in taxes that they will receive in local, state and federal benefits over their lifetimes.
2.
Immigrants pay their own way when it comes to services used and taxes paid. Immigrants use many government services?particularly at the state and local levels--but they are also pay a lot in taxes. Conservatively estimated, in 1998 immigrant households paid an estimated $133 billion in direct taxes to federal, state and local governments. Adding the tax receipts paid by immigrant businesses brings the total annual tax contributions of immigrants to about $162 billion for 1998. In any given year, immigrants may use more in services than they pay in taxes, but over their lifetimes, immigrants are a fiscal bargain to native taxpayers. As their earnings rise over time, immigrant taxes exceed the benefits
received.
3. Immigrants have a rapid rate of economic assimilation after they arrive in the U.S. As noted above, one of the most important economic characteristics of immigrants is that their earnings rise over time in the U.S. Hence, during their first years after arrival in the U.S. earnings are low and immigrants typically are net drains on the public coffers. But over time--usually after 10-15 years in the U.S--they turn into net contributors. This economic assimilation pattern varies by ethnicity and country of origin, but is still evident today as it was 30 years ago when researchers first began to study the rate of economic success by immigrants over time. We also this economic assimilation when it comes to poverty rates, unemployment, and home ownership.
4. The age profile of immigrants is a huge demographic bonus to native-born Americans. Most immigrants arrive in the United States in the prime of their working years. For example, more than 70 percent of immigrants who come to the U.S. are above the age of 18 upon arrival. This means that there are roughly 17.5 million immigrants in the U.S. today whose educational and rearing costs were borne by the citizens of the sending country, not American taxpayers. They were educated elsewhere. The total discounted present value windfall to the United States of obtaining this human capital at no expense to American taxpayers is roughly $1.43 trillion. Immigration can be thought of as an enormous $1.4 trillion transfer of wealth from the rest of the world to the United States.
5. Immigrants are huge net contributors to the Social Security and Medicare programs. Only 3 percent of immigrants enter the U.S. over the age of 65, whereas 12 percent of Americans are over 65--and that percentage will grow to 15% within 20 years. Based on the calculations of the actuaries at the Social Security Administration, this study estimates the total value to the Social Security system from current levels of immigration. The total net benefit (taxes paid over benefits received) to the Social Security system in 1998 dollars from continuing current levels of immigration is nearly $500 billion from 1998-2022 and nearly $2.0 trillion through 2072. Continuing immigration is an essential component to solving the long term financing problem of the Social Security system.
6. Immigrant entrepreneurs are a major source of new jobs and vitality in the American economy. Most immigrant businesses--like most businesses started by American-born entrepreneurs--are not highly successful or large employers. But many of America 's largest and most profitable businesses in today were started by immigrants. Immigrants who entered the U.S. as refugees, economic immigrants, or family-sponsored immigrants are now at the helm of some of the nation 's leading and rapidly growing technology businesses: Hungarian-born Andrew S. Grove, recently retired as Chairman and CEO of Intel. Taiwanese immigrant John Tu co-founded Kingston Technology, a computer-memory-module maker in 1987. When he sold an 80 percent interest in the company in August 1996, it had annual sales of $1 billion. Algerian-born Eric Benhamou, heads 3Com Corp. Iranian-born brothers Farzad and Farid Dibachi founded and heads Diba, Inc. The income and employment generated by 10 highly successful immigrant firms. These 10 firms alone generated $28 billion in revenues and employed 75,000 American workers in 1997. The tax revenues paid in 1997 by the companies directly and their employees was at least $3 billion.
IMMIGRATION AND LABOR ISSUES Immigration?s impact on the American labor?s competitiveness and wages is perhaps the most contentious issue in the whole immigration debate. Many Americans argue that free immigration would destroy "working class" Americans ' ability to earn a living. They claim that allowing free and open borders to any and all immigrants would put decent, hardworking Americans out of work. Perhaps what these Americans really fear, however, is that someone will emerge from the "immigrant class" who would be willing to work for less than they while producing equal or greater output.
Displaced workers, along with others who fear for their livelihood, are fertile ground in which to sow anti-immigrant sentiment, since angry and frustrated people often seek some target on which to blame their problems. The right wing has organized and manipulated such anger and resentment, turned it away from corporations, and directed it against the government, decrying high taxes and the inability of the state to solve problems such as social deterioration, homelessness, crime, and violence. In addition to the target of "failed liberal policies," immigrants make a convenient scapegoat and a very tangible target for people 's anger. Racial prejudice is often an encoded part of the message.
