By Robert J. Samuelson
Wednesday, March 22, 2006
Economist Philip Martin of the University of California likes to tell a story about the state's tomato industry. In the early 1960s, growers relied on seasonal Mexican laborers, brought in under the government's "bracero" program. The Mexicans picked the tomatoes that were then processed into ketchup and other products. In 1964 Congress killed the program despite growers' warnings that its abolition would doom their industry. What happened? Well, plant scientists developed oblong tomatoes that could be harvested by machine. Since then, California's tomato output has risen fivefold.
It's a story worth remembering, because we're being warned again that we need huge numbers of "guest workers" -- meaning unskilled laborers from Mexico and Central America -- to relieve U.S. "labor shortages." Indeed, the shortages will supposedly worsen as baby boomers retire. President Bush wants an open-ended program. Sens. Edward M. Kennedy (D-Mass.) and John McCain (R-Ariz.) advocate initially admitting 400,000 guest workers annually. The Senate is considering these and other plans.
Gosh, they're all bad ideas.
Guest workers would mainly legalize today's vast inflows of illegal immigrants, with the same consequence: We'd be importing poverty. This isn't because these immigrants aren't hardworking; many are. Nor is it because they don't assimilate; many do. But they generally don't go home, assimilation is slow and the ranks of the poor are constantly replenished. Since 1980 the number of Hispanics with incomes below the government's poverty line (about $19,300 in 2004 for a family of four) has risen 162 percent. Over the same period, the number of non-Hispanic whites in poverty rose 3 percent and the number of blacks, 9.5 percent. What we have now -- and would with guest workers -- is a conscious policy of creating poverty in the United States while relieving it in Mexico. By and large, this is a bad bargain for the United States. It stresses local schools, hospitals and housing; it feeds social tensions (witness the Minutemen). To be sure, some Americans get cheap housecleaning or landscaping services. But if more mowed their own lawns or did their own laundry, it wouldn't be a tragedy.
The most lunatic notion is that admitting more poor Latino workers would ease the labor market strains of retiring baby boomers. The two aren't close substitutes for each other. Among immigrant Mexican and Central American workers in 2004, only 7 percent had a college degree and nearly 60 percent lacked a high school diploma, according to the Congressional Budget Office. Among native-born U.S. workers, 32 percent had a college degree and only 6 percent did not have a high school diploma. Far from softening the social problems of an aging society, more poor immigrants might aggravate them by pitting older retirees against younger Hispanics for limited government benefits.
It's a myth that the U.S. economy "needs" more poor immigrants. The illegal immigrants already here represent only about 4.9 percent of the labor force, the Pew Hispanic Center reports. In no major occupation are they a majority. They're 36 percent of insulation workers, 28 percent of drywall installers and 20 percent of cooks. They're drawn here by wage differences, not labor "shortages." In 2004, the median hourly wage in Mexico was $1.86, compared with $9 for Mexicans working in the United States, said Rakesh Kochhar of Pew. With high labor turnover in the jobs they take, most new illegal immigrants can get work by accepting wages slightly below prevailing levels.
Hardly anyone thinks that most illegal immigrants will leave. But what would happen if new illegal immigration stopped and wasn't replaced by guest workers? Well, some employers would raise wages to attract U.S. workers. Facing greater labor costs, some industries would -- like the tomato growers in the 1960s -- find ways to minimize those costs. As to the rest, what's wrong with higher wages for the poorest workers? From 1994 to 2004, the wages of high school dropouts rose only 2.3 percent (after inflation) compared with 11.9 percent for college graduates.
President Bush says his guest worker program would "match willing foreign workers with willing American employers, when no Americans can be found to fill the jobs." But at some higher wage, there would be willing Americans. The number of native high school dropouts with jobs declined by 1.3 million from 2000 to 2005, estimates Steven Camarota of the Center for Immigration Studies, which favors less immigration. Some lost jobs to immigrants. Unemployment remains high for some groups (9.3 percent for African Americans, 12.7 percent for white teenagers).
Business organizations understandably support guest worker programs. They like cheap labor and ignore the social consequences. What's more perplexing is why liberals, staunch opponents of poverty and inequality, support a program that worsens poverty and inequality. Poor immigrant workers hurt the wages of unskilled Americans. The only question is how much. Studies suggest a range "from negligible to an earnings reduction of almost 10 percent," according to the CBO.
It's said that having guest workers is better than having poor illegal immigrants. With legal status, they'd have rights and protections. They'd have more peace of mind and face less exploitation by employers. This would be convincing if its premise were incontestable: that we can't control our southern border. But that's unproved. We've never tried a policy of real barriers and strict enforcement against companies that hire illegal immigrants. Until that's shown to be ineffective, we shouldn't adopt guest worker programs that don't solve serious social problems -- but add to them.