Last week, I participated in an immigration panel that also included Kansas Secretary of State Kris Kobach, at the Conservative Political Action Conference (CPAC) in Washington, DC. I spoke before Mr. Kobach and laid out a case for why conservatives should support increasing legal immigration. I compared our immigration system to Obamacare by saying, "The prime complaint against Obamacare by conservatives is that they don't think that the government should get between a patient and their doctor. So why should the government get between an employer and employee just because one of them is from a foreign country?"
Kobach expressed the opposite point of view. There was no time at the end of the CPAC panel for rebuttals, so I'm doing that here. Kobach stated, "If you really want to create a job for a U.S. citizen tomorrow, deport an illegal alien today." He then argued that recent unemployment numbers in Alabama support his contention. Who knew it was so easy to decrease unemployment -- just get rid of people!
Kobach's statement is a perfect example of what economists call the lump of labor fallacy, which holds that there is a fixed amount of work to be done in an economy and therefore a fixed number of jobs. However, there is simply no limit on the amount of work to be done. Ever. What matters is the price and the expected benefits of that work. Eliminating workers from the economy doesn't free up opportunities for others. Instead, it limits how much the economy can produce because it decreases the number of workers. That in turn slows economic growth and dampers demand for workers.
Further, the unemployment data that Kobach cited do not support his contention. As he noted, Alabama's unemployment rate went down after the state passed its strict anti-immigration law (HB-56) in mid-2011. But that doesn't demonstrate anything about the Alabama immigration law, because unemployment for the entire nation dropped by almost a percentage point and most other states aren't following Alabama's immigration policy. Alabama's own experience doesn't even confirm Kobach's point. The unemployment rate in Alabama decreased by an entire percentage point between September 2009 and August 2010 without HB-56.
The truth is that many more things affect the unemployment rate than immigration, including the price of electricity, regulatory rules concerning international investment, tax rates, and myriad other laws and real economic changes. It makes as much sense for President Obama to credit his unpopular health care law for the decreasing national unemployment rate as it does for supporters of HB-56 to claim that it is responsible for Alabama's improving situation.
It's also noteworthy that Kobach did not cite Arizona's economic experiences. Arizona's first restrictive immigration law, the Legal Arizona Workers Act (LAWA) went into effect on January 1, 2008. Within six months of LAWA going into effect, the unemployment rate in Arizona shot above the national unemployment rate and has stayed there since (with the exception of a single month).
Part of the reason for that is LAWA mandated E-Verify, a federal government-run electronic employment verification system designed to weed out undocumented workers by requiring all employers to feed the identity information of every prospective employee into a federal database.
E-Verify imposes a large cost on businesses and legal American workers. It is effective at deterring some unauthorized immigrants, but it is also effective at driving a lot of them deeper into the grey-market cash economy. In the year following the implementation of LAWA, only half of the total number of hires in Arizona used E-Verify. Not only that, it falsely tagged about 1 percent of legal American workers as unauthorized where actually used.
Pundits like to separate legal and unauthorized immigration into different categories. But solving the illegal immigration problem requires solving the legal immigration problem. If a quick and legal pathway to immigrate similar to Ellis Island were revived, unauthorized immigration would virtually disappear -- and with it the anti-immigrant vitriol and constant push to punish our economy with Arizona and Alabama-style legislation.
I got a mix of boos and cheers from the audience for laying out the conservative case for increasing legal immigration. Many people also came up to me afterward to discuss my remarks. One young man said he was worried about the Republican position on immigration. He said he thought it was turning the party into anti-capitalist nativists. He's not the only one worried.