Immigration, the drug war and unintended consequences

There was this article in the Arizona Republic today about many of the negative and unintended consequences of enforcement only strategies to problems like immigration. There is a very simple economic principle at work on the border. The demand for immigrant labor is largely unchanged (perhaps the Employer Sanctions law will change this?) while the supply is being affected. The anti-immigrant folks will say this is exactly what they wanted. They will say less supply is good, but the problem is that as supply decreases the costs and profitability per person smuggled increases. This leads to greater violence on the border and in our cities as smugglers protect their cargo and profits.

If you are a smuggler you might not be willing to get in a shootout with police over 10 recently smuggled immigrants at $500 dollars a head, but what happens when the price increase to $3000 to $4000 per person? This leads to other smugglers protecting their routes with violence and increases the incentive to kidnap immigrants mid-smuggle.

We have had this same problem with our disastrous drug war. When our public policy is formulated we are not considering the incentives we are creating. Worse yet, we do not try to create the right incentives to bring about our desired goals.

The Employer Sanctions law could be a step towards decreasing demand if it were formulated correctly, but I suspect it is more likely to create a larger underground economy where companies will just pay people off the books to avoid the law. We may very well end up with nearly as many immigrant laborers who paid significantly more to get here and then are forced into worse working conditions in an underground economy. The result will be stronger more profitable gangs of smugglers, a poorer immigrant labor force with a greater likelihood of exploitation and a loss of the current revenue (SSN, Medicare, Fed and State) being collected (I know you anti-immigrant people don’t like to hear it but undocumented workers pay billions into programs like Social Security with no hope of collecting any benefit).

There is a lot of doom and gloom predicted with the Employer Sanctions law (and I don't mean the negative affect it will have of the lives of immigrants already here). I am still not convinced that the sanctions law will devastate the economy. If the immigrant labor force shrinks during an economic contraction (which I think we are entering, especially in construction), I think it may not have a great effect right now. However, it may adversely affect any recovery. It is hard to recover when there is insufficient supply of labor for the activities necessitating a recovery. The economy does not turn on a dime. If there was less immigrant labor inevitably, native born US citizens would fill those jobs, but only after pay and costs rise. I don't buy the they do jobs that Americans won't argument. Having said all of that, I think I share a feeling not uncommon among liberals who completely distrust the authors of this law to be fair and judicious in the intent and execution of this law. I don't trust their aims or motives nor do I believe they have the best interests of this state in mind.

I have been mostly addressing economics in this post, but we cannot overlook our responsibilities as human beings to be compassionate towards the people that live and work beside us. No policy discussion should ignore or fail to acknowledge the humanity or the struggles of the immigrants that have come here seeking a new and better life. They are here because of our policies (and our policy failings) and we have the ultimate responsibility for that.

Immigrants won't learn English (because they are afraid to go to class...)

I know you have heard about how all of those awful immigrants just will not learn English and will not assimilate. Then there is this from the Arizona Republic. (Pssst, anti-immigrant people, the best people to get people to learn English is to teach them English). Logical people they are not...

We don't want you here (Unless you want to fight in Iraq)

This article from the Arizona Republic is fascinating. Most people do not know that you can serve in the military without being a citizen. The irony here is that the same people who seem to hate the immigrants coming here from Mexico are the same people who are supporting Bush's war and surge. I wonder how they will reconcile this one? Are they against citizenship for immigrants that took their place in Iraq and fought for the policy that they support?

Who I am kidding, of course they will not have a problem reconciling that, they still think Saddam Hussein was responsible for 9/11.

Judicial Watch Goes After the Mayor (Judicial Watch is High)

I do not know how many of you remember Judicial Watch, but they are the guys that did their best to bring down Bill Clinton over every unfounded half truth they could dig up. Now they are going after the Mayor (Phoenix Mayor Phil Gordon) with a similar frivolous lawsuit.

Let me get this straight, the Mayor figured out a way to fix a problem without legislation. He did it by striking a compromise between two groups and now he is being sued for it? This is precisely the sort of thing a city mayor should do. Isn't it ironic that they filed their complaint with Sheriff Joe...

