Sunday, May 2, 2010

Illegal Immigration Incentives

An anonymous commenter got me thinking about further analyzing the illegal immigration situation in term of the incentives of the different players. First the comment was in response to a complaint I had about the health care bill.

>"For example, on health care, wouldn't it have been good enough to just subsidize the lower income brackets to purchase health care and guarantee portability so that pre-existing conditions can be covered? " (from my post) Of course it would, but when was the last time you saw someone elected on such a platform? Either you are for radical reform, or you are against any reform. Pick your team. The blue team loves big government, The red team loves big business. Who loves the little guy?
That's exactly the point of the Tea Party, to bring the pain of the average American taxpaying, crime-wave suffering schlub to the attention of the politicians and put them on notice that they can ignore us no more. With respect to immigration, the incentives to the key players are working against reform. A quick look (by the way, I will oversimplify by assuming that most illegal immigrants are from Latin America who cross into the U.S. southern border, that is often the case, but not the whole problem, more on that some other day.)

Employers of Illegals.
This one is obvious. These guys get workers, often below minimum wage, and certainly for wages that are unattractive to native Americans.

The Hispanic Community.
You would think that since the illegals often compete for jobs held by legal residents in this community, they wouldn't be rallying, but they are? This is an issue of identity politics. Further, I think their is a belief that if the large numbers of current violators are granted amnesty, it will swell their numbers and make them more important politically. Certainly, that is the belief of some Latino politicians and "community organizers." As a result, this community is not in favor of closing the border. They are aware that the deportation of 11 million people isn't happening any time soon.

Democrat Party.
There is a parallel argument that Democrats benefit politically from this issue, and that doing nothing helps them. First, it gives them an excuse to play the race card. Second, they can woo the Hispanic vote without actually doing anything about the problem, blaming Republicans for the lack of progress. However, some in the Latino community are beginning to notice, if you read some "man in the street" interviews from yesterday's protests. Democrats prefer to demagogue rather than offer solutions, because they know that if they keep their amnesty promise, they will really energize the opposition. This is why Obama said earlier that nothing was happening without Republican cover. Enter Lindsey Graham.

Republican Party.
The incentive for them is not to lose votes. They are playing an entirely defensive game, remembering what they perceive as Pete Wilson's disastrous efforts in the 1990's to deny illegal immigrants state benefits that was widely viewed as racist and turned the Latino vote in California decidedly Democrat ever since. (You can argue if this should have been the outcome, but those are the facts.) Even though their base wants them to do something, they dither because of fear of losing votes nationwid and possibly the harm to the businesses employing illegals. (I have no hard evidence on the latter.)

OK, I admit to being stumped on this one at first. The unions, if they were really looking after the interests of their members, should be the one's making the loudest demands to halt the flow of illegal immigrants, because they put downward pressure on wages. However, unions have long since abandoned any pretense at actually representing their members true long term interests. Second, I don't see illegal immigrants working in unionized industries. Most union members work for a branch of the government, where citizenship is usually a prerequisite and the other unionized private sectors (transportation, utilities, telecommunications, groceries, construction) don't have a big illegal presence. More importantly, I think the union leadership has a flat out socialist agenda. Swelling the voter rolls with low wage, relatively uneducated workers advances their agenda of moving forward with a left wing/socialist agenda. (This applies to the Democrat Party as well.)

Let's face facts, some of the benefits of low wages paid to illegals are passed along to consumers in the form of lower prices for goods and services. Restaurant prices, landscaping costs, minor construction and repairs on your house all come to mind. I don't think the general public is totally focused on this fact, but I think it makes people feel a little guilty and helps people buy into the notion a crack down is somehow unfair, because they know they are contributors in some sense. (Yes, this is a broad generalization.)

But the big losers are the Rule of Law and the portion of the population that lives along the border and suffers from the attendant lawlessness. This is why it is Arizona is the state dealing with the problem first. From a benefit/cost aspect, they are probably the biggest losers as the border fence in California drove the immigrants eastward, and Arizona's relatively smaller population means that they don't derive much benefit. Further, the crime wave from the concomitant increase in drug smuggling through Arizona has motivated the public to demand some action. The damage to the rule of law should not be underestimated. Society is much more fragile than we imagine, depending on a broad set of shared agreements about the nature of justice and the relationship between the governed and the government. The alienation Peggy Noonan wrote of yesterday is only exacerbated by the conscious undermining of the rule of law by the administrations of both parties. For this reason, I agree with her that an increased effort to enforce the border is absolutely required. The government must show good faith to the people in restoring a sense of justice and the rule of law. But it will not be enough and as one can see from the incentives of key players, a coalition that brokers a deal will be needed to put this issue to rest completely.

And let's not forget the real casualties in the assault on the rule of law:

Rob Krentz was a lifelong rancher in Southeastern Arizona, 12 miles north of the U.S./Mexico border and 25 miles northeast of the city of Douglas. He was the father of three children. The ranch has been in his family for three generations, more than 100 years – since 1907, and sits on about 35,000 acres with 1,000 head of cattle. Running a ranch is hard work and with the influx of illegal aliens increasing, Rob was at ground zero of the stampede that is destroying the fragile desert landscape. (H/T Bonfire's Blog.)


  1. It's a transfer of wealth from taxpayers to businesses.

    They get cheap labor and we get to pay for the education, law enforcement, and emergency health care costs.

    Yes, consumers benefit marginally, but I'd rather pay an extra nickel per head of lettuce and mow my own lawn than pick up the tab for all the social services.

    Remember when teenagers used to mow lawns and work in fast food restaurants? Was that so bad?

  2. WC,
    I appreciate your point of view. I have seen conflicting studies on the issue of illegal immigrants and how much tax burden they shoulder compared to the services they consume. Certainly, it also argues for a smaller welfare state, because human beings naturally resent free riders. It's hard too find studies that aren't ideologically tainted on this question. Thanks for commenting.

    As for the teenagers, I still see them working. My oldest, Waynok, is on his fifth job, for example.