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Ignorant Immigration Reform

David Bier

This week the Republican senators Tom Cotton of Arkansas and
David Perdue of Georgia introduced a bill that they said would cut legal immigration to the United States
by 50 percent. They are right about that, but nearly everything
else that they have said about their bill is false or
misleading.

The senators, whose bill is endorsed by President Trump, argue
that America is experiencing abnormally high immigration; that
these immigrants are hurting American wages; and that their bill
would prioritize skilled immigrants, the way Canada does, thus
making the United States more competitive internationally. These
talking points are pure fiction.

They have justified this drastic cut in immigration by stating
that the bill will, as they put it in February when announcing an earlier version, bring “legal
immigration levels” back down to “their historical
norms.” But the senators fail to consider the impact of
population growth. A million immigrants to the United States in
2017 isn’t equivalent to the same number in 1900, when there
were a quarter as many Americans.

A smart reform would
double green cards and peg future work visas to economic growth,
responding to market forces rather than political whims.

Controlling for population, today’s immigration rate
is nearly 30 percent below its
historical average. If their bill becomes law, the rate would fall
to about 60 percent below average. With few exceptions, the only
years with such a low immigration rate were during the world wars
and the Great Depression. Surely, these are not the
“norms” to which the senators seek to return.

Senator Cotton is trying to connect a slow increase in the immigration rate
in recent decades to declining wages for Americans without a
college degree, implying that low-skilled workers are facing more
competition for jobs than in earlier years. But this correlation is
spurious, because it ignores the size of the overall labor
pool.

Looking at all new job seekers — born here and abroad
— actually reveals a significant decline in new workers
competing for American jobs. During the postwar period from 1948 to
1980, as incomes rose for all workers, the labor force grew by 76 percent, driven largely by baby boomers and
women entering the labor force for the first time. Since then,
declining birthrates have led to about half as many new competitors
entering the labor force each year, despite many more
immigrants.

Less-educated Americans also faced less competition. The ranks
of on-college educated workers swelled 50 percent
in the postwar period, compared with just 16 percent in recent
decades. During both periods, high school dropouts saw a near
continuous decline in labor market competition — from workers
born here or elsewhere. In contrast, college graduates actually
dealt with more competition than they had before.

All this suggests that the stagnation of wages has other
origins, such as new technology and the increasing burden of regulations, not more job seekers
immigrant or otherwise.

The senators’ analysis suffers from similar confusion when
they say that their bill would create a system
modeled after Canada and Australia. Controlling for population,
these countries accept two to three times as many legal
immigrants as America.

A related fiction is that the bill would
“prioritize” skilled immigrants. In fact, it contains
no more visas for skilled workers than our current law does. All
the bill would do is cut the number of visas for the family members
of United States citizens. Canada and Australia prioritize skilled
workers by allowing far more of them to come — while also
accepting more family members than we do.

Canada and Australia aren’t the only ones surpassing us in
terms of welcoming immigrants; 17 developed countries accept more
legal immigrants as a share of their population than does the
United States. This places the United States at an economic
disadvantage in the global race for talent. For years, Canada has
attracted skilled immigrants from America, and Microsoft even
opened an office there specifically to take advantage of its
system.

In other contexts, Senators Perdue and Cotton have often discussed how America’s tax and
regulatory policies send jobs overseas. But micromanaging labor
markets from Washington has the same damaging effect, pushing
businesses away from the United States and hurting those that
remain.

Rather than cutting immigration, Congress should raise the
employment-based quotas, which it has not adjusted since 1990
— when the United States had some 77 million fewer people and
the economy was half the size it is now. A smart reform would
double green cards and peg future work visas to economic growth,
responding to market forces rather than political whims.

Smart reforms, however,
require that Congress first understand the basic facts: America has
not seen a deluge of immigration. Low-skilled American-born workers
have not faced more competition for jobs. Other countries accept
more immigrants per capita. Until these facts penetrate the halls
of the Capitol, the immigration debate will continue to be mired in
ignorant proposals like this.

David Bier is a
policy analyst at the Cato Institute.