I happen to be very familiar with the area that they are complaining about, I was there yesterday to buy paint. I have been there many times over the past few years (it is the busiest Home Depot in Phoenix). Two years ago there were 40 to 50 day laborers near Thomas Road looking for work, now there are almost none. I drove by there this morning for good measure and I did not see a single day laborer.

I won't even get into the issue of whether they should be there, but it certainly seems that the lawsuit is off base. If the anti-immigration people were a little more based in the real world, they would realize that day laborers are in demand and they will not go away just because they want them to. The best solution is to provide a day labor center, but either way they are not at the Home Depot on Thomas anymore...

NAFTA and the Teamsters

Here is an article about the Teamsters trying to stop the Bush Administration from allowing Mexican trucks full access to the United States. It seem patently unfair to allow Mexican trucking companies into the US and not forcing them to follow US law.


It is time for our leaders to stop selling out the US through International agreements. There are two ways to do free trade, the first is the race to the bottom where everyone relaxes regulations and safety to become competitive at the expense of workers. Or there is an untried model where we uniformly raise standards as a condition of trade. The first, I would argue does not work very well when it comes to protecting the environment, consumers or workers, so maybe we should take a look at the second?


Just to be clear, I don't have a problem with the Mexican truck drivers. I just would like the regulations applied evenly. The same goes for any immigrant labor... Applying things like minimum wage laws to everyone protects both immigrant laborers from exploitation and provides a level playing field to American workers to compete.

Hepatitis at Cheesecake Factory: There is a moral to this story

As many of you may have heard, there was an outbreak of hepatitis A at the Cheese Cake Factory in Phoenix. This got me to thinking about a couple of policy issues that people do not like to talk about rationally. The first issue is related to immigration. This is precisely why you don't want to cut off healthcare services to anyone. Obviously, a sizable portion of the restaurant industry is run with immigrant labor. Guess what, the people that make and serve your food make minimum wage, do not have health insurance and do not get paid time off (and that is the American citizens). Forcing immigrants underground is dangerous from a public health standpoint.

The second issue is the problem of every worker in the economy not having paid time off for illness (let alone recreation). I for one would be willing to pay a few more dollars for my pasta and cheesecake to insure that the person serving it could stay home with pay when they are sick. The simple fact is that many restaurant workers are a few days wages away from losing their apartment or car. Given the choice between working sick or giving up a day's salary, most people will work sick.

This is just another reason for universal healthcare and increased workers rights. Rather than spreading to costs to a few unlucky patrons, perhaps would should rationally spread the costs across our society...

Whoops, The Report was Only Off by $700 million?

Here is an article buried in the Arizona Republic about how the report from the Udall institute sites by Robert Robb here was not just 'revised' a little.

University of Arizona researchers understated the amount of state taxes
generated by immigrants by more than $700 million in a study released July 11,
they said Friday.

This still doesn't take into account the other economic impacts I site here. To me, this shows two things: One, how difficult it is to measure the economic impact of a large group of people. Two, everyone should be sceptical of data cited anywhere to support a political agenda (including here, Hell, especially here).

Robb, Please Tell the Whole Story...

Our good friend Robert Robb at the Arizona Republic latest column is about the economic impact of immigrants and undocumented workers. The reason I bring this up is not as much about immigration as it is the incorrect use of statistics. I have a problem with cherry picking data and brushing aside flaws to make an argument.

He makes a rather simplistic assessment full assertions to strengthen his argument, but makes no effort to backup anything with facts. He says:

I understand that the Udall study will be revised to increase the calculated tax contribution from illegal immigrants, but an argument can be made that the current figure is already overstated. It includes not only taxes paid directly by illegal residents but also the taxes paid by others supposedly as a result of their economic activities.

Additionally, education expenses are substantially understated.

Ok, great point, but where is the factual basis?

My other big problem beyond the assertions, is that the review is simplistic. The economics are much more complex than inputs and outputs for government services. In the end, immigrant labor amounts to a subsidy to those who benefit. Housing construction is less expensive, fruits and vegetables are cheaper to produce and so on. You cannot measure the impact of immigration without assessing its true economic impact.

