Clinton’s Immigration Policy Undermines Her Economic Narrative

Immigrants line up for delayed deport and work permits.
Washington D.C.

In her Tuesday economic address, Hillary Clinton promoted an economic agenda that is directly undercut by her radical and expansive immigration proposals.

“My mission as President is to help create more good-paying jobs so we can get incomes rising for hardworking families across America,” Clinton said. “It’s a pretty simple formula: higher wages lead to more demand, which leads to more jobs with higher wages. And I’ve laid out a detailed agenda to jumpstart this virtuous cycle.”

However, Clinton’s claim that she wants to help working families is incompatible with her proposals to flood the U.S. labor market and give big businesses a large supply of low-wage foreign workers.

Indeed, the “simple formula” for higher wages that Clinton touts in her speech contradicts Clinton’s immigration proposals.

As Manhattan Institute scholar Heather MacDonald has explained, “the law of supply and demand applies to labor.”

Immigration can affect the wages of both high-skilled and low-skilled workers.

“Bringing in more skilled immigrants will decrease salaries at the higher end,” MacDonald writes, and unskilled immigration “not only depresses wages for less-educated Americans, but imposes significant social costs on taxpayers as well (through trying to close the achievement gap between the children of uneducated Hispanic immigrants, on the one hand, and whites and Asians, on the other; through subsidized health care; and through police and prison expenditures).”

Harvard Professor George Borjas has explained:

[E]conomic theory predicts that increasing the supply of labor [through immigration]… will reduce earnings for natives in competition with immigrants… Statistical analysis shows that when immigration increases the supply of workers in a skill category, the earnings of native-born workers in that same category fall. The negative effect will occur regardless of whether the immigrant workers are legal or illegal, temporary or permanent. Any sizable increase in the number of immigrants will inevitably lower wages for some American workers. Conversely, reducing the supply of labor by strict immigration enforcement and reduced legal immigration would increase the earnings of native workers.

In particular, “the negative effect on native-born black and Hispanic workers is significantly larger than on whites because a much larger share of minorities are in direct competition with immigrants,” Borjas writes.

Borjas’ analysis has shown that “a 10% immigrant-induced increase in the supply of a particular skill group is associated with a reduction in the black wage of 2.5%, a reduction in the black employment rate of 5.9 percentage points, and an increase in the black institutionalization rate of 1.3%.”

“Competition from immigration accounts for approximately 40 percent of the 18-percentage point decline in black employment in recent years,” U.S. Civil Rights Commissioner Peter Kirsanow has documented. “That’s nearly a million jobs lost by blacks to immigrants.”

Borjas has highlighted the writings of economist Paul Samuelson, who in 1964, observed that “after World War I, laws were passed severely limiting immigration. Only a trickle of immigrants has been admitted since then… By keeping labor supply down, immigration policy tends to keep wages high. Let us underline this basic principle: Limitation of the supply of any grade of labor relative to all other productive factors can be expected to raise its wage rate; an increase in supply will, other things being equal, tend to 
depress wage rates.”

Indeed, the historic flow of immigration into the United States is primarily the product of a Ted Kennedy-supported immigration law enacted in 1965, which lifted immigration caps that had been put into place during the Coolidge administration, and opened immigration to predominantly poor and developing countries.

Every year the U.S. admits one million plus foreign nationals on green cards, one million guest workers, dependents, and refugees, and half a million foreign students. In 1970, fewer than one in 21 Americans were foreign-born. Today, as a result of the federal government’s four-decade-long green card gusher, nearly one in seven U.S. residents was born in a foreign country. And in seven years time, according to Census Bureau reports, the foreign-born share of the U.S. population will reach an all-time high.

Recent reports have documented the sustained compression of the middle class during the forty-year green card wave, as well as the discovery that all net job creation among working-age people went to foreign workers from 2000-2014. This data comes on top of evidence documenting the overcrowding of schools where a growing number of students qualify for free meals and require language instruction.

The immigration reductions enacted after World War I were backed by both Republicans and labor bosses, who thought immigration curbs would enhance assimilation and improve wages and living conditions.

As then-President Coolidge explained while promoting his immigration curbs:

We want to keep wages and living conditions good for everyone who is now here or who may come here… As a Nation, our first duty must be to those who are already our inhabitants, whether native or immigrants. To them we owe an especial and a weighty obligation.

American Federation of Labor (AFL) founder and president Samuel Gompers similarly said, “Those who favor unrestricted immigration care nothing for the people.”

It was not until recent years that Democratic leaders abandoned their position that federal immigration policies should prioritize the jobs and wages of American workers. For instance, in 2007, Senator Bernie Sanders opposed George W. Bush’s expansive immigration agenda because it would “bring low-wage workers into this country in order to depress the wages of American workers, which are already in decline.”

Sanders wrote:

With poverty increasing and the middle-class shrinking, we must not force American workers into even more economic distress. The CEOs who want this [immigration] bill aren’t even embarrassed by their hypocrisy. One day they shut down plants with high-skilled, well-paid American workers, and move to China where they pay desperate people 50 cents an hour. The next day, they have the nerve to come before the U.S Congress and tell us that they can’t find skilled workers to do the jobs that they need. Give me a break.

Yet far from curbing immigration, Hillary Clinton has called for a radical increase in immigration.

Clinton has pledged to expand President Obama’s unconstitutional executive amnesty, freeze deportations, close detention centers, give Obamacare to illegal aliens, and expand refugee resettlement.

In her Tuesday speech, Clinton reiterated her call for amnesty and suggested that enforcing U.S. immigration law “is really bad economics.”

“Kicking out 11 million immigrants would cost hundreds of billions of dollars and it would shrink our economy significantly,” Clinton said. “Some economists actually argue that just this policy alone would send us into a Trump recession. So instead of causing large-scale misery and shrinking our economy, we should pass sensible immigration reform with a path to citizenship.”

However, full amnesty for the illegal immigrant population will cost U.S. taxpayers $6.3 trillion, according to a report from the Heritage Foundation.

Similarly, Clinton’s plan to resettle 65,000 Syrian migrants would cost U.S. taxpayers over $42 billion over the course of the migrants’ lifetime. Trump recently called on Clinton “to replace her support for increased refugee admissions… with a new job program for our inner cities.”

“We have to use the money to take care of our poorest Americans and work with them, so they can come out of this horrible situation that they’re in,” Trump said.

In her Tuesday speech, Clinton insisted that she believes “in the ingenuity and productivity of America workers.” It is unclear, however, why she would then promote an immigration agenda that would replace American workers with foreign laborers.