Friday , August 17 2018
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Lost in migration

Summary:
Last week, Trump allegedly questioned why US should accept more immigrants from Haiti, El Salvador and other ‘shithole countries’ in Africa, which honestly is a reasonable question. In all fairness, these countries are in one way or another not that desirable to live in. This, however, doesn’t mean the US or any other country shouldn’t accept immigrants coming from these countries just because they drew the shortest straw in the lottery of life. Most people in a similar position would try to amend their situation - and should be able to, especially considering the fact that half of the people in Haiti and El Salvador would, if possible, migrate to a different country and nearly 40 % of Africa.These people suffer under corrupt governments who are suppressing growth and entrepreneurship -

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Last week, Trump allegedly questioned why US should accept more immigrants from Haiti, El Salvador and other ‘shithole countries’ in Africa, which honestly is a reasonable question. In all fairness, these countries are in one way or another not that desirable to live in. This, however, doesn’t mean the US or any other country shouldn’t accept immigrants coming from these countries just because they drew the shortest straw in the lottery of life. Most people in a similar position would try to amend their situation - and should be able to, especially considering the fact that half of the people in Haiti and El Salvador would, if possible, migrate to a different country and nearly 40 % of Africa.

These people suffer under corrupt governments who are suppressing growth and entrepreneurship - migration barriers cement these injustices into place and rob the people from the developing world of the opportunity for a better life. We should instead help them out of their dreadful situation and give them a chance to engage in free and voluntary trade in order for them to create better lives for themselves.

One of the things underlining this point is the wage difference. Because of the stifling governments and economies in the developing world, immigrants might see a twofold, a threefold or even as much as a thirtyfold rise in their wages, which emphasises the border discrimination going on and the huge missed potential. Some might object to this on the basis that, if we expand labour mobility from developing countries, there would be huge costs. But according to this paper, we could effectively substitute foreign aid programs with an increase in immigration and gain from it.

When the UK voted to leave the European Union, one of the reasons often stated was that the UK is able to create free trade agreements with other countries independently from the EU. But what featured more prominently in the Leave campaign was a focus on the return of control over immigration and, quite frankly, restrict it. Richard B. Freeman manages to sum it up in his paper:

The policy debate over globalization in the past decade has largely bypassed the international mobility of labor. Restrict trade and cries of protectionism resound. Suggest linking labor standards to trade and it’s protectionism in disguise. Limit capital flows and the International Monetary Fund is on your back. But restrict people flows? That’s just an accepted exercise of national sovereignty! During the last few decades, when most countries reduced barriers to trade of goods and services and liberalized financial capital markets, most also sought to limit immigration

For decades, economies around the world has become increasingly integrated and have accordingly liberalised trade. Yet one aspect of globalisation that hasn't received as much positive press as trade is immigration. The thing is, though, that maybe we should see free trade and migration as two sides of the same coin.

If we really want to prosper, free trade shouldn’t be the one and only priority. In fact, we could double the world GDP with less restrictive barriers on immigration policies contrary to the amount to be gained from the elimination of trade and capital barriers, which only constitutes a few percent of world GDP.

In addition, immigration might even foster trade between countries. In a study of the effect immigrants have on bilateral trade, the evidence shows that a 10% increase in immigration leads to a 1.5% increase in trade. What's true for immigration is also true for emigration. This is mainly due to immigrants lowering the transition cost through their knowledge about their home country which in the end has a positive effect on both export and imports. By contrast, immigrants preferences are only expected to boost imports through demand of goods from their home country.

So to answer Trump’s question: The immigrants from these countries are simply trying to do what those immigrants coming to America more than a century ago tried to as well. The fact that they are willing to chase that dream just goes to show that they are made of exactly the same stuff that the rest of America is built of. This is why the US should allow more immigrants from the so-called ‘shithole countries’. Instead of setting up new barriers for people trying to chase the American Dream, we should tear already existing ones down - life for everyone alike should be better with loads of opportunities to reach that goal. That is what the American Dream is about - opportunities, not barriers.

To finish off this piece, here’s a quote from a Republican hero, Ronald Reagan:

Many people are welcome in our house, but not the bigots.

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