October 3, 2013

Case Closed!

From Marginal Revolution:
Does increasing inequality weaken the case for additional low-skilled immigration? 
by Tyler Cowen  
In general, no.  Let’s assume that the increase in inequality is driven by new technologies, such as automation, or by foreign trade. 

In other words, let's begin by assuming that the increase in inequality is not caused even in part by additional low-skilled immigration. Ergo, increasing inequality does not weaken the case for additional low-skilled immigration.


Case closed!
See 1:44 to 2:01.


Wes said...

I am going to use that to win all my arguments in the future: "For the purposes of discussion, let's just assume that your position is completely without merit."

Anonymous said...

Pat Buchanan has been saying for years that the more diverse a society is, the more inequality you will have. Since our immigration policy promotes diversity, inequality will only grow larger.

It is amazing how a seemingly high IQ group, our elite, cannot or will not make these simple connections. For example, they claim they want to reduce inequality. They spend billions each year on programs to do this. They send their children via Teach For America into the cauldron. They waste money on stupid things like the LA school district's ipadgate. Yet they turn around and promote mass third world immigration. It's like taking a step forward and ten steps backward.

They make a huge fuss over health care expenses rising too much, which is true. They seemingly try to do something about it while ignoring the problem of illegals bum rushing the emergency rooms of the nation. So they try all sorts of things to supposedly cut medical costs while ignoring the impact of illegal immigration and mass legal, third world immigration on the health system.

I just can't believe they can't see this since they are so intelligent. It has to be deliberate. But I think it is only deliberate at the highest levels. I think the TFA types and the people in the bureaucracy actually believe it though.

Anonymous said...


You are too charitable even to Cowen's argument.

Even if we grant him the "causes" of increased inequality, it doesn't follow that we shouldn't restrict immigration on inequality grounds.

Restricting immigration ameliorates the effects of inequality that is caused by other factors.

Anonymous said...

Lionel Hutz: "I rest my case."

Incredulous Judge Snyder: "You rest your case?"

Lionel Hutz: "What? Oh no, I just though that was a figure of speech. Case closed!"

countenance said...

Shorter Tyler Cowen:

Automation is making people redundant, so let's let in more people.

Anonymous said...

Someone should calculate (I guess I could, but I'm lazy) how many more tons of Carbon are being burnt each year by having all these immigrants having to drive around the sprawling, climate-controlled suburbia of the US rather than staying in their own, poorer countries.

Anonymous said...

Let's see if I can sum up every debate with our superiors in the economics department of the blogosphere:

part 1

"I'm not sure immigration has been so great for California because--"

"--you're racist. You should really work on that and reflect on the possibility that you're just mentally ill."

"Wait, what? I was going to say that California has turned into a mess with awful schools, budget problems, overcrowded and underfunded hospitals, increased crime, unaffordable cost of living if you want to live with things like decent schools, decent weather, decent safety, a sense of community, social capital..."

"Diversity is our strength."

"Well, I'm not sure that's the case if we look at it from every angle as I'm trying to--"

"--I'm an economist and I like Vietnamese restaurants. Diversity is our strength."

"That's nice, Tyler, I also enjoy a variety of foodstuffs, but I'm not sure that's the only consideration at stake here...."

"You obviously haven't taken my class on globalization. Mathematical models prove it's good for the economy."

"Don't you think you might be begging the question? I'm trying to discuss empirical evidence that might show it's bad for the economy. In science we generally reconsider hypotheses that don't accurately describe phenomena..."

"But there are only two ways to think about this:

1. My rigorous, objective mathematical model with my arbitrary assumptions.

2. Subjective considerations about culture.

That list is exhaustive. So it sounds like you're both objectively irrational and subjectively a racist prole who can't enjoy ceviche. Do I have that right?"

"Well no, I don't think so. If you look at the history of postwar California I think you'll find that on a variety of metrics it enjoyed a better standard of living before the massive immigration of th--"

"You're stupid. We stole California from Mexico. You think they didn't have latinos there in 1950? Dumb racist."

