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Immigration: Give the Private Sector a Bigger Role in Deciding Who Comes Here

Summary:
It's become common now to read arguments claiming that immigrants — broadly speaking —  are good for the economy, or good for "America" in some other fashion. "Migrants and refugees are good for economies," Nature magazine claims. "Open Immigration Is Good for the Health of People and the Economy," another writer claims. "1,500 economists to ...

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It's become common now to read arguments claiming that immigrants — broadly speaking —  are good for the economy, or good for "America" in some other fashion.

"Migrants and refugees are good for economies," Nature magazine claims. "Open Immigration Is Good for the Health of People and the Economy," another writer claims. "1,500 economists to Trump: Immigrants are good for the U.S. economy," CNN insists.

Now, I'm not one to argue against freedom of contract and exchange between US citizens and foreign nationals. In other words, if a private employer wishes to offer a job to a foreign national, that foreign national should be free to accept. Similarly, if an American landlord wants to enter into a lease agreement with a foreigner, that ought to be the landlord's prerogative.

Note that in these cases, however, the private parties involved are specific individuals. The landlord and the employer have not entered into agreements with some vague concept of "immigrants." They're doing business with certain individuals who happen to be immigrants.

At the heart of this reality is a very important fact: immigrants are not homogeneous. Each person has different skills, different needs, and different luck. Moreover, immigrants aren't even homogeneous within certain national groups. An English-speaking middle-class non-felon from Mexico clearly has little in common with a gangland assassin from the same country.

Thus, we cannot say that immigrants in general are good for the economy or good for anything else. Some are. Some aren't.

For this reason, it would of course also be factually incorrect to say "migrants and refugees are bad for economies," or "immigrants cause crime" or "immigrants are a burden on the public purse." No doubt this is true about some immigrants.But it's certainly not true of all of them. Thus, every time I see a headline that blares "Immigrants are good for America," I wonder: "Do they mean all of them?"

But which ones are delightful neighbors and customers, and which ones are future drains on the taxpayer?

This has always been the central problem of immigration policy.

A Different Approch

Contrary to myths about the United States having totally open borders in the nineteenth century, many US states did, in fact, employ a variety of legal schemes to prevent entry to certain immigrants who were thought to be paupers who would be a drain on the public purse. (States did this because most people at the time agreed the federal government was not granted power of immigration matters.) New York and Massachusetts were especially notable for efforts to refuse entry to certain immigrants thought to be unemployable.

[RELATED: American Immigration Policy 160 Years Ago by Ryan McMaken]

These laws go back to colonial times — and even to England — where poor laws were devised to prevent outsiders from settling — uninvited — in a new village or district where they could then exploit poverty-relief resources intended for the locals.

It was not until later that the Federal governments began to set overall quotas and to even base immigration laws on country of origin rather than on the specific traits of immigrants.

Thus, from the 1880s onward, the Federal government increasingly began to adopt a prohibitionist approach, the most notable instance of which was the Chinese Exclusion Act of 1882.

Quota systems like this, however, have always smacked of central planning and anti-capitalism. They engage in wholesale prohibition and regulation of entire classes of immigrants, regardless of the wants or needs of native employers, families, and charitable groups who might be interested in hosting these immigrants.

A wholesale ban on immigrants from Country X is about as compatible with a free economy as is a ban on imports from Country Y. It's nothing more than a case of politicians deciding arbitrarily what sorts of economic activity Americans will be allowed to engage in.

Moreover, even in the days when states attempted to refuse entry to suspected "paupers, vagabonds, and possible convicts," entry could sometimes be dependent on the use of bonding. In these cases, those those who attempted to "import" immigrants were required to post a bond under which the state could be compensated in case the new migrants ended up on the dole — whether in prison or in the poorhouse.

[RELATED: "Only the Private Sector Can Determine the "Correct" Number of Immigrants" by Ryan McMaken]

Reasonable Americans recognized that while some immigrants might bring risks to the native population, many did not. This, incidentally, is true of all imports, human and otherwise. After all, agricultural imports have always brought with them the risk of invasive species or diseases that threaten native crops. The response to these threats has been to address the risky imports without banning the good.

In a modern context, resurrecting and emphasizing strategies like these — while eschewing a prohibitionist approach — would help to lessen the role of the state in the lives of both citizens and migrants alike. 

For this reason, immigration policy ought to be adopted to allow for more flexibility, free association, and market exchange, while still addressing issues such as criminality and what was once called "pauperism":

  • Expedited or immediate entry for any immigrant who forfeits all access to publicly funded subsidies and amenities including public schools, Medicaid, and similar programs.
  • A sponsorship, bonding and "adoption" program for private individuals, employers, and charitable organizations who are willing to financially "vouch" for immigrants. Should these immigrants turn out to be criminals or users of public funds, the sponsoring entities will be held liable. Immigrants who can find no sponsor in these situations will be deported.
  • Abolish immigration ceilings, but restrict entry to immigrants who are sponsored and bonded, have forfeited access to public programs, or who can demonstrate financial independence.

The goal is to allow for greater freedom for American citizens to engage more freely in trade and other exchanges with immigrants worldwide, while also limiting the risks to taxpayers. This also naturally limits the total volume of immigration — without arbitrary government ceilings — since sponsorships and bonding will be limited by the availability of private resources.

This plan, of course, will fail to please those anti-immigrant enthusiasts who simply don't want any freedom of movement across the border at all. They think their personal feelings about American demographics and culture justifies using the power of the federal government to override private agreements and free association. On the other hand, this plan will also fail to please those Americans who are dedicated to maximizing the inflow of immigrants for ideological and political reasons. For them, immigration is a means of re-shaping American culture to better suit their preferences. And the more it's subsidized by government, the better. Both sides look to government to force their own immigration preferences on others, and to override the decisions of the private sector, which the activists on both sides mistrust.

For a great many Americans, though, their concerns are often limited to fears about criminality and strains on taxpayer-funded resources. But as with so much else, these problems can be addressed by moving more in the direction of private markets and allowing immigration flows to be determined more by the private sector, whether for-profit or charitable.

Ryan McMaken
Ryan W. McMaken is the editor of Mises Daily and The Austrian. He has degrees in economics and political science from the University of Colorado, and was the economist for the Colorado Division of Housing from 2009 to 2014.

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