The FP Top 100 Global Thinkers

6 Ideas for the Ash Heap of History

The just-plain-wrong notions that (hopefully) bit the dust this year.

BY TYLER COWEN | NOVEMBER 28, 2011

The world can be a humbling place for the purveyor of big ideas. Each year, earth-shattering events, be it the 9/11 attacks, the 2008 financial crisis, or the 2011 Arab Spring, upend received wisdom and demand fresh thinking. So what are the big ideas that should be thrown out this year?

1. Illegal Mexican immigration is a growing threat. This sure doesn't seem like a dead issue, as the rhetoric is alive and well among conservative Republican politicians; observe the reaction to Texas Gov. Rick Perry's in-state tuition plan for illegal immigrant students. Even Democratic President Barack Obama has pursued deportations at a relatively rapid pace. Nonetheless, the reality on the ground is outracing the political debate. The annual flow of about 500,000 illegal Mexican migrants has slowed to about 100,000 a year; that's a huge change. Mexico, meanwhile, is undergoing one of the most rapid demographic transitions in history as its fertility rate is just slightly over two per family, barely above America's. Thirty years from now, the United States may have to compete to lure Mexican immigrants across the border.

2. Green energy will save us. Not anytime soon. Obama came into office vowing to bring about a "clean energy" nation, but the recession has turned priorities away from environmental causes. The United States seems further than ever from addressing its carbon problem. Americans now see the expansion of fossil fuel production as a higher priority than green energy, and this margin of difference has only grown since 2007. Rightly or wrongly, the Solyndra scandal has given solar power a bad name. Nuclear power seems to have lost its allure after the Fukushima disaster, as greens who once saw it as a possible carbon-light solution are now swearing off it. Perhaps a surprising technological miracle lies right around the corner, but the more likely outcome is that the political impetus for green energy will be largely dormant for some time to come.

3. Bank runs are a thing of the past. Sadly, bank runs are alive and well. They first resurfaced in the United States with a run on money-market funds and on the so-called shadow banking system in 2008. We're now seeing gradual "silent runs" on European banks, as depositors wonder why they should keep their money in Greece or Portugal, leading the banks of those countries to wither. The withdrawals of these peripheral eurozone countries from capital markets are like another form of bank run, except the victim is a country rather than a bank. Expect more bank runs, not fewer, at least for the foreseeable future.

Wikipedia Commons

 SUBJECTS:
 

Tyler Cowen is Holbert C. Harris professor at George Mason University. He blogs at Marginal Revolution.

PSCHAEFFER

2:56 PM ET

November 28, 2011

Illegal Mexican immigration

Illegal immigration has slowed. It is not zero. If the economy ever recovers, it will take off again unless we enforce our laws. However, even assuming perpetual stagnation, we still have 11 million illegals living here. Sending them home would create 6-7 million jobs for Americans. We need them. Wages would rise. That’s a “good” thing.

Letting the illegals stay will enable them and their children to be an ever greater burden on our nation. We will end up with a less educated, poorer, more polarized, more unequal, more congested, etc. nation.

Do we need more poverty? Unemployment? Failing schools?

This topic has been extensively researched and the results are highly negative. A number of references make this point all to clearly.

1. The 1997 National Academy of Sciences study found that each low-skilled immigrant costs $89,000 over the course of his/her lifetime. See http://bit.ly/98KcJf

“The NRC estimates indicated that the average immigrant without a high school education imposes a net fiscal burden on public coffers of $89,000 during the course of his or her lifetime. The average immigrant with only a high school education creates a lifetime fiscal burden of $31,000.”

2. There is little evidence that the children, grandchildren, and great-grandchildren of illegals will do much better. Samuel Huntington looked at this subject in his book, “Who Are We”. See Table 9.1 on page 234 or http://bit.ly/foZPxH. The bottom line is that educational attainment rises from the first to the second generation and then plateaus at levels far below the national average. For example, even by the fourth generation only 9.6% of Mexican-Americans have a post-high school degree.