"I didn't say zero. And while a discussion about white Spaniards colonizing North America may be enlightening it does strike me as tangential to the issues of demographic change and immigration policy in contemporary America. So if we can get back to that for a moment...

Why has California experienced so many of the problems I listed? Why are California public schools near the bottom of national lists? Why is the poverty rate the highest in the nation?"

"Racism. Failure to help them assimilate."

"But other groups faced much more extreme racism and assimilated while the data show that Mexican-Americans do not tend to assimilated at high rates even when you look across five generations"

Anonymous said...

part 2

"Look, there's also economic churn. Creative destruction."

"What do you mean?"

"California's metrics will ebb and flow based on the state of the industries at the heart of its economy..."

"But California is a shining jewel in the world economy. Silicon Valley, Hollywood, agriculture, tourism, defense, education, etc. California has been covering itself in glory if you look at the top end of the social hierarchy. My point is that immigrants load the bottom end so it's not like--"

"--take Cleveland, Rochester, and Buffalo. Most of the Great Lakes cities have experienced precipitous decline over the last few decades. Let me guess: you think Mexican immigration is the problem. Hilarious!"

"Wait, I wasn't talking about Cleveland's economy so..."

"So you admit it! Cleveland's economy changed without massive waves of Mexican immigrants! QED, your hypothesis fails!"

"I think that's a completely separate question. If we can get back to talking about immigration--"


"Well, if you insist on talking about the rust belt perhaps it's worth thinking about whether destroying working class jobs and abandoning manufacturing was good for the American economy."

"Obviously you haven't taken my class on Globalization. I mathematically prove that globalization is good for us. In my model it doesn't matter if you're a rootless cosmopolitan shilling for global capital or an unemployed blue collar worker in what used to be a textile factory town in rural North Carolina. You see, creative destruction..."

Anonymous said...

""For the purposes of discussion, let's just assume that your position is completely without merit."

An engineer, a mountain climber, and an economist are trapped at the bottom of a well.

The economist looks at the other two and says he knows a way out. Skeptical, they ask him for his plan.

"First, assume we have a ladder...

Luke Lea said...

It's like a three card monty game: which cup is it under, trade, immigration, or labor-saving technology? No matter which one you choose it is always one of the other two, especially labor-saving technology, which everyone concedes is a good thing. Except when does labor saving technology save labor?

We need (1) new statutory limits on the length of the workday; (2) immigration restrictions; and (3) either income redistribution or high tariffs on imports from low-wage countries.

Multi-factorial causes (i.e., the world we live in) require multi-factorial responses. Economics is not for simpletons.

agnostic said...

Cowen is his usual anti-empirical clueless self. Trends in inequality and immigration rates are inversely related, looking at U.S. data from 1820 to present.

Peter Turchin is about the only academic with liberal leanings taking a serious look at these cycles.

But in the economist's mind, This Time Is Different, hence nothing to learn from history. Not even a quick Google Image search of inequality and immigration rates to find already-drawn time series graphs.

A quick gauge of a person's autism score is how much they pay attention to or are interested in history.

Roland said...

A lefty webzine that somehow got me on its email list sent me an article about rising poverty rates in the South (where I live). I posted a comment observing that at least some of the increased poverty was due to the mass immigration of poor people into the country. (Of course the article didn't mention that as a factor.) The next day, I went back for another look, and my comment was gone. They simply won't acknowledge this seemingly obvious truth. It doesn't fit their worldview.

Anonymous said...

That's the way libertarians and economists always think. I recall reading one book on libertarian economics which began with the words (I'm paraphrasing, but not by much) "Let's assume an ideal state, one which is composed solely of working age men, with no women and no children".

The problem with women of course is that when you combine them with men, you get children, and children make the "need" for importing foreign labor completely farcical.

Anonymous said...

I don't think I've ever read anything, ending with a Q.E.D., where I had even the remotest understanding of that which preceded it.

Nanonymous said...

It is amazing how a seemingly high IQ group, our elite, cannot or will not make these simple connections.

