Southwest Virginia Population decline 2010-2018.

Proof Limiting Mass Immigration Helps the Working Poor

by Lewis Loflin

Mass immigration is another facet of crony capitalism. When the deluge of wage serfs is cut off or reduced business begins to pay the true cost of doing business and market forces work in everyone's favor.

The direct cost nearly all of it imposed on state and local taxpayers is a staggering $84 billion a year - in addition The New York Times noted that direct corporate welfare (incentives) cost state-local taxpayers an addition $81 billion a year. That's not counting the secondary effects of depressed wages - job displacement causing increased poverty and associated costs.

The US Conference of Mayors (a liberal group) notes the following:

Jobs gained during the economic recovery from the Great Recession pay an average 23% less than the jobs lost during the recession according...The annual wage in sectors where jobs were lost during the downturn was $61,637, but new jobs gained through the second quarter of 2014 showed average wages of only $47,171. This wage gap represents $93 billion in lost wages...

Most notably, the report also found that since 1975, the increasing share of income earned by the highest quintile -- the 20% of households with the highest incomes - rose from 43.6% in 1975 to 51.0% in 2012. Most of that gain occurred in the highest 5% of incomes, which rose from 16.5% in 1975 to 22.3% in 2012, a gain of $490 billion in 2012 income.

The paper (WAGE GAP WIDENS FROM RECESSION AS INCOME INEQUALITY GROWS) laments the exploding income gap but evades discussing why. Since 1975 we've had a deluge of mass immigration that has destroyed American workers that along with other economic policies favoring unearned income (business, investment) over working an actual job have combined to destroy low-wage unskilled workers.

Harvard professor George Borjas notes that just illegal aliens cost native born workers $99 to $118 billion heavily load towards poor people of color. (Here and here).

I can tell one exactly where $283 billion of income is coming from. Most of the job creation has been and will be low-skilled and low-pay. They make their money by driving down labor costs with a job marker glutted with low-skill labor. We bring in millions of illegal workers to do farm work at depressed wages, but then allow them to flood into every other job sector depressing everyone's wages - in particular minimum wage workers.

Can we turn this around? Yes!

The AP on September 27, 2014 reports the following:

With the harvest in full swing on the West Coast, farmers in California and other states say they can't find enough people to pick high value crops such as grapes, peppers, apples and pears. In some cases, workers have walked off fields in the middle of harvest, lured by offers of better pay or easier work elsewhere...

What happened to the millions of imported illegal workers that were supposed to be doing those jobs? Where did they go? Make a guess. It's bad enough we allow agribusiness to exploit and abuse these workers - then we look the other way when other businesses get in on the deal and replace native born workers who cost more and have some legal protections.

Due to the slowing deluge of serf labor businesses are finally paying the true cost of production:

...farmworkers, whose incomes are some of the lowest in the nation, have benefited, their wages jumping in California to $2 to $3 over the $8 hourly minimum wage and even more for those working piece rate...has led some farmers to offer unusual incentives: they're buying meals for their workers, paying for transportation to and from fields, even giving bonuses to those who stay for the whole season...workers can now earn more than $1,000 per week."

A $1000 a week? Why don't Americans work these jobs? On the one end we've made it too easy for business to cut the throats of their workers and socializing many of their costs ($84 billion) they should be paying. On the other end welfare ends up paying more in real terms than a job does.

Folks can argue some of these businesses will close without the cheap labor - let them. That's the way capitalism works. This is merely another facet of crony capitalism where state meddling in the economy benefits those that can buy the congress critters.

As one person whines, "These growers have decades of investment into plant stock, they can't just transition overnight to be less labor-intensive." If we had cracked down on this government sanctioned serfdom they would never have made those bad investments. What business really wants:,

"For years, farmers throughout the U.S. had access to an abundant, cheap, mostly unauthorized labor force streaming in from Mexico. Workers say they often had to beg growers for even a few hours of work and their wages were low."

So why do liberals (in the press in particular) whom should support poor workers instead cover for those hurting them? Is it the concentration of media into a few corporate hands? Is it diversity ideology they never practice themselves? I don't understand it. The good news is mass immigration from Mexico has not resumed.

"The shortage - driven by a struggling U.S. economy, more jobs in Mexico, and bigger hurdles to illegal border crossings...Farmers say immigration reform, which would legalize their current workforce and create a guest worker program to legally bring farmworkers from other countries, could solve the labor shortage problem. Immigration reform, however, has stalled in Congress..."

There is no labor problem it's the unwillingness of business to pay the true cost of production and expect society to shoulder the economic and social cost. It's crony capitalism, it's exploitation and it's wrong. What good does it do to raise minimum wage only to allow business to evade it? It's obscene that workers are becoming better off in Mexico than in America. No wonder so many go on welfare.

Finally:

Growers like Carson Smith, in turn, have raised wages by 20 percent over the past two years. The wine grape grower, who farms 800 acres near Fresno, said his biggest competition for workers is from table grape growers who are also raising wages for their pickers.

"The fear of a shortage drove us to increase pay," said Smith, who paid his machine drivers $12.75 per hour, $2 more than previous years. "We set our wages to where we thought we could attract people, though it was still tougher than other years to fill our positions."

Isn't competition what capitalism is about? That's how capitalism is supposed to work.

History of Local Poverty

"The most corrupt region is Southwest Virginia...more indictments for political and public office corruption have happened in this region than all other parts of the state combined." Larry Sabato, director of the University of Virginia's Center for Governmental Studies.

"It's a little-known fact that roughly 20 percent of the children in Southwest Virginia live below the poverty line and go hungry every night." Kevin Crutchfield, President Alpha Natural Resources, January 15, 2009

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