Comments: Migrants make the revolving door spin

Ball of Confusion - Temptations (1970)

Posted by Mace at December 17, 2006 05:59 PM

David mentioned the fact that if an economic gain is created, some people will migrate towards it. At the moment Eastern European immigrant workers cannot claim "benefits". What happens after a year when they become eligible and a significant percentage realise that it is easier to live off benefit rather than work?

Posted by simon jenkins at December 18, 2006 01:09 PM

Thanks for the reminder about the song title.

As I understand it, A8 migrants are entitled to benefit after a record of 12 months uniterrupted work. So plenty should have passed that milestone, without a mass shift to claiming benefits. The risk, I suspect, would come with a big employment downturn here, when migrants could prefer to stay in the UK on benefits rather than return home.

Posted by David Smith at December 18, 2006 02:30 PM

"Set anything free — goods, services, capital and people — and you generate economic gains." Isn't that a bit of a simplification? Set the sale of heroine free and you would create a great deal of economic benefit for the dealers and growers at the expense of the users. Free markets are generally a good mechanism for price setting, but there are plenty of examples where markets fail and deliver sub-optimal results. The harm caused by massive low-skilled immigration is widespread and obvious, ranging from events like 7/7 to the degradation of inner-cities (just take a drive around East London if you need anymore evidence), and yet, there are still the "free-market" ideologues (who, not surprisingly, almost invariably come from those social groups most likely to benefit from unrestricted immigration) claiming that it's a net benefit to society.

Allow unrestricted flow of labor for unskilled jobs and you create economic benefit for some, but at the expense of many others. The main beneficiaries of high levels of immigration are the middle-class consumers of services that benefit from cheaper low skilled labor and existing home owners who see property prices appreciating, but that is outweighed by the losers: tax payers, users of government services, anyone who doesn't own a home, native born low-skill workers and the countries that are losing highly skilled labour as immigrants move to the UK.

For starters, allowing immigration into a country that offers generous (or at least semi-generous) benefits for the unemployed makes no sense. Sure, most immigrants aren't eligible for benefits, but native born workers who are eligible opt for benefits instead of working because immigration pushes wages down for low skilled jobs. Anyone who argues that this isn't the case is denying that the labor market is really a market. Then, of course, immigrants have children who are often poorly integrated into society,
are eligible for benefits, and use them, creating an entire cycle of immigration and welfare dependency. This is the most insidious aspect of British immigration policy, in that it represents a bargain between ideologues on the Left and the Right which undermines the future of the country. The Left gets generous funding for social welfare; the Right gets cheap low skilled labour. Tax payers lose out as they have to fund out of control social spending, and users of government services like education, housing and health care lose out as these services are over-stretched providing for immigrants.

Second, the belief that educated immigrants are simply replacing poorly educated native-born British is misguided on several fronts. I found both the IPPR report on migration and the response to it in the media very disturbing. There was a discussion of the meaning of the report on BBC Radio 4, but it mainly focused on whether British retirees would be happier in Spain or France, rather than the fact that large numbers of educated British are unable to find suitable employment here in Britain that would allow them to pay for the high cost of living. Britain is making a huge investment in human capital through the educational system that is being thrown away through emigration.

Education is a good that is poorly suited for free markets. There are multiple market failures, from the fact that end consumers (children) are not the decision makers (parents generally play that role) about how much and what type of education to consume, to the lack of access to private capital to fund investment in education, all of which means that education is largely purchased and funded by societies as a whole, rather than through free markets. Britain is funding an educational system designed to support a highly-educated, highly-compensated work force, with a commensurate rate of taxation, but a good portion of that human capital is being shipped off to Australia, Canada and the US to be replaced by low wage, low skill, low tax paying, immigrant labor. Combine this with the level of taxation required to fund non-working, native born labor and the high real estate costs created by immigration and tight building controls, and no wonder that middle class individuals can't afford to live in Britain.

Education is also far less fungible than imagined. Many of these discussions treat native born and immigrant labor as easily interchangeable, when they're not. There's a reason all these college educate immigrants are working in low skilled positions. A college degree in Pakistan or some other developing country teaches you nothing about the language, social skills, teamwork and leadership required to be successful at a high level in a British workplace. Many immigrants (not all, but the majority) simply aren't able to integrate into high level British jobs. At the same time, emigration of people who are viewed as highly-skilled in their native country, but end up in low skilled jobs in Britain, represents a huge loss of human capital for their native countries. Societies paying to educate their populace, only to see them move away to another country where they take low skill jobs, is a monumental market failure, even though the individual ends up better off. They only end up better off because they're not paying for the cost of their education.

I've always been intrigued by why it is that people come to believe so strongly in ideology. All evidence can point to an obvious truth, but ideologues insist the opposite is the "real" truth, and if society would just change itself to be consistent with the assumptions they've built into their model of how things should work, then their theoretically correct answer would be right. Immigration is the perfect example of this. The harm is staring everyone in the face, but no one will admit it.

(OK, yes, I know this is a tirade, but it seems necessary in this case.)

Posted by RichB at December 20, 2006 08:01 PM

YOUR KIDS FUTURE

This is an editorial on the web site economy in crisis. Do you think Americans should be concerned with our kid’s future due to poorly negotiated trade and immigration policy?

PREPARE YOUR KIDS FOR THE FUTURE — AS A SERVANT

EC-In 1994, more than 1 in 8 jobs in America was in manufacturing. In 2014, if US government (Bureau of Labor Statistics) projections are to be believed, that figure will have slipped to less than 1 in 12.

The government is actually telling us in black and white that the policies that they are enacting will decrease absolute and relative manufacturing employment to levels below that of the 1950’s – over 2 million jobs below. In the 1950’s, 30% of US employees were in manufacturing – almost one in three jobs! This country was a relative manufacturing superpower.

In less than 20 years since America put in place some of its most self-devastating policy decisions (NAFTA, WTO, CAFTA, etc.), this country will have almost completely converted from a self-sufficient sovereign state, capable of manufacturing what it needs to sustain and protect itself, to a country of servants – serfs, working at the behest of foreign employers or engaged in the sales, marketing, and distribution of foreign-made goods – working at their discretion, for wages they determine, and forced to pay their prices for needed goods. This is the definition of a servant.

Posted by John Konop at December 21, 2006 09:29 PM
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