Thursday, July 10, 2008

Deportation: The Economic Boogieman (or, Why I Don’t Get My News from MSN)

This article is a shining example of why I refuse to watch “P-MSNBC” or take any MSN news article without the benefit of an entire salt shaker. To demonstrate how biased and just plain wrong this article is here is a paragraph-by-paragraph rebuttal (the italicized text is mine).

At least 12 million illegal immigrants live in the U.S. Most pick crops, wash dishes, build houses, cut lawns and do other jobs for between $6 and $15 an hour. They make up about 5% of the total U.S. work force. But …What if we threw them all out?

Lettuce and strawberries would rot in the fields. Dirty dishes would pile up in restaurants. Thousands of farmers and builders would go bust. Predator aircraft drones would prowl the Mexican border. And chunks of Los Angeles and Houston would look like ghost towns. (The assumption that increased border security will specifically target Mexicans features prominently in this article. We’re supposed to pretend that: 1) all aliens entering this country are from Mexico, 2) only Hispanics want to come to the USA, and 3) we haven’t actually captured Arabs impersonating Mexicans at border crossings. Also, completely disregard that we do have another border to our north, which if I am not mistaken provided the point of entry for several 9/11 hijackers.)

The biggest losers would be middle-class families with two working parents, living in high-immigrant states such as California, Texas, Florida or New York. Why? They would pay more for food, housing, entertainment and child care as a shortage of low-skilled workers drove up some wages, and therefore, some prices. Meantime, their own pay would remain the same. (Their pay might stay the same, but what about the need for less tax money to go to things like welfare, education, and subsidized healthcare? Perhaps with less withholdings in taxes, a middle-class family would not require two paychecks to make it in suburbia. One parent at home = free child care) What's more, the ripple effect of thousands of businesses shrinking or closing for lack of staff might put one of the parents out of a job. Not to mention the garbage collection going to pot and no one to polish the missus' nails.

The winners, for a change, would be the low-skilled unemployed, living just about anywhere -- if they were willing to move. Of the 12 million illegal immigrants, about 8 million are employed, mostly in low-skill jobs. The U.S., meantime, has about 22 million less-educated jobless adults, many of them blacks and legalized Hispanics, according to a 2008 report from the Center for Immigration Studies, a research group based in Washington, D.C. (And this is a bad thing? I thought we wanted to have a country where even the uneducated, low-skilled segment of our population could afford a living. Isn’t that the rallying cry of the amnesty crowd? After all, non-citizens theoretically cannot get a job that pays a living wage.)

Economists say if these people agreed to bone meat or install insulation, they could earn 6% to 10% more than the deported workers, as wages rose to lure new workers. That could mean $18,000 to $30,000 in pay a year. And the economy? Short term, the effect of lost manpower and spending by illegal immigrants would be "devastating" or cause "some temporary dislocation," depending on whom you ask.

Are Americans willing to do these jobs?

Ray Perryman, the president of The Perryman Group, an economic analysis firm in Waco, Texas, calculates our $14 trillion economy would suffer $652 billion in lost output -- a dramatic 4.6% slice off gross domestic product. He predicts tens of thousands of businesses would close. Robert Rector, a senior research fellow at The Heritage Foundation, a conservative think tank in Washington, predicts perhaps a 1% slip in GDP. (Please note that any other non-profit policy group is simply referred to as a “research group”. The Immigration Policy Center, later referenced in this article, is not referred to as an “amnesty think tank”.)

Why the big difference in opinion? Because people are hard to predict. Just how quickly would Americans fill the vacated jobs? And at what pay rate? Perryman points to Texas, where he says there are more than 1 million illegal workers, but only 450,000 unemployed residents. "If you do the math, it just doesn't work," he says. He doubts that many needy Virginians would move to Texas for often-grueling, low-paying jobs. (How has Perryman defined “unemployed residents”? If it is only individuals over the age of 18 who are seeking full-time employment, then his numbers are skewed. What about high school and college students who are only looking for part-time work…or not at all?)

Rector disagrees. He says it would take time for "Cousin Fred" in Texas to phone up his jobless mates in Virginia, but, "There are a lot of people who work for less than $20,000 a year." And they would move for a job.