However, a policy of open immigration would indeed force unskilled American laborers to compete for their jobs at lower wages. However, far from being an evil, this is a desirable outcome, one that should form the basis for a new immigration policy. By inviting competition into the American labor markets, artificially inflated labor costs could be eliminated and a greater level of labor efficiency could be achieved.
As the cost of labor (itself a cost of production) decreased, entrepreneurs and producers could produce more efficiently, enabling them to offer products and services at lower prices as they compete for consumers ' dollars. Lower prices in turn increase the purchasing power of the American consumer, and thus enhance living standards for everyone.
This is good for both consumers and the economy at large. As immigration makes the American labor market more competitive, costs of production are reduced and prices decline. In the long run, even the domestic laborer who is forced to lower his wage demands is not any worse off, since what he loses in terms of lower nominal wages he may well regain in terms of lower prices on the goods and services he purchases as consumer. Meanwhile, everyone else benefits, and no one is privileged at the coerced expense of anyone else.
CONCLUSION Again, in the light of the recent September 11th terrorist act, immigrants have been blamed for such atrocities. However, the issue here is not about letting the wrong sort of people into this country, the real issue is that terrorist activities is a problem in its own right and should not be linked to immigrants. Just witness the fact that the chief planner and executioner of Oklahoma City bombing, Timothy McVeigh, who is literally homegrown.
It is noteworthy that it was not so many years ago that anti-immigration groups would point glowingly to Japan as an example of a nation that prospers without immigration. Japan is now entering its second decade of depression. Part of the problem in Japan has been economic policy mistakes. But some of its economic maladies are a result of low birth rates and also, the aging of the workforce in Japan is a horrendous demographic crisis in that nation. The absence of immigrants in Japan has already come to haunt this once formidable economic powerhouse. On the contrary, in both Germany and the U.S., even though freer immigration policy had created some social dilemmas, nonetheless, the benefits of creating more workers via immigration proved to be beneficial to the economy as a whole.
Lastly, as the concluding statement, I would like to quote a paragraph from a local lawyer, Jean Kim, an Associate Attorney at Hawaii Layer.com: ?As immigrants become part of our society, rather than overrunning this country, they gradually become an integral part of it, making their own contributions as do the aliens who live among humans in the film (Men in Black). Such was the original idea embodied in the concept of a ?nation of immigrants,? which still works, whether the preferred metaphor is ?melting pot? or ?tossed salad.? Also, how different are immigrants now when other nations complain about the overwhelming reach of American ?culture? throughout the world? If American influence reaches all over the world, perhaps some of the world should also come to America. Who is overrunning whom on this planet, anyway?? Bibliography Daniel T. Griswold (assistant director of trade policy studies at the Cato Institute), ?Don 't Blame Immigrants for Terrorism,? Cato Institute, 2001, http://www.cato.org/dailys/10-23-01.html Stephen Moore (Senior Fellow in Economics, Cato Institute), ?Immigrants and the U.S. Economy --- Testimony before the Senate Judiciary Committee (Subcommittee on Immigration),? April 4, 2001, http://judiciary.senate.gov/te040401sm.htm Thomas E. Lehman (At the time of the original publication, Mr. Lehman was Adjunct Professor of Economics and Western Civilization, Adult and Professional Studies Division, Indiana Wesleyan University, Marion, Indiana), ?Coming to America: The Benefits of Open Immigration.? The Freeman, a publication of the Foundation for Economic Education, Inc., December 1995, Vol. 45, No. 12., http://www.libertyhaven.com/politicsandcurrentevents/immigration/openimmigration.shtml Thomas E. Lehman (At the time of the original publication, Mr. Lehman was Adjunct Professor of Economics and Western Civilization, Adult and Professional Studies Division, Indiana Wesleyan University, Marion, Indiana), ?Coming to America: The Benefits of Open Immigration.? The Freeman, a publication of the Foundation for Economic Education, Inc., December 1995, Vol. 45, No. 12., http://www.libertyhaven.com/politicsandcurrentevents/immigration/openimmigration.shtml Doug Brugge, ?The Anti-Immigrant Backlash - Immigration and the New Economy,? http://www.publiceye.org/magazine/immigran.html (NOTE: Doug Brugge is an occupational and environmental health scientist who serves on the Board of Directors of the Massachusetts English Plus Coalition and co-chairs Unity Boston, a multiracial, grassroots political organization. Call or write PRA for footnotes to this article. This article originally appeared in The Public Eye in the Summer 1995 issue.) Thomas E. Lehman (At the time of the original publication, Mr. Lehman was Adjunct Professor of Economics and Western Civilization, Adult and Professional Studies Division, Indiana Wesleyan University, Marion, Indiana), ?Coming to America: The Benefits of Open Immigration.? The Freeman, a publication of the Foundation for Economic Education, Inc., December 1995, Vol. 45, No. 12., http://www.libertyhaven.com/politicsandcurrentevents/immigration/openimmigration.shtml Paul Harris (Augusta State University) and Gary Zuk (Auburn University), ?The Changing Face of Immigration in Germany and the United States: Rights Based Liberalism and the Making of Magnet Societies.? 