“You don’t build a nine foot fence along the border between two friendly nations…Rather than put up a fence, why don’t we work out our mutual problems?…Document the undocumented and let them stay.”
—Ronald Reagan campaign speech, 1980
The violent, inhumane and impoverished conditions that refugees now experience on the border of the world’s most prosperous country are inexcusable and unnecessary. The immigration policies enacted by this administration are responsible for this new “emergency.”
But setting aside the inhumanity of current policies—a setting aside which we should not do—the basic economics of the current immigration policy are also deeply flawed.
Look at the numbers:
The U.S. Department of State expects 368,000 asylum and refugee applicants to the U.S. in the next year. Recently, the Trump administration said it wanted to accept a record low of 18,000 of these 368,000. Barack Obama set what many considered an absurdly—and inhumanely—low level of 85,000. (During Reagan’s 1980s, 8.5 million refugees were accepted into the country.)
The recent rise in immigrants at our border was a simple and predictable result of basic economic laws. Economics is often defined as the “study of the allocation of scarce resources.” Entry visas into the U.S. are obviously increasingly “scarce resources.”
When Trump, while still on the campaign trail, promised to make these entry visas even more scarce, a wide population of Central and South American people who had been quietly considering such a migration recognized time was of the essence. When he actually got elected, they knew they needed to act soon.
In other words, from an economist’s perspective, Trump’s own immigration policies created the so-called “emergency” at the border. Or if they did not create it, they put the migration on steroids. (Gangs, governmental corruption and economic oppression are what creates the original impetus for migration). The tens of thousands who had been considering a change thought, “Better flee to the U.S. now, before their policies change.”
From an economist’s point of view, it is quite predictable what the eventual result of admitting a record low number of “official” refugees will be. The most basic law of economics is the law of supply and demand—proven itself again and again over hundreds of years and in every country of the world.
The demand for asylum and refugee status is 368,000, but the supply has been bureaucratically set artificially low at 18,000. No economist anywhere would dare come up with a “reason” or justification for the 18,000 number. The number is not based on need or demand or U.S. abilities to integrate such asylum seekers. Rather, the number was apparently set solely because of racial and cultural prejudices and reveals outright ignorance of basic economic principles.
If the demand for legal asylum is 368,000 and the supply is 18,000, economic law predicts a tsunami-like increase in illegal, undocumented, worst-case scenario entries into the U.S. Trump’s policies will bring about the exact opposite of what Trump is trying to prevent.
The supply: 18,000. The demand: 368,000.
History shows that the 350,000 refugees and asylum seekers who Trump is planning to turn away are not just going away. When you put up a wall, be it physical or administrative, it has been proven over millenniums (from the Chinese Great Wall to the Roman Hadrian’s Wall across northern England to the Berlin Wall) those who want to migrate or infiltrate will go under, over, around and through to get to where they want to go. That’s human nature.
Even though solid evidence exists that refugees and asylum seekers are among the most law-abiding citizens, we should not be surprised if in the months ahead we hear isolated incidents of “illegals” committing horrific crimes. That’s because Trump’s 18,000 number will make the worst of the illegals most bold. We will also hear of more and more bold, yet tragically (deadly) failed attempts at entering.
What these 368,000 refugees are seeking is simply a decent life with the rule of law and a tradition of fairness and equal opportunity. They want to work and raise their families in an environment without constant threat of terror or lawlessness. Can’t blame them. As Reagan suggested, “let’s document the undocumented.”
From an economists point of view, 368,000 refugees looks like a life-saving bonanza for local small businesses, rural communities in need of an influx of population, farmers and orchard keepers needing help in the fields, and small towns needing new entrepreneurs. Those old buildings boarded up across the midlands will find new enthusiasm here.
Basic economic laws, proven true since Adam Smith outlined those laws in his classic 1776 book, “The Wealth of Nations,” make the 18,000 figure laughable. From an economic point of view, one can predict that Trump and his sycophants will be proven quickly and quite possibly tragically wrong in setting their low number.
The current immigration policy ignores history, ignores the realities of the deep attraction of our economic infrastructure (even for “undocumented” workers), ignores the rules of prosperity, ignores the fundamentals of good foreign policy, and most important, ignores the basic, instinctual empathy that humans hold for other humans in need. (The public backlash against these racist immigration policies continues to grow.)
Supply and demand. It’s not rocket science. Let’s accept the best of the best—the top 184,000, or even the top 250,000 of the 368,000 of those who want to live and work here. Economic history shows that our communal lives would be so much better for it.
Fear and racism have their costs. The 18,000 number will extract a cost we cannot afford to pay. Increase that 18,000 number by 15 times, which will be 270,000. We all will live better, more peaceably, more prosperously—guaranteed. Two hundred and fifty years of economic evidence of the law of supply and demand, not to mention our own 400 years of evidence of the boom of immigration, makes the necessary choices for our future quite obvious.
Reagan famously said, “Government is not the solution to our problem. Government is the problem.”
Paradoxically, immigrants are not the problem for our economy. They are the solution.
Bear Gebhardt is the author of non-fiction books on a variety of topics that range from smoking cessation to restructuring the Electoral College. His articles have appeared in some of the most prestigious publications in the U.S. Learn more about him…