Political Notes 199, Immigration and Liberty in the Real World: A Libertarian Case for Restricting Immigration (2014), by Gary Stephenson

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Immigration and Liberty in the Real World: A Libertarian Case for Restricting Immigration

Gary Stephenson

Political Notes No. 199

ISSN 0267-7059 (print)
ISSN 2042-2776 (online)
ISBN: 
9781856376655

An occasional publication of the Libertarian Alliance,
Suite 35, 2 Lansdowne Row, Mayfair, London W1J 6HL.

© 2014: Libertarian Alliance; Gary Stephenson

Gary Stephenson studied Economic History at the London School of Economics where he became exasperated with leftist student politics but fortunately discovered the antidote in libertarianism.  He now works in the City of London as an IT consultant, occasionally finding the time to contribute political writings to various blogs and websites. 

The views expressed in this publication are those of its author, and not necessarily those of the Libertarian Alliance, its Committee, Advisory Council or subscribers.


FOR LIFE, LIBERTY AND PROPERTY

The debate

The immigration debate amongst libertarians is usually split into two factions.  The first are those who simply wish to discard all border controls and the second who want these to remain in some form or another.  In general terms libertarians who advocate a policy of open borders do so because immigration controls are seen as state interference in the free interaction of people.  They therefore see this as an abhorrent institution which has no place in a free society.  On the other hand are those who wish to retain border controls (albeit with reforms) either out of concerns of national composition or the negative economic effects on the poor of the host population.  Both sides have powerful arguments in their favour but I wish to explore why the most palatable policy option for a developed country to adopt today is the restriction of immigration from developing countries.  Although a world without borders is the libertarian ideal, if controls were abolished immediately it is likely the developed world would experience some very negative consequences indeed.  The most serious of these are the lowering of wage rates for the unskilled and the entry of people who are unfamiliar with or hostile to liberty.

Against controls

An absence of border controls is almost certainly the policy most consistent with libertarian principles.  The individual is a sovereign entity and provided he is not trespassing on another’s property can settle to live or visit anywhere he pleases.  Thus the foreigner is subject to the same laws as the native and is not discriminated against at all by the authorities being true to the non-aggression principle.  In theory, free immigration can bring wider benefits to both the immigrant’s native country and adopted country as well.  Labour will migrate to areas were capital intensity and wages are high while capital flows to areas where labour is cheap.  All things being equal this will result in an equalisation of wage rates as capital and labour reach their optimum ratios.  This should not result in lower wage rates in the capital concentrated economy over the long term; although wage rates may fall nominally in some sectors this will be offset by rising real wage rates as the economies become more integrated and efficient.  Thus free immigration is the corollary of free trade and exchange.  The alternative of restricted or closed immigration is in many ways the exact opposite: economic protectionism.  All the problems this entails have been thoroughly spelt out by economists before so I am not going to debunk that doctrine any further.  All this notwithstanding it would be a disaster for the developed countries if border controls were to disappear immediately.  The magnitude of the disaster would be incalculable if one country were to unilaterally adopt a policy of free immigration.

For controls

What would be the effects of open borders on the countries of Europe and North America if it were enacted tomorrow?  Certainly this would cause great upheaval in view of the lenient criminal justice systems, welfare and free health services on offer and perversely regulated labour markets.  The developed countries would be overrun with the poor of the developing world.  The capital stock of developed economies would be plundered, the police and prisons overwhelmed by a mighty crime wave with welfare states collapsing under the strain of the new arrivals.  Some might say this would be a good thing; the governments of the western world are degenerate and their demise will pave the way for a free society.  However, it is extremely naive to think that newcomers unacquainted with western customs and values will facilitate the establishment of a free society.  The end result of such a policy is the end of a civilisation similar to the fall of the Roman Empire in the fifth century.

To take an egregious example London has become populated in recent decades with a substantial Muslim Arab community.  Their treatment of women is thoroughly deplorable.  It is very distressing to see women in the twenty-first century covered from head to toe and not allowed to show their faces.  It is staggering that this is justified on the spurious grounds that lest a lustful male glimpses her it would compromise her dignity.  Even worse are the widespread practices of female circumcision, honour killings and the baffling precedent of blaming rape on the victim rather than the rapist.  People with such attitudes are unlikely to support a free society which libertarians wish to see.  Indeed libertarianism is virtually non-existent as a political force in Africa and the Middle East.  Yet immigration from these countries is encouraged by politicians and activists who seem oblivious to the danger of altering a society’s demographics with people who do not share liberal values.  Of course immigrants can be assimilated into a society and adopt its custom and values but this takes a long time because a society can only absorb small numbers of newcomers at a once.  For example, the United States experienced a great wave of immigration in the late nineteenth century from Southern and Eastern Europe.  It took several generations even for these immigrants to fully assimilate, demonstrated by inter-marriage rates, educational attainment and economic status.  This great wave was eventually halted by the Immigration Act of 1924 which capped the number of immigrants at 150,000 per annum thereby facilitating the assimilation process.  Constant mass immigration from backward parts of the world is definitely not conducive to the development of a free society.  An open border policy would severely inhibit to make impossible the ability of a society to assimilate and integrate the new arrivals.