3. The Heritage foundation found that low-skill immigrant households impose huge tax costs on Americans. See “The Fiscal Cost of Low-Skill Immigrants to the U.S. Taxpayer” (http://bit.ly/98MAOo). The summary is

“In FY 2004, low-skill immigrant households received $30,160 per household in immediate benefits and services (direct benefits, means-tested benefits, education, and population-based services). In general, low-skill immigrant households received about $10,000 more in government benefits than did the average U.S. household, largely because of the higher level of means-tested welfare benefits received by low-skill immigrant households. In contrast, low-skill immigrant households pay less in taxes than do other households. On average, low-skill immigrant households paid only $10,573 in taxes in FY 2004. Thus, low-skill immigrant households received nearly three dollars in immediate benefits and services for each dollar in taxes paid. A household’s net fiscal deficit equals the cost of benefits and services received minus taxes paid. When the costs of direct and means-tested benefits, education, and population-based services are counted, the average low-skill household had a fiscal deficit of $19,588 (expenditures of $30,160 minus $10,573 in taxes).”

4. Heather MacDonald has written extensively on the bleak realities of mass unskilled immigration. I recommend “Seeing Today’s Immigrants Straight” (http://bit.ly/hl5aZP). Key quote

“If someone proposed a program to boost the number of Americans who lack a high school diploma, have children out of wedlock, sell drugs, steal, or use welfare, he’d be deemed mad. Yet liberalized immigration rules would do just that. The illegitimacy rate among Hispanics is high and rising faster than that of other ethnic groups; their dropout rate is the highest in the country; Hispanic children are joining gangs at younger and younger ages. Academic achievement is abysmal.”

5. Edward P. Lazear’s (CEA / Harvard Economics) paper “Mexican Assimilation in the United States” has a wealth of statistics showing the raw deal from south of the border. Summary quote.

“By almost any measure, immigrants from Mexico have performed worse and become assimilated more slowly than immigrants from other countries. Still, Mexico is a huge country, with many high ability people who could fare very well in the United States. Why have Mexicans done so badly? The answer is primarily immigration policy.”

See also “Lazear on Immigration” (http://bit.ly/eGV9iR). Money quote

“Immigrants from Mexico do far worse when they migrate to the United States than do immigrants from other countries. Those difficulties are more a reflection of U.S. immigration policy than they are of underlying cultural differences. The following facts from the 2000 U.S. Census reveal that Mexican immigrants do not move into mainstream American society as rapidly as do other immigrants.”

You can read the rest over at the Borjas blog.

 

SPOOD

4:38 PM ET

November 29, 2011

Bigotry and ignorance abounds with the anti-illegal platform

The current anti-illegal brouhaha has more to do with using bigotry to garner votes than reality would ever suggest.

To be brutally honest, if your job is capable of being stolen by an illegal alien, you are an effing moron. You don't deserve to be paid at a living wage in this country. It means you have little to no skills and education and your job could be done by someone who usually has no more than a grade school education, doesn't speak your language and can work for peanuts (or be done by children overseas). There is no reason why anyone in this country is incapable of getting a HS diploma and at a minimum some kind of trade skills so they don't have to work as unskilled mute labor.

Frankly our citizenry does more to drain public resources than illegals who for the most part can't partake in them.

Fiction: Migrants take jobs that hardworking Americans want.

Fact: Approximately 96% of working age migrants employed
in the U.S. work largely in sectors that most Americans avoid.
For the past three decades the United States has created
millions of low paying, unskilled jobs in services and
construction. That trend will continue in the foreseeable
future. There will be far more positions open than there will
be Americans with appropriate levels of education to fill them.
http://istillhaveadream.org/POM_june2007.pdf

Fiction: Mexican immigrants don’t assimilate.

Fact: Like previous groups of newcomers, undocumented
migrants eventually assimilate. Hispanics, including
undocumented immigrants, exhibit an intermarriage rate ten
times those of white Americans. Mexicans in the U.S.
increasingly see themselves as Americans, obtain
naturalization and declare adherence to the American creed.
Mexican Americans are fully represented in the Armed Forces
and have died in the War against Terrorism.

Fiction: Undocumented migrants raise crime rates in
the United States.
Fact: Immigrants appear to raise crime rates only when
immigration violations are included in crime statistics. Most
sentences being served by undocumented immigrants are
short, indicating that their offenses are mostly not violent.

Fiction: Immigrants lower wages for native-born
Americans.

Fact: Undocumented migrants have a mixed effect on wages
across America. Most immigrants do not compete for jobs
directly with Americans. The National Academy of Sciences
found that undocumented immigrants lower native wages by less
then 1%. On the other hand, undocumented migrants lower the
costs of services that all Americans use.

 

M PEARLESTEIN

6:28 AM ET

December 1, 2011

Tyler Cowen ignores externalities

Dear Professor Cowen,

For someone who is aware of human biodiversity your claim that the US would be competing for Mexican immigrants is somewhat odd. Surely you are aware of the downstream consequences of second generation migrants lagging in educational outcomes? Look at the problems it poses for California.

