What Does Free Trade Have to Do with Open-Borders?
This was a comment made in the comments section of Richard Epstein's post on free trade:
So, what does free trade have to do with open-borders?
My answer to that question, is...everything. Immigration restrictions are effectively tariffs. They restrict the trade of human capital, and trade restrictions ultimately make us poorer.
How do immigration restrictions make us poorer? Those of us who believe in free trade generally subscribe to the concept of comparative advantage. But the concept of comparative advantage, doesn't just apply to goods. It also applies to human capital.
Here's just one of many examples. Americans are typically good at jobs that require extensive use of the English language, while immigrants are not. Immigration allows Americans to specialize in language intensive jobs, while immigrants can specialize in non-language jobs. The skills of immigrants and US workers are complementary. As a result, we are all better off.
And just like imported goods are subject to inspection, we certainly have a right and responsibility to subject immigrants to criminal background and national security checks. But other than that, labor should be allowed to flow into the US without restriction, and that is the only position that is consistent with a belief in free trade.
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Comments:
May '10
Re: What Does Free Trade Have to Do with Open-Borders?
Damn, I love libertariarians. In fact, unlike Bill Mahr, I have too much respect for them to go around calling myself one. But this kind of crap is what keeps me from signing on.
Oct '10
Re: What Does Free Trade Have to Do with Open-Borders?
On the welfare argument, immigrants are not what is causing our country to go bankrupt. The elderly are. Immigrants tend to be young. Plus, the more people we have in the country, the lower the per person cost of national defense and debt service. Illegal immigrants, ironically, are even more of a net positive, because many of them pay in but are afraid to use services for fear of getting caught.
Also, think about this, the countries in the world with the largest welfare states are highly homogeneous. There is one point of view that says that people vote for a smaller welfare state when there is more diversity. So, one way to get a smaller welfare state is to increase the number of immigrants.
Jan '11
Re: What Does Free Trade Have to Do with Open-Borders?
For everyone! Private charities could do wonders. Of course that would mean that the parasites that are currently addicted to the welfare apparatus -- and freeload from it -- would have to convince the discerning eyes of someone who's not a government bureaucrat.
May '10
Re: What Does Free Trade Have to Do with Open-Borders?
When you can show me enforcement, and inspection, at the level of a truck load of imported parts, imported under free trade, then we can talk. Free trade dose not mean open boarders and dumping, it is simply a "process of accepting goods and materials." There is NO free trade for any living product, be it animal or vegetable, because of the threat of infecting our nation. The exact same rule applies to humans regardless of how you incorrectly portray economic value. Get back to us when unemployment is 4-5% and when local jurisdictions are willing to enforce immigration law.
Feb '11
Re: What Does Free Trade Have to Do with Open-Borders?
Wow. I mean WOW.
Mexifornia here we come.
Which is great, because California has plainly been the most successful US state at creating jobs and voting for a smaller welfare state.
Yes. That is what has happened in California. For Sure.
Jan '11
Re: What Does Free Trade Have to Do with Open-Borders?
Is there any country on Earth that currently allows unrestricted immigration? Is the U.S. supposed to be the first?
Interestingly, this post and all of the comments seem to assume that the immigration "free trade" is going to be essentially one way: from other countries to this one. Are we going to assume that the other countries are all going to throw their borders wide to any Americans who want live and work there?
Oct '10
Re: What Does Free Trade Have to Do with Open-Borders?
Some questions for those of you who are interested in immigration restrictions and quotas and laws regarding assimilation: - who are the "experts" who are going to be the chosen ones to decide who comes in and who doesn't, how many, how much assimilation is required, etc. Should we assemble a "panel of experts" to decide? - how do we prevent rent seekers from lobbying politicians on immigration policy - if I own a business, and I fly down to Mexico , and I find 10 people I'd like to hire. They are completely healthy, no criminal background and not a national security threat. Are you telling me that I shouldnt necessarily be allowed to bring that team of workers into the country? That if I did, that would make me a criminal? I am engaging in a private transaction that does not effect you, and you want to use the heavy hand of the federal government to prevent me from doing this? How is that conservative?
Jan '11
Re: What Does Free Trade Have to Do with Open-Borders?
Dumping is such a strange concept: a foreign business selling their goods at a cost that the producers in the domestic country cannot match.
