North of the Border


March 27, 2006 

By: Paul Krugman 

"Give me your tired, your poor, your huddled masses yearning to
breathe free," wrote Emma Lazarus, in a poem that still puts a lump in
my throat. I'm proud of America's immigrant history, and grateful that
the door was open when my grandparents fled Russia.

In other words, I'm instinctively, emotionally pro-immigration. But
a review of serious, nonpartisan research reveals some uncomfortable
facts about the economics of modern immigration, and immigration from
Mexico in particular. If people like me are going to respond
effectively to anti-immigrant demagogues, we have to acknowledge those

First, the net benefits to the U.S. economy from immigration, aside
from the large gains to the immigrants themselves, are small. Realistic
estimates suggest that immigration since 1980 has raised the total
income of native-born Americans by no more than a fraction of 1

Second, while immigration may have raised overall income slightly,
many of the worst-off native-born Americans are hurt by immigration —
especially immigration from Mexico. Because Mexican immigrants have
much less education than the average U.S. worker, they increase the
supply of less-skilled labor, driving down the wages of the worst-paid
Americans. The most authoritative recent study of this effect, by
George Borjas and Lawrence Katz of Harvard, estimates that U.S. high
school dropouts would earn as much as 8 percent more if it weren't for
Mexican immigration.

That's why it's intellectually dishonest to say, as President Bush
does, that immigrants do "jobs that Americans will not do." The
willingness of Americans to do a job depends on how much that job pays
— and the reason some jobs pay too little to attract native-born
Americans is competition from poorly paid immigrants.

Finally, modern America is a welfare state, even if our social
safety net has more holes in it than it should — and low-skill
immigrants threaten to unravel that safety net.

Basic decency requires that we provide immigrants, once they're
here, with essential health care, education for their children, and
more. As the Swiss writer Max Frisch wrote about his own country's
experience with immigration, "We wanted a labor force, but human beings
came." Unfortunately, low-skill immigrants don't pay enough taxes to
cover the cost of the benefits they receive.

Worse yet, immigration penalizes governments that act humanely.
Immigrants are a much more serious fiscal problem in California than in
Texas, which treats the poor and unlucky harshly, regardless of where
they were born.

We shouldn't exaggerate these problems. Mexican immigration, says
the Borjas-Katz study, has played only a "modest role" in growing U.S.
inequality. And the political threat that low-skill immigration poses
to the welfare state is more serious than the fiscal threat: the
disastrous Medicare drug bill alone does far more to undermine the
finances of our social insurance system than the whole burden of
dealing with illegal immigrants.

But modest problems are still real problems, and immigration is
becoming a major political issue. What are we going to do about it?

Realistically, we'll need to reduce the inflow of low-skill
immigrants. Mainly that means better controls on illegal immigration.
But the harsh anti-immigration legislation passed by the House, which
has led to huge protests — legislation that would, among other things,
make it a criminal act to provide an illegal immigrant with medical
care — is simply immoral.

Meanwhile, Mr. Bush's plan for a "guest worker" program is clearly
designed by and for corporate interests, who'd love to have a low-wage
work force that couldn't vote. Not only is it deeply un-American; it
does nothing to reduce the adverse effect of immigration on wages. And
because guest workers would face the prospect of deportation after a
few years, they would have no incentive to become integrated into our

What about a guest-worker program that includes a clearer route to
citizenship? I'd still be careful. Whatever the bill's intentions, it
could all too easily end up having the same effect as the Bush plan in
practice — that is, it could create a permanent underclass of
disenfranchised workers.

We need to do something about immigration, and soon. But I'd rather
see Congress fail to agree on anything this year than have it rush into
ill-considered legislation that betrays our moral and democratic

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