The Cure For GOP's Economic Illiteracy: More Julian Simon, Along With Ayn Rand

Finally, the Republican National Committee has come up with a solution to chronic joblessness on President Obama’s watch. And it is simple, elegant and brilliant. In fact, so simple, so elegant, and so brilliant that only a genius like illegal alien-baiter Kris Kobach, the notorious author of Arizona’s SB 1070, your-papers-please law, could come up with it. So what is the plan?

Ready? Hold on to your passports: Remove An Illegal Alien Today. Yes. That’s right. It’s easy.

Explained Kobach to the 100-plus gathering of RNC representatives – who dutifully incorporated the plan in the draft party platform: “If you really want to create a job tomorrow, you can remove an illegal alien today…That is the way to open up jobs very quickly for U.S. citizen workers and lawfully admitted alien workers.”

The platform committee also overwhelmingly voted to add language proposed by Kobach calling for the completion of a border fence, the end of in-state tuition for illegal immigrants, an end to sanctuary cities, and support for national E-Verify. In other words, every illegal-busting idea they could think of instead of one that would really work: Relaxing the borders or, at least, implementing a generous guest worker program.

But if I understand the deep economic logic behind the deportation plan, it is essentially this: the fewer people you have in the country, the more job options there are for people already here. If that’s the case, why just stop at deporting illegals. Why not also include in the RNC platform a plan to scrap the biggest source of job competition: Human reproduction. How ‘bout adopting a one-child policy -- a la China? After all, childbirth is the primary form of immigration, the primary way that new people come into the country. Imagine how much future unemployment we could cut.

But the late and great Julian Simon pointed out the fallacy in this line of argument way back when. Here’s what he said:

One reason that unemployment is not caused is that potential immigrants have considerable awareness of labor-market conditions in the U.S., and tend not to come if there is little demand for their skills. Also, immigrants tend to be varied in their skills and therefore do not have a disproportionate impact on a few industries.

At the same time, immigrants increase demand for labor across the range of occupations, because immigrants consume goods as well as produce them. This point is crucial, but too little understood. Immigrants not only take jobs, they make jobs. Immigrants create new jobs indirectly with their spending, and they also create new jobs directly with new businesses, which they are more likely than natives to start. A Canadian government survey found that almost 5 per cent of 2,037 immigrants surveyed had started their own businesses within the first three years in Canada. Not only did they employ themselves, they employed others, “creating” a total of 606 jobs. Expressed as a proportion of the 2,037 total immigrants, roughly 30 per cent as many jobs were created from scratch as total jobs were held by immigrants. Furthermore, these numbers surely rose after the three-year study period.

In other words, as I noted in my recent column, GOP’s Economic Illiteracy on Immigration: “New workers are not mouths that should be regretted because they eat, but hands and brains that should be welcomed because they grow the economic pie.”

Perhaps along with Ayn Rand, Paul Ryan could require his fellow GOPers to read some Simon too.

Update: The headline was modified to more accurately reflect the text after legitimate reader objections. (The original headline was: The Cure For GOP's Economic Illiteracy: More Julian Simon, Less Ayn Rand.)

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  • The Immaculate Trouser||

    Opportunity costs and comparative advantage loom large.

  • SIV||

    Also, immigrants tend to be varied in their skills and therefore do not have a disproportionate impact on a few industries.

    Excepting agriculture, construction, and unskilled manufacturing.

  • SIV||

    And the bottom rungs of the hospitality industry such as hotel housekeeping and restaurant kitchen work.

  • ||

    Yes, but those are all places where immigrants have a positive impace on the industry.

  • Pound. Head. On. Desk.||

    Yes, but those are all places where immigrants have a positive impact on the industry.

    Yep, that was my experience owning a business. Of my three best employees, one was an immigrant who barely spoke English when I hired him, one was the child of immigrants, and one was a functional addict.

    Come to think of it, Ayn Rand was an immigrant too.

  • Auric Demonocles||

    You have a picture of a pinata horse at the border, but no alt-text? How does that happen?

  • Dylan||

    A few days ago there was a post with a pic of a New Yorker cover featuring a man with a top hat and a monocle. There was no alt text. A tragedy.

  • Auric Demonocles||

    Every post without alt-text is a tragedy.

  • The Hammer||

    A single post without alt-text is a tragedy. A million posts without alt-text is a statistic.

