Is there actually a case for the wall?
Donald Trump’s boast to build a “big, beautiful” wall along the southern border clearly provided a lift to his candidacy, arguably delivering him the Republican presidential nomination. Along with his promise to deport millions of immigrants who are living in the United States without legal authorization, it remains the leitmotif of his campaign, despite occasional bursts of softer rhetoric.
Trump is not wrong that immigration from Mexico and other countries in the poorer south over the last quarter-century has injured some U.S. workers who competed with immigrants in the job market. It is not his concern alone; similar fears are shared by organized labor and others on the left of the political spectrum. Improbable as this may sound, the question he raises is legitimate.
But even looking at a best-case situation, the answer is still straightforward: No. Even if you care only about the workers most hurt by new immigrant labor, Trump’s proposals simply aren’t worth the cost.
In an article in the Journal of Economic Perspectives scheduled to be published this fall, Gordon H. Hanson and Craig McIntosh of the University of California, San Diego, lay out the most obvious reason walling off Mexico would be pointless: Mexicans aren’t coming anymore.
Those arriving in the 1980s and 1990s were born in the 1960s and 1970s, when Mexico’s fertility rate was as high as seven children per woman. Mexico was hit by repeated macroeconomic crises. To Mexicans growing up at the time, the prospect of a job in the prosperous U.S. economy of that era was worth braving the Arizona desert and the Border Patrol.
Mexico is a different country today. It is older. Since 1970, fertility rates have declined to just above the replacement rate of 2.1. Its labor supply is growing at about the same pace as that in the United States. And though Mexico is still much poorer, it is no longer prone to crises and unemployment spikes every couple of years.
“The completion of the demographic transition in most of the Western Hemisphere leaves one to wonder whether the benefits of continued U.S. enforcement spending will justify its costs,” Hanson and McIntosh concluded.
Of course, this won’t settle the argument to the satisfaction of Trump’s angry base of white working-class men. And perhaps the demographic analysis has blind spots. What about unauthorized immigrants from Africa and the Middle East, where fertility rates remain high, conflicts frequent and job prospects poor?
They might not be stopped with a literal wall – they are more likely to arrive legally and overstay their visa. But don’t they justify spending more on immigration enforcement?
I can’t think of anybody among the ranks of top immigration experts who would make for a better adviser to the Trump campaign than George J. Borjas. Over a long and prolific career, Borjas, a prominent Harvard economist, has written innumerable papers and books making a case for fewer immigrants and more restrictive immigration policies.
He has advocated a points system to favor more highly skilled migrants, arguing that the quality of immigrants deteriorated since national quotas were abolished in 1965. That opened the door to Mexicans and others of less schooling and skill, more likely to rely on public benefits. Perhaps most uncomfortably for those on the left, he forcefully makes the case that immigration hurts less-skilled Americans, those in most direct competition against low-wage immigrants from south of the border.
But even Borjas’ dire conclusions about the damage inflicted by immigration on U.S.-born workers makes a weak case for tougher border controls.
Borjas is not advising Trump. But he has waded into the political arena, once advising Pete Wilson, a Republican governor of California who ran a successful uphill battle for re-election in 1994 by proposing to bar illegal immigrants from schools and other government services.
Borjas acknowledges that the immigration surge to the United States from 1990 to 2010 produced a net benefit to the economy – $50 billion a year, according to a report to be published by the National Academies of Science. Still, he notes, none of this went to workers. Workers who dropped out of high school, he states, lost big.
Borjas’ economic research, outlined in his 2014 book “Immigration Economics” and reiterated in his coming “We Wanted Workers,” concluded that the two-decade immigration binge cut the wages of U.S.-born high school dropouts over the long term by 3.1 percent. This penalty, which takes into account how businesses would react by investing more in enterprises that could profit from the new immigrant labor, amounts to about $900 a year.
This analysis has been criticized by other scholars for making assumptions that make the picture look bleaker than it really is. For instance, it assumes that unauthorized immigrants without a high school diploma are perfect substitutes for U.S. workers without a high school diploma, an implausible proposition on language grounds alone.
But my argument is blunter: 3.1 percent, so what?
This is not to be callous. Of course $900 a year makes a difference to a worker making less than $30,000 annually. Nonetheless, a pay cut of 3.1 percent for 10 percent of the U.S. workforce seems modest compared with the price tag of ramping up immigration enforcement. What’s more, there are probably cheaper and more effective policies available than walls and police officers on the border.
Today immigration enforcement costs $30 billion a year and, by Trump’s own account, the border still feels like Swiss cheese. Should that be doubled? Quadrupled? What about the cost of finding and deporting 11 million people who have made their lives in the United States, in many cases having children who have a legal right to stay?
More significantly, perhaps, is the immense cost to the immigrants themselves – measured in lost opportunities to achieve a better life. This may be of no concern to Trump’s supporters. But it is worth pondering the cost to Mexican stability – and its knock-on effect on the United States – had Mexico suffered through the many crises of the 1980s and 1990s without the escape valve of migration.
And for all of Trump’s charges about immigrants becoming public charges, living at taxpayers’ expense, noncitizens are barred by law from most means-tested federal programs. While their children benefit from public education, most of those children are U.S. citizens, and their education is an investment that will pay off down the road, when they grow up to pay their share of taxes.
U.S. immigration policy during the last couple of decades may look like a mess. Still, “if we could turn back the clock,” Hanson said, “I’m not sure we would have done things differently.”
And if economics teaches us anything, it is that much of the money could have been better spent on something else. Instead of a new wall, how about an expanded earned-income tax credit? Or how about more training for low-skilled workers?
“Where should immigration policy be among the options to help workers with stagnant wages?” Hanson asked. “I think it should be pretty far down the list.”
For all his skepticism about the benefits from immigration, this is something even Borjas might agree with.
“Maybe we have to think about immigration in broader terms,” he told me. “Maybe the discussion should not be just about who gets a green card but about how the benefits of immigration could be more evenly distributed. That would clarify what is at stake.”
Eduardo Porter writes the Economic Scene column for the New York Times.