America, Keep Immigrants Coming!

People who immigrated to the U.S. miraculously improved their lot relative to their peers who stayed behind, while creating wealth in the U.S. The miracle emerges when their energy meets the enormous opportunity afforded by U.S. equality.
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Protest march
Protest march

The recent violence in Pairs by immigrants or children of immigrants has heightened concern about the policy of welcoming immigrants to a country. Together with concern about scarce resources and depression of workers' salaries, such events may increase anti-immigrant sentiment in the country. However, the US is a powerful nation today, not despite but because of immigration. To really appreciate this fact, reconsider these three concerns about immigration with benefits that immigration brings: stimulus to the economy, stimulus to innovation, and opportunity for millions.

The biggest concern about immigration is that immigrants could increase social tension by living in ethnic enclaves, speaking a foreign language, not integrating with locals, and aligning with terrorists. For the US, the experiment regarding social tension has already been run. Over, the last two and a half centuries, millions of immigrants from numerous countries have come in large numbers. They have lived in their own communities, spoken in foreign languages, and not fully integrated with locals, at least in the first generation. But they have rarely or never created sufficient conflict to justify closing the doors to further immigration. Conversely, within the second generation, immigrants have adopted English as their mother tongue, married into other ethnic groups, fully assimilated into the American culture, and enriched American culture with their values and heritages. American equality, institutions, and culture have created the world's largest melting pot.

Some critics fear that if the US admits millions into the country, the nation will use up scarce resources. More houses will have to be built, trees cut down to build them, land used for houses and crops, and water consumed for trees, crops, and daily living. Can the US really afford that given it already has 310 million people? An easy answer can be found from a ranking of major economies on density. Japan ranks 38th (with 873 people per square mile), UK ranks 53 (660 people per square mile), Germany ranks 53 (593 people per square mile), and China 80 (368 people per square mile). In comparison, the US ranks 179th on this list (83 people). Relative to the major economies of the world, the US is the least dense. Reasonable immigration will not put a strain on resources. Moreover, people are a country's greatest resource.

The biggest critique of immigration is that it depresses workers' wages. Unions insist that the danger is real. Bypassing economists' models, two simple observations of daily life in the US shed light on this issue. Two types of immigrants dominate in the US today: Under-educated, under-skilled peoples fleeing poverty in their home country and highly-skilled, highly-talented people fleeing to the US for premium wages. The former group takes up jobs that locals do not want: hard labor in fields, cleaning in hotels, restaurants, and homes, and low-paying low-skilled manufacturing jobs. The latter group takes up jobs for which not enough local talent exists: nurses, doctors, engineers, programmers, etc. Both groups of immigrants ensure the supply or low costs of products and services that might otherwise be unavailable.

Immigration is a stimulus to the economy. Growth is the single most important factor for the health of an economy. It ensures that people do better each year than they did the prior year. Growth over long periods of time ensures that each generation does better than the prior. Immigration contributes immediately and enormously to economic growth, because immigrants consume as well as produce all manner of goods and services. In developed economies, birth rates are rather low, stymieing one important source of growth. However, immigration can compensate for a low birth rate. Further, because most immigrants to the US are young, they often bring decades of labor to support an otherwise aging population. A comparison of the economies of Japan and the US illustrates this point. Economic growth in Japan is stagnant primarily because of low birth rate and little or no immigration. Economic growth in the US is fueled in considerable part due to a higher birth rate and much higher level of immigration. A historical comparison of the US with UK is also illustrative. At independence, the US was much smaller in population. However, higher immigration and birth rate led the US to grow to be almost five times larger in population. So also has the economy grown.

Research by numerous scholars over numerous decades suggests that innovation thrives in diversity. Immigration brings enormous diversity to a country. This diversity occurs through the presence of a variety of ethnic groups and the variety of lifestyles, cuisines, perspectives, and ways of thinking that they bring. Such diversity fuels innovation. Moreover, because immigrants typically come with few resources and job opportunities, they are risk tolerant and willing to try new things for a living. Risk tolerance drives initiative, entrepreneurship, and innovation. Indeed, the proportion of startups founded by immigrants is much higher than their share of the population. Of the top 50 venture-backed companies in the US, at least half had at least one immigrant founder.

Five centuries ago, a new world opened up in North and South America and the South Pacific, most with very rich resources. In 1500 and thereafter, the hot economies and trading/commerce destinations were Mexico, Peru, and Brazil. North America seemed much less promising. Yet, 200 years after 1776, the US shot from a less attractive destination to the most powerful economy of the world. What factors drove that enormous growth? The most important factors were equal opportunity coupled with immigration. The US was founded on the powerful principle that "all men are created equal." That principle fueled numerous laws and institutions that provided near equal opportunity. That in turn provided hope for millions persecuted throughout the world and a beacon for others who lived as serfs or worse. Waves of English, Germans, Swedes, Italians, Irish, Japanese, Chinese, Koreans, Vietnamese, Indians, Mexicans, and many others created an electric mix of peoples, diversity, and opportunity to drive phenomenal economic growth. America facilitated a novel social experiment. People who immigrated to the US miraculously improved their lot relative to their peers who stayed behind, while also creating wealth in the US. The miracle emerges when the energy of immigrants meets the enormous opportunity afforded by US equality.

The experiment is still going on for all to marvel. America, keep your immigrants coming!

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