Daily Archives: 2011.02.19 15:22

Immigration, Protectionism and Freedom

Note: The following is a response to a widely circulated email regarding American immigration policy, which is reproduced at the tail of this article.

It could be enlightening to consider that every country compared against the United States below sucks horribly.

Perhaps we are framing the immigration issue the wrong way. Surely you are not suggesting that we should emulate the policies of such garden spots as Saudi Arabia or North Korea?

Are we forgetting why the free market made us great and how immigration is a part of that equation? The more protectionist we get the further we remove ourselves from our roots — a past where Federal spending was less than 3% of GDP, a minimum wage was nonexistant and well understood to be a market inhibitor (and contributor to inflation), government programs for everything from industrial subsidy to public healthcare didn’t exist and were not expected, and a lack of regulation on immigration and industry promoted innovation and competition on a scale never before seen in human history (It is interesting to note that today compliance with regulation in industry acts chiefly to impose significant barriers to entry for newcomers who don’t have large initial capitalizations. This effectively protects entrenched businesses who usually had a part in lobbying for the regulations themselves once they became political inevitabilities, and in no way protect the little guy who wants to try his hand at business. Also note the consumer doesn’t enter into the equation at all.).

We are now enjoying the fruits advenures into true free market capitalism and universal immigration made not by us, but by previous generations. Now that we have arrived in the information age and are more comfortable than any society in history ever has been (a unique situation where we have produced conceptual oxymorons such as the poor fat person, or people who are too poor to do anything other than “sit on ass and play vidya gaems”) we are becoming protectionist and frightened of true competition. This is slowing our minds, numbing us to the exhilerations of risk and diminishing our rewards. Our country is so overwhelmingly powerful that we have nothing to fear from open competition in every field from technical achievement to military contest.

If this were a trivial issue it would be comical that the center-right in America is the faction that has chosen immigration to be the politically acceptable way to manifest protectionist rhetoric in government (which leads to barriers to market entry by restricting the domestic labor pool) and the left has chosen international trade tarriffs and industry subsidy as their opposing politically acceptable form of protectionism (which leads to barriers to market entry in the form of regulatory compliance and a form of corporate welfare for noncompetitive pre-existing companies). They are both different shades of the same thing, but it is highly impolitic to say so to a member of either school of thought, mostly for emotional reasons.

If a Mexican wants to come to Texas to cut my grass for less than minimum wage, why should I be prevented from hiring him? If he is not merely making my property look nice, but is helping my business grow at a reduced cost by making products for me below the cost of other available labor, my company is now gaining in competitive advantage — critically, my company is not just gaining in competitive advantage against other US companies, but regaining some of the advantage lost to Malaysian and Chinese factories (which is, ironically, the origin of the protectionist argument to begin with). My state loses no tax revenue because the Mexican pays taxes every time he conducts a market transaction anyway. In a non-socialized state such as Texas or Florida this works well (contrasted with, say, California where a worker not paying income taxes dodges a large portion of his burden but can still reap state subsidized benefits).

Flipping to the other side, the left’s idea is generally to have the government make market decisions for us, the difficulty being that once the government enters the market place it is impossible to decide what market decisions it should and should not make — so eventually (and history is a good guide here) socialized governments tend to make all the market decisions, and badly. Identifying the scope of responsibility for a government in the market is so gray that it is impractical. The left will say they support the union and the average worker but in actuality their policies end up protecting entrenched corporate interest more than anything else by preventing newcomers from pushing into the market and insulating established large businesses from the consequences of bad decisions. They say that “unfair” competition from overseas is stealing American jobs and that we have to erect trade barriers and impose regulations on industry to keep the vile boom and bust of rampant competition down to a  “manageable” level (without quantifying what any of that means). Unfortnately this just means that instead of individual businesses experiencing boom and but cycles, entire nations boom and bust together (which is the cancer that is killing Europe right now, and the chief danger facing China today as well).

From my point of view, if the consumer decides that all the Chinese crap at Walmart is good enough at the price it is sold to continue buying it, who am I to stop him? (And the responsibility rests with me and you, as we vote for the micreants in office to get them there, after all. Not voting is also a deliberate choice, so no way out there.) After all, I don’t really want Americans doing monotonous plastic injection molding jobs and I don’t want the chemical leftovers in our country either.

