Immigration as Economic Policy

It is time for us to face the facts: Immigrants are economic commodities. The United States, as a capitalist nation (arguably the capitalist nation), needs immigrant labor to keep the costs of production—and consequently, final goods and services produced and sold in this country—low. In order to streamline its system of labor importation—also known as immigration policy—the U.S. must return its focus solely to economic concerns and matters of domestic social utility. But what can and should the U.S. do to make sure every immigrant who crosses its borders is a valuable addition to the domestic labor market? How can the U.S. get the most out of its investments in immigrant labor? Undoubtedly, the moment for reform has arrived, and the focus needs to be on identifying labor market deficiencies; attracting the workers best suited to fill in these gaps, regardless of nationality; and making sure they live and work in environments that foster greater productivity and greater potential for growth in human capital.

Comprehensive Immigration Reform, a policy characterized by a desire to improve the current immigration system through a proposed combination of border enforcement and visa reform, offers some ideas as to how the United States can achieve these economic goals (Rosenblum 10). However, CIR reflects the prevailing public and political tendency to devote all attention to ideas about “legality.” It is a mistake to focus solely on the so-called “status” of individual immigrants. Documented or undocumented, legal or illegal, in terms of economics, all immigrants are labor, albeit with varying degrees of education and differing skill sets. The United States needs to develop a new dichotomy of classifying immigrants, one that draws the debate away from theoretical and abstract notions of legality and persuades the public to look at immigration in more realistic, concrete terms. After all, more than two-thirds of the current immigrant population has entered through legal means, so it is a mistake to believe the greatest problem with immigration today is documentation or lack thereof (Jones-Correa 13). To do so distracts the United States from the real issues at stake and therefore inhibits policymakers from finding solutions that will provide greater economic efficiency for the country.

Likewise, by focusing on legality, the U.S. is in danger of ignoring the obvious conclusion that its laissez-faire practices have already revealed. Migration is a part of capitalism. It is a phenomenon driven primarily by globalization, the opening up of nations to the economic possibilities of an increasingly interconnected—and efficient—world. International tourism and business, as well as education abroad, all have the potential to bolster national economies, and like immigration, they involve the movement of peoples across national borders (Doty 171). All of these phenomena occur because of the needs of the global market. In the case of immigration, the market creates “push” and “pull” factors that guide people’s movements (Doty 171). Individuals are pushed out of labor-intensive nations, where the labor markets are flooded with too many workers, wages are low, and unemployment is high, and pulled towards markets abroad, where wages are higher. According to the neoclassical economic approach to understanding why international migration occurs, these push and pull factors reflect the market’s tendency to bring itself back into an equilibrium in which wages even out across both labor-intensive and capital-rich nations (Massey 35).

Evidence of a change in immigrant flows from Mexico to the U.S., for instance, is already apparent, but experts argue that these changes are not necessarily due to greater border enforcement measures on the part of the U.S. government. The enforcement budget of the Immigration and Naturalization Service has increased exponentially since 1995 (see Figure 1, Cornelius 662), and the number of apprehensions of migrants attempting to enter illegally between 1994 and 2000 reached record highs (Cornelius 665). However, despite the so-called success of these “concentrated border enforcement” measures, such as the construction of fencing, lighting, and high-tech imaging devices along the southern border, it is impossible to determine a causal relationship between greater enforcement, increased apprehensions, and, ultimately, successful deterrence of undocumented migration (663-6). On the other hand, evidence from the Pew Hispanic Center and other sources suggests that in 2010, the number of undocumented migrants from Mexico, at least, was at a record low for recent years, and experts attribute the decline to less attractive economic conditions in the U.S. due to the recession and better economic opportunities in Mexico (Cave). This suggests that, on par with neoclassical economic theory, potential migrants make their decisions on whether or not to emigrate based on cost-benefit analyses of economic conditions at home and abroad (Massey 35). Therefore, the migration of peoples will always occur in an international market based on capitalist principles, due to domestic and international economic conditions, and will fluctuate over time based on the dynamic nature of these conditions. Unless the U.S. wants to get rid of capitalism, it cannot get rid of immigration. Thus, promoting border enforcement policies without also providing sufficient, alternative, legal means of entry for workers, who have proven to be economic contributors to this country both historically and currently, has been rendered utterly useless.

Similarly, economic migration occurs across all socioeconomic backgrounds and nationalities. Both low-skilled and high-skilled immigration occurs consistently based on economic factors, and both can benefit the U.S. economy. For low-skilled immigrants, immigration occurs because of a need to escape poverty and unemployment and to find work at higher wages (Massey 35). For high-skilled immigrants, immigration occurs because of a desire to locate markets with the highest demand for their skills, since these employers will pay the highest wages (35). The U.S. economy is incredibly diverse and could benefit from both types of employment-based immigration. While illegality should not be the focal point of the debate, it still plays a role based on the fact that undocumented workers are a liability for firms and could potentially threaten economic efficiency in the short run if they live in fear of deportation and cannot gain access to social services. Therefore, it is the responsibility of the U.S. government to ensure adequate legal channels of entry for potential immigrant workers in order to avoid deportation interrupting the production process. Consider the small family-owned apple orchard and candy apple production plant depicted in PBS’s Homeland documentary: every time they lose a worker, they lose productivity because they have to recruit and train a replacement, a process that negatively impacts efficiency.

