TS Arthur Foulkes

Arthur E. Foulkes

Imagine you live on a beautiful Pacific island with a few hundred other people.

All of the islanders who are able to work have found something useful to do for the benefit of other islanders and themselves. For instance, some build huts, some repair huts, some hunt, some fish, some collect fruit.

Trade holds the people of the island together; in fact, apart from family and friendship ties, the only reason most islanders have for knowing and dealing with each other is to exchange with each other. But because exchange is mutually beneficial, this purely pragmatic reason for cooperating builds a nice, peaceful and steadily wealthier society.

Then one morning, a ship appears on the horizon, and within a few minutes it is resting on your island’s shore. On board are dozens of half-starved refugees from a distant island where a volcano eruption has made life miserable. These people have arrived at your island seeking a better life.

Suddenly, your island is home to dozens of foreigners. They speak a different language. They have different customs.

“This is an invasion,” some say. “These alien people will make us all worse off!”

Sure enough, some of the new arrivals, because they have been living in difficult conditions back home, are happy to exchange the fruit of their labor for less than many natives. For instance, instead of seeking two coconuts in exchange for a day’s work on a hut, these new arrivals will accept a single coconut.

Soon the island leadership, always sensitive to highly emotional issues, decides to build a fence around the island to control the arrival of these people. The leadership also passes minimum wage laws so natives cannot be underbid in the market by these aliens.

Furthermore, the island leadership passes another law declaring many of these new arrivals “illegal,” meaning they cannot lawfully engage in exchange with natives.

As a result, your island is soon home to a group of people who have to live in the shadows. They still need to eat, so some rely, despite coming from an island with a good work ethic, on taxpayer funded support. Others go to work illegally at very low pay and in poor conditions and find themselves at the mercy of the few native islanders willing to illegally hire them.

Miles away beyond the horizon, another island, much like yours, has had the same recent influx of aliens from the same volcano-devastated island. But on this island, no fence was built and no new laws were passed.

On the second island, more hands mean more useful work can be done. And greater productivity means that the real prices for goods and services – even for workers outcompeted by the new arrivals – are lower. And rather than empowering the island’s leadership with the ability to determine who is “legal” and “illegal,” the second island’s leadership stayed out of the personal comings and goings of a free people.

Over time, the new arrivals on the second island have children who barely speak the language of their parents’ former island. And the children of these children don’t speak the old island’s language at all.

The second island also grew culturally richer as well. Immigrant entrepreneurs started new businesses. Families intermarried and new friendships were made.

Unfortunately, only one of these “islands” exists today – the first. But until the last quarter of the 1800s, the second island resembled America, a place where new arrivals were free of bureaucratic interference. But this does not mean they were always welcome.

Many Americans said the Germans arriving in the 1860s and 1870s only wanted to speak German, listen to German music and drink beer. (Indeed, Prohibition received some of its support from latter-day anti-German sentiment.) Later in the 19th Century, Poles and Italians faced the same resentments, as did Eastern European Jews.

There are around 12 million “illegal” immigrants living in the United States today. They sometimes paid dearly to avoid U.S. border patrols. Some are forced by the Coast Guard to return to such places as Cuba after making life-endangering voyages. Others die while being illegally smuggled into the U.S.

The International Monetary Fund has found that the free movement of people, where it exists, has increased overall productivity and wealth. While some segments of the society have a smaller relative slice of the whole pie, that slice is still larger than before because of increased productivity and lower real prices for goods and services.

In a June 2006 open letter to Congress and the president, hundreds of American economists stated that “immigration has been a net gain for American citizens, though a modest one in proportion to the size of our $13 trillion dollar economy.”

The economists went on to note, “Immigrants do not take American jobs. The American economy can create as many jobs as there are workers willing to work so long as labor markets remain free, flexible and open to all workers on an equal basis.”

Some will argue that immigration must be controlled because immigrants are a strain on public resources, such as taxpayer-funded schools and welfare. But these problems would not exist if these programs did not exist. As economist Milton Friedman noted, “You can’t have free immigration and a welfare state.” So abolish the welfare state – not the free movements of human beings.

For those who worry immigrants will erode what it means to be “American,” they might consider that immigrants have much lower crime rates than natives. Indeed, the immigrant crime rate is especially lower than American rates when immigrant education and income levels are taken into account.

Those who want to build fences around the United States suffer from a belief that there is only so much wealth and work to go around. This is not true. As economist Richard Ebeling has noted, “Flexible markets and competitive prices and wages are always able to accommodate greater supplies of useful things, including labor.”

Historian Becky Akers, who has studied the American government’s growing role in immigration offers a chilling conclusion:

“When immigrants have to show papers proving they belong here, we do, too. When the State is permitted to brutalize them, it practices tactics it can turn on us. Perhaps most frightening of all is the reflection that a government strong enough to keep others out is also strong enough to keep us in.

“As always, those who ask [Government] to shackle others often wind up wearing the chains themselves.”

Arthur Foulkes writes a weekly column on business and economics. The Tribune-Star reporter is a Terre Haute native and long-time resident. He can be reached at (812) 231-4232 or arthur.foulkes@tribstar.com.

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