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February 2, 2009

Create U.S. jobs: Make workers stupid, unproductive

George Mason University libertarian economist Don Boudreaux pens this clever reply...:

C. Paul Mendez wants to protect American workers from competition with a moratorium on immigration (Letters, Jan. 28). Why stop there? Why not also impose moratoria on worker training and on technological advances? After all, improved worker skills and more highly developed production techniques increase worker productivity. The result is that any given amount of output is produced using fewer workers. So worker training and technological advances, no less than immigrants, also compete with many existing workers.

In truth, any such moratoria are moratoria on sources of economic growth - never wise moves at any time, but especially not during times such as these when investors are especially leery of committing funds to long-term projects.

Sincerely,
Donald J. Boudreaux

... To this letter...:

Jay Hancock's disregard for the plight of unemployed Americans is shocking ("Immigrants can come to economy's rescue again," Jan. 21).

More than 11 million people are now looking for a job. Millions more are involuntarily working part-time or have grown so discouraged they have stopped looking for work altogether.

The best way to help the economy is to get these people back to work.

We need an immediate moratorium on immigration and guest-work visas, not more competition for Americans who can't find work.
C. Paul Mendez
Silver Spring

... Which was a response to this column:

So President Barack Obama, presiding over what will surely be the biggest budget deficits in history, doesn't want the country to go bankrupt.

"If we do nothing, then we will continue to see red ink as far as the eye can see," he said at a news conference two weeks ago. He'll summon a "fiscal responsibility summit," he told The Washington Post last week. America, he said, must make "hard decisions" about Medicare, Social Security and other expensive programs.

Hard decisions, of course, will include cutting costs and benefits, which will anger Democrats. We'll also need to raise taxes, which will anger Republicans.

But the hardest decision of all may be about increasing immigration, which even Obama doesn't seem to want to talk about. The retreat from trillion-dollar deficits must include recruiting millions of new Americans to share in this country's bounty as well as the cost of running it.

Boudreaux's retort is of a piece with the famous story about the Chinese dam, attributed by the Cato Institute to Jerry Jordan:

I am reminded of a story that a businessman told me a few years ago. While touring China, he came upon a team of nearly 100 workers building an earthen dam with shovels. The businessman commented to a local official that, with an earth-moving machine, a single worker could create the dam in an afternoon. The official’s curious response was, “Yes, but think of all the unemployment that would create.” “Oh,” said the businessman, “I thought you were building a dam. If it’s jobs you want to create, then take away their shovels and give them spoons!”


Posted by Jay Hancock at 8:04 AM | | Comments (2)
        

Comments

Check with Dan Rodricks on the theme of his show today.

eg: The US has a nursing shortage but doesn't do much to increase the number of nursing students.

eg: The US has an electrician shortage but doesn't do much to increase the number of electricians.

The same is true of most employment that requires licensing to enter or grow within that profession... the schools and licensing methods function more as gatekeepers to keep their numbers limited.

There are many reasons for this pattern, and some are actually valid), but the effect of them remains a limited and declining pool of native qualified employees.

If Boudreaux's "clever" reply is indicative of the overall intelligence of George Mason's economics department, I hope Mason offers its students a money-back guarantee.

Seriously, if Boudreaux doesn't understand the difference between the impact of worker training and technological advances, which raise the productivity of workers, and immigration, which merely drives down the cost of labor, then he needs to have his Ph.D. revoked (assuming he even has one!)

Importing cheap foreign workers rather than raising the productivity of American workers does not raise output per worker. On the contrary, it lowers it, and makes us all worse off.

Californian agriculture was MORE mechanized 35 years ago than it is today, thanks to the endless supply of low-wage illegal field workers.

Importing foreign workers is not "free trade." It is simply labor rate arbitrage, that lowers the US standard of living in order to profit a few employers.

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About Jay Hancock
Jay Hancock has been a financial columnist for The Baltimore Sun since 2001. He has also been The Baltimore Sun's diplomatic correspondent in Washington and its chief economics writer. Before moving to Baltimore in 1994 he worked for The Virginian-Pilot of Norfolk and The Daily Press of Newport News.

His columns appear Tuesdays and Sundays.
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