Thus, it is to the United States’ advantage, as a nation that promotes capitalist enterprise, to conduct studies to help determine the correct number of H-2 visas available to meet seasonal employment needs. Similarly, there is a definitive need for reforming the visa system for international students educated in the U.S. and for high-skilled foreign workers, especially entrepreneurs in the tech sector, who are seeking employment in the U.S. The lack of availability for long-term visas or a route to legal permanent residency for foreign students post-graduation has caused the number of foreign students coming to the U.S. to fall, as they have found more favorable immigration policies in countries such as Australia (Batalova). Deferred Action for Childhood Arrivals (DACA), which was passed in 2012 by the Obama Administration and provides “a two-year reprieve from possible deportation” for qualified young immigrants to enable them to continue their education or to work legally, is a helpful tool for ensuring that the U.S. does not lose the talented, high-achieving teenagers and young adults already living in the country (Batalova and Mittelstadt 2). However, the DACA marks a political compromise rather than an example of true reform, and it is therefore insufficient because it does not provide a long-term option for young immigrants to earn permanent legal residency and gain citizenship. Data suggest that there are approximately 1.76 million young people who would benefit from the DACA residing in the U.S. today (Batalova and Mittelstadt 2). If they have been educated in the U.S. system for the majority of their lives, have benefitted from public education, have utilized domestic resources, and if they identify more closely with the United States than with their countries of origin, then it would be a huge waste of human capital to allow these individuals merely a brief reprieve from deportation rather than a clear path to citizenship. Likewise, according to a Migration Policy Institute study, “More than 1.3 million college-educated immigrants were underutilized in the US labor market in 2005-2006…[which] represents a waste of human capital of 1.3 million skilled immigrants” (Batalova and Fix). Congress’s inability to pass reform measures in the past decade to address the need for an updated visa system, due largely to its “asymmetrical” focus on combating “illegality” through enforcement-only policies, has done nothing to promote the United States’ economic agenda and has, in fact, succeeded only in making it more difficult to satisfy the nation’s economic needs (Rosenblum 10).

In terms of economic efficiency, although it would be highly convenient to do so, it is impossible to ignore the reality of the human condition. Thus, issues that could potentially impede social inclusion, and therefore threaten productivity, must be discussed. Historically, the U.S. has given preference to family reunification visas, while simultaneously failing to provide an employment-based visa system capable of meeting national economic demands. As a result, family reunification has been historically uneven and discriminatory in that it favors families with a higher socioeconomic status and a certain ethnic background (Hwang and Salazar Parreñas 104). This is dangerous because it devalues low-skilled immigrant labor, which is incredibly important for the U.S. economy. If the idea is that workers are more stable contributors to society when they are secure in their domestic, family environments, then it is within the United States’ best interest to ensure that family reunification continues to occur through legal channels and for all immigrants (Messina 38-39). The system should therefore be reformed to cut wait times for legal permanent residents to be reunited with family members and to include a system of payment that is either graded based on income or broken down into a series of smaller, more manageable payments.

Overall, immigration is a permanent feature of capitalist societies, and the United States stands to benefit. If it decides to adopt CIR, it should be with the goal of increasing economic efficiency by liberalizing immigration policies in mind. A preoccupation with labels that classify immigrants based on legal status, as well as a desire to cut the U.S. off from certain inflows of migration through increased border enforcement, reveals a xenophobic tendency that impairs market efficiency and inevitably hinders economic productivity and growth. The United States should only be concerned with immigrants’ statuses insofar as they are in danger of being cut off from social services, like welfare and public education, because of their lack of documentation. That is the real threat: that workers are discriminated against in society and potentially prevented from receiving the tools that can make them—and their children—more productive members of society. Another mass amnesty like the one enacted in 1986 will do nothing to fix this problem in the long term if necessary visa reforms and increased channels for legal migration are not put in place. However, combined with liberal reforms, amnesty for the nearly 12 million undocumented migrants already present in the U.S. would be beneficial for society and for the economy because these people are here to stay, and it therefore makes no sense to limit their potential. Ultimately, in the long run, economic factors determine people’s decisions to migrate, and those factors are stronger than the law.

Allison Russell is a FCRH 2013 Latin American Studies major and she may be contacted at arussell1@fordham.edu.

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  1. […] This study is not the only one that positively supports immigration. Do your own Google search and you’ll find the pros and cons of immigration — with pros far in the lead, particularly economically. (Just read the Fordham Political Review) […]

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