What we are doing is transferring money from government coffers (greater use of government services by immigrants) and from the workers (in the form of depressed wages) to the profit margins of the companies (who use immigrant labor) and into the pockets of everyone who benefits from lower prices. What is bad about the system is that the benefits are unevenly distributed as are the costs. The system is great if you are building a new house or own a landscaping company, but really crappy if you are an unskilled laborer. I am not making a value judgement about immigration or immigrants just trying to state the reality.

As to the overall impact of immigrant labor, I think it is safe to say that we would survive without it. I would probably survive a gun shot to the shoulder or leg, but I prefer to not experience it. Furthermore, it is always easy to dismiss the pain involved with a policy that does not really affect you. How would you transition business dependant on the labor? What about landlords renting to the people you would deport? Would you deport someone with a child that is a US citizen? How about a husband and wife where one is a citizen and the other is not? What if you have a mixed marriage with a citizen and non-citizen with children who are citizens and the non-citizen is the primary bread winner for the family?

Can we get to point where we agree that immigration is not black and white, but many shades of grey?

The Republican Coalition is Falling Apart

The Arizona Republic has a great article about how business interests (that almost always support Republicans) are creating political action committees to go after the very Republicans who passed the employer sanctions law. It is certainly a good thing for us...

Too Obvious to Deny

While I was reading this article from the East Valley Tribune on the new employer sanctions law, two things came to mind. One, part of the sanctions law passed by the Arizona Legislature should have included a provision to punish employers who mistreat undocumented workers. I think one of the unintended consequence of this law will be to force workers further underground and lead to abuse of workers by unscrupulous employers.

The other idea is where my mixed feeling on immigration come in. Cheap labor is wrecking parts of the economy for a certain class of people in the US. The anger over immigration comes from a lot of sources, many of them unjustified. However, many of us on liberal side of the spectrum forget the affect immigration has on workers that are not college educated or highly skilled. This is a real problem...

There are many potential solutions: Provide easier access to education and skilled training programs, apply the minimum wage to undocumented workers, etc. The point is that if we want cheap labor, we must find ways to take care of our displaced fellow citizens. At the same time, we cannot tolerate racist, demonizing or inhumane treatment of immigrant laborers.

Oh, and one last thing, I am really sick of hearing that immigrants are doing the work that Americans do not want to do. I think this quote says it all...

The law could have a chilling effect on the state’s entire economy, warned Elliott Pollack, one of the state’s top economists. The law will certainly make it harder for the agricultural and hospitality industries that depend on illegal immigrants to fill jobs. This will force businesses to pay more for employees living here legally, he said. And that extra cost will be passed on to consumers.

Would that really be so bad?

Employer Sanctions and Law of Unintended Consequences

Here is an interesting article that gives details about the funding of the new employer sanctions law passed by the Arizona Legislature. I will give you one guess about whether our legislature properly funded the bill. Of course not... I know that many of you out there are against the legislation and I am frankly not sure myself, but here is the problem. Uneven enforcement of this type of law is worse than no enforcement especially in the hands of our good friend Andrew "I am nut" Thomas.

Here is the problem as I see it. Many businesses rightly or wrongly rely on immigrant labor. They are not likely to change their business practices without fear of a likely enforcement action. Imagine you own a business that relies on inexpensive labor to be competitive, you face a choice: comply with the law and see your business become less competitive or ignore the law and gamble on the lack of enforcement.

The lack of funding also sets the scene for selective enforcement. Imagine you live in a place where the Sheriff and the County Attorney care more about publicity than actual law enforcement. Add a County Attorney that wants to run for higher office. Mix in a couple of million dollars for enforcement of a law that affects 10% of our workforce and what is a likely outcome? A few unfortunate people (probably running small businesses) will feel the brunt of the law, will be marched out in front of the cameras (while the biggest offenders in the Wall Street Journal wing of the Republican Party laugh at the poor suckers without connections) and in the end, the law will not change behavior in any significant way.