1999, http://www2.smu.edu/tower/Harris-Zuk.html Jean Kim (Associate Attorney at HawaiiLawyer.com), ?Men in Black and Immigration,? 2001, http://www.hawaiilawyer.com/articles/meninblack.htm (NOTE: Jean Kim is an Associate Attorney at HawaiiLawyer.com, which is a corporate website hosted by Hawaii-based law firm Damon Key Leong Kupchak Hastert, located at 1600 Pauahi Tower, 1001 Bishop Street, Honolulu, Hawaii 96813)
REALITY CHECK Amongst the anti-immigration stalwarts, the primary argument is that continual immigration at the present pace would bring economic woes to this country, particularly in the case of labor competition and wages. However, based on the testimony before the Senate …show more content…
Judiciary Committee (Subcommittee on Immigration) on April 4th, 2001, Stephen Moore, Senior Fellow in Economics of Cato Institute, these claims are unjust if not unfounded. Based on the anti-immigration advocates claims, the current level of immigration would lead to such economic problems as: 1) increased unemployment for native born workers; 2) higher poverty rates of native born Americans; 3) lower incomes for American workers; 4) increased economic problems for minority workers; 5) a huge surge in welfare dependency; and 6) lower overall rates of economic growth. Nonetheless, the evidence thus far cannot substantiate such assertions.
Unemployment - In the period 1978-82 the U.S. unemployment rate was between 6 and 8%. Today, the U.S. unemployment rate is between 4 and 5%. The U.S. economy has shown a remarkable ability to absorb new workers into the economy?both natives and immigrants?without causing job losses. Between 1980 and 2000 the U.S. became a job creation machine, with some 35 million more Americans employed today than 20 years ago. The U.S. has created more new jobs in the past 20 years than all of Japan and Europe combined since 1980. In fact, despite the fact that the U.S. takes in nearly as many immigrants in a year as does all of Japan and Europe combined, it is the U.S.?the nation of immigrants?that now has the lowest unemployment rate in the industrialized world.
Poverty - The poverty rate for Americans has fallen over the past 20 years for all races. The latest poverty rate statistics indicate that poverty is lower than at anytime since the mid 1970s. See Figure 4. A recent study by the Center of Immigration Studies reports that since 1980 the rate of poverty among immigrants has risen. Of course, if the overall level of poverty has fallen during this period, it means that the reduction in poverty for native-born Americans has been all the more impressive. In sum, there is no evidence that immigrants increase poverty among natives, in fact the evidence suggests the opposite effect.
Incomes - Median family income in the U.S. has risen over the period 1981-1998 from $39,000 to $45,800 or by roughly 16 percent, according to recent Census Bureau data. With inflation properly measured, median family income has risen since 1981 by closer to 25 percent. Again, wage suppression does not appear to have occurred in this period of high immigration.
Economic Advancement of Minorities - There is still in America far too wide an income gap between the races. But over the past 20 years of high levels of immigration, the income gap has actually shrunk, not widened. For example, since the early 1980s, the growth of incomes for black families has exceeded the growth for white families. The black unemployment rate has much fallen faster than the white unemployment rate, as has the black poverty rate. The income gap between blacks and whites and between men and women has narrowed to its lowest level in recorded history. From 1981 to 1998, the black incomes relative to whites shrunk from 60 percent to 69 percent--the highest ever recorded. For women, the gap narrowed from 89 percent to 94 percent. In sum, we have had record immigration and we have had record economic improvements for blacks.
IMMIGRATION AND WELFARE Another argument used in favor of immigration controls concerns the American welfare system and its potential abuse by immigrants who migrate into America merely to feed at the public trough of social services. The claim is made that the welfare system, not potential economic freedom, is the lure which draws immigrants into the American economy. Immigrants -unproductive, slothful, and indigent - constitute a dead-weight loss on the American economy, and further increase the tax burden on productive Americans. Therefore, we must police our borders and keep out the undesirables.