If, however, the developed countries suddenly denied welfare and immigrants were obliged to cover the costs incurred of their stay this would mitigate some of the problems discussed.  Most of the immigrants would simply be people willing to work.  So does a policy of free immigration then become viable?  This is unlikely because of the huge depressive effect it would have on domestic wage rates, especially for the unskilled.  An increase in the supply of labour without a corresponding increase in capital is bound to lower wage rates in the short term for those working in the host country.  So severe would the effect be if borders were suddenly opened that the benefits of a more integrated and efficient economy would not be felt for decades given the economic disparity of countries across the world.  In the short to medium term, the poor of the developed countries would suffer lower wages, worse housing and a lower overall standard of living.  This is not something to be dismissed lightly as it is hardly an attractive advertisement for libertarianism.

To a large extent, the United Kingdom had a relaxed immigration policy in the 2000s when the borders were opened to the new EU member states in 2004 while the number of work permits to non-EEA nationals increased from the tens of thousands per annum in the 1990s to over one hundred thousand.  Unsurprisingly the result was an inflow of foreign labour competing with the British people for jobs, especially in the lower end of the labour market.  Median wages in the United Kingdom were stagnant from 2003 to 2008 despite GDP growth of 11 per cent in that period.1  Admittedly this could be mitigated by slashing regulations, public spending and taxation to increase capital intensity per worker and thereby real wages.  However, it does not alter the fact that labour immigration which imports barely any capital with it depresses real wages.  Indeed no libertarian scholars that I know of have made any attempt to deny that a large influx of immigrant workers depresses real wages for some workers in the host country.  David Friedman states in his essay ‘Open the Gates’, where he advocates a policy of open borders and mass immigration from developing countries, ‘[T]he new immigrants will drive down the wages of unskilled labor, hurting some of present poor’.2  Similarly Walter Block echoes this in his response to the charge ‘Unrestricted immigration will reduce the real wages of the workers already in residence’; he goes on to state ‘This charge, however, cannot be denied; it is true that under some circumstances, workers in the receiving country...  will lose out’.3  It is telling indeed that such enthusiastic proponents of mass immigration candidly admit that it would cause real wages for the unskilled to fall.

It is argued by some libertarians that such predictions are hysterical, that there would not be mass immigration to the relatively over populated countries of the developed world as per the law of migration and location according to Ludwig von Mises.  This can be summarised as follows: A country is overpopulated when the optimum population is exceeded.  An increase in population results in a decrease in welfare because the large population operates in less than favourable conditions of production.  So the same amount of capital and labour applied yields less returns compared to an under populated country.  Therefore, if people can migrate freely they will move to under populated areas.4  However what this theory seems to suggest is that when welfare in the receiving country relative to other countries begins to fall immigration to it will also fall.  Immigrants from the developing countries are used to very low standards of living compared to the inhabitants of the developed countries.  Living standards and welfare will then have to fall considerably to deter these immigrants from coming.  To be sure capital would then also flow to the developing countries but these countries are so poor it would take a long time indeed before welfare increases to deter emigration.  Until the welfare levels across the world are equalised the population of developed countries would therefore skyrocket if the borders were opened.  Some estimates state that nearly forty percent of some developing countries’ populations would migrate to developed countries if permitted.5  The poor in developed countries would therefore suffer much lower living standards while the immigrants themselves would probably not benefit greatly either.  The long-term consequence of this would be the altering of the developed world’s demographics and the certain danger this poses of destroying the makeup of a free society.

A pragmatic response

The arguments detailed above serve to rebut those who maintain that retaining border controls in the immediate future is a deviation from the libertarian ideal; a betrayal rather than a compromise that should not even be entertained.  I believe it is vital that on pragmatic grounds we must restrict immigration while the world remains so unequal.  The future which we should strive towards is one without borders but today a free immigration policy would be suicide for the west.  A compromise could be that developed countries open up borders between themselves.  This no doubt would produce some arbitrary developments but it is already happening in Europe.  Perhaps the Schengen Area or a variant of it could be expanded to include the United States, Australia, Japan and so on?  When a formerly developing country reaches a similar level of development, they can join and eventually all will have abolished passport and immigration controls at their borders.  However, I think the people in the No Border Network cannot countenance such a reasonable policy because it affirms the existence of a state (at least in their lifetimes).  Stuck in the anarchist paradigm they can see no way out of the disastrous consequences of the sudden removal of border controls so they simply shut their eyes to the problem.

Therefore, we can conclude that the results of a free immigration policy, if enacted immediately, would have some extremely negative consequences for the developed countries of the world.  While global economic convergence would eventually occur great pain would be felt by the poor in developed countries with limited immediate benefit for the immigrants themselves.  The open borders policy would very probably alter the makeup of liberal societies transforming them into illiberal ones.  A much more realistic policy would be for the gradual dismantling of immigration barriers in conjunction with policies of free trade and free markets; thus when the world is not as economically disparate border controls will disappear allowing for optimum division of labour so finally worldwide peace and prosperity can occur.

Notes

(1)Commission on Living Standards, Gaining from Growth: The Final Report of the Commission on Living Standards, 2012, retrieved 2nd December 2013, http://livingstandards.org/final-report/gaining-from-growth-a4.pdf, p. 9.

(2) David Friedman, The Machinery of Freedom: Guide to a Radical Capitalism (2nd ed.), Chicago, LaSalle, 1989, p. 70.

(3) Walter Block, ‘A Libertarian Case for Free Immigration’, Journal of Libertarian Studies, 13, no. 2, 1998, pp. 167-186 (p. 176).

(4) Ludwig von Mises, Nation, State, and Economy, New York, New York University Press, 1983, p. 58.

(5)Neli Esipova & Julie Ray, ‘700 Million Worldwide Desire to Migrate Permanently’, Gallup, 2nd November 2009, retrieved 2nd December 2013, http://tinyurl.com/2b6phe7.