Bioenergeia

The Wall Street Journal op-ed titled “Mass Deportations Sabotage the Economy” argues that labor force growth fuels a positive feedback loop of production and consumption, and to disrupt this would harm the economy and the country. This argument is narrowly focused on questions of aggregate growth and assumes that national health follows directly from it and misses negative externalities of immigration. There are distributional effects of growth via immigration, risks of technological displacement, and civic consequences that demonstrate that economic growth at any cost is not a sufficient condition for national health.

Making the inference that aggregate GDP growth is straightforwardly an increase in wealth that should interest everyone is seriously debated among economists. George Borjas, a professor of Economics and Social policy at Harvard University, coined the immigration surplus framework which analyzes who benefits from this increase in total output.¹ He argues that the increase in labor supply puts downward pressure on wages of workers and increases returns to capital, meaning despite the increase to total output, income is redistributed from substitute workers to firm owners. The estimated immigration surplus is around 0.1% – 0.3% of GDP, while the wage losses for native workers in jobs heavily occupied by immigrants can be several percentage points.² This is directly counter to the idea that, in the context of immigration labor economics, what is good for the goose is good for the gander. What instead is seen is a modest increase to GDP from the surplus, which mainly accrues to the firm owners and immigrants themselves, and the losses of native workers are significant and concentrated.

The op-eds pro mass migration argument focuses on the labor market in its current state but misses future concerns about AI and robotics. While economists like David Autor take a more optimistic tone regarding AI rebuilding the middle class through the democratization of expertise, he acknowledges the serious risk of technological displacement for routine tasks.³ In a future workforce with many automated tasks, having a smaller workforce may be preferable. Continuing to grow labor supply may benefit some in the short term, but in the long run could exacerbate underemployment and increase the fiscal burdens of the state to compensate. Despite the firm owners enjoying the benefits of lowering labor costs in the present, matters of public policy must be more comprehensive and forward looking in terms of their consideration.

Some of these broader concerns that policy makers should consider are the reasons for decline in native fertility. The op-ed presents immigration as a compensatory mechanism for fewer births but ignores possible root causes. While falling birth rates are common among developed countries, they can be signals of housing unaffordability, public health concerns, or deeper fragmentation of people from their communities through the decline of social capital and reciprocity. The erosion of social capital in America has been written about extensively by Robert Putnam, a Harvard sociologist, and he identifies a complex network of causes that have contributed. One of the causes of short-run reductions in social trust mentioned in his 2007 paper “E Pluribus Unum” is rapid demographic changes at the community level, a problem exacerbated by our current immigration posture. He found not only reductions in “out-group” trust but also “in-group” trust via a “hunker down” effect where people in diverse communities withdraw from collective life and social reciprocity.⁴ His findings did show integration and stabilization over the longer term, but if social capital is not considered alongside econometrics there is a risk of reducing national health and vitality to dollars and cents.

The op-ed concludes by asking: “What is the ROI on our investment in ICE?”, which is emblematic of the weaknesses of the article’s thesis. It frames the issue of immigration as purely an economic one, assuming the country is comparable to a corporation where investment in ICE is an operating cost and aggregate GDP growth is the net profit on a balance sheet. Public policy pursuant to national success and vitality cannot be understood through the lens of a corporation because people are not interchangeable economic units, and our goals are not measured quarterly. They span generations.

¹ George J. Borjas, “The Economic Benefits from Immigration,” Journal of Economic Perspectives 9, no. 2 (1995): 3–22.

² George J. Borjas, Immigration Economics (Cambridge, MA: Harvard University Press, 2014), 158.

³ David Autor, “Applying AI to Rebuild Middle Class Jobs,” NBER Working Paper Series, no. 32140 (February 2024).

⁴ Robert D. Putnam, “E Pluribus Unum: Diversity and Community in the Twenty-first Century: The 2006 Johan Skytte Prize Lecture,” Scandinavian Political Studies 30, no. 2 (June 2007): 137–174.