I’m in midtown Manhattan right now for work. Lines form outside theater box offices starting at 0800 every morning. The line at the Shake Shack is at least an hour long at all times. The sidewalks are so crowded that pedestrian collisions are common. A cozy one-bedroom apartment rents for $4300 per month, affordable for sharing by three entry-level workers.
Now the Congressional Budget Office issues a report saying that if we just increase the population by 10.4 million via immigration we can cut our budget deficit (due to more people from whom the government will be collecting taxes). The U.S. has plenty of empty space, e.g., in western Kansas and central Detroit, but immigrants tend to settle where the jobs are, e.g., already-crowded places such as New York City and Los Angeles.
Is this plan therefore analogous to the following situation:
- three young people are sharing a one-bedroom apartment in midtown
- they find that they are having trouble meeting expenses (a budget deficit)
- they invite a fourth friend from college to join them, contributing to the rent and co-sleeping on the sofabed in the living room
?
Another analogy: the Philippines. They have tons of working-age people, because the population has tripled since 1960. There are now more Filipinos than Thais, Koreans, Taiwanese, Germans, English, French or Italians. They will outnumber Japanese by 2030.
And which east Asian country has the lowest GDP per capita growth since 1960? What a coincidence: the Philippines.
Politically easier to raise immigration/birthrate than to have actual policies, e.g. raise retirement age, cut spending, raise taxes, etc.
We’re not alone in bad governance. Japan’s earner/retiree ratio is only like 3 to 1. The logical solutions (work more years, go live with your children, etc.) are less palatable than what Japan is actually doing, which is paying women huge sums to have babies.
It’s only analogous if the three friends don’t bother making sure their 4th friend has a job and the ability to meaningfully contribute to rent!
10 million more democrat votes & nothing more. This happens in every democrat term. Then we have same cries of labor shortages from hiring managers who want to reduce costs, the same hiring freezes as they wait for more certainty on the bill’s passage. The H1B quota goes up again & mass layoffs ensue.
More accurate if one of the existing roommates is unemployed and the new 4th friend is willing to work for lower wages than the others.
Other facts to consider, unique only to Mexican immigrants:
– 20 years after immigrating, 43% of Mexican immigrants receive welfare
– going back 4 generations, on average each generation of Mexican immigrants earns less than the previous generation
Let’s take as a given that if America can’t find space / add new jobs for 10 million new people (presumably already educated, adult, ready to work, capital in hand) from overseas… it follows that it is still less able to add new jobs for 10 million illiterates who can’t even feed themselves (new-borns). Logically, the government should immediately enact laws restricting the level of new births to an economically viable level.
Milton: I tried to check your stats regarding welfare usage for immigrants. I found http://cis.org/2012-profile-of-americas-foreign-born-population and the numbers were kind of shocking (on average, 40% of immigrants are receiving welfare 20 years after arriving here; 57% of households headed by a person born in Mexico are receiving welfare). On the other hand, the largest number are getting food stamps, which I don’t think can properly be considered welfare (since the USDA spends half of its energies driving up food prices in the U.S. to higher-than-market levels, so the only way to pay close to a market price for food is to use food stamps (coincidentally provided by the other half of the USDA)).
Ed: That’s a clever point, but I think it is falsified to some extent by the cis.org study cited above. It seems that the children of immigrants, on average, are not economically prosperous.
My point with the original posting was not to criticize immigrants, but to point out that a healthy economy is one where the current participants can pay the bills. It is a sign of poor economic health (and/or simple greed and refusal to live within one’s means) when one is forced to rely on one’s children, friends, or immigrants.
“It is a sign of poor economic health (and/or simple greed and refusal to live within one’s means) when one is forced to rely on one’s children, friends, or immigrants.”
Absolutely – although sheer demographics mean that some developed countries with very low birth rates placing them on a trend-line to extinction (e.g. Italy, Japan) are finding themselves in just such a position, and most other developed nations are simply a little further behind on the same trend.
“It seems that the children of immigrants, on average, are not economically prosperous.”
Sure, but that seems easily explained by educational attainment (if we take country of origin as a crude proxy for education): the CIS figures show high home ownership rates for English and German immigrants, and much lower rates for Mexican immigrants.
Could it bed that the very many immigrants with minimal education become low-earning Americans, and the smaller number with good educations become high-earning Americans? The prosperity of immigrants seems to say more about the immigrants America selects than it does about the immigrants themselves.
Ed: It is undisputed that some other developed countries have gotten into the same situation in which they have spent everything that wasn’t nailed down and therefore must rely on tomorrow’s immigrants or today’s children to pay the bills of current adult citizens. But such a situation was not inevitable. The Netherlands, for example, has a fully funded (with paid-for-in-todays-cash investments) government-run pension system. Ditto for Singapore, I believe. This kind of system is never going to help a politician get elected, of course, since it entails reduced present consumption for voters and an unpleasant conversation that starts with “You know, the future may not be infinitely brighter than the present.”
The post misunderstands the reason for the housing shortage in Manhattan. The so called crowding is in large part due to zoning and rent control.
A little research would have save you the trouble of constructing this elaborate theory.
rss: You are saying that if there were a free market in real estate, unencumbered by regulation, an apartment in Manhattan would cost no more than one in a small midwestern city (e.g., Peoria, where a median rental is about $700/month)? And that the island of Manhattan would not be any more crowded than Peoria, Illinois? (currently Manhattan has approximately 30 times the population density of Peoria)
Completely agree – not fully-funding pensions is a nonsense for private firms, and the same logic applies to states. As you say, the trick is in getting an electorate to see the value in the Dutch / Singalese system.