Mexican Border, Indian Visas, American Problems

By James R. Edwards, Jr. on August 7, 2010

A Senate-passed border bill has the Indian tech sector howling. Think about that, because it peels back the cover on yet another of our immigration vulnerabilities.

The Senate just passed a namby-pamby "border security" bill before leaving on August recess. That's not news. Open-borders, pro-amnesty types (in this case Sens. Chuck Schumer and Claire McCaskill) often push "smoke and mirrors" immigration enforcement measures to give the easily conned the impression that they're actually "doing something" about the leaky U.S.-Mexico border. This is the latest in that tradition of political song and dance.

The $600 million legislation contains the usual input-side stuff: 1,000 more Border Patrol, 500 new ICE agents, more aerial drones to take pictures of illegals breaching our border. It amounts to more of the same – the appearance of security measures, without any demands for measurable results (output-side elements) or changes in policy that would make border resources more effective.

Now back to the interesting development: Indian IT objections.

In Washington these days, the administration and Congress have dug themselves deep holes of multitrillion-dollar budget deficits and skyrocketing national debt. Breathtaking federal spending continues unabated (on bailouts, government takeovers of auto and health sectors, entitlement expansion, etc.), and increasingly budget hawks are forcing the red-ink spenders to pay for new fiscal obligations.

So, the border measure's costs are paid for by raising certain visa application fees. Companies with 50 or more nonimmigrant (temporary foreign worker) skilled employees here on H1B or L visas (if they make up more than 50 percent of the firm's workforce) will face higher application fees for their foreign worker visas. (Both visa programs have come under intense criticism for fraud and abuse, as well as job displacement of qualified American tech workers.)

Firms in India have vehemently objected. In the Washington Post, the head of an Indian IT group said, "This is a populist measure that is protectionist and discriminatory and is not compliant with the practices of the World Trade Organization. . . . You are running on thin ice if you curb trade to talk about immigration."

Such remarks show the extent to which certain globalist elites equate free trade with unchecked immigration. But the two are not the same. Unfortunately, U.S. administrations have pushed immigration-related measures as parts of trade deals. Inclusion of nonimmigrant visa quotas in free trade agreements has led NumbersUSA to grade votes on several trade measures and members of Congress who "get it" to push U.S. trade representatives to get out of the immigration business.

Free and fair trade of goods tends to benefit both sides; see the great economist Adam Smith. But liberalized flow of labor creates a zero-sum situation where one side clearly gains and the other side clearly loses.

In a Backgrounder a couple of years ago, I cited Chicago School free-market economists to that effect, as related to trade and immigration:

University of Chicago economist Henry Simons warns that trade and immigration bring about different effects and should not be combined, if economic success is the goal:

"Wholly free immigration, however, is neither attainable nor desirable. To insist that a free trade program is logically or practically incomplete without free migration is either disingenuous or stupid. Free trade may and should raise living standards everywhere . . . . Free immigration would level standards, perhaps without raising them anywhere."

Another Chicago economic scholar, Melvin Reder, writes, "[F]ree immigration would cause rapid equalization of per capita income across countries accomplished mainly by leveling downward the income of the more affluent . . . . I resist this proposal." A third Chicago economist, Nobel laureate Gary Becker, has written, "These days open immigration would merely induce people in poorer countries to emigrate to the United States and other developed countries to collect generous transfer payments." This sounds like what SPP is designed to do, to America's detriment.

In his excellent book The Wealth and Poverty of Nations, Harvard professor David Landes writes: "The present tendency to global industrial diffusion will entail, for the richer countries, a leveling down of wages, increased inequality of incomes, and/or high levels of (transitional?) unemployment." He anticipates the objections of free-trade-uber-alles economists who "rely on the sacred certainty of gains from trade for all. International competition, they tell us, is a positive-sum game: everyone benefits."

The new Indian sacred cow has become deliberately confusing trade in goods and easy flow of workers. They parrot the "everyone benefits" mantra. Yet, there is little trade happening where work visas are concerned. America imports cheap foreign labor to perform, in this case, skilled work. India doesn't rely on "competitive advantage" where division of labor is concerned. It doesn't seek to bring over Americans to perform certain work there. That's why they make the charges of "protectionist" and "discriminatory" for our asking more in visa fees. India wants to send its workers here, not to trade workers evenly.

Americans shouldn't be fooled by the pro-trade rhetoric of objecting Indian IT people. They are acting entirely in their self-interest. It would be nice if our nation's leaders would do the same. Sticking to their guns on visa application fees would be a great first step.