Many conservatives do not normally think of it this way, but Center for Immigration Studies Director of Research Steven Camarota explained today that low-skill immigration is really just another government redistribution program. But this time, income is being redistributed from the poor to the rich. At a Center for the National Interest luncheon, Camarota explained:
Basic economic theory predicts that immigration should create small net gains for natives, about two-tenths of one percent of GDP, it’s called the immigrants surplus, there is a formula for calculating it. But to do so, it has to significantly redistribute income.
Immigration redistributes about $400 billion of a year. If you take the immigrant’s share of the work force, it looks like the losers lose about $400 billion, and the winners win somewhat more than $400 billion. So there is a small net gain. But the gain is about $35 billion. The redistribution is much bigger than the net gain. That is non-controversial. That is what the National Research Council found.
Now remember, immigrants are not evenly distributed throughout the economy. Approximately six percent of lawyers are immigrants. But about 50 percent of hotel maids are immigrants. So what that means is that for the 850,000 native-born Americans who are maids, immigration will exert a downward pressure on their wages by increasing the supply of workers. But if you are the hotel owner, and you are looking to hire maids, those lower wages don’t vanish into thin air. You retain them in the form of higher profits. So you gain.
The main concern in terms of the labor market is that the losers tend to be those with the least education. Americans who don’t graduate high school, Americans who only have a high school education. They are the ones who face greater job competition, in jobs like construction and hotel maids, nannies, bus boys, that kind of thing. Those wages have not done very well in the last 30 years.
Camarota’s analysis also doubles as an explanation of the politics of the immigration debate on the Republican side. K-Street Republicans, like the Chamber of Commerce and Douglas Holtz-Eakin, generally support more low-skilled immigration because it raises the GDP and makes select big businesses more profitable. Grassroots conservatives and Tea Party Republicans generally oppose higher levels of low-skill immigration because it makes harder for the working poor to make a living.
Republicans like Sen. Marco Rubio, R-Fla., are betting that they can win more votes from immigrant communities that support amnesty then they will lose from grassroots conservatives who will see their wages continue to stagnate or go down.