Of course everyone focuses on the loss of activity of the domestic suppliers who once supplied the market. But they don't focus on the new economic activity of the business(es) who now import these 'dumped' goods nor do they talk of the consumer surplus to the consumer of these products.
The real strange part is that if two domestic companies did this to one another it would simply be a strategy to increase market share. And I guess the only reason why that's the case is because if firms in an industry ever tried to solicit congress for protection against a domestic company, it wouldn't play as well as it does against the unsavory foreign bogeyman with very bad intentions.
Feb '11
Re: What Does Free Trade Have to Do with Open-Borders?
No actually open borders would mean the US would cease to exist.
There are about 7 billion people on this planet. If some small percentage of them happened to decide to move here they would:
1) Locally outnumber Americans in the area happened to occupy, easily.
2) Thus would have no reason to assimilate into American culture, even if they were expected to by open borders advocates. If you doubt this read Victor Hanson's descriptions of his experiences in California- and I've got a few anecdotes about Dearborn, Michigan to share also.
3) Would vote for bennies for themselves, and the heck with those who pay. And no, it turns out that in practice those aren't actually the same people in our multiculti politically correct society.
4) Which will lead to war. So no we wouldn't end up in a happy libertarian paraduse- we'd end up with a continent sized Yugoslavia.
I think this a bad idea.
Feb '11
Re: What Does Free Trade Have to Do with Open-Borders?
LowcountryJoe
Dumping is such a strange concept: a foreign business selling their goods at a cost that the producers in the domestic country cannot match.
You're missing the fact that the "cost" is in fact a measure in a fiat currency susceptible to all sorts of manipulation. That's why we can often read of foreign governments intervening in foreign exchange markets to prevent the value of their national currencies from changing in a way that government does not want.
Jan '11
Re: What Does Free Trade Have to Do with Open-Borders?
Xennady
LowcountryJoe
Dumping is such a strange concept: a foreign business selling their goods at a cost that the producers in the domestic country cannot match.
You're missing the fact that the "cost" is in fact a measure in a fiat currency susceptible to all sorts of manipulation. That's why we can often read of foreign governments intervening in foreign exchange markets to prevent the value of their national currencies from changing in a way that government does not want. · May 26 at 6:00pm
So 1) the foreign government expends resources to subsidize firms domestic in their countries so that 2) those foreign firms will make things at low cost so that 3) those firms will sell those things cheaply in our country so that 4) consumers from the United States will benefit from such foolish expenditures by foreign governments designed to keep their labor busy? Sign me up for that!
See Russ Roberts short editorial (4th paragraph), Why We Trade.
Oct '10
Re: What Does Free Trade Have to Do with Open-Borders?
It seems to me that the people who favor this idea think that you can only be for free trade if you're for absolute free trade. I can be for free trade and secure borders without that being hypocritical or contradictory.
I'm for free speech, but not absolute free speech (no shouting "Fire!" in a crowded theater...unless there's a fire). I'm for gun ownership, but not absolute gun ownership (no felons, no mental cases). Does that mean I'm anti-First Amendment? Does that mean I'm anti-Second Amendment? Of course not.
The absolutist premise of the original post - that "labor should be allowed to flow into the US without restriction, and that is the only position that is consistent with a belief in free trade" is flat-out false.
Jul '10
Re: What Does Free Trade Have to Do with Open-Borders?
This strikes me as an unconvincing argument. There's no dearth of labor. There is, however, a limited supply of willing labor at the price you hypothetically want to pay.
You wouldn't fly down to Mexico to get 10 bag-boys for 9 bucks an hour. The only reason it's an issue is because you'd plan to break laws regarding minimum wage, social security, unemployment insurance, etc.
Why not remove the actual barriers to labor?
Nov '10
Re: What Does Free Trade Have to Do with Open-Borders?
Yeah, that's precisely the point that (many) libertarians and Mr. Beamen do not understand. Economics is always inherently epiphenomenal to the political.
All markets, contracts, and associations among individuals presuppose an absolute prior agreement to the "game" or to the whole arrangement. These are decided before the fact, which is to say politically. One first has to have an established rule of law, justice being the fundamental political term. Justice segues to the question of the good.