It just goes to show that most Arizona Republicans are all flash and no substance...

Flores and why the Right are a bunch of hypocrites

The Arizona Republic has this article about the Flores case. I am not going to rail against the stupidity of the legislators over this case, although it is rail worthy. What struck me as I read this was how the right ignores reality and pushes toward hypocrisy.

For example, on teenage pregnancy they don't want sex education (where they actually teach about sex), they insist on abstinence only education (fantasy land). On abortion, for the most part the right-wing doesn't actually want to take actions that would decrease the number of abortions (like supporting children and single mothers or providing adequate birth control). Instead they just want abortions to stop (fantasy land). We are clearly losing the war in Iraq, but instead of admitting mistakes and adjusting (not now, 2 years ago), they just think they can will victory through some combination of getting tough, taking the gloves off, sending more troops or praying to Jesus (fantasy land). I could go on...

I know this idea of the right being divorced from reality is not new, but how do we as a community combat it (or explain it and understand it)? The petulance of our legislators is just another case of this divorce from reality. They want English to be the official language. They insist that immigrants are not doing enough to learn English, so what do they? Shut down adult language education and under fund programs for kids trying to learn English (don't even get me started on deporting 12 million people). They always say they want to run government like a business, but no business would operate this way and survive...

Immigration or slavery?

This article from the Arizona Republic has an interesting bit about some nice white Canadians who might be asked to leave when their visas run out. The immigration issue is particularly hard to talk about and I usually like to avoid it.

I am torn about the issue. On one hand, I live in a neighborhood that is about 50% Hispanic and some are clearly undocumented. As far as I can tell, the ratio of jerk to nice is about like anywhere else.

The problem I have is that we should have a rational policy outlining both what we want and what is realistically possible. I don't think it is healthy for large scale immigration to happen quickly. It causes far too much stress on communities. How do we manage that and still treat the people coming here like human beings who deserve respect?

The really interesting thing in the article for me is the provision in the new immigration bill that makes immigration merit based. I think this is generally a good idea... We should steal the best and brightest from around the world whenever possible, but does that mean that the rest of the immigration will slow down? I don't see how.

Perhaps the scariest thing (this is where my title comes from) is how businesses want immigrants tied to them. I have seen this in action with H1B visas. It is not a good system. I worked with two employees on H1B visas at a previous job. They are what I would call high-end slaves. They are paid below market and made to work longer hours because they do not have options since their employer helped to establish their immigration status.

I cannot imagine how bad it will be for people picking fruit, working construction or processing chickens. The H1B workers are generally doing clerical or technical work. They have a low risk of injury even when they are exploited, but manual labor workers are put in real danger. There is also the problem of no paid time off for people working in kitchens or working with food of any kind. A lot of people get sick because of the poor line cook at Applebee's that doesn't get a sick day...

Tying workers to businesses is a bad idea... How about letting legal workers operate in the labor market like everyone else? Oh, I forgot that would mean businesses could not suppress wages artificially and leave plenty of cash for huge executive compensation packages.

A reader posted this link on H1B visas. This is fascinating and scary stuff. Everyone should take a look...

Republic Resident Robb Misguided toward Reid

I apologize for the alliteration, but I couldn't resist. So our resident dying breed moderate Republican, Robert Robb (Arizona Republic) wants to blame Reid for the failure of the immigration bill here. It is an interesting theory and by interesting I mean wrong and kind of stupid. Maybe (I don't want to go out on a limb here), it is the fact the Republicans are apoplectic about immigration in general? Maybe it is the fact Mr. Robb, that your party is filled with extremists that long ago stopped being rational actors intent on improving their country. Maybe, Reid would not have to pull the bill if a couple more Republican votes could be wrangled, but we all know the chances of that... Your party would rather operate in the world of myth: evolution is just a theory, global warming doesn't exist, deficits don't matter, we are winning the war in Iraq and we will just deport 12 million people because they are "law breakers". Your party's simplistic view of the world is the problem. Instead of attacking Harry Reid for trying to do the right thing and carry your President's water on the issue (because Republicans could not pass it during nearly six years of one party rule), maybe Mr. Robb you should look inward. The Republican Party is broken and to use the parlance of your party, bad for America. This was not always the case, but certainly is now...

