Free Trade and Immigration, two sides of the same coin?

Discussion in 'Economics & Trade' started by Anders Hoveland, Sep 13, 2013.

  1. Anders Hoveland

    Anders Hoveland Banned

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    Many large businesses have been lobbying the government to allow them to bring in more foreign workers. They say that "we need more skilled workers to remain competitive with the rest of the world".

    Other businesses are more honest and say that they can not compete with the rest of the world without bringing in lower wage foreign workers.

    Now that is particularly interesting, because these businesses admit that they cannot compete with the low wage labor in other countries. This is completely the opposite of what free trade supporters have been telling us all these years, that we won't have to compete because our country will simply specialize in higher end services. Well, it appears they were wrong.

    So not only have we opened up our markets to cheap foreign imports made with cheap labor, but now we are being told we have to bring all that cheap labor into our country so we can compete.
    This is not an inevitable outcome. Workers and businesses should not have to compete with low paid labor in other countries. I am not against trade, I just think there should be some form of protectionism, tariffs to help compensate for the differences in wage levels, and the comparative lack of costly environmental regulations in developing countries.

    I am making the hypothesis that free trade might go hand in hand with high levels of immigration. After all, if big businesses interests want free trade, they will have to compete with countries where wage levels are very low. And to compete with these countries, they will need to bring in lower cost workers into their own country.

    An excellent example of this is with agricultural fruit picking. The United States has opened up trade with Mexico and Chile. Because of the low cost of labor, it has become cheaper to import fruit all the way from Chile than to grow it in the USA. American farms have difficulty competing with this, so they have had to make use of undocumented migrant workers from Mexico. Although these workers are working illegally, the economic situation is such that the government intentionally ignores it for the most part. The agricultural corporations in the USA have been lobbying hard for inaction, to keep their low wage migrant workers. Some free trade supporting economists have described the situation as an "economic reality". They say American agricultural business needs low cost labor to compete with fruit imports from Mexico. But this does not have to be the case; if the USA put tariffs on Mexican fruit imports, farms in the USA would not have to utilize illegal Mexican workers.

    There have been a huge number of Free Trade Agreements pushed through in the last few decades, despite much vocal opposition, and accompanying this free trade has been a huge rise in immigration.

    In the United States, this issue stretches across political lines. Both Democrat and Republican leaders have been instrumental in pushing through Free Trade policies, while there exist both progressive and conservative groups against these policies. In fact, it seems like what those want at the top is different from what the masses want. In addition, it has been especially difficult to stop this because students studying economics in American universities have been instructed in a very pro-Free Trade perspective. Opinions are very much entrenched in the opinions held by the establishment in the academic departments. If progressives have a monopoly on the social values being taught in schools, strong free marketers have a monopoly on the economic beliefs being taught in schools. The ultimate result of this dichotomy can only result in what can already be seen developing in the United Kingdom: a low wage workforce and a welfare state that supplements the care of these workers. The lower wage work structure (relative to the high cost of living) has led to greater individual reliance on government.
     
  2. unrealist42

    unrealist42 New Member

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    If the free flow of money is allowed the free flow of people must be allowed. Free trade agreements have resulted in flows of money and trade that have resulted in the displacement of millions of people from their livelihoods. To not allow the displaced the ability to seek new livelihoods elsewhere condemns them to the slow death of increasing poverty, starvation and death. Free trade is the reason why so many from south of the border come to the US regardless of the risks and hardships, for them it is their only chance at survival.

    One consequence is that the mass immigration of displaced people has created a huge surplus of low skilled labour in the US that pushed down wages across many sectors of the economy. This has increased bigotry and racism among native low wage earners and, irrationally, increased their support for libertarian views like those espoused by the Tea Party, which would paradoxically make their lives even more miserable if actually carried out but appeals to them through carefully couched speech that reflects their desires.
     
  3. Anders Hoveland

    Anders Hoveland Banned

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    What would be interesting is a discussion about cases where Free Trade deals have resulted in peasants in third world countries being pushed off their land, and thus displaced. I have also heard that many Mexican farmers have been driven out of business by dumping of American wheat. These former farmers then have little choice than to migrate. Free Trade brings other types of jobs to developing countries, but these jobs are not necessarily better than the ones they replaced. For example, wheat farmers have much more independence over their work and can typically own their own farm. In contrast, fruit picking is more labor intensive and requires much more water, so the places it can be commercially grown on are much more limited and expensive. While fruit picking is more profitable than wheat farming, the economics of the situation means that the types of jobs it actually creates are worse. When a wheat farmer who formerly owned his own farm is now forced to work for a big agricultural company picking fruit all day, he might consider migrating to the USA. The working conditions are not good, and harvesting melons and berries can be back breaking work.

    http://www.tradestories.org/Mexico.html

    Increased world demand for sugar has resulted in peasants being evicted off their land:
    http://www.globalissues.org/news/2012/03/30/13185
     
  4. waltky

    waltky Well-Known Member

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    NAFTA was supposed to be the antidote to excess immigration...

