Mike Kimel vs. Yves Smith
I and many others, including Yves Smith, waded into the thicket of Mike Kimel’s provocative generic and specific-reasons-for-the-generic claims in his post here earlier this week titled “Negative Effects of Immigration on the Economy.” I and others, including academic economist Barkley Rosser, commented in replies in the Comments thread to Mike’s post. Yves did so on her Naked Capitalism blog, in prefatory comment to her republication of Mike Kimel’s post.
Yves is an expert on such matters as the effects of immigration on the economy. I, suffice it to say, am not. But Angry Bear Bruce Webb and I both invoked Yves’ prefatory comment as refutation of Mike’s specific reasons for his generic claims. But Mike begs to differ, claiming that Yves’ preface is in agreement with his post.
To which I replied:
You and Yves Smith make the same point? Really? Actually, Yves was trying gently to refute your main point, which was your claim that immigration has a negative impact on job creation and your attributing this to the fact that so many immigrants aren’t white and from Europe and therefore, culturally (and intellectually) don’t sufficiently appreciate the importance of such things as time schedules and promptness.
Yves’ point was the opposite: that lower rates of job creation comes from lower rates of increase in GDP, which has nothing to do with the entrepreneurial, timekeeping and English-language skills of the current wave of immigrants and everything to do with the highly successful corporate efforts in the last nearly four decades to suppress wages–one (but only one) tactic of which has been the use of immigrants to keep wages down, thus reducing DEMAND FOR GOODS AND SERVICES. The effect on job creation is, contrary to your claim, not direct and is not the result of what you say it is, and is the indirect result of deliberate corporate goals.
Funny, y’know, but Germany, Holland, Scandinavia and Canada all have had very large non-white immigration in recent decades. All have strong laws supporting worker power, as well as corporate cultures that favor long-term investment and rational executive-suite compensation, and … voila! They have economies that work well.
Obviously, Yves can speak for herself on this if she cares to. But it’s clear from the comments in the lengthy Comments thread to Mike’s post that I’m far from the only one who takes strong issue with what is at the heart of Mike’s premise.
This is by no stretch the type of thing I normally post about, but it gets to the heart of what others do, here and elsewhere, and certainly concerns issues at the forefront of this election cycle. And therefore it’s worth my walking out onto this limb here.
The Dutch economy is extremely reliant on vagaries of their particular state-to-state tax agreements for some portion of their fiscal “success.” The “Dutch Sandwich” isn’t famous for nothing.
Some portion of Germany’s “immigration” was in-place immigration of long term guest workers, and family reunification when they started changing their laws on such things (2000s?).
The postwar Northern European penchant for guest workers is nothing new, but I’m not sure how it stands currently in Holland / Scandinavia … Germany’s law changes mostly did away with that second class of worker.
That article buries the lede. 8 estimates. Worst case $296 billion. Which one gets into the URL without qualification? And into the headline for that matter?
Mass immigration costs government $296 billion a year, depresses wages
Blank links are not arguments. Headlines are not arguments. And this is especially true when citing sources like the Washington Times. Or as many call it “The Moonie Times”
I am not saying you have to contextualize everything. On the other hand blind links with deceptive claims embedded need SOME qualification.
The study documents that local governments bear a fiscal burden for immigrants (mostly through school costs), and shows that they may also put downward pressure on wages at the very bottom of the wage distribution. But there is no evidence of any slowing of job creation or of “taking away of jobs” from locals, which is the point of the original argument by Mike Kimel until he started trying to turn it into something else like growth rate of real per capita income, which do not correlate all that well.
I would expect people to read the article and the paper on which is it based:
But perhaps that is expecting too much.
Warren you expect people to follow your blind link, reconstruct your motive for posting said link, double check your reasoning for that reconstructed argument by following the source, all before they respond to your implied claim that posting the link was in fact an argument in and of itself.
Well not withstanding that I did all that, that is expecting too much. Compared to say actually supplying the original source and making SOME DAMN EXPLICIT ARGUMENT based on it.
Pro tip. You don’t get to just assign reading and research projects to other people. Make your own case or STFU.
Do you like this better:
Dunno. But since this from that totally undercuts the Wash Times thingie maybe so:
Not to mention that all of these arguments seem to discount actual productivity contributions to zero.
My name is Juan. I get hired to help pour cement and asphalt for highway projects. I get paid prevailing wages and pay taxes on them, but as a renter do not pay (directly) the property tax used to educate my three school age children. In fact after you combine all the education and health services I consume, plus unemployment and food stamps for the rainy season when major highway construction pauses, my total tax burden barely matches my service cost. If that. So I am dead weight.
Oh except that you have my portion of that highway to transport your goods on. And any multipliers stemming from my buying ropas and zapatos for the ninos. And maybe some comidas. Seems to Juan that your math is not quite complete here.
This is hilarious. Five, six years ago Mike was this blog’s most celebrated contributor…now he’s a racist Trumpkin.
So much for data driven arguments.
Yves vs, Mike? I’ll put $100 on Mike.
Mike’s work on President-metrics and their analysis in terms of all kinds of possible time lags was a big part of what put AB on the map. On the other hand critics of his thesis here are just asking that he apply that same time lag analysis and rigor to his immigration argument. Personally I am not seeing much that reminds me of the book he co-authored, arguments for which were fleshed out right here over a period of many months:
Yeah, Mike’s Presi-metrics was terrific. He was the first to recognize what the statistics actually showed, wasn’t he? I know that others picked up on his work and wrote about it, some without attribution, I think, but the point really did become widely enough known that (I believe) Obama used it at one point during the 2012 campaign.
