President Trump never tired in his campaign of bragging about his degree from the Wharton School of Business. We couldn’t help but notice that Wharton has shredded the anti-immigration RAISE Act that Trump endorsed:
Penn Wharton Budget Model projects that contracting net legal immigration will decrease GDP relative to current law, despite changing the skill mix toward more educated immigrants. If immigration is decreased by 50 percent, the economy will be two percent smaller in 2040, even though 75 percent of those immigrants will now have at least a college degree. Between now and 2040, the economy will grow at about 1.6 percent per year on average rather than about 1.7 percent.
Wharton’s analysis continues: “The RAISE Act also reduces employment because the domestic worker participation rate won’t increase enough to fill the jobs that would have been held by immigrants who are no longer allowed in the country. . . . In its first year, under the RAISE Act, we project 92,538 fewer jobs. After 10 years, job losses increase to 1.3 million relative to current law. By 2040, 4.6 million jobs are lost.” In sum, the RAISE Act “will lead to less economic growth and fewer jobs than otherwise. Job losses emerge because domestic workers will not fill all the jobs that immigrant workers would have filled. While in the short run the RAISE Act leads to a small boost to per capita GDP, in the long run per capita GDP dips slightly.” Put differently, there is no economic justification for the bill.
That leaves several explanations as to why Trump, who from time to time has praised legal immigration, would jump on the bandwagon: 1) Stephen K. Bannon, advocate of “blood and soil” nationalism, told him to; 2) Trump didn’t learn much at Wharton and doesn’t have a college freshman’s grasp of labor economics; or 3) Trump knows it’s a ridiculous bill but is desperate to please his base, which is drifting away. (Some combination of these factors may be at work.)
The same question — why support this? — might be asked of the overly ambitious Harvard graduate Sen. Tom Cotton (R-Ark.), who co-sponsored the legislation. Presumably he isn’t being told what to do by Bannon. He sure seems smart enough to have mastered Econ 101. Cotton quite plainly is playing the alt-right card, positioning himself as the natural successor to Trump.
Perhaps other Republicans will see this plan for what it is: the inevitable result of a party that has been intellectually corrupted, relying on the ignorance and anger of voters to raise money and keep it in power. As Jonathan Blitzer wrote:
It’s unlikely that the [Raise] Act will become law—even today, many Republicans in Congress would likely vote against it. (Some, like Lindsey Graham, have already publicly criticized it.) But in Trump, nativist activists and lawmakers finally have someone in the White House who speaks their language. ‘For the first time ever, a President has sought a reduction in legal immigration” [said Muzaffar Chishti, an immigration expert at the Migration Policy Institute]. “Even when Congress has been hostile to immigration, the President has always stood on the other side of the issue. This is from Wilson to Truman; it was true of Kennedy and Johnson and Reagan, all the way to George W. Bush and Obama. There have been no exceptions—until now.”
Unfortunately, if the future of the GOP is with the Tom Cottons, Trump will not be seen as the exception to the rule but the beginning of Republicans’ embrace of the counterproductive goal to keep the world’s best and brightest off our shores. If only Trump had learned something at Wharton.