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Potomac Crossings
--By George Mason
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Immigration: Raindrops or Deluge?
It is difficult for Americans to deny their historical belief that it is wrong to return
refugees to an evil tyranny from which they have escaped. But not in today's world. One of the most startling reactions
to the Elian Gonzalez media coverage was the virulent racism and strident nativism that erupted from beneath the
parenting psychobabble. There were plenty of folks willing to say, "Nothing for Cuban-Americans unless my
ethnic group gets the same treatment" and plenty more who simply said " All illegal immigrants should
be promptly sent back to where they came from." The immigration debate was not just fueled by the cable news
network's need for sensationalism; skilled worker immigration has been a steady source of political funding appeals
in Silicon Valley by the Clinton-Gore operation. In half-a-dozen states and major cities, one key question this
fall will be, is immigration a gentle rain or a raging flood? Let's look at the facts.
The high-tech community over the last eight years has poured money into Democrat campaigns for the ostensible purpose
of accomplishing a three-part agenda: (1) protection from frivolous shareholder lawsuits, (2) a reduction of the
capital gains tax and (3) an increase in skilled immigrants under the H1-B program. The Valley has never seemed
to understand that both party activists and unions oppose employment-based immigration. The first two items on
their agenda were vetoed by the Clinton-Gore administration. (The Justice Department gave them frivolous federal
lawsuits instead.) So, what about the H1-B (high skill workers) immigration issue?
Studies by the Cato Institute demonstrate that high-skill immigrants create American jobs. Stephen Moore calculates
that every additional H1-B tech worker brings about $110,000 of free human capital. " It's reverse foreign
aid," he says. " An additional 50,000 H1-B immigrants visas is the equivalent of a $5.5 billion transfer
of wealth from the citizens of foreign countries to the citizens of the United States." Each newcomer adds
about four new Silicon Valley jobs for Americans. The U.S. firms founded or co-founded by immigrants employ more
than 68,000 American workers and produce about $28 billion in U.S. output. They include names such as Intel, Sun
Microsystems and Computer Associates. About one-third of their scientific employees are foreign-born.
For a century or more, Americans have carried two contradictory attitudes about immigration. They are against it
in the abstract. They are for it when they look backwards or when they know an immigrant personally. Writing in
1919, American public opinion was summarized this way" " The folks who came here in earlier times were
pretty good people but the ones who are coming now are not." It hasn't changed much since, polls attest.
Immigration is a significant political factor in six states: California, New York, Texas, Florida, New Jersey and
Illinois. Over 90 percent of the foreign-born population settle in urban areas such as Los Angeles, New York, Miami,
Chicago, Washington, Houston and San Francisco. The issues they create will be up for debate this fall.
Political Favoritism. While high-tech firms lobby for skilled workers, current regulations are tilted towards
the less skilled relatives of present U.S. citizens. Some 65 percent of legal immigrants gained entrance as relatives
of citizens but just 13 percent were admitted on the basis of their skills. There are two significant abuses created
by this current policy.
The first is that the law allowing unlimited immigration of family members has proven attractive to families who
bring in elderly relatives for the purpose placing them on welfare. The lifetime cost of each new elderly immigrant
has been estimated at $150,000 with little or no tax payments to offset the expense. About 7 percent of all immigrants,
primarily Asian, are over 60 when they legally come to the United States. Although families must pledge to INS
officials that their elderly relatives will not become public charges, about one-third of immigrants over 65 who
were sponsored for entry between 1980 and 1987 were on welfare by 1990, according to a University of California
at Davis study.
The second abuse is the influx of poorer, less-educated and less-skilled immigrants. The success of immigrants
correlates to their legal status, their education and the resources they possess when they arrive. The real wages
of low-skilled American workers, such as high-school dropouts, has declined. Today's economy creates virtually
no new net jobs for high school dropouts. A Rand study of 9 million net new jobs created in California in the last
30 years shows that three-quarters required at least some college education and the remainder required graduation
from high school.
