Powerline's Hinderaker: GDP Per Capita Key To Amnesty/Economic Growth Claim (Or, The Toilet Paper Fallacy)
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H/T One Old Vet

Over the past four decades—and especially since 2000—the share of income paid to workers in the form of wages, salaries, and other forms of labor compensation has steadily declined… the rise in the immigrant share of the U.S. labor force is the mirror-image of the decline in labor’s share of income.

writes Ed Rubenstein in his devastating July 14 essay Labor’s Share Falls as Immigrant Workforce Rises—So Why Do Democrats Support The Amnesty/ Immigration Surge Act? I see this as an imperative refresher for anyone seriously interested in the economic impact of America’s immigration disaster.

So is John Hinderaker’s July 14 Powerline piece Why Immigration “Reform” will make Americans Poorer.

In essence, it has dawned on Hinderaker (who apparently does not feel comfortable with numbers) that what matters in analyzing the economic effect of immigration is what happens to economic output per capita. Unless this rises there is no chance that increasing immigration will benefit native-born Americans as a whole.

Of all the arguments that are made in favor of comprehensive immigration reform along the lines of the Senate bill, perhaps the most disingenuous is the claim that it will boost the economy. Proponents of the bill…claim that admitting somewhere between 30 and 60 million new immigrants, over and above those authorized by existing law, will increase the GDP. Good Lord, I should hope so! That would be true unless every single one of them is unemployed. Increasing aggregate GDP is a ridiculously low bar…The relevant question, with respect to the economic impact of the Gang of Eight’s legislation, is what impact it will have on existing American citizens.

I call this the Toilet Paper argument. A 20% increase in the population will mean more toilet paper is used. Good for toilet paper vendors, but not necessarily for the well being of the American people.

Hinderaker quotes a friend who goes thoroughly through the math and concludes

Their plan is simply to import scores of millions of unskilled 3rd world immigrants, covered by a fig leaf of a few hundred thousand high skilled STEM workers, 90% of whom we can easily do without, in order to create “economic growth” — in the aggregate — by a massive population expansion from the outside–but not growth that will benefit existing native born Americans at all. And that is not counting the inevitable economic drawbacks of this grotesque giantism — overcrowding, land use issues, infrastructure deterioration, and environmental degradation, to name a few.

WHY would they want to do this?…to explode our population with essentially no discernible economic benefit to us — existing native born Americans? There are some very good, if ignoble, reasons, but they are left as an exercise for the reader.

One ‘good’ (by which he means cogent) ignoble reason, as Peter Brimelow has pointed out, is the huge wealth transfer to Plutocrats caused by depressing wage levels. Another, of course, is to elect a new people.


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