They actually do. Very well so. What's missing is the long-term thinking. In their greed, they only think of what's good for themselves and their children. But they prefer to not comprehend that their policies will make things much worse for their grand-grand children (see exhibit #1: the fall of every empire that ever existed)

Anonymous said...

I attended a post-election Republican panel back November. It was filled with big business and finance types. The overwhelming consensus was that the party needed more Hispanics, more immigration, less "Tea Party extremism" and, most of all, to better explain to Hispanics the great benefits of free-market capitalism.

What the GOP Brain Trust is guilty of is nothing more complicated than simple conceit. To them their ideas are simply right, period. They can't even comprehend that they might be wrong or, even worse, that different peoples might fully understand their ideas and want nothing to do with them.

Anonymous said...

It has to be deliberate. But I think it is only deliberate at the highest levels.

This is the Dark Enlightenment.

We here know damned well that it's deliberate.

Auntie Analogue said...

Off-topic: Import More Moslems: http://www.newyorker.com/online/blogs/georgepacker/2013/10/a-reprieve-for-americas-abandoned-friends.html

Do our Dear Rulers honestly believe that Iraqis who worked for the U.S. occupation were really helping Americans and America - that most of them were not simply helping themselves to the massive cash distributions by the U.S. occupation admnistration, or that most of them were trying to use U.S. dollars and to influence the U.S. occupation forces to get a leg up on their domestic clan or sectarian enemies?

How is that some 90-plus percent of Iraqi refugees here in the U.S. are jobless and dependent on every form of welfare you can thing of - and yet our Dear Rulers want to import more such parasites?

Automatic_Wing said...

Cheap chalupas über alles.

Anonymous said...

Anyway, Cowen is talking a load of bull even by the standards of classical economics.
The idea is that increased automation and increased automation is supposed to actually *raise* incomes for the poorest since low paying jobs are supposed to be eliminated and the displaced workers are supposed to find jobs in more productive occupations, that the freed-up purchasing power, (that was formerly tied into expensive products), is supposed to liberate in other areas of spending. Basically, it's the old theory of comparative advantage, the notion that 'free trade' is supposed to benefit *all* its participants.

Believe it or not *this* is the reason why the politicians pushed so hard for 'free trade' back in the 60s and 70s. This *was* the premise it was sold to the public, ie it was supposed to raise living standards for all - especially the poorest. Hard to believe now, but that's the way it was sold.
And, oh, by the way, immigration WAS NEVER BUT NEVER part of this pacakge. Unscrupulous lying bastards tacked it on later as a 'done deal' and try to claim it was part of the deal all along.

Anonymous said...

"It is amazing how a seemingly high IQ group, our elite, cannot or will not make these simple connections. For example, they claim they want to reduce inequality."

They're lying.

Our benign elite are waging war on the rest of the population but they have to hide it - at least for now.

Matthew said...

"They're lying. Our benign elite are waging war on the rest of the population but they have to hide it - at least for now."

Maybe. Unintentional hypocrisy confers a survival advantage. You can be as selfish and self-serving as you want and live guilt-free.

They send their kids to expensive private schools 'because they're better' (and coincidentally free of minorities). They can afford homes in million dollar neighborhoods, so why would they even consider living in neighborhoods overrun with illegal immigrants? And church/synagogue attendance (if they bother)? Why lefty Episcopalians, Unitarians and Jews know it's terribly gauche to try to convert people to their faith, especially since those converts might have (gasp!) dark skin.

David said...

This is the classic meaning of "begging the question." The person begins the debate by simply asking his opponent to forfeit.

Begging the question doesn't mean "asking a question in an aggressive or desperate manner," as every TV weathergirl-turned-news-analyst seems to think.

On Cowan: in his argument is also the implication that increasing inequality per se is not a bad thing. What is wrong with kings and queens stepping on the necks of millions of peasants and peons? Unless, of course, the "economic royalists" are The Wrong Kind of White People. In that case the argument switches to share the wealth.

josh said...

Don't worry, we can just drug all the poor people.

Its been quite something to watch Cowen sell his soul since the blogosphere took him from obscure public university professor to almost-important-person.