There needs to be real debate about immigration

I guess I am the rarest breed of political animal, a moderate on immigration. I tend to lean toward the pro-immigration side because the anti-immigrant people tend to use demagoguery and false information to forward their cause. I don't believe the immigrants are the root of all evil like the Russel Pierces of the world. There is this article from the EVT today about a study that sheds some light on reality.

Immigration is a mixed bag, but I suspect it is largely more positive than negative in economic terms. Immigrants pay taxes, social security, medicare and they receive very little for their money. They also provide services at a greatly reduced rate. It has always seemed a little funny to me that the people most against immigration tend to live in recently constructed McMansions most likely built by immigrant labor.

Here is where I differ with some pro-immigration people: Americans would do the jobs that immigrants are doing, but they require a livable wage and safe working conditions. I admit to a little frustration about the language barrier that sometimes exists. I try to remain sanguine and I do wish I spoke Spanish well enough that it did not matter. I am annoyed when I see bill boards or signs in Spanish only. I don't mind bi-lingual.

What is my point here? We as a society need to decide what we want. We cannot have endless supplies of cheap labor and the benefits that result without paying for some increase in the cost health care and education. In other words if we enjoy the benefits, we have a social responsibility.

In economic terms, the people with the cheap services are really just shifting their burden to other people. It is important for everyone to remember that immigrants are people. It is too easy to demonize someone who has less power and is different. Resist the temptation. Also, they are from a different culture, deal with it. Is it sooo bad to hear different music or deal with slightly different social morays?

Is this the best way to deal with the Minute Men?

Kirsten Sinema, the very liberal (in a good way), legislator from District 15 has proposed this bill to try to curtail the activities of groups like the Minute Men. I have to admit that I don't always agree with her, but damn do I respect her moxy, not to mention her total disregard for getting reelected.

The bill would basically target non-law enforcement people on armed patrol. I have a little trouble with all of this... I am conflicted... On one hand, I don't care for the Minute Men. I think that for the most part they are reactionary, unhelpful and many of them are racists. However, I am not sure I am comfortable going after these sorts of groups in this fashion. It strikes me as, well, a little unamerican. I disagree with them, but support their right to act dumb. However, I am also trouble by armed idiots patrolling the border. Then, there is the issue of fanning the flames of this whole debate in an unhelpful way.

I am not sure of the right answer, but I feel pretty sure that this is not it.

The unintended consequences of dumb policies...

I have often thought of how under reported and under-communicated the law of unintended consequences can be, especially on "get tough" policies. There are the policies from the drug war that have done little to curb drug use (but run up a huge enforcement and incarceration bill). The most relevant at the moment are the anti-immigrant policies being passed in AZ. There is this brilliant article by the Naked Economist about the unintended consequences stemming from policies that attempt to control behavior. consequences

The simple fact is that no matter how tough we get on immigrants and immigration, we will never be able to remove the incentive to come here for work (feeding your family is strong motivation). The unintended consequences of cutting off things like healthcare, education or forcing local police to arrest people here illegally are pretty dire.

Cutting medical care (besides being inhumane) opens our society to a large migrating group of people who could carry disease from place to place without it setting off alarm bells. If there is an outbreak of TB, you want the people going to the hospital, so it can be controlled. Taking away education just leads to frustration which will lead to greater crime and violence. Making local police immigration enforcement means that a lot of crime in immigrant communities will go unreported and will likely grow.

These ideas are counter-intuitive at times. I know they can be tough pills even for reasonably moderate people to stomach, but sometimes it is better to be rational than reactionary.

I think a lot of the anti-immigrant sentiment that exists is the result of middle class people feeling uneasy and squeezed. That anger gets projected onto the immigrants that don't really have a means of speaking up. Conveniently, immigrants become scapegoats for nearly every ill: terrorism, expensive healthcare, taxes, crime etc.