Chief Economist Speaks on Immigration Reform

Philly.com It’s not hyperbole to say that immigration is among America’s most important economic advantages. Nothing makes our economy tick more than the energy of those who move here from the rest of the world. Not all of us benefit from the million or so immigrants who come here every year, but most of us do.

Much of the long-running debate over immigration policy stems from the worry that immigrants take jobs from Americans. Yet this is not so.

Generally speaking, immigrants either come with few skills and little education or are highly skilled and well educated. Many immigrants thus do menial work in agriculture, construction, and services such as housekeeping and landscaping, taking jobs that would go begging otherwise. Without them, prices for everything from fresh fruits and vegetables to child care would be higher.

Many other immigrants are among the world’s best and brightest. The percentage of Ph.D.s among immigrants to the United States is nearly twice that of the general population. Immigrants file for patents at a rate three times that of U.S.-born citizens. These are the scientists and researchers who drive innovation and technological change. Their talent is key to America’s ability to create what the world wants and needs. And there are no higher-paying jobs than those in companies that make these things.

Immigrants also tend to be entrepreneurial. They start new businesses nearly a third more often than do native-born Americans, helping drive job growth. Such risk-taking is what has historically distinguished the U.S. economy from much of the rest of the world.

Immigration is also important to promoting foreign trade and investment, which are keys to long-term economic growth and more jobs. Immigrants naturally have very strong relationships with overseas businesses and the capital necessary to make these ties meaningful.

The notion that immigrants are a burden on U.S. taxpayers is also wrong.

Taxes paid by legal and illegal immigrants and their children dwarf the costs of the government services they use. The Social Security Administration has acknowledged that immigration is a net plus for the finances of the Social Security trust fund, and the nonpartisan Congressional Budget Office has determined that giving the 11 million undocumented foreigners living in the United States a path to citizenship would ultimately be a net plus for the nation’s finances.

Border states, including Arizona, California, Florida, New Mexico, Nevada, and Texas, do suffer a disproportionate financial burden educating and providing health care to immigrant children, and border security is a real concern. However, the solution is not to curtail immigration but for the federal government to help shoulder these costs and make the borders more secure.

Concern that immigrants aren’t assimilating also appears misplaced. Nearly all children of foreign-born U.S. residents speak English after a few years of living here, and the percentage that does not isn’t materially different today than it was a quarter- or half-century ago. The perception that immigrants are disproportionately incarcerated is also simply incorrect.

However, for foreign immigration to continue to be a significant economic plus, our immigration laws need a substantial overhaul. A path to citizenship for the illegals already living here is important. There is no feasible way to force people to return to their countries of origin, and their illegal status makes them scared and vulnerable.

Moreover, many illegal immigrants work at jobs that don’t take advantage of the skills they arrived with or have acquired working here, sometimes for many years. With legal status, they will be able to take more productive jobs and earn better pay, allowing them to spend more and pay more in taxes.

An even more important priority is providing visas for highly skilled workers. The United States gave out more of these visas during the technology boom than it does currently, when we arguably need the talents of these workers even more. Indeed, why not give a visa to any foreign student who graduates from an accredited U.S. university? U.S. schools attract the world’s best, and many want to but cannot stay after they obtain their degrees. If you earn a degree, you should also earn a visa.

Allowing more skilled immigrants will become even more important in the coming decades. The baby-boom generation is in middle age and quickly headed toward retirement. Many are already leaving the workforce. At the current immigration pace, growth in the labor force will slow to a crawl a decade from now. It is hard to believe, but our biggest economic problem won’t be high unemployment but a lack of qualified workers.

The chances for immigration-reform legislation are as good as they have been in years. Let’s hope Washington follows through. Nothing is arguably more important to our nation’s long-term economic health.