Sunday, July 02, 2006

Cost Of Open Borders

We all know immigration is a difficult subject. For the centre right it's a virtual no-go zone. So when David Bonkitt told us there was "no obvious limit" to immigration, and that without it "growth would stall, economic flexibility and productivity would reduce", virtually nobody in the mainstream gainsaid him. Labour's open borders policy has gone virtually unchallenged.

Thank God then that at least some on the left are now speaking out. Last week it was Frank Field, urging mainstream politicians to stop pretending the issue doesn't exist. And today we hear from a leftwing economist, explaining how Labour's oft repeated assertion that immigration is good for the economy is just so much rollocks.

In truth, Bob Rowthorn- Professor of Economics at Cambridge- has been pointing out the economic costs of immigration for some time. But today he gives us the potted version:

"The Government's claim about the economic benefits of immigration is false. I have examined many serious studies and there is no evidence from any of them that large-scale immigration generates large-scale economic benefits for the existing population as a whole. On the contrary, all the research suggests that the benefits are either close to zero, or negative.

Immigration can't solve the pensions crisis, nor solve the problem of an ageing population, as its advocates so often claim. It can, at most, delay the day of reckoning, because, of course, immigrants themselves grow old, and they need pensions.

The injection of large numbers of unskilled workers into the economy does not benefit the bulk of the population to any great extent. It benefits the nanny-and housecleaner-using classes; it benefits employers who want to pay low wages; but it does not benefit indigenous, unskilled Britons, who have to compete with immigrants willing to work hard for very low wages in unpleasant working conditions.

For low-skilled Britons, the result is that there are only two options: very low pay or unemployment. The economy becomes dependent on a constant influx of immigrants who are willing to accept low pay and poor working conditions. That is what Labour ministers mean when they insist that "public services would collapse without immigrants".

It is bizarre that the Labour Party, which still continues to insist that it is the party of the poor and vulnerable, should endorse a policy the purpose of which is the creation of what Marx called "a reserve army of labour": a pool of workers whose presence ensures that rates of pay for cleaners and ancillary staff in the NHS can be kept as low as possible."

The economic argument for mass migration is fallacious. What's more it entirely ignores what economists call distributional effects: the benefits go to the rich, and the costs go to the poor.

The final outrage is that Labour did all this without asking any of us. It has not featured in any of their manifestos.

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