"A recent study by UC Santa Barbara's California Dropout Research Project estimates that high-school dropouts in 2007 alone will cost the state $24.2 billion in future economic losses.

Even those who graduate aren't necessarily headed to success. According to one study, 69 percent of Latino high-school graduates "do not meet college requirements or satisfy prerequisites for most jobs that pay a living wage." It is difficult to see how the majority-Hispanic labor force of the future can provide the skills that the sophisticated Los Angeles economy demands. Already studies show that as many as 700,000 Los Angeles Latinos and some 65 percent of the city's illegal immigrants work in L.A.'s huge underground economy...

Given the aging white population (average age, 42), many of these new graduates will have to come from the burgeoning Latino immigrant population (average age, 26). By one estimate, this would require tripling of the number of college-educated immigrants, an impossibility if current trends hold. The state's inability to improve the educational attainment of its residents will result in a "substantial decline in per capita income" and "place California last among the 50 states" by 2020, according to a study by the National Center for Higher Education Management Systems."

National Review Online: Stop Illegals, Save CA by Alex Alexiev August 24, 2009

As David Frum writes: Many Americans carry in their minds a family memory of upward mobility, from great-grandpa stepping off the boat at Ellis Island to a present generation of professionals and technology workers. This story no longer holds true for the largest single U.S. immigrant group, Mexican-Americans.

Stephen Trejo and Jeffrey Groger studied the intergenerational progress of Mexican-American immigrants in their scholarly work, “Falling Behind or Moving Up?”

They discovered that third-generation Mexican-Americans were no more likely to finish high school than second-generation Mexican-Americans. Fourth-generation Mexican-Americans did no better than third.

If these results continue to hold, the low skills of yesterday’s illegal immigrant will negatively shape the U.S. work force into the 22nd century.

The failure to enforce the immigration laws in the 1990s and 2000s means that the U.S. today has more poorly skilled workers, more poverty and more workers without health insurance than it would have generated by itself."

The Future Costs of Today’s Cheap Labor May 3rd, 2010

 

DARON

3:29 PM ET

November 29, 2011

Scary

It is really scary to see this is where we are in the world today! New laws and policys are needed fast!

 

FERNANDORE

8:59 AM ET

December 7, 2011

6 Ideas

Good 6 Ideas ! i Agree in It is really scary to see this is where we are in the world today! New laws and policys are needed fast, good work! Seguro Imoveis Massagistas Acompanhantes Ar Condicionado Carro

 

MICHELFEENSTRA

4:34 PM ET

December 14, 2011

Green Bankers

green is the way to go, stop giving money to scum like the big banking executives and the oil companies, instead find ways to evolve as mankind and find solutions, like green energy and transparent bankers

 

MICHELFEENSTRA

4:38 PM ET

December 14, 2011

Mexicans are there to stay

Because the live in such poverity in Mexico they will go to the States no matter what Sexshop So don't blaam the mexicans for it and help them so they woudn't consider leaving Mexico

 

WILLRIVERA

3:06 PM ET

December 21, 2011

Illegal immigration

Maybe you should read my remarks once more. Maybe you have known a few who desperately wanted a young child - then conceived one, simply to learn the fetus had terrible abnormalities? Maybe you have paid attention to their doctors let them know the deformed child wouldn't survive, but would only reside in terrible pain provided she or he existed? Maybe you have paid the medical expense? Well, I've known those who have faced this type of dilemma. My statement concerned contraception and also the enormous burden placed through the Chinese upon the ladies. Before I looked, I saw that ladies can't make themselves pregnant with no sperm donor. I'm certain you like the thought of visual impact muscle building having through the State to hold via a pregnancy that was brought on by incest (and - obviously, rape). Well, healthy for you. Will you comfort the kid who had been instructed to give birth. Are you going to adopt the infant? I did not think so!

 

YARINSIZ

4:00 PM ET

December 24, 2011

To be brutally honest, if

To be brutally honest, if your job is capable of being stolen by an illegal alien, you are an effing moron. You don't deserve to be paid at a living wage in this country. It means you have little to no skills and education and your job could be done by someone who usually has no more than a grade school education, doesn't speak your language and can work for peanuts (or be done by children overseas). seslichat here is no reason why anyone in this country is incapable of getting a HS diploma and at a minimum some kind of trade skills so they don't have to work as unskilled mute labor.