Half a million people demonstrating on the streets of Los Angeles caught How the World Works a bit unprepared, but we're sure paying attention now. The mass protest against the House of Representatives' draconian proposed anti-illegal immigration bill is a landmark political event. In California, as the L.A. Times noted in its coverage, the attempt in 1994 to deny social services to illegal immigrants with Proposition 187 is now regarded as having pushed hundreds of thousands of Latinos into the Democratic Party. Republicans all over the Southwest have to be freaking out at the television coverage of the Los Angeles masses.
Which is not to suggest that the left is by any means united on how to confront the issue. Illegal immigration is seen by many as the flip side of offshoring, another baleful side effect of globalization that puts pressure on the living standards of Americans. There's a huge clue here that something is not right in the bowels of the American economy: When times start to get hard for working-class Americans, anti-illegal immigration fervor always boils over. There was plenty of it in California in the recession of the late 1980s, but you didn't hear much about it during the go-go '90s. As a thermometer warning politicians that trouble is brewing, headlines about illegal immigration are well-nigh infallible.
The freshest example of how complicated it is to find one's way through these shoals came today, when I learned that two of the economists that I look to most often for guidance, Paul Krugman and J. Bradford DeLong, were disagreeing. Krugman, even while professing himself "instinctively, emotionally pro-immigration," says a "review of serious, nonpartisan research reveals some uncomfortable facts about the economics of modern immigration, and immigration from Mexico in particular." (And get this, he even references a study co-authored by Harvard economist Lawrence Katz, who has now achieved the unlikely trifecta of getting mentioned in three straight How the World Works posts.) According to Krugman's survey, the net benefits of immigration to the American economy appear small, and the poorest Americans are the hardest hit by competition. Krugman doesn't have much good to say about any of the bills the Senate is currently considering.
Meanwhile, DeLong characterizes Krugman as "confused" and "probably wrong." The thrust of his argument is that spending billions on building border walls and rounding up illegal immigrants is an incredibly stupid way to fight poverty in the United States.
"We should be taking steps to equalize America's income distribution: more progressive tax brackets, more public provision of services, a more generous Earned Income Tax Credit, a higher minimum wage, a greater focus on education," writes DeLong. "But tight restrictions on immigration are a really lousy anti-poverty policy."
How the World Works is only just beginning to dip its toes into the question of illegal immigration with this post. But it's high time to grapple. Googling around to see if any of my other trusted economists had spoken out on the issue, I found an illuminating back-and-forth between Joseph Stiglitz and CNN's Lou Dobbs that places the current drama directly in the context of some of the larger issues we've been discussing here.
Stiglitz notes that imports of American corn into Mexico have depressed the standard of living for Mexican farmers -- one factor fueling illegal immigration. Corn farmers in the United States are massively subsidized, and Mexican farmers can't compete. In Stiglitz's conceptualization of "fair trade" the U.S. would not be allowed to subsidize agriculture. Quite the opposite: Mexico, as the poorer country, would be allowed to block American exports.
It is clearly in the interest of the United States to support the rapid development of poorer countries. Not only would this reduce the pressure of illegal immigration, but it would also diminish the cheap-labor comparative advantage that is hammering American workers via offshoring. It seems to me largely inconceivable that building walls, no matter how well fortified, will insulate the United States from the pressure of a world where so many enjoy standards of living worse than the vast majority of Americans. The only long-term way out of the current, intensifying jam is to figure out ways for the rest of the world to become more prosperous.
In the meantime, Democrats ought to be looking at recent Californian history for a clue as to which way to break on the issue. Bush's guest worker proposal, in which illegal immigrants get temporary visas but aren't allowed to vote and must eventually return to their home country, is crafted both to please businesses that want cheap labor and to avoid further weakening the Republican hold on vast swaths of the Southwest. There's a sector of the right wing that wants to stop illegal immigration because it fears the "reconquista" of territory the U.S. took by force. But the left should be thinking about a little reconquista of its own. Find the right stance on immigration, and political power in some long-held Republican strongholds could follow.