This argument is statistically and theoretically flawed. Contrary to prevailing public opinion, current immigrants do not "abuse" the public welfare system, even in the areas where immigration (legal or illegal) is most concentrated. In fact, immigrants have little effect on the current system of taxation and wealth redistribution. As Julian Simon relates: Study after study shows that small proportions of illegals use government services: free medical, 5 percent; unemployment insurance 4; food stamps, 1; welfare payments, 1; child schooling, 4. Illegals are afraid of being caught if they apply for welfare. Practically none receive social security, the costliest service of all, but 77 percent pay social security taxes, and 73 percent have federal taxes withheld. ... During the first five years in the United States, the average immigrant family receives $1404 (in 1975 dollars) in welfare compared to $2279 received by a native family.
IMMIGRATION AND CULTURE A final argument against immigration comes surprisingly from those generally supportive of liberty and the philosophy of the limited state. These critics are concerned for the preservation of what they see as a distinct American culture and its traditional heritage of European-style limited government and market economies. Their fear is that this traditional culture is being sabotaged by an influx of immigrants who are unfamiliar with and perhaps even hostile toward its institutional framework.
There is another flaw lurking in the argument that open immigration leads to the decline of a nation 's cultural and institutional framework. Contrary to the anti-immigration position, the American traditions of limited government and free market economies are not based upon ethnic or racial origins. They are based upon ideas. Western cultures cannot suppose themselves to have a monopoly on the philosophy of liberty, nor can Americans argue that the political values of the limited state cannot be inculcated in non-American immigrants. The ideas of freedom that have created the American tradition can apply to any ethnic or racial make-up.
The answer is to return once again to a government "of laws and not of men." In other words, the state must be radically limited in power and scope, with only minimal duties which are explicitly defined. This will put state power beyond the reach of those individuals or voting blocs that would seek to exploit it for personal gain. We then would have no reason to fear immigrants, regardless of their ideological or political persuasion. Their ability to " sabotage" our freedoms would be removed not because we expand state power to keep them out, but because we diminish state power in all areas and allow them in.
ECONOMIC BENEFITS BROUGHT BY IMMIGRANTS What can we conclude about the impact of immigration on the U.S. economy since 1980? Over the past 20 years the U.S. economy has experienced a $10 to $15 trillion increase in net wealth, according the Federal Reserve Board data, the GDP has grown by nearly 80 percent (after inflation), and the inflation rate has fallen to nearly zero. The National Bureau of Economic Research recently described the past 18 years as the longest and strongest period of sustained prosperity in the U.S. in this century. If immigrants are somehow a "cost" to the U.S. economy, that cost has been virtually invisible. The experience of the past two decades puts a huge burden on the shoulders of those who contend that immigrants are economically burdensome. Again, based on the testimony of Stephen Moore, these are his findings: 1. Immigrants and their children increase economic growth. In the most comprehensive study ever conducted on immigration, the National Research Council of the National Academy of Sciences found that immigrants inflate the incomes of U.S.-born workers by at least $10 billion each year. This estimate is highly conservative because it does not include the impact of immigrant-owned businesses or the impact of high-skilled immigrants on overall productivity. Still, the NRC estimates that the typical immigrant and his or her children pay an estimated $80,000 more in taxes that they will receive in local, state and federal benefits over their lifetimes.
2.
Immigrants pay their own way when it comes to services used and taxes paid. Immigrants use many government services?particularly at the state and local levels--but they are also pay a lot in taxes. Conservatively estimated, in 1998 immigrant households paid an estimated $133 billion in direct taxes to federal, state and local governments. Adding the tax receipts paid by immigrant businesses brings the total annual tax contributions of immigrants to about $162 billion for 1998. In any given year, immigrants may use more in services than they pay in taxes, but over their lifetimes, immigrants are a fiscal bargain to native taxpayers. As their earnings rise over time, immigrant taxes exceed the benefits
received.
3. Immigrants have a rapid rate of economic assimilation after they arrive in the U.S. As noted above, one of the most important economic characteristics of immigrants is that their earnings rise over time in the U.S. Hence, during their first years after arrival in the U.S. earnings are low and immigrants typically are net drains on the public coffers. But over time--usually after 10-15 years in the U.S--they turn into net contributors. This economic assimilation pattern varies by ethnicity and country of origin, but is still evident today as it was 30 years ago when researchers first began to study the rate of economic success by immigrants over time. We also this economic assimilation when it comes to poverty rates, unemployment, and home ownership.