Nearly 40 percent of immigrants have less than a high school education, double the rate of the native-born population.
Some 23 percent of immigrants have less than nine years of schooling compared to just 4 percent of native-born
Americans. Over their lifetimes, unskilled immigrants will likely use more in public services than they pay in
taxes, according to the National Research Council.
Stereotypes Abound. Newcomers tend to be either high-skilled or low-skilled. There are few in the middle. According
to the Census Bureau, there are about 24 million legal and illegal foreign-born people in the U.S. Some 80 percent
are here legally. They constitute about 9 percent of the population. While the percent is rising, it is at the
low end of immigration rates for the Western democracies. Australia, for example, is about 23 percent, Canada about
16 percent and France a little over 6 percent. Two-thirds of illegal immigrants come from Latin America and the
Caribbean. As the U.S. population ages, two-thirds of replacement population will come from immigration rather
than births.
The National Science Foundation reports that after about ten years, recent immigrants earn wages about equal to
natives with similar levels of schooling. An earnings gap persists but it is attributable to education levels,
not immigrant origins. As their life evolves, immigrants not only supply labor; they increase the demand for labor.
By starting businesses and spending their earnings, they create as many jobs as they fill, according to Stuart
Anderson. Because immigrants are employed in addition to, not instead of, native-born Americans, they have minimal
impact on the labor market.
While new immigrant families tend to receive more government services during their early years, the longer they
stay, the more they pay in taxes. The U.S. Commission on Immigration Reform reports that the average immigrant
pays about $80,000 more in lifetime taxes than he or she consumes in benefits. There is a catch, though. The taxes
by and large go to the federal government while state and local governments pay the benefits. States and municipalities
pay out $25,000 more than they receive while the federal government receives $105,000 more than it pays out.
The half of immigrants who come to the U.S to begin their working years will pay $500 billion more into Social
Security than they will receive in retirement benefits. After 10-15 years, immigrant households with a naturalized
citizen will pay an average of $6,580 in taxes compared to a native household's $5,080, according to the study
" A Fiscal Portrait of the Newest Americans."
How many are too many? In the decade from 1900-1910, about 10 million immigrants entered through Ellis Island and
we had far fewer Americans then. Their rate of immigration was about 12 per thousand residents. The last two decades
has seen some 8 million immigrants per decade. That's about 4 per thousand residents. The percentage of foreign-born
Americans is lower today that it was at any time between 1850 and 1940. "In those days, we needed strong bodies.
Today, we need strong minds," says Stephen Moore. "About 40 percent of science and engineering doctorates
are awarded to immigrants. We import brainpower from around the world to sustain the new frontiers of science and
technology."
When skilled workers come here, we import their creativity, capital and fresh global links. The issue is that the
jobs we are creating demand higher skill levels than most immigrants' display. In the absence of expanded entry
criteria based on education levels, knowledge of English and work skills, industry only has two other options:
stop growth or export jobs to the countries where workers are available.
Legislation has been introduced by Senator Spencer Abraham (R-Mich) and Representative David Dreier (R-Calif) which
would double or even eliminate the foreign tech-worker cap and fund scholarships in technology. Having bipartisan
support, the measure is expected to pass and be signed by President Clinton soon. An early measure of high tech
support in Congress was the House vote to extend the tax moratorium on Internet commerce. It passed 352-75.
###
| George Mason, 1725-92, was known as the Sage of Gunston Hall.
His Virginia declaration of rights, written in 1776, was the model for the first section of the Declaration of
Independence. A friend of Patrick Henry and Thomas Jefferson, Mason was an original drafter of the Constitution
and the first ten amendments to the Bill of Rights. He refused, however, to sign the final version of the Constitution
because he thought it did too little for individuals and, without the Bill of Rights, gave too much power to the
government.This column honors his memory. |
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