  • shortviking||

    Don't be a statistic.

  • ||

    Trojan pinatas create jobs

  • Metazoan||

    Hey guys, since we support small-government, let's force every employer to become a deputy of homeland security!

  • Graphite||

    I'm pretty sure "more Ayn Rand" would also help the GOP to get over its anti-immigration stupidity. Take for example her answer to being heckled for being a foreigner, "I chose to be an American. What did you ever do, except for having been born?"

  • Metazoan||

    Yeah, that's a great quote. I'm not an Objectivist, but I did find the title odd, given that I'm pretty sure that Rand was not anti-immigrant.

  • Brutus||

    I was wondering about the gratuitous swipe at Rand, too. Now I see reading her was just an opportunity cost thing.

  • ShagNasty||

    I don't think these GOPers realize that illegal mexicans are practically subsidising our agricultural products by working fields for well under minimum wage. Plus they spend the vas majority of their meager earnings on american goods. How would these dicks like to pay twice as much for strawberries because they have to be picked by hand?

  • BakedPenguin||

    This is my thought. If these dildos ever succeeded in their Quixotic attempts to rid the US of those evul Mexicans, the economy would get much worse.

    But the Republicans are sooo much better on the economy. No, really.

  • GW||

    End the welfare gravy train, and you'll have a point. Here, we have schools that are going broke because of largely illegal immigration. So while some goods can be cheaper, let's not act like there isn't a cost on the flipside.

    I think you really need to live in an area that has seen lots of illegals come in before you can understand the effects on society.

    I can see the points of open borders, but when you have a population that crosses the border simply to leech off of what's already there, that's not doing us any good. We don't need any more leeches, we have plenty that are home grown.

  • Fluffy||

    So the landlords of illegal aliens aren't paying any property taxes?

    Wow, the lawbreaking here takes place on many levels!

  • The Hammer||

    Are you complaining about welfare, or illegal aliens in schools? Either way, why not focus on that rather than the tangential-at-best issue of immigration?

  • SKR||

    Were are you? I'm in L.A. in a predominantly immigrant neighborhood. I used to drive past the welfare office daily. I'm in the construction industry. My neighbor is a social worker. A good friend is a principal in LAUSD. And all of our experiences with immigrants, welfare, and education lead me to believe that you are full of shit.

  • Night Elf Mohawk||

    And all of my friends' experiences in the Valley in Texas lead me to believe that you are full of shit. I guess it's a Mexican standoff.

  • SKR||

    What I'm hearing is geography makes more of a difference than immigration.

  • Metazoan||

    All of this, instead of the obvious solution (making it easier to enter legally) combined with the reasoning re: jerbz, only makes it clearer that most people in favor of this hysteria are against immigration in general, despite their pleas to the contrary. If they weren't against immigration, but only illegal immigration (say, for security reasons- whether that is valid or not is irrelevant) then they would encourage a system that makes entry easy.

  • kingice||

    I agree, we should put an "Ellis Island" on the border. It worked before thats how my immigrant ancestors got in. What we are witnessing is slavery in our time.If you are an illegal immigrant you will work and not ask any questions about anything.It is wrong and it has to stop.

  • ||

    The GOP is engaging in the most cringe-worthy piece of performance art since Joaquin Phoenix's hip-hop career.

  • Killazontherun||

    That wasn't Zach Galifuckwhatus on the Atkins diet?

  • OldMexican||

    Explained Kobach to the 100-plus gathering of RNC representatives – who dutifully incorporated the plan in the draft party platform: "If you really want to create a job tomorrow, you can remove an illegal alien today... That is the way to open up jo very quickly for U.S. citizen workers and lawfully admitted alien workers."


    And if you want Americans to buy American, close the borders to foreign goods! And if you really want all Americans to have a guaranteed job, practice total econmic autarky and have women work their spinning wheels to make their own clothes and the men toil their own fields! Oh, what a sight that would be!

    Just like a Bruegel picture!

  • BakedPenguin||

    ...if you really want all Americans to have a guaranteed job, practice total [economic] autarky...

    If there was a bill in the House for "American Juche," I wonder how many would vote for it.

  • OldMexican||

    In other words, every illegal-busting idea they could think of instead of one that would really work: Relaxing the borders or, at least, implementing a generous guest worker program.


    Talk radio heads are already asking States to refuse giving driver licenses to "illegal immigrants" or to people that are not citizens (!!!)

