One way or another, they sit huddled together quietly, usually with some sort of blanket draped over their backs. They are fatigued, but alert. Wherever they are, whether on a boat or a truck, they are all trying to immigrate to a new land. From the Indonesians going to Australia, the Libyans going to Italy, the Mexicans going to the US, or the Rohingyas going to wherever that accepts them, these migrants leave everyone and risk everything for a chance to get out and get in. Most have grown insensitive to these news, barely raising their eyebrows as they come across these headlines. At the same time, there are also many who share statuses, wear T-shirts, attend rallies, host meeting, and everything else they can do to bring light to the issue. Lastly, there the policy makers who talk about it and… just talk about.
Immigration policy is a hot topic. It stirs up xenophobia. The fear of the undesirable economic, community, and identity impact is enough to turn an otherwise kind individual nasty. Simply put, there is no shortage of why dislike newcomers. However, I believe the popular opinion against immigration actually fails to understand the whole issue. A closed door immigration policy leads to conflicts and economic inequality.
First, the closed door policy strengthen dictatorships and their regimes. For instance, before fences, the immigration centers, and the passports, people were able to migrate more freely. As self-interested humans as they are now and forever will be, they go to places that gives them the best opportunity. Under this system, people flee oppressive regimes more freely for fairer rules. This mobility punishes the bad kings and rewards the good kings since the size of the population determines the kingdom’s military and economic strength. A large population allows a large military, a large tax base, and a large pool of productive workers. As a result, there is a natural accountability system in place to promote progress. However, this current system breaks the natural order. For instance, because developed countries set strict limits on immigration, the policy is not able to accommodate all those who wish to come to enter. Therefore, they are forced to stay and empower the bad kings’ military and economic strength. This translates to a false legitimacy for the bad king, lending him credit and enabling him to conduct the further oppressive policies. So what does this mean for those in the developed countries and how does this hurt them? The closed policy fosters these bad kings, allowing the so called Axis of evil countries to continue their ways. In the end, at least in the case of the US, this leads to military conflict, death, hatred, and terrorism. The xenophobia and closed door policy contributes to the death of young soldiers, terrorist attack victims, and countless tragedies. One may have been able to minimize change by rejecting immigrants, but one has also contributed to a more violent, unstable, unsafe, and tragic world for everyone.
Second, the closed door policy contributes to greater inequality. It is true that the family and environment one is born in plays a great role in determining one’s economic well-being. However, except for the extremely impoverished and wealthy tails of the normally distributed population, most probably lie somewhere in the middle, only differing by the type of house they live in and the type of vacation they go on. As a result, for this group of general population to become richer, they need to work to accumulate their wealth. Yet, it is always easier said than done. High paying jobs are competitive and wage growth is slow. There are many theories behind wage growth, such as the labor productivity gains, the technological improvements, and a country’s monetary policy, but I would just like to focus on one, the supply and demand of the labor. I believe now that developed economies have most of their basic needs met, such as food, housing, clothing, and transportation, the equilibrium supply and demand price has little room to grow. The peak in demand leaves little room for wage pressure; the political pressure to keep employment high leaves little space for supply cuts. These forces combine to cap a lid on wage growth. It is true that new demand can be created, but niche demands only has enough room to benefit a selected few and structural demands take time to form. Therefore, the only logical answer to this wage growth cap is markets with new demands. When one looks around, one will realize there are many such markets. These emerging markets have insatiable demand for modern goods and services, which can translate to high equilibrium supply and demand prices. While it is debatable whether these emerging markets can afford all the modern good and services they need or want, the demand is irrefutable. As a result, anyone who can supply this demand will make a fortune right?
Wrong. Only a selected few will be able to supply this demand. Since those with a deep enough pocket to negotiate with foreign governments and those with a long enough investment horizon to wait for emerging market consumers to pay are able to supply the demand, common folks will lose out again. They may observe the demand, but will not be able to supply the demand and drive up their supply and demand equilibrium wage. As a result, large corporations will again be able to keep a wage ceiling on such jobs due to the large labor supply. They will again either work for in a low wage growth job or fight to death for the competitive, high paying job. In the end, those fortunate enough to be born in the extremely wealth tail of the population will win out again. However, it does not have to be like this. In a more freer border environment, the entry barrier to these emerging markets may be lower and an eager entrepreneur may have a fighting chance against the big corporation. Furthermore, a freer border environment may have a strengthened accountability system mentioned before and the emerging market and developed country gap may be smaller.
Obviously, there are many other things to consider when it comes to immigration. A country’s fiscal budget has to be conserved, a community’s tolerance for foreigners is limited, and most of all, politicians’ political lives are fragile. In the end, whether developed countries’ closed door immigration policies to those in need lead to military conflicts and domestic inequality, politicians will just continue to talk about and… just talk about it.