4. The age profile of immigrants is a huge demographic bonus to native-born Americans. Most immigrants arrive in the United States in the prime of their working years. For example, more than 70 percent of immigrants who come to the U.S. are above the age of 18 upon arrival. This means that there are roughly 17.5 million immigrants in the U.S. today whose educational and rearing costs were borne by the citizens of the sending country, not American taxpayers. They were educated elsewhere. The total discounted present value windfall to the United States of obtaining this human capital at no expense to American taxpayers is roughly $1.43 trillion. Immigration can be thought of as an enormous $1.4 trillion transfer of wealth from the rest of the world to the United States.
5. Immigrants are huge net contributors to the Social Security and Medicare programs. Only 3 percent of immigrants enter the U.S. over the age of 65, whereas 12 percent of Americans are over 65--and that percentage will grow to 15% within 20 years. Based on the calculations of the actuaries at the Social Security Administration, this study estimates the total value to the Social Security system from current levels of immigration. The total net benefit (taxes paid over benefits received) to the Social Security system in 1998 dollars from continuing current levels of immigration is nearly $500 billion from 1998-2022 and nearly $2.0 trillion through 2072. Continuing immigration is an essential component to solving the long term financing problem of the Social Security system.
6. Immigrant entrepreneurs are a major source of new jobs and vitality in the American economy. Most immigrant businesses--like most businesses started by American-born entrepreneurs--are not highly successful or large employers. But many of America 's largest and most profitable businesses in today were started by immigrants. Immigrants who entered the U.S. as refugees, economic immigrants, or family-sponsored immigrants are now at the helm of some of the nation 's leading and rapidly growing technology businesses: Hungarian-born Andrew S. Grove, recently retired as Chairman and CEO of Intel. Taiwanese immigrant John Tu co-founded Kingston Technology, a computer-memory-module maker in 1987. When he sold an 80 percent interest in the company in August 1996, it had annual sales of $1 billion. Algerian-born Eric Benhamou, heads 3Com Corp. Iranian-born brothers Farzad and Farid Dibachi founded and heads Diba, Inc. The income and employment generated by 10 highly successful immigrant firms. These 10 firms alone generated $28 billion in revenues and employed 75,000 American workers in 1997. The tax revenues paid in 1997 by the companies directly and their employees was at least $3 billion.
IMMIGRATION AND LABOR ISSUES Immigration?s impact on the American labor?s competitiveness and wages is perhaps the most contentious issue in the whole immigration debate. Many Americans argue that free immigration would destroy "working class" Americans ' ability to earn a living. They claim that allowing free and open borders to any and all immigrants would put decent, hardworking Americans out of work. Perhaps what these Americans really fear, however, is that someone will emerge from the "immigrant class" who would be willing to work for less than they while producing equal or greater output.
Displaced workers, along with others who fear for their livelihood, are fertile ground in which to sow anti-immigrant sentiment, since angry and frustrated people often seek some target on which to blame their problems. The right wing has organized and manipulated such anger and resentment, turned it away from corporations, and directed it against the government, decrying high taxes and the inability of the state to solve problems such as social deterioration, homelessness, crime, and violence. In addition to the target of "failed liberal policies," immigrants make a convenient scapegoat and a very tangible target for people 's anger. Racial prejudice is often an encoded part of the message.
However, a policy of open immigration would indeed force unskilled American laborers to compete for their jobs at lower wages. However, far from being an evil, this is a desirable outcome, one that should form the basis for a new immigration policy. By inviting competition into the American labor markets, artificially inflated labor costs could be eliminated and a greater level of labor efficiency could be achieved.
As the cost of labor (itself a cost of production) decreased, entrepreneurs and producers could produce more efficiently, enabling them to offer products and services at lower prices as they compete for consumers ' dollars. Lower prices in turn increase the purchasing power of the American consumer, and thus enhance living standards for everyone.
This is good for both consumers and the economy at large. As immigration makes the American labor market more competitive, costs of production are reduced and prices decline. In the long run, even the domestic laborer who is forced to lower his wage demands is not any worse off, since what he loses in terms of lower nominal wages he may well regain in terms of lower prices on the goods and services he purchases as consumer. Meanwhile, everyone else benefits, and no one is privileged at the coerced expense of anyone else.
CONCLUSION Again, in the light of the recent September 11th terrorist act, immigrants have been blamed for such atrocities. However, the issue here is not about letting the wrong sort of people into this country, the real issue is that terrorist activities is a problem in its own right and should not be linked to immigrants. Just witness the fact that the chief planner and executioner of Oklahoma City bombing, Timothy McVeigh, who is literally homegrown.
