Memo To: Website browsers, supply-side students, fans and clients
From: Jude Wanniski
Re: Immigration and Growth
[Yesterday’s memo consisted of an exchange of letters prompted by the June 27 guest lecture by Reuven Brenner of McGill University at our Supply-side University, on the subject of economic growth. A website browser, R. K., whose family migrated to the U.S. in 1968, argued against the Brenner proposition that immigration to the U.S. is and remains a source of economic growth and renewal.]
It is an indisputable fact that the United States is now the only superpower on the planet. As Brenner argues, the United States is unique, in the sense that it is the only nation that was created from scratch, by a state (which “brought forth a new nation, conceived in liberty,...” etc.). Mr. K. can quibble that for brief periods of high immigration, there has been a correlation with low growth here. Over the sweep of centuries, though, he would surely acknowledge it would be absurd to argue that net immigration has been bad for America.
On the other hand, there is an argument, which I have been making for some years, that the United States should no longer be promoting immigration. That is, I believe Brenner is right when he says net immigration is good for the United States, but that he might agree it may no longer be in the world’s best interest that it send the best of its artistic and entrepreneurial talent to the U.S. I certainly do not agree with The Wall Street Journal’s open immigration policy, which would essentially permit the rest of the world to move to the United States, leaving the rest of the planet vacant. The WSJournal makes its argument, as does Brenner, on a safe assumption that the rest of the world would only send us its best people -- those with the gumption to get up and go from where they are to this land of liberty. In a zero-sum reckoning, what is good for us is bad for our competitors. That kind of argument is perfectly reasonable in a zero-sum commercial -- or even geopolitical -- world. It strikes me as a weak one to lean upon in a world in which the United States is at the pinnacle of global commerce and politics. Our responsibilities are quite different now than when we were the last refuge for a sick and warring world.
When we think of human capital as compared to financial capital, it makes perfect sense that the New World has always benefitted from immigration, which is a self-selection process. Men who have been sufficiently dissatisfied with the opportunities in their homeland and brave enough to pull up stakes and migrate here have always been a source of economic strength and spiritual renewal. Most slaves brought here in the 17th and 18th century came not through a self-selection process, but were sold by their tribal chiefs as cheap labor, in exchange for financial capital. For centuries, they were forcibly prevented from adding to their human capital through education and work experience. I would disagree with Brenner, but not much, about the weight given to immigration relative to financial capital created out of domestic raw material. That is, I believe most countries of the world could enjoy much greater economic well-being with better policies , whether or not they are warm or cold to immigration.
I’m not very sympathetic to Mr. K.’s argument -- or Peter Brimelow’s -- that immigration is a serious threat to our national culture. I am a bit sympathetic, as I was last year to Pat Buchanan’s argument that the United States should pause in its relatively open immigration policy. Yet I believe the purpose of such a pause should be to discuss the fluid movement of human capital to and from the United States. Mr. K. is correct in his observation that for a long period of U.S. history, there were great numbers of immigrants who returned to their homelands. This occurred for a variety of reasons, though, not simply because there was no social safety net here. Immigrants would be able to quickly accumulate financial capital, compared to the opportunities at home, and return home with a cash foundation for new enterprise.
In the current political environment, the best efforts and energies of people like Pat Buchanan, Peter Brimelow and Mr. K. should be devoted to fundamental reform of the International Monetary Fund and World Bank, not U.S. immigration law. The IMF is far and away the greatest source of economic and political distress in the developing world -- and thus the greatest source of emigration. Yes, the United States will benefit enormously if the best leaders in Africa, Asia and Latin America become so disgusted at home that they move here to make a life. Wouldn’t it be far better for the world if we showed the kind of leadership that would not only cause great opportunities to open in the developing world for the people who have remained, but also pull back a great many men and women who have left? Yes, that would be our loss, in the short run. But in the long run, it would be a net benefit to the family of man.