    ... how's dat been workin' out?
     
  5. Not Amused

    Not Amused New Member

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    We gave amnesty to a large number of illegals in 1982, long before NAFTA, long before China became a manufacturing power house.

    I've been to Libertarian and Tea Party meetings, I don't see many low skilled labor types. Libertarians and Tea Party wants to shrink government, and Libertarians don't want any borders. How is that attractive to the low skilled poor?

    The promises made by Democrats are in better alignment (at least on the surface). Better schools (if the unskilled went to school, they wouldn't be unskilled, they would just lack job experience), higher minimum wage (which prevents unskilled from getting job experience), and free stuff, paid for by the rich (so they don't have to work).
     
  6. Lil Mike

    Lil Mike Well-Known Member

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    I admit I'm not following your argument. On the one hand, you are saying that people are just units of production and should be allowed in with the ease of goods and services, and on the other hand you are saying that mass immigration has created a surplus of low skilled labor in the US.

    So you are in favor of open borders even though it damages low skilled US workers, or because it damages low skilled workers? I'm not clear on your point.

    Also I'm not sure what that has to do with the Tea Party or Libertarians. Libertarians of course accept your first premise; that people should be allowed in without restriction. I don't think the Tea Party has any particular position on immigration since their issues are limited government and fiscal responsibility. So I'm not getting this point at all.
     
  7. Anders Hoveland

    Anders Hoveland Banned

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    That is not necessarily true. In practice, Libertarians are very divided on this issue. There are many who feel that, although immigration restrictions may go against the spirit of Libertarianism, in practice it is needed to ensure the protection of individual liberties. A country full of people who cannot afford to take care of themselves and many social problems needs a more invasive government to take care of all the problems. Then there are others who are only Libertarian when it comes to certain aspects.

    There are many Libertarians in the USA who, somewhat ironically, oppose Free Trade and immigration. The notion seems to be that some sort of exterior protectionism is needed for an internal free market to thrive.
     
  8. Lil Mike

    Lil Mike Well-Known Member

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    I can't speak to what each and every self described libertarian thinks, but the movement as a whole, and the Libertarian Party platform, is supportive of open borders.
     
  9. unrealist42

    unrealist42 New Member

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    My point is that the consequences and results of poorly thought out ideologies applied to reality are often profoundly different than those intended by the imbeciles who champion them. NAFTA put 40million corn farmers out of business in Mexico, CAFTA resulted in the displacement of 6million tenant farmers in central America. The flood of immigrants across the southern border is a direct consequence of these trade deals. At the same time the US was reducing tariffs and import limits on textiles from Asia, which caused the textile industry in Central America to collapse, creating a situation where the jobs were migrating to Asia at the same time as the number of job seekers exploded. What did all the free trade economists and pundits think these people would do to make a living?

    The answer is they didn't. They deliberately ignored the gorilla in the room and now the US has 12million undocumented immigrants and wages are declining across the board due to a surplus of labour. The republican party spent the decades of the 1980s and 1990s underfunding border protection and castigating immigration authorities every time INS raided employers of undocumented immigrants. Then, suddenly, after 9/11 they reversed course and now lay all the blame for twenty years of their deliberate actions on everyone else.

    The Tea Party Libertarian wing of the republican party appears to have nothing coherent to offer. They vote against immigration reform and free trade agreements with the same fervour, and the same sort of incompetent narrow minded thinking that resulted in 12million economic refugees fleeing to the US.
     
  10. Lil Mike

    Lil Mike Well-Known Member

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    Well I guess the only thing that is more clear is that from your perspective, everything is the Republican's fault.

    Republicans do have their share of blame in this, and it's a large one. I think you would be hard pressed to find a Republican who would disagree with that. There is a large wing of the Republican Party that favors amnesty and open borders; the Bush-establishment wing of the party. But there is also a large wing of the party that regards it a crazy to import 12 million unskilled workers and permanently increase legal immigration from a million to 3 million a year. It's hard to believe with unemployment being as high as it is that it would be taken as seriously as it apparently is, but there ya go.

    However you seem to be pretending that the Democrats don't even exist or had nothing to do with this. NAFTA was bipartisan, and it was a Democratic President championing it. The Senate Bill on immigration passed with every single Democratic vote in the Senate. They are currently the driving force in open borders now. But if it's easier to believe that it's the Republicans fault for everything, go ahead.
     
  11. Not Amused

    Not Amused New Member

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    The concern isn't open borders, it is unidirectional open borders.

    Their are also conservative "Democrats" and liberal "Republicans". Lets focus on the platform, not the outliers.
     
  12. Munqi

    Munqi New Member

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    Global free trade is the biggest scam in history.

    Imagine how great life would be if we werent governed by people who despise us.
     
  13. Reiver

    Reiver Well-Known Member

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    Globalisation necessarily reduces the ranges of discretionary that can be used. Are there aspects where there needs to be significant changes in multilateral agreement? Certainly! We can blame the US and EU for that, given their internal politics has hindered the use of such agreement to maximise economic development
     

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