    Yesterday, Laura Ingram repeated the usual rant against illegal immigrants - that they take American [sic] jobs - during an interview with some asshole that made a documentary against immigrants that nobody wants to watch. The economics illiteracy is strong with these ones.

  • The Immaculate Trouser||

    It's really a very silly viewpoint, especially when coupled with a lassiez-faire on foreign trade and markets in general.

    The worst that you can say about the economic impact of immigrants is that there may be some negative externalities involved (though the same can be said about any arbitrary human), but that they are not much different from a technological improvement to capital.

  • hacimo||

    It is true that legal immigrants start businesses and generate demand and if economic conditions are right their can be a net benefit to the economy. However this logic does not apply uniformly and it only applies to legal immigrants. Illegal immigrants cannot work in the legitimate economy. They are essentially slave labor that operates in a black economy where wages are paid in cash and labor laws are violated. Such workers are "good" for the economy only in the same sense that african slaves were good for the economy prior to the civil war. The primary beneficiaries of illegal immigrants are the employers who exploit the cheap illegal labor but many others benefit indirectly by gaining access to cheaper goods and services. Unfortunately, the lower rungs of the american workforce pay a very high price. Their wages and their standard of living are devastated by the competition. In addition, this generates unemployment and attendant social problem which then place a large burden on society. All in all legal and regulated immigration of skilled workers is good if we have a labor shortage in particular areas. However importation of cheap unskilled workers is never advisable in a modern economy. One of our main problems is that 30% of our young people do not graduate from high school and are fit for little else but manual labor. If all such jobs are taken by immigrants, there is no place for our own unskilled workers to go but onto the welfare rolls or into the prisons.

  • ||

    Everything you said was economically incorrect.

  • The Hammer||

    I stopped reading at "if economic conditions are right their." Maybe go down to Home Depot and hire an immigrant to do your typing for you.

  • OldMexican||

    Re: hacimo,

    However this logic does not apply uniformly and it only applies to legal immigrants.


    The Laws of Economics only apply to American citizens slash legal immigrants!

    You heard it first here, folks!

  • SKR||

    I use illegals all the time for construction. I don't exploit them. They all make above minimum wage and yet there are never lines of Americans trying to get that same work. Weird.

  • cavalier973||

    *They are essentially slave labor...*

    Tosh. One doesn't go to market to buy and sell Mexicans against their will.

    The problems you list concerning low-skilled American workers are more directly attributable to bad gov't policies rather than to immigration, legal or illegal.

  • cavalier973||

    I one asked my brother, who is vehemently anti-illegal immigration, what his feelings would be if we learned that the Mexican gov't had dumped billions of dollars of gold, silver, oil, and cutting edge technological machinery onto American soil--basically giving it to us. He wouldn't answer the question because he saw where it led. But consider the historical case of the aftermath of the Cuban Revolution: Castro chased out the rich Cubans and stole their stuff. The Cuban refugees subsequently turned the sleepy Southern town of Miami into an economic powerhouse. Castro thought he had seized Cuba's wealth, when what he really did was chase it into the U.S.

    Turning immigrants away is as boneheaded as turning away valuable resources and goods proffered as a gift.

  • Whahappan?||

    "Turning immigrants away is as boneheaded as turning away valuable resources and goods proffered as a gift."

    Even more so. What's a productive person worth over a lifetime? A helluva lot more than an ounce of gold, or a barrel of oil.

  • CampingInYourPark||

    "Even more so. What's a productive person worth over a lifetime?"

    There's an assumption in your statemtent

  • Homple||

    So, once again I ask: how many walk-in foreigners per year can our economy and society support? If that number is less than the number of people who want to come here, what do you propose do about it?

  • ||

    Let them self-not-immigrate.

  • The Hammer||

    There is really only one way to find that out. But that's not what you're going for, is it? Jesus, the anti-immigrant people are getting to be as dumb as the drug warriors.

  • Homple||

    We are already finding out that some places are having lots of problems with the numbers already coming in. Do you by any chance live near the border in Arizona, or anywhere in the vineyard / orchard / hop farm part of central Washington State, or in the parts of California that Victor Davis Hanson writes about?

    I would guess not.

  • SKR||

    When they can't make money they go home. I've seen it happen in the construction industry crash. The problem solves itself.

    Fucking markets, how do they work?