I can’t really reconcile that Mike Kimel with the one who’s been writing the recent posts here.
Actually, I had no motive but to bring real data into the conversation.
A bare link is not “data”. Particularly when there is a deceptive datum embedded in the URL.
Now if you had STARTED with this link then you MIGHT have a plausible case: https://www.nap.edu/catalog/23550/the-economic-and-fiscal-consequences-of-immigration
But instead you linked to a notorious propaganda outlet for the Right. Without comment and without context. And without actually isolating any datum or data set. Sorry Charley, not born yesterday.
I think Kimel makes a mistake focusing on the cultural values of immigrants. We do have a problem with illegal immigrants lowering wages at the bottom end of the scale. Immigrants are often willing to put up with low wages and conditions that even poor Americans will not, and those immigrants make perfect strike breakers since they cannot unionize lest they be summarily deported. In the past, legal immigrants were among the labor organizers, but illegal immigrants don’t have that option.
Immigrants are the self selected go getters. You can pick the laziest, least competent nation in the world. Judge it by invidious stereotypes, JD Powers surveys, local newspaper editorials, economic statistics or whatever. The people from there who come to the US are the ones who left. e.g. India is not noted for the extreme efficiency of its train system, but India has provided the US with a whole cadre of technologists often well educated at places like IIT (not ITT) if not at US schools.
The US, by first world standards, has a crummy safety net. I think we need a better one, but recognize that having a lousy safety net encourages assimilation. The US is probably number one at creating crappy jobs that even an immigrant unfamiliar with the language and culture can do and be poorly paid for doing so. An immigrant can only find so much shelter in the immigrant community before being forced out by the exigencies of making a living.
I hope you realize that your second link destroys MK’s claim that immigrants are damaging job growth.
In my previous post I listed points in favor or the anti-immingrant position that come from the report as listed elsewhere by George Borjas, who is on the board that oversaw and approved the report, Borjas of Harvard being probably the most prominent academic stressing negative aspects of immigration. As I already noted, there are negative fiscal implications and possibly on wages of native workers at the bottom of the wage distribtuion. There is no negative impact on job creation. MK got in trouble with me for making that claim.
Those negative fiscal implications are for local governments. For the federal government the fiscal implications are positive in the long run.
And Barkley I would ask whether even the local government sees net negatives once you figure in small business creation among first generation immigrants and home ownership among the second.
They used to have a phrase for this, it will come to me in a second, oh yeah!! “The American Dream”.
Andrew Carnegie was a poor immigrant after all. And Steve Jobs was adopted.
“I hope you realize that your second link destroys MK’s claim that immigrants are damaging job growth.”
Hi, I was reading on Naked Capitalism and saw this post and its comments.
It seems to me that too many pick a small part of the economic and social picture, and then staked everything on what that small piece supports.
I do believe that the immigrants we get are a boost to both our national economy and economy, especially for the top 20%. I do not think that telling everyone on the bottom half including union members, minimum wage earners, and the homeless that would be a good. We already have an effective unemployment rate of 10%, real wages are declining, and where there is work, housing costs are becoming increasingly unaffordable.
So I guess it comes to what you think are the most important, perhaps the most moral issues to you. Improving, or at least making bearable, the lives of all the people already here and perhaps preventing civil unrest, even war. Or Improving the lives of the top 20% and new immigrants, and guaranteeing civil unrest.
I am not being hyperbolic. As for the “American Dream” I am going to steal from Mahatma Gandhi, and say that it is a wonderful idea.
This is one year old.
But it is not old enough to escape JBird’s Righteous Wrath!
Yeah, I know, but it was late at night, or real early in the morning, and my berserk button was pushed, so off I went.
I enjoy righteous wrath as much as anyone else. Based on other posts I have written (some since), and some rough swaggerizing on numbers, I would add a comment. It isn’t that the top 20% gain from immigration. I’d venture to guess the following:
a. the top 20% in the economy gain from the 40th percentile to 80th percentile immigrants. In other words, they gain from those who show up and have the ability to labor that is reliable, and undercuts the domestic working class on cost.
b. the domestic working class gains from the arrival of the top 20% of immigrants. Those are immigrants that compete for the higher paid, white collar jobs and do it by undercutting the domestic higher paid white collar workers on cost.
c. The top fraction of 1% gains from the 40th percentile to the 100th percentile of immigrants
d. If real GDP per capita is expanding at a 4.5% annual rate, then the 40th to 100th percent of immigrants can be a net positive to the economy overall
e. We have had 16 straight years of lower growth than we need to absorb the 40th to 100th percent of immigrants in a way that benefits the economy overall.
f. The bottom 40th percentile of immigrants are generally a drain on the economy, regardless of how fast the economy grows. They do not end up contributing more to the economy than they cost the taxpayer in benefits. The domestic beneficiaries, when it comes to their arrival, are the (primarily religious) agencies that are dedicated to helping immigrants arrive and service providers that specialize in low cost housing, etc.
g. It is impolite to mention the existence of the bottom 40th percentile of immigrants
h. The children of the bottom 10% of immigrants can also fail to be net contributors to the economy, either due to criminality or other factors
i. It is beyond impolite to mention the existence of the bottom 10th percentile of immigrants