Last I checked, John Locke, Adam Smith, etc., did not argue for, say, lax immigration with respect to peoples of whatever character so long as they have efficient job skills. Locke, Smith, the Founders were actually not libertarians. They held a concept of the public good--a collective teaching regarding the good as fit for a people of a certain character, habits, dispositions. "Self-interest" understood exclusively by itself is not education in personal morality. In other words, they did not hold morality or happiness to be idiosyncratic as based on pure individuality (autonomy), which I explain further here.
Feb '11
Re: What Does Free Trade Have to Do with Open-Borders?
"So 1) the foreign government expends resources to subsidize firms domestic in their countries so that 2) those foreign firms will make things at low cost so that 3) those firms will sell those things cheaply in our country so that 4) consumers from the United States will benefit from such foolish expenditures by foreign governments designed to keep their labor busy? Sign me up for that!"
No, actually what happens is 1) foreign governments print fancy paper or peg their currency to the dollar 2) so those foreign firms will have a market to sell to, regardless of their actual efficiency 3) causing American producers to go bankrupt, resulting in our labor being unemployed so that 4) consumers from the United States go deeply into debt on their credit cards or mortgage attempting to maintain the lifestyle their job used to allow them to maintain.
Hey, we've already been signed up for that. See the actual news headlines, today.
Jul '10
Re: What Does Free Trade Have to Do with Open-Borders?
Not yet! They're people. Those savages on 9/11 apparently had no "criminal background" either.
People kill, rape, steal, rob, trash, neglect.... and Y'all want to treat them as if they are commodities.
Why should Americans have to compete with foreigners' labor? I think foreigners, in order to become Americans, should have to compete with one another over who is more American.
Jan '11
Re: What Does Free Trade Have to Do with Open-Borders?
Economically - unrestricted immigration depresses the wages of existing workers (typically low wage workers) - they'll secure the border when lawyers, accountants and civil service workers start coming across. With a "normal" good or product, there are buyers and sellers that agree on terms, typically in advance of the exchange of goods/services - when your inventory is not moving/full, you don't import as much. In the case of illegal immigration, no such 'agreement/understanding' exists - the "goods" show up on our doorstep, even if we didn't place an order.
Aug '10
Re: What Does Free Trade Have to Do with Open-Borders?
Well Robert Lux, allow me to propose an alternate theory. I would submit that Locke, Smith et al did not argue for lax immigration because strict immigration was a construct of the 20th century. After their time as it were. Although your subscription to the increasingly Orwellian political speech is admirable, we have not always been at war with the bureau of customs and immigration. Oh and as for that absolute prior agreement thingy, I would submit the existence of both civil war and hyper-inflation in evidence against your 'theory. You need to work on your post-hoc ergo propter hoc fallacies.
Edited on May 27, 2011 at 4:20amMar '11
Re: What Does Free Trade Have to Do with Open-Borders?
My general opinion has always been that citizens love open borders until that immigrant comes for their job. In any case . . .
The mistake that is made in this article is that non-U.S. citizens do not have a comparative advantage as is defined by the economic community. A comparative advantage implies a playing field where people battle on the issues of intelligence, skills, availability, wages, etc. Not one where some prospective employees, within the same country, are willing to break the law and others are not. And that's what we are really talking about here.
The problem, however, does not start with illegal immigrants or U.S. citizens. It starts with U.S. employers. The immigrants wouldn't come here if they knew employers were following the laws that were on the books. We have created a situation here in the U.S. where employers expect government to work while, at the same time, they pay employees cash who, in turn, don't contribute one cent to that same government. That is a recipe for chaos. There is no economic principle that can resolve a situation where some people follow the law and others don't.
Jan '11
Re: What Does Free Trade Have to Do with Open-Borders?
Xennady:
No, actually what happens is 1) foreign governments print fancy paper or peg their currency to the dollar 2) so those foreign firms will have a market to sell to, regardless of their actual efficiency 3) causing American producers to go bankrupt, resulting in our labor being unemployed so that 4) consumers from the United States go deeply into debt on their credit cards or mortgage attempting to maintain the lifestyle their job used to allow them to maintain.
True, many Americans got used to their lifestyles and were spending beyond their means. This became noticeable once the housing market ceased to build equity for those in the process of owning a home and the cycle of sucking equity on refinancing came to a halt. This period is an adjustment period for the new economic realities. Trade wasn't to blame here. Unrealistic expectations and government policy that for too long tried to stave of the damaging effects of the 9/11 attacks and that encouraged home ownership were. We're better off because of trade and the unlocked value of division of labor.