  • Homple||

    There seem to be quite a few places where they don't go home. I expect that you don't live in one of them.

  • califernian||

    Yes it's so fucking awful to live in San Diego. What the hell are you talking about?

  • Homple||

    I'm talking about places such as those Victor Davis Hanson lives in and writes about. He claims that non-coastal California is quite different from the coast:

    http://victorhanson.com/articles/hanson082012.html

  • SKR||

    Well, i can see how having to risk death crossing a desert to get back in the us once the economy turns around could have a chilling effect on immigrants going home.

  • califernian||

    latest numbers show net immigration from mexico is negative.

  • califernian||

    "So, once again I ask: how many walk-in foreigners per year can our economy and society support? "

    All of them. DUCY?

  • Cyrano||

    I don't get it -- not only was Ayn Rand about as pro-immigration as you can get, she was an immigrant herself. Am I missing a joke or sarcasm? I would hope that anyone posting on Reason's blog would have a bare minimum of knowledge about the major libertarian authors.

  • advancedatheist||

    And two high-quality immigrants - Francisco d'Anconia and Ragnar Danneskjold - play a role in her main novel. I doubt that a random Latin American and a random Scandinavian would have carried the same weight in Rand's story.

  • advancedatheist||

    Ironically Simon's world view conflicts with the implicit Malthusianism of Austrian economics. Simon celebrates man's ability to find cheaper substitutes for scarce resources, for example, the invention and launch of communications satellites which have replaced the need for millions of tons of the copper cables we would have otherwise needed to produce and position across the world for communications.

    Yet we've done something quite similar to that when we invented paper money as a cheap substitute for a scarce supply of gold. Austrian economists celebrate the former kinds of innovation regarding copper and other resources, but not the latter, because in their world view gold has to hold a privileged position as a hard constraint holding down man's economic activities.

    So what if some technological breakthrough turns gold from a rare substance into a throwaway material comparable to what happened to aluminum? Would Austrian economists call for the prohibition of this technology?

  • ||

    What the hell?

  • OldMexican||

    Re: advancedatheist,

    Yet we've done something quite similar to that when we invented paper money as a cheap substitute for a scarce supply of gold.


    Calling yourself "atheist" doesn't make you any less ignorant, A.

    If gold was as plentiful as paper, people would use something else as money and you would then make your stupid remarks regarding that particular commodity. The reason is because you ignore what is money. Leave the economics commentary to us, the adults and go play with your toys.

  • cavalier973||

    You seem confused about...well, about a lot of things.

    "Austrian Malthusianism" is an oxymoronic concept.

    Austrian economists, when they are speaking as economists, do not advocate the prohibition of anything (although, as human beings who love liberty, they perhaps advocate the prohibition of gov't prohibitions); they simply describe the likely outcome of a particular policy.

    Gold is important not because it restrains economic activity, but rather because it increases real economic growth by avoiding the inevitable waste caused by the malinvestment that accompanies fractional reserve banking and fiat money.

    Substituting paper bills for gold coins is not a new technology; it is rather the modern-day equivalent of mixing tin into silver coins. In other words, it is a form of fraud.

  • SKR||

    So the GOP platform is adopting the immigration position of the 1880s Workers Party?
    Racists and Communists are the new Baptists and Bootleggers.

  • Brutus||

    It baffles me to see the GOP doing this. I think a policy of "higher walls and wider gates" would be a huge draw, yet all the Ds want is wider gates and all the Rs want is higher walls.

  • ||

    Are they completely oblivious to the fact that Obama has deported more people than Bush did in 8 years? Or to the fact that our economy is so shitty that Mexican immigrants are going back to Mexico in large numbers?

    It's almost like they don't want to be elected to anything.

  • Objectivist, my ass!||

    "You have reached the blind alley of the treason you committed when you agreed that you had no right to exist. Once, you believed it was 'only a compromise': you conceded it was evil to live for yourself, but moral to live for the sake of your children. Then you conceded that it was selfish to live for your children, but moral to live for your community. Then you conceded that it was selfish to live for your community, but moral to live for your country. Now, you are letting this greatest of countries be devoured by any scum from any corner of the earth, while you concede that it is selfish to live for your country and that your moral duty is to live for the globe. A man who has no right to life, has no right to values and will not keep them.


    --Ayn Rand

  • ||

    Get back to us when not abrogating someone's individual rights is "living for" them.

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