Still, until the unemployed did jump in their Hyundais to head south, several industries in high-immigrant states would have a terrible time. Some are listed below. The figures in parentheses show the percentage of illegal workers in each industry's work force, as calculated by the Pew Hispanic Center in Washington. The figures are nationwide; in some localities, they would be far higher.

  • Home help (21%): Los Angeles would still have its sunshine, but there'd be far fewer helping hands to clean floors, cook dinner and shush the kids. Not to mention in New York, Chicago, Houston, Phoenix and Miami. Some working parents might have to quit their jobs to care for the kids or break the family piggy bank to attract a housekeeper from a neighbor. (Has anyone ever heard of hiring a teenager to do the yard work or sit with the kids? How about cleaning up your own mess? I grew up in southern California without the benefit of a housekeeper, nanny, or cabana boy. Plus, household chores are a great way to pry you or your kids away from the X-Box.)
  • Farming (13%): "Agriculture would come to a screeching halt," says Nicole Rothfleisch, executive director of the Imperial County Farm Bureau in Southern California. She says El Centro, the county seat, has the highest unemployment in the state (18%). But farmers can never find enough local help. (Obviously, it pays better to be on welfare in Imperial County). Pay is $9 an hour, and the summer temperatures can hit 110 degrees. The locals, she says, "want cushy jobs with air conditioning." (Here’s a tip: Can’t stand the heat? Leave the Imperial Valley!) Economists say many farmers would go broke as billions of dollars' worth of crops lay unpicked. Farms would merge and switch to crops that can be picked mechanically, like round lettuce or oranges used solely for juice. (Why can’t the state prison system contract out inmates to work in the fields? We have them picking up trash on the highways and working in the state parks clearing brush and rehabilitating hiking trails.)
  • Food manufacturing (14%): The big meatpacking and poultry-processing plants would slash production, increase wages (now $12 an hour in Texas) and send managers in helicopters to scour the countryside for workers. In 2006, when six plants of meatpacker Swift & Co. were raided for illegal workers, the company began offering $1,500 bonuses to Burmese refugees in Texas for each friend or relative they could recruit. (As someone who grew up around livestock, I can attest that meatpacking is messy work. I can also say that knowing a good butcher comes in handy when you’re planning a large family gathering. I would rather see higher prices in the grocery store and know that my money is going to stay in this country’s economy, not get sent to the homeland of whoever is getting paid less than minimum wage.)
  • Construction (12%): If it looks bad now, imagine an economy where homebuilding is really crushed, says Rick Montelongo, owner of a building and remodeling company in San Antonio. "It would be a huge blow," he says. Workers' wages, which make up 30% of the cost of building a home, would have to rise "substantially," he says. That would make it more expensive to build new homes, resulting in even fewer sales for an industry already experiencing a sharp downturn. (Why do we have to all have brand-new homes? Why can’t people just settle in older housing tracts that have been revamped? It surely would cut down or eliminate urban sprawl. Isn’t the whole idea of the housing tract with a postage stamp for a backyard? Besides, there is always going to be people that want a custom built home, and will pay whatever it takes to get it.)
  • Hotels and restaurants (11%): There'd be a triple whammy here. Latino staff and customers would both be lost, while the price of fresh food would be driven up by shortages. (I live in a community where more than half of the population is made up of Hispanics working in the ag industry. I don’t see them going to the local fine dining or family style restaurants. Where do they go out to eat? The taquerias and Little Caesar’s for the 2 for 1 cheese pizzas. Again, when it comes to wait staff, hire part-timers. We have no shortage of teenagers that could use some character-building.) Distraught restaurant owners would pin up job ads at colleges, when they weren't up to their elbows in dish soap. The billions of dollars spent annually by illegal immigrants would disappear, bad news for small restaurateurs and fast-food joints. (Where did this figure come from? There is minimal economic stimulation coming from the illegal immigrant population. For starters, many of them live in the same house with more than one family. This is to save money to send back to their home country. Then there’s the added bonus of illegals using fake IDs to obtain welfare benefits because their employers pay less than minimum wage.) But over time, the industry would adapt. Self-service cafés would pop up. And more restaurants would serve chicken parmesan prepared in a factory and warmed up in a microwave. Yum. (There were no restaurants before the 20th century? Aren’t their any aspiring Emerils out there that want to learn the restaurant business from the ground up?)