It is noteworthy that it was not so many years ago that anti-immigration groups would point glowingly to Japan as an example of a nation that prospers without immigration. Japan is now entering its second decade of depression. Part of the problem in Japan has been economic policy mistakes. But some of its economic maladies are a result of low birth rates and also, the aging of the workforce in Japan is a horrendous demographic crisis in that nation. The absence of immigrants in Japan has already come to haunt this once formidable economic powerhouse. On the contrary, in both Germany and the U.S., even though freer immigration policy had created some social dilemmas, nonetheless, the benefits of creating more workers via immigration proved to be beneficial to the economy as a whole.
Lastly, as the concluding statement, I would like to quote a paragraph from a local lawyer, Jean Kim, an Associate Attorney at Hawaii Layer.com: ?As immigrants become part of our society, rather than overrunning this country, they gradually become an integral part of it, making their own contributions as do the aliens who live among humans in the film (Men in Black). Such was the original idea embodied in the concept of a ?nation of immigrants,? which still works, whether the preferred metaphor is ?melting pot? or ?tossed salad.? Also, how different are immigrants now when other nations complain about the overwhelming reach of American ?culture? throughout the world? If American influence reaches all over the world, perhaps some of the world should also come to America. Who is overrunning whom on this planet, anyway?? Bibliography Daniel T. Griswold (assistant director of trade policy studies at the Cato Institute), ?Don 't Blame Immigrants for Terrorism,? Cato Institute, 2001, http://www.cato.org/dailys/10-23-01.html Stephen Moore (Senior Fellow in Economics, Cato Institute), ?Immigrants and the U.S. Economy --- Testimony before the Senate Judiciary Committee (Subcommittee on Immigration),? April 4, 2001, http://judiciary.senate.gov/te040401sm.htm Thomas E. Lehman (At the time of the original publication, Mr. Lehman was Adjunct Professor of Economics and Western Civilization, Adult and Professional Studies Division, Indiana Wesleyan University, Marion, Indiana), ?Coming to America: The Benefits of Open Immigration.? The Freeman, a publication of the Foundation for Economic Education, Inc., December 1995, Vol. 45, No. 12., http://www.libertyhaven.com/politicsandcurrentevents/immigration/openimmigration.shtml Thomas E. Lehman (At the time of the original publication, Mr. Lehman was Adjunct Professor of Economics and Western Civilization, Adult and Professional Studies Division, Indiana Wesleyan University, Marion, Indiana), ?Coming to America: The Benefits of Open Immigration.? The Freeman, a publication of the Foundation for Economic Education, Inc., December 1995, Vol. 45, No. 12., http://www.libertyhaven.com/politicsandcurrentevents/immigration/openimmigration.shtml Doug Brugge, ?The Anti-Immigrant Backlash - Immigration and the New Economy,? http://www.publiceye.org/magazine/immigran.html (NOTE: Doug Brugge is an occupational and environmental health scientist who serves on the Board of Directors of the Massachusetts English Plus Coalition and co-chairs Unity Boston, a multiracial, grassroots political organization. Call or write PRA for footnotes to this article. This article originally appeared in The Public Eye in the Summer 1995 issue.) Thomas E. Lehman (At the time of the original publication, Mr. Lehman was Adjunct Professor of Economics and Western Civilization, Adult and Professional Studies Division, Indiana Wesleyan University, Marion, Indiana), ?Coming to America: The Benefits of Open Immigration.? The Freeman, a publication of the Foundation for Economic Education, Inc., December 1995, Vol. 45, No. 12., http://www.libertyhaven.com/politicsandcurrentevents/immigration/openimmigration.shtml Paul Harris (Augusta State University) and Gary Zuk (Auburn University), ?The Changing Face of Immigration in Germany and the United States: Rights Based Liberalism and the Making of Magnet Societies.? 1999, http://www2.smu.edu/tower/Harris-Zuk.html Jean Kim (Associate Attorney at HawaiiLawyer.com), ?Men in Black and Immigration,? 2001, http://www.hawaiilawyer.com/articles/meninblack.htm (NOTE: Jean Kim is an Associate Attorney at HawaiiLawyer.com, which is a corporate website hosted by Hawaii-based law firm Damon Key Leong Kupchak Hastert, located at 1600 Pauahi Tower, 1001 Bishop Street, Honolulu, Hawaii 96813)