If the Chinese government is willing to use its own people’s tax money to subsidize fundamentally flawed businesses that would fail without intervention only to create cheap goods that they then sell at a loss to me in the US, why stop them? Let the Chinese government absorb the cost of your cheap products for you. Subsidized Chinese goods shouldn’t say “Made in China” on them, but rather “Compliments of China”. If left alone, the situation would eventually balance out and the Chinese will either be forced to start charging more (making our superior products more competitive) or collapse (removing the challenge completely). I can guarantee that if a sudden lack of shitty plastic toys suddenly grips the market an alternative will emerge to replace them — either an American will stand up a shitty toy factory overnight, or more likely, an American will build a factory in Mexico to make the same (or better) stuff. Either way, we win and anyone else loses, because we were the ones who didn’t engage in self-destructive economic practices.

If the French government wants to lose boatloads of money subsidizing Airbus, why stop them? Boeing is only getting smarter against the competition and is still doing well in any case. I don’t see how having roughly 30% of each A300 sold below cost to an American corporation be provided for free by the French government is hurting us — if anything it is certainly hurting France, so this is not something I desire to stop because it means we are winning.

There is entirely too much emotion tied up in the debates of today, and our public dialogue has lost its logical foundation. The political rhetoric of fear of American decline has really gripped the country, and I can’t see why. I have been everywhere there is to go in the last decade. I’ve seen just about all of the globe in a working, not tourist, capacity — and almost everyplace sucks but the US and a very short list of its close friends. Pipe dreams of power abound around the world, but the next time someone starts talking about how America is failing and going to hell in a handbasket, or how we will soon be in the “post-American era” just ask yourself what alternatives are there to American power? Really how weak is the only nation that has absolute undisputed control of the all the oceans, absolute dominance of space and global air supremacy at will? Really how weak is the nation that everyone still craves to enter and build a life for themselves in? Really how weak is the nation that gave the information age its beginnings, from the lightbulb to the telegraph to harnessing nuclear technology to the programmable computer to the space shuttle to the open market and so on… ?

My point being, America has nothing to fear from competition and everything to gain. Every time America steps out into danger it gets busy doing things right, not because “it” does anything, but because the individual genius of its mish-mashed citizens is unleashed. Dramatic examples such as how Americans (as distinct from America, though that is also an interesting story) reacted to 9/11 or the entire history of American involvement in existinal struggles such as WWII get a lot of play, but less dramatic examples are just as important such as the universality of American businesses in the technical sphere, our unbroken naval supremacy and our enormous lead in space and information technologies.

Other governments seek to control the creative, economic, aggressive, randomly boiling potential of their people. The US government has from its beginning sought to deliberately unbridle and unleash the creativity, economic activity and aggression of its people. The worst decision we could make now is to send signals to our government that we want to be more heavily regulated and controlled. That sort of request for subjugation can begin with immigration policy or with trade protectionism — both are equally bad because they are essentially borne of the dynamics of the fear of failure. Populist traps are bad for America, regardless which way they are spun. Our personal freedoms are intimately tied to our economic freedoms in America in deeper ways than are immediately obvious when catching the headlines.

I strongly advise anyone who is at least curious about the arguments above to either study up on the history of these arguments or (more likely) catch the short version by watching Milton Friedman’s now forgotten video series Free to Choose.

Now take a look at the list below again and ask yourself if you would rather make America more like any in the list or less.

Cross the North Korean border illegally you get 12 years hard labor.

If you cross the Iranian border illegally you are detained indefinitely.

If you cross the Afghan border illegally, you get shot.

If you cross the Saudi Arabian border illegally you will be jailed.

If you cross the Chinese border illegally you may never be heard from again.

If you cross the Venezuelan border illegally you will be branded a spy and your fate will be sealed.

If you cross the Mexican border illegally you will be jailed for two years.

If you cross the Cuban border illegally you will be thrown into political prison to rot.

If you cross the United States border illegally you get:

1 – A job

2 – A driver’s license

3 – A Social Security card

4 – Welfare

5 – Food stamps

6 – Credit cards

7 – Subsidized rent or a loan to buy a house

8 – Free education

9 – Free health care

10 – A lobbyist in Washington

11 – Billions of dollars in public documents printed in your language

12 – Millions of servicemen and women who are willing to – and do – die for your right to the ways and means of our constitution

13 – And the right to carry the flag of your country – the one you walked out on – while you call America racist and protest that you don’t get enough respect.

IF YOU AGREE, COPY AND RE-POST THIS!