As for the middle-class family in California or Texas, there would be some upside. Getting Johnny into the emergency room when he broke his arm would be easier with fewer uninsured Hispanics crowding the lobby. (How about when you’re appendix has burst and you’re on the brink of death? It’s called an emergency room for a reason! It’s not the place to go if you have the sniffles.)

Some schools might even offer smaller classes. Steven Camarota, the research director at the Center for Immigration Studies, calculates that 3.3 million children, or 6% of school kids, have at least one undocumented parent. It costs about $10,000 per year to educate a child. So if all these kids left the U.S., too, it'd save $33 billion, Camarota says. "It could take a lot of pressure off the school system," he adds. Of course, some near-empty schools would have to close. (The last time I checked, people are still having babies. Our population growth hasn’t exactly come to a halt. Near-empty schools, indeed.)

What about taxes? Would the average American family get any relief? That's hotly debated. Camarota reckoned in 2004 that the federal government would save $10 billion net a year if all illegal immigrants were expelled. That's the difference between what the illegal workers pay in income and payroll tax and what they and their kids collect in federal benefits. (What payroll tax? If you don’t have a Social Security number, how does the government collect taxes from you? The whole reason that illegal aliens get hired is because they are willing to work for less and their employers don’t have to pay into things like Social Security and Medicare.) However, some economists insist that just the opposite is true. (And their insistence is based on what? Because they are the economists and they say so? Sorry, the “I’m the Mom” defense quit working on me when I was six.)

At the state level, there's more agreement. Places such as Arizona, Texas, California and Nevada, which fork out billions for education and health care, would probably be ahead -- though not by a lot overall. So, American family tax relief? Maybe a little. (It would be a whole lot more if the afore-mentioned states stuck to their budgets and didn’t find new ways to spend tax money each year.)

And then there's the neighborhood. Critics of lax immigration policies say that drug running, traffic accidents and crime would go down with the illegal immigrants gone. But The Immigration Policy Center, a Washington research group, argues that studies show that immigrants in general are less likely to commit crimes or to end up behind bars than native-born Americans. (This number does not include the “anchor babies”, the native-born children of illegal immigrant parents. Overwhelming numbers of criminals in our prison systems are either illegal immigrants or the children of illegal immigrants. These first-generation Americans are not brought up to assimilate into our society. They are raised to identify with the sub-culture of illegal immigrants.) The debate goes on.

How likely is it that this will happen? Politically, it's highly unlikely. Logistically, it would be a nightmare. (So we can track a Canadian-born cow with Mad Cow Disease or a guy who cheats the IRS a couple hundred bucks, but we can't find out who's here illegally?) Although polls show that most Americans want stronger border enforcement, deporting the illegal immigrants already here is not popular. A CBS News poll found 33% of Americans favored deportation, while 62% preferred offering legal status. In a Gallup poll, 13% favored deportation and 78% favored offering citizenship. (Polls are meaningless unless one knows how the questions were worded or how the sampling was done.) Neither John McCain nor Barack Obama leans toward deportation.

Emphasis now is on deterrence, which is proving costly. Estimates for the construction of a 15-foot-high double fence between the U.S. and Mexico range from $1 million to as much as $70 million per mile. The border is 2,000 miles long. (This is the biggest canard of them all. The Department of Homeland Security has already allocated the funds for the construction of the border fence. Why is it not yet done? Pro-amnesty groups have the enviro-wackos on their side, screaming about affecting environmentally sensitive wilderness. This is in spite of the fact that illegals camp out in these same sensitive areas, leaving trash and destroying wildlife along the way. The cost of building a secured border pales in comparison to the amount of extra money paid out in welfare benefits, inmate housing, law enforcement, judicial proceedings, and education.)

The blatant disregard for facts, impartiality, and common sense leads me to conclude that does Ms. Skeel have an agenda: insult the intelligence of her readers and portray anyone in favor of securing our borders as reactionary, xenophobic buffoons. She